Evening star., 1948-01-18

A1iNo4A4O hA eashCc No DCAk1S OchCo AhVS
and organizations. One line of r
easier on the rich is that the count
form other than taxes. That form Is
capital, to expand production.
There Is no unanimity in this, by
any means. The claim of the lower
brackets to the first call on relief
from the tax burden has been stated
often and ably. Outlining the cur
rent attacks on the high rates ct
which taxes are assessed against in
comes in the upper brackets does not
indicate any disposition to disregard
or minimize the other arguments.
Fifty Per Cent Top Urged
The United States Chamber of
Commerce and the National Asso-
citation. of Manufacturers both urge
that ceiling of so per cent be
placed on income taxes. A number
Of other organizations are support
ing their position.
AS for individuals who advocate
this policy, they include one Re-
publican candidate for the presi-
dency-Harold e. Stassen, former
Governor Of Minnesota. Neither the
State nor Mr.. Stassen are given TO
reactionary policies.
One organization of high standing,
however, the Committee for Eco
nonic Development, does not urge
that the top rates be cut back to
less than about the level of 1885.
fn that year the New Deal turned
10 what 1t called q taxation for
social reform program, traceable to
the earlier share wealth
campaigns. In the doldrum days
Of the depression the share-the-
wealth idea was attractive to many.
People sang the song about the
rich getting richer and the poor
having children. IT'S catchy tune
belied It's eynicism, but many
thought there was some truth in the
words. There was q widespread
feeling that the rich were too rich
and the poor were too poor.
Fewer Million-Dollar Men
In 1885 individual srlrtaxes were
boosted beginning at 81 per cent on
$4,000 and reaching rs per cent on
amounts over 5000, 900.
A good deal Of social reform In
this line had already been accom-
pIshed by the depression. In 1929
there were 513 persons with million
dollar incomes; in 1885 the number
had fallen to Al.
With the war all taxes were upped
until the man with q million dollar
income was taxed about 80 per cent.
That is the case today. And in the
more modest brackets, a man who
earns $4,000 finds that If he earns
another thousand the Government
will take half of that in taxes.
In the words of the Committee
for Economic Development, the tax
payer from then on has only q
minority interest In his income.
The argument for the need Of
capital for production, from those
in the upper brackets, runs about
like this:
Prices are high because too many
people with money are competing
with one another for the available
supply Of goods. To get prices down
and lick imitation 1t will be neces-
sary to reverse this condition. Goods
must be supplied in such abundance
and at such prices that the sellers
will compete with one another for
the consumers dollar.
Conant's Viewpoint
It Is now practically impossible
to produce more goods at no extra
cost because almost every employ
able person in the country Is work.
ing. II you lengthen the hours you
run into overtime and higher pro-
duction costs.
Ths way TO do It Is by supplying
the worker with more efficient tools
and machines and by developing
new companies and new industries
That means the investment OF huge
amounts Of capital.
One Of the chief sources Of new
capital is people with big incomes.
But why should q man with a big
income risk his money when, If his
venture Is successful, he Is allowed
to keep less than half of the return?
Why should a man work hard and
take chances when he will have only
minority interest in the profits
resulting?
The last part Of this argument
received unexpected support from
President James B. Conant of
Harvard. He warned that the pres
ent tax system Is having "a pro-
found effect on the incentives which
thus far in our history have con-
tributed to the taking of risks and
the seizing of opportunities.
Americans believe in the equality
Of opportunity in a fluid society
without hereditary privileges, he
said, and that belief is reflected in
high inheritance taxes. High taxes
on, earned income have the reverse
effect on the fiuidity of our society,
he maintained. Therefore, insofar
as the national expenditures permit,
the case for keeping income taxes
low is overwhelming, both in terms
of social ideals and incentives"
Stassen's Reasoning
Mr.. Stassen, in his book, Where
7 Stand" said he believes that
government that demands more
than so per cent of citizens labors,
or ingenuity, or inventiveness, or
other income is government killing
the future of its average citizen and
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