The Washington times., 1920-08-16
Some Standard Oil Smiles
The "Recan" Might Improve the Thinking of the
United States Supreme Court.

Somewhere in this land there smiles in spite Of
high prices and foreign worries You may one Of those
smiles the face of any friend that happens to own stock
in the Standard Oil Company Of New York
The capital has been increased from seventyhv mil
lions to two hundred and twenty five millions increase
of one hundred and fifty millions Everybody with one
share will have two shares given to him for nothing
And they extremely nice, fat, profitable shares
But that is only part of it. The real beauty of the
thing that the happy Shareholders to whom hundred
and fifty million dollars in extra stock given will not|
pay one dollar of income tax that stock distribution
The Supreme Court Of the United States has decided
that when little gets two hundred dollars month Tor
working hard that is income and must be taxed by the
Government But when group of men get in lump one
hundred fifty millions in Standard Oil stock that isl
worth great deal than hundred and fifty millions
in cash. that NOT income and cannot be taxed Naturally
the Standard Oil gives to its immensely rich stockholders
not taxable cash, but tanfree stock dividend
You understand of course just how the convenient
Supreme Court decision declaring that stock dividends
not income works to the advantage of rich men,
Suppose owning hundred millions OF dollars
includes in his possessions Standard Oil stock Out oil
every dollar that the Standard Oil Company gives to him
in CASH dividends he must give at least sixty cents to
Government in income Therefore dollar of Cash in
from the Standard Oil would to him forty cents
less for himself. But it, INSTEAD of cash dividends,
he get stock dividends he keeps ALL the Government
gets nothing and the little people must be taxed
make up the difference.
You how easily the thing be managed Instead
Of paying its stockholders cash dividends the company
invests its profits in notes. Government bonds
additional wells and factories other valuable securities
It issues additional stock which s according to ad
mirable Supreme Court, NOT income The stock u.s. how
ever receipt showing ownership in the bonds other
securities purchased with the cash earnings 1t is income
Supreme Court Supreme Court For no court can
change fact.
The very rich holds his extra stock which he|
has paid the Government nothing BY and BY when get
of times and taxes and the income tax drops
he will get his money and keep it instead of giving to
the Government In other words the company invests his
money for him, and he pays tax.
You understand that owning Standard Oil or other
stocks in blocks do actually need the dv
dends in cash to live They would rather wait and let
the thing pile up OUT OF THE GOVERNMENTS
REACH.
1t is as though the average little man on salary
didn't need the money He would be glad to have the
Supreme Court decide that his employer instead of giving
him cash NOW might give him today stock some
other piece of paper and hand the cash after
the income tax goes down.
There never decision unjust to the ordinary
people, contrary to public honesty than that decision
of the Supreme Court
There decision that emphasizes more clearly
the fact that the people should have among other
the right to recall their officials, including and EsPE
CIALLY the most important, who the judges of the
Supreme Court Of the United States
The thing is made all the dangerous by the fact
that those of the judges that decided in favor of the
full arrangement undoubtedly honest men, and actually
believed it right to allow the very rich take
his income in stock dividends paying nothing the Gov
ernment, while the little takes his salary business
profit in cash and must pay taxes
To have corrupt judges giving decision bought and