Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1921-07-31
THE VITAL QUESTIONS.

The federal tax question is likely to take prece-
dence over the tariff in congressional discussion and
action 1t should The former is far more vital to the
restoration of normal business conditions than is the
latter.
In the period of rising prices every industry made
money. There no hazard, Business men disiked
to pay the government large slice of the money
they made but they did in order to have the
balance.
But in period of receding prices when men can
not tell with certainty that their operations will be
profitable, they will not accept the double handicap
of danger of loss on the hand and excessive gov
ernmental appropriation on the other hand Heads
win, tails you LOSE does not make much of an
appeal to the gambling instinct.
This question of tax revision has but one running
mate in economic Importance in our judgment. 1t is
the question of foreign credits. A safe way surely
can be found to help Europe buy from America. the
goods which she needs and which need to sell.
True Europe is poor and must forego luxuries.
To help her buy them would be folly. Poor people
can better their condition only through economy and
thrft-plus industry. Europe is showing an economy
and thrift of which Americans know little But she
cannot show industry among her industrial classes
unless she secure the raw materials with which
to run her factories.
For instance, need to sell more copper. Europe
needs to buy more. Why cannot government ar
range with foreign governments to advance them
copper on credit? The foreign government can then
advance credit its manufacturers waiting for pay
ment until the finished product is completed and
marketed This may be difficult to arrange but it
tainy is not impossible. The attendant difficulties is
no reason for not proceeding with the matter.
AS for internal taxes they are bothersome at best
The nuisance" taxes, such the tax at soda foun
tains should be repealed. Their honest enforcement
is impossible anyway,
The journal favors a combination of an ultimate
sales tax with a reasonable modified excess profits
tax
Mr.. A. B. Mcmillan made the statement the 9TH
er day. before the Rotary club, that the consumer
paid all the taxes, in the last analysis. Time was
when believed that to be true. But it is not true.
Let illustrate.
A certain number of producers of wheat can
produce their crop, will say, at fifty cents q
bushel This is due to favorable soil, favorable eli
mate, the growing boys of the family who can work.
and to a variety of other Let say that these
can produce 25 per cent of Americas requirements.
Another class, somewhat less favorably situated,
produce another rs per cent of the requirements
at seventy-five cents bushel.
Yet another class. still unfavorabe stu
ated can produce another rs per requirements
at dollar per bushel The last rs per cent of
qurements is produced at cost of one dollar and
twenty-five cents per bushel.
Now the price of wheat will be somewhat more
than dollar and twenty-five cents bushel as
to give the last necessary producer chance to live
II wheat falls to dollar the most ill-favored pro-
Queer must quit producing and a shortage in the
supply will force the price up again until enough
wheat can be produced.
Let us say that this condition fixes price of one
dollar and thirty cents a bushe The least capable
producer then makes five cents bushel The most
capable makes eighty cents per bushel.
Without profits tax this favored pro-
Queer escapes with this abnormal profit. If he is
taxed with progressive profits tax, he has
not way to pass the tax the consumer. the
price of wheat will be dollar and thirty
all the wheat produced whether he pays tax not
Allowing him to escape will result in of the
wheat selling at fifty-fve cents while another part
sells at dollar and thirty cents
Mr.. McMillans statement could be predicated
only the theory that it costs all producers the
amount to produce their product In that event any
tax levied would be part of the cost of production
and be passed on to the consumer.
SO we believe excess profit tax not so severe
to destroy initiative, should be retained.
A small ultimate sales tax would raise i'm
mense revenue without appreciate burden to the
people. 1t would force those whose income is not
large enough to require the payment of an income
tax to make contribution to the support of the
government 1t would require all of pay to the
to spend each year.
These two questions must be faced and solved
before normal conditions are restored.
HERO STILL.