Evening star., 1935-07-08


Wants Fund Kept Separately.
"Some months ago, in discussing
monetary matters, I spoke of the
increment on gold resulting from re-
valuation as having been placed in a
special drawer tfrom the Treasury's
cash register. Hence it was being
kept separate from other funds and
was not to be used for ordinary ex-
penditures
"Silver seigniorage resulting from
the silver purchase act is being SIM
ilarly handled. y think it would
be the highest public interest to re-
gard the proceeds of these new taxes
as occupying third special drawer
in the Treasury, available only to
reduce our borrowing and later re-
duce the national debt"
Representative Crowther, Repub-
lican, of New York asked Morgenthau
If he thought the emergency was past.
II wouldn't say it is over, but the
worst of it is"
What I'm afraid Of" Knutson in
terposed, "is that this will be more
money for the Government to spend.
What is being done to balance the
budget?"
S3,000,00O, 1000 in Red Now.
'well," Morgenthau answered, 1--WE
have just finished the fiscal year with
the deficit considerably under the
estimate. I will say that we have a
good start"
What was the deficit?" Knutson
pursued.
Exclusive of the sinking fund, S3,-
100000, ,OO0." Morgenthau answered.
We'll, that is SO for every minute
since the dawn of the Christian era;
I don't think that is deserving of
much credit" Knutson said
Representative Woodruff, Republi-
can, of Michigan, then asked whether
the secretary did not feel he should
give to the committee figures showing
how much money should be raised
tc get this country on the road to
solvency."
I'VE must look to you and your de-
partment for the information" Wood
ruff said.
Figures Left to Congress.
"I think" Morgenthau answered
''that we have always given to your
committee the information it wanted.
But as far as I am concerned a de-
cision as to how much should be
raised will have to be made by Con-
gress"
Chairman Doughton brought smiles
when he remarked that the Treasury
had made no specific recommended
tions because it did not want Congress
labeled rubber stamp"
Representative Vinson. Democrat,
of Kentucky, pressed the same argu-
ment by contending that "tor the first
time in the history of this country the
President relies on this committee" to
decide how much revenue should be
raised.
100000 Incomes May Be Hit.
Although the new tax rates sug-
eested by the Ways and Means Tax
Subcommittee were withheld for the
moment, it was understood that some
rates contemplated increasing the
taxes on individual incomes as low as
100000 a year, and inheritances as
small as $50,0O0.
A new appeal to the White House
BY Congressmen seeking President
Roosevelt's guidance in determining
the specific rates he desires in the new
tax bill was forecast meanwhile In
congressional quarters.
In his statement to the committee
Morsenthau was careful to differenti-
ate between a recommendation and
an estimate He did not recommend
any particular program save that out
lined in general terms by President
Roosevelt in his tax message to Con-
gress.
The taxes suggested by the Presi-
dent, Morgenthau explained, "can be
made to yield substantial additions to
the receipts of the Federal Govern
Snent.'
Wants to Draw on Wealth.
"These proposed taxes rest on the
principle of ability to pay" he con-
tinued. "They are designed to draw
on accumulations of wealth and in
come which, for the most part, have
been derived from Nationwide &C
tivities.
I'm consequence, their enactment
should constitute an important step
forward in reshaping our tax struc-
ture along sounder and fairer lines"
The bill drafters planned further
conferences with the President. At
the last one he told them only that
he wanted a substantial amount" of
money. The choosing of rates was
left to Congress.
Ways and Means Committee Demo-
Gratis said privately they would let
the hearings continue reasonable"
time before going into executive ses-
sion to write a bill with rates and
exemptions in It, Then, when a ten
tative measure has been agreed upon.
1t will be laid before Mr.. Roosevelt for
his approval or disapproval before it
Is finally ratified by the committee.
Sharp Differences Exist.
Whatever the plan will be, there
remain sharp differences of opinion
among the committeeman. Chairman
Samuel B. Hill, Democrat, of WASH
ington, of the Tax Subcommittee, re-
calling that the President asked a
Substantial amount" said he would
consider anything between $35o,ooo-
600 and $5OO,OO0,00o a year as SUBJ
stantiaL
Some other leading Democrats con-
tended that s20O,o00,O00 or even less
would be substantial" enough If the
social aspects of the plan were en-
phasized sufficiently.
Most of the committee Republicans
were silent, pending study, but some
insisted that the bill should be broad
ened enough to meet the deficit, or at