Evening star., 1937-05-25
The EVENING STAR. WASHINGTON, G,
insurance case) has set the doubt At

insurance case) has set the doubt at
rest.
"But the Ill is all one, or at least
not greatly different whether men ar.
thrown out OF work because there Il
no longer work to do or because the
liabilities Of age make them incapable
OF doing 1t. Rescue becomes neces.
sary irrespective Of the cause. The
hope behind this statute Is to save
men and women from the rigors of the
poor house as well as from the haunt.
Ing fear that such lot awaits them
when journeys end Is near"
Careful Investigation Cited.
Justice Cardozo then said that Con.
gress did not "improvise judg.
ment" when 1t found that the aware
Of old-age benefits would be con.
ducive to the general welfare, but
reached this conclusion only after 3
careful investigation of the facts
After reviewing the facts unearthed by
this investigation the opinion stated
THE problem is plainly national ir
area and dimensions"
He also added that the laws Of the
separate States cannot deal with tn.
problem effectively and concluded thai
the tax on employers is a valid excis.
or duty upon the relation OF employ.
ment, and that 1t is not invalid be.
cause some classes OF workers, suct
as domestic and farm employees, are
exempted.
In his dissenting opinion Justic.
McReynolds said:
In upholding the State jobless in.
surance law, the court passed on TIVE
cases which came up from Alabama
as the result Of injunctions to re.
strain collection Of the tax, grantee
by a three Judge Federal Court a
the behest of the Southern Coal 4
Coke Co. and the Gulf States Pape,
Corp.
State courts have held these act.
constitutional
In the majority opinion Justic,
Stone said that I'VE see no reason t.
doubt that the present statute is a,
exertion Of the taxing power OF tn,
State"
Taxes, which are but the mean
OF distributing the burden OF the cos
OF Government, are commonly levied
on property or its use. but they ma,
likewise be laid on the exercise o
personal rights and privileges" h.
| said.
Discrimination Charxed,
The State Of Alabama took the cas-,
into the Supreme Court, taking u,
the contention Of the two appellen
companies that the tax, which, i,
Alabama. Is borne both by employe
and employe. is discriminatory ant
violates the due process power clause
Justice Butler said that ut is inher.
ent IN the exercise Of the power to ia,
that State be free to select tn,
subject OF taxation and to grant ex
ceptions."
This court" the opinion said, "ha
repeatedly held that inequalities which
result from singing out Of on.
particular class for taxation or ex
emption, infringe no constitutions
limitation" 1t added that "a legis
lature Is not bound to tax every mem
per OF class or none. It may max,
distinctions Of degree, having a ra
tlonal basis. and when subjected t.
Judicial scrutiny, they must be pre-
sumed to rest on that basis II there /
any conceivable state OF facts whicl
would support it,
The Alabama statute applies onl
to employers with eight or more EN-
ployes. The companies fighting tn
law had been sustained by the lowe
courts in their contention that ther
was no reason for a distinction TO
purposes Of taxation between thos
who have only seven employees, an
those who have eight.
Twilight Zone Decision.
Answering this, however, the ma
)orlty opinion said, Yet this is tn
type OF distinction which the law
often called upon to make" It adde,
whether it (the State) should dray
the line at one, three, or seven /
peculiarly a question for Legislative
decision. The decision cannot be sal,
to be arbitrary because it falls in tn
twilight zone between those member
OF the class which plainly can an,
those which plainly cannot expedi
tiously be taxed"
In dissent concurred in by Jus
tioes Van Devanter and Butler, Justic
Sutherland did not dispute the valid
| itV of nemDlOvnept copopaosot;a,
statutes, per Sc, but took exception
only to the form OF the Alabam
statute. Justice McReynolds also dis
sented, but filed no opinion.
In his opinion, Justice Butler, rails
ing the question of constitutionalit
under the tenth amendment, said:
The Constitution grants to tn
United States no power to pay unem
ployed persons or to require the State
to enact laws or to raise or disburs
money for that purpose. The pro
visions in question, if not amountin
to coercion in legal sense, are mani
testify designed and intended directl
10 affect State action in respects spec
flied. And, If valid as so employed
this tax and credit device may b
made effective to enable Federal au
thor1ties to induce, If not, indeed, +
compel, State enactments for an
purpose within the realm of Stat
power and generally to control Stat
administration of State laws"