The St. Louis Republic., 1901-01-14
PHRASE AND FACT.

the beginning may make troubles worse
by being suddenly imposed upon condi-
tions adjusted by long and laboriOus
effort TO other rules.
Senator Clay would interpret literally
and Immediately the principle an
nOunced In the last Democratic State
platform-that objects of local and State
taxation he separated. He would AT
once apply the rule that joint-stock con-
Germs pay the whole of State taxation.
leaving other forms of personal property
and all real property for local taxation.
Young men are prone to transfer the
easy logic of the books TO the crowded,
changing and difficult field OF social ex-
perience Senator Clay is still young
enough TO be the victim of his reading.
ST. Louis, he argues, should welcome
the change. since all ordinary personal
property and all real property would be
released for local taxation, giving 4
much larger revenue for municipal pur-
poses. This offhand proposition is open
TO several doubts. To create new values
out of taxation is always somewhat
hard to accomplish except by the old
fashioned methods of higher assess
ments or higher rates. The question Of
taxing articles of incorporation becomes
inevitably involved In the eyer-present
question of how much tazation-and
taxation is always in the end more or
less evenly distributed over the total of
all kinds Of property and all kinds of
earning abilities-a community as Il
whole is willing to pay.
Not how much it could pay if squeezed
by arbitrary power-that is not a safe
assumption by any State or town in
America; where people move freely from
place to place and do not live or invest
| money long in locality taxed to an
appreciable degree higher than other
localities in proportion to opportunities
| afforded.
Senator Clay says that st. Louis ought
to welcome his plan of separating local
! and State taxation. st. Louis now pays
| twice the amount of State revenue II
should pay. The separation would not
| be likely to reduce this proportion, since
the value Of business done and tangible
pIOptTty ONucu OuucI slA LUIS VI luCNi
poration In ST. Louis is at least as great
| in proportion to all such business and
! property in the State as the value of
! general property in st. Louis in proper
ton to the general property in the State.
Senator Clay says that assessments
are too low In the counties and in st.
Louis. In the counties, yes; a great deal
too low. In st. Louis, no; as high as
they ever could safely be under any
| system of taxation, unless the rate
| levied were greatly reduced. Hence it
is not a remote possibility that n sweep
| ing, radical change, arbitrarily taxing
business conducted under forms of in
| corporation might drive vast amounts of
business and property into Illinois and
other States, expressing st. Louis dan
gerously and injuring the whole State.
Abstractly, what Senator Clay calls
the Pennsylvania system, used to some
| extent in Massachusetts,, Connecticut,
| New York and other States, and no.
| where with perfect satisfaction, seems
to be simple solution of the problem of
| raising more revenues in localities. In
| practice it may be a solution, but IL
may be q producer of worse embarrass-
ments. Probably Senator Clay has never
calculated how much OF taxation the in
corporated business and property of Mis-
souri, are paying already. Certain forms
of personal property held by individuals
escape taxation; but not much escapes
of that held by joint-stock companies
| To start out with the assumption that a
| great and rich new field Of taxation lies
awaiting the State Government of Mis-.
] perhaps breed trouble for everybody.
The Legislature has declared. through
the private declarations of most of its
members, purpose of taxing the quasi
public corporations which receive from
the people exclusive privileges. The in
tention is right. 1t is high time that the
public should be obtaining a share OF
public business. That system of fran
chise taxation should have been applied
fifty years ago. But the thousand forms
| of ordinary competitive business. held
chiefly by small investors using the
joint-stock method of investment. should
not be rashly attacked. Only after the
closest investigation should drastic
methods of taxation be applied Il
general industry and trade. 1t is al
ways dangerous experiment and in nc
other State so dangerous as in Missouri
whose chief centers are all ON the bound
aries and susceptible to a quick re
mOval of establishments to adjacent
States. Phrases are we'll enough for tho
orator; the legislator should be careful
that the phrase fits the facts. All cor
porations are not monopolies or semi
mOnOpOlies. All corporations are moi
giants. In st. Louis, probably, nine ou
of ten are small, and probably nine ou
of ten large ones are mainly owned by
shareholders of moderate means. Il
would be mere folly to construct ia,
legislation for Missouri on the theor,
that getting even" with giant mOnop
olies is identical with an indiscriminat,
tax on joint-stock companies.