The Western news. [volume] (Libby, Mont.) 1933-current, 1938-06-16

fact that many corporations, badly
hit in the 1929 situation, continued
to pay dividends through 1881 ana
some of them into 1881, though even
tually they were forced to dlscon-
tinue.
Incomes Reduced
Reduction of dividend and bond
coupon payments at the present
time hits the income tax returns 10
follow much harder than was the
case in 1929 and through to 1888.
At that time the Treasury did not
tax normal individual income rates
on dividends. 1t was assumed, up
until later tax bill, that the Brit
ish system. holding that the corpo-
ration income tax had covered the
normal individual income tax on
dividends, was fair.
There is another important point
to be remembered in estimating tax
receipts. If a rich mans stock falls
to pay 100000 of expected divi-
dends. because the corporation IN
question did not earn the money,
then the Treasury loses more than
three-auarters of the money. The
government fails to collect the cor
poration income tax, which was 10
per cent, and is now, under the
new bill. Is per cent.
But then the whole amount IS sub
iect to the top bracket of that rich
man S income, So when a corpora
ton S income declines, as far as the
Treasury is concerned the depres-
sion skins off the cream, leaving
only skinned milk.
The other factor in the certainty
that taxes must be increased IS tnat
virtually everything that.is waiting
for action by the federal govern
ment contemplates greater spend.
ing. not smaller. This is true OF
the navy, Of the army, of the mer-
chant marine, of trust busting plans,
and Of social security.
Even the attempt at ear marking
!, the relief appropriation was not an
! economy move, but merely one 10
J prevent the administration from
withholding pork from individuals IN
!, the house and senate that It wished
! to punish.
b r. ID. r. Still Strong
/ Planned economy Of business
n with close government supervision
e of production and competition OF
G much the same pattern as Score
e tary Henry A. Wallace is now regu
70 lating agriculture. will be presses
S strongly by left Wingers as the mex
'e step toward recovery. Presiden
Roosevelt is disposed to 60 faloni
with them, though questioning tn
political expediency of such NOV
!, on the eve of the congressional cleo
~ tons.
e Right wing advisers hope that vic
o. tory for the wage-hour bill may dis
!, suade him, but more economic plaT
al ming is the prospect at the tag en-
III of a session in which the Presider
was turned down on government II
=. organization and his favorite ia
~ theories, with an indication OF MOI
- independence in congress and MOI
" turning to-the-right by the govern
- ment in spite of Roosevelts perso
az al views. 1t is the prospect b
y cause of utter failure of pump-prin
- - ing and credit initiation to give bus
ile ness and employment the lift tn
= the left Wingers predicted. 1t
''e the prospect also because, despi
!. the failure of the Roosevelt reco
cry measure and despite the desil
- for independence on Capitol Hi
= various tests show that Rooseve
- still stands strong with the vote
-, that he has the power to defeat,
ne not the power to elect.
oh Conservative independents on Ca
itol Hill are distinctly worried
Ct numerous developments, hence a
at not only afraid themselves but a
a gaining few recruits. Florida MOI
mt mated New Dealer and Tow
ow send plan advocate over an inc
to pendent conservative. Florida in
en- run-off election proceeds to nor
his nate a Townsendite and New De
mt. err for the seat in the house viii
tie that independent conservative .,in
,ro- occupies. Oregon Democrats bs
ute a sitting governor for renominati
tor largely because he had insisted
hit. preserving order in labor disput
. .he Faces Bad Situation
Washington faces the unpre
dented situation of bad depress
and increasing unemployment
are tually helping the administration
oite power, instead Of crushing it as
ces invariably been the case in
pre- country's political history. Congr
cry constructs the various votes ;
and polls as a mandate to the Pr
ing, dent TO proceed with economic
ere perimentation The only quest
hey is whether the President will pr
his luck, and 60 forward with pl
site he has long contemplated and