The Hartford herald. [volume] (Hartford, Ky.) 1875-1926, 1914-04-29
When We Go To War
With Mexico.
MONEY TO FINANCE CONFLICT
Will Be Derived From Tax
Placed On Beer, Tobacco
And Business.
PRESENT L. :. REVENUE SCANT

Washington. ID. c., April 81
The cost of war with Mexico. if war
is necessary, will be levied on the
users of beer. tobacco. drugs and on
commercial transactions represent
ed by checks. drafts. stock transfers
and similar dealings.
This is the usual method OF financ-
ing war. 1t was employed in the
Spanish-American War. The beer
tax was increased nearly one-thirG,
and the result was smaller glasses
of beer. The tobacco tax was in
creased in about the same proper
ton, and the dealers took it out of
the public by decreasing the sizes
of the packages. allowing the price
for standard makes to remain the
same.
The commonpst tax, the one not
ed in commercial transactions, was
that on checks. Everybody paying
by check had to have two-cent
stamp on the check, and in course
of time the check books were issued
with the stamps printed on the
checks. and charge was made for
the book to cover the international
revenue tax.
The stock exchange transfer was
theoretically aimed at rich people
transferring valuable properties in
stocks. 1t was successfully evaded
by all large firms like Morgan Il Co,
by various tricks, such as making
no official record of stocks bought
and sold OH the stock exchange. All
the nominal sales by margin of such
stocks escaped the war tax.
The beer and tobacco tax was cas-
lily transferred to the consumers of
these articles. and even the tax on
checks was handed down to ;he peo-
pie who pay the bills. In other
words. wars are financed by taxes on
the producing public, rather than
upon the possessors of accumulated
wealth.
At present revenues are scant and
a deficit is piling up in the treasury.
The first step in financing a real war
would be the issue of bonds.
These are the source of profit to
big financiers and to large banking
firms floating them, but the real
cost. which is the interest payments
and the repayment of principal,
comes out OF the consumers OF the
country through future taxation to
take care of such interest and prin-
cipal --Afs Ss~as 7
The income tax. now made thor
oughly constitutional, affords AN ex-
cellent opportunity for financing the
Mexican war. During the Civil War
a large amount of money was raised
by an income tax. no question then
being raised as to its constitution
ality. A sharply graduated increase
in the income tax codld very easily
be arranged by brief amendment
to the present incomc-taN law. The
administration of such measure
would be simple. since the returns
are in and the Government knows
who must pay income taxes.
II would be necess ary only to
send notice to those who have
paid. that their hills Will be Ger
tain per centage higher. according
to the graduated increase, which
might be made by congressional
amendment.
An inheritance tax could very
easily be added by Congress aud this
would be an even more certain way
of tapping accumulated wealth rath-
er than leyying the burden of war
on the poor producer and consumer.
The cost of a war depends entire
ly on circumstances. II the war is
short and quickly terminated. a
hundred million would do to start
with. and the cost would pile up
from this. with accumulated pen
sions and incidentals. until II reach
ed probably billion dollars. That
for short war.
II is impossible to estimate how
many billions a Var would cost that
lasted over year or two.