Evening star., 1941-11-12
Tuxes and Initiation

Even a casual reading between the
lines of the correspondence recently
exchanged by the President and
Chairman Doughton of the House
Ways and Means Committee sug-
geSts that the latter is strongly Op-
posed to a sharp boost in counter
inf1ationary taxes unless and until
the administration gets behind a
really effective price control bill
In his letter to Mr. Doughton, the
President, by implication If not in
express terms, put himself strongly
on record as favoring the recent ten
tative proposals put forward by the
Treasury Department for an increase
in taxes. These proposals, it is said,
contemplate a supertax of IS per
cent on all incomes, after personal
exemptions, to be collected at the
source, and also a boost in Social
Security taxes. Mr. Doughton, in re-
ply, said he was in agreement as to
the dangers of imitation and as to
the Importance of high taxes as
counter-inflationary weapon, but he
made it plain that he had little dis
position to bring the question of in
creased taxes before the House until
that body has had opportunity to
perfect" the pending price control
bill.
This stand on the part of the
Ways and Means Committee chair
man seems to be eminently sensible.
1t would be pointleSs, if not disas-
trous in the case of a great many
people, to boost taxes with a view
to siphoning off purchasing power
unless there is to be firm and equit-
able control of the prices to be
charged for available commodities.
Should the proposed new taxes be
enacted into law, together with the
pending price control bill, the net
result, instead of drawing off excess
purchasing power, might we'll be to
make it impossible for millions Of
people to buy really essential COM
modities.
The trouble, of course, stems from
the fact that the pending legislation
is a price control bill in name only.
AS Representative Gore of Tennes-
see, sponsor of an alternative bill
modelled on the so-called Baruch
plan, expressed it in National Radio
Forum address Monday: The pend
ing bill is IAN open invitation to in
flation." BY its terms it actually en-
courages a further rise in the price
Of farm commodities, and 1t contains
no provision whatsoever for any
control of wages. Furthermore, it
calls for the so-called selective sys-
tenn Of regulating prices, which has
failed in other countries, instead Of
authorizing a blanket ceiling on
prices with provision for modifica-
tion where necessary.
If higher taxes are necessary as
part of an effective counter-infla-
UAOAAoAy dSOAOA1, aAlA VAACy pAoNoOAy
are, the President undoubtedly is
justified in using his influence with
Congress to bring about their enact
ment, for it is understandable that
the legislators, with an election in
the offing, would not be overly anx-
ious to present their constituents
with an increased tax bill. But at
the same time, the cart should not
be put before the horse Higher taxes
may be necessary accompaniment
In price control, but certainly should
not be put forth as a substitute for
it. To this time, the President has
refrained from public comment on
the price control bill now awaiting
House action, but it may be hoped
that before the vote is taken he will
advocate corrective amendments
with the same firmness which has
characterized his plea for an upward
revision of taxes.