The daily worker. [volume] (Chicago, Ill.) 1924-1958, 1924-06-24
BOOTLECGER TO
CABINET DOES A
LITTLE JUGGLE
Mellon is Wizard at
Figures
B y LELAND oLDs,
Federated Press Industrial Editor

"Oust Andrew Mellon as unfit for
the office of Secretary of the Treas
ury!" should be an important slogan
in the coming presidential campaign.
For evidence is multiplying that this
DISQUALIFICATION magnate has
used his office as an opportunity for
deliberately deceiving the public with
incorrect figures in order to serve the
interest of his little clique of multi
millionaires who are CALLED by high
income surtaxes. In collision with
them he has been systematically
working to relieve the money trust of
its just share of the burdens of taxa
ton brought upon the American peo-
pie by the profiteers of the world war.
Most recent proof that Mellon mis-
represented the facts in his rich
mans propaganda is found in the fed
eral trade commission report on tax
alton and tax exempt securities sub
mitted to the Senate in response to
resolution introduced by Senator Nor
ris of Nebraska. Mellon attempted to
make the country believe that it was
losing 5000, 100000 year in taxes be-
cause high surtaxes drove rich men
to invest in tax-exempt securities. The
commission, using figures available to
Mellon, shows that less than one-sev-
enth Of the tax-exempt securities are
in the hands Of people with incomes
of $4,000 year or over and that the
maximum possible tax on their inter
est would have been about sos 100000
or a little over one-fourth of MELONS
figure.
Commissions Figures.
The report says in part:
BASED upon returns from several
thousand individuals with incomes
ranging from $4,000 to and in excess
Of a million dollars, the commission
estimates that in 1922 out of total of
approximately thirty-two millions of
wholly or partially tax-free securities,
federal, state and local, four and one
half millions were owned by the
wealthy individuals. On the same
basis business corporations owned
nearly twelve billions, while S16,770,-
600 were held by all others, consist
ing principally of individuals with
small incomes.
"The tax-exempt interest received
during 1922 by individuals whose tax
exempt incomes exceeded $4,000
each is estimated at nearly S176,000,-
Oeo. OF this over S97,oO0,0OO was
wholly tax free and over S7S,000,00o
was conditionalIy subject to surtax.
.s4lmu a. y this = sst,
had it been taxable at the 1922 rate,
would have been about $5S,000,000
'.AI the interest received from
these securities in 1922 by business
corporations estimated at S44S, 100000
was wholly tax-free under the existing
law. Banks and trust companies held
nearly $500, 100000 Of the securities
and received sS2S,OOo,OoO of the inter
est. Insurance companies owned over
$4,000, 100000 of tax-free interest in
1922. Had all this interest been tax
able at 1874 per cent (the tax rate for
corporations in 1929 the revenue
therefrom would have been about $44,
100000"
MELONS Half Truth.
OF course these corporation hold
ings do not come into the question of
surtax reduction. But even If they
did the total addition to the income
tax thru the taxation of securities
now exempt would be only about $780,
900, 900, or one-half of MELONS figure.
The commission shows that between
1912 and 1922 the aggregate debt of
the federal, state and local govern
ments increased six-fold to nearly
thirty-two billions. The major part Of
this increase was connected with war
profiteering, which increased the ma
tional debt from about a billion to
over twenty-five billions. The increase
from less than four billions to nearly
nine billions in the state and local
debts is shown to have been largely
on account of highway construction,
public health, transportation and edu-
cation. It is investment in such SOL
cially valuable enterprises that the |
bankers wish to discourage.