The Dawson news. (Dawson, Ga.) 1889-current, 1924-12-23
COOLIDGE OPPOSES
SUBSIDY EXPANSION
SAYS EFFICIENCY OF STATE
GOVERNMENTS IMPAIRED
BY TREASURY GRANTS.
BRIDES THE STATES TO SPEND
States, Counties and Cities Encourag-
ed to Spend Money and Incur Heavy
Debts to Get Appropriations From
Federal Government.


Federal Government.
WASHINGTON, D. C.-President
Coolidge's recent address to congress
alludes to one aspect of taxation that
is giving much concern to thoughtful
persons in Washington His a1lusion
was Enthusiastically clear and force
full and more will be heard of it. Some
leaders believe it can be made the ba-
sis for an important change of trend in
public affairs, President Coolidge said.
For federal aid to states the esti-
mates provide in excess of 100000
| 900. These subsidies are prescribed by
law. | am convinced that the broad
ening of this field Of activity is detri-
mental both to federal and state gov
ernments. Efficiency of federal opera
| tons is impaired as their scope is I'M
duly enlarged, Efficiency of state gov
ernments is impaired as they relin-
quish and turn over to the federal gov
eminent responsibilities which are
lrghtfully theirs. | am opposed to any
expansion OF these subsidies. My con-
viction is they can be curtailed with
benefit to both the federal and state
governments"
Three Per Cent of Budget.
The amount the federal government
pays out to the states is great enough
in itself The sum of $l09,000,000 is
about 3 per cent of the total federal
budget. But as the president says,
the effect Of these grants to the states
is worse than the amount of them In
nearly all cases this money is given
out to the states on the condition that
the states themselves raise specified
amounts. Some of the money is Civ
en- to the states to help build roads on
condition that the states spend similar
amounts Some is given to the states
/ to carry out variou projects originate
ed by the federal government, such
as maternity care.
! While President Coolidge spoke of
! these sums as subsidies, some others
speak of them by the stronger term
of brides" meaning that they slim
ulate and induce the state govern
ments to spend money and increase
taxation. A few state governors have
seen this aspect Of the case. When the
federal government sent the governor
of Maine $4,000 to spend OH maternity
care the governor returned the check
with a letter which is a classic on
sound government. Massachusetts like
wise refused this government grant,
pointing out that for every one dollar
the federal government sent into the
state it took out $18 in income taxes.
Stimulates Spending of Money.
Partly as a result of this stimula
ton by the federal government of ex-
pendtures by the state governments
the borrowing OF money and the in
creasing OF taxation by state, county
and municipal government is going on
at a pace which some thoughtful per-
sons regard as most unfortunate.
Garrard B. Winston, under secre-
tary of the treasury, has pointed out
that while the per capita tax levied by
the federal government would be cut
from $2o to ST this fiscal year the
per capita tax of the states and mu-
inequalities is increasing.
with the states and municipalities
the opposite tendency is disclosed"
Mr.. Winston said I'm 1913 their per
capita tax was something over $50. In
THE next four years it rose to $27, $50,
$50 and $38, and the latter figures un-
doubtedly will show further increase.
This contrast between the reduction
!, of taxes by the federal government
and the increasing of them by local
state and city governments is vivid.
The annual appropriations are of
two classes: First, expenses arising
out of paying for the war, which can
not we'll be controlled now; and, sec
ond, the ordinary expenses OF running
the government. Iffthe first be elini-
mated it will be found that as regards
the second the government is being
run at an expense only about 80 per
cent above the pre-war cost There
are very few corporations, or for that
matter few households doing as well.
State, City Expenses Grow.
But with the state and other local
governments it is a different story.
They have no war debts to pay, yet
their borrowing and their taxes are
being increased at a rate such as to
make certain difficulty in the future.
In 1912 the total money that had been
borrowed by local governments was
S3,S22 100000 By 1922 it had been in
creased to $500, 100000; and this
year the total amount OF long-term
bonds owed by local governments is
estimated by the industrial conference
board at $l0,500,000 They say that the
increase the present year alone is be-
tween eight hundred million and a
billion 1t is to pay the interest on this
debt that the owners of farms, homes
and factories face steadily increasing
taxation Very few farmers pay any
income or other taxes to the federal
government. 1t is the constant incur
ring Of debt hv local states and coun-