Evening star., 1934-05-20

eminent competition with industry, on
the one hand. and penalizing leglsla-
ton on the other.
Deterrent to Recovery.
Unless there is some assurance tnat
the profits of industry are not to De
totally absorbed by tax demands, there
will be no enlargement of an existing
industry nor the development OF
new industry. The, contention from
high circles for a redistribution OF
wealth through the form of taxation
is a deterrent to recovery. The de-
mand from like sources for the elm
ination of the element of profit from
investment on behalf OF business as
a philanthropy is a further deter
rent, Investment at best is a RISK
fraught with grave concern. II tne
Government policy dictates the elm
ination of profit on behalf OF pnllan-
thropy, then it must guarantee against
loss. else business is wiped out ana
revenue lost.
It is obvious that the investor VINO
Is under Government compulslon
through exacting taxation to conduct
his business on altruistic lines, oy
eliminating the element of profit, VIII
decline to make the effort. The COLI
slant threat on the part OF certain
influential factors of the adminlstra-
ton that. if the manager declines 70
embrace the expensive plans OF the
new deal which demand add.nonal
taxes, his business will be taken over
and run by the Government, comptls
him to stop, look and listen.
U. S. Must Continue Program.
This cumulation of adverse forces
antagonistic to a revival of business Is
all but a complete obstacle against
normal recovery through which en-
terprise must employ labor, and the
Government will be compelled to con-
tinue its ominous program, inaugu-
rated on Government expenditure, al
ready resulting in a shocking state
of the Treasury, which. If not matted:
will make the Government the chief
employer of labor, with all the fright
full consequences involved in political
management of industry.
This situation accounts for the ru-
NOR that a number of men with large
incomes have recently said that,
rather than see their earnings sWal-
lowed up by the Government in taxes.
they will take things easy. The danger
of this statement arises from the fact
that it is not so much a matter OF
choice as compulsion.
While the rumor will be criticized
by the element which is throttllng the
thrifty and Furnishing the frugal and
industrious in a desire to soak the
rich" the country is less interested
in a criticism of a practice than it
is in actual results compelled by Gov
ernment policies, as inevitable re-
suits are much more important to the
public than mere individual criticism
of the conduct of the taxpayer.
Incentive to Earn Removed.
The point is that if the Govern
ment proposes to impose virtually con-
fiscatory income taxes for all over
certain figure, all incentive to earn
above that figure is removed. In the
professions this may easily work out
in this way. Busy doctors and law
yers will be told they ought to take
longer vacations. to put themselves in
good shape They will be faced with
the fact that working during the pro-
posed vacation period would merely
be working for the Government. as
all the additional income would be
taken by the Government. If the tax
were only fair percentage of the
additional income, they might be will
ing to work for it. AS they have moth
ing personal to gain, they may easily
decide to take the vacation.
The situation is even more true
with respect to business men. con-
sidering whether they shall expand OF
not, or whether they shall take on q
new venture of some sort. In all such
expansions and new ventures there il
the element of risk. But if their in
comes are already fairly large, it be-
comes case of "heads the Govern.
ment wins and tails lose.' In other
words, the business man IN question
would be riskiDg a loss, but wuulc
have no chance to make profit
Common sense would dictate tht
answer. and the Treasury loses the
additional tax.
Copyright. 1894, by the North American
Newspaper Alliance 1ncD
HlnN ~ lIAnnn AHF