The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1938-03-31
Taxation
Problem

EOOkS" 4SACA W tiAS
broader policies in
which they are interested. Such
statement was that made lately by
Sen. Pat Harrison, Mississippi DEM
ocrat, with reference to what the
senate will do on the pending tax
bill. At least, nearly all of the OBJ
servers here who know the lovable
Pat Harrison were quite convinced
that, when he said the senate would
grant business relief from unfair
taxes, he actually was proclaiming
congressional independence of Pres
ident Roosevelt.
This question of taxation is one
with which the New Dealers are
gravely concerned; they are just
as much concerned as is business
and the country as a whole. But
they are concerned for a different
reason. Sane minds throughout the
country long ago began to beg con-
gress and the administration to
make changes in the tax laws to
permit business to go forward with
employment and production. New
DSo4SAo olldShCO wiz o2AO
that as an economic royalist" or
tory or some other one of the va
rious things that the New Dealers
profess to hate. After so long
time, however, the New Dealers
conceded some changes were neces-
sary-and then began the greatest
face-saving maneuvers yet to be
tried by the wishful thinkers.
When word went to the house
ways and means committee that it
could make notifications in the two
pet New Deal tax laws, the ageing
Chairman Doughton, of that COM
mittee, followed instructions. Of
course, there were seventeen Demo-
Gratis and seven Republicans on the
committee and that enabled the
New Deal to carry out its plans for
modification" of tax lawS-and to
save faces. Regular Democrats and
Republicans in the committee men,
bership still were in the minority in
the house of representatives, and
the New Dealers had their way. The
tax bill debate in the house never
theless told of more slaps at the
administration that lay ahead.
At this point in the developments,
Senator Harrison enters upon the
stage. He is chairman of the SEN
ate committee on finance. His state
ment, therefore, that the 1888 tax
bill is going to give some basis upon
which business can break even, at
least, can be taken as indicative of
the final form of that law when it
emerges from congress. The house,
under the lash of White House lob
byists, managed to hold part of the
ways and means committee draft
in its original shape while losing
other parts of it. Thus, when the
senate has acted and the bill is sent
to conference committees for ad-
justment of the differences, it is
rather plain to see how Democrats
and Republicans are certain to over
ride New Deal face-saving.
I have written much in these COL
umns about present tax policies
heretofore. There
Harrison is little need to re-
Speaks Out peat the facts
which continue to
be important factors in the develop
ment of the Roosevelt depression.
The assinine tax on undistributed
earnings, fathered by the radical
Prof. Herman Oliphant of the Treas
ury staff, has not allowed any cor
poration to build up reserve. It
took all of the earnings of last year,
a period in which some corporations
did make money in a limited way.
Now that the depression is on us
again, corporations obviously are
scared stiff. Wage cuts are crop
ping up here, there and everywhere,
and every time there is a wage
cut the nations buying power is re-
duced to that extent. But what is
an employer going to do? Go broke,
in order to keep his payrolls up?
That is hardly human, it seems to
me, since everyone desires to pro-
tect whatever funds he may have,
be it a dollar or million.
So, when Senator Harrison spoke
out boldly that something was 60
ing to be done to eliminate some of
the obstacles which wishful thinking
New Dealers have built up in their
experimentation, it means, I be-
ieve, that Senator Harrison pro-
poses to do just that.
The politics of the situation is an
other matter. That phase is equally
important and significant. Senator
Harrison would not have spoken out
a few years ago, or even a year
ago, as he has done lately. The
house year ago would never have
rejected what has been called the
"third basket" of taxation. (The So
called third basket was a new type
of tax that would have made the
rates sky-high on corporations held
by only few stockholders, family
owned corporations like thousands
of small companies usually are.)
No, the house would not have killed
that year ago, but it did this year.
And, when Senator Harrison dared
to say congress will do thus and so,
Senator Harrison was simply voic-
ing fact. He was saying, in eff
feet, Whether you like it or not,
Mr.. President, we will write the tax
law in the interest of the country as
we see it,