The Washington herald., 1921-08-11
Transportation First.

& duced enough to permit a reduction OF over
Ssooooo 900 in taxation under the estimates
OF Secretary Mellon This certinly is good news.
Among the taxes to be estimated, or reduced, are
. those on ice cream, soda water and the like nul-
! sance" variety; on excess profits, and the higher
surtaxes on incomes There will be no increase in
letter postage and no bank check stamps, while the
$1,000 exemption on corporations will be retained
and the flat tax increased but I2H instead OF IS
per cent
4 - The reductions are to be retroactive for 1921.
sBut there is to be reduction in the tax on rail-
y oNb affc until 1t is then proposed to make
=, barizonta cut OF one half and wait until 1923 to
asrchcST transportation OF the other half. In our
Judgment the first tax that should be repealed is
hat on railroad traffic Theoretically it is the most
rscauable OF all as it is paid by everyone. 1t is!
theoretically, widespread charge. Actually, 1t IS
ssthe worst OF all
1t does not como from railroad income. nor
- 90 railroad revenues. 1t is very material in
screasc in all freight and passenger rates which
2~tan. now at the peak. The bulk OF freights are
1on so-caIcd commodities which consist almost
~ hOrY OF raw and semiraw materials which have
t'uuitc generally dropped in price to, near the
lsproyv1r level. 1t is known to everyone that the
siup.Lnlcntal requirement for resumption OF busi-
Anc hes in the revival of transportation. Yet the
5goseFHmcnt helps materially in stalng this revival
stSlhs tax which is a considerable increase in al
ready ovcrhigh freight rates.
r . S.Rairoads are the greatest employers OF labor
sartf the largest buyers of manufactured goods OF
great variety Their prosperity is the key to ma
t'tiohas prosperity. The government is decided
aet6 in halting this by the removal of even mere
IrIisancc taxes, while leaving this tax which helps
mo, ono and injuries all industry Its repeal would
o' FAR TO so increase traffic to enable the rail-
lroads } reduce commodity freight rates
s This tax goes into the price OF coal and has
.4hed back coal distribution 1t goes into the price
OF lumber and other materials and helps halt build
ing 1t comes out OF the farmers price for all his
~pro.luets and hampers agriculture 1t is added to
--rlc price OF ores and primary mineral forms. and
taxes industry. 1t is direct handicap to all in
saustries. and it is levied percentage on the
highest freight rates this country ever has known,
rates which are frequently onehalf the selling price
-.of the materials transported.
BY continuing it Congress will do what. more
,tlan anything else, will prevent business revival.
Railroads cannot reduce freight until freights
begin to move more freely. Cut off this and
that movement will start. Added a saving to the
low price OF all commodities, it will be induccmcnt
enough to start the ball 1t will bring direct cut
in prices and certainly that is the thing for
which everyone is waiting.
The Continental and Commercial Bank OF
Chicago has made survey OF business conditions
In summing up the prcpondcrencc OF opinion 1t
yivc- this conclusion: Transportation is the prob
lem OF greatest moment in the minds OF our con-
tributorS. The railroads efficient, but business
Is slack. Freight much too high in COM
parison with commodity prices and have hardly
shown signs OF yielding to the downward tendency
This condition. it is argued makes the price OF la
Dor in factories of small moment, but to railroad
n,cn wages are OF great importance