Evening star., 1936-08-30
Nothing Contradictory.

Senator Robinson accuses Governor
Landon of having made contradictory
statements in his Buffalo speech on
Federal fiscal policies. The nominee
of the Republican party" he said,
warned of the need for a balanced
budget, and in the next breath promised
to repeal a tax estimated to yield $780,
100000 annually" That. in the opinion
OF Senator Robinson, is contradictory.
Is it?
What Senator Robinson implied, of
course, is that under existing conditions
you cannot talk about budget balancing
and tax reduction at the same time.
That is probably true. and the fact
ought to be taken into consideration
by the administration, which is limiting
that If the American voters will be good
little boys and girls next November and
vote for President Roosevelt, they might
be rewarded by little judicious tax
reduction. Governor Landon, in this
respect. is much more consistent
Nowhere in his Buffalo speech did he
promise tax reduction. What he did
promise towork for was a more equitable
system Of taxation. And what he prom
ised specifically was repeal of the most
cock-eyed piece Of tax legislation ever
imposed in a modern country"
It is as a matter Of fact, more con-
Trajectory to speak Of budget balancing
by retention of such tax principles as
those written into the "cock-eyed" tax
on corporation surpluses than it is to
talk of budget balancing by repeal Of
such cock eyed" principles Of taxation.
Governor Landon's argument is con-
sistent, and for these reasons:
The corporation surplus tax, he
pointed out. has the practical effect Of
preventing corporation from using its
earnings in the business. 1T must pay
them out in dividends. In consequence
earnings no longer provide funds for
making needed Improvements, for re-
placing out-of date equipment and for
additions to plant" And that retards
the prospect of placing men In Jobs
with industry and increases the prospect
OF keeping them on the already over
burdened relief rolls.
Until men are taken of the relief rolls
and placed in private employment talk
of budget balancing is idle talk indeed.
The relief machine feeds on itself. The
more money poured into 1t, the more
money it demands. The only hope Of
ridding ourselves as q Nation of the
Old Man of the Sea Of relief Is the hope
of revival of industry that will supply
jobs and more jobs. And how has the
Democratic administration sought to
bring that to pass? For one thing by
the enactment of the 'cock-eyed" cor
poration surplus tax, that furnishes, 1t
is true, some additional revenue for
maintaining the swollen relief rolls, but
does so by punitive tax on the money
that should be used for supplying men
with Jobs in private industry.
The New York Times notes that Cen
eral Motors and the Packard Motor Car
Company are to invest between them q
total Of $lo,675 900 in new plants within
short time, furnishing additional en-
ployment for thousands Of men in con-
struction and, later, in permanent Jobs
Other industries are planning extensions
and improvements. But the money that
would ordinarily be available for such
extensions, unless borrowed or through
the sale Of additional stock or bonds,
will come out of the surplus on which
the Government now places q punitive
tax, designed to drive it away from
plant investment and into distribution
as dividends. Regardless Of the theory
behind this tax. that is the practical
effect as seen by business men and by
surprisingly large proportion of the press,
including those newspapers distinctly
friendly to the New Deal.
The real contradiction is in this tax
principle. That is where the inconsist-
ency Of the Administrations soak the
rich" theories of taxation lies. And that
is why Governor Landons promise, If
elected, to repeal vicious principle Of
taxation has brought widespread ia
vorable comment.