The Washington herald., 1917-06-05
Economy in Shngshots or How to
XIII Prosperity, Taxation and
Bond issues with One Stone.

should more quickly respond to the
popular will than either the. Senate
or the executive branch Of the gov
ernment. In the example of the
revenue bill It has possibly assumed
that the advertisements and speeches
Of Mr.. Amos Pinchot and his a.
ISOLATED enemies of the wealthy were
in a measure expressive of the na-
don's desires, whereas they als
merely the Three Tailors of Tooley
Street. Not from the President, We
think, but from this combination of
inherited wealth and Iecture-room
knowledge has come the demand that
the expenses Of this war shall be
paid "as We 60" Without induISinE
in the slightest criticism of the House,
for whose lofty purposes The Herald
has the highest respect. let US inquire
a moment into the direction the
theory Of making wealth pay for tho
war "as we go" would lead us.
The Herald has no objection to Mr..
Pinchot, Mr.. Odgen Reid and the
others who are engaged in batting
their fellows turning over the entire
amount Of their private fortunes to
Secretary McAdoo for war purposes.
So far as The Herald knows these
gentlemen are conducting no great
enterprises on which the country must
rely for supplying the millions of men
in the field. II is a mistaken idea to
assume that all the large incomes in
this country are expended in costly
and eGtravagant living. The incomes
come from forges. factories, mines,
railroads and in large part go back
into them agin for development.
These are all going concerns ana,
with the farms, it is important that
they should continue to produce con-
tinuously and amply all these things
which will be used by this and the
allied countries until the end of the
war.
Now. II the excessive taxation,
largely imposed because there is a
mistaken impression that wealth Is
not bearing its share is imposed, to
the extent OF causing Industries to
slow down their activities, the result
Is bound to be bad in all directions.
In the first place 1t will cause ap-
prehension among the manufacturers.
1t will affect the volume Of produc-
tion. That, in turn, will affect the
ability Of the plant to produce. That,
In turn. will AFFECT the ability of the
owners OF the plant and their en-
ployes to support the bond issues of
the Treasury Department. There are
i54 automobile factories in this coun-
try. employing 1890 persons Figures
OF 1910, and the salaries and wages
paid amounted to S1lS,OOOOOO This in
dustry has already been harassed and
threatened by various proposals to i'm
pose taxes in the factories of five per
cent 1t has been stated again and
again that If this tax be imposed
many OF these works will be shut
down. Then from that quarter no
more taxes and no more bond suo-
scriptions. 1t is the duty Of Congress
and Of the government to see that
not a factory closes. But already a
feeling of dread has been engendered.
1t could easily be removed so far as
this industry is concerned II the policy
were adopted of making the tax on
automobiles a luxury tax. Any man
who can afford a pleasure car can
AFFORD to pay a tax upon it for the
support OF the war and afford to do
it every year.
Common sense is needed. It is above
all things important to preserve and
observe a proper relationship between
taxation and bond issues.
In the civil war taxation did not be-
come heavy until three years hao
passed. but with fostering care
ard a protective tariff even then
some of the industries withered and
perished," says Prof. Bolles in his
Financial History of the Tn.tcu
States, from the effects Of internal
revenue taxation"