Evening star., 1953-02-01

House Ways and Means Commit
tee, the group that writes the Ma
tion's tax laws.
The Democrats pointed out that
Reed, whose views on tax matters
were opposed to those of Ike, would
be chairman of the committee
under a Republican administra-
ton. Nothing but trouble could
result, the Democrats warned
darkly.
After the first full week Of the
new Republican administration, it
looked as if the Democrats had not
been entirely wrong. Reed, no man
to knuckle under in dispute, was
stubbornly pushing against the
G. o. P. apple cart last week.
President Eisenhower and his
executive family take the view that
the budget must be balanced be-
fore taxes can be cut. They even
convinced G. o. P. leaders on the
Hill-among them Styles Bridges
in the Senate and Joseph w. Mar
tin in the House-that pay-as-you-
go financing should be the first
fiscal aim of the administration.
But Mr.. Reed was in no mood
to wait. When the 83d Congress
was called to order January he
was ready with tax cut bill. It
was honored with the designation
H. R. l, but House leaders did not
expect to take action on it. They
expected to wait for President
Eisenhower's budget and tax rec
concentrations.
= 'Everybody's for IT.
Last week, however, Reed blasted
ahead with his tax reduction bill,
and, to the surprise of the House
leadership, seemed to be making
good progress. Practically every
body is for my bill," Reed claimed.
The Reed bill would kill on June
80 the personal income tax increase
which went into effect in 1851.
The reduction would average about
10 per cent on each persons tax
bill. The exact figure would de-
pend on an individuals income.
High-income brackets would bene-
fit least.
The 1851 increase would expire
automatically December 81 of this
year. The Reed bill would move
the expiration date up to match
that of the excess profits tax. The
package would make a nice Happy
New Fiscal Year present for both
corporations and individuals.
Red-lnk Warning
Outgoing President Truman,
however, sent budget to Congress
which estimated that the Federal
Government would go into the red
500 billion in the coming fiscal
year. The Truman budget called
for expenditures of $78.6 billion
and estimated receipts at $6S5
billion.
The Reed bill would mean an
income loss to the Government Of
between $1.2 and SIG billion In
fiscal 1854, and expiration Of the
excess profits tax would cut reve-
nue. another 5000 million.
Gen. Eisenhower hopes to cut
spending to $40 billion in the
coming fiscal year and hopes that
tax receipts will be q little better
than anticipated by the Truman
regime. That would give him .
fighting chance to balance the
budget and then look for tax cuts.
But the Reed bill would make q
balanced budget extremely difn-
cult to attain.
When this was explained to him,
Reed announced firmly, 1--WE are
going to report it out and pass it,
and the Senate will pass 1t, too"
He predicted that the deed would
be done before the end Of Feb
ruary.
BY the end Of the week the
House leadership was convinced
that the Reed bill was, in fact, .
popular one with Congressman.
There was less talk of blocking
the Reed bill and more talk Of
merely delaying action on 1t.
Chairman Allen Of the Rules Com
mittee said he would hold the bill
up in his committee for a few
months.
It was hard to see, however, how
Congress could complete action on
the Eisenhower budget and then
turn out tax cut bill before June
80. The budget is not expected to
go to the Hill until April. If Con-
gress gives it as lengthy a study
as recent Truman budgets re-
ceived, the lawmakers will not
have it hammered into shape un-
til well after the new fiscal year
begins.
Passage of the Reed bill would
mean that Congress was cutting
taxes before 1t completed It's at
tempt at balancing the budget.
That is not the Eisenhower pro-
gram.
Democrats waited eagerly to seO
what President Eisenhower would
do about 1t.