, 1924-12-18
COMMON SENSE OF TAXATION

In repeating his recommendation for a reduction of the
higher surtax rates, Secretary of the Treasury Mellon is forti-
fed by the tremendous majority of votes poled for the Re
publican candidates who had endorsed the Mellon recommended
tons. But whether he had been fortified by that majority or
not it is safe to say that Mr.. Mellon would have renewed his
advice. Confident of the soundness of his policy and having
the courage of his convictions, an apparent setback at the
polls would not have scared a man who has devoted himself
so earnestly to the public welfare and undoubtedly has an am
bition to see his views ultimately justified. 1t is fortunate that
he was not forced to face an apparent d%isapproval by the cit
Gems of the country, but has a hearty endorsement instead.
1t does not seem likely that there will be any reduction
in the high surtax rates at this session of Congress, and, in
deed, it is the desire of the administration to wait and see how
the present rates work before making a further revision of
income taxes. But there is much to be gained, however, by
repetition of the recommendations, for there is need for educa-
ton of the public on a subject concerning which there has
been much Misrepresentation. In these days when the Ameri-
can people have so many things to think of-crime waves, traf-
fio congestion, movie sensations, sport championships, housing
problems and local politics, to say nothing of crossword puz-
zaes, it takes a lot of repetition to impress the public with the
facts concerning a serious national fiscal policy. President
Coolidge recognized this when he said in his recent message
to congress-:
"The fallacy of the claim that the costs of government
are borne by the rich and those who make a direct contribution
to the national treasury cannot be too often exposed. No sys-
tenn has been devised, I do not think any system could be de-
vised, under which any person living in this country could
escape being affected by the cost Of our government. 1t has
a direct effect upon both the rate and the purchasing power
of wages. 1t is felt in the price of those prime necessities of
existence, food, clothing, fuel and shelter. 1t would appear to
he elementary that the more the Government expends the more
it must require every producer to contribute out of his pro-
duction to the public treasury, and the less he will have for.
his own benefit"
1t is true, as the President SO well said, that the principle
stated by him is elementary, but, nevertheless, it must be fire.
Quentiy stated in order to overcome that far too prevalent no
ton that part of the people can escape taxation by enacting a
aaw which on the face of it puts the tax burden on others. In
the end the burden will be pretty evenly distributed, but the
process of distribution is so indirect and so complicated that
many people may not observe it.
1t may be added, moreover, that ''taxing the rich" hits the
man of moderate means in two ways-it adds to his cost of
living, and, by discouraging men of enterprise, tends to limit
industrial activity, and, therefore, limit the income of the work
ing man. The only way to reduce the burden of taxation on
the people of the country is to reduce or repeal a tax. At
tempts at tax shifting are as futile as using black ink instead
Of red to record a deficit in your annual business.