Evening star., 1935-09-21
.U.S .S.EXPEND|TURES
AND TAXES TO Be
.PROBED BY c. Of c.
Directors of U. S. Body Also
Authorize Poll of Members
on Legislative Trends.
NEW DEAL LAWS HELD
RETARDING RECOVERY
Business Confidence Gains Due to
Feeling Court Will Throw Out
Laws, Says Strawn.
BY tn; Associated Press.

BY tn; Associated Press.
After a leader in the Chamber of
Commerce of the United States had
called parts of the new S250000,000
tax law discriminatory and inequi-
table," the directors of the organiza-
ton announced today they had
ordered a study of "the whole field
of Federal taxation and expenditures.
This announcement came after the
directors, concluding a one-day seS-
sion late yesterday, had authorized a
Nationwide poll of the chamber mem
bership on a report sharply criticizing
the trend" of New Deal legislation.
The criticism of the tax law was
made in a statement submitted to
the directors by Fred H. Clausen of
Horizon, Wis. chat man of the cham
bers Committee on Federal Finance.
The statement, made public by the
chamber today, said the time has come
for a general review of the Federal
tax system with a view to eliminating
present 'inequitable" provisions.
The Clausen statement also said
adverse effects on business enter
prises of national policies which re-
sist rather than promote employment
in private industry"
Order Tax Survey.
The directors ordered the chamber
Federal Taxation Committee TO pre-
pare report on taxation and eX-
penditures and submit it to a vote
of the members.
Clausen's statement raised several
objections to the tax law, which pro-
vides for new or higher levies Oh
estates, incomes over $4,000. gifts.
corporation income, excess profits, in
tercorporate dividends, capital stock
and personal holding companies.
In discussing the tax law and the
procedure leading to its enactment,
he listed these points:
81. Violation of the fundamental
principle that the primary purpose OF
taxation is to raise revenue for the
legitimate expenditures of the Govern
ment. Recent tax proposals have
been avowedly for the purpose of ac-
complishing wide-reaching social and
economic reforms.
- Failure to bring forth an ade-
quate tax program that would combine
reduction in public expenditures. a
balanced budget and the imposition OF
new taxes in a manner that would
least retar4, business recovery.
"3 Hasty and inadequate considera-
ton without sufficient prior notice to
the country of administrative inten-
tions
"A Disregard of the prerogatives
and rights of the States for raising
neceSsar, revenue.
IS. Proposals based on the principle
that growth of industry to large size
is inherently contrary to the well-be-
ing of the nation.
"6. Taxation at such excessive rates
that going concerns would be dis
rupted without suggesting to business
any substitute for the methods which
are now employed
Report Based on Legislation.
The report on which the Chambers
membership will be polled was pre-
pared by special committee headed
by John w. OLeary of Chicago. Based
on study of legislation enacted in
| the last three sessions of Congress it
listed these trends:
There is a steady endeavor to re-
| place with Federal jurisdiction the
| jurisdiction of the States over matters
| heretofore considered as belonging
solely in the field of State and local
government;
Exercise of the spending power
without regard to revenues, for pur-
poses within the powers of neither
Federal nor State governments, and
on a scale that brings to every busi-
ness and to every individual the dan
| gers flowing from a continuing unbal-
anced budget;
Extension of competition by Gov
ernment enterprise into the field of
private endeavor for the purpose of
regulating private enterprise or other
wise:
Regulation by the Federal Gov
ernment of all forms of production. in
duStrial and agricultural, and all mar
keting and retailing-with the Fed
eral Government infringing on the
individual in his everyday affairs in
making living-in planting crops, in
working at trade for himself, or in
working as an employe of another;
Delegation of powers to the execu-
| tive department of the Federal Gov
ernment and constantly enlarging ad-
ministrative agencies and bureaucracy
for detailed applications of measures,
with all decisions for the whole coun-
try at central point and consequent
delays and expense for citizens even
as to matters in themselves of small
Importance"
Spokesman for the chamber said
ballots will be sent out Immediately
containing both the report and argu-
ments against its approval prepared
(See @. OF c., Page 81