The Washington herald., 1909-07-02

American people, IN establishing fer all
thine IN this country true cooperation
OF these three great forces OF society.
Publicity Important Feature.
I consider one OF the greatest accom-
plishments OF Mr.. Roosevelt's Presl-
Dental career. next TO his success in ere
ating public awakening and general
national uplift. was what Is known as
the pure food law. President Taft has
recommended to Congress the enactment
OF law which. IN my opinion. VIII ex-
ceed In its benefits and f1itions 20 this
country and demonstrations 10 the world
the resultant benefits OF the pure food
la" refer 20 the corporation net earn
ing tax amendment 10 the tariff bin pre-
pared BY the Attorney General of the
United states. under the direction OF tbe
President, and accepted by the Senate
committee on Finance. and by them "a
Yoraoly reported to this body. II Is not
the revenue features Of this proposed leg
islation that 7 deem so important. but
The publicity feature incident % its dem
OnstratiOn
The tendency IN all civilized eoun-
tries IS toward Capitalization. both IN
government and II business. Il VIII be
but short time before the great bulk
OF the business OF this country viii be
conducted BY large corporations or trusts
Within one or two decades We viii prob
ably see the transportation business OF
this country conducted By two or three
corporations. with capitals OF i've or more
billions OF dollars.
Personally. believe IN trusts. prop
erly regulated and honestly conducted
because the best brain and greatest ef-
hciency IN any portion OF such organ
ization must elevate the whole organlza-
ton 20 the same plane. With increased
efficiency comes q corresponding mini
rniZation Of waste Waste benefits no
one. therefore. 20 my mind. the larger
and more efficient the trust OF corpora
ton the greater the benefit 20 the com
munity and nation. provided simple but
effective laws be enacted which VIII force
these trlsts 70 recognize and protect the
rights OF men and property. and insure
the absolute responsibility OF al man
asements 20 the government in obeylng
the laws and 10 the stockholders, IN as
suring them fun information and pro
poruonate distribution OF profits
Era OF Capitalization.
Capitalization IS an Inevitable evolu-
lion incident 10 civilization. We can
not prevent this any more than we can
set aside the law OF gravitation. We
can, however. provide legalized channels
througa which large aggrcgations OF cap
ital must and can operate. IN providing g
channel through which they must operate.
we are protecting the people and in pro
vidiag a channel through which they can
operate We are enabling aggregated capl-
tai 20 obtain the best legal returns on the
con1unct!ve operation Of business acumen,
application and industry. II correct in
my assumption as 70 the growing tend
ency toward Capitalization, the resultant
necessity of publicity OF corporate &C
ton must equally impress our minds.
Under the provisions OF the admins
trstion measure before US. the President
and the members OF his Cabinet have
provided IN the simplest form for the es-
taohshment cf this great fundamental OF
publicity. for tie government. at least
viii have CogniZance OF all corporation
earnings and a method Is provided BY
which the stockholders may secure such
Information. since the returns OF the gov
ernment become public records Thus
VII be eliminated IN the future tae pos
sibility Of concealed equities. corporation
'nelon-cuttings' WI be done away with;
the responsibility OF corporation man
agement 20 al the stockholders will be
established-tbe holder OF one share Of
stock VIII have opportunity OF acquiring
es much Information concerning cOrpO-
ration affairs as the owner OF one hun
dred thousand shares. Corporations viii
be pOpularized and 'peoplorized.' the
tendency VIII be for people 20 invest
their earnings IN corporation securities
~~~
feature and greater opportunity for gov
ernmentsl supervision VIII protect their
investments and insure them proportion
ate benedts IN the successful manage
ment OF the corporation. Cooperation
viii thus be established between the pe0-
pie, the government and the large cor
poration on the assumption that the cor
porations VIII in effect. be wards OF the
government AL legitimate business
should welcome this legislation and only
the business pirate need fear and op-
pose t.
In my opinion the market value OF al
legitimate securities will be increased By
this legislation. Tor the reason that the
money available for investment IN legit-
inlase securities viii be much greater in
volume, for much OF It has heretofore
been diverted by those business pirates
who have syndicated and incorporated
hope and misrepresentation and issued
their stock certificates covering same, IN
exchange for the hard earnings OF the
people. appealing 70 human cupidIty for
large returns on small investments rather
than smaller and sure returns with safety
Of principal
WiII Invite Investments.
Mr. President. the burglars greatest
fear is the light So the business pirates
greatest fear Is publicity. 7 believe
within 6 decade after the enactment OF
This legislation that thousands Of millions
Of foreign capital VII come 20 this coun-
try for investment IN our securities on
the realization OF the European investing
public that the small stoclSholder is pro- /
tected and that the United States gov
ng that he participates. il proportion 10 /
ais holdings. IN the BENEFITS accruing to I
the corporation incident 10 its growth
Ind development and that Of our coun-
~.
Referring 10 the revenue feature. an /
Inheritance tax has always appealed /
strongly 10 me as the most Just and de- /
iir6ble means OF taxation. Next 70 that I /
avored the income tax, but the public I
" feature incident 10 the proposed tax (
N the net earnings OF corporations, 1
brought TO my attention last fail by 4
President Taft. has since then steadily 4
Town upon my mind as overshadowing 4
III revenue features and as being Of g
-reat deal more importance 20 the coun-
~ and to the world than the in
e-itanee tax or the income tax Z
one Of the States now had the
Inheritance tax and II the Supreme
'Ourt OF the United States had nor held
be income tax unconstitutional. and ei-
her the inheritance. income, or corpora
lon net earnings tax could be passed
through Congress with equal ease, I
arenr,afl.r nnrn.rr r.-iah The PrnalSert fha.