The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1937-01-21
IRON TAXES
(St. Paul Pioneer Press

Governor Benson has proposed
changes in the laws which tax the iron
industry that would increase the
amount of taxation paid by the mining
companies by not less than 20 million
dollars year, and probably much more.
The drastic character of these pro-
posals is made evident by the fact that
in recent years this industry has been
paying from 16 to % millions in taxes.
The wisdom or unwisdom of the par
ticular methods suggested by the gov
ernor may be disregarded, except to
take notice of the fact that the legal
and technical objections to much of
the program are formidable. The
larger question is one of policy. The
underlying assumption appears to be
that Minnesota has practically a mon
opoly in its rich deposits of iron ore,
and that the state should make the
most of this monopoly while it lasts.
If Minnesota were to adopt any such
program on the assumption this state
would be repeating a disastrous error
that has been made by others Penn
sylvania, for example, thought it had
a monopoly on anthracite coal and tried
to levy against hard coal users of the
country; this policy was partly respon-
Sible for the substitution of other fuels
for hard coal which has ruined the
anthracite industry and left thousands
of miners stranded and permanently
unemployed population.
Minnesota has the great advantage
over other sources of iron ore in that
the range here is a going concern"
The vast machinery of mining and
transportation on quantity production
basis is in existence in Minnesota and
not in existence in other potentially
competitive places. But once let pro-
ductive industry be established, for
example, in Brazil, and the Minnesota
industry would be permanently ruined.
Incidentally, Brazil itself once thought
it had hard and fast monopoly over
another raw material, with the result
that the world buys its rubber in the
East Indies.
Minnesota will be the chief source of
this country's iron ore only while it is
cheaper to get the ore here than else
where and no longer The Alabama de-
posts are already considerable factor
and those of Michigan are an in
creasingly competitive threat. Unfor-
tunately Minnesota does not have an
unbreakable monopoly but only a GER
tain temporary advantage which it
should be the part of craftsmanship to
guard and not to destroy.
At a time when all other business is
facing higher taxation, the iron mines
cannot expect to be overlooked, even
though they are already more heavily
taxed than any other industry in the
state. But this must be done with
reason, careful study of the factors and
foresight.
One fault with the iron taxation in
Minnesota Is that too great a share of
the iron revenues is going to the local
communities, not enough to the state
government. About rs per cent of these
revenues is going to the range towns
and villages, giving them resources so
far beyond any needs of local govern
ment as to lead to the fantastic ex-
cesses of municipal extravaganza which
have made the range a national by
word. In the meantime the state gov
eminent, with its large expenditures for
school aid and social welfare of which
part goes into those same communities,
gets only % per cent. It is a condition
Of feast in one branch of government
and starvation in another. A better
distribution of tax receipts from iron
would lead to more healthy govern
mental condition all around.