Evening star., 1933-01-23
|SALES TAX 4CRUEL," !"
B0RAH DECLARES
Senator, AssaiIing Presi.
dents Stand, Says Currency
Issue Comes First.
By the Associated Press.


President Hoover's advocacy of the
sales tax is "cruel proposal" and the
budget never will be balanced except
on paper until we settle the currency
proposal" Senator Borah, Republican,
of Idaho, declared yesterday.
Borah declared lit is going to be diff
ficult-and I believe impossible
it balanced, until you balance the
budget Of the taxpayers"
rs there any way" he said, "to
bring about the latter until you devise
a plan for increasing the prices of COM
modlties? Is there any way to do that
except through relation through an
adjustment of the money problem?"
The question of balancing the
budget is again being urged" Borah
said. Il venture the opinion that the
budget will not, and cannot, be
balanced except on paper, and that
prlery, either now or under the in
coming administration, until we settle
the currency question. 1t cannot be
done any more than you can build
a mouse upon receding sandbar.
Paper Balance Alone Possible.
With commodity prices near the
bottom and still slowly falling, with the
purchasing power of the masses near
the minimum and still diminishing,
with taxes increasing in amount but
diminishing in returns, with the value
OF the dollar depreciating and mort
cages and taxes responding accord
lngly, there is no such thing as
balancing the budget except on paper
and temporarily.
The proposal has been made to
cut Government expenses $500, 900, 900.
proposed to raise $500, 900, 900 by in
crease OF taxes, the sales tax That is
a cruel proposal in the light of dimin-
lshing profits, falling prices and de-
crease OF purchasing power. At a time
when underconsumption is q malady
which menaces our whole social struc-
ture, there can be no justification for
aggravating the malady
II we cannot stabilize prices, to lay
on a sales tax which strikes at those
least able to pay is to accentuate the
fall in prices and discourage and de-
crease purchasing power. We are
travelling in a vicious circle toward
economic collapse
about $85 ,2O6, 900 900; in 1882. about
$37 500, 900, 900. Our national income
now Is about equal to the taxes of the
people, city, State and national, to-
gether with the interest falling due on
private Indebtedness. We have already
reached the point when, measured
against interest and taxes, the income
OF the Nation is about zero.
Losing Foreign and Home Markets.
ITO put tax on the poorer people
until we have done something to raise
and stabilize the prices of commodities
Is not wise from an economic stand
point, and socially, it is an iniquity.
AT the present time we are on the
gold standard in this country. The
rest of the world, except France. which,
owing to certain reasons not necessary
to discuss here does not affect greatly
our situation, is on managed cur
rency basis. While our dollar climbs
in value, their currency is accommo-
dated to their economic situation. The
result Is that we are not only losing
our foreign markets, but we are losing
our domestic markets.
Important lines of business are &C.
tually being closed because they can
not compete in the markets with the
products coming in and deluging our
home markets from countries on
cheaper currency basis.
"The fish business on the Pacific
Coast is being literally ruined. The
countries of the gold standard are lit
orally taking over the fish industry.
THE farmer also is feeling the effect
Of the competition in the same way.
Other important lines Of industry feel
the effect of 1t.
Inviting Further Distress.
ITO talk about balancing the budget
and laying on heavier taxes without
any accompanying program to meet
this situation is to invite further de-
preston. further distress, If not some
thing worse.
1T is going to be dificult-and I
believe impoSsible-to balance the
budget, certainly to keep it balanced,
until you balance the budget of the
taxpayers. Is there any way to bring
about the latter until you devise a plan
for increasing the prices of commodi-
ties? Is there any way to do that ex-
cept through relation, through adjust
ment Of the money problem?"
President Hoover, in q special mes
sage to Congress last Tuesday, recon-
mended a general sales tax blanketing
all commodities except food and cheap
clothing. He said this was the best
available means of balancing the
budget.