Evening star., 1942-10-19

If there's an in
come tax law &saasssss %*
passed, it usually David Lawrence.
has meant that while the rates
might be different, based on capacity
to pay, a person in one particular
kind of a job should not be taxed
more or less heavily than some one
in another kind of money-producing
position.
Now comes the Roosevelt admin
lstration, and without specific au-
thorlty from Congress, not only in
slsts on cutting down salaries fixed
long before the outbreak of war but
1t grants an exemption to the idle
rich and the coupon clippers who
live on inherited wealth.
The man who has risen by his
own toll from the bottom of the
ladder may not now earn in excess
OF $25,000 net income, while the
man who gets his income from divi-
dends or interest can earn 100000
or 100000 a year and be sub
Jected to a less burdensome tax rate
than the salaried man who earns
IN excess of $25,000 net income per
year. Even as between salaried men
the'executive order creates ineoual-
1tles and gross inequities. The
thrifty man, who has paid his debts
and is free of encumbrances, is pro-
hibited from collecting from his
employer more than $25,00O, while
another man who has fixed obliga-
t1ons" and debts can earn far more
than $4,000 a year.
Sees No Equality.
The language of the executive
order says all this is necessary so
as TO provide for greater equality
In contributing to the war effort"
though just how it promotes equality
to penalize the successful and hard
working citizen while rewarding
those who were born with a silver
spoon and who inherited wealth is
not easy to understand.
Congress did not bestow on the
Chlet Executive the right to fix SAL
aries at $4,000 or anywhere else
Tor the good reason that if the
President can today select the s25,-
600 level he can tomorrow select
the $4,000 level. AS a matter of fact,
there would be far more logic in
flxlng all salaries and wages in
America at somewhere around So
600 a year because after all there
are only 10000 persons out of $780,
O0O,O00 who are in the S25, 1000 class
1t certainly would fit the greater
equality" idea better If the $4,000
level were chosen than the s25, 900.
Congress, however, has refused to
tlx any maximum. Indeed it refused
specifically to adopt the proposal
made by the Treasury Department
earlier this year in behalf of the
President to limit salaries to S25 600
by means of initiation. When Con-
gress passed the anti-infiation law
1t was really seeking to eliminate
increases in wages and salaries and
1T gave the President certain power
to adjust wages or salaries to the
extent that he finds it necessary
in any case to correct gross in
equities and also aid in the effective
prosecution of the war"
Says Reference Is Plain.
But this plainly refers to correc-
ton of abuses that have arisen in
war contracts or in salary payments
over and above what has been the
recipients pay for many years. BY
no stretch of the phraseology of
either the preamble or the main
provisions of the law and by no
rule of fairness can the language
of Congress now be honestly made
to mean that pre-war salaries must
be reduced.
Can a $4,000 limit be justified as
a gross inequity"? Congress pre-
scribed no standard and the Su-
preme Court has said this must be
done If legislative power is dele
gated to the Executive. What proof
is there that a $4,000 salary net
income constitutes gross inequity"
and a $4,000 salary does not?
The anti-inflation law is not a
revenue bill such as would be valid
under the 10th Amendment to the
Constitution which provides for an
income tax. 1t Is a piece of war
legislation justifiable only as a meas
ure to prevent increases in purchas-
ing power. But when 1t seeks to
bring about def1ation of certain in
dividual incomes and to use the
machinery of the revenue laws to
accomplish a punitive purpose, the
courts some day may hold it un-
constitutional. Employers may then
find themselves with law suits filed
by employees demanding payment of
sums in excess Of $25, 900 due on past
salaries.
The $25,000 net income limit, how
ever, is a far greater danger to the
man in the $4,000 class than any
piece Of governmental restriction
ever promulgated, for it means Con-
gress no longer regulates anybody's
income, but the Executive has in
effect usurped power to confiscate
100 per cent of all individual in
comes over and above any level he
cares to select.
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