Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-02-19

for the railroads, They affect en-
ployment so generally and are SO
influential upon sentiment that they
make the pace to which others con-
form. In neither case is there
quite the necessity for activity that
there was a year ago, but IN both
cases the needs are. still above
: normal.
Industrial corporations are giving
evidence of there confidence IN the
future by adopting plans for IN"
creasing their capacity. 1t was com.
mon talk after the war that the steel
industry had been expanded beyond
probable needs for ten years or more,
but A number OF the leading CONF
panies have been charging since theiL
and the u. S. Steel Corporation mas
planned S15,000,D0N of the capital
expenditures in 1924.
The very condition which IS the
chief cause of uneasiness, the high
scale of industrial costs, like the
house rents, is a stimulus to some
forms of industrial expenditure. 1t IS
causing a most searching study OF
costs to be made and the instal!a-
ton of much new equipment for
the purpose of reducing. them.
The papers from day to day are
CARRYING announcements OF new
processes, some OF them OF very sig
nifcant importance. Hydro-elec-
trio development is going on at an
unprecedented ratc,but by no mean.
tells the whole story OF electrical
development. More than $7O0,0O0.
coo of new capital was invested
last wear for additions to steam and
hydro-electric plants, transmission
lines and the general equipment or
distribution, while the total invest
ment in the central stations Of the
country is now nearly six billion
dollars. 1t is stated that eleven
important new power stations Will
be completed in the State of PENN
sylvania before the end of 1924.
Electrical energy is one or the few
cost-of-living items that is lower now
than in 1918, and this is suggestive
of other developments under way.
Tax Reduction
The probability of a reduction OF
taxation is one of the most stimu-
lating prospects. The progress OF
the Mellon program in the House
Committee indicates that substantial
reductions certainly will be made,
but the outcome upon the higher
schedules is yet undetermined. This
is precisely where the largest benefits
to the business community are to be
secured. Mr.. Mellon has followed up
his original argument Tor lower sur
taxes 30 vigorously and effectively
that he must have made the case
very clear to most readers who have
followed him, and the business pub
lie has supported him in a manner
that has made the talk about prop
uganda weaken perceptibly.
The essence of the case is that the
revenues now being collected on the
high incomes consist OF capital that
would serve the country more eff
fectively in production and tina. in
addition to this a much greater
amount of capital is made unavail-
able for new business enterprises by
being driven into the tax exempt
class OF investments. 1t is worse than
farce for the government to levy
taxes running up to s. per cent. of
an individuals income while tax
exempt securities paying AZ to per
cent interest are available in abun-
dance. OF course. nobody with the
high incomes will pay these taxes
Unless his capital is already invested
in such manner that Il cannot be
shifted without heavy loss. The ievies
therefore become heavy discrimin-t
atory taxation, paid only by individ-
uals whose investments are subject
to the risks of business, and act as
a deterrent to new investments Of
this character. It is unintelligent tax
alton from the standpoint of the
public interest because it takes prac-
ticaIly nothing except funds destined