Evening star., 1947-11-11
The Political Mill
Stossen's Tax Proposals
Declared Sound Economy
Production and Services, Real Wealth,
Need Incentives, Writer Says
By Gould Lincoln

Production and Services, Real Wealth,
Need Incentives, Writer Says
By Gould Lincoln
Harold E. Stassen, now out hunting Re-
publican presidential nomination, has come
forward with program to free our free enter
prise system. The former Governor of Minne-
sofa is progressive, but he takes issue with
those who believe that progress springs only
from soaking the rich. He does not believe,
either, that this country can play with social
ism and still retain either free economy or
free political system Socialism, in his
more than communism does - or any other
system that makes the state supreme over the
individual lives Of citizens.
His first line Of attack, in order to bring
greater freedom to our economy, is on the ex-
cessively high taxes still imposed on the
American people. With great deal of po-
itical courage, Mr.. Stassen proposes that a
SO per cent ceiling be put on income taxes.
This means that the big incomes In this coun-
try which now are forced to pay as much as
80 per cent i'll taxes would receive very large
reduction in taxation. This Is necessary in the
opinion of Mr. Stassen for two reasons: to
provide incentive to men to continue to strive
for greater production and more return, and
to provide what he calls dynamic capital
capital for new investment. Reductions in
income tax rates are long overdue, Also in the
taxes imposed on men and women of lesser
income.
Theory Behind Proposal.
Mr. Stassen, perhaps because he has repu-
tation for being liberal Republican will not
be accused of favoring the rich to the extent
that such criticism would have lodged against
a more conservative candidate-for example,
Senate Taft Of Ohio. But he will not get off
scot-free. Over course Of years the American
people have been told from high places that
there is something evil about the accumulation
OF great wealth; that their troubles and sor-
rows flowed from the economic royalists.' SO,
many who listened to that line of talk and
many did, will regard stassen glumly.
Not even the Republican, dominated House
Ways and Means Committee, when it framed
an income tax reduction bill during the last
session Of Congress, had the nerve to propose
a greater reduction than 10 per cent for the
wealthy taxpayers who now come across with
90 per cent of their incomes
dynamic capital" are advanced in his new
book, Where Stand published by Doubleday
& Co., Inc. The theory back of his proposals
is that new investments are more important
to the future of Americans than the compara-
lively small amount Of tax payments obtained
by the imposition Of tremendously high tax
rates. Speaking very bluntly Mr.. Stassen ut
tered another heresy-"I would much rather
have large capital accumulations managed by
individual citizens, even though they are rich,
than would have them managed by Govern
ment officials" To this most Americans should
and would-say amen"
Floor as well as Ceiling.
The former governor Is not blind to the rich
playboys and the scatterbrain heiresses, as he
calls them. But his contention is that for every
"no-good rich American" there must be a
thousand who use their wealth soundly Nor
does Mr. Stassen fail to seek floor" in the
taxes demanded Of the wealthy-as well as the
ceiling. Such floor would amount to " per
cent of the total value Of the rich individuals
holdings. This would prevent the escape Of
great wealth invested in taX-free securities
and would compel the investment of other
stagnant funds. While 1t is not Mr. Stassen's
purpose to impose q capital levy, 1t might 50
operate. Wnetner thlS would require con-
stitutional amendment, he has admitted, is an
open question. 1t might be held that such a
tax is not covered by the Sixteenth Amend
ment, which authorizes the levying of income
taxes; that it is a direct tax and would have
to be authorized by further amendment Of
the Constitution.
1t is sound economy Mr. Stassen is preach
ing Only production and services create real
wealth. And the greatest production and the
best services are found under what has come
to be termed here the free enterprise system
Tied in with this system is the personal free
dom of citizens. If central government is
the producer of goods and services it is the
employer of the citizens-and where then does
the individual get off? And what freedom
does he have? He must be dependent on the
government for his food, his very livelihood.
Nor can you have an economy that Is half
socialistic and half free.
Mr.. Stassen is internationally minded; he
believes in helping Europe to recover. But
with great good sense he does not believe In
throwing billions of American dollars down a
rat hole. Believing he does that real re-
covery can come only with maximum pro-
ducton, and that adequate production is i'm
possible under a Socialist or Communist econ
omy he wants the United States to look and
see where the nations needing help are going