New-York tribune., 1920-04-28
A Piece-Scale Dollar

belleVlng CnaC Dy SndfinS Ill eN-
cess profits the government stimu-
La profteering, Congressman Grit
fin, Of New York, has prepared a
bill whereby all incomes, whether of
individuals or corporations, in eX-
cess of S100,000 are taxed 100 per
cent-in other words, confiscated.
Says Mr.. Griffin:
"Undcr the present law the prof
steers are permitted to retain so per
cent of their pilferings. SO long as
this is permitted profiteering is
worth while. Take away the in
centive by seizing their ill-gottep
gains, and proiitecring will cease to
be attractive. They will then direct
themselves to the task of producing
in larger volume and chcapening the
price of their product
Mr.. Griffin's measure would not
have the effect he describes; on the
contrary, it would push up prices
and diminish production. Ap-
preaching the dead line of extin-
gzlishment of further income, an III
dividual or company would buy mu-
nicipal, state and national bonds, ex-
crnpt from taxation.
Already the rich are absorbing
the country's $4,000, 100000 of tax
free securities-havc forced return
on them down to a and 4 41s per cent
whereas money for industry costs
7 to 8 per cent. Mr.. Griffin doubt
less has excellent intentions, but his
Information concerning the Incl
dence and the repercussions Of taxa
tion leaves much to be desired.
Yet it is possible to put brake or
pFofteering by taxation. Two
things might both be done. One is
to have graded tax on personal ex-
penditures. If the first $4,000 of a
mans outlay were exc'nrt and then
he were forced to pay according to g
rising scale on each additional 81 200
Of personal expenditure, he would
soon decrease wasteful consumption
and begin to save. Producers would
be able to borrow at better rates and
thus produce in larger volume. A
graded tax on expenditures is free
Of the grave objections urged against
sales taxes, and it's collection woulc
he less difficult than income tax col
lections, for the standard of man's
living is visible and an estimate car
easily be made.
But even more effective in stop
ping proftecring would be a graded
tax on the profit margin of sale.
rather than on capitals earnings, a.
now. The public should be pro
tected against the robber who double
or triples his invoice prices whel
goods reach his shelves. 1t is littl
or nothing to a buyer how much
concern makes on it's capital. w
should encourage quick sales an,
small profits and penalize slow sale
and high profits.
a concern which turns over it
capital ten times year, making
say, per cent net each time, Nigh
go free of taxation, even though
making 20 per cent on its invest
ment, whereas a concern whic]
makes only one turnover, with a |
per cent sales margin, should b
taxed, though earning less money o,
its capital. The delusion that tn
rate Of income on a given amoun
OF capital should be the taxatio
basis needs conquering. 1t cost
society billions. What is of momen
10 not what capital receives, but wha
it does.
The dollar should work on a niec
,. scale, and If one mans dollar doe
moro than another's it should 90
more. Astonishing is the failure G
legislators to master elementary ta
principles before venturing to enae
revenue laws.