H́nh ảnh trang
PDF
ePub

an average of 7.5 years, their continued sale helped restructure the debt toward a longer maturity. In 1961, to encourage continued ownership of Savings Bonds, the Treasury made a second 10-year extension of Series E Bonds that had been purchased in the period from May 1941 to May 1949; the interest on the bonds was raised to 3.75 percent per year for the period of the extension. Series H Bonds sold from June 1952 to January 1957 were also given a 10-year extension. On June 30, 1961, Series E and H Savings Bonds were 15 percent of the total public debt. 17

Sales of Savings Bonds remained fairly steady in the early 1960s, and they were still 15 percent of the total debt in 1963. To further encourage the sale of Savings Bonds, the Treasury in September 1962 had announced that taxpayers would be given the choice of accepting Series E Savings Bonds as payment for their tax refunds; by June 30, 1963, $19 million in Series E Bonds had been issued in this way. 18 Effective December 1, 1965, the interest rate on old and new Series E and H Savings Bonds was raised to 4.15 percent. This increase was made after it was discovered that sales of Savings Bonds were lagging due to higher rates of interest being offered on other forms of savings available to individuals. 19 Series E and H Savings Bonds still constituted about 15 percent of total debt in 1966.

In 1967 the Treasury began the most intensive sales campaign for its savings-type instruments since World War II; a U.S. Savings Note referred to as a "Freedom Share," which carried a return of 4.74 percent when held to maturity (4 1/2 years) was introduced on May 1st. During 1967, $4.6 billion in Series E Bonds were sold, the highest sale of this series since 1946. 20 By June 30, 1969, U.S. Savings Bonds and Notes totalled $52.2 billion, still about 15 of the debt. 21

percent

As a result of these debt management policies and Federal Reserve open market operations, the ownership composition of the debt changed during the 1960s. The portion held by the Federal Reserve and by Government Accounts increased, while that of individuals remained steady (see Table Eleven).

17 Secretary, Annual Report, 1961, 15 and 18. 18 Secretary, Annual Report, 1963, 35.

19 Secretary, Annual Report, 1966, 30-31.

20 Secretary, Annual Report, 1967, 14 and 23. 21 Secretary, Annual Report, 1969, 14.

Federal Reserve Assistance

At this time, the Federal Reserve, as part of its duties as fiscal agent for the Treasury, gave considerable assistance in the process of selling new issues of securities. Federal Reserve banks would print announcements of the new issue and distribute them to organizations that were usually interested in purchasing new issues. The banks would then accept subscriptions for the new issues and transmit them to the Treasury. In cases of over-subscription, the Treasury would make percentage allotments to various classes of subscribers. The Federal Reserve would also handle the exchange of securities involved in a refunding.

For the purpose of facilitating secondary market transaction of outstanding Treasury securities, the Federal Reserve also provided useful services. To permit a wire transfer of securities, each of the Federal Reserve Banks kept a supply of unissued securities in its vault. A person selling a government security in one part of the country to someone in another part would deliver the security to the Federal Reserve Bank in his home area, requesting that it be sold in another Federal Reserve district. A new security would be issued in the second district and given to that purchaser on receipt of payment; thus the security in the first district would be retired and payment given to the seller.

In this way, a national market for government securities was established. Buyers and sellers of government securities could buy or sell in whatever area of the country gave them the best price, and the entire transaction could take place in an hour.

[blocks in formation]

Sources: Annual Reports of the Secretary of the Treasury for 1961 (p. 98), 1965 (p. 30), and 1969 (p. 13).

As part of this process, a national market for government securities would be maintained. The Federal Reserve Banks were also keeping

many of the records of sales and redemptions of securities for the Treasury. The Federal Reserve Banks also continued to coordinate the Savings Bond Program, designating issuing and paying agents, keeping issuing agents supplied with unissued bonds and stocks, reimbursing paying agents and keeping the records involved with the program. 22

Debt Administration of the Bureau

Despite the assistance of the Federal Reserve Banks in administering the debt, both the trends in the size of the public debt and the program adopted by the Treasury to manage it, had a great impact on the workload of the Bureau of the Public Debt. This impact can be seen in the increase in the number of accounts of each type of security that had to be administered. One of the Bureau's functions, for example, involved keeping accounts of registered securities issued by the Treasury. In 1961, 34,581 individual accounts were opened, with 30,530 closed, with the total number of accounts outstanding at the end of the year at 248,678. 23 In 1963, the Bureau opened 19,011 such accounts and closed 22,363; the total number of accounts had declined to 242, 184. 24 By 1966, 24,453 accounts were opened with 26,293 closed, and total number of accounts declined further to 213,180. 25 In 1969, continuing a trend of the previous 2 years, outstanding accounts increased to 227,642. 26

This increase in the number of accounts of registered securities was matched by the growth of issues of bearer securities. In 1961, 4.1 million bearer bonds were redeemed and audited. 27 The comparable figure for 1969 had risen to 7.4 million. 28

The workload in the savings bond area also became greater during this time. Because of the promise to replace any U.S. Savings Bonds that have been lost, stolen or destroyed, all accounts for savings bonds are permanent. Since none of the savings bond accounts

22 Thomas O. Waage, Service and Supervisory Functions of the Federal Reserve System, in Herbert V. Prochnow, ed., The Federal Reserve System, (New York: Harper and Row, 1960), 241–242.

[blocks in formation]

maintained by the Bureau can ever be eliminated, the total number of accounts in the savings bond register can only increase. From 1961 to 1969, the total number of savings bond accounts increased by 900 million to a total in 1969 of 3.2 billion, with about 750,000 claims of lost, stolen or destroyed bonds being adjudicated during that same time. 29 30

The Bureau Staff

Despite this increased workload, total employment at the Bureau actually declined during the 1960s. At January 31, 1960, the Bureau employed 2,317 persons; by January 31, 1970, the number of employees was down to 1,915. This means that while total employment by the Federal government was increasing by 15 percent, the Bureau was reducing its level of employment by 17 percent. Historians and critics of government bureaucracy often make much of "empire building" taking place at government agencies during the 1960s. This charge could hardly be leveled at the Bureau of the Public Debt. For a detailed listing of the employment record at the Bureau during the 1960s, see Table Twelve.

TABLE TWELVE

Employees at the Bureau of the Public Debt, Selected Years

[blocks in formation]

* Includes two employees remaining at the Cincinnati Office. Source: Personnel Reports of Full-Time Employees, Bureau of the Public Debt File D-200.5.

[blocks in formation]

Computerization

The Bureau was able to attain the impressive result of handling an increased workload with fewer employees through the introduction of a variety of managerial and technological improvements. Foremost among these was the continued adoption of automatic data processing equipment, which greatly enhanced the Bureau's ability to process increasing amounts of paperwork.

Some advances in the use of automated data processing had already been made by the Bureau. The sale of Series E Savings Bonds in punch card form had started in 1957. The Datamatic 1000 computer installed in 1958 was found to be saving the Bureau approximately $6 million annually by 1962. 31

The 1960s would see further progress. In 1961 the computer system was upgraded with the installation of a Honeywell H-800 computer. The new system made several improvements. The large tape reels needed for the older system had become costly to purchase and store; the new system used smaller size tapes, which reduced much of that expense. The new equipment was faster than the old system, enabling the Bureau to process more data and to centralize its savings bonds records. It was estimated that the speed and efficiencies provided by the new equipment would permit the Bureau to close the Cincinnati Office. 32 It was further estimated that by fiscal year 1963, the new system would result in annual savings of $3.6 million. 33

At this time, all bond stubs and redeemed bonds were sent to Parkersburg, where they were microfilmed by a bank of 16 machines, at the rate of 450 per minute for each machine. The microfilm was then duplicated by a diazo process, with one copy being sent to archives in Wisconsin for security purposes. 34 In 1962 the Cincinnati Regional Office was closed by the transfer of the function of auditing retired paper bonds to Parkersburg, increasing the number of employees at Parkersburg to 600. 35 In 1964 the Bureau micro

31 Memo from M.P. Heckman dated February 19, 1962, located in Bureau of Public Debt files, 3-4.

32 Bureau of the Public Debt, Summary of Decisions Made and Action Taken to Upgrade the EDP System in Parkersburg, West Virginia, (Parkersburg, W.VA: Memo dated September 28, 1962).

33 Heckman, Memo, 1962, 4.

34 A Record Home for Millions, Business Automation, June, 1963, 29.

35 Untitled and undated (circa 1976) report in Bureau of the Public Debt files.

« TrướcTiếp tục »