The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1883-11-29
A NEW FINANCIAL PLAN.
Mr.. Blaine's Scheme for Disposing Of
the Surplus Revenue.
He Proposes that the Receipts from the
Tax on Whisky and Malt Liquors Be
Given to the States.

PHILADELPHIA, Nov. 2S.-The Philadelphia
Press, tomorrow will contain a letter from
James G. Blaine to Charles Emory Smith,
editor of the Press, stating Mr.. Blaine's OBJ
jections to distribution of the surplus reve-
nue. of the federal government amongst the
States, and proposing, as a substitute, if the
national government no longer needs the tax
on spirits the entire amount it yields be paid
to the States. Three fatal objections, in Mr..
Blaines opinion make the Pennsylvania
proposition to distribute the federal surplus
unwise:
First-The utter uncertainty of the size of
the redundant revenue. 1t many be $1,000
900 or $4,000 600, and, unless steady, no
State tax could be RENTED on account of
receipt OF this aid; while sporadic federal con-
tributions to the States would be wasted, as
was the last distribution of federal surplus.
Second-Division of this surplus would
impose upon senators and representatives
divided duty. For the sake of their States
they would wish the surplus to be as large as
possible, which would present constant
temptation to withhold appropriations from
Third-The assumption of a continuing
redundance of national revenue is opposed
to all sound views of administration, be-
cause it is sure to lead to extravaganza, cor
ruption and all manner of schemes.
The time is rapidly approaching, however,
when the national revenue, yielding under
the present system of taxation $100O00000
beyond the amount required for government
expenses, must be reduced. A strong move
ment is already on foot for repeal of the en-
tire system OF internal revenue, which re-
ceives the support of protectonists like Judge
Kelly and of free-traders like Cox,
of New York. This conjunction of opposing
views in support of abolition of the same
tax gives rare opportunity to relieve tax
alton in the States. OF all our taxes, State
taxation is the most oppressive. 1t is direct;
it falls on property with crushing force. In
few communities is it less than 1 per cent,
and in most it is over 2 per cent. Why
therefore, should not the States be permitted
to use the tax on spirits for their own bene-
fit if the national government does not need
it? Can it be wise to continue a direct tax
on property, and at the same time allow a
hurtful luxury like spirits to go free2-a
luxury whose taxation oppresses no one.
The customs revenues of the national gov
eminent are monOpolies. Excise is open,
in theory, to both State and national use in
taxation, but in practice the national au-
thority alone can levy an excise tax on
whisky. No State can guard its borders
against whisky from other States or make
economical collection of such tax within
its own revenue. The federal ma
chinery for collection of this revenue
is in full operation and bill of ten lines
could direct the Secretary of the Treasury to
pay the whole of it, less the small expense of
collection, to the States and Territories, in
proportion to their population, and continue
it permanently as part of their regular rev.
enue. Such plan would give the revenue
from specific taxation wholly to the States,
and would not depend on a chance surplus
or an accidental remainder in the national
treasury. 1t would make the tax on spirit
GUS and malt liquors a permanent resource
10 all the States enabling them thereby to
definitely readjust and reduce their
own taxation. Each State could most
wisely use its share according to
its own necessities The total tax
on spurious and malt liquors last year was
over $4,000, 900, an amount which would
tend to increase rather than diminish as
each State saw that the suppression of illicit
distilleries was to its advantage. With this
revenue State taxation could be RENTED,
State debts paid or, if this aid we're divided
among the cities and counties, their expenses
would be proportionately diminished.
In table annexed to the letter, Mr.. Blaine
shows that the share of the large States, on
the basis of population, would be So, 1893. 900
for New York. 81, 493. 900 Tor Pennsylvania,
S. 285, 600 for Illinois and S., $50 900 for Ohio,
the smaller States receiving in proportion.