Coulee City dispatch. [volume] (Coulee City, Wash.) 19??-19??, 1935-11-14

ing themselves virtually bankruptS
and according them the right of COM
promising with their bondholders I'M
der decree of United States court.
So, when we think of taking away tax
able property in any city and making
it non-taxable by conversion from pri-
vate to federal government owner
ship, we see how 1t adds further bur-
den of taxes to the remaining private
ly owned property. That is the reason
why many municipalities are fearful of
government ownership of railroads.
for example, since the railroads are
heavy taxpayers in every community
they serve. Laying aside the question
of merit or lack Of merit in the propo-
sition of government ownership OF
railroads. no municipality can afford to
overlook the loss of tax receipts that
would follow government acquisition
of those carrier properties. They pay
real estate taxes in the United States
annually of more than three hundred
million dollars. OF course it is dis
tributed in thousands Of places but
whatever the amount may be in your
community or any other, it represents
a tax source which the local govern
ment can i'll afford to lose.
1t is the same, although to lesser
degree, with respect to the housing
project. In this statement mean only
as to the local tax phase. 1t has,
however, another very important tax
angle. Property, or the income from
property, everywhere is subjected to
three tax assessments. First, the
county or city in which the property is
located takes tax toll; second the
state gets share, and thirdly, the
federal government either by income
or some other tax gets it's hand into
the pocket of property owner.
In the case of the low cost housing
project, it was necessary to calculate
the rental rate on base so low that
it would be impossible for the total
receipts to pay off the government in
vestment. This had to be done If the
low cost housing was to be supplied
at rate the poorer classes could
pay. 1t is seen, therefore, that there
was a deficit staring the project
in the face. To meet this deficit GER
tain federal funds were to be set aside
regularly which, coupled with the re-
to amortize the original cost. From
the standpoint of liquidating the cost
of the building, this is fine but it does
not impress one as being so whole
some when it is shown that the gov
ernment's contribution comes out Of the
general fund of the Treasury which in
turn comes out of the general taxpay-
ers of the nation.
And so it is with great many 9TH
err of the experiments where such pro-
grams place government-owned agen-
cies or industries in competition with
citizens. Take the Tennessee Valley
hydro-electric project for another ex-
ample. The federal government has
placed more than $131, 100000 in that
venture. The present Tennessee VAL
ley Corporation has taken over these
properties at about one third of this
amount-a net loss to the government.
But that is not all. The vast project
that has been developed in the Ten
nessee valley and through the adjoin-
ing counties and cities Is not subject
to state taxation nor do the cities that
are being served by Tennessee river
electricity get any taxes from this
source. 1t may be sound in the theory
but l am fearful that the inbred op.
position to federal government en-.
croachment on local affairs sooner or
later will cause a new explosion. 1t
will come from the original feeling
that states rights ought to be superior
to federal rights except where states
have delegated that authority to the
federal government in the national
Constitution.
Earlier In this discussion l men,
toned the ruling by Comptroller Cen
eral McCarl who act
AtUdyS ed, of course, as the
the Goat head of the general
accounting office.
This agency was created with very
definite purpose in mind. Congress
wanted some Independent group or
authority to watch all federal expend-
lures to make certain that they were
made in accordance with law. good
many years ago when this job was
done by the comptroller Of the treas
ury, it was not infrequent that an ad-
verse ruling by the comptroller put
the comptroller in tough spot.
Mr.. McCarl is not popular Private
ly and publicly, he has been criticized,
sometimes in language hardly print
able. These complaints always have
come from someone whose idea of
spending money was found by Mr.. Nc
Carl not to be in accordance with the
law. Always, he was the goat.
He has been the goat much more
under the New Deal than ever before.
Every time he kicks over New Deal
plan, the sponsors of that plan brand
him as Tory or Reactionary or as
being just plain dumb. He has en-.
gagged in controversy with none Of
them. He has contended that his de-
cisions were rendered in accordance
with the law which he was directed