American Falls press. [volume] (American Falls, Idaho) 1907-1937, 1918-04-12
No Extortion to Be Tolerated, but
Liberal Disposition Toward
Business Needed.
Shrinkage Of Values Would Cur
tail Capacity to Provide
SineWS of War.
"conscriptIon Of Men, CONSUMPTION Of
Money" Analysed.
BY OTTO II. KAHN.

siDle contention lhdl DC
a certain portion Of the young
manhood of the nation has been con-
scripted, therefore money must also be
conscripted. Why, that is the very
thing the government has been doing.
1t has conscripted a portion-a rela-
lively small portion-of the men of the
nation. 1t has conscrlpted a portion
a large portion Of the incomes of the
nation. Capital and business pay more
than f~our-hfths of our total war taxa.
ton directly and a large share of the
remaining fifth indirectly.
II the government went too far In
conscripting men the country would be
crippled. If it went too far in con-
scripting incomes and earnings the
country would likewise be crippled.
Results Of CONSUMPTION Of Capital.
| would ask those who would go
further and conscrlpt not only incomes,
but capital, to answer the riddle, not
only in what equitable and practicable
manner they would do 1t, but what the
nation would gain by 1t?
1t is true that a few years ago a
capital levy was made in Germany, but
the percentage of that levy was so
small as to actually amount to no more
than an additional income tax and that
at a time when the regular income tax
in Germany was very moderate as
measured by the present standards Of
income taxation.
Only a trifing fraction Of a mans
property is held in cash. If they con-
script a certain percentage Of his pos.
sessions in stocks and bonds, what
would the government do with them1
Keep them2 That would not answer
its purpose. because the government
wants cash, not securities.
Sell them7 Who is to buy them when
every ones funds would be depleted?
II they conscript a certain percent
age of a mans real estate or mine or
farm or factory, how is that to be ex
pressed and converted into cash7
Are conscripted assets to be used al
a basis for the issue of Federal Re
serve bank notes? That would NEAR
gross imitation, with all its attendan.
evils, dangers and receptions.
Would they r%epudiate a percentage
of the national debt? Reputation Il
no less dishonorable in a people thar
in an individual, and the penalty 70
failure to respect the sanctity Of obi
cations Is no different.
The Thrifty Would Be Penallzed.
The fact is that the government
would gain nothing In the process o
capital CONSUMPTION and the countr
would be thrown into chaos for thu
, time being. The man who has save
would be penalized, he who has waste
would be favored. Thrift and construc
tive effort, resulting in the needful an
fructifying accumulation of capita
l would be arrested and lastingly di:
couraged.
D l can understand the crude notion q
J. the man who would divide all posses
4 slons equally. There would be might
little coming to any one by such distr
button. and 1t is. of course, al utterl
y impossible thing to do. but it is an III
derstandable notion. But by the col
n fscation of capital for government us
: neither the government nor any ind
!, vidual would be benefited.
A vigorously progressive income ia
Q is both economically and social
u sound. A capital tax is wholly unsoun
and economically destructive.
1t may nevertheless become nece
sary in the case of some of the bellige
ent countries to resort to this exped
ent, hut I can conceive of no situatio
NJ likely to arise which would make
necessary or advisable in this countr
o More than ever would such a tax |
c harmful in times OF war and pOst-be
lum reconstruction. when beyond a
most all other things It is essential
q stimulate production and promot
thrift, and when everything which ten,
to have the opposite effect should
= vigorously rejected as detrimental
the nations strength and w~ell-being.
There is an astonishing lot OF hal
thinking on the subject of the uses