Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-04-22
TARIFF REWSERS
SUBMIT HISTORIC
ECONOMIC REPORT
Underwood Committees Rec
concentrations Offer Rev0lu-
tiOn in Fiscal System of U. S.
INCOME TAX CLAUSE
INSURES FLEXIBlLITY
AboIishes Protection Afforded
Industrial Pirates, Who Exact
Bonus Without Fair Return.

WASHINGTON, April 22.-Preseni- :
ing the completed Democratic tariff
revision bill to the House today. the
Democrats of the ways and means
committee recommended a radical re-
adjustment of the entire fiscal policy
of the nation. They proposed to make
an income tax the means of accurate
ly adjusting the funds to be raised
by taxation to correspond with neees-
stiles for government expenditures.
The report, submitted by Chairman
Underwood, after outlining the opera
tions of the proposed income tax,
said
THE revenues from all income
taxes readily respond to change of
rates, and the latter can be raised or
lowered within few days time with
out business disturbances such as
general tariff changes occasion.
1T is believed that a budget or
other effective system by which Con-
gress may be able closely to calcu-
late and determine in advance forth
coming expenditures will soon be de-
vised, in which event it should be-
come easy to maintain a close bal
ance between expenditures and reve-
nues such as is practised in most
other civilized countries
VIII Prevent Deficit or Surplus.
with other sources of revenue re-
vised to an honest and fixed basis,
and the income tax a permanent. part
of our revenue system, and at all
times affordlng a substantial amount
of revenues, Congress could, and, il
necessary, should, annually raise or
lower the income tax rates in such
manner as would prevent either a de-
ficit or a surplus in the Treasury.
This combined tax system would af-
ford justice In taxation, hexibility
and stability of revenue, and rigid
economy in expenditures"
The Democrats, quitting their policy
In the preparation of the bill. an
nounced an absolute disregard for the
cost of production theory as regu-
latory of tariff rates. and declared
that in the pending bill they had at
tempted:
ITO eliminate protection of profits
and to cut off duties which enabled
Industrial mana gers to exact a bonus
for which no equivalent is rendered
"To introduce in every line of in
dustry a comparative tariff basis pro-
viding for substantial amount of
importation to the end that no con-
cern shall be- able to feel that it has
monopoly of the home market
gained other than through the fact
that it is able to furnish better goods
at lower prices than others"
(Which Is the Better Course?"
(which is the wiser course for our
government to take?" the report
asked, the one that demands the
protection of profits. the continued
policy of hot-house growth of our in
dustrles--the stagnation of develop
ment that follows where competition
ceases-or, on the other hand, the
gradual and insistent reduction of our
tariff laws to a basis where the Amer
lean manufacturer must meet honest
competition. where he must develop
his business along the best and most
economical lines; where, when he
fights at home to control his market
he is forging the way in the develop
ment of his business to extend his
trade in the markets of the world? In
our judgment the future growth of
our great industries lies beyond the
seas
A detailed table was presented
showing, by schedule, the total reve-
nue. secured under the Payne law for
1912, and the estimated revenue under
the new bill for twelve month
period. The table showed that in 1912
1883, ,209.915 worth of imports paid $S04,-
597, ,035 in duties, at an equivalent
average ad valorem rate of 4012 per
cent 1t is estimated that under the
new bill $1,000, 999 900 worth Of i'm
ports would pay $266, 7O1 900 in duties,
at an average ad valorem rate of 1880
per cent. Thus the new bill would
raise $37, 1896, 900 less than the present
law.
THE saving thus made in revenue
collections" said the report, ''is only
suggestive of the immensely greater
saving secured to the public by the
probable change in prices resulting
from the removal of the excessive
rates of the present law
TRANSFORMATION in Economic Life.
SIT is a striking fact" the report
declared, that during the years sub
sequent to the renewal of the policy
of high protection In 1897 there has
been a radical transformation of
American economic life in many di-
rections and that in most cases a
connection between the rates of pro-
lection and the development of unfair
or. Objectionable conditions has been
fully established
The increased cost OF living was
mentioned as the most striking eco
nomic change needing adjustment
through the tariff, and table was
submitted showing the percentage OF
increase in wholesale prices of many
articles in the period from 1897 to
1910.
The table gave the percentage of
increase since 1897 to 1910 in farm
products as 1872 per cent: food. 46. Z
per cent; clothing, $685. metals and
implements, 4S.2; drugs and chemicals,
23.9; housefurnishing goods, 24.2; mis-
celIaneous, 44.5, an average increase
in such commodities of 46.7 per cent.
In close conjunction with the high
cost of living, the report suggested
the development of trusts and indus
trial combinations during the same
period. and gave a list Of 226 such