The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1935-11-07
States
Rights

be developed in any
States community where
Ri1bfs there were more
than a handful Of
Democrats If one took the position
that the rights of the federal gov
eminent were predominant over states
rights. States rights constituted an
issue that never died politically until
the New Deal arrived on the scene
at Washington. Through some two
years or more now, we had heard
very little about states rights. Yet,
within the last few days, we have
found that the states rights issue was
not dead. 1t was only sleeping, and
1t has come to life in a really big
way.
New Deal policies have been con-
sistently policies of Capitalization of
power in the hands of the federal
government. New Dealers have enact
ed much legislation and have carried
out many programs that appear to be
contrary to the views which used to
be held by advocates of states rights.
These things have been accomplished
with almost no complaint from the
Democratic side and with only min
imum of squawking from New Deal OPP
position from whence came complaints
about RECOMMENDATION and extension of
government functions into the field of
private enterprise in competition with
the governments citizens.
Lately, however, some thirty or thir
ty-five cities have awakened with
shock and have rendered one New
Deal program severe jolt by that
awakening. I refer to the plans for
government construction of the So
called low cost housing projects.
These were and are intended to pro-
vide apartments or small homes for
families in the very low income brack-
cts and to provide work for labor in
their construction. Eventually, it was
hoped, the program would use up
good many hundred million dollars of
work-relief funds. Some has already
been spent; some projects have been
completed, and these results coincid-
ed with the arrival of tax paying time
In certain localities. That was the
erux.
To show what has happened in those
cities and areas wherein the low cost
housing projects
Atlanta have been planned
Project or completed, let us
take particular
case, namely, the, housing project in
Atlanta. Georgia. 1t is of no use to
cite the facts in all of them, because
the Atlanta case is typical
Secretary Ickes and his Public
Works administration had spent ap-
proximately three million dollars in
the construction of the Atlanta hous-
ing layout. No sooner had this been
accomplished, however, than the city
of Atlanta awakened to the fact that
1t would get no taxes nor will the
state of Georgia get taxes from this
great investment. The project was
ruled by Comptroller General ]. r.
McCarl to be federally owned. AS
such, it was not subject to state or
municipal taxation. The city of At
lanta and the state of Georgia had
been deriving taxes from the real es-
tate now owned by Uncle Sam.
1t was Atlanta's turn to move. 1t
announced through its properly con-
stituted city authorities that If there
were no taxes, then Atlanta could not
furnish fire and police protection for
the property nor could it supply water
for the tenants nor would it permit
children of those tenants to attend the
Atlanta schools as free students. At
lanta contended that it bears the bur-
den of these expenses and it was not
going to add to that burden without
reimbursement.
Secretary Ickes sought then to off
set the Atlanta ultimatum by tender
ing funds. taxpayers money, to the
city of Atlanta equal to the amount
he thought the city would receive in
taxes. Again, Mr.. McCarl stepped in.
He said that since the property was
owned by the federal government it
was not subject to taxes and therefore
payment to the city Of Atlanta out
of federal funds constituted a gratui-
ty. In other words, it was an illegal
proposition.
The comptroller generals ruling
was so definite and positive that those
who have been boosting and Boosting
about low cost housing projects have
been stunned. Frankly, they do not
know which way to turn. Thus far,
they have not discovered ray of light
to lead them. The housing projects
are held in allegiance.
The housing project situation brings
to the fore a condition which apparent
ly had not been gen.
Enter orally recognized. 1t
TQrdfion relates, of course to
the general subject
of taxation but it has a bearing upon
many policies now operative and
which, it is fair to say, have been
described by President Roosevelt as
experimental. Since they are expert
mental, it seems to me they ought to
be examined from this taxation phase.
One can understand readily the base
of the objection. There is hardly a
city or town or even any other kind
Of taxing district in the United States
where the tax rates are not at the
very peak which the people can carry.
That was shown most wildly a year
ago when Congress thought it neces-
sary to enact legislation permitting