New Britain herald., 1918-06-08

tion will extend into retail distribu- tion cannot be foretold.
 More attention is now being paid to railroad shares as the importance of backing becomes more generally rec ognized. Their profits on the basis of the past three years are assured for a considerable period; rates are to be liberally advanced in order to meet increased wages and other expenses; the government will provide funds for necessary improvements and reha btli- , tatiOn; labor troubles under govern ment control will be at minimum, while simpler operation, reduction of expenses and cessation of state inter ference will add to the general relief of American railroads. Our indus trials are a somewhat more complex
 situation, as illustrated by reduction
 in several copper dividends. The out-
 look for necessary industries is still encouraging, especially steel produc-
 tion, which for obvious reasons is lib
 orally treated by the government. Thus far the the diversion from the unne
 cessary to the necessary has caused relatively little hardship because of the urgency of the demand for essen tials. Some industrtals will feel the coming increase in taxes, which, it is already intimated, will be double the present rate. As these burdens will be based chiefly upon excess profits and large incomes, the government will be obliged to act discreetly in formulating any new taxes, lest 1t de- stroy the profits and the enterprises out of which these taxes must be ex- tra cted. The administration is cer- tainly likely to be wise enough to avoid of 9 of easily secured revenue.
 This whole question of taxation is one that requires expert knowledge, also a strong sense of justlce; else self-injury and inadequate revenue will result No doubt Secretary Mo Adoos suggestion that one-thlrd of the necessary revenue be raised by taxation and two-thirds by bonds will receive general approval. It is esti- mated that the war will cost next year nearly 20 billions, and that to raise more than two-thirds of this by bonds would mean hurtful imitation, and in creased interest rates. Apparently there is no better plan than increas- ing taxes, simplifying them, and dis tributing them as equitably as possible. The burden is an unWelcome one, but we are quite equal to it, and the call will be cheerfuHy met
 The recent strength of the stock market reflects general soundnesS Of the financial situation, as well as uni versal confidence in the future; the latter being largely inspired by un- shaken belief in ultimate victory. Prices fuctuated sharply at times, owing to protit-talIing and conflicting reports from the front, but the pre- vailing trend seems to be optimistic. The break in coppers also checked the advancing tendency. A notable change for the better was the increasing SUD- ply of time money and slightly easier rates. presumably due to the war loan being out of the way and to taxes be- ing practically provided for. Until Drepara tions for the next loan are Tn order. the money market should have fairly plain sailing. At no time since our entrance into the war has the out look been more reassuring Or less con- fusing. The process of mobillzlng the economic machinery of the country on a war basis and placing it under gov ernment direction has been almost comDleted; while business is becOpi- ing more and more accustomed to the new conditions and is running With increasing smoothness under the new regime. -HtNR KY NLENo.