Toledo union journal. [volume] (Toledo, Ohio) 1942-current, 1950-06-23
Truman's Corporation
Tax Would Curb
Unhealthy Trend
BY Alvaine Hamilton and Cushman Reynolds
For Labor Press Association

doing okay in the present which is all that
matters to U.S.
Their complacency is solidly founded too,
according to fat-cat thinking. We've had a
look at some of the figures. The statistics
weight but the fat that's being accumulated
isn't doing anybody any good. Moreover, eco
nomic fat like human fat, is an invitation to
trouble. Maybe the fat boys don't know it but
they're asking for a stroke il they don't
change their diet. Trouble is that when the
stroke comes the rest of us will do the suffer
ing.
But let's get down to cases For the first
three months of 1850, profits are way above
last years. Business Week. an authoritative
big business organ, commented recently: "a
few months back, most of the talk you heard
was that 1850 would probably see drop in
corporate income. Even after m ost people
were convinced that we weren't going to have
that recession after all, they still thought in
terms of lower profits. Profitless prosperity
was the phrase they used. What actually seems
to be happening is exactly the reverse. Manu-
facturers' profits are running ahead of year
ago--and at a lower level of business activity"
Well, what's wrong with profits, you ask.
Isn't that what people 60 into busines for?
Sure, people 60 into business to make profits.
But the real answer to the question is that
there's something peculiar about these 1949-
1850 profits. In addition, there's something
unhealthy about the way they're being used.
There are some aspects of these profits you
just don't see reported much in the papers.
Here's one joker. According to the Securi-
ties 81 Exchange Commission, corporations
aren't using their profits, their excess funds
after paying taxes and dividends, to expand
the nations economy However loudly cor
poration officers talk about new frontiers in
business, and how the American system Is
to achieve and maintain health through con-
slant expansion and Improvement, the fact
remains, according to the SEC, that in 1949,
the corporations used only half their excess
profits to increase their productivity. T he
other half, amounting to some $4,000, 100000
Is ???????? invested in government bonds
or resting serenely In corporation bank ac-
counts. For the big outfits, the bonds and the
bank accounts are just so much stored up fat.
A doctor would tell patient in the equivalent
the pork.
Actually, the corporations ought to be u.s.
Ing the extra money to devise ways to produce
more goods at lower costs. Any developments
along that line would result In lower prices.
In turn, lower prices would mean that wage
earners could buy more goods and create
demand for greater national production. In
evitably, the result would be higher buying
power for our wages and probably an actual
increase In dollar wages. In the process, prof
It's would take care of themselves. you could
bet your last new high-purchase- power dollar.
Naturally, none of these things has hap
pened Prices have been level long time,
and with the arrival of spring the cost of liv-
ing rose little 1t will 60 higher by the end
of the summer. There hasn't been a wage
boost on any sizeable scale for months, and
none seems likely. Meanwhile, corporation Of
ficers bank their money, beef about taxes and
b / m the government for whatever is or
isn't happening.
While the corporations and their officers
get fatter, ominous signs of economic NAL
nutrition are springing up across the nation.
We mean unemployment, the desperate kind
of unemployment we knew Is and 20 years
ago that finally was licked by that expensive
shock treatment of a war economy. In many
communities, men and women again search
hopelessly for work m ont h after dreary
month"; and never find it. We have heard some
of them tell their stories when they visited
Washington under union auspices. AFL and
CIO economists paint sad pictures of the situ-
alton in many centers including some of the
nations largest cities. Unemployment Is fire.
quently longest they find, in those industries
such as textiles and tobacco which reflect di-
rectly the purchasing power of the average
family. To make matters worse, in June
bumper crop of high school an college gradu-
ates will be hunting jobs. The CIO and AFL
will do what they can through local COM
mittees and find-a-job campaigns but the
real solution Is economic expansion.
In the end you come to taxes. All the
above underscores the need for the kind Of
tax program President Truman has asked
for and which Is begged down In the House
Ways & Means Committee. Perhaps you
should add to the tax program the Presidents
new small business program In any event,
the 25 members of the Ways & Means Com
mittee had better step on the gas or they will
win for the 8lst Congress undisputed right
to the title "Do-litte Congress" They have
chance to halt the unhealthy practices of
storing up fat In one place while mulnutri-
tion spreads in another.
The Truman proposals call for increases
mild increases TO be sure in corporation
taxes. But the increases may be big enough
to induce the big companies to reinvest some
of the profits in improved productivity in
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