The Birmingham age-herald., 1917-05-15
Must Be So Arranged as to Stimulate and Not to
 Retard Business
HESITANCY IS DUE
 TO UNCERTAINTY
Englishmen Have Recently Given Some Good Advice Regarding Method of Handling Financial
 Subject During the War
By HOLLAND

New York, May 14-(Special)-Tw bil- lion dollars will have been borrowed by the government from the American peo- pie before the end of the present fiscal year. One billion eight hundred millions will be taken from the American peo- pie by taxation before the end of the next fiscal year. Therefore, approxi- mately s4,oo0,0oo, 900 will be and must be, fin fact, secured at home by the gov ernment within the next 12 months.
 For the past week or 10 days some of those who will be of great assistance to the government in marketing the loan of g, coo, ,O0O,O 600 and in certain other activities. have been in Washington and have been able to learn. face to face with the authorities there some things which 1t was not possible to learn in New York city. For instance, they have been able to learn that while Congress is fully disposed to adopt any revenue measures whereby the needed funds can be ob- tained within the next F months, nearly s2,0o0, ,000,000, nevertheless there does not seem, it is feared to be at present, a clear understanding on the part of Congress of the true relation of taxation to the floating of immense loans.
 For some days reports have been cur
 
 government there may have been some disappointment because the loan of 3D. O0O,OO0,000 has not been immediately or more enthusiastically subscribed to by the American people. Yet no one doubts the success of the government in placing the loan by mid-June. The disappoint- ment does not refer to the expectation that the loan would be successfully float cd. but 1t is based upon the apprehen- sion that there may not be so much a question of the loan now in progress of perfecting, as it is a question of future loans; for the United States will at some- time probably within a year, come for ward with another offering of bonds, and the government is authorized to offer as much as s7.000,0 GOO.
 The revenue measure, which now ap- pears in the form of a bill before the lower house of Congress, does not, it Is feared, reflect accurate and adequate ad- Justment of taxation to the marketing of great loans by the United States. Some of those who were recently in Washing ton had reason to infer that the adminis- tration received excellent information re- 6pecting the manner in which Great Britain has adjusted her taxation system to her borrowing capacity. It was said by one of the leading men of finance, who has recently been in Washington, that England really leaned backwards in her attitude toward business in Great Britain. Her government and her states men realize that, if England were to bor- row heavily, she must also tax heavily She must, however so tax her citizens as not to impair their business activities, but in fact to stimulate them For it is largely upon present and future busi- ness that Great Britain must rely for her money supplies. That is one of the reasons why England so gradually in- creased the income tax. Her government realized that the citizens of Great Britain who receive large incomes, spent in per sonal ways only comparatively small part of these incomes. All of the rest went back into business. Much of it was invested in new business or the enlarge mept of existing industries.
 If. therefore, Great Britain took by taxation one-half of the great incomes she would In that way prevent the men of capital from investing in new enter prises, or in reinvesting in such man. ner as to speed up the business life of Great Britain. And it was this req