Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1880-03-05

hafch 3, 1880, on the Subject Of tie
Taxation OF Deposits in Savings
Banks.
tPhOnographically reported by E B. Willis, Senate
reporter OF the REcoRp-UNIoN.
Mr.. sears-Mr. President we have now arrived at
the point in the consideration of this bill which |
consider is proper that this amendment pure and
simple, should be considered This is the proper
place for us now to pause and consider what the
effect will be ii the majority Of this Senate shall de-
terrnine to inflict upon the people of til State
double taxation. To-day, Mr.. President, is the an
ndversary, believe, Of the adjournment OF the
Constitutional. Convention which framed and gave
us the organic law Of the State, under which are
now actinc In the first section Of this bill declar-
alton offered that double taxation was not in
tended by its provisions. That was objected to,
MIR President, on the ground that it was simply q
decla alton without principle. 4 is amendment,
Mr.. President deals with the principle void of the
decl clsration. 1t is the substance, and not the
shadow, and this Sc ate is now called upon to
take its action in Tegar1 to this subject.
When the Constitutional Convention adjourned
and that document placed before the people
for their Endorsement, the advocates OF it upon
every stump assured the people that double taxa
tion not intended, and | believe, SIR. that if
they had advocated double taxation, that the Con-
stituiion would never have been adopted. | re-
member well OF reading the speeches of Judge Terry
and MIR. Howard. and the articles ni the San FRAN
ci> co ChroRfcle Upon every stump and in every
paper which advocated the adoption Of this Con-
stitutiOn, they denied openly and boldly thatit was
the intention to tax class of property in this
State second time in the same year. 1t was upon
those assUTan tnat the people Of this State, by .
large majority, adop ed il as their Magma Charta.
Now, Mr.. President, have got to the point where
we can consider whether we, the representatives
OF the people, ready to carry out IL assurances
of those who framed aud advocated this document
think the Senate will bear witness, that since
| have occupied seat here no member has
been more devoted in carrying out the very letter and
spirit Of the Constitution as understood it than
have. have been sincerely and arnestly endeav-
orng to carry ont its provisions in the enrichment OF
laws, as | considered the trainers of the nstitu-
tiSn intended it should be carried out This amend
ment, MIR. President. deals purely and simply with
this question Of
TAXING SAVINGS BANEs-
Savings and loan corporations as they called
under our laws. Now, Mr.. President, certain Sen
ators on this floor have attacked savings banks.
They have been denounced here as institutions
which possess great financial power; Institutions
which WELD great political influence, and that the
influence OF these institutions have been welded
against the interest of the people. Mr. President, |
deny that they have ever been used for that pur-
pose or that they were organized for any such
object What is the objectS Mr.. Pres dent, of or
ganiz ng savings banks? IL is for the purpose of
having a place where the poor may so and
deposit their little earnings and sleep soundiy
at nlgnt, knowing InaJ tHey are s2ie anu SeCuIe
1t is place which is built and erected strong in its
walls strong in its vaults and burglar proof, so that
those who deposit their money there may know that
it will be safely cared for. Now, this matter OF
double taxation wish to illustrate in very simple
manner and | call the attention of all the Senator's
whether the illustration is not exactly IN ac
cordance with the case. We will suppose, Mr..
President that Senator Zuck has 81, 600 and have
81 coo on the first Monday of March, at noon, the
time that we are required to give in property,
give in the property we have at that time. Now,
when the Assessor comes around he assesses Senator
Zuck for his 81 000 which lie has in his possession
aud assesses to me my 81 GOO which l have in my
possession. Now, that right; that is fair We
both pay our taxes upon that amount of
money, which is all we have. Supposing,
now, Mr.. President = and | am dealing
now with the situation as it is-that desire Just
before the first of March to purchase a lot worth
$1,000 have only got 81 900 to pay for it with.
go to the Senator and he proposes to loan me his
thousand dollars. l purchase the lot and give him
a mortgage. When the Assessor comes around he
will assess him for the one thousand dollars which
he has loaned out on mortgage, and he will assess
the house to me for two THOUSAND dollars, deductin
the Thousand dollars which l have mortgaged
upon it.
THAT is RIGHT AND PROPER,
And it is under Article XIII Section of the Con-
stitution where am allowed to deduct that thou
sand dollars which have mortgsged on my house
and lot. Now, Mr.. President, ii Mr.. Zuck goes and
places his thousand dollars in a savings baik-and
greenback-let us see. purchase this house and
lot / go to the say nes bank where he has Gepos-
tied that thousand dollar greenbaek and the saw
ings bank loans it to me for the purchase
of this lot There, Mr. Pres,d dent is the identical
thousand dollars but it has passed through the
savings bank, the savings bank being bis agent I;
vet under the provisions of this bin and the advo
Gates OF this bIil, they say there muet be three
thousand dollars taxed in case of that kind, that
simply because this money passed through the
age cy OF the savings bank; therefore the savings
bank must be taxed upon the mortgage of Senator
Zuck, he must be taxed upon his deposit, and
must be taxed upon the house and lot, making
tax upon three thousand dollars when there arc
only two thousand dollars in existence. ] submit,
now Senators, il that Is not double taxation, pure
and simple upon the thousand dollars which Sen
ator Zucl< has placed in a savings bank. But, Mr..
President il he we're TO place that thousand dollars
in the hands Of the money loaner or real estate
agent, and that gentleman as an Individual
loaned me the thousand dollars, then you say
it is unjust and improper to tax it, That is the
situation which divides the members of this Senate
here to-day. say, Mr.. President, that to tax this
money twice, because it passes through the saw
ings bank is unjust and unfair. and was not aiyo-
Gated by any member of the Convention in aiyocat-s
ing the adoption Of this Constitution. Now. Mr..
President what would be the eff ct if you seek to
tax these savings bank twice upon their money and
ayain upon their mort cages? Would it no. in its
tendency operate to discourage them, and to dis
courge investment in them? AS Senator Satter-
white and others have said that would drive these
THEY THINK THEY ARE AN INJURY.
l take issue with them there. l believe they are
organized and conducted in the interest of the great
masses of people of small means Now, let us
look at the facts. | find in looking over the
report of the Bank Commissioners this state
of things. ] will take the largest to begin
with the Hibernia Bank OF San Francisco. The
Uibernia Bank in san Francisco, acc riding to this
report of 1879, numbers 10, ,594 depositors. There
are 10 ,5e4 people who have deposited their savings
deposition is $50 70. That shows you, Mr.. Presi-
dent that the average OF all that 10 600 is only $780,
That shows what have said, that it IS the poorer
classes Of people who use the savings banks to de-
post their earnings in. Why, Mr. President, there
is hardly mechanic who labors in San Francisco at
any trade or labor who does not, when his month
expires look forward with joy to the time when he
receives his monthly earnings, pays off his honest
debts and deposits the balance in some savings bank
where it may be secure against trouble against
misfortune, against accident. Every servant girl
almost those places for her deposits. This is
the altar on which they give their ferinS
which they have labored hard for,
and | trust that this Senate will not
say that this class of people, who have saved these
small earnings, who have placed them in savings
bank shall be doubly taxed because they have done
that act Would you force them TO keep their
earnings at homer Would YOU force them to place
them in old stockings in feather BEDS and such
places? Do that and you will
TURN LOOSE ALL THE THIEVES,
Burglars and robbers OF the State upon them. They
will hunt these people and rob them for their
in.s 1t is to give them place of safety and secur
ity, aud when the father dies and leaves his family.
and the money is there, he knows it is safe to pro-
tect his widow and children from hunger and starv
ton il want ever overtakes them. Now, leaving
the Hbernia Bank, we will turn to some others. We
will take the German Savings and Loan Society.
find that the number of depositors s 539 find
the average is 81 103 Again, take the Commercial
and Savings Bank of San jose. find the number
of depositnrs ], 1913. i find the average amount is
e612 Again, take the California Savings and
Loan Society. find the number of deuostors at
533 the average amount is 1926. So you run
through the list This is the average and we find
according to the tabulated statement that the money
deposited in all the savings banks upon this coast Is
over $57, 900, ,000 Now, Mr.. President, have made
a little calculation, and find the average deposit
the average amount which each depositor has in all
these banks-is about $500. You divide that by the
total amount, 81, and it gives you the enormous
number Of II, $50 persons who have their earnings
deposited in these savings banks That number
Mr.. President, is equal almost to one-half OF the
voting population in this State. Now, you propose
have not perhaps the iude,men. and the education
to invest and care for their own money but place
it in the institution where they believe it will be
safe you say to them that il you place your money
there you shall be taxed twice upon il, when the
man who rolls in wealth and luxury, who has genius
and talent to loan his money and squeeze two or
three per cent. from the community, that he thall
not be taxed but once upon what he has.
is THERE ANY JUSTICE IN THIS?
Is there any equity in this position Mr. President,