New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-29
Individual Luxury
Or National Starvation ?

professor n. J. Davenport. Of Corn>' Oni-
rcrsify. ~ The ArrdHsp
Essentially fallacious is the notion
that drastic income taxes may discour-
age that productive enterprise on which
the waging of war must be conditioned
How else or how better may one invest
his funds, in view of the fact that no
matter where he invests he must rem
der TO the state the same fixed fraction
Of his income? Taxes on profits may,
il is true, cut so deep as to make any
particular enterprise unattractive as
against other investments which are
relatively lightly burdened. So, again,
a 100 per cent tax on incomes from in
dividual effort would cancel the in
centive to effort. But even tax of
100 per cent on interest or dividends,
and even tax not temporary but per-
manent, would leave an investment as
well worth keeping as giving away. 1t
is only new investments that an in
come tax could retard, and then only
by taking all of the income.
As between loans and taxes the alb
sorption of funds through loans would
the more interfere with the creation Of
new equipment and the undertaking Of
new enterprises. But doubtless either
method will somewhat interfere-and
ought and must. If the government is
to have increased ammunition, more
munitions and more and larger ships
the necessary plants must displace the
building of houses and the installation
of other enterprises. II is precisely
for the purpose of limiting other I'M
dertakings and of restricting other out
put and Of diminishing other consump-
ton that the government must appeal
either to loans or taxes in the support
of its own activities. Singularly inept
also must be the discredited slogan
business as usual The essential
meaning of war is that business shall
not be as usual.
For certain purposes, however, it
need not matter whether bonds or
taxes support the war. In either case,
certain duties become imperative for
all citizens. Clearly, whether we must
pay taxes or may buy bonds, we must
economize-the government being al
lowed to appropriate for its need that
which otherwise we might spend or in
vest at our own discretion. We must
have less to consume il the govern
ment is to have more. Somehow, by
one or the other Of the methods, or b.
both of them combined, the govern
ment must obtain control Of one-fourth
Of the output of industry-must take
to itself out of the average income
one-fourth Of its buying power.
Luxury for the individual must make
place for the necessities Of the state.
The tailors that work for us We with
hold from making uniforms for the
fighting men. We shall have to wear
our old clothes. If the farmer is to
| have the potatoes to use for seed, he
can plant only those that we have re-
Trained from buying away from him
for our own eating. If men are to be
! found for the armies, our restricted
demands must release them from the
/ factories. The more the shoes tina,
we wear out, the fewer the shoes which
will be left to keep the soldiers shod.
Fancy groceries for some citizens
mean the greater hunger of others
/ If there is cake for one, there will be
] no bread for two.
Clearly, whether we bear taxes, OF
( buy bonds, we must live meagrely OF
must accomplish weakly and wear out
early. Only as rapidly as through
the limiting of OR purchases we allow
/ the old industries of comfort or luxury
or license to wane can the new indus
= tries and activities of national safety
expand and flourish. Individual luxury
or folly must mean national starva-
| ton.
1t is, then, clear that if to save not
/ to pay taxes but only to buy bonds is
| for the comfortable and we'll to do, d
/ flabby and limited patriotism, it is
nevertheless, all that there is open tC
a people from whom the government
/ either cannot or will not demand 6
higher and a more worthy loyalty.