Evening star., 1918-07-02
ADVERTISING HELD
BUSINESS FACTOR
Roger w. iBabson, Statistical
Expert, Discusses Features
of New Revenue Plan.
VIEW OF TAXING CAPITAL

The value Of advertising in building
UP business was empha sized py Roger
W. Babson, the statistical expert no"
working for the Department OF LABOR
who has made several trips to sou'h
America for Secretary McAdoo, III ees-
tifying yesterday before the ways ana
means committee.
Recognition of the Importance OF
good wilr' In business as derived
through advertising. even more than
through other agencies. should be al
lowed for in taxing capital, accorolhe
to Mr.. Babson's statement regarding
the new war revenue law
That employment of money for hir-
ing workmen to beautify property
In order to make it more attractive TO
trade is permitted to be classed as in
vested capital, whereas money spent
for advertising. which does infinitely
cannot be SO classified. Mr.. Babson
pointed out. He urged that good VIII
gained through advertising should be
allowed classification as invested cap
ttal and exempt from taxation.
Gives Results of Observation.
Calling attention to three trips that
he had made to South America az tne
request of Secretary McAdoo 70 STUDY
marks and brands in the development
of commerce. Mr.. Babson stated 1hat
from his personal observation Ger
many built up its extensive trade IN
the South American countries prin-
cipally through advertising.
"Tf hire a CArDenteT TO erect a
sign" said Mr. Babson. illustrating his
ideas, land a painter to advertise my
business thereon, 1 can charge the
service Of this carpenter and painter
vest the same amount of money In
paper and ink, the government re
fuses to consider 1t capital invested.
This is absolutely unjust ana ois-
services of advertising men are just
as valuable to this country as the
services of any mechanic. In many
ways the services of the advertising
expert are more valuable because the
demand for goods must come DeIofe
goods are manufactured.
Trade marks and brands are as
important in developing domestic IN
dustry and in standardizing manufac-
turing as are buildings and ma
chinery," continued MIR. Babson. To
refuse to consider money spent upon
advertising as capital invested and TO
allow 1t in the second instance is DIS
einctly handicapping American indus
Try Such discrimination not only al
fects the manufacturer and business
man. but the wage Garner as Well
Advertising has done more than any
one other thing to create work Tor
and help the interests of the wage
earners of the United States.
Value Rated High.
In the development of foreign trade
the value Of brands and trade marks
is tremendous The success of Ger
man. English and French exporters
has been largely due TO the encourage
ment of the development of brands
by the representative government. II the
United States government recognizes the
yaiue OF trade marks to the extent OF
projecting them by legisiasi on, tt ceE-
tainly should recognize their value IN
connection with taxation. The nation
which has the greatest foreign trade
after the war will be the one whose
manufacturers have the greatest good
will Certainly Congress should do
everything to encourage manutactur,
ers in the development OF this good
will"