Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1924-01-17
WHAT THE BRITISH
PROPOSAL To LEVY
on CAPITAL MEANS
By FREDERIC J. HASKIN

ArT
Ramsay Mcdonald, the party chief.
In rosition where he yields a
tremendous Political influence, may
have an important effect on the
United States because of the advo-
cacy by the Labor party Of capital
levy. The parliamentary situation Is
somewhat confused, being not dis
similar to the situation in the Amer
lean congress where it Is dlf1lculT
to say which group is actually on
top, Tut Labor seems TO be gaming
in England.
The capital levy, which was made
one of the election issues by the
Labor party, would mean that an
wealthy persons would be compelled
to turn over to the government
large percentage of their property.
J A man worth 900 pounds sterling
would have to turn oveG approx
mately 5000 pounds of his wealth.
fIf he could not pay such a sum IN
Nash, he would have to give the gov
ernment securities, deeds to prop
erty. or possessions of other kinds
sufficient to make up the 5000 pound
levy.
Economists all over the world are
vastly interested in the plan ana
there is sharp difference OF opinion
on the effect of su2h an acton. 1T
is still doubtful whether the LABOR
party can muster enough strength
to bring about the capital levy but
the threat is sufficiently real to have
frightened property holders.
AS in the case of almost every
other human proposal there are TWO
distinct sides TO the question. 1ns
view taken by the Labor party Is
that there are many great estates III
England which bring in 10 tneT
owners large incomes In the form
of unearred increment, that 4s' III
comes not dependent on the personal
effort of the recipient. Also, the LII
hor men assert, there are many new
fortunes built up from war profits.
The working men who went to war
lost treir Jobs, and the small trades
men lost their businesses.
Business Dull; Taxes High
Two million workmrp aHe out OF
employment in England and bust
1ess generally is dull. Taxes of all
Kinds especially tho income tax, are
LtTV nl2n-llluNiE !llG- lACL A'e'i- -
limited States. The Labor party says
that while the older rich iamllles
are continuing to enjoy their I'M
earned incomes and while the war
prcfiteers are living iE luxury, the
rnen who went to the fr5nt are SUI
fering lard times. They say mat the
Wv to correct this maladJustnent
is for the government to levy tax
on carital. They want The govern
j ment to take away about one-seventh
of the wealth OF every En2llshman
who has an estate valued at 5,00o
: rounds sterling, or approximately
$4,000.
Tho advocates Of the capital levy
saw that this sort of Il levy would
raise 3 400, 600, 900 pounds sterling.
This would be used to retire IN
Z eqr:yalent portion OF the national
debt. With the debt reduced by such
an amount, taxes could be lowered
end everybody would be hctter off.
Under lower taxes, business would
revive and the unemployed could
have a better chance Of getting
SCrk.
= The Grsuments against the plan
, are as numerous as those which
have BEEN put forward in favor OF
It. Both sides are incliI cd to fight
hard for their respective positions.
The American people have a diract
interest in What happens fer two
reasons.
If the claims of the labor party
are sound and such a levy would
work as they say, England could
hpr 6pht 70 the
United States. This would permit
of reduction of American taxes, for
our national debt would be CORE
spondingly reduced. Further, if
business, revival and more general
employment resulted from the levy,
our trade with Great Britain would
be improved.
Generally speaking, business men
and capitalists oppose the levy, de-
claring it would mean disaster, panic
and depression in Great Britain.
Such an event would hurt trade
with this country seriously, so the
Failure OF the plan as much as it's
success would mean much to Amer
leans.
Opposition Arguments
The opponents of the capital levy
point out that there is no great bulk
of free wealth in England or any
where else which would be available
for capital levy. They assert that
the wealth consists of credit and i'm
movable property rather than tam
gible funds which could be turned
over readily to the government. A
typical case is cited to illustrate
how the levy would work on the
middle classes of business men. A
manufacturing business which en-
ploys some scores of persons. He
makes a fair gross income, but must
his debts, buying his raw materi-
ais and employing workers.
Although rated at being worth
100000 because his business ac-
tually is worth that much, he could
not possibly put his hands on one
seventh of that amount in cash to
pay a capital levy. He would have
to lay off abut half his workers,
reduce purchases of raw materials,
collect all the cash owed him, and
borrow what he could get to get the
needed sum. Then he would be able
to proceed on a basis of about one
half that he previously had main
tanned.
The government would get It's
money from him. but some dozens
of persons would be added to the
army of unemployed, the companies
from whom he bought raw materi-
ais would lose a good customer, and
the amount of goods he annually
added to the wealth of the country
would be cut in two. The case of
such a man is declared to be typ
ical of the larger number of bust
ness men on whom the levy would
fall.
In q SsnersS way, the levy would
affect the great fortunes in a sim
liar manner. Very few great for