The record-union., 1895-05-09
JOSEPH q. CHOATES ARGUMENT
FOR APPELLANTS
The Court. Immediately Counsel
Closed, Adjourned to the Twentieth
Instant, When 1t is Expected Iha0
Its Conclusions Upon the Income
Tax VIII be Announced.


Acrs constitutionality in whole or in part
under consideration. On the 10th OF this
month the court will meet probably for
the last time this term to render its decis-
ion in pending cases, and it is expected
that its conclusions upon the income tax
cases will be announced at that time.
Joseph II. Choate of New York finished
the closing argument which he began
yesterday, speaking until O'Clock and
receiving the closest attention from the
Justices and q crowd of spectators.
1t has been generally remarked that in
terest In the hearing has been much less
intense than at the first argument JUS
tice Jackson was one of the most attentive
Of the nine men on the bench throughout
the hearing, and seems to have borne the
strain well, considering the condition of
his health.
Mr.. Choate first took up for examIna-
tiOn the argument OF the ALtorney-Gen-
eral that ii the decision in regard to
rentals was TO stand, there should be no
limit to the time the exemption should
run, The Attorney General had pleaded
that with such ruling in force 1t might
be impossible to ever tax the proceeds
derived from rents, however they might
L
that it was sufficient that the law left no
such question open. The provision was
foa taxing rents at the moment OF their
receipt, aud he, for one, should not be so
foolhardy as to claim that when the rent
money should be invested, il should not
be subject to the original ruling In court
in this case.
Mr.. Choate contended that of the vast
sum expended in the civil war very
small proportion bad beens derived from
the income tax, which was in operation
III that time.
Taking up the thread of his affirm
ative argument, Mr.. Choate declared that
the question OF taxation had been one of
the most prominent in the minds OF the
trainers of the Constitution. The men,
bers of that body were the representatives
of men who knew all about the question,
for they had studied here. as their an
cestors had in England, under the
PlantageneIS, the StuartS and the Iudors.
Mr.. Choate then proceeded on the basis
that the court had decided that lands were
to be free from direct taxes, and that
there was TO be no difference for tax pur-
poses between the body of the land and
It's proceeds. He then entered upon the
discussion OF the undecided questions,
eoutending that there were the same rea-
sons for exempting incomes that existed
for eXempting bonds and real estate.
Justice Harlan asked Mr.. Choate if he
meant by general tax on personal prop
erty tax on all personal property OF
every kind.
IN ot at ALL" Mr.. Choate replied. "Be-
cause L admit the right of exemption"
Justice Harlan-Does a tax law that
reaches only part of personal property
come under that head?
Mr.. Choate-In New York there is
vast body of citizens exempt-inmates of
tenement houses, nearly one-half of the
tfafin / Cal a
sessment, not excepting the exemption.
1t is tax that cannot be shifted. and a
tax that cannot be avoided. But the
question whether tax on real estate can
be shifted | will leave to political econo-
Inists, with whom l have no relations,
and hope never to have relations.
Mr.. Choate looked at the Attorney
General when he spoke of political econ-
omists, and there was laughter, rare
demonstration in the Supreme Court.
Justice Harlan asked If The counsel
would call tax on the income of bonds
direct tax that would have to be appor-
toned, and upon receiving an affirnaa-
tive answer, asked if the same were true
of tax on banking.
Mr.. Choate answered: 'This is busi-
ness, and the court has over and over
again decided that Congress can tax
business"
In discussing the principle of the stare
standing by former decision, whether
right or wrong, he said he was constrained
To believe two of the Justices had only
consented TO the former decisions in def
erence to that of principle. ~ our hon.
ors are sworn TO obey the Constitution
as a primal law. Every Act OF Congress
stands in the light of it or must fall
Must not every decision of this court
that it found to be in conflict with the
Constitution by the light of the latest evil
dence and the most complete informa-
tion also stand or fall ?''
Then Mr.. Choate continued: Regard
ing the statement that former income
taxes will have to be paid back if the
court reverses the Springer rule, l. sub
init that with such consequences as that
your honors have nothing 10 do. That is
not all argument addressed TO question
of law or constitutionality. a moral argu-
Inent, the Attorney General calls II. L
call it an immoral one. The idea OF the
-Attorney-General standing up here for
the nation and asking that because the
Government has collected much money
illegally in the past it must go on collect
ing money Illegally"
Mr.. Choate next considered the excep-
tions made in the income tax law, and in
doing SO made special reference 20 the
mutual insurance companies as going to
show the magnitude OF the operations OF
those companies. He could, he said,
mention one such company whose ac-
cumulated property amounted to S20f.-
000, 900. An exemption such as this was
beyond the bounds of reason.
''Do you KNOW" he exclaimed, what
this concern Is that Is given the vast ad-
vantage implied in this exemption? Ii
goes under the reputable name of a
moneyed corporation. 1t is moneyed
monster; II lives upon money; il Swal-
lows money; it digests money; it breeds
money. Ii lays golden eggs Dy the
bucketful every day, and then weaves
golden coins about them to warm and
vivify them. 1t has many arms
there are States in the Union, and which
itsis constantly putting out in all direc-
tions for the purpose OF rakfng N with.
Nor are its operations confined to the
bounds of this country alone. 1t extends
raking in money"
Having obtained SO much money. he
said, the company reinvested 1t by form
ing trust companies, organizing banks.
building and reorganlZing railroads and
floating Government bonds. Not only
this, but it controlled Congress, and di-
rected legislation, as had been confessed
by the Attorney General.
Referring 20 the exceptions of incomes
of less than $4,000, he said that provision
of the law would exclude the vast ma
jority of the incomes of the whole coun-
Try; it would exempt ninety-nine one
hundredths Of the tradesmen of the
country, and majority OF the profess
sional men. 1t was an arbitrary blow
aimed at corporations, in hitting which
the trainers of the law we'll knew they
were striking st the main source of in-
come of thousands of widows aud or
phans, whose incomes, individually
small, were derived from corporate in
vestments.
With this Mr.. Choate closed the part of
his discourse directed to the question OF
lack of uniformity, and took up the last