Evening star., 1937-01-10
Other States and Canada.
Member Of the Associated Press.
The Fiscal Report.

laid down by the fiscal relations report
make certain that both premises and
conclusions will be subjected to that mi
croscopic examination which will reveal
the full extent of the flaws in reason
ing now threatening the District with
paralysis of development and financial
burdens nothing less than disastrous in
their effect. Especially is this true of the
conclusions tending to show the under
taxation of Washington; conclusions pro-
duced by theoretical yardstick hitherto
unapplied in such measurement.
To be complete, however, that exam
ination requires time. The report is not
only long, it Is confusing in its arrange
ment. Departing, as Senator Glass and
Senator Thomas have noted, far from it's
original mission, the report has presented
a mass of novel proposals and legislative
recommendations bewildering in their
complexity and detail when examined
against actual conditions in the District.
The nature of the formula and the
effect of its application are more appar-
ent. The nature of the formula is to
place all except incidental financial
responsibility for maintenance of the
American Capital with the local tax
payers, leaving the important financial
control and power where it now rests
with Congress. The formal gesture of
the report in the direction of some vague
form Of "local suffrage" does not alter
that condition one whit. The power is
not transferred to the local taxpayers.
The power is retained in Congress. 1t is
the responsibility which goes to the local
taxpayer.
The immediate effect of the formulas
application is obvious. The local tax
burden must be increased by third to
balance budget sent to Congress by the
Budget Bureau and translated into an
appropriation act by Congress. The esti-
mates contain no substantial increases in
funds for maintenance or development
OF the services paid for by the unrepre-
sented taxpayer, despite the very drastic
increase in local taxation. None will be
available without additional, drastic in
creaSes in taxation.
The nature of the formula is to scrap
the traditional conception OF joint re-
sponsibility between the local community
and the Nation in the upkeep of the
Capital. The formula contemplates no
recognition - under normal circum-
stances-of any obligation by the Nation
in support of the Capital which it
governs exclusively. To speak of the
lump sum having been reduced" to
$2,533,357 is erroneous. The lump sum
has been abolished. There is no fixed
or any other recognition of a continu-
ing national obligation toward ordinary
maintenance of the Capital. The funds
for maintenance received by the District
from the National Government represent
payment for services" their value de-
pending on somebody's estimate.
Sound economic policy demands that
obligation be coupled with power, that
those who do the controlling must be
primarily responsible for the paying. The
practical effect of the conclusions of the
report is to continue the Nations despotic
power of control and practically to relieve
it of all obligation to pay
Substituted for the traditional concep-
ton of a continuing obligation of the
National Government in support of it's
Capital are three theories which compose
the formula.
The first involves a unique conception
Of the municipal government as sep
arate entity, performing certain services
for and receiving the benefit of certain
services from the exclusively controlling
National Government-services for which
q monetary value is estimated. The con-
ception is subject to definite criticism,
which will be discussed later in these
columns. And the estimate of the value
OF the services-with certain exceptions
depends primarily upon opinion rather
than fact.
The second theory is that national
obligation in support of the Capital
arises when the local cost of government,
after certain deductions, exceeds the av-
erage cost Of government per capita Of a
group of cities. The use of such an
average as the dividing line between no
obligation and some obligation by the
National Government is, in the first
place, peculiarly contradictory to the as
pirations Of those who would make the
Capital the worlds most beautiful city.
# applied at all, there should be dis
eliminating selection of cities, for cities
vary in their thrift, in their efficiency
and IN their progressiveness. The pros
pect, under actual conditions, of any
Federal payment from this part of the
formula is small indeed.
The third theory injects into the
already confused tangle of agencies hav-
ing finger in the District pie new
agency-"the one responsible agency for
physical planning and development of
the Capital"-which will control the
capital outlay programs and divide their
cost between the District and the Ma