davidaulloa/AmericanStories huggingface dataset:
New-York tribune., 1922-02-12

The only exception to this rule vas
in case a debtor had been adjudged
bankrupt and the report of the re
ceiver showed that the amount which
would be recoverable was less than
the amount due In this case the tax
payer was permitted TO deduct par
tial write-off Of the debt. The rule Of
the department requiring determina
ton of a bad debt b. fully compl"tef
and closed transaction was clearly IN
sound. The taxpayer was naturally
anxious TO report his loss in the year
in which It WAS sustained ard IN order
to do so he Was compelled to close out
an account for tax purposes.
Ihc new law changes the previous
practice in two particulars: First. BY
recognizing 4 reserve for bad debts.
and, second. by allowing debt to De
charged of in part. Under this nro9i-
sion a taxpayer may treat bad deots
in either Of two ways ,1} By de
duction fro mincome in respect Of
debts ascertained to be worthless in
whoc or in part. on - by deduct on
from income Of All addition 10 re-
serve for bad debts For the yrar 8Zi
taxpayers. regardless Of their previous
practice, could eject either Of tho two
mathods The method adopted, now
ever. must be followed IN the futuf"
unless permission 10 change - granted
by the Commissioner Of ln'erna
perapt,c
New-York tribune., 1922-02-12

doesn't the government print lot
Of paper money all the time and pay
their bills in that way"
'Ncs, of course came the reply.
"Thcy have to-
"Wcll.' said seeing that must
ask the direct question. "don't you
think that such n constant increase Of
the paper money in circulation must
cause prices to rise ?'
The reply was, 81 don't think so,
why should it?"
So much for the general ignorance
on imitation. as depreciating the mark.
AS to the second point. the effect Of
this depreciation on the poor. the
ignorance seems to be just as profound
and general.
lrredeemable paper money has often
been nicknamed "forced loan The
description is not a very good one. for
usually. such 'loan" is not repaid.
Certainly, in the case of Germany. in
hation is better classed as forced
tax, or better (since every tax IL
forced in sense) taX forced indi-
rectiy and usually unhe known TO the
Ia
New-York tribune., 1922-02-12
Small Classes Of Rich
Nalionalists Will Dodge
Their Taxes; Reasons for
Keeping Up the Policy
Big Variation of Levies
Germans Pay $40 Per Cap.
ita; French $50, and Eng
lish 500, Figures Show

sistcncy and confusion of thought
which enshrouds this subject End is
another example Of the needs Of a
klndcrgartcn in economics for leading
citizens who cannot or will not think
for themselves. Germany has only
about 1000 900, 900 marks in gold and
no important gold mines. Her efforts
to make gold from sea water never
reached the commercial stage and She
did not succeed in making synthetic
gold. SO there is no way IN sight for
Germany to pay ITO billions of marks
IN new gold. and if she could do this
she would do to the purchasing power
Of the gold dollar, sovereign and franc
what she has already done to her own
paper mark.
1hc only way for Germany to pay
any considerable sum is to pay in
goods. The actual instalments may be
IN gold, but in gold will have 10 circu-
late, returning largely to Germany in
exchange for her goods and then being
used over and over agin, as is the
function Of money. Now. if we boy
cott Germany's goods we are refusing
to accept payment. 1T is ridiculous to
INSIST that Germany shall pay and at
the Same time assist that she shall not
1t s more than ridiculous: it is ask
lnE her to make bricks without straw.
And yet this is what is happening
Germany submitted to France a plan to
rebuild the devastated area by German
labor ;sri France did not accept because
OF the opposition of the French labor
and France did not accept because of
the opposition of the French labor
group. This was very grave mistake
by France. Free Trade England like
wise placed impedlmcnts through the
Key Industries act on the importation
Of German goods into England Az
soon as any great amount Of German
goods shall have been exported, there
VIII inevitably be an outcry by injured
interests in every country OF the globe
viih resulting pressure for pIotcc-
tor. Thclr arguments viii be mostly
failacious, though it is true that any
great and sudden dlslocation Of trade
IS evil, especially when an opposite dis
location must come at the end Of the
separations period.
But whcthcr fallacious or not the
pleas against the admission Of German
goods will be vociierous and must be
rcckoned with. These make another
strong rcas for reducing the rcpara-
ton BILL
New-York tribune., 1922-02-12
RcNecied in Yrude

Practically the whole of the r.para-
tons debt TO the Allies and Of the AL
lies TO the United States must be re-
hcctcd i'm the balance Of trade Ger
many, according to the official figure
at least. has been exporting goods
worth 100000, 900 OF gold marks 4 year
and importing 5000 100000. This shows
net balance Of imports Of i 800 oOO.-
coo, Whereas TO be paying reparations.
he should Show net balance Of ox-
ports Of, say, $500, 600, ,000 Can Ger
many in the next year reverse the sit
uation by tho necessary 5000 900 900 :.
Obviously not. Ones export trade can t
be forced to sucn an increase overnight
Yet how can Germany pay in gold with
out now possessing the gold. borrowing
it, or earning it from exports?
AT present Germany exports paper
money, new cXpedicnt III finance.
As the sale is forced. the price is cut;
II is estimated that over $4,000. 900. 900
marks in paper. to say nothing of
credits, are held abroad, coming partly
from private individuals trying TO hide
profits from taxation but partly from
the German government In the end
this is ruinously costly mode OF
financing, for all these chickens will
como home TO roost. These forced
sales of marks afford unparalleled bar
gains to any ono who will take these
marks TO Germany. Having bought
them for a song. he finds that in Ger
many they arc not so deprecated My
room in Berlin at a first class hotel
cost mo $50 marks day. but these
marks cost me SITS. A friend found
a good second class hotel where his
room cost 30 marks per day, which
cost him less than 80 cents AS the
mark abroad is Z per cent of pre-war
value, and at home 8 per cent in
wholesale and 3 per cent in retail
trade, tho foreign buyer gains tho dit
ference. i. e., buys at practically two
thirds OF two-hfths Of prc-war prices
Germany is overrun with tourists and
"valu ia -schwcine" or "cNchangc hogs"
who are running Off with Gcrmany's
products. A fur cap cost 400 marks or
81. The shopkeepers are, of course.
delighted, but we must not forget that
the German government representing
the whole German people originally
sold these marks for gold on other
goods. IN essence the government is
paying reparations in the fur caps, for
instance. at two gold dollars each; at
that ruinous rate she cannot get far
on any schedule or reparation
New-York tribune., 1922-02-12
Cuban Business Worried
BY Proposed Sales Tax
Measure in Present Form Does
Not Provide That Seller
Pass Levy orr to Buscr

HAVANA, Jan. 26.-Cuban business
circles arc much concerned over the
new sales tax that this Congress has
been asked to pass as quickly rs pos
siblc. The proposed tax is similar to
that OF Canada and tho Philippines
and calls for n / per cent levy on
gross sales of merchandise. The chicf
concern is tho ract that the proposed
law does not state specifically that
the seller must charge the taX rs d
separate item on the invoices rendered.
In the countries which have had OK
pcricncc with Che sales tan it is we'll
understood that the burden is passed
along to the ultimate consumer, but
the fear here is that the buyers will
make the seller absorb the tax unless
the law neccssitatcs that the amount
Of the tax be specified ON the invoices.
Cuba to-day is suffering from falling
revenues and the present tax laws
per cent on net incomes of business
ceipts, etc-are of sinai, assistance,
owing to the business crisis through
out the island. Therefore q sai-s tax
which will produce revenue either in
good or bad times, and which is cQuit-
able, will not meet serious objections.
Various commercial bodies have
written to the tax commissioners, who
are advising President Zayas, begging
that the proposed law state clearly
that the buyer must pay the tax, 80
that it Nigh be passed on to the con-
sumer.
Congress is also asked to pass law
increasing the tax of 10 cents a bag
on sugar to 20 cents whenever the
price OF raw sugar reaches 3 cents
or more a pound.
Also Congress has been requested
to put into effect again the molassos
tax of one-fourth of a cent a gallon
whenever the price per gallon is 4
New-York tribune., 1922-02-12
DiHercuce in Freight

Again. assume that the forty tons
are made up OF coal. which can be
shot into an opcn-top car and dropped
out o. the car by opening the hoppers
Mt tho bottom. There is a minimum
- labor involved. Suppose on the
boxes OF women's hats. Of long-handled
rakcs, O. COOK stoves. of bicycles. and
dozen other different kinds Of small
shipments. the chances are that il
would require "a least two cars to
contain forty tons. They must be box
cars. weatherproof. and loaded by
0and WITH various packages fitted into
space With more or less care On the
toN m!!age basis the railroads only
g c:'dlt ioi the same 900 ton miles
Gar loading is measure Of railroad
hguro 20 use to keep track of the vol
nme- Of traffic from week and from
month TO month, bLt it IS obviously
an mace uratc measure by itself OF
olther the effectiveness Of railroad
transportation CT as measure Of the
amount Of work done by railroads.
1t - the easiest thing in the world
70 accept composite unweighed aver
age, such - ton miles. and then to
write a Scleatihc-so sounding discussion
OF tie capacity OF the United States
railroads. Thus, in 1920. the railroads
earned something more than $1,000
oooooN ton miles; IN 1918 something
und"r $1,000 200. 600 TON miles; in 1917
about 3G.o0ooo0. 600 ton miles; in 1916
ami 1913 about 80, ,00O, 100000 ton miles
each. and ia 1921. 29 .000.O0 100000 ton
nlles We have tho same railroads in
1921 We had in 1920 Therefore. it is
argued that in 1921 there wa mar
Sin of capacity for business of at least
5000 600 0Oo ton miles.
New-York tribune., 1922-02-12
Workers Who Did Not Want Var PAYING
Indemnity by Mark Initiation, Says Fisher
LegisIatson Needed to Perpeh1ote
New Campaign 4 4gninst Bucket Shops

10 bucket shops
and ubtcr
these columns fortnight half prices
pointed the condition icgmac
which hourishcd the period falling
Judgment of the customer by the
During the week, tho Of
have begun active of those who
illegally take positions opposite their
selling as brokers' Rigid enforcement Of the
helpful but the
into legislation which oopholes which NAV
be shown o exist--M S
New-York tribune., 1922-02-12
Cap Bcf,rccn Glasses

The war has thus thrown Germany
and all middle Europe into the un-
healthy "Russian" condition Of an up.
per class. lower class and a gap be
tween. Among the consequences of
this situation is political instalibitl
In Russia we know what happened.
Apparently somewhat similar class
struggle is fast developing in Germany
tire rich against the poor, with too few
in between to keep the balance true
The Ebert regime. like the Kercnsky
regime may prove too unstable to last
especially if further imitation further
destroys the middle class. In this
class struggle the poor arc losing eco
nomically. And yet. politically, the
working class is in power.
The government has not yet proved
strong enough to levy the taxes needed
TO replace imitation, and ono great rca-
son for this weakness is that the Gor-
man people, especially the working,
mon, do not yet sec clearly. the evils
Of imitation. 1t is simply ono more in
stance Of the need of elementary edu-
cation in the simple foundation truths
OF economies.
1t is not realized, in the first place.
that printing paper money to pav GOV
ernment deficits depreciates the mark.
nor, in the second place, that this de-
probation is an indirect tax on the
poor TO take up the first point first. |
was astonishcd to find in Germany the
same almost universal ignorance of the
chief cause of high prices which have,
IN my two previous articles, already
noted in England and France, for had
supposed the fall of the mark was so
striking ss to compel explicit rccogni-
ton. In America We all know in a
general way that the mark has fallen
and why it has fallen But in Germany
probably not one person in ten knows
this elementary fact.
A friend and fellow economist. Pro
lessor Roman, and | questioned about
twentN-iiv people, fair samples os all
classes. and found only two out of the
twenty-five who seemed in the last to
understand the situation: and of these
two one was an accountant and the
other a German American. Even in off,
clat circles I am assured by several
competent Observers ma aiority do not
know Cor profess not to believe) that
imitation of money has raised prices.
say "or profess not to bcleve.' be-
cause my own observations in all
countries, America included, have
driven me to the conclusion that those
who are most directly responsible for
imitation try to blink the fact and to
pin the responsibility elsewhere.
Professor Roman and | concluded
our search for an honest knower in
shop kept by two intelligent women.
After buying many of their wares we
asked them XII ythc prices were SO
much higher than formerly. Their
first reason was thot wages and the
other costs they had to pay were so
high; that is they sought to explain
the prices they charged us by the
prices theirs charged them. A dozen
other equally superficial reasons were
given ending with the "cxtravagancc of
the government" Questioned on this
point they said the government did not
live within its income. On hearing this
our hopes were high that they would
next score the government for paving
its deficit by means of the printing
press No such reply being forthcom
ing, sought to draw it out by asking:
New-York tribune., 1922-02-12
Pnrtinf II rifp-Ofs

The new provision doss not permit
n deduction in 1921 of cha rye offs made
in prior wears unless the trapsactlo on
is finally closed The Department mas
ruled that 40 deduction VIII ne Above
for the part Of a debt aScertasned %
be worthless and charge Of prior 70
January J. 1921, unless and Until the
debt is asceItained 20 be totally worth
less and is finally charged OF. Or j.
charged down 10 nominal amount. or
the loss is determined in some other
manner by q closed and completed
transaction. Thus, creditor, who. in
1920. wrote down debt 80 per cent.
may not, under the new provisions o.
the aw. take deduction in 1927 or
occount OF such partial write-otf put
must wait until the debt is finally
closed out, a. which time the total
loss sustained may be deducted.
In determining whether debt /
worthless in whole or part. the Com
missioner OF Information Revenue viii
consider all pertinent facts, including
the value Of the collateral. If any, Sc
curing the debt and the financial con
dition Of the debtor. Partial Geouc-
tions VIII be allowed with respect 10
specific debts only The Commissioner
has ruled that where banks or other
corporations. which are sub ect to SUI
pervision by Federal or state autnori
ties. in obedience to specific orders or
IN accordance with the general policy
OF such supervisory officers. have
charged Oft debts in whole or in part.
such debts. in the absence of affirma-
tive evidence clearly establishing tho
contrary, shall be presumed. for in
come tax purposes. TO be worthless or
recoverable only in part. a the case
NAV be.
The bad debt provision extends also
to debts evidenced by bonds or other
similar obligations. A taxpayer ether
than a dealer in securities, possessing
debts evidenced by bonds or other obli-
cations. cannot deduct from gross in
come any amount merely on account Of
market fluctuations. Where a taxpayer.
ascertains that due. for instance. 10
the financial cndition Of the debtor or
conditions other than market fluctua-
tions, he will recover upon maturity
none or only part OF the debt evi-
denccd hy the bonds or other similar
obi cations. he may deduct in comput-
ing net income the uncolicctabc part
+ the dcbt evidenced by the bonds or
other similar Obligations
In lieu of deduction for specific
New-York tribune., 1922-02-12
Seasonal Traffic Increment

INC seasonal movement Of traffic also
mas a profound effect on the capacitv
or fne roads. Thus If tho Seaboard
AR iAno could get additional traffic in
me summer IL would put no strain or
'ne faci!ltles Of the road, because the
ScAhoard Air Lines heavy traffic move
ment IS IN the winter. On the other
hand. with the Northern roads the
heavy traffic movement is in the fall
and December and January arc LIGHT
months. OF course, the CAPACITY Of q
Northern road is lower in December
and January than in summer because
of uaiaVorablc weather conditions. but
TINS does not affect the general line
of argument
As illustrating the various factors
winch enter into discussion of the
capacity of American railroads. let us
take month OF heavy traffic. such as
October. In October, 1917. the average
miles run by each freight car was
26.5; in 1918. 26.2; in 1919, 27.3: in
1890. 26.9; ard in 1921. 2sS. 1t will be
noted that the milage per car per day
WAS better in 1921 with its 10000 600
--Jo tons Of freight than in 1918. with
- ea2rly 3,7so 900 ,Q0O-ton miles.
The average number Of tons of
fre ght loaded on each loaded car lit
viii be noted that the mum Der of empty
cars is not taken into consideration in
figuring the average was 277 in
October, 1917: 29.7 in 1918, % in 1919.
29.9 in 1920 and 2722 in 1921.
The percentage Of unserviceable to
total freight cars for October. 1917.
was Sc. in 1918, 8: in 1919, S.5 in 1920.
g. and in 1921 13S
New-York tribune., 1922-02-12
Bad Debt Deductions
Permitted i'm New Tax
One Of the Most Important Changes :,
Revenue Regulate ions forBusincss
Concerns: Other Variations
BY Morris r. Frey

Ass'sio Treasurer, Gun,onty I,ps Copyoay n Nop y1
{ (NUBSTANTIAI. made in 1921
affecting deductions allowed in computing sub oct
49, Ono Of the most important Of TO
is that permitting deduction bad taiv
reasonable for bad debts Under
by the Bureau Of Internal had t
bave been determined to be worthless by corpld
boe such debt could return az
New-York tribune., 1922-02-12
Variety of Factors

These examples are cited merely in
xn attempt 10 call attention to the
variety Of factors which must be taken
into consideration when an attempt is
made 10 generalize about the whole
coantry's railroad capacity.
WITH these limitations in mind it Is
possible to make certain broad gen
Civilizations that will be pretty likely
New-York tribune., 1922-02-12

As Z measure Of the effectiveness Of
work done by railroads this IS about
as good a unit as can be used. but as
a unit of measure Of capacity OF rail
roads It needs q great deal Of expana-
zion and mod fcation. Take for in
stance, the case Of the forty tons of
trclght moving 20 Philadel phia-if
thorc Is return load Of forty tons
waiting for the car. the work per
formed by the cars round trip is
200 tor miles, hu; # the car has to be
sent back empty the work performed
! sorly 3.600ton miles. Actually the
amount Of fuel consumed hy locomo-
tives and the number Of train en-
ployees hours work are about the
same for the production Of 3.60o-ton
mile IS FOR the production Of 200 ton
miles ln th.s iNtance. Say that in
stead Of ninety miles the haul was only
twenty miles. me number of ton miles
would be but SOC. while the work Of
loading and unloading The freight
would bc lus, the same As FOR the pro
cuctlor o. . 3.fOo-ton miles
New-York tribune., 1922-02-12
Investor Should Watch
Capacity of Railroads
Those With Greatest Facilities Viii Bcnc-
fit Most From an Increase i'm Traffic:
Some Technica lities Explained
By William f. Hooper

TTNhkRE of
OF them be
measure The number of ton miles freight
Standards but A
of loaded with forty
ninety miles this
New-York tribune., 1922-02-12

t. be borne out by detailed tests Of
their accuracy.
1t is reasonably certain that in 1921
no conside rable part Of the United
States railroad mileage permanent
way) was being worked to within 20
per cent OF capacity. assuming no great
cnange IN the character or direction
Of freight traffic movement
Furthermore. throughout 1921 the
large ma jority OF railroads had Doth
reight and passenger locomotives,
especially freight locomotives, stored,
laid up IN white lead. as it is tech
nically called 1t would not, however.
be safe to apply the 90 per cent figure
20 the motive power situation, because
i. IS probable that in 1920 there were
locomotives used in service which were
quite uneconomical, and it is no. ac
cuiate to say that the strain put ON
TIE use of motive power and the Ie-
sultiR" abnormal expenses in 1921 is
fair measure of the railroads ca
pacitv. In other words. a resumption
Of traffic must mean further orders
FOR locomotives by many railroads.
Car Supply
The customary way of measuring the
freight car supply of the country is to
compile a table showing car surpluses
and car shortages. This is arrived at
By averaging tclegraphic reports re-
celved from each railroad, showing the
number Of empty cars not requested
for loading and the number of requests
for cars for loading that have not been
complied with. When there are more
cars on hand than requests. q car sur
plus is shown, and when more requests
than cars on hand. a car shortage is
shown. In 1921 there was during the
entire year. surplus Of box cars on
all the roads OF the country. varying
from nearly 100000 during the months
of January TO Nay. inclusive. to 22.oO0
about the hlst Of Novomber
There was a surplus o. fiat cars
varying from 5000 to 5000; surplus
Of stock cars varying from nearly "a
600 in the months of April, May and
June, to 5000 in October
On the other hand, during the entire
year 1920 there was q considerable
shortage Of all classes of cars. VARYING
from 10000 box cars to about 100000.
on the average. for the wear in stock
cars
1t is obvious from these figures that
any large resumption of business ac-
tlvlty and fire light movement will ne
cessltate two things q reduction Of
the "A per cent OF cars now unservice-
able and the purchase Of additional
equipment The fact has already
been recognized b. the stronger rail
roads and several fairly large orders
for cars have already been placed with
builders