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About Morning Oregonian. (Portland, Or.) 1861-1937 | View Entire Issue (Sept. 22, 1909)
o TITE MORNING OREGOXIAN, WEDNESDAY, SEPTEMBER 22, 1909. . , TAFTSPEAKS FOR CORPORATION TAX Defends Compromise for In come Revenue and Post pones Conservation. ENGLAND USED AS OBJECT BiH Passed by Congress, He Says, Is Bet Form of Income Tax That Could Be Pcvlsoil ana snows Faults in Direct Primary. (Continued From First PMO an Inheritance tax. but the objection that tha states had preempt that field, baa sufficient weight to defeat the proposl tion. Tha President then continued. Income Tax proposed. - A part of the Republican and all of th t'r eonaldaratfon a general Inrom. tai i on individual! ihrouKhout the I. n ted J5"?! Ths Uw u as near as It could be made T.iZ7 Uw which had on.-e bee oon.Mered by .h. Supreme Court .om. ten years aso ana wnion constitutional by a vote of Are to conceded that the tax would probably from dino.oo.ooo to which was far in eire.ia of the need, or the Ooi TrVment If the tariff bill were to retain iti reneral form. as propo.ed and o to produce revenue, which should be -ibly expected. Our- frlen.l.. the Democrats. ?.rnre4 th. income tax with a view to sub etltutlng It for the tariff a. an Income pro ducing me.ure, thus minimising th. eff ect of the tariff In protecting the Industrie, ot the country. , , In other word., the pa.wae of th. hwrn. tax bill would have lent .upport probably to the proposition to hav. a tartft for reve nue only and would hav. Interfered with t". protective policy to which th. Republi can party I. pledged. To Question Court Bad. One farther objection to the Income tax amendment a that It had been declared unconstitutional hy the Supreme Court and to Involt. a second decision upon that Issue was to question the uniformity of th. de cision ot the Supreme Court and to drag the court into a political discussion. hlch. whatever Its dectsion. would not make lor It. standing as an Impartial tribunal before It Indicated a diversity of view between Congress and th. courts two co ordinate branches-wlth reference to the constitutionality of the law. which It seenw-d unwise to perpetuate In a formal "" Hut th. Incom. tax amendment seemed HKe lv to pas. hy the vote of all Democrats and sufficient number of Republicans. Therefore those who were opposed to tne Income tax amendment looked about to see If a compromise could not be proposed less objectionable than the Income tax amend ment, which would satisfy a few of the Re publicans who were Inclined to favor the Income tax to prevent the passage of that amendment. . , Suoh a compromise was found in a pro posal to psss the present corporation tax and also the joint resolution already In ferred to. proposing an amendment of -th. Federal Constitution to the states author izing the General Government to Impose an Incom. tax without proportioning It as a di rect tax, according to th. population of th. tatea. Premium placed ea Perjury. Th. provisions for th. corporation tax hi th. bill exempt all corporations whoo net Income does not exceed $5000. It Is. there for.. In effect an Income tax; that Is, It taxes earning, actually mad a It la a tax upon success and not faJlure. The most objectionable feature of a dirsrt Income tax Is the premium upon perjury which It offer, to lhue who are willing to conceal their Incomes a matter not at all difficult to do and who thus subject to a much heavier proportionate burden those who are conscientious In making their re turns and who pay their tax as th. law In tended. So great was this evil In th. levy o an Income tax In England that when tliat tax was Imposed directly upon Indi vidual, as was proposed here In th. so calied Income tax amendment bill. It was found the proceeds of the tax at 10 per cent wer. less than th. proceeds of an Income tax of i per cent imposed as our corpora tion tax la. not upon th. Individuals di rectly but upon th. Incom. before It come. Into their hands. Tnls Is a practical argument In favor of the corporation income tax as against an In dividual Incom. tax that la altogether un answerable. In England after 110 years of experience, th. incom. tax is levied In only exceptional Instances on the individual directly. It Is first leved on th. declared dividends of cor porations; secondly, on rents before theT leave the hands of th. tenants, and finally on th. Individual with respect to matters that ar. not covered by rent, and corporate Investments. N Salary Tax Should Be Low. Another distinction which Is mad. In th. English Jaw and which commends Itself to everyone with a sense of Justice, is that the income tax on passive and permanent In vestments 11k. the stocks and bonds in a corporation, should be hither than on earned Incomes; that Is. incomes earned By the services of the Individual as salary or as a proportional Income. a Karned Incomes thus described ar. really th. proceeds of an application of the capital ef the individual which Is being consumed and will be entirely used up at the end of a professional life of 10 or 30 years, whereas the Incom. from corporat. and business In vestments will continue without regard as to whether th. owner lives or dies and will pass on by succession of law undiminished and without reducing th. capital. This dis tinction Justifies making a difference be tween a tax upon the Income of corporations and that of Individuals where they earn their Income by services, either by roakins the rate leas or hy not taking th. earned Incomes at all. Th. latter Is th. street of th. corporation tax Bond Tax Found Impossible. Another criticism of th corporation tax In the present bill is that only shares of stock In corporate enterprises are thus taxed and that those who own bonds secured by mortgages upon the entire property or plant of the corporation do not pay any tax at all. This is true, and the defect was fu'.Iv recojnitei by those who dratted the corporation tax. They would have been glad. If possloie. to Impose a tax upon the bondholders who ar. only less Interested In the earnings and succkjss of the corporations than are stockholders; but the difficulty of including them and ' of collecting from th. corporation before th. payment of In terest on th. bonds an Incomes tax propor tioned to a percentage of Interest to be paid on th. bonus, was that Congress couid Cot authorise a corporation to recoup Itself In the payment of such a tax from the In terest to be paid, because thu. to Impose a tax on th. bondholder proportioned to the Interest h. received would b. In violation r.f the Constitution as Interpreted by th. Supreme Court, as an incom. tax not appor tioned among the states. Now, if the proposed amendment to th. Constitution passes, authorising th. Impo sition of an Incom. tax without apportion ing It among th. states according to popu litlon. U will be possible to add to our cor poration tax th. feature of Imposing a tax on the bonded Interests In that corporation by a percentage tax upon Interest to be paid, thus reducing th. amount of Interest which the corporation would pay to th. bondholders to the extent of the tax col lected. This would make th. corporation tax a more beneficial measure, and on. reaching Interests that ought to be reached because under the modern system of financ ing corporations, the bondholders and stork holders are- all of them in a sens. Joint investors and a corporation Income tax ought to Include them ail. Corporation Tax Equitable. Vnder th. conditions that existed, with reference to the extent. It seems to me clear that th. corporation tax Is an equitable burden, on. reaching active business, not too heavv to retard It. but enough to eol- lect a substantial revenue from those who tre successful ill business. It is a tax easily collected one that no corporation can escape or In which per lurr c.nnot play any Important rt at all In an effort to escape It. Ar.otner feature of It Is that IncidentaHy It will give the Federal Government op portunity to secure most valuable informa tion In respect to tte conduct of corpora tions, th.ir actual financial conditions which they ar. required to show in general terms In a public return. In addition, th. law provides that means under proper limita tion, an investigation fully and In detail of their course of business. This Is to b. done oniy after th. com mission of Internal Revenue shall have as certained from evidence that their returns "required by Uw ana not correct. Then the evidence which he secures y his Investiga tion, of "book, and papers and examination of witnesses is not to be made public, but Is to be held in the secret archles of the Government until the President .hall deem it of publlo Interest and according to Jus tice to make th. facta known. Corporation Statistics Needed. . fp to this time? w. hav. no adequate statistics concerning our corporations. Even th. stockholders, whatever their right may be to know the course of business of cor nPtlnna am enerellv In a state Of com plete Ignorance and any Instrumentality by t which corporations shall be compelled to i disclose with accuracy a general state- I inent of their conditions certainly makes for the nubile good. indirectly It would I help very much in another tariff revision, whenever that shall come, because corpora tion, encaged in business to be affected by the tariff will hav. upon record In Wash ington their exact financial condition from year to year In th. matter of thoir income, their expenditures and their debta Having said this much with respect to the corporation tax. as it Is, I want to gay a few words In favor of the passage of the Income tax amendment as proposed by Coppress to ths states. Assuming the con stitutional authority to have been given. I am opposed to a goneral Individual Income tax law. except In time, of great National tress. I am opposed to It because of the difficulty already alluded to, that It puts such a premium on perjury as to have led other governments to abandon that method of levying an Income tax and of Imposing th. tax whenever possible on th. sources of Incom. In th. hands of those who ar. not ultimately to pay It. Safeguard From Perjury. Th. instance I hav. already given of an Increase of 100 er cent In the prooeeds of th. tax which was changed from a per sonal tax to on. upon the sources of th. Income, like our corporation tax. Is a most forolbl. argument In favor of th. proposi tion that the Inquisitorial feature of an In come tax levied directly upon th person together with the Inevitable opportunities for escape from th. tax by use of perjury makes It desirable to avoid sue a direct method of levying an income tax. But I am most strongly In favor of adop tion bv the state of th. amendment au thorising Congress to Impose an Incom. tax without apportioning It among th. states according to population; and I am strongly In favor of this because In times of stress of war or If some other calamity wer. to visit hla country and w. should need to strain our resources, the Income tax woold be on. of the essential Instruments by which w. could collect a larg. amount of money to enable n. to meet the exigencies. It has been so In the past, for during the Civil War It was understood that the levy of aa Income tax without apportionment was constitutional, and such a tax was levied and collected. And I consider ft In the Constitution a. at present construed an elemental weakness on the part of the Cen tral Government not to be abl. In times of emergency to levy such a tax. Of course It will be said by those who are opposed to the Income tax that there wVl be . disposition to Impose a direct Incom. tax merely as a means of collecting ordi nary income taxes In normal times, and that no distinction can he made in the Con stitution by which the power to levy such a tax can be limited to the times of emer gency because it is impossible to describe what the emergency should be. I agree with that and I agree that there is a probability that at times the desire to tax accumulated wealth will lead to the movement In favor of a direct Income tax. Rut 1 am also con fident that its Inquisitorial character, and the fact that In time the opportunity for perjury will show It to be so Ineffective In reaching the persons whom it is sought to resch hy a proportionate rate, that it win be found wise to adopt the course taken rn England snd other countries having great experience with such a tax." and to follow the course of our corporation tax rather than by direct personal Imposition, except n great emergencies. If the Income tax amendment passes, as T hope H may. we can then enlarge the corporation tax so as to Include a proper burden on the bondholders In corporations, as well as upon the shareholders, and this will make this Instrument of taxation even more equltnble than it now la Dhose who favor a directly personal In come tax for the purpose of restraining great wealth will probablyflnd it ineffective for the reasons given. Dlvlslon of Great Fortunes. I have already considered In a speech which I made In Columbus In 1907 how our greet fortunes could be divided with out drastic confiscatory methods. It seem to me now. as It did then, that the proper authority to reduce the sire of fortune. 1. the Mate rather than the Central Govern ment. Let the state pas. law. of In heritance which shall require the division of great fortune, between the children of. the decedent, and .hall not permit a multi millionaire to leave hi. fortune in trust so as to keep It In a moss; make much more drastic th. rule against perpetuities which obtain at common law. and then impose a heavy and graduated Inheritance tax which will enable the state to share largely In the proceeds of such large accumulations of wealth, which could hardly have been brought about save through Its protection and Its aid. Ir. this way, gradually but effectively, the concentration of wealth In one hand, or a few handa will be neutralised, and th. dan ger to the Republic, which has boen an ticipated by a continuation through genera tions of such accumulating fortunes, will be obviated. The use 'of the Income tax itself for this purpose will. I think, never be very successful because of the defect already In dicated the difficulty of finding the in come upon which to Impose the tax and the opportunity that perjury will offer to es cape It. An Inheritance tax cannot be thus escaped, becsus. when a man die his prop erty must com. before some court for con sideration and adjudication with a view to lta legal transmission, and therefor, those who are to succeed, however reluotant. must always make a showing of Just what the deceased left In order that they may acquire valid title to the succession. It seems, therefore, that the present Con gress has taken the wisest course In adopt ing aa much of the feature of an income tax as conforms to the Constitution, and by recommending an amendment to tho Con stitution, which shall enable us to round out and perfect this corporation tax so as to make it more equitable, and so as to make It an Instrument of supervision of the corporate wealthy by Federal authority. I doubt not that the information thus ob tained may be made a basis for further leg islation of a regulative character, applicable only to thos. corporations whose business is so largely of an interstate character as to Justify greater restrictions and more di rect suservlslon. TAFT'S REPLY IS AWAITED Undertakers Have Asked President to Address National Gathering. E. E. Erickson, president of the Ore gon State Funeral Director' Associa tion, has not yet heard from President Taft as to whether or not he will be able to address the association during bis visit her. on October 3. Arrange ments are now being completed for holding the National convention here next week. The delegates to the con vention, 400 to 500 In number will ar rive In Portland in a special train next Tuesday night, coming In from Seattle to attend the conveption, which starts the following day. On the two days preceding the Na tional convention will be held hero the Oregon and Washington convention, with about S00 delegates, and these will all take part In the National conven tion, making a total of 'about S00 delegates. TAFT SHOWS YAKIMA FAVOR Announces Desire to Sleet legisla tive Committee in That City. NORTH TAKJMA. Wash., Sept. 21 Special.) L. O. Meigs, speaker of the lower house In the State Legislature, to day received a telegram stating that it was President Taft's desire to meet the legislative committee which would wel come him to Washington, at this city and not at the state line or at Spokane, as previously planned. The message was In reply to one sent by Meigs asking the President's pleasure In this matter. The committee, consist ing of Senators Ruth, Rosenhaupt - and Piper and Representatives Meigs. David. Hubbell and Fancher. will therefore ex tend the greetlne of the state to Taft here on September 23. They will be accompanied by the Gov ernor. t For trunks ro to the Harris Trunk Co. Ski nner s Satin Is the GUARAN TEED lining, the kind that you KNOW is going to last two sea sons or you'll have it replaced. "We 're agents. Black and all col ors, $1.50 vard. Olds 7. rtl l l V V I )i n Ift Ladies' Home Journal for October Here Now At the Pattern or Sta tionery Counter 15 Cents Ladies9 Home Journal Patterns Show Best Fall Styles Always Latest and Best Prices 10 Cents and 15 Cents Sewing Machines Don't think we'll let you forget that we are sole no-ents- for the S T AND ARD line. Join our club and buy on the easy pay ment plan, $5.00 down, tpl.OO a week. Pay $50. 00 Elsewhere Or Only $39.50 Here That's the story of our $39.50 suit in a nutshell. We made an enormous purchase from one of the hest style producers in the New York market and made our own price. Other stores would tell you (and tell you the truth, too,) that thfere was little profit in such suits as these at $50.00. Examine them and compare the quality of most $50.00 suits that you see ; in most cases these are better. They come in plain broadcloths, black or a large va riety of colors, or mannish effects in all wool wor steds. Look where you will, be as earnest as you please in the determination to get the most for your money, and in the end we're sure that in no other place in the Northwest will you find embodied in one suit such splendid style, such good QQQ R( material and such superb value for OuuiJU HORSE SnOW DEVOTEES SHOULD BE PLAN NING THEIR PRETTY FROCKS FOR THIS DRESSY OCCASION NOW. SEE OUR PARIS GOWNS AND BUY IN TIME SO THAT WE'LL HAVE THEM ALTERED .FOR YOU AND READY ON TIME. ; ml, Women's Shoes $3.50 $4-00 and $5-00 the Pair We're enthusiastic enough about the styles and values we offer at these prices, goodness knows, but our customers say' more in their praise every day than we do. Backed by our past experience and capital that en abled us to go to the best shoemakers in the world and take all we wanted of their best product, we've provided a stock of the best medium-priced shoes ever shown in Portland. Style B113, Women's' 12-But-ton Boot, with black cloth top, hand-welt sole, high arch last; decidedly PC Aft smart." .pJiUU Style 170, Women's Gun Metal Shoe, blucher cut, in Royal top pattern, medium ex tension sole, military heel. Price..- $4.09 Style B155, Women's 12-But-ton Shoe, of soft donsrola kid, with medium extension soles, low, broad heels for extreme comfort. PC fin Price OUlUU Style 56, Women's very soft Shoe of dongola, kid lace style, with hand-turned soles and patent tip. For tender feet I t. lltUL J S5.Q0 We have 78 styles in Women's Shoes at ?3.50 We have 60 styles in Women's Shoes at ?4.0O We have 27 styles in Women's Shoes at $5.00 Howd&LeBeau Corsets By all means the best front lacing corsets to be had to day on the American mar ket. We have them ranging in price from $5 to $25, -and our Howd corset at $5 is the superior of any front-lacing corset in Portland sold at $10. The superiority of Howd & Le Beau corsets is apparent at a glance. Their construction ' " completely eliminates nipping or pres sure of the spine, which is so frequent a cause of com plaint in ordinary front-lacing . corsets. Quality and value considered, these are practically the only corsets to choose; we're proud to offer them to our discriminating clientele at from $5 to $25. Gloves -Trimmings Additions to niiladi's toilette, that cost little and mean much. The correctly garbed woman recognizes in these offerings the acme .of quality and authorita tive style. "SVe carry a full line of the, famous Alexandria-made Kid Gloves, perfect in every de tail, from the first treatment of the leather to the finishing touches added by expert work men. Here in all ' Fall shades. Have the best gloves for your new pair, stamped "Alexandria Made." Newest in Embroideries Swiss, nainsook, cambric and ba tiste materials, in edges, bands, galloons, insertions, all-over, baby sets, corset cover embroideries .aihd 17 and 27-inch flouncing. Embroideries of all kinds that stand laundering. Clean, well made goods, especially selected Beautiful New Millinery Portland's most mag aificent millinery stock is on display and easy of access to those who come seeking the unusual and the beautiful in Fall headgear. Three sources are drawn on for the wdndrous sup ply that we present for this season's sell inor "Parns trip; best New York milliners and our own extremely clever de signers. The hats ranged in such plentiful array in our showcases and our millinery counters are marvels of ex clusiveness, originality and clever color blending. Tri umphs of good taste that appeal instantly and irresist ibly to every lover, of feminine finery. We cordially so licit your attendance and inspection Endless Assortment Silk or Wool Dress Fabrics Fancy mixed worsteds for smart tailored suitings, plain-colored broadcloths and kindred fabrics for ultra clever afternoon and calling cos tumes; silks, satins, messalines and evening weights and shades in wool goods. Also taffetas and fancy silks for waists or neat tailored or shirt waist, suits. JAPS PRAISE TAFT Newspapers Give Much Space to Minneapolis Meeting, JUNKET TRIP ' PROPOSED Exchange of Visits Between News paper Men of 'Two Nations Is Advocated by Leading . Japanese Journals. TOKIO, Sept. 22. Th leading- Japanesa newspapers have printed lengthy dis patches about President Taft's meeting at Minneapolis, Minn., last Sunday with the large party of Japanese business men now touring the United State, and qus'te a part of the President's address to the commercial commissioners. Editorials In the Reading dailies com ment favorably upon the meeting, but express regret over the reported hostile attitude of a section of tha American press in the Kast aa well as In theWest. Tha editorials point out, however, that President Taft represents the vast ma jority of people in America and that his expression of friendship must be regarded as sincere and as voicing the real senti ments of Americans. Some of tho most Influential papers urge an exchange of visits between the leading newspaper men of the two countries. NEW ESKIMO TRIBE FOUND Whaler Reports Tall Race, Calling Themselves Xunacotlcs. SAX FRANCISCO, Sept. 21. On board tha whaler Jeanette, which arrived In this port yesterday heavily laden with furs, blubber and tales of the frozen North, was W. J. Bower, an Arctic explorer, who reports the discovery of a new tribe of people neve before seen by the eyes of a white man. Tffls new tribe of Eskimos, according to Bower, live on a point In Prince Albert Land. Bower left this port two years ago on board the ship James Drummond, and has spent the intervening time wandering about among the Eskimos. Unlike the usual type" of Eskimo, the newly discov ered natives, who call themselves Nuna cotics, are very tall and look like North American Indians. The Explorer was cordially welcomed by th strange tribes men and procured many rich furs from them. From the town of Nunacotlcs, Bower proceeded further North, where he dis covered Immense copper deposits. On this trip he lost an eye through the bits of a spider. ' This was not the end of Bower's trou bles, for after the eyeball was removed by the crude surgery of an Eskimo, the schooner used by the party was wrecked and the adventurers had to walk 130 miles to Point Barrow, where they were picked up by the Jeannette. Cab and Perfumery. New York Globe. A man who had hailed a cab was about to step Inside, but one whiff of the In terior made him change his mind. "Drive on," he said. "I'll have to call another cab. My wife would be suing me for di vorce In less than a week If I rode In that rig of yours." The oabman sighed dismally. That's" always the wsy," he said, Vafter I have carried a woman passenger who has had a bottle of perfume spilled over her. For about a week after that I can't get a man, unless he ,is unmar, ried or an Idiot, to ride In this cab. The scent left on the cushions and curtains will cling to his clothes, and all the oaths that could be sworn on all the Bibles ever printed couldn't convince his wife that he ' came by that odor in nocently. "The only thing I can do to keep trade from falliug off Is. to fumigate the cab, tho same as people do when they have smallpox, but even that seems a waste of time and money when you consider how many perfumed people are likely to want to ride Immediately after." Women are ravin over the new prepara tion, called Santlseptlo IOtlon. which Is saia to do wond.rs for the skin and complexion." LIQUOR MN GAIN Wets to Wage Vigorous War fare in Illinois. CAMPAIGN IS MAPPED OUT Retail Liquor Dealers' Association Is Welcomed to Chicago hy Mayor Schnepp and Responses Are Made by the Members. BPRINOFTELD, 111., Sept. XL (Special.) Determination to wage a bitter light against the Antl-Saioon League of Illi nois, on the part of the Illinois Retail Liquor Dealers' Association, was ex pressed by Ernest Knude, of Chicago, president of the association. In his ad dress, delivered at the annual convention, which was opened In Chatterton's Opera House hero today. The theater rang with the cheers of the delegates and visitors when he made this announcement. The convention opened with 331 delegates in attendance, of whom 200 are from Chicago. Mayor Schnepp de livered an address of welcome on behalf of the city and Rudolph. Van Achen, of Peoria, vice-president of the association, made the response. President Knude, Secretary Michael J. McCarthy, of Chi cago, and Treasurer Thomas J. Murray, of Springfield, read their reports. Secretary McCarthy reported a d'ecreasa oflloO In membership since last year, owing to localities voting "dry," but ex pressed the belief that tha liquor inter ests would make a gain at the elections next Spring. The secretary said the con vention would take no action on the Su preme Court election. Boy Descends 30OO Feet, Unhnri. Baltimore News. Oulnter Hell, 12 years old, got entan gled in the ropes of a balloon when It I went up at the fairgrounds In Syra- feet the ballon began to descend and cuse. Ind.. and at an altitude of 3000 I the hoy reacnen rne grounq nniiun. Drawer Operated isteri Cash Reg If you want a drawer operated register let us sell you the best one made at the low- 11 " " i est nrice. All total adders all tape printers. Prices, $50.00 ?65.00 $75.00 $90.00 $10O.00 Detail Adders $30 $40 $50 F. O. B. Factory. $100.00 Total Adder Tape Printer Register From le to T9.i9. National Cash Register Co. Salesroom 70 Third Street, Portland. E. T. Kelley, Sales Agent. All Second-Hand Registers Sold by Us FULLY GUARANTEED