The times. [volume] (Richmond, Va.) 1890-1903, 1896-12-12
SATURDAY, DECEMBER II 1896.
A PEHNERsiON OF THE TAXING
POWER.

The Times Is abundantly supporter III i'S
position that the Federal government mas
no right 10 put prohibitory tax on the
circulation of State banks. II Is true
thai the Supreme Court Of the United
Stetes decided in the Weary case that
this tax was not contrary to the Constitu-
ton, but the two dissenting justices SAID:
LAS we have seen, the power 10 incor-
porate banks was not surrendered TO the
Federal government. but reserved to the
States, and ii follows that the Consttu-
ton itself protects them, or should pro-
tect them. from any cncrOachment upon
this right. A. TO the powers thus re-
served the States are as supreme as be-
fore they entered the Union ana are en-
titled TO the unrostrained exercise of
them" "Our purpose is TO show
how important IL Is TO the proper pro-
lection of the reserved rights of the
States that these powers and preroga-
gives should be exempt from Federal tax
ation, and how fatal TO their existence,
permitted" And again: 1T Is true
that the present decision strikes only
az the power TO create banks. but no per-
son can fail to see that the principle in
volved affects the power 10 create any
9th er description of corporations. such
as railroads. turnpikes, manufacturing
com panies and Others"
Moreover. Hon. S. S. Cox, in comment
ing on the decision of the court in this
case used this language.
I'm effect this decision denies the exis-
tence of the sovereign power in the
States TO charter banks of issue pow
er which they hod freely exercised al
most without question from the forma-
ton Of tho Union until 1864. The fullest
consideration was given to this question
by the Supreme Court i'm 1897 and Ii was
decided that there was no limitation I'm
the Fee deral Constitution on the sovereign
power OF the States to charter banks of
issue. Three times thereafter this decis-
ion was affirmed by that court. No Qucs-
ton could have been better settled. yet
az a. result of war legislation. the ma
tional hanks have exclusive power TO is
sue paper currency. No judicial act of
the Supreme Court has tended more to
centralize power in the Federal govern
ment than the decision in the Weary
bank case"
For our part we cannot see upon what
possible presext this tax can be justified.
There is no function of government quite
SO dangerous as the power to levy taxes.
1t is most serious thing for the Gov
property and take any part thereof for
It's own use. and 1t is a well-established
principle that when the Government takes
moro OF the property OF its citizens than
Is necessary to the expense OF government,
economically administered. taxation be-
comes robbery, pure and simple. We con-
cedc. OF course, that every citizen must
pay OF his possessions 70 support the
Government. but we deny that the Gov
eminent has a right to exercise the power
OF taxation for any other purpose
than that OF raising revenue For
that reason we contend that the
whole system OF tariff taxation for
protection is wrong and. vicious.
and for that reason we denounce the
prohlbitory tax on State banks OF issue.
IL the Government has the right to tax
out OF existence The issue OF State banks.
why may II not exert the same power 10
destroy the banks themselves?
But. II has been adroitly asked. how is
issues is not tax for revenue? A sum-
Client answer were the fact that this tax
has never yielded a cent Of revenue since
II was first imposed. But. in addition 10
this. Senator Sherman. who drafted the
bill, not only confesses. but even boasts
OF the fact in his recent book. that the
tax was imposed for the purpose of de-
stroyins State bank notes In the interest
OF the National bank system. II there
was ever any doubt on this point. Mr..
Sherman has removed II. The Govern
ment IS deprlviug the States OF their
rights. and doing so by a vicious ana
Unconstitutional exercise Of the power Of
taxation.