River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1905-07-20
The Status of Credits.

That credits are not property in
the ordinary acceptation of the term
seems to us SO apparent as to be in
the nature of an axiom. They are
but evidences of a business transac-
ton in which one party obligates
himself to do a certain thing in a
contingency. In the case under
consideration-the taxation of note
or mortgage-property has been
transferred for specified time, to
be returned in kind or value at a
future date specified. The property,
whether as money, lands or goods,
must pay its tax, and it does. If the
credit also pays an equal tax double
value must be assumed and double
taxation results. AS to who shall
pay the tax on the bona fide proper
ty, that is determined by an agree
ment between the parties to the
trade transaction. In the case of the
mortgaged property the person TAX
ing possession of the property volun-
tarily agrees to pay the tax while
he has the use of the property. The
question raised here is: "Why
should not the man who sold the
land and has a mortgage on it
pay the tax? Because for the time
being he does not own it, has not
the use of it and receives nothing
for its use except the stipulated sum
determined in the consideration of
the interest on the money loaned on
the land transferred. The man in
possession of the land uses it for his
own advantage, assured that he can
make more by its use than the in
terest and taxes he has to pay.
If a man sells land and gives
warranty deed he relinquishes the
land absolutely, has no further claim
on it in any event, assuming that the
buyer has paid the whole purchase
price. The sellers obligation to
pay taxes on the property is dis
charged and this obligation is as
sumed by the purchaser.
Suppose, however, that man
sells another land in this way: 81
will sell you this land for $1,000.
Ten years from the date of this
agreement you pay me $1,000 with
interest at ten per cent-$2, 900
and the land is yours absolutely. If
you fail to pay me the purchase price
the land reverts to my possess ion.
During the ten years you have pos
session and use of the land you pay
the taxes from the proceeds of the
products. The land must pay the
taxes assessed against it." An
agreement is written to this effect,
signed and recorded. This is
mortgage. Now why should the
seller of this land, pay the taxes on
the property he does not own for the
ten years? Or why should his
mortgage the paper embodying
this transaction-pay an equal tax?
The mortgage is not property.
Property is not made by the passing
Of an agreement. The man using
the land creates property.
Thirty years ago man here
bought quarter section of land for
$1,000. He then hired 81 1000 to
put into provements on this land.
He bought team, broke up 100
acres and sowed part of it to oats
the first year. From the sale or
feeding of these oats he secured
money enough to pay the interest
on the money borrowed. The next
spring he seeded the land to wheat
from which he harvested Fl bushels
to the acre. Wheat was $I.38 a
bushel. His crop was worth $3,-
726. He could not have made in
his vocation as laborer one third of
that sum. Borrowing $1,000 he
made it more than double itself in a
year and half. He paid the note
of ST. 900 and the interest of SI5o
without "kicking." In fact he felt
very grateful to the man who part
ed with his 81 900 for year and a
half for the consideration of $I5o
that helped him to put more than
the $I,I5o in his own pocket. He
thought the man who loaned him
the money had done him a great
favor, for by the use of the money
he received more benefit from it
than the man who loaned it to him.
And no man of sense will borrow
money or buy property and go in