Evening star., 1937-04-25
Prospects for Business
Men Here and Abroad
BY OVEN L. SCOTT,

sent query to washington few days
ago that reached leading Government
specialist on foreign economic affairs. He
wanted to know what line OF industry
In Italy or Germany would offer the best
opportunity for an American business
man with money to invest.
Neither Of those countries, this man
observed, was bothered by John L.
Lewis or by a Government that seemed
more interested In building labor unions
and figuring out new taxes than in en-
couraging business.
The official to whom this inquiry was
put suggested to the American business
fore taking any leap.
Admittedly, the official advised, an
employer within the United States faces
a growing number Of uncertainties. Labor
now enjoys special Government protec-
ton and may be expected to make in
creased demands both Of employers and
OF Government. President Roosevelt
seems unable to get control over Gov
ernment spending, with results that
can be serious. And It Is true that, In
Fascist countries, workers are forbidden
to strike and are kept in their place by
force II necessary.
But, this official emphasized, that is
only one side of the picture.
~ ~
The American business man, with dol
lars In his pocket, could expect to be re-
ceived in Germany or Italy like long
lost brother. But, formalities concluded,
he would begin a working acquaintance
with real government control Govern
ment would decide for him what he
could do with the money he had. 1t
would tell him what raw materials he
could acquire and the use to which those
raw materials could be put. Government
would dictate the wage scale to be paid
and the number Of workers to be allotted
to his enterprise.
II this business man did manage to get
his dollars to work where they produced
a profit the government would insist
that all Of that profit above 6 per cent
would need to 90 into short-term govern
ment bonds. with the actual cash to bo
used for armament.
All In all, an American seeking to
operate business in a Fascist country
could find the experience q bit CALLING.
But II he tired Of the enterprise. could
he withdraw? Not at all, according to
the explanation Of the Washington Of
flcial The most stringent projections
against fight Of capital are imposed,
with death penalty possible for vio-
lation.
Thus the price of controlled labor
can be considered high in those European
countries where that control is in ef-
feet. The price may be set even higher
when taking into account the fact that
the activity so attractive to the Middle
Westerner. who is viewing the situation
from a distance. really Is based on
feverish war preparation and would
probably collapse with any sound pros
pect for peace.
OF course, the official here pointed out,
the disgruntled American business man
could turn to England
That country is enjoying level Of
prosperity that is higher than the present
prosperity in the United States. There
are relatively few government restric-
tions as compared with Fascist countries.
But labor in England is highly organized.
even If disciplined, and this organized
labor has political party all its own.
The British have an old-fashioned
prejudice against trying to live forever
on borrowed money. They insist that
somebody must pay for the cost of gov
ernment, even If that cost is high.
So the Middle Western business man,
angered by the new Federal Government
surtax on the undistributed portion of
corporate income, would need not to be
too much Influenced by the growing
business boom now apparent in Eng
land. He might even find 1t relatively
easy to establish business that would
ut into the British armament picture.
But when taxpaying time came
around he doubtless would be foored.
How so? One glance at the British
taxes provides the answer.
&& X *
An American business man operating
in the United States through corpora
ton pays a tax ranging from 8 to IS
per cent, depending on the size of the
earnings. Then, on top of that, he pays
surtax ranging from 7 to q per cent
on the part Of those earnings not dis
tributed as dividends. His average tax
Is around Is per cent, but 1t might reach
% per cent if all earnings were kept in
the business
tax now Is to start at rs per cent Of
corporation income, and then there is
special tax on profits above 6 per
cent that ranges up to one-third Of the
remainder OF that income. Roughly,
corporation taxes in England are one
third higher than here
The business man could pay out more
OF the earnings In the form Of salary
to himself. But again he would be
caught. The British grant an exemption
from income tax Of about $500 for an
unmarried individual and $3.50 for
married man with no children. In this
country the exemption is $1,000 and
$2,500. After earned income deductions
the British tax will start at Is per cent.
where the American tax starts at
per cent.
A business man with q personal in
come Of $1,000, If married, with no chill
dren, would pay $50 in the United States
and $3.50 in Great Britain. If his earn
ings reached $4,000 he would pay $4l5
here and $1,785 in England.
And that is not ALL According to
information cleaned from studies by
the United States Treasury, the British
citizen pays tax Of about 13 cents a
gallon on gasoline, IA cents a package
on cigarettes and $3.18 per 500 of VAL
uation on his home. All of those taxes
are far lower in the United States.
The fact is that 100000 English
men, with a national income of $40. :
00oo0o,oo0, pay $4,250 0000, 900 to support
their national government, while l2o.-
100000 Americans, with national in