Milford chronicle., 1956-03-16

Psessive hue after many years of deficits
Two things can be done with this surplus.
1t can be applied against the national debt,
now straining at the legal limit. Or it can
be used to reduce taxes.
The first alternative is favored by num-
Der Of respected leaders of both parties, and
by many top economists both within and
without governmental circles. Sound fiscal
policy, they feel, demands that substantial
debt reduction precede any tax reduction
That course may be followed But, at this
time, the odds favor tax reducti0n-one COM
pelllng reason being that 1856 is an election
year, and an appeal to the pocketbook is a
powerful one.
However, it is one thing to advocate tax
reduction as a principle-and a very differ
ent thing to specify just where and to what
extent taxes are to be cut, and what groups
are to be primarily benefited. And here the
differences cut across the party lines, as they
do nowadays in so many matters of high pol
icy.
The basic difference is one of philosophy.
Should tax reductions be geared principally
to help the high-income families, the middle
income families, or the lOW-income families :?
This question, obviously, involves political as
well as economic considerations. AS u. S.
News & World Report states: "An argument
cited by many IN Congress who favor reduc-
ing the top figures is that so little revenue is
collected from high-braclxet rates A reduc-
ton in the top rate to as little as so per cent
lit is now 81 per cent) official figures show,
would cost the u. S. Treasury relatively little
revenue. There is the contrasting argument
potent in an election year-that most tax
payers, and voters, are in the lower brackets
and that they should get tax relief. Yet even
small cut from low-inc0me families would
create a tremendous drain on The IT, S. Trea-
sury. The reason is that there are so many
taxpayers in this group"
In any event, the staff of the Congress
lonal Joint Committee on Internal Revenue
Taxation has produced for the Committees
information, 19 different plans for reducing
Individual income taxes. These plans are
briefly described by u. S. News, and they
illustrate the difference in basic attitude to-
ward tax reduction as principles well as
the many variances in relatively minor de-
TAIL
One plan, for instance, would cut taxes
by flat 10 per cent-which would mean
S52 reduction for four-member family with
a $4,000 income, and $5,191 at the 100000
level. Another would give $40 cuts for each
taxpayer and dependent-that is, identical
reductions no matter what the income brack-
ct. Another would allow $50 minimum de-
duetion-which would give $4,000 families a
$40 cut, but would give nothing to those with
S5,OOO or more. Another would cut all rates
by two per cent-and allow savings ranging
from SI2 for the So, 600 family to ST, ,952 for
the 100000 family.
The most important plan, it would seem,
is that which, according to II. S. News, will
be favored by the Eisenhower Administra-
ton if it decides in favor of tax relief. It
provides a returning to the pre-Korean tax
rates, Savings would be $40 at the S., 900
level; $231 at $4,000, $792 at $4,000 and
$6,269 at 100000. The magazine says that
Mr. Eisenhower's top tax advisors have in
sisted that, when tax-cutting time comes, the
nation should climb down the tax ladder the
same way we came up"
A FEW FACTS
Current discussions of farm problems Of
ten generate much more heat than light
The pork situation is in point. The prices
farmers receive for their hogs have declined
very sharply over considerable period of
time. And there seems to be a widespread
impression that very little of the drop has
been passed on in the form of lower prices
for pork.
Actually, as of recent week, the average
costs Of barrows and gifts at the great Chi
cago market was down 81 per cent from the
relatively high levels of two years before.
Wholesale pork prices on fresh basis, by
comparison, were down 35 to SO per cent,
which works out to an arithnetical average
of 81 per cent This is very close relation
snip, IN the Hgnt OF the TACT that the Oper-
ating costs borne by the packers, largely be-
cause of wage boosts, have risen greatly.
These costs awe fixed for the most part, and
are not affected by fluctuations in livestock
values.
The producers of meat animals would do
well to consider another set of facts. In 1855
the farmer got Al cents out Of each dollar
paid by the consumer for farm-produced
food His return in the case of meat was
much higher than this overall average. Ac-
cording to the Department of Agriculture,
81 cents of the consumers dollar spent for
pork (much of it processel) was returned to
the farmer for hogs. And 81 cents of the
consumers dollar spent for choice beef was
returned to producers of cattle.
One more fact completely refutes the
statement that the middlenan is prospering
at the expense of either farm or producer.
Tha4 fact Is this .aSt wear the hacking IN