Norwich bulletin., 1910-01-25
.A REAsonAsLE PRoFlr.r

With a tariff based upon the differ ence between the cost of production at home and the cost of production abroad, plus "a reasonable profit" the definition of the adjective becomes of vital moment to the consumer, who is taxed in order that our great indus tries, failing such profit, may not go into bankruptcy. The recent action of the internationaI Harvester company in cutting what is described as a. stock melon" of twenty million dollars is therefore a matter of concern to oth- CTS than the fortunate shareholders. Twenty million dollars is a large sum to distribute in addition to the regular dividend. The form Of distribution is one which in some cases has been for- bidden-as in Massachusetts to the railway corporations. It is stated that the Harvester melon represents the surplus earnings of only seven years. Anyone who was not satisfied with such a profit would surely be "unrea- the help of a duty of 20 per cent, re- duced in the Payne act to Is per cent, with a provision for the free adnis- sion of agricultural machines from countries reciprocating in kind. This wos one of the few instances in the measures of revision downward. Yet the net earnings for 1909. on a. capital stock of sixty millions, were fourteen millions.
 Can the officers of this prosperous trust lay their hands upon their hearts and say that they really need any tarlf whatever to ensure reasonanle profits? Have they needed 20 per cent. during all these years? To be sure, a duty of 15 per cent. is extreme ly moderate compared with what some other interests are getting; ana the free list provision has strangely no- eral aspect. As a matter of fact, the superiority of the American machines is their best protection against com petition. There is not the slightest danger of extended purchases Of foreign makes by the American farmerss on the contrary, the trust has been beat ing foreign makers in their own mar kets It now has to contend with an increased duty in France. but this ls one of those little incidents in tariff war which cannot be helped. Other protected industries will suffer in similar way if Germany begins policy of retaliation. This, however. does not affect the home market. The American farmer has been paying. and will con- tinue to pay, for melons" Of various kinds. The best tariff that ever was leaves the Ultimate Consumer out m the cold; and there he will stay until he learns his lesson and sets about electing members of congress who VIII draw up a different kind of tariff.
 In another aspect the action of the Harvester trust is interesting. It will be observed that this surplus of twenty millions represented new profits, on which the government proposes to levy a tax Distributed as stock, of course these profits vanish, so far as the gov ernment is concerned. They become a part of the capital, and the profits are represented solely by the ordinary divi- dends. This may not have occurred to the astute gentlemen who presided at the slicing of the melon" It may be simply another example of the long arm of coincidence. # From whatever point of view, the Situation has an interest for those out of whose pockets the trust has taken its extraordinary earningS-ProVidenc Journal.