Proletarec. [volume] (Chicago, Ill.) 1906-19??, 1944-03-22
More Evidence of
Huge Profiteeri ng

According to Randolph I. Paul, general counsel of the Treasury,
the tax laws provide a postwar" windfalr for business that may reach
the staggering figure of ASA billion dollars, even if the war ends this
Before entering government service, Paul accumulated a good-sized
fortune as tax adviser to business concerns. He can't be accused Of
sradicaisn' or prejudice against business.
Tax legislation enacted in 1910, Paul pointed out in a speech before
a refund of taxes paid during the war to meet the cost of conversion to
peace-"a subsidy in the guise of tax relief" is the way he describes il.
For two years after the shooting stops, if their factories do not turn
1 wheel, industrialists are assured of profits at least equal to their post
WI earnings Paul fears they may get more by initiating their costs and
For all its generosity, this provision does not satisfy certain business
groups. They insist that wartime taxes be returned to them NOW and
retained in their own treasures. They plead they can lay nothing aside
or postwar readjustment. Paul exploded that statement.
He pointed out that, after paying taxes and all other charges, cor
ooraton profits during 1943 and 1914 alone will be three times average
profits, after taxes, during the period from 1886 to 1899, inclusive.
Furthermore, he emphasized, these corporations-afte paying taxes and
dividends and greatly increasing the salaries of their offcials-have
already accumulated from their val profits more than IL billions of
If we add the tax refunds to the undstributed profits, we will find
hese 81 co. concerns eem VIII have a postwar 1nestegg' OF S71s billion dollars
or 81 per cent more than the entire national income during the last
Additional light on the fantastic profits of W "a contractors was fur
nshed some days ago by the Truman committee, which for two years
has been investigating various phases of the war program
n bulk Of war business has been given to 100 corporations.
"Of these 100 corporations" the committee asserted, only nine
have been nj fund wholly free Of excessive profit in 1912
normal peacetime profits Concerns which before the war emergency
were never "out of the red" were able to pile up millions of profits in
1912 and even greater sums in 1e4s, the committee said.
The committee cites chapter and verse on the profits of various
contractors. 1t tells of a New York aircraft corporation which had aver
age peacetme profits of $324e3, but multiplied that figure 1863 times in
1912, after paying taxes and dividends.
a small Pennsylvania airphne company which reported an average
s114ooooo in 1912; a cable-making concern in New York in 1912 in
creased its profits % times; an Ohio locomotive plant increased its
profits 1913 times one of the biggest airpiane builders increased its
profits AZ times; a Pennsylvania corporation increased its profits 10
times 49,
The story could be extended endIessly,' the committee said. The
illustrations given ar not exceptional They happen to have been taken
at random from among the 100 corporations holding the largest volume
of war contracts. For smaller companies the profits picture is equally
as excessive.
Only occasionally, the committee declared, did a manufacturer bob
up who placed his countrys welfare above his pocketbook. One such is
the United. Aircraft Corporation of Connecticut, whose officials came
to Washington and turned back 1896, OOO, 900 to the government. They
said they were ashamed to take the money.
But, after making these refunds" the committee observes, 1.-THE
company still had left after taxes in the year 1912 $17000,000 of net
profits, which was a little more than three times its average profit
OF SIS 000,0000 a year during the pre- war base period "
What becomes of President Roosevelts promise that a new crop of
milHonaires" would not come out of this war?
What becomes of the plea of certain leaders in House and Senate
that we can't increase the taxes of the rich and that if w are to get
additional revenue We must place e tax burdens IN small incomes?
Labor. HGE A#I@