Daily capital journal. (Salem, Oregon) 1903-1919, 1918-04-22
No Extortion to Be Tolerated, but
Liberal Disposition Toward
Business Needed.
Shrinkage of Values Would Cur
tail Capacity to Provide
SineWS of War.
Transcription of Men, conscription Of
Money" Analysed.
: BY OTTO H. KAHN.

6lDle sounding contention Lnat De
cause 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 mor'
than four-fifths of our total wal taxa
ton directly and a large share Of the
remaining fifth indirectly.
If the government went too far in
conscripting men the country would be
crippled. If 1t went too far in con
scripting incomes and earnings the
country would likewise be crippled.
Results of CONSUMPTION Of Capital.
l would ask those who would GO
further and conscript not only incomes
but capital, to answer the riddle, not
only in what equitable and practicable
name 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 "a very moderate as
measured by the present standards of
income taxation.
Only a trifling 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 them7
Keep them? That would not answer
its purpose, because the government
wants cash, not securities.
Sell them? Who is to buy them when
every ones funds would be depleted?
If 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 as
a basis for the issue of Federal Re
serve bank notes? That would mean
gross imitation, with all its attendant
evils, dangers and receptions.
Would they repudIate a percentage
of the national debt? Reputation is
less dishonorable in a people than
in an individual, and the penalty for
failure to respect the sanctity of Obli-
cations is no different.
The Thrifty Would Be PenaIlzed.
The fact is that the government
would gain nothing In the process Of
CONSUMPTION and the country
would be thrown into chaos for the
time being. The man who has saved
would be penalized, he who has wasted
would be favored. Thrift and construc-
tive effort, resulting in the needful and
fructifying accumulation Of capital,
would be arrested and lastingly dis
couraged.
/ can understand the crude notion of
he man who would divide all posses
equally. There would be mighty
little coming to any n by such distri-
and it is, of course, an utterly
impossible thing to do, but 1t is an I'M
lerstandable notion. But by the con.
.iscation of capital for government use
neither the government nor any lndl-
7idual would be benefited.
A vigorously progressive income tax
S both economically and socially
sound. A capital tax is wholly I'm
sound and economically destructive.
1t may nevertheless become neces-
in the case of some of the belliger-
mt countries to resort to this expedl-
mt, but l can conceive of no situation
likely to arise which would make 1t
necessary or advisable in this country.
i, More than ever would such a tax be
harmful in times of war and post-bel-
UNI reconstruction, when beyond almost
Ill other things it is essential to stimu-
ate production and promote thrift, and
when everything which tends to have
be opposite effect should be vigorously
as detrimental to the nations
strength and well-being.
There is an astonishing lot of hazy
thinking On the subject Of the uses Of,
In the hands Of it's owners.