The midland journal. (Rising Sun, Md.) 1885-1947, 1935-05-17
IMPENDING STRIFE OVER PRO-
CESSING TAX

Inc average CltlZeH has vague
knowledge of the fact that the Fed
eral government is levying processing
taxes ON farm commodities in order
to produce the wherewithal for pur-
suing the Agricultural Adjustment
program. What he dosent know Is
that these taxes are now one OF the
largest revenue producers the gov
eminent has-and that bitter war
is slowly getting underway between
the friends and opponents of the tax.
During the past 81 months, income
taxes brought $3.50, 100000 into the
Federal till. Processing taxes
brought in 100000. And,
whether the tax is good or evil, it is
IN undenied fact that every cent OF
chat three-quarter billion came from
the pocketbooks of American house
wives. In theory, of course, the tax
falls upon the food middlemen of the
lation-the producers of smoked
meat, the handlers of sugar, The
bakers, the cigarette manufacturers.
In actual practice, the cost of the
tax is simply added to the selling
price of the product. Example: On
April /, 1888, Mrs. America paid, on
the average, GA cents for pound
loaf of bread. In 1894, she paid 10
cents and today she is paying S.3
cents. Not all of the increases can
be laid to the processing tax on
wheat, but substantial part of it
can.
Two hundred million dollars of the
1892, 100000 the processing tax has
raised, according to the U. S. News,
came from hogs. Two hundred mil
lion more came from cotton. A lit
tie less came from wheat. The re-
mainder came from sugar, corn. to-
Dacco, rice and peanuts.
Of the 100000, $700,000,-
900 has been paid to the farmer. 1t
is paid to him in fulfillment of a
contract, not to produce more or bet
ter food, but to produce less. He
gets so much an acre for not produc-
ing cotton, so much for not raising
hogs. And therein lies one Of the
grounds for the battle that is getting
underway A great many people
think it not only unwise, but actual
ly criminal, for the government to
pay out good money to "bribe" pro-
lucers to cut down their production.
This group is now engaging with the
group which says that non-produc-
ion is essential in order to raise the
prices of farm products to profit
able level
That debate is largely theoretical.
But there is much warfare to be an
,icipated over purely practical issues.
For instance, in the past much of the
American cotton production has gone
into export trade. But, as process
ing taxes are added to the cost of
cotton, prices must rise, and foreign
buyers don't like that. Production
abroad is stepped up, as other ma
lions seek sources of cheaper cotton.
The result is that farmers find that,
while prices are better, they are UNI
able to sell-and they begin to doubt
the wisdom of the tax.
Housewives discover that the tax
forces up the price of bread and pork
chops, amounts to sales tax on the
basic necessity of life, food. The re-
suit of that is gathering of con-
sumers, bent on eliminating the tax.
Even hog farmers, who are gener-
est benefciaries of the tax, are dubi-
ous. They think that pork process
sors are cutting down the price they
pay for livestock in order to compen-
safe for the tax, and SO are taking 1t
out of the farmer instead of the con-
sumner and middleman.
All of this is felt back in Wash
ington, where Senators and Repre-
sentatives keep their ears to the
ground. Result is growing feeling
on the part of many congressman
that the tax should be repealed.
Some of them are beginning to talk
about it-others will line up behind
lhem when the future of the tax
comes up for Congressional consid-
GRAFTON.