The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1923-05-03

and economist in the Philadelphia
ublic Ledger)
/ favor, and have always favored,
the principle Of progressive income
tax, but, like every other principle,
however sound, it must be applied
within the rule of reason and with
that discrimination which takes ac-
count of practical considerations and
-. consequences.
Much of the largest part of the ma
tons liquid capital is owned by those
of small and moderate means. either
in the shape of direct investments or
through deposits in savings banks or
with life insurance and kindred insti-
tutions, But the funds so held are
not generally speaking. and ought
not to be. available for starting and
financing new and untried enterprises.
The man of small means ought not
and as a general rule will not. and
savings banks and life insurance con-
Germs do not, and indeed under the
law must not, place funds otherwise
than in seasoned investments.
The capital which can afford to
take. has an incentive to take. ought
to take and heretofore has taken, the
risk of starting and financing new en-
terprise and doing the pioneer work
of the country is that relatively small
percentage of the nations total cap
ital which is represented by the avail
able funds of corporations and we'll
to-do individuals.
That is a most valuable function
for the nation. and that function has
been woefully crippled by the existing
surtaxes, both because they have pre-
vented the accumulation of capital
and because they have largely inn
paired the incentive to venturing and
risk taking
A register of the characteristics of
our present schedule and system of
supertaXes would include these items;
First. 1t bears the imprint of class
and sectional discrimination.
Second. 1t is unscientifc. nequit-
able, vexatious and uncertain in it's
operation. and getting steadily less
effective in producing revenue.
Third. 1t encourages and facili-
tates governmental extravaganza and
at the same time diminishes the in
centive to the careful outstanding of
private resources. thus discouraging
saving and self-denial and promot-
ing private extravaganza
Fourth BY appropriating and
draining into the Golfers of the gov
eminent a preponderant share of the
liquid capital which ought to be avail
able for business and investment, it
hampers enterprise, defects the nat
ural and fructifying flow of capital
and prevents that degree of accumu-
lation of funds which is needed for
the normal conduct and due expansion
@ fthe nations business and for the
country's development
Fifth. 1t causes economic disloca-
ton and maladiustment diminishes
the country's purchasing and consum-
ing power tends to curtail production
and makes for higher costs.
sixth. In that it penalties the
working capitalist, the man engaged
in active business and in productive
enterprise, as against the idle capital
list who simply puts his funds in tax
exempt securities it prevents many
business transactions altogether, and
causes others to be done in round
about and artificial manner.
Seventh. BY curtailing excessively
that incentive to effort and venturing,
which relates to the expectation of
material reward. it strikes at the very
basis of the system of individual en-
terprise and initiative, upon which !
our social economic and political sys-
tenn rests.
The country's prosperity is a mat |
ter Of manifold. complex and delicate |
interrelationships, and he who would /
lead the people to believe that they 4
can be benefitted-or indeed, that /
they can avoid being greatly harmed |
by oppressive taxation of capital de-
ceives himself or attempts to deceive
others.
The conception of piling enormous
taxes on the top in the expectation
that they will not percolate down
ward is fallacious.
by reason of their very extremes.
the high surtax rates have defeated
their own purposes. or rather that OF
their advocates. The country is af-
nicted with the troublous conse-
quences flowing from the operations
of the existing tax schedule without /
even gaining the advantage of the
revenue which was supposed TO re-
suit from it, The higher brackets of
the surtaN schedule have ceased more
and more to be productive To con-
siderable degree they have abolished
themselves, but in the wrong way.
The official figures show that the
aggregate income subject to the high
er snrtaxes has been reduced 10 less
than One-half Of what it was in the
first year of their existence and the 4
aggregate of taxable incomes exceed