The Bridgeport times and evening farmer., 1919-10-14


 eral subject of high prices and the causes thereof, natural or arr tificial, but shall confine myself to pointing out a few of the less patent and direct contributory factors. and to suggesting what I hope might be rem edial measures in respect of those particular fac tors.
 IT suggest the appointment by the Government of a non-po- 1itica1 body of experts to study the effects of the various kinds of taxation which have been in force during and since the ter imitation of the war, and to make recommendations to Congress based upon such study.
 It is q remarkable circun- stance that in the public discus sion of the factors which are re- sponsible for the prevalence of excessively high prices. the sub ject of taxation has hardly been mentioned.
 Yet, it is, I believe, Q demon strable fact that the unscientific system of taxation adopted in this counthy since 1917 has play ed a considerable part in boos&- ing prices.
 Nothing is further from my thought than to object to the oo-' vious purpose underlying our war taxation, namely, to impose the greatest burden upon those best able to bear it
 I do not wish to dispute for a moment that taxation must be laid in accordance with the dic- tates of social justice.
 To advocate a scheme of taxa tion which would spare wealth, would be both wrong and fatu- ous.
 Yet cannot escape the concIu- sion that the very extreme of the burden laid upon business and income has partially defeated the purpose which the franers of our taxation legislation apparently had in view, and at the same time has given rise to certain unforeseen and troublous devel- opments-as invariably happens in the case of extreme measures, especially where economics are involved.
 Now that the emergency of the war is over, I believe that the entire matter should be subject ed to unprejudiced and compe- tent critical review.
 The Excess Profits Tax
 There can be no question that, owing to the increased cost of liv- ing or the decreased purchasing power of the dollar, the farmer, the wage worker, the man and woman living on salaries, are en- titled to a proportionate increase in income.
 But the enhanced cost of living and the diminished purchasing power of the dollar affect the owner of indusetrialIy invested capital no less than they do oth- CT callings.
 And in addition thereto he is subject to a heavy excess profits tax and, if his income is large, to an income tax of unparalleled severity.
 However, we may leave out of account, for the purposes of my argument the relatively small number of those in possession of large incomes.
 When l speak of the owners of industrial1v invested capital, I
 
 the average merchant and the millions of men and women who derive all or part of their income from investment in securities of corporations.
 By the same token as the far rner. the wage worker and the saIaried man, they feel the need of a larger return than former ly.
 But there they run up. first of i all, against the express profits tax in respect of their own business ! or the corporation in which they have invested.
 i Let me point out, incidentally, l that the spectacular earnings of l certain corporations and individ- uals afford no just criterion of the earnings of business on the whole.
 As against number of con- ! cerns and individuals who have 1 made exceedingly great profits
 during and since the war, there are numerous others whose earn i ings have shrunk during and l since the war.
 It may be interesting to quote i in this connection the results of an investigation made recently in England (where conditions ap- | pear to be very similar to those 1 prevailing here) as to how the in 1 creased cost of certain articles in the past two years compared with the two years preceding the war, had been divided. The investigator found, taking such increase as 100 per cent, that labor received 57 per cent. more than before the war, the | state through taxation 40 per cent more and capital per cent more.
 This Is not the place to argue
 the question whether in the pre- war era. industrially invested capital received too large a. part
 of the national income. In some respects, I believe it 1 did. But the fact is that since
 1914 the wages of labor have been vastly increased. The farmer also rightly re- ceives a much greater return than formerly, and it must be remembered that both the wage worker and the farmer are little
 burdened by direct taxation. The return on industrially in vested capital, on the other hand,
 after making allowance for taxa
 tion, has no doubt been dinin-
 ished on the whole, and in many
 cases very greatly diminished. If, in addition, it is considered
 that the purchasing power of the
 dollar has been reduced by
 nearly one-half, if will be seen
 Ha ia16 0f ioI