Detroit evening times. (Detroit, Mich) 1921-1958, 1942-08-18
Poor Man
Must Carry
Tax Burden
Only Place Where u. S.
Can Get More Money
BY PAUL MALL0N

liberal elements are crying out
that the new tax bill "Soaks the
poor" meaning the union war
worker.
This is somewhat true
Orthodox liberalism. as pro-
feSSionally conducted in this
country in last 20 years, has al
ways cried out against every tax
bill on the same grounds, and
successfully urged that il soak
the corporations and the rich
instead.
With equal political astute-
ness, and less success. business
has orally cried wolf
against tax bills, saying each Of
these would make business UNI
profitable, cause breakdown
in our profits system.
WHAT has caused the delay
w in the new tax bill. il is
now clear, is that the House
ways and means committee and
the Senate finance committee
have discovered that the To-
year-old program of increased
taxes on corporations and the
rich has lifted these rates 10
the ceiling. There is just no
more blood in those turnips.
Existing taxation, without the
new increases of the pending
bill, is already forcing down
dividends, making even acceler-
ated war business less profitable
than normal peacetime business.
Faced with the necessity OF
raising more war revenue now,
and with maintaining colossal
taxes to pay the interest on an
expected debt of $500, 100000
600 or more after the war, the
congressional lawmakers have
found they must 60 deeper into
the normal business profits in
the new bill. Confiscation of ex-
cess war profits will not furnish
enough revenue.
THE basis of our capitalistic
L democracy, the one we are
fighting for, is profits. A prof
its system can not be run sue
cesSfully without them.
If this were temporary mat
ter of sliding through a war Pc
Rod without them, it could pos
sibly be done. But as the gov
eminent is faced with the neces-
Sity of continuing this same
level of taxes after the war,
there can be no doubt that our
national future, as well as our
current war-production effort, is
wrapped up in this tax question.
Every one knows there is
point at which taxation becomes
nationally suicidal. and every !
one liberal and business mani
can agree where that point is
the point at which business pro-
duction seases to be profitable.
When that point is passed.
labor can get no wage increases,
opportunity for work mus st
shrink and the system of pro-
duction bends and breaks.
The Senate committee hearings
have shown that point was not
only reached but passed in the
House bill in many corporate
instances. Business men have
come to the Senate, with their
books for the first time in tax
bill history.
CERTAIN examples were re-
~ Gently shown in this column,
TO which one more recent illus
tration may be added. One Of
the last to testify was the
Ecusta Paper Corporation of
Pisgah Forest. N. c.
Its earnings statement showed
the House bill would force it to
double the price of its product
(cigaret paper) next year in
order to break even-and If the
fiscal year provision of the
House bill is maintained it would
have to quadruple its price TO
meet taxes for the final
quarter.
It's profits. before taxes, would
be SIS, 943, 1888 for this year under
the House bill. of which the
state and federal governments
would take all but S729,7 11.43,
leaving an insufficient amount
TO meet its annual debt interest
of 81, $4,000.
Many of these dangerous de-
fects in the House bill would be
eliminated by the Senate COM
mittee. The withholding tax no
doubt will be revised. Credits
for debt and interest will be
adopted.
4 DEFERRED maintenance
"A credit will be allowed for
industries like the railroads.
burning up their m a h ne
faster in war activities than the
depreciation allowances recog-
niZe.
The only place, then, where
the government can get more
money is from the union
worker. the low salaried man,
the poor" if you will.
The time therefore has come
for a complete revision of po-
litical views, from both liberals
and government, on this sub
ject. 1t is no longer truly lib
eral or progressive TO advocate
further expansion of the taxing
methods of former years TO the
point of destruction.