Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1880-04-30
BAasARous LEGISLATION IN NEW YORK.


mischievous war upon capital which was
made in the California Constitutional Con-
vention. These journals were never tired
OF lamenting the low state OF civilization
displayed by that crusade, and of course
they were always prepared to point out
how much injury the community must
sustain from the tendency toward Social
istic and Communistic doctrines. Yet
now it appears that the Legislature of the
State of New York, despite the didactic
influence of its powerful and highly civil
lized press, has been taking a leaf from the
note. book of our demagogues, and has
passed a law the first effect of which is to
drive from S25, 00O,0 600 to $50, 600, 900 of
foreign capital out of New York city
This law is one of the results of the latest
attempt to reconstruct the tax system of
the State. That system has for many
years been VIGOROUSLY defective and inef-
fcent. As far back as 1870 a Com
mission was appointed, with Hon. David
A. Wells for Chairman, to revise the
code in this connection, and the
report of that Commission remains
the most thorough and able examination
of the whole question OF taxation in the
literature of the English language. The
! Commission drafted a new scheme of tax
alton which would have removed all the
old abuses and defects, and would have
made New York the model State OF the
Union in its fiscal administration. But
the intelligence which controlled legisla-
ton was not then, and has not since been,
equal to comprehension of the advantages
of the proposed reforms, and so the State
has muddled on, getting into more Difficult
ties from year to year, and occasionally
attempting such imbecile and suicidal eX-
periments as the present raid on foreign
capital. Several years ago the taxation OF
mortgages caused most disastrous depre-
citation in real property, and seriously
handicapped the State. Now another step
in the same direction is taken, and unless
Governor Cornell has sagacity and courage
enough to veto the new law, the conse-
quences will be more serious than those OF
the mortgage tax. 1t is somewhat remark
able that the New York press should be
so powerless to prevent legislation OF
this damaging character, for to read
its comments upon similar legislation had
in other States, it might be thought that
no such danger had ever approached the
business prospects Of the Empire City. We
do not know yet upon what CROCHET the
new attack upon foreign capital is based.
Perhaps it is justified on the pretense Of
protection to home industry" Possibly
the bill was not at first meant seriously,
but was introduced with the expectation
that the bankers would pay blackmail
rather than suffer expulsion. 1t may be
that on finding foreign capital indisposed
to make terms of this kind, the Legislature
became angry, and resolved to "cinch it
in reality. OF course there is no rational
excuse for the bill, which is in principle as
fatuous as anything our Constitutional
Convention had under discussion.
There is a good deal OF difference be-
tween the attempts at communistic 'egis-
lation here and in New York. The worst
measures proposed here have in nearly
every instance been ultimately defeated,
but in New York every year or two some
particularly bad law gets enacted despite
all protest and resistance. Foreign capital
there is of course willing to contribute
fairly to the State revenues. The bankers
are, it is stated, prepared to pay tax
either upon capital or revenue. But the
new law appears to be an extension OF the
principle incorporated in our latest revenue
system, and its operation upon the foreign
bankers is discriminating and crushing at
the same time. It is possible that some
of the local banks there may have
taken hint from the attempts of
some of our local insurance COM
panies to Danish their foreign competitors,
and that they have found their Legislature
more amenable to their representations
than that of California was. Whatever the
true genesis of the bill, however, it is
evidently a most barbarous and retro
gressive measure, and ii enacted must
tend to fetter commerce, and Indirectly to
benefit other parts of the country at the
expense of New York. For legislation OF
that kind does not necessarily drive for
eign capital out of the country. 1t only
compels it to seek investment in States
with more enlightened and equitable laws.
The States whose people and political lead
ers are the first to realize how greatly the
interests of the community may be adj
vanced by offering free ingress and safe
employment to such banished capital, will,
in effect, acquire for themselves large
part of the prosperity which New
York seeks to thrust away from herself.
They will prosper at her expense, ard this
! process will continue until her declining
commerce forces her business men or her
demagogues, or both, to return to rational
) methods, and so to restore confidence and
invite the return of the capital so prepos-
) terously driven away now. Whatever
community makes unjust war upon capital
must suffer for its blindness and stupidity.
1t is remarkable that the very able press OF
; New York has not succeeded in impressine
this elementary truth upon the State Leg.
) stature, but until it has effected so much
it would perhaps be wise for it to employ
its missionary proclivities at home, and alb
stain from morallzing upon the hlunders Of
other communities.
BIMETALLISM IN GERMANY.
German finance and fiscal science have
never attained high reputation, and the