Evening star., 1924-03-20
CHAPTER XIV.
Paying the Bills for Uncle Sam.

! 1t is easier to pay $4,000 a minute
today for federal expenses than it was
$1.6oo a day in 1890. Those early
days should ever be a lesson in heroic
endeavor for these later days. 1t was
John Adams who. in 1774, wrote in
his famous diary: I'VE have not men
fit for the times. We are deficient in
genius. in education, In travel. In for
| tune. in everything"
The next fifteen years were dark
ones. Was John Adams right after
all? Would financial daylight ever
come?
From 1775 to 1873 the Constitutional
Congress issued s241.522.OOo un-
secured paper money, while the
several states add ID 1909 524 900 more
to this fantastic total. 1t all became
worthless. 1t finally took 'bushel
Ss,ns Sf money r,s to purchase a peck Of
ia continental" comes from the worth
less paper money used in the dark
! days Of the Continental Congress.
Picture this little nation in 1890 Of
100000 population. about Dne-sixth
of whom were col red. mostly slaves.
There were then but. six cities with a
! population of $500 people and over.
Today there are over 1000 such cities
In the country. At that time New
york was ths largest. with $4,000
cities in the United States larger
/ than New York was when George
Washington drove a team of horses
from Mt. Vernon to New York to take
the oath of Office as President. and on
the way got stuck In the mud.
Trade with foreign nations amounted
to s21 100000 a year. More business
goes in and out of American ports
every twelve hours now than went
in and out of the nation for the whole
year 1890.
The confederation of the thirteen
states. which took place after the
revolution, was failure. The states
were not satisfied, neither was the
federal government. which some one
called 1rope Of sand" Finances
were in a mess. credit was exhausted.
bills were unpaid. accrued interest on
both state and national bonds was In
default. Regulations seemed about
the only way out. Stern necessity
forced the calling of the Constitu-
tional Convention of 1887.
What Constitution Says.
BY 1889 the Constitution. had be-
come the fundamental law Of the
United States. Fourteen different
sections of that great work deal with
the subject of finance. Three para
graphs contain the meat. Here they
are:
1. "The Congress shall have power
to lay and collect taxes. duties. inn
posts and excises; to pay the debts
and general welfare of the United
States; but all duties. imposts and
excuses shall be uniform throughout
the United States"
2. mo capitation or other direct
tax shall be laid unless in proportion
to the cenSuses or enumeration here
inbefore directed to be taken"
8. THE Congress shall have power
to lay and collect taxes on incomes
from whatever source derived, with
out apportionment among the several
states and without regard to any
census or enumeration.
No. 3 is an amendment adopted in
1913 to neutralize the effect of No. z.
augurated and before Hamilton be-
came Secretary of the Treasury,
James Madison. on April 8, 1888. laid
the subject of national revenue be-
sentatives. He proposed tariff or
such articles of requisition only as
are likely to occasion the least de-
lay"
Let US remember that the thirteen
states were not now permitted to
"coin money; emit bills of credit
make anything but gold and silver
coin a tender in payment or DEBTS:
The act of July 1, 1862, is the basis
of the present revenue system. bot"
as regards the objects taxed and the
organisation for the collection OF the
taxes. The act created the office of
commissioner of internal revenue
In our first year u7sD: ss.6 per
cent of all the government receipts
came from customs duties-that is.
from fees collected on goods of other
nations entering the United States.
Internal revenue receipts were very
small until 1863. The greatest amount
collected from this source during this
tional. existence was in 1915. when
S5,124,000 was collected But it was
only Is per cent of the total receipts.
Land Sale Proceed. Trivial.
During the early period and even
afterward, some fees came from the
sale of public lands. but the total
receipts from the sale of the great
lands of the United States from 1871
to 1928, inclusive, were less than
$500 600 900, a little more than one
months expenses for this year.
So up to 1852 ,aas we may say amt,es ssa, were ae
used to pay 50 per cent OF the total
federal expenses.
The civil war brought US ma
tional income tax for the first time.
Also new stamp taxes and other in
ternal taxes. Everything was taxes.
The federal government needed huge
revenue. and nothing was neglected.
In 1866 about $73,000,oOO OF income
tar was collected. From that high
point the income tax decreased, and
finally died out by 1874. But the in
ternal revenue continued. 1t never
from 1855 on has yielded less than