davidaulloa/AmericanStories huggingface dataset:
New-York tribune., 1917-12-02
Railroad Officials Best Able
To Unite Transportation Knot
Government Is Finding Plenty to Do, Economist Says Without
Taking Upon Itself Work tor Which Men Have Been
Well Fitted by Long Training and Experience

riers should be subject to the Fed.
eral government, and not to the
states, as regards the issue Of Sc
curities.
1t is likewise desirable. but by no
means probable, that Congress DEF
ritely empower the Interstate Con.
merce Commission 10 regulate intrs
state rates when such rates contrcl
or affect interstate rates. Enactmen,
Of such law by Congress would Do
much to unity and nationalize rail-
read rate regulation and would be
helpful alike 70 the railroads and
the public.
Advocates Liberal
Rate Policy
In the matter Of rate regulation
the policy Of the Federal government
should, especially during the period
cf the war, be liberal. The railroads
should be allowed TO increase their
rates as much az may be necessary
10 obtain the revenues required t
keep their properties in good condi-
ton and 10 replace worn out equip
ment and facilities. The difficulty
Of securing new capital during the
war will be so great that the rail.
roads must rely more largely than
has been customary upon income, in.
stead of upon the sale Of securities,
for the funds necessary to maintain
and improve their properties.
A law should be enacted at once
permitting interstate railroad con.
panies 70 change from state 10 Fed
eral corporations. II is doubtfui
whether such law vii be enacted in
the near future. but the arguments
ere in favor Of it, and the statute
would doubtless be Of some assist.
ance to the railroads in meeting the
critical situation created by the war.
Probably it would be best not 10 con-
slider compulsory Federal incorpors.
ton Of railroads at the present time,
but permissive incorporation under
the laws Of the United States ough,
to be made possible at the earliest
practicable date.
Possibly the government will find
it necessary to advance large sums
of money to the railroads during the
war. or to underwrite (guarantee
Interest on) the bonds which rail
roads may need to issue TO secure the
funds to enlarge their terminals and
TO increase the number Of ears and
engines. Such a measure should be
adopted only wnen its necessity IS
unquestionable. 1t is TO be hoped
that the government will, through
permitting higher rates, enable the
railroads to secure revenues large
enough 10 meet their indispensable
financial needs without receiving
subventions from the government.
Government subventions are expen-
sive to the public and they tend to
weaken rather than to strengthen
those that receive the aid.
New-York tribune., 1917-12-02
A Way Out of
The Difficulty

Now, take the earnings for the
current tax year and compute them
in exactly the same way. This per
centage we find to be now 20 per
cent. The capital may have dou-
blcd; it may have been multiplied
a hundred times. And the net earn
ings may have gone up or gone
DOWN, as you like. All we want is
the percentage computed in exactly
the same way as in the three years
preceding the war. Then Of the in
creased percentage Of net earnings
the law could take, as now, any
portion which our war necessities
rcquire-say, 20 per cent on the first
New-York tribune., 1917-12-02
New Excess War Profits Tax Law
A Maze Of Legislative Bumderng
Dc Powers Conferred Upon Administrative Officials Enable hem an Analysis
Shows, Interpret Measure They Choose, and Under ANY
Construction Gross Injusice Can Hardly Be Avoided

earnings fer the same three years,
and then find what percentage these
average earnings are Of the average
capital or property account. Sup
posing, for figure, the average net
earnings are 100000 year. This
means that the average earnings OF
this corporation for these three
wears were 10 per cent OF its COM
puted investment or capital. II
would not matter in the least what
this percentage is. 1t might be 2
Per cent or 20 per cent or 200 per
cent. And in the same way it would
not matter remotely how large or
small the estimated capital or the
estimated earnings. I say esti-
mated, because practically all earn
ings and all capital figures are more
or less arbitrary. All that is want
ed is a percentage which will serve
as a base.
New-York tribune., 1917-12-02
By Carl Snyder
Aufbor Of american Rdiir0ys az
luuestments," Etc.

iUJNOT OF tWtfN"t N'"''N' y
Tnuestments," Etc.
DEAL Of misunderstanding has
n been spread abroad regard
ing the new excess profits
tax law. A weekly magazine OF I'M
ncnsc circulation. for example, con-
tains a sensational article to the ef-
feet that persons in modest lines OF
business. as milliners and dress
makers, and all those who have only
a very small invested capital, viii
rave 80 per cent or 70 per cent Of
their entire income taken away from
them. OF course, this is just rub
b:sh. as the editor OF the magazine
could have found out by asking any
competent lawyer or from fifteen
minute examination Of the law.
Practically speaking, the law ap-
plies only TO individuals with over
$4,000 net income and firms and
corporations Of more than $4,000,
and as it applies only to businesses
which are making very large profits
on their invested capital, there Is
here little ground for complaint.
The real evil Of the law is that 1t
Is perhaps the most despotic and
-
arbitrary piece of legislation OF this
generation. IL may be entirely
needful. but it is none the less just
what | say, because it gives to one
or two men, the Commissioners OF
Internal Revenue or the Secretary
Of the Treasury, practically the
power to fix the value Of the stock
Of every corporation and large busi-
ness in the United States. As the
earnings Of these amount to many
billions Of dollars, it will be, seen
what a tremendous weapon, political
or otherwise, the law may become.
New-York tribune., 1917-12-02
Old Methods in
the Scrap Heap

The railroad companies and the
government are earnestly seeking to
find means and methods OF proyld-
ing the transportation required by
the commerce Of the country and by
the army and navy. The railroad
companies are resolutely casting
aside old methods of operation. At
the outset of the war they created
what is popularity called the Rail
roads War Board, comprised of five
executives from five different sec
tions of the country, and the several
railroad corporations have vested in
this board and the committee subject
to it power to use the railway lines
and equipment in the way that will
enable the board to secure the great
est possible transportation services.
The Car Service Commission, with
the sanction of the Railroads War
Board. is using the aggregate rolling
stock of all roads in the country to
supply transportation demands as
they arise in different sections. The
old car service rules, which were in
tended to assist the owners of cars
to retain possession Of equipment,
have been abolished and new rules
adopted based upon the pooling of
equipment and its use without re-
gard to ownership.
New-York tribune., 1917-12-02
\ Matter of
Interpretation


This is the law: Corporations and
all persons doing business IN the
country are assessed taxes in pro-
portion to the percentage Of their
net earnings on their invested
capital" But the determination OF
what arc met earnings" and in
vested capital" is left absolutely to
the Treasury authorities and prac-
tically 70 the district collectors OF
internal revenues and the horde of
deputy collectors, inspectors and
agents that will have TO be created
IN order to carry out the provisions
&C. this fantastic law. Practically
speaking, beyond the exclusion Of
BORROWED money" which includes
bonds, debentures and every form
# Indebtedness and all surplus not
actively employed in the business,
the amount of invested capital" and
IN. amount OF met income" on
which the tax should be paid are TO
Jc fixed by a lot Of govern
ment clerks. There is no recourse.
The law provides the foundation
for building up the most sinister
political machine this country ever
saw.
Take a concrete instance. The
United States Steel Corporation has
outstanding stocks and bonds OF a
little over a billion and a half.
What is its "invested capital? The
law does not say. The Commissioner
OF Internal Revenue must do this.
We only know that bonds and other
indebtedness are ruled out.
This leaves billion of stock, COM
mon and preferred. How much OF
this represented 'ine sted capital"
in the sense Of the LAVE No human
being can say. 1t might be all OF
il or none Of it. The Treasury
might rule that all Of the plants
we're paid for with bonds and that
the stock was entirely promoters
bonus. In part it avowedly was.
There was a time when Wall Streets
own valuation of the stock, both
preferred and common, was about
Si50.O0O.000. 4 large part OF the
present owners paid for this stock
or basis nearer TO S750,000,0 900.
IL is now worth in a cash market
about sI,OOO,OOO,OOO. Which figure
shall be taken?
There is TO be included in "in-
vested capital the undivided sur
plus and profits which have actively
l,cen employed in the business. Ac-
cording to the books Of the cor
Loration this amount now stands
net at about S6O0.000,OO0. In the
seventeen years Of its existence
the corporation has doubled its pro-
iuctive capacity. How much Of this
doubling was due TO this reinvest-
men. Of surplus earnings? 1t is
absolutely for the Commissioner OF
Internal Revenue and his appointees
N say.
$1OO.000,OO0 or
$250,000.000
And as q result Of what they say
the tax which the corporation must
fsy this year will be anywhere from
. little over slOO,OO0,OO0 to per-
laps $250,00O,O0O. That is what
the law means.
Can the corporation or any hold
ing company, with widely dis
New-York tribune., 1917-12-02
By II. S. Oakley
British Economic Expert


LONDON. Nov. 20.-War needs make
governments ruthless, and it is ineyita-
BILE that some hardship and loss must
be incurred by sections of the COM
munity whose interests may be affected.
This is one Of the lessons which Amerl-
can business men have to learn.
1t is possible that the experience Of
Britain extending well over three years
may enable the American government
and those they intrust with the duty OF
communicating supplies of all kinds to
avoid inhicting hardship and suffering
where it is unnecessary. This should
be especially the case in large CONNER
cial transactions involving huge pur-
chases both at home and abroad. Al
though the policy adopted by the Brit
ish authorities of eliminating the mid
dleman had for its object the control OF
prices in the interests Of the consumer
and the prevention Of profteering,
some Of the methods employed have not
always conduced to this end. Let US
consider a few concrete examples.
When the British government decided
to take over the control OF wheat it
wisely decided to leave the handling of
the purchases and the general market
ing in the hands of the trade. Impor-
tant firms which had for many years
been insuring Britain's wheat supply
were appointed to act under the au-
thority OF the Wheat Controller. The
necessary disorganization was thus re-
duced to a limit. Unfortunately, this
wise policy was soon discarded, and
when the whole metal trade was
brought under control the business men
who had previously handled the whole
marketing end of the industry we're
ignored.
The Case of Pig Iron
For generations past, for instance,
ell Cleveland pig iron had been sold to
the various pig iron users throughout
the country principally through the
leading merchant houses, who had in
vested large sums in coasting steam
ers, canal lighters. horses, carts,
stables and depots, thus providing the
necessary machinery for handling the
business. When the control was in
stituted only the makers were consult
ed and every effort was made to induce
users of pig iron to obtain their sup
plies direct from the makers. Loyal
customers Of the merchants who saw
no national advantage in changing
from one set of machinery to another.
and decided to continue to buy from
their regular pre-war suppliers, have
had to pay l = per cent commission for
the privilege of so doing. Many OF
them have continued to suffer this
penalty rather than comply with the
repeated requests from the Ministry
Of Munitions 10 buy direct through its
agency and ignore their old established d
connections.
Another illustration may be found in
the action Of the government in taking
over the export trade in tinplates and
black plates. The merchants who pre-
viously handled the business have spe-
cisl technical knowledge of the many
problems of quality, grades. substances
and packing, while they have important
well organized facilities for buying. de-
livering, shipping. forwarding, insuring,
etc. These exporters have established
widespread connections abroad, and tho
dlscontinuance Of these connections
New-York tribune., 1917-12-02

Trcasurys
Vast Powers
What now is the taxable invest
ed capital"-the s2,000,0O0 OF &C
tual capital, or the two, three or
four hundred millions of actual
worth? No human being save Sec
rotary McAdoo, and no rule or
formula could say, because the law
says that if the Secretary Of the
Treasury is dissatisfied with the rep
resentation Of any company, firm or
individual he may set aside their fig
ures and fix. according TO his own
Individual notion or whim, what that
amount of invested capital ought to
be. If any one believes that this is
any exaggeration he is referred to
the exact language of paragraph 2lO.
Perhaps the reader will have be
gun to see from the illustration
given the basic injustice and in
equity of the law. AS any one can
see. the effect of the law is to i'm
pose a heavy fine upon conservative
capitalizing Of business and to en-
courage and promote every kind OF
scheme of investment imitation, cor
poration Juggling and bookkeeping
chicane. Take the two illustrations
given.
| have computed that if Mr..
Ford's company be taken at even
the book valuation Of its invest
ment, at a hundred million or more,
+. will pay about 30 per cent of its
income under the excess profits law.
This does not include the straight
per cent Of corporation tax. On
the other hand. If the book value OF
the United States Steel Corpora
tion's investment be accepted, this
will amount, bonds, etc, deducted,
to over billion dollars, and on
estimated earnings for the year the
corporation would pay only about
SO per cent under the excess tax.
Of course, under the law Mr.. Nc
Adoo might say-or Mr.. Roper might
say. and Mr.. McAdoo approve-that
Mr.. Ford's actual investment" was
not less than four or five hundred
MILLIONS, because he is earning
hundred million this year, and prac
tically all other motor car COM
panies will represent to Mr.. McAdoo
and Mr.. Roper that their actual in
vested capital is not less than four
or five times their earnings for the
year. II they 90 not, then their
capital issues Of stock are fictitious,
CT, if you please, fraudulent. And
on the other hand. Mr.. Roper and
Mr.. McAdoo could rule probably
that the Steel Corporation origin
any nov 80 -" l''N - p-' " 90
anu ''i"' '',' '"iu0 VI v"0 p'0r0-''
was more than covered by the issue
of bonds. And so these two men
i"'e'' u'' !" ' ''' N.N
way 90 ~ VIZ fi'"' '''' - ''''e'
" OH '"c ~ '''''''','N n' w r.
"''V'', u''''9 OI'''' ., .Ns-i, - ~ -,
anu '"' 0"p''"' ",u ' '''eD
'''' i'iuUs'' TO anu '"'' -
u'euS u ',ouS""u' y, ~ '"'"' NV
inco' poi "''u' Win" WI" nav ~ pay
''''' '"H'
avv NIav
NOT Otdhu
I DO not believe that such law
can stand. The courts may rule
that il is a war measure and that
The revenue must be provided in
some way. and that the collection
Of billion or two OF tax must be
left to the wholly arbitrary decision
of these two men. But 90 not De-
leve that Congress can AFFORD 10
continue tins law because the ma
tion cannot afford to have such a
powerful lever for discrimination,
injustice and lnequlty thrust INTO
New-York tribune., 1917-12-02

Mad been offered s3OO,000.000 for
his 5S1a per cent interest in tho
company.
New-York tribune., 1917-12-02
500, 900, 900 or
S250.000,O00

And as 8 result Of what they say
the tax which the corporation must
isy this year will be anywhere from
. little over slO0,O00,O00 to per-
laps $250,OOO,OOO. That is what
the law means.
Can the corporation or any hold
ing company, with widely dis
New-York tribune., 1917-12-02

must have?
Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1917-11-17
State House Chat

Secretary Of State Frank W. Ball
has moved his household goods from
Dover TO Augusta and is nicely settled
at No ID State street.
Word has been received from Is
land Falls that Representative II. T.
Sisson. pastor of the Within Congre-
gational church in that place. will next
week so to Springfield, Mass. to take
a four-weeks course in training in the
Y. NJ. G. A. work. preparato"., to going
in December to France VIII the Amer
lean Expeditionary forces.
DR.. a. G. Young of Augusta. who was
secretary Of the State Board of Health
before the recent reorganization If the
department n the creation Of the
position of public health commission
er. was in the city yesterday calling on
friends.-Portland Press.
The chorus rehearsals for the State
House Ministries are certainly 'soins
scme.' The Thursday evening attend
ance was about so people and last
night about the same. The songs and
ehcruses are already up to concert
Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1917-11-17
Woman's R~eformatory.

The Quarterly Bulletin Of thu Stat"
Board Of Charities and Corrections
speaks in part as follows Of the Re
formatory for Women at Skowhegan:
a crying need at this institution
just now is one which Other farms are
feeling. the need of outside help. The
farm is 9 good one, and IAN be made
to produce large quantities Of tie ne
cessary things with which to run the
place, but it needs to have The land en-
riched and worked to be nurtured and
cultured far beyond the present
amount Of work possible. Mr.. Wight,
the superintendent of the farm. has
two men with him, and they are doing
al that they can. And, standing on the
Neranda of the handsome new cottage,
looking Yer the fertile fields and to the
SHINING river, one could visualize the
place as it might be: first Of I'LL. one
would like the removal Of the present
farm buildings, barn, house and al.
which stand directly in front Of the
new cottage and make an ugly break
IN the picture.
Set at one end of the PROPERTY.
utilized for the necesoar,- farm, hell,
they would add instead of take from
the whole. And then, one could see
olher cottages Of smaller units that
might prove better for classification:
an administration building which
would centralize the diversified inter
ests, a central heating plant, which to-
gether with a central laundry would
perform its functions to the benefit If
the whole system. One could see wo-
manhood growing there as well as ma
terlai food for their bodies: could see
Ideals being built and ambitions start
ed into life; could see industry ana
sel-fespect and book KNOWLEDGE ana
the hlener wisdom of right living fos-
eefed and encouraged for those woman
OF our State who have never had ,boir
chance. "'
one could see in this Grind, t,,-
vital beginning of a great enterur;so Of
our 9tate 4 thing which shall orow ond
ueNelop INTO an institution that sban
* an TO Maine and 20 her nao-
PIE because it will stand between ~
tempted women of the State cnd tha;.
o"h olsnonor. Shall truly be 2 n,aco
oI re-makinG and rehabilitatinp wbirb
is reform" "hl'H
Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1917-11-17

pitch and will be the finest tnlnS
staged here for many moons.
Edward Connors, son of Mr.. n Mrs.
John Connors of Old Town, a civil en-
gineer and since resigning from serv-
ice with the Maine Public Utilities
Commission, connected with the j. w.
Sewall offices in Old Town, has re-
oeived his enlistment papers in the
engineering division the government is
forming to go to France at the earliest
possible date. Mr.. Connors was among
the drafted men and was in line to be
called with the final Is per cent. Of the
first draft, but the government has
waived the draft claim to accept him in
the engineering division. He left for
Camp DevenS. Aver, Mass. Thursday
morning, to enter upon his preliminary
training for his work abroad.-Old
Town letter, Commercial.
Rev. H. E.. Dunnack. State librarian
at Augusta. will speak in the Jones'
port opera house Friday evening, Nov.
23. under the auspices of the Parent
Teacher association. Mr.. Dunnack is
acknowledged to be an orator of ex-
.ceptional ability and the people Of
Jonesport should appreciate the OPP
portunity Of hearing him.-Jonesport
letter, Commercial.
Bangor dispatch Nov. Is in Boston
Globe-Major Arthur l.. Thayer, Judge
Advocate of 0 Milliken's staff. and
NJ. A. Barwise, a Bangor lawyer, are
making an examination of the books
of the American Express Company
here and tabulating shipments Of
liquor received in Bangor since July l..
Other than that they were working
upon orders from the office Of the at
torney general, Major Thayer had
nothing to say as to the object of the
examination.
Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1917-11-17
MADISON

CENTER-The Spiritualist Ladies', Ala
VIII meet for its annual meeting Nav y
az the nome of Miss Olive HAYDEN
A number of friends gathered =, tho
hoh1e OF Fred Hayden to tender him !
surprise party on the occasion of bic Ann
birthday. 80
Tracy Forsythe will leave soon 10 nass
the winter in Orlando. Fla. Mrs r p
Lombard will pass the winter nj the 81 M
place and Miss S. NJ. Ward. who has been
staying at her cottage, also plans TO go
70 Florida a little later.
Golden Glow Branch OF the Tnterna-
uonai sunshine Society has been doing
some good work with its hundred paving
members A fair is being planned for an
early date They have given the Red
Cross $40 in money and for the Relief AS
sociation have made 4s overdressing
socks, 20 washing gloves. 30 outing fan
rel shirts. II French pillow cases. -
Turkish towels, six crash towels. is am
bulance pillows. two hospital socks. one
muller and two pairs OF WOODEN stock
itgs. Names are being brought In At
about every meeting and pleasing pro
grams are being presented. The shut-ins
and aged members will be remembered a,
Christmas with fruit. flowers. handker-
chiefs. aprons, etc.
Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1917-11-17
Charities and Corrections

The following has been issued from
the office of the secretary of the State
Board Of Charities and Corrections
Skowhesan Town Farm.
Inc superintendent and matron are
Board OF Charities and Corrections
speaks as follows of the Skowhcgan
town farm:
Inc superintendent and matron are
Mr.. n Mrs. O. W. Bridges; SALARY.
Sous per year; experience, 6 wears.
recommendations and suggestions
Inc almshouse is one IF the higher
grade. The people in charge are con-
scientlous n neat, and the place has
peen papered and painted quite ey-
'enslvely within the past year. Cen
efai conditions are good. One latient.
WITH Venereal disease, is a hard case
TO manage, but is isolated aud wen
cared for.
If this place could have Hush closets
and a bath it would rank among tie
very best in the State. There seems
no special reason why this cannot he
zone at reasonable expense. and for
tire protection as well AS for sanitary
reasons ii seems desirable.
Conditions Observed-House il IF
'AiuId CilcInlrtlI IRE en-
1lnsulsher: heating by hot water.
lighting by lamps Inmates ouareers
k1tchen Cused also by superintendent;
!" dormltories and smoking DOM:
number of beds, Is; largest ,numhor in
n one room, /.
Inc almshcuse is not used as a house
or correction. Tramps are fed and
iodSed. Authority for their admission.
orders of oHerseers of ppp~.
cleanliness. excellent; repair. GOOD:
furniture. in good condition.. beds and
bedding. in good condition.: sanitation
good; care of food supplies, excellent.
facilities for the care Of sick or SEN
crate care Of infectious diseases s,lf-
ficient.
Assignment of work to inmates: able
to do Il little.
improvements since the previous in
spettlon; papering and painting cy-
tensively.
inmates present: adults. males under
oo' :; over 90, :. females under 60 l..
total b; epileptic: . venereal disco SO
cases.