The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1885-01-15
The Whiskey Interest.

The Whiskey Interest.
The arguments presented by the distil-
lers, supported by the Attorney-G Generals
opinion, have had the desired effect. New
regulations concerning whisky in ware
house were issued on the 9Th by the Com
missioner of internal revenue, after they
had been approved by the Secretary of the
Treasury. Distillers who declare an in
tention to export their whisky and who
file an export bond are hereafter to be al
lowed seven months instead Of 80 days in
which to deliver the goods at the port OF
departure, and to produce the export GER
tificate of the Collector of that port. The
period is to be .'such time not exceeding
seven months as in the Collectors opinion
may be reasonably required in the process
of the expectation of the particular spirits
| to be covered by the bond, including re-
quired bona fde and necessary delays. )"
Collectors are instructed to see that the
declaration of intention to export is clear
and explicit - that this and all other pro-
ceedings are in good faith'' and that all
steps are taken (which under the law are
incidental to this transaction by the incep-
ton of which, in the language of the Attor-
ney. General, 1.-the spirits are transformed
intoa different subject matter from that
upon which the distillery warehouse bond
had operated and which in his opinion
frees the spirits for the time being from
any obligation for domestic tax"
| After the opinion of the AttOrney-Gen-
eral had been given and before the order
referred to above, from the Secretary of
the Treasury, the New Y ork Tribune made
the following reference to the subject,
from which it will be seen what an impor-
tant interest is involved on the question
determined:
ION the 2Sth of March, 1878, an act OF
Congress was approved extending to three
years the period during which whiskey
might be held in bonded warehouse with
out payment of the tax thereon. At the
time this act passed. there were of old
spirits in warehouse only about 3,SO0,OOO
gallons, and of all spirits at the end of that
fiscal year $4,000, 900 gallons. The produc-
tion during the fiscal year 1878, ending
about three months after the passage of
the act, was only Sc, lO3, O35 gallons during
the very next year the production increased
to II 1892 ,62l gallons, in 1880 to 9O,355, 270
gallons, and in 1881 to III, 728, $50 gallons.
There has never been any question that
this over-production was the direct conse-
quence of the unwise act by which the
Government of the United States under
took to carry, without the payment of tax
for three years, any quantity of whiskey
which the distillers might produce in ex-
cess of the demands Of the market. In
consequence, the quantity in warehouse
increased in 1882 to So, 1926 gallons, on
which tax of about $81 ,00O, 900 was due
to the United States Government, hut its
payment was indefinitely deferred for the
convenience of distillers.
Powerful efforts were made in Congress,
year after year, to get the tax abolished
altogether, or greatly reduced. But to
this day it has refused to change the law
in the interest of the distillers. Conse-
quen thy, they have now taken a new de-
parture, and, instead of seeking relief from
Congress. are trying to get it by an opinion
of the Attorney General which, if ap-
proved and carried into effect by the Secre-
tary of the Treasury, will virtually set aside
the act of Congress. The opinion sought,
and by Attorney-G General Brewster already
given, is. that it is lawful for the holders
of whiskey in bond, upon making affidavit
that they intend to export it, afterward to
retain it in bond for eighteen months I'M
der pretext of desiring to secure as favora-
BILE rates of freight as possible. If the
| market turns to suit them, they can then
sell the whiskey in this country. pay the
tax. and forget that they ever intended to-
export it. For all practical purposes, this
decision means a continued loan of many
millions of dollars to the owners of whisky
upon no better security than the whiskey
itself, which could not be sold for the
amount of the tax if forced upon the mar
ket. Under the operation of the act of
1878 more than $S1 900, 900 was thus loaned
at one time by the United States Govern
ment to distillers or the holders of whisky,
thing without parallel. it is safe to say,
in the history of this or any other Govern
ment. But this thing occurred under the
operation of an act of Congress which,
when it was passed, was not expected to
increase the production, or to swell enor-
mously the quantity of whiskey remaining
in warehouse. Having discovered what
the effect of such legislation has been, Con-
gress has refused further extension. But
now it is proposed that, without an act of
Congress, the Secretary of the Treasury
shall lend for year or two longer the many
millions of money which the distillers owe
to the Government.
1t is difficult to believe that Secretary
McCulloch will consent to such step.
The statement often heard in Washington,
that the opinion of the Attorney-G General,
though not sound in law, had become alb
solutely necessary to save great interests
from bankruptcy, points to the only argu-
ment that can be made for the measure
proposed. But it is not the business of the
Secretary of the Treasury to save people
from bankruptcy who have been for years
in vain trying to induce Congress to give
themsan enormous sum of money, and have
involved themselves by their own mistaken
hopes Of success in that undertaking.
There are several things that the Govern
ment of the United States can do with
$50, OO0, 900 o. 800, OOO,O 600 which are much
more to the interest of the people than the
lending of that sum to the whiskey ring"
Mr.. Zepheniah Phelps, aged about rs,
and living at Avon, Connecticut. has been
working on perpetual motion and cereal
navigation for many years. Failing to get
patents on his inventions, he determined
some weeks ago. to test his air ship, in a
quiet way, by himself. He repaired to
Wordsworth tower. on the highest summit
of the Talcott Mountain, about fifteen
miles from Hartford. The tower is about
100 feet above the mountain top. He con-
veyed his machine in detachments to the
mint tho xuIo1o nontr;voooo ;,ol,1:,..