The Washington herald., 1917-05-24
We Need Teamwork.

and confusion, certain branches Of
our government should fail to CO.
ordinate. We are witnessing today,
however, in Washington an instance
of this lack of coordination that may
be little less than disastrous.
On one hand the Treasury Depart
ment is making strenuous efforts to
make a striking success of the
new liberty loan Of $2,00O,O0O,OOO.
Everyone does, or ought to, appre-
eiate the necessity of making the sue
leess OF this FIRST financial operation of
the war overwhelming; the necessity
OF showing Germany that we are
whole-heartedly in the conflict; the
necessity for proving to ourselves that
we are ready to go forward patrioti-
cally and generously in the first way
that is offered to accomplish some
thing real in the war. Committees
ot prominent bankers have been or
gained In New York and are being
rapidly organized in other parts of
the country to the same end. Secre-
tary McAdoo himself is touring the
West. urging the cooperation of
banks and investors.
But meanwhile. Congress is sitting
and. with lack of appreciation of
the situation which we must confess
is astonishing, is doing all in its
power to negative the efforts of the
Treasury Department; is doing every
thing it can to wet-blanket the loan.
We say Congress. when we really
mean the House of Representatives
and the Ways and Means Committee,
for as yet the Senate has not spoken
In the matter of the taxes. We hope
feUently that when the war revenue
measure finally reaches the Upper
House we shall see some sign that the
elder statesmen appreciate the gravity
of the situation.
The House has framed a measure
OF taxation that. as we put it in an
editorial a fortnight or so ago, is
nicely calculated to kill completely
the goose that lays the golden egg.
In the first place, in our humble judg-
ment, the Ways and Means Commit
tee has attempted to secure from tax
ahon far too great a proportion this
FIRST year of the expenditures of the
war. There seems to be a feeling
that the thing to do is to soak" the
nch, to bear down hard on prosperity,
and to attempt to pay by taxation in
two years for a war that is designed
to benefit our country for generations
to come. The fact that England has
found it impossible and unwise to at
tempt such heavy. proportion of tax
alton affects our Legislators not a whit.
What care they for previous exper-
ience and for the wisdom of others
gained by that bitter experiencep
Apparently the only way that they
can learn Is to endure themselves the
bitter experience of grabbing this first
year. by means of taxation. all money
in sight, trusting to luck to find in
another year a renewal of the sources
of supply.
We are well advised when we say
that this theory of taxation is graveIy
imperiling the entire success of the
loan. 1t is alright to figure that
small investors throughout the coun-
try, who won't have to pay very much
in the way of tax, are the ones to
subscribe to the loan. This is per-
fectly true, but the aggregate of their
subscriptions. loyal and generous as
they may be, will certainly not exceed
$200.0O0,0O0 or $300,OO0,00O. The
other $I.700.000.000 or $I.600.000.-
600 is to come from the well-to-do
and from the rich, both individuals
and corporations. But the House is
I deliberately taking by taxation all the
reserve funds of this class of inves-
tors and making it difficult and, as
many of them point out. impossible
for them to subscribe to the loan.
In our judgment, it is of infinitely
greater Importance that there should
be generous over-subscription to this
loan than it is that we should raise
this year few hundred million dol
lars more or less by taxation. For if
once our loan policy is established, if
our initial operation is success. then
we can continue to float loans at a
fair rate of interest to cover whatever
the expenditures require. There has
never been before in this world an
attempt to finance a war by methods
of taxation so heavy as to attempt
to cover the total war expenditure
within a period of two or three. or
even FIVE years. Such theory is i'm
possible to work out in practice. 1t
cap he done only AZ the evoense of