Milford chronicle., 1936-01-10

spuu5t 70 lue strong uLlelduceB O
the President following the Schech
ter decision, were inclined towari
greater caution.
Amendment Discussed
The question Of a Constitutions
Amendment was discussed on Mon
day at the first conference called by
the President after Supreme Courts
decision had come down. 1t was sait
that no conclusion had been reach.
ed Before deciding whether to Tisl
his future in advocating a COnsti'
tutiOnal Amendment, it was taken
for granted that the President
would await the second, and more
studied, reactions in Congress, OF
leaders of farm organizations, and
among the farmers themselves.
At the White House conference il
was decided that the Government
was morally bound to pay apprOxi-
mately $3.50, 100000 in benefits to
farmers to fulfill contracts already
made, and that an appropriation
for that purpose will be sought.
The full effects of Mondays de-
cisiOn on the Federal finances cam
not yet be determined. Since the
AAA went into effect in 1888, more
than one billion dollars in process
ing taxes have been paid and more
than 5000 100000 additional have
been impounded behind injunctions.
Recovery Of Taxes Doubtful
In the AAA amendments of last
summer, Congress prescribed that
a professor could not recover the
taxes he had paid unless he could
show that he had absorbed them
himself. This point is involved in
the Louisiana rice millers case, on
which the Supreme Court has heard
argument but has not yet ruled.
It was pointed out that Congress
presumably could protect the one
billion dollars in processing and
-four taxes already paid by denying
professors the right to sue for re-
cOVery. but the fate of the $780,
900, 900 in taxes which has been inn
pounded is a source of anxiety to
the Treasury,
In the first flush of reaction, AAA
officials spoke of the following pos
sible substitutes for their program:
A system of Federal subsidies
to State crop adjustment pro-
grams, although some lawyers
were doubtful that even this
would be legal under Mondays
decision, or that, if legal, it
would be effective.
Wholesale purchases of sub
marginal and marginal land.
A resort to the export deben-
ture or equalization fee plans,
or some modification of them,
Involving no attempt at crop
curtailment.
The majority opinion on Monday
held:
First, that the processing
taxes are a mere incident of an
act regulating agricultural pro-
ductiOn, and that therefore the
DrOcessOr-in this case, William
NJ. Butler and other receivers of
HOOsac Mills COrpOTatiOn-had
a standing to challenge the
legality of the tax.
Second, that by regulating
invaded the rights reserved to
the States. /
Third, that the crop control
program is in fact, cOeTcive but
that, even if voluntary, it would
be unconstitutional since "at
hest il is a scheme for purchas-
ing with Federal funds submis-
sion to Federal regulation of a
subject reserved to the States"
AS they found no power in Con-
gress to impose the processing taxes
In the first instance, the majority
held that the AAA amendments of
1885, designed to fOrtify the original
act, had no effect on the issues.
Welfare Clause Included
The majority opinion discussed
but avoided exact definition of the
general welfare clause of the Con-
stitution on which the Government
placed its chief reliance in the argu-
ment, and which the minority of
the court found sufficient ground
for uphOlding the act.
Both opinions, by statement or
implication, found that the original
AAA had contained an unconstitu-
tional delegation of power to the
Executive to fix processing taxes,
but that this defect had been cured
by Congressional ratification in the
of 1885. Both opinions
more or less specifically Outlawed
the Bankhead Cotton act, which is
now before the court in another
case.
The majority opinion accepted in
toto and embellished the main argu-
ment of former Senator George
Wharton Pepper, chief counsel for
The receivers of the HoOsac Mills
Justice Roberts said
hat if the AAA crop control pro-
gram were valid Congress could:
Subsidize shoe manufacturers
to reduce their output, using
funds obtained by a tax on all
retail shoe dealers or their GUS 7
toners.
Completely redistribute the !
Industrial population" by pay !
ing. out of excise taxes, bOun-
ties, to manufacturers who ,
agreed to move their plants to /;
smaller towns"
EsImDrObabIe" Few Years Ago =
Such cases, he said, we're mo J
more improbable than would the J
resent act have been deemed a few 2
ears ago" n
Until recently, he said, there had "
cen "no suggestion of the eXis-