The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1896-01-09
TAXES ON MONEY.
A Plan Whereby HOarded Cash Could
he Made to Pay Its Public Share.

TO the Editor Of the Indianapolis Journal:
From the best information obtainable it
Is not extravagant to assume that not one
dollar in ten Of the actual cash in this
State Is returned for taxation, even after
deducting what is used in the daily transac-
tions of commerce. There are millions of
dollars boarded in sums varying from the
small savings Of the laboring man or the
frugal domestic to the tens of thousands
of the weather.. very little, if any of
which finds it's way to the tax duplicate.
Some of this is deposited in the neighboring
bank. awaiting a demand for more profit
able investment or for sickness and there
it lies. often for years. paying no taxes
and usually drawing no interest, while occa-
sional developments reveal surprising
amounts of gold and silver and greenbacks
carefully concealed alike from the burglar
and the tax gatherer. Now, any scheme
that will add these millions TO the lax dupli-
cate should be encouraged. II, in addition
to the benefit it would be to the State. 1t
can be made even greater benefit to the
holders or such wealth, the obligation is
more than doubled; while ii is still augment
ed by meeting the obligation of the State
to provide some convenient and safe way
for investing the small savings of frugal
people. si
~
cable. II Is TO fund our immense State,
county and municipal indebtedness in small
non-taxable bonds at a low rate of inter-
est, say 3.65 per cent Demagogues have
howled themselves hoarse all these thirty
years because the money of the 'bloated
bondhol1er'' was exempt from taxation.
whereas his money has been the only
money that never escaped the tax gatherer.
From the issue of the first bond till to-day
the interest paid on bonds has always
been from to per cent. less than inter-
N
security, and the exemption from taxes
has always been controlling considera-
ton. In other words. the taxes on govern
ment bonds are recouped in advance, the
difference between current commercial in
terest and the interest paid on bonds al
ways being sufficient to cover both the
taxes and the possible greater risks of
mortgage or other securities.
The average rate of interest paid by the
State and the counties and municipalities
is but a fraction lessr than 6 per cent
about $50, leaving margin of per cent.
to go to tax account, which will pay all taxes,
State, county, city, school and special That
in less than ten years our entire State,
county and city bonds could all be carried
by our own people II non-taxable bonds
were sold in denominations Of s25 and dupli-
Gates, at 1865, cannot we'll be doubted. These
bonds would find purchasers in that class
of laboring men and women who want to
save something for the future who are
doubtful about the security of other invest
ments. OF course. do not mean to issue
such bonds in quantities that will require
syndicateS to buy them on speculation, as
seems to be the case of the so-called ''popu-
lar loan" now talked of in government cir
cles. / mean quite a different thing, the
details of which / need not give further
than to say that they should be of easy
child who has SIS he has no immediate use
for, and this not for month or year, but
for all time, unless the experiment should
develop difficulties not easily foreSeen.
There can be no reasons why this scheme
should not be carried out by this State; but
there are several reasons why 1t cannot
be and will not be. First, there is no man
or set of men sufficiently interested person.
ally TO mature the plan, draw up the bill
and lobby ii through the Legislature 1t is
a notorious. but humiliating lact that, since
the adoption of our present Constitution,
limiting our legislation TO less than fifty
days in two years. no measure OF impor-
lance, good or bad, has been adopted that
had not first been matured by an interest ted
lobby and then engineered through by one
device another; and there never will be.
1t is morally impossible for such measure
as this involving so many important de-
tails, to be matured without the aid of a
lobby in the short time allowed for our leg
islation. On the other hand, there are
powerful influences that will fight it from
the beginning. The Eastern bondholders
will oppose it. Indiana bonds are among
the very, best. whether State, county or
municipal; their present and prospective
holders will not allow them to be taken
from the market and they know full well
how to prevent it. In In the SECOND ;l place,
bondholders in their hostility. The depos-
itors in banks whose money is most desired
are not the merchants who deposit 5000 to-
day and check out $4,000 tomorrow. The
farmers and laboring men who keep small
balances from year to year, without inter-
est, are their best customers. This scheme
would soon transfer such customers from
the bank counter to the safety vaults. But
last though not least. would be the army
of building and loan associations, which
would swoop down upon the Legislature in
troops. What they can do to prevent legis-
lation We had a sample of last winter. 1t
would cripple. il not ultimately kill, this
modern invention for supporting a host of
salaried officers at the expense of the poor.
The scheme suggested is desirable, but is it
possible? u. IL. SEE.
I,d;ananoI;S Ton