Evening star., 1939-05-13

puSllG W Dt dIl-
o h e which rs
would yield the
same amount of David Lawrence.
revenue He places the burden of
working out such scheme on Con-
greSS, where, of course, it belongs.
Those persons who think Mr. Roose-
welt is failing to cooperate with
business when he declines to assert
himself aggressively on behalf of
tax revision entirely overlook the
fact that this is spending Con-
gress.
Judging by the size of the new
farm bill just passed by OverWhelm-
ing vote in the Senate, every men,
ber who ever made a speech in
favor of a balanced budget or econ
omy and yet voted for the new
farm bill over a letter of apology
to President Roosevelt and Gov
Eccles of the Federal Reserve Board.
Certainly there is no encourage
ment in this action for Mr.. RooSe-
welt now to offer program Of tax
reduction which will further reduce
Situation Further ClOuded.
The whole situation, as between
the opposition to the admlnlstra-
ton and the President. is getting
more and more clouded. On the
one hand the Chamber of Commerce
of the United States adopts resolu-
tions which administration spokes-
men and high officials regard as an
attempt to scrap the whole New
Deal program without regard to OBJ
jectives and, on the other hand,
business critics are insisting that
the administration ought to be max
ing more overtureS to business
Reconciliation of opposing views
and the working out of a program
has not been made easier by the
events Of the last few days.
The tax program, to be sure had
its origin in congressional insistence
that something be done at this ses-
sion to remove the "deterrents' to
business. Much discussion Of that
word has left doubts as to what it
meant In the view of Undersec-
retary Hanes at the Treasury and
others. the word has reference to
clauses in the present tax laws
which, for instance, do not bring in
any revenue at all. but which deter
business reorganizations and changes
in debt structure. All sorts of in
equities are present in the law which
prevent the Treasury from reaping
as much revenue as it should. There
are other things, called 'deterrents,"
which are in the nature of in
centives," and these lie in the con-
jectural realm as to what revenues
might be brought in.
Administration in Dark.
Certainly, so far as the admins
tration is concerned, it has to be
persuaded that business will be i'm
proved If all the proposed changes
in the tax laws are made. Likewise,
1t would doubtless like to know how
much further toward increasing the
deficit and the national debt Con-
gress proposes to go and how the
legislators are going to raise the
money to pay for their new spending
follies.
The President has been cautious
about the tax revision program from
the start. The Treasury has been
enthusiastic and has been working
hard trying to develop the right
amendments. Mr.. Roosevelt keeps
his own counsel and his own
strategy, but it would seem that he
really wants something done about
the tax laws, especially cumbersome
and unavoidable provisions, and that
he Is willing to go along on some
rate changes. but that if Congress
keeps on increasing the deficit and
II business keeps on trying to
sabotage his program in Congress,
he may not bestir himself on the
tax program. There is no evidence
of this trend as yet, but it is an
explanation of recent happenings
which is plausible, in view of the way
political currents move in the Ma
tional Capital.
May Explain Receipts.
This analysis would appear to be
all the more reasonable because the
actual amount of money involved
in the proposed tax changes is rela-
lively a small sum compared to the
size of the whole deficit, and there
is much to be said for the argument
that If business is given the proper
incentives the Treasury may find
itself with expanding tax receipts
and genuine recovery movement
under way.
The strategy of the President in
his relations with Congress is not
always visible to the naked eye, but
In this instance it would seem that
either public sentiment for tax re-
vision is not as strong as it is
cracked up to be, and hence Mr.
Roosevelt can afford to be lukeWarm
about it, or else that the President
prefers to let Congress have the
ball this session and take full re-
sponsibility. This latter way used
to be the method of enacting tax
laws and the strange thing is that
the Senators and Representatives
do not yet realize that it is their
function to write the laws and to
get from the executive departments
various suggestions, recommended
tions and data. and not instructions
oS tn how tn lepjSlate