Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1881-06-03
TEE STOCK TAXATION DECISION.

lUdhluP luis uSClSiOl 4t hGo AiiSSN AtOAA
the State an incubus which was wasting its
life away. 1t has removed from it the pro-
hibition which the new Constitution
operated to produce abroad. But in this
life evil, once set in motion, inevitably
reproduces and perpetuates itself continu-
ally, and it is rare that in escaping from its
consequences men are enabled to eradicate
its seeds, and put full stop to its exist
ence. The trainers of the new Constitu-
ton were men Of firm purpose but feeble
intelligence. They possessed much more
malice than sense. But they knew enough
to make their intentions clear, and IN
| nothing did they express themselves less
ambiguously than on the question OF taxa
ton. It was their belief-the belief, that
is, of the controlling majority of them
that the taxation OF certificates OF stock
was not double taxation, but the righteous
taxation of property which had hitherto
escaped all contribution to the maintenance
of the Government. They declared that
stock and shares were property, and liable
therefore to taxation. They unquestion-
ably in SO declaring provided for double
taxation, but this they were too stupid to
realize, and they thought that the denun-
citation OF their method by those who had
intelligence enough to perceive its true inn
plication was merely an artful device for
shielding the stock holders who sought to
escape taxation.
The Constitution. makers were quite
wrong, but they were as certainly quite
sincere. They meant to tax stock sepa
rately, and they put language in the Con-
stitution which declares that meaning
very plainly. But the consequences of
this provision have been disastrous, and
threatened to be more so in the future 1t
had acted as brand upon the forehead OF
California. 1t had been equivalent to
sign. board saying, Here the State plays
the role of highwayman, and robs the
=" citizen" 1t had prevented the intro
duction of capital. It had induced CAPT
tai already here to emigrate. 1t had in fact
made it absolutely impossible for men who
owned stock in any enterprise, the head
quarters of which were in another State,
to continue to hold such stock, inasmuch
as the State Constitution imposed upon
every such share tax which operated as
handicap and disqualification as COM
pared with all similar stock held in more
equitably governed States. The foolish
malignity of the Cons.itution-makers was
therefore having very bad and serious eff
fects, and there was danger that these i'll
effects would in short time drive the most
active And enterprising representatives OF
CAPITAL out of the State, and at the same
time prevent the association of capital for
the promotion OF important undertakings.
| Under these circumstances the Supreme
Court was given an opportunity to inter-
pref the Constitution in the matter of the
taxation OF stock, and it has come to the
rescue OF the State, but at the sacrifice
of consistency and plain dealing. The de-
cision of the Court is undoubtedly sound
philosophy and economy. 1t is in full
accord with the best interests of the State.
But it is, we are compelled to say, in flat
contradiction to the express terms of the
Constitution. We do not regret that this
is so. We do not find fault with the Court
because it is so. But we note the fact be-
cause it illustrates our remark that the
consequences of evil are cumulative, and
that their limits can never be set. To
siget even" with the holders OF stock the
farmers who made the Constitution reck.
lcssly and dishonesty insisted upon double
taxation. Ia so doing they set an evil in
operation which is still active. They dis.
honored the organic law by prostituting it to
the erection of an abuse with an institution.
To counteract that abuse, and to secure the
State from its baneful effects, the Supreme
Court has now been compelled to dishonor
the Constitution still further, by ascribing
to it meaning which is not deducible
| either from ITS language or from the spirit
which animated its makers.
There was indeed 70 other way out
/ The Constitution cannot be amended
quickly. Its revision is work OF time,
and, as the proverb has it, I" While the
grass grows the steed starves." There
fore the Supreme Court was justified in
overthrowing this mischievous and in
equitable provision by any means, and if
| in so doing it has credited the Constitu-
tional Convention with more honesty and
enlightenment than ever belonged to that
strange mixture OF demagogues and i'm
beetles, they at least need not complain.
The Court has assumed that the Con-
vention understood its business, and that
it meant only we'll These are violent as
sumptions under the circumstances, but
4 they are warrantable on the part Of the
Court Double taxation is therefore
eliminated from the Constitution, notwith-
standing its language. Far more arbitrary
changes have been made before now in the
Interpretation of the Scriptures, and with
far less defensible motives. The Supreme
Court has done the State service, and if
the Constitution is incidentally brought
into greater disrepute, it will be all the
eoopsr o,,,ended-or discarded