The Washington herald., 1909-07-04
(By the Universal News AnalysiS.)
SUNDAY, JULY 4, 1909.
Congressional.
NoTE-This feature. pres


is the crest Of the weeks news wave in
America Not that the big, imperturba-
bic lawyer in the White House ever es-
capes publicity as TO official acts. But Just
now with extraordinary intensity has he
been under observation at long and short
range and from almost every imaginable
angle because Of the recognized balance
OF power he holds in the politico-ecOnOmfc
struggle nearing its crisis on the hill
The one serious sentence which he wove
into his facetious talk to the Yale grads
Wednesday at New Haven was taken as
a virtual ultimatum 10 the high tariT
regulars in Congress that vital trimming
must be done TO the bill IN conference If
II IS 10 expect the necessary Taft sigma
ture. And the words Of his nearest ad-
visers in the course OF the Senate debate
on the corporation tax during the week
Indicated plainly that the President did
not agree with the Aldrich confession
that that measure was put forth merely
to beat the income tax and later to be
repealed. II was argued by them that
the purpose OF this tax was TO permit
the keeping OF Republican and Taft prom
ises as 70 downward revision and still
cure the deficit On the other hand Re-
publican advocates Of the straight in
come tax have shown decided dlstrust OF
the whole administration method Of deal
ing with the situation.
BY q vote Of SO to II the corporation tax
amendment 10 the tariff bill was adopted
by the Senate Friday.
Only three Democrats voted against the
amendment when IT was placed on its
final passage; but prior TO that, when
tests votes were had the Democrats
generally and some OF the Republicans
formed the opposition TO the measure.
Hardly had the debate on the compro-
mise corporation tax been begun in the
Senate on Tuesday when like a sudden
nash OF lightning the reply Of Senator Al
drich TO a question from Senator Clay re-
vealed the suspected altitude Of the ma
Jority toward the administration revenue
eXpedient- Clay had twitted Aldrich on
his change Of mind as TO the revenue ca
pacity OF the tarln bill and the Republl-
can leader had denied II, saying he still
thought the bill would produce enough
revenue. Clay then said Aldrich had op-
posed the income tax as an assault on the
protection system. and wanted to know
why he would vote for the tax on cor
porate earnings. Aldrich replied: Il will
vote for the corporation tax to get rid OF
the income tax That is my primary rea-
son. Another is that revenues are needed
70 meet coming deficits. II is estimated
that the shortage for the next year viii be
$9,0000o0. In two years the corporation
tax can be reduced 10 a nominal figure
or be repealed entirely. I do not desire
now to have such taxation as would de-
stroy the protective system
That clarifies the atmOspherer' shout
ed Bailey. Now we know that this is a
mere subterfuge. That is how the Sena-
tor from Rhode Island won the RepubH-
can income tax advocates away. He
promised that the corporation tax viii be
modified or repealed in Two years To /
this Aldrich would only say that the Re- |
pUblicans preferred constitutional |
course. and added that the plan had been
suggested TO the committee presumably
by the President some time ago. But he
denied that he was speaking for the Pres
ident
The corporation tax amendment had
been reported from the Finance commit
Tee favorably, Monday, but finally came
before the Senate In the way 10 force
vote on Il without amendment. The
Bailey income tax amendment TO the
tariff bin was in line and TO this Lodge
moved a substitute in the form OF au-
thority for the President to enforce coun-
etTvailing duties, To this AIdrich moved
the corporation tax plan as an amend |
nent and by the rules a vote must be /
taken hrst on the amendment 70 a substi- !
tate. Aldrich then gave the mantle OF
leadership 10 Senator Flint Of California |
and left the Capital for a brief vacation.
In reply TO questions Flint said that the /
inquisatorial features had been eliminated
from the measure and that frRternal So |
oieties would be exempt
Cummins, Borah. and other insurgents
= hao ~ a.
corporation tax camp, and next day were
able to have their way on q question OF !
adjournment. Cummins declared that the 4
President might recommend, but that as /
for him he could not follow where his \
conscience did not approve. He figured l
out a prospective deficit Of S175,OOOOO0 as a
consequence OF the Payne-Aldrfch bill
by 1911. BOrah pictured the corporation
tax as the consumers burden He in
sisted that the only escape from the
present merciless system OF taxation was
to tap the sources Of wealth where the
burden could not be shifted 10 the should
ers Of the poor.
AS reported, the Taft-Aldrich amend
ment would collect 2 per cent Of the net
income Of all corporations stock COM
panies or insurance companies above |
1900 In determining the per income de-
duction would be made for cost Of op-
Grafton. maintenance. losses deprecia-
tion and interest officers Of said COM
panies are 70 make sworn annual returns
as 20 their earnings 20 the satisfaction
OF the Commissioner of Internal Revenue.
the same to be held in secrecy fnviolate !
In case q return is made with false in
tent the tax is TO be doubled and 90 per
cent is to be- added for refusal or neg
lect to make a return. Besides this a
company may be made 10 pay & fine Of
from 81. 900 70 $1,000 and any person au-
thorized TO make return and who seeks
10 defraud shall be liable to a fine Of
s., 900 or one years Imprisonment or both.
Continuing Thursday, Borah laid the
corporation tax entirely 1T the door Of |
Taft and Wickersham, and charged that |
the opposition TO the income tax was in
the interest Of high tariff rates. Flint
Bourne. and other defenders Of the cOrpO-
ration tax disagreed with the statement
Of AldriCh that the law was not likely
TO be permanent. Root spoke At length
in defense Of the corporation tax as being
wiser on principle than a general income
tax He boldly criticised the majority
decision OF the Supreme Court which up
set the former income tax measure, and
declared that the government should
have the power 10 levy such tax in
some great emergency, although he pre-
ferred the protective system for ordi-
nary purposes Of revenue. He commend
ed the incidental publicity as one good
reason for passing the amendment Justi
the opposite OF this view was voiced
by Clapp, OF Minnesota, who said the
measure on this very point OF publicity
was a desertion OF the Roosevelt policy.
being designed % Iml: publicity IS 10
trust dealings.
BY the first Of the week the tariff