Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-05-01
EASTERN STATES
CARRY TAX LOAD
Furnish Money for Those
That Have 0vertaxed Peo-
Ii pie and Resources.
8 This Is the nth OF series OF ar
ftctes on the trend toDdrd pdteTna,-
ism In the Federal Government.
BY AsHMUN BROWN.


GENERALIZATION of Government at Wash
ington and toward extreme paternalism:
Later there will be a discussion OF
the principles involved and of the meth
DDS which have been suggested for
betterment of the social order and Tor
the sterilization of economic conditions.
For the present, however, 1t is worth
while to dwell further on the subject
of the public revenues, the costs OF
government--national. State and local
and the drift toward making the ma
tional treasury bear an increasingly
larger burden of the total costs.
All public revenues come from the
people, necessarily, although it cannot
be said Their l,ear with exact equality
upon all. Nevertheless, taxes, whether
they are OF income or on capital or
on articles Purchased, like gasoline or
cigarettes; whether they are levied at
a customs house, at the oft1ce OF the
Federal commissioner OF internal rev.
enue. or at the county CT city treas
Irers Office, take just that much money
out of the pockets Of the individuals.
They reduce the spending and the IN
yesting free capital by just that amount.
The total costs of government, as
shown heretofore-national, State and
local--have grown from $29l9.000, 600
in 1918 to more than $4,000 600 600
this year, or $40 per cent while the
population has heen growing 1873 per
cent. Meanwhile. although the costs
of local government have multiplied,
they have fallen TO Sis per cent OF
the gross from tit per cent in 1918,
and the costs of the Federal Govern
ment have grown in the same time
from 1873 per cent of the gross to BAT
per cent and are still growing. That
is, the burden of government is being
ahifted in an increasing degree to the
shoulders of Uncle Sam.
The States plead that they have ex-
bausted their taxabls resources. In IL
Of them, now without this form OF
taxation, proposals tc establish State
INCOME tax are penJing this Spring
In the Legislatures. The State gaso-
line tax rises in various places and its
total earnings grow yearly to new al
titudes Various legislators propose that
the Federal authority, at the very time
it is called upon to furnish more and
more money for the States, should re-
linquish sources Of taxation to the State
authority.
Asked Change in Tobacco Tax.
In a speech in the House of Repre-
sentatives February q, Representative
william C. Landlord ~ Georgia, sug-
gested that the Federal Government
the tax assessed against manufactured
tobacco and leave these commodities to
be taxed by the State for local pur-
poses" He also asked that the States
receive authority to tax national banks
the same as State banks. The tax on
manufactured tobacco. 1t might be mem
toned, brought into the Federal Treas
ury last year more than 50,O00,000.
z. G. Griffin, State superintendent OF
public instruction of South Dakota, in
q letter filed with the Senate Committee
en- Education and Labor. suggests the
poverty Of the States and the necessity
for further aid. Advocating the enact
ment of a bill to give 100000, GOO a
year from the central Government 70
the States for the benefit of rural edu-
cation, Supt. Griffin writes. II the
school districts we're to levy sufficient
tax to maintain rural school OF aver
age standing term of eight months
1t would soon confiscate the land. -
He means, of course. If such a tax
were 10 be laid IN addition TO otner
taxes, and he probably is correct. Taxes
on farms in South Dakota are high, In
cident to the failure of the rural credits
law, the bank guarantee law end other
legislative adventures into which the
State government projected itself some
years ago. The State Rural Credits
Commission has had TO forecicse mort
cages on so many tens of thousands 81
acres of farm lands, taking them OF the
tax rolls, that the free farms have 70
bear an added load.
Nevertheless statistics published in
March by the National Industrial Con-
ference Board en- national wealth and
national income throw some doubt on
the theory that because the States nave
exhausted their taxation, resources they
cannot survive without further help
from Washington
These figures show that the national
wealth of the country at the end OF
1929 stood at 1851 300 900 600, an In
crease OF S3 per cent in Is years. The
average wealth per capita distributed
among the States, has grown to S2,92l:
1t Is curious fact that very many OF
the States which proclaim their dire
need of further subsidies from the Fed
eral Government have a figure of per
capita wealth much higher than the
average: much higher, indeed, than the
per capita figures for the so-called rich
Eastern States that furnish most OF the
Federal revenues.
Groups Of States Cited.
Consider this group of States. for ex-
ample, with the average per capita fig-
ure Of wealth set forth: wyoming.
$4,l19; North DeInta, $1,000: South
Dakota, S4,964; idaho, $4,ll9; Montana,
s4.755. Each. it will be observed, has
figure CT wealth far above the aver
age for the country.
The figure OF wealth represents tan
gible physical assets only, excludes
credits and securities. but specifically
includes land and structure and other
Improvements thereon, the equipment
OF industrial enterprises and farms, live
stock, railroad and public utilities land
and eQuipLIent. personal property. motor
and Other vehicles and gold and silver
coin and bullion-in brief, the major
local taxable resources.
Yet every one of these States. even
under the present limited system of
Federal subsidies. gets back from Wash
ington In subsidies each year more than
its people pay in internal revenue taxes.
For every dollar the people Of wyoming
paw into the Federal Treasury in taxes
the State gets back 1919. North Da-
kota gets back for each dollar $500,
South Dakota $l.93, Idaho $l.51 and
Montana $l.le.
New York, whence comes one-third
of all the Federal internal revenue
taxes, has a per capita figure OF wealth
of only $3.276 and gets back in sub
sides from the Federal Government less
than cent for every dollar its people
give to Uncle Sam.
These examples. Of course, do not
prove that the Western States, having
got themselves into financial hole. are
not In need OF money from some source
the Federal Treasury, for instance.
It does indicate, however, that an en-
largement of the Federal subsidy system
would not result in that more equitable
3 distribution of the burdens Of taxes that
is regarded as desirable.
Put another way, the Western States
mentioned nave q larger proportion OF
which to levy taxes for State and local
s,iirrnsnS than have the Eastern States