Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1918-09-15
THE DOLLARS OF THE
PRIVILEGED CLASSES
Congress Is Exempting Them From Taxation
and Putting the Heavy Burdens
on the Rich

on the Rich
THERE can be no disagreement on the
proposition that the financial policy
of the Government at this time should
not be dictated by political towards.
Certain provisions Of the war revenue
bill, however, indicate that the towards
are in the saddle. The Secretary Of tho
Treasury has asked them to make some
concessions to an intelligent financial
policy in order to facilitate the floating
of the new Liberty Loan, and the House
has done it.
But Mr.. McAdoo was not so cour-
ageous as he should have been.
His request that the income from $780,
900 Of the new loan in the hands of one
holder be exempt from surtaXes has
been embodied in bill. Exemption
from SurtaXes on the income is also
granted on $4,000 each of the second
and third Liberty Loans in the hands of
single holder. He does not seem to be
brave enough to demand that a taX-free
bond be issued.
Representative Cannon was not so
timid. He urged IA 3 per cent taX-free
bond and the refunding of the second
and third loans by issues of this charac
ter. Mr.. Cannon has mind that thinks
clearly and he is not afraid of the logic
of his conclusions He knows that
taX-free bond can be sold at a lower
rate of interest than taxed bond. He
knows that the money received in taxes
on bond bearing higher rate of inter-
est will be only enough to pay the extra
interest and that there will be no net
return to the Government. Every man
who has any money to invest, even If It
be only $1,000, knows it also
Bondhoders, however, have no friends.
They have been condemned by the politi-
clans from the beginning. But when Mr.
Cannon and those who agree with him
urge a taX-free bond they are speaking,
not in behalf of the rich-they can take
care of mselves-but in behalf of the
common man on whom the burden of all
taxation ultimately rests.
1t is of the first importance that the
great war loans should be made attrac-
tive to capital-not capital as represented
by 100000 Or $4,000. but capital as rep
resented by S3OO0OO0 or $4,000, 900. in
the hands of private individuals and in
the hands of trustees for great masses
of people, such as insurance companies
mutual savings banks and college corpo-
rations. The trustees are compelled by
loyalty to their trust to secure the best
income possible on their funds. If
per cent corporation bond will net them a
better income than a 4 per cent taxed
Government bond they must pass the
Government by. And they will do it. in
order that they may conserve the prop
erty in their care. They cannot be COM
PEELED to do otherwise, unless the Govern
ment intends to make forced loan.
We use many fine words about democ-
racy, but the House of Representatives
has definitely refused to recognize the
democracy of the dollar. 1t has created
a privileged class of dollars in the belief
that it is thereby representing the sent-
ment of the country. Unfortunately, it
has justification for that belief. The
theory is widely held that the ends of
social justice are served by levying a
heavier income tax on the rich man than
on the man of moderate means and by
taking over large part of the estates
of rich decedents. A man has written a
book recently to prove that the heirs of
the rich have no right to inherit the
property of their parents and that it
should all go into the public treasury. We
do not intend to combat either of these
views, but we desire to call attention to
the simple and elementary fact that the
policy of levying a Federal tax on a
Federal bond defeats in the long run it's
avowed purpose of increasing the Fed
eral revenue. Such notifications of the
bond taxing provisions of the revenue
law as are now in the making are wise,
but they do not go far enough.