Evening star., 1953-06-13
Reeds Group
May Not Report
Profits Tax Bill
Administration Fails
To Prove Its Case,
Chairman Asserts
By Robert K. Welsh


Ways and Means Committee
asserted today the Eisenhower
administration "has failed to
make a case" for extension of
the excess profits tax after two
weeks of public hearings on the
proposal.
The New York Republican, at
the committees final session of
the hearings, urged Congress to
let the levy die on schedule June
30. He indicated he has no i'm
mediate plans for calling the
committee together to vote on
whether to report out a six
month extension measure re-
quested by President Eisenhower.
Mr.. Reeds statement came
only few hours after Secretary
of Commerce Weeks last night
criticized several business organ
izations for opposing the Presi-
dents plea for extension of the
tax.
The chairman's attitude, while
consistent with the stand he has
taken all along, raised still more
doubt that the Ways and Means
Committee would report out q
bill of any kind.
Calls Tax "Vicious."
I'm my considered opinion the
administration has failed to
make case" Mr.. Reed said.
1T has taken the position that
the excess profits tax is an un-
economic and undesirable levy,
but because the tax produces
some immediate revenue it
should be retained.
This contention is based on
the false philosophy that the end
justifies the means. It is
short-sighted viewpoint, so mar
row in fact that it deals with
only the six months ahead. It
fails miserably to fully compre-
hend the evils inherent in the
excess profits tax.
1T ignores the indisputable
fact that this vicious tax is dis
criminatory, that it does ir-
reparable harm to small busi-
ness, and that it possesses a di-
rect threat to our general long,
range economic stability
Mr.. Reed repeated his earlier
contention that the $500 mil
lion estimated revenue from ex-
tension of the tax is entirely too
high an estimate" but that in
any event such revenue could
be obtained by further cuts in
foreign aid.
'The administration can no
more justify an expenditure Of
$5.4 billion in the next fiscal
year for foreign assistance than
it can justify continuation of
the excess-prof1ts tax" he said.
"A grant of $3.4 billion, plus the
billions in unexpended funds left
from past appropriations, would
be sufficient for the needs of our
allies"
Only Few Support Extension.
Mr.. Reed recalled that the
hearings before his committee
during the last two weeks were
at the request of the administra-
ton. These hearings, he said,
have brought out only a handful
of witnesses urging extension of
the tax, but "a parade Of de-
termined opposition"
He noted that advocates Of
the extension proposal were
mainly Treasury officials and
Representatives Of a few such
organizations as the CIO and
the Committee for Economic
Development.
Secretary Weeks told a group
of manufacturers in White
Sulphur Springs, w. Va, last
night that las a business
man in Government, I am
shocked to find some business
men ignoring the financial men,
ace hanging over this Govern
ment."
"Blind to Realities"
Mr.. Weeks told the Manufac-
turing Chemists Association and
the Synthetic Organic Chemical
Manufacturers Association:
If businessmen don't back up
wise financing and If. as a re-
suit of their walkout, the sound
money program fails. then, in
the consequent imitation and
mounting debts. businessmen
themselves will suffer severely.
Yet some of this group seem
blind to realities"
Despite appeals by the admin
istration, the National Associa-
ton of Manufacturers and the
United States Chamber of Com
merce declined to drop their op-
position to extension of the tax.