Gilpin observer., 1906-12-06

| STANDARD OIL company and as has been
shown since by the investigation OF the
| atiVe of big railroads OFTEN railroads
| would lie to combine for the purpose of
| ing Improper advantages at the expense
| of small shippers and of the general pub
| lie. Such a combination. instead of being
| forbidden by law, should be favored. In
| other words, 1t should be permitted to
railroads to make agreements. provided
| these agreements We're sanctioned by the
We're published. With these two condi-
tons complied with it is impossible to
see what harm such n combination could
do to the public at large. 1t is public
eviSA,o have. on the statute books law
inc - BILE OF full enforcement because
bota judges and juries realize that its
full enforcement would destroy the bust
ness of the country; for the result is to
the law against their will. and to put
premium on the behavior Of the wilfnl
wrongdoers. Such result in turn tends
to throw the decent ,nan and the wilful
wrongdper into close association, and in
the end to drag down the former to the
latter's level: for the man who becomes
a lawbreaker in one way unhappily tends
to lose all respect for law and to be
more scathing condemnation could be
visited upon a law than is contained in
commission when. In commenting upon
the fact that the numerous joint traffic
associations do technically violate. the
United States supreme court in the
Transmississippi case ana the Joint
Traffic association case has produced no
tions of the country. Such associations,
in fact. exist now, as they did before
these decisions, and with the same gen
eral effect. In justice to all parties. we
ought probably to add that II is difficult
to see how our interstate railways could
be operated with due regard to the inter
est Of the shipper and the railway
without concerted action Of the. kind af-
forded thru these associations"
This means that the law construed
by the supreme court is such that the
business of the country cannot be con-
Quoted without breaking it. / recommend
that you give careful and early consider
alton to this subject and If you find the
opinion of the interstate commerce com
mission justified. that you amend the
law so as to obviate the evil disclosed.
Inheritance and Income Tax.
1t was expected that the president
would refer in some way to his belief
in the necessity for the curbing of enor-
recommending legislation for both in
come and an Inheritance tax. He be
lieves the government should impose a
graduated inheritance tax and If posi-
Bile. graduated income tax. He says:
Il am well aware that such a subject
as this needs long and careful study in
order that the people may become famil-
lar with what is proposed to be done,
may clearly see the necessity of proceed
ing with wisdom and self-restraint. and
may make up their minds Just how far
they are. willing to - in the matter:
out the project in necessary detail But
/ feel that in the near future our nation
al legislators should enact law provid-
ing fer graduated inheritance tax by
which a steadily increasing rate of duty
should be put upon all moneys or other
valuables coming by gift, bequest or
devise to any Individual corporation.
IL may be well to make the tax heavy
in proportion as the individual benefited
is remote of kin. In any event. in my
judgment the pro rata of the tax should
increase very heavily with the increase
-. - 1-Et ttnIft agn1
after certain point has been reached
1t is most desirable to encourage thrift
and aHd "a potent esTo eupGe oS tSe ol
| part of the breadwinner to leave his chill
dren well of; This object can be attained
| by making the tax very small on moder-
| ate amounts of property left; because
| the prime object should be to put con-
| stantly increa sing burden on the inher-
| itance of those Swollen fortunes which
| it is certainly of no benefit to this coun-
| try to perpetuate.
ieal propriety of the government thus de-
termining the conditions upon which any
Exactly how far the inheritance tax
would. as an incident. have the effect of
| limiting the transmission by devise or
| gift of the enormous fortunes in question
| ii is not necessary at present to discuss
| II is wise that progress in this direction
should be gradual. AT first a permanent
| be more substantial than any such tax
| has hitherto been, need not approximate,
| Increase by graduation. to what such a
tax should ultimately be.
Inheritance Tax Constitutional.
This species of tax has again and again
| been imposed. altho only temporarily. by
! the national government. II was frst
imposed by the act OF July 3, i,s.' when
| alive and at the head OF affairs. 1t was
| a graduated tax; tho small in amount.
| the rate was increased with the amount
| left to any individual. exceptions being
made in the case of certain close kin. A
| similar tax was again imposed by the
act of July !, 1862: minimum sum of
1 $1,000 in personal property being excepted
| from taxation. the tax then becoming
progressive according to the remotepess
of kin. The war-revenue act of June 49,
| 1885. provided for an Inheritance tax on
any sum exceeding the value OF slo,ooo
ance with the amounts left and in ac-
cordance with the legatee's remoteness
| of kin. The supreme court has held that
| the succession tax Imposed at the time
of the civil war was not "A direct tax but
an impose of excise which was both con-
stitutional and valid. More recently the
court in an opinion delivered by Mr.
| Justice White, which contained an ex-
| ceedngly able and elaborate discussion
| of the powers of the congress to impose
death duties. sustained the constitution
ality of the inheritance tax feature OF the
| war-revenue act OF 1898
Is Income Tax Constitutional?
in its incidents, and apart from the
| main purpose Of raising revenue, an
| income tax stands on an entirely differ
ent footing from an Inheritance tax, be-
| cause II involves no question OF the per-
petuation OF fortunes swollen TO an un-
| healthy size. The question is in its
essence a question of the proper adjust
ment of burdens to benefits. AS the
| law now stands 1t Is undoubtedly DIM
| cult to devise national income tax
/ which shall be constitutional. But
whether it Is absolutely impossible is an
| other question: and II possible II Is most
| certainly desirable. The first purely in
| come tax law was past by the congress
| in 1861 but the most important law deal
ing with the subject was that OF 1894
| This the court held to be unconstitu-
| tional.
''The question is undoubtedly very in
tricate. delicate. and troublesome. The
decision of the court was only reached