Evening star., 1938-12-19

reached it can be approached
only from one or the other of two
angles-One is to increase taxes
on the American taxpayer. The
other is to reduce expenditures.
Asks Cut in Spending.
ITO me, the most appealing and
necessary course is to reduce ex-
penditures. During the last five
years this Government has appro-
priated and expended for relief pur-
poses nearly 18 billions of dollars.
These appropriation covered a wide
range of Government activities and
were made to meet an emergency
We all must appreciate the vast
amount of benefit which has been
brought to individuals, families and
communities from many of these
expenditures. The program of as
slStance has given succor and relief,
through employment, to millions
whose fighting spirit was Pickering
and whose hope of future had
almost vanished. Many a hungry
mouth has been fed and naked body
clothed because of these expendi-
lures. 1t was the means of many
communities obtaining civic i'm
provements that otherwise could hot
have been obtained, -
But whatever benefits may have
come from these expenditures and
whatever good has been accom-
plished, there are tens of thousands
Of our citizens whose rugged char
acters have been affected and whose
views on life and government have
been transformed. Many whose
forebears' pioneering spirit blazed the
way through our forests and opened
up this new and modern civilization
have come to feel that the Gov
ernment exists to support them and
theirs.
Sees Budget Balance.
"And so, have no doubt that it
is the much wiser policy on the part
of this Government to devise plans
that will encourage private industry
to give employment to the deserving
citizens, rather than for the Govern
ment to continue its present relief
program. If these large expenditures
for relief and other emergency pur-
poses are reduced and more rigid
economy employed, then we can ap-
proach in the very near future the
time when Government receipts and
Government expenditures will be
balanced, and the day will be has
tened when our national debt will
be reduced.
II am not one of those who desires
to see further increase in taxes. I
would not, however, indulge the idle
hope that it can be avoided unless
there is an immediate and radical
change in our spending policy. It
has been necessary for our Govern
ment to tap every source to obtain
necessary revenue, and Federal taxes
are heavier today than in any other
peace-time period. In the imposi-
ton of surtaxes in the higher brack-
cts we have reached the point of
diminishing returns. Before the
adoption of the income tax, the
Federal Government received 96
per cent of its revenue from two
sources customs and internal rev.
enue tax on tobacco and liquors.
Today 45 per cent of the revenue
of the Government comes from the
income tax. It has been increased
from 7 per cent and surtax on indi-
vidual income above $20, ,0Oo, 900 un-
til now 1t runs as high in normal
and surtax as 70 per cent in the
highest brackets. Few can be found
today who object to the theory that
a person should pay taxes accord
Ing to his ability to pay; but wise
economists have and will always
agree that there is a point above
which government returns will not
increase, but will diminish.
If taxes are TOO high, capital win