The Birmingham age-herald., 1923-04-16
BU5INE ESS MEN ARE OPT MYSTIC OVER CUT IN TAXAT ION
Easier Money Market Has Little Effect Upon Com
 merCiaI Paper
By WALTER E. BROWN
 Editor New York Commercial ipeciaI Dispatch to The Age-Hcrald

SDGNIdl iBANPhANH Nb AhS
 NEW YORK. April 15.--While there is slightly easier market at the moment for time money, it has had no perceptible effect upin conner cial paper, which is still discount ing at per cent for the highest grade bills. Short time money is likely to remain firm for the next few months. Within the next 60 days the government vii need ap- proxinately S1,25O, ,000,O00 for re- funding purposes and interest pay ment The first payment of S125,- GOO, 900 is due as of the 18th while on May Is, additional payments will be due, and on May 20, about $S00,- 900, 900 of Victory notes mature
 Competition for labor will have tendency to advance commodity prices, especially as higher wages are almost invariably accompanied by decrease in efficiency. Fed eral reserve rediscounts do not show any alarming increase The total for the week of April II amounted to s8e7,O39, 900, as compared with s95b, 100000 the previous week and $667, ,151, 900 q year ago. This, how ever, is very different from dis counts exceeding $3,000, ,000, 900 in 1920. The reserve note circulation is now s2231, 1,041 ,0O0 which is slight ly under the preceding week and compares with $2.2O0,305,000 year ago, but compares with S3,404, ,941,- 900 December 23, 192g This, of course, represents the lower level of comod1ty prices because labor is just as fully employed now as 1t was then.
 edn
 One of the most hopeful develop ment IS the declaration on the part of the administration of it's desire to reduce taxes. Secretary Mellon. en- outraged by the increase of s70.00o.- GOO in the tax receipts for March, Is of the opinion that the higher sur taxes can be reduced. He is looking at this, of course. from the practical standpoint of encouraging capital to enter industry where 1t now seeks asylum In taxexempt securities President Harding proposes to go point further and reduce tax rates from top to bottom. He In turn, is giving more consideration to the po- litical effect It may be that some of this is making the wish father to the thought, but in any event, 1t ere ates a backfire against the radical group In Congress that Is intent on restoring the excess profits tax and other vagaries of taxation. The an swer of the radicals will probably be to maintain or increase the higher brackets while exempting incomes below $5,00O. The probability is that there will be no changes of any kind at the nxt sssion,a $sa.-v zbh-ee at the next session of Congress.
 Wall street is rather doubtful as to hat n "a h tho r9f1rnadS n consequence of which the rail stocks have been rather neglected. The na- ture of this misconception Is illus trated by the statements made by Senator Capper of Kansas, leader of the farm bloc, in recent news paper interview. He declared that under the present schedule of freight rates, the large roads are making too much money, thus throwing improper burdens upon the farmers and ship pers He also proposes to repeal or modify Section 15A of the transpor- tation act. which he calls the guar antee clause" or rate making pro- vision.
 No Guarantee Clause.
 There are a great many individuals who ought to he better informed who insist that there is a guarantee
 
 there is no such thing. The rate making section merely stipulated that rates shall yield fair return on the valuation of the roads, It gave the interstate commerce com mission two years in which to under take such valuation and in the mean time named 51a per cent as such fair return, and in certain cases, per cent. This latter provision expired by limitation on March l, 1922. The interstate commerce commission has since made 5& per cent as fair re- turn, but at no time since the gov ernment relinquished control of the railroads have they earned even 51f per cent. Nevertheless, there has not been single claim upon the govern ment to make up the difference, be- cause there is no provision of law under which 1t could be done. Sec tion 15-A merely outlines the basic for rate making, but does not in any sense guarantee a definite return. Yet Senator Capper and other west