The morning Astorian. [volume] (Astoria, Oregon) 1899-1930, 1904-12-31

My general purpose is to analyze
the system of taxing railways in the
United States and to trace its develop
ment in such manner as to show that
there exists peculiar element of vail
ne in railroad property, and that the
analysis of this value will lead to the
enunciation Of certain principles.
which. carried to their logical conclu-
sion. viii ultimately separate the fiscal
treatment of railroad property from
other property.
'The problem presents itself to the
legislator and the tax assessor to ar
rive at true measure of the surplus
value. meaning by surplus value, a
value of the business as going con-
cern in excess of the inventor value of
its physical elements.
"The analysis of this surplus value
shows 1t to arise from franchise con-
sidered as the right to be and to which
is superior to competition; the pos
session of other traffic which by virtue
Of connections and established contract
and agreement Is superior TO COM
petition: the peculiar advantage en-
joyed by railways traceable to the
economies rendered possible on ac-
count of the increased density Of traf-
fic.
The general conclusion of this
analysis is that the surplus value Of
railroad property rests upon the pos
session of differential gain -differen-
tial when compared with properties
other than railway properties (which
balance sheets are subject to COM
petitive infiuence) or differential when
a railroad with dense traffic is COM
pared with a railroad with sparse traf-
fic. This surplus value is monopolistic
in its character in the sense that all
unusual advantages which cannot be
dissipated by competition are monop-
olistic.
THE surplus value is peculiar toI
railways and other similar industries.
1t cannot permanently exist for manu-
featuring industries.
THE trend in the law of railroad
taxation rests upon the necessity of
applying different principle of tax
alton to the surplus value of railways
from that which is applied to the value
of the physical elements which under
lie it, or to the value of property in
general which is exposed to competi-
tion. When cases which involve the
analysis of this surplus value come to
the consideration of the courts, the
courts will be obliged, in applying
established principles of justice and
equality to these newly disclosed facts,
to acknowledge difference in the So
cial and industrial character of thel
physical and non-physical values of
railroad properties; and it lies at least |
within the possibilities of the case that
the ultimate analysis Of this nom
physical or surplus value will result /
in the declaration of a quasi si-public |
property corresponding roughly to the
current conception Of a quasi public
industry. Should this conception be
entertained by the courts it would re-
suit in radical demonstration OF the
established physical system"
Foreign Trade.
Prof. Adam Shortt of Queens uni
versity, Kingston, Canada, read a pa
per entitled, Preferential Trade Be-
tween Canada and Great Britain" He
said in part:
ANY system by which Britain and
Canada might attempt to tie them
selves up to a mutually preferential
trade is open to very serious objec-
tions. The colonies have no possible
compensation to offer Britain for the
revolution in her foreign trade and
shipping which the adoption of a pro-
tective policy in their interests would
involve. On the other hand, Canada
is a country undergoing rapid expan-
sion, which already has involved i'm
portant changes in her economic con-
ditions. With all the varied possibil-
tiles of her internal development and
future trade relations it would be very
unwise to tie herself up by hard and
fast commercial treaties with any
country whatever. Entire fiscal free
lom is absolutely essential to her ef-
fective expansion, and free trade in
capital is more important to her than
either free trade. or preferential trade
N goods. vi
So far as preferential trade is under
aiken by the Canadian parliament in
he interest Of Canada, the action is
reasonable. This is the basis
II our existing preference on British
goods. and Of our still greater prac-
ical preference on American goods.
like treatment of Canadian goods by