The Kennewick courier-reporter. [volume] (Kennewick, Wash.) 1914-1938, 1923-02-15


whole country. The re-enactment of
such tax would be distinct set
back to everyone. Natural resources,
available labor, nor even capital is
sufficient to make country pros
porous. Russia is rich in natural re-
sources. Africa labounds in avail
able labor, andin every country where
money is cheapest business is at its
worst. Prosperity is really the re-
suit of initiative courage and hope
fulness. These intangible but all
important forces are the result of
encouraging business. We cannot
get prosperity by putting ball and
chain on the enterpriser.
Inheritance taxes may be increas-
ed without affecting business. Con-
gress may even increase the tax on
incomes from stocks and bonds with
out hurting the farmer, but re-en-
actment of the Excess Profits Tax,
which paralyzes efficiency, enterprise
and initiative, would be distinctly
harmful to all sections Of the country
and to farmers, businessmen and the
wagearners alike.
These figures on government re-
ceipts and expenditures have direct
relation to investors. They mean that
the present demand for non-taxable
bonds will continue. A good many peo-
pie who have their money in tax
able securities have continued to hold
these securities and pay tax on I
them with sub-conscious hope that !
some time, some day, some how, some
where, their taxes would be reduced.
A statistical study of the situation
leads on to believe that higher taxes
are here to stay, and that it will be
a real feat to keep them down to
present figures.
can interest in tax-exempt secur-
tiles may also be increased by a con-
amendment preventing the
sale of any more stax-exempts.' A
resolution to this effect is before
Congress at the present time If it
is passed, it will go before the states
for ratification. 1t will be long
time, however, before such bill will
get the necessary two-thirds of the
states to sign it, that it may become
a constitutional amendment. Even
# enacted it, of course, could not be
retroactive and cannot affect the tax
exempt securities already issued. The
very agitation may tend to bring out
i rush of new issues which will have
!, depressing effect on the municipal
,ond market in spite of the strength
,ning tendency which many people ex- !,
,ect.
Cali this MEANS" concluded Mr.. ,
3abson, "that the very large invest
rs will continue to hold the tax-ex-
mpt securities but there is no reason
Thy the average investor should stam-
,ede to secure such issue. The bond
rop is one crop that has never yet
een known to fail. Many people be- Il
ieve that owing to the improved con-
itions, money will be much higher
nd that all bonds will decline in
'IiCc tuS uS4t lew AlOuIuS. /
his may be true, but seriously
loubt it. Altho the Babsonchart
lands today at go above normal,
which would ordinarily. signify that
We are entering another period Of in
lation, statistical study strongly
uggests that this present optimistic
igure is only temporary. The great
adjustment which started over two
ears ago is only about 500 COM
,lete. My prediction is that bond
'rices in 1923 will average about the
anne as the bond prices in 1922, and
he 'tax-exempts' will follow the gem
raj market. III
''It will be safest for investors to
cunt on present high taxes contin-
ling, even if Congress has sense
nough not to re-enact an Excess
'rofits Tax" -.