Evening star., 1932-03-08
INCOME |NEQU|T|ES
BLAMED IN SLUMP
Shipstead, Speaking in Fo-
rum, Says Prosperity De-
pends on Wages for Masses.

| Public and private policies pursued
| in this country brought on the de-
! preston and are responsible for the
! depletion of Government finances, Sem
| ator ShipStead. Farm-Labor. of Min
nesota, declared last night in a speech
| in the National Radio Forum, arranged
by The Star and broadcast over the
coast-to-coast hook-up of the National
Broadcasting Co.
Primarily, tie situation was aScribed
to "a very unjust distribution of ma
tional income" by the speaker. who
added that between 1924 and 1880 I'VE
permitted industry to receive so much
of the national income at the expense
of agriculture and labor, that by de-
stroying their purchasing power indus
try's income has also to a large extent
been destroyed"
From the standpoint of the farmer,
the Senator said, high freight rates,
tariff inequalities, high interest rates
and the unstable value Of the dollar
have worked adversely. Overcapitaliza
ton of industry also has affected a
great mass of the people, he said.
New Corporation Laws Urged.
"The need for new laws relating to
corporations doing business in industry
anu lOl COllllOl vi blIC
corporation, at least so far as capital
issues and consultations are con-
cerned, by the Government, is urgent" "
Senator Shipstead asserted.
Discussing measures for balancing
the budget. Senator Shipstead took up
the question of reducing Government
expenditures, holding that it is difficult
to make any material cut, because rs
per cent of such expenditures are fixed
charges due to war land must be paid" :"
This is something the people should
think of before We go to war" he
warned.
The speaker scored the proposal for
sales tax. describing it as another
attack on the income of the great mass
of the people whose income already
is reduced
Buying Power Needed.
"The safety of the banks, the pros
perity of the railroads and corpora
tions depends, in the last analysis, upon
tn, prosperity and purchasing power
of the 70 mill on people on the farms
and working for wages" Senator Ship
stead concluded. Until they are pros
porous. industry, transportation and
commerce cannot be prosperous. Com
pei corporations, by taxation, to dis
tribute their exorbitant earnings in the
form of wages to create purchasing
power to buy the products OF INDUSTRY
and thus increase prosperity.
The text of Senator Shipstead's
speech follows
1.-THE United States Treasury, 1t IS
predicted. will be short in the neighbor-
hood of 81 900 600 900 at the end OF June
30, 1882. For long period OF years up
until 1880 the Government Treasury
had a surplus of income over eXpenol-
tlIres. The question is naturally raised
as to why this great deficit came SO
suddenly within the last two years:
I'VE must remember that the Treas
ury of the United States does not make
money. 1t collects money IN the form
of taxes from the people. The main
source of income to the Feceral Gov
ernment cores in the form OF income
taxes and duties on imports. When the
great mass of people have incomes suffi-
ciently large so that they pay income
taxes to the Government, and When
foreign commerce in the form of i'm
ports is proSpering, revenues TO the
Treasury increase. When the great
mass of the income tax paying ndl-
viduals and corporations are prosperous
income tax receipts increase. When
foreign and domestic commerce is pros
porous, there Is always SuIHclenI reFe-
nue. to fill the Treasury, and when these
activities are not prosperous Govern
ment income declines. The main rea-
son for the lack of income to the Treas
ury is the fact that incomes OF Ameri-
can citizens and corporations and for
eign commerce have suffered great
eecline in the last two years. Generally
speaking, it may be said that the Gov
ernment has lost its income because
the American people have lost their
income. If we can come to an under
standing of how the American people
have had their incomes reduced, we
will then know why the Government
income has been reduced.
"I will this evening give you some OF
my views as to why I believe these
incomes have declined. After having
done so, I will, with your indulgence,
give you some views that have as to
how incomes, both to the American
people in general and the Government,
can be restored.
Il believe the American people, and
therefore the Government, income has
declined because we have pursued poll
cies, public and private, that have de-
stroyed incomes. These policies have
brought on what we call the depression
In this Commute address there is not