Milford chronicle., 1956-05-04
TAXING PROBLEM STUDIED WITH
SENSIBLE VIEWPOINT

One of the most thoroughly documented of
these plans was recently offered by the Ma
tional Association of Manufacturers, under
the title "A Tax Program for Economic
Growth" 1t is designed ito outline the
means by which existing determinations can
be lessened without adverse effect on the
revenue or increase in tax burdens Of any
group"
1t is impossible to do justice to so care
fully prepared and reasoned a program in
short space. But the highlights can be out
lined. 1t is based, to begin with, on a set of
principles First, the taxing power should
be used for fiscal purposes only-not for
social concepts in taxation" Second, the
federal tax system should be broadly based
with all citizens, groups and communities
contributing to the governments support
with as few exemptions or exclusions as
possible. Third, taxation should not impede
economic progress-that is, it should not
discourage or penalize saving and invest
ment. Fourth, tax rates should be moderate
at all points, on both businesses and individ-
ualS Fifth and last, cOnStitut- Onal limita-
tions should be imposed on the federal power
to tax incomes, estates and gifts.
One section of the program deals with
"tax facts VS.. tax principles" 1t thoroughly
disposes of the idea that our present prog
ressive system taxes the rich to spare the
poor. For instance, the individual income
tax levy for the 1856 fiscal year totals $685.
784,000,0 900. A whopping "a per cent of that
amount is produced by the 20 per cent basic
rate, which is applied to the lowest taxable
incomes. Only 16 per cent comes from the
progressive elements in the tax scale, even
though these rise swiftly and pass 80 per
cent.
The program also holds that the present
federal tax system, if continued, will retard
capital formation in the future. And capital
formation-which is simply term to cover
the accumulation of money for investment
in all the things industry needs to produce
goods and services-is the source of jobs,
better tools and plants and machines, and
economic progress as whole. According to
the program, the labor force is expected to
grow at the rate of about l million people a
year, and if ''jobs are to be provided for the
new workers, and if the national standard of
living is to continue to advance, large and
increasing volume of capital formation will
be required in the years ahead"
The programs specific recommendations
cover every phase of federal taxation and
revenue. Most important is the goal of re-
ducing both corporate and individual prog
ressive tax rates to a top of 35 per cent.
This, the program states, can be done with
out imperiling the revenues the government
needs. 1t should be done over a five-year
period. In the case of the Individual income
tax, there would be successive annual re-
element of each rate bracket. Personal1ex=
emptions would be maintained at the pres
ent levels.
Much more will be heard of this program
as time goes on. 1t is based on the economic
realties-as well as on theories of taxation
which the great majority of economists re-
gard as sound and as necessary to our eco
nomic progress and stability.
THE REAL QUESTION
The principal recommendation of the
widely-praised report of the Presidential Ad-
visory Committee on Transport Policy and
Organization is that, in the public interest,
the common carriers should be allowed great
er competitive freedom in pricing their serv-
ices.
In discussing this eminently sound pro-
posal, interested parties say that the real
question to be considered is whether one
form of transportation should be stopped by
government regulation from making COM
petitive rates which are fully compensatory
simply because they may have an adverse
effect upon a competing form of transporta-
ton. To this question, the answer of the Cab
met Committee is that in reviewing cOmpet-
tive rates of one form of transportation, the
Interstate Commerce Commission should not
consider their effect upon competing forms.
The committees key recommendation for
increased reliance on competitive pricing in
ansportation-since endorsed by important
shipper groups-is that the ICES use of its
minimum rate power to apportion traffic
among competing modes of transportation
without full regard for their inherent ad-
vantages or economic capabilities be brought
to an end, and that rates published by one
mode that are compensatory and non-dis-
criminatory and otherwise lawful be allowed
without regard to their effect upon another
mode.
All the carriers have their own particu-
lar virtues Each can do some job better
than the others Competitive pricing will
enable each to make the fullest use of those
inherent advantages-to the benefit of ev-
eryone who uses public transportation.
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CAPITALISTIC EXPLOITATION
u. S. STYLE