The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1902-09-17
LET The TRUSTS Be TAXED |
Senator Morgan's Remedy for the
Trust Evil.

He Shows that the Taxing Power has been
Used TO Correct Other Evils, or
Alleged Evils.
/ Washington, September 10.-Senator
/ John T. Morgan, of Alabama, has
! made an interesting and important
contribution to- the literature of the
trust question in letter, published in
! Washington, written In reply to re
! quest for elucidation of his meaning
when he recently, declared the remedy
for the trust evil to be to tax the
trusts. -
After discussing the power of Con-
grsss to use the taxing power to regu-
! late business matters, and citing the
taxing of the circulation of State
i banks out OF existence and the regula-
tion, of the manufacture of oleomarga-
rine by means Of taxation as instances
| Of this use, which had been upheld by
the Supreme Court of the United
! States, Senator Morgan says:
Corporations are the nesting places
/ of the combinations that are called
trusts, for the reason that the risk of
the heavy operations necessary to give
them controlling power are too great
teyen for the boIdest audacity Of those
who have large capital and extensive
credit, and such risks are covered
largely by The shelter that corporations
afford their stockholders against per-
sonal liability.
IF the corporations can be con-
trolIed by law, so tnat such combina-
tions viii be severely checked, if not
prohibited, the public evil will disap-
pear. Therefore the remedy by taxa
tion will be efectual for the protection
of the people, if 1t is limited to cor
porations.
Such combinations among nataral
persons are treated as partnerships by
the Courts under the principles Of the
common law, and they are too risky
for the personal ventures Of large
capitalists.
:. A monopoly in any branch Of trade
or industry is tax upon business
that consumers and laborers must pay,
and tbs imposed without just right
and often in direct contempt of law.
SO that the general welfare is protect
ed by any laws that can reach the
monopolies. and especially by laws,
which are designed to support and pro-
tect the general welfare under the Con-
stitrtion.
8 The general welfare demands the
taxation OF corporations rather than
to add TO their special privileges by
e9empting them from just share in |
the burdens of government, and this
principle is acknowledged in many
State and Federal laws.
Outside the limits of express
restrictions there is no power of gov
eminent that is so supreme and far
as 5he power to levy taxes.
There is 8 rightful discretion in
;he exercise OF the power OF taxation I
znder the Constitution that is neces~
'ayys element of such power, and it
'elases TO the general welfare, as
pecial function OF the laws Of taxa
ion, conhded to their protection
This is especially exenpliSed in
he taxation of opium and intoxicating
squors, which are taxed for the pur-
ose Of repression as articles of COM
1srce, .aDd also for the preservation !.
{ peace and public morals.
:" 1t is Also a wholesome exercise Of |
tlibutive justice that corporatsons |
.eaied by law should be taxed to the.E
,l extent that they tax the, people by
10 abuse OF the powers given them
sruagh tire creation Of monopoEes
I'd trusts. OF which they are She !
riDeipal incabators |
sThe plan would suggest, In a6da-
on to the Sherman law, is a gradn-
ed tax on all business corporations,
iti1 an exemption. in whole OF In
art, as to slch as can establish to the 1
.sissactjor of the Government thas I
10y are not engaged In any agree
cents or combinations tkat are intead- |
to control the prices OF the cost OF
:anspoFtatl0n, OF commodities that a1e
the descriptions that enter into
omestn or foreign coamerce. i
The power thus exercised is SIMPLY
be taxing power and IS not necessarily
onnected with the power Of Congress
. regulate cammeree between the
tates or with foreign countries
1T is the application of tha prin-
iples of taxation that are wels settled {
0 corporations that have MADE agree
nenSs that violate the purposes for
which they were created, to the injury /
& competitive trade and the general
Welfare. 7
"The formulation of such tax Law
.annot be difficult task to those who
IRE qualified for such work, and it IS
not necessary for me to submit dsaft
ii such an Act to illustrate the simple
propositions on which ! rest the power
Of Congress, or Of the States, TO pro-
tect the country aginst the usarpation
of power by combined capital and
credit that now threatens 60 engulf |
all industries, domestic and foreign, in |
one enormous concentration in few |
hands of the alleged powers Of corpora |
tions.
"They cannot be supreme over the
sovereign authority from which they
derive their existence, and the Govern
1nents of the States and that of the
United States will become the vain
mimicry OF civil rule if they cannot
nnt "a hook in the nose of Behemotn'