La Grande evening observer., June 19, 1917, Image 8

TUESDAY, JUNE 19, 1917.
GRANDE EVENING OBSERVER
EIGHT
L
.i'K
i
r
Defy the Heat
With a Daily Bath
' Nature has provided our bodies with a cooling sys
tem that safeguards us against summer's heat.
The perspiration flows from the pores of the skin
-, and is evaporated upon the surface. But for the
cooling system to work effectively the pores of the
' skin must be kept open. A daily bath will keep
the skin in a vigorous healthy condition and the
pores active. We handle all of the up-to-date
Bath Accessories
which may be needed in making the bath luxuri
ous and healthful Bath Brushes, Sponges, Rub
ber Sponges, Bath. Soaps, Bath Tablets, Sea Salt,
"'Toilet Waters, Talcum Powders, Bath Sprays, Etc.
A full equipment will cost but little.
Make your selections now.
La Grande Pharmacy
ADOLPH NEW LIN, Manager
Quick Delivery Phone Mate 41
' La Grande, Oregon
NOW SHALL WE
j PAY FOR THE WAR?
'A Constructive Criticism on the
House Revenue Bill.
LOANS BETTER THAN TAXES
Fivs Rations Why Exoassiv Taxes at
i iha Outsat of War Are Disadvantags
' eua Great Britain Example Worthy
of Emulation How the Taxes Should
Be Apportioned.
By EDWIN R. A. 6ELIGMAN,
McVlckar Profesaor of Political Econ
omy, Columbia University.
I On May 23, 1017, the House of Rep
resentatives passed nil act "to provide
revenue to defray war expenses and
for other purposes." In the original
iilU'as presented by the Committee of
iWays and Means, the additional reve
nue to be derived was estimated at $1,-810.420,000.'-
Tho amendment to the In
come tax, which was tacked on to the
bill during the discussion in the House,
, "was expected to yield another $10,000,.
00 or $50,000,000.
In discussing the House bill, two
problems arLio:
I, How much, should be raised by
ta ration?
ii. In what mnnncr should this sura
be Wised?
I. flow Much Should B Raised by
Taxation7
i How was the lluro of $1,800,000,000
hrrij ed at? The answer Is simple. When
the Secretary of tho Treasury came to
estimate the additional war expenses
for lhe year 1017-1S, ho calculrd that
tucyj would amount to some $0.(SOO,
000,R), of which $3,0K.000,00 was to
bo Allotted to the allies, and $3,OUi,.
00.000 was to be utilized for the do
mestic purposes. Thinking Hint it
woultl bo a fnlr proposition to divide
this .jlntter sum between loans and
taxos ho concluded that the amount
to bolrulsed by taxes was $1,800,000,
000. ,
ThoJ-o are two extreme theories, each
.of wllch mny ho dismissed with scant
courtyy. Tho one is Hint nil war ex
Iieiidl lines should lie defrayed by loans,
and tile other is Hint nil war expeudi
tures Ishouid be defrayed by taxes.
Each theory is untenable.
It is'lndeed ti'tlo that the lnmU ;i ..
the wiir should be borne by the res
ent rnilier tlian the future ccui-ratiou.
but thfr does not mean that tliev kIiohM
lie borljo by this yem'H tnxmii u.
Meetjng nil war expenses by taxatiun
. makes 'the taxpayers in one or two
years boar the burden of benefits tl.i.t
Ought fb lie distributed at least over i.
decade iwltliln the same generation.
In the second place, when expendi
tures approach the gigantic sum or
present-May warfure, the tax-only pel
toy woiAd require more than the totui
surplus of social Income.' Were tU.
absolute- ueeessary. the ensuing lia
oc in Mid economic life of tlie commuui
ty would have to be endured. Hut
where the disasters are so great and
Jit the xiiiiie time so unnecessary, the
Max-only , policy may be declared Impracticable.
Secretary McAdoo had the right in
stinct and highly commendable cour
age in deciding that a substantial por
tion, at least, of the revenues should
be derived from taxation. But when
he bit upon the plan of 00-50 per cent,
that is, of raising one-half of all do
mestic war expenditures by taxes, the
question arises whether he did not go
too far.
The relative proportion of loans to
taxes Is after all a purely business
proposition. Not to rely to a lurge ex
tent on loans at the outset of a war Is
a mistake.
Disadvantages of Excessive Taxss.
The disadvantages of, xcesslve taxes
at the outset of the war are as follows :
1. Excessive taxes on consumption
will cause popular resentment.
2. Excessive taxes on industry will
disarrange business, damp enthusiasm
and restrict the spirit of enterprise at
tho very time when tho opposite is
needed.
3. Excessive taxes on incomes will de
plete the surplus availuble for invest
ments and Interfere with tho placing of
the enormous loans which will be neces
sary In any event.
4. Excessive taxes on wealth wll)
cause a serious diminution of the in
comes which are at present largely
drawn upon for the support of educa
tional und philanthropic enterprises.
Moreover, these sources of .support
would be dried "up precisely at tho time
when tlie need would be greatest.
5. Excessive taxation at the outset of
the war will reduce the elasticity avail
able for the increasing demands that
are Voon to come.
Great Britain's Policy.
Take Great Iiritalu as an example.
During the first year of tlie war she
Increased taxes only slightly, in order
to keep industries going at top notch.
During the second year she raised by
new taxes only it per cent, of her war
expenditures. During the third year
she levied by additional taxes (over
and above the pre-war level) only
slightly more than 17 per cent, of her
war expenses.
if we should attempt to do as much
in the first year of the war ns Grent
Britain did in the third year it would
sulllce to raise by taxation $1,250,000,
000. If, in order to be absolutely on
tlie safe side, it seemed advisable to
increase the sum to $1,500,000,000, this
should, in our oplulon, bo the maxi
mum. In considering the apportionment -of
the extraordinary burden of tnies in
war times certain sclent itlo principles
are detlnitelv established:
How Taxss Should Be Apportioned.
(1) The burden of tixces must be
spread us far us possible over tho
whole community so as to cause each
individual to share in the sacrifices ac
cording to his ability to pay and ac
cording to bis share in the Uovernment
I'Ji 'Taxes on consumption, which are
necessarily l.oine by the community at
large, should be iiiiHised as far as pos
sible on nrtieles of ipiasl-luxury rather
than on those of necessity.
(3 Excises should lie imposed as far
as possible upon commodities in the
hands of the final consumer rather
than upon the articles which serve pri
marily as raw material for further
production.
Hi Taxes upon business should be
Imposed as far as posslblo upon net
earnings rather than upon gross re
ceipts or capital1 invested.
(5) Taxes npon income which will
necessarily bo 6QVcrc should b.0 both
differentufted and RraduatedT That Is.
there should be a distinction between
earned and unearned Incomes and there
should be a higher rate upon the larger
incomes. It is essential, however, not
to make the income rate so excesslvo
as to lead to evasion, administrative
difficulties, or to the more fundamental
objections which have been urged
above.
(d) The excess profits which are due
to the war constitute the most obvious
and reasonable source of revenue dur
ing war times. But the principle upon
which these war-proflt taxes are laid
must be equitable in theory and easily
calculable In practice.
The Proposed Income Tax.
The additional Income tax as passed
by the House runs up to a rate of CO
per cent. This is a sum unheard of In
the history of civilized society. It must
be remembered that It was only after
the first year of the war that Great
Britain increased her income tax to the
maximum of 34 per cent., and that
even now In the fourth year of the war
the Income tax does not exceed 42Mi
per cent.
It could easily be shown thnt a tax
with rates on moderate incomes sub
stantially less than in Great Britain,
and on the larger Incomes about as
high, would yield only slightly less than
the $532,000,000 originally estimated in
the House bill.
It is to be hoped that the Senate will
reduce tho total rate on the highest in
comes to 34 per cent, or at most to 40
per cent, and that at the same time it
will reduce the rate on the smaller in
comes derived from personal or profes
sional earnings.
If the war continues we shall have to
depend more and more upon the in-
i come tax. By imposing excessive rates
now we are not only endangering the
future, but are inviting all manner of
difficulties which even Great Britain
has been able to escape.
Conclusion.
Tho House bill contains other funda-
i mental defects which may be summed
up as follows:
(1) It pursues an erroneous principle
in imposing retroactive taxes.
(2) It selects an unjust and unwork
able criterion for the excess-profits tax.
(3) It proceeds to an unheard-of
height in the income tax. -
(4) It Imposes unwarranted burdens
upon the consumption of the commu
nity. (5) It Is calculated to throw business
Into confusion by levying taxes on gross
receipts instead of upon commodities.
(6) It falls to make a proper use of
stamp taxes.
(7) It follows an unscientific system
in its fiat rate on imports.
(8) It includes a multiplicity of pet
ty and unlucrative taxes, the vexatlous
ness of which is out of all proportion to
the revenue they produce.
The fundamental lines on which the
House bill should be modified are sum
med up herewith:
(1) The amount of new taxation
should be limited to $1,250,000,000 or
at the outset to $1,500,000,000. To do
more than this would.be as unwise as
it is unnecessary. To do even this
would be to do more than has ever
been done by any civilized Govern
ment in time of stress.
(2) The excess-profits tax based upon
a sound system ought to yield about
$500,000,000.
(3) Tho income-tax schedule ought to
be revised with a lowering of the rates
on earned Incomes below $10,000, and
with an analogous lowering of the
rates on the higher Incomes, so as not
to exceed 34 per cent. A careful cal
culation shows that an income tax of
this kind would yield some $150,000,
000 additional.
(4) The tax on whisky and Jobaeeo
ought to remain approximately ns It is,
with a yield of about $230,000,000.
These three taxes, together with the
stamp tax at even the low rate of the
House bill, and with an improved au
tomobile tax. will yield over $1,250,
000,000, which is ttio amount of money
thought desirable.
The above program would be in bar.
mony with an approved scientific sys
tem. It will do away with almost all
of the complaints that are being urged
against the present. It will refrain
from taxing the consumption of the
! poor.
It will throw a far heavier burden
upon the rich, but will not go to the
extremes of confiscation. It will ob
vlnto interference with business and
will keep unimpaired tho social pro
ductivity of the community.
It will establish a just balance be
tween loans and taxes and will not
succumb to the danger of approaching
cither tho tax-only policy or the loan
only policy. Above all, It will keep an
undisturbed elastic margin, which
must be more and more heavily drawn
upon as the war proceeds.
Announcements
SEAT SALE STARTS TOMORROW
Tomorrow the seats will go on sale
for D. W. Griffith's latest spectacle,
"Intolerance," the attraction for Sat
urday and Sunday . at the Arcade.
None of the scats for the matinees
will be reserved but all the seats for
each evening performance will be re
served. Nothing comparable to this produc
tion in size, novelty and entertaining
qualities ever has been shown upon
any stage, it is said. Amazing mag
nitude and oven more amazing detail,
a revolutionary method of presenting
four stones almost simultaneously.
and the most gigantic settings ever
erected for a theatrical production,
are some of the most impressive fea
tures of this spectacle. So interesting
and important is its theme, love's
1 Our Never 'Changing Policy-
You buy your wearing apparel now at exactly th&same price at which you can
buy it later or at the end of the season We NEVER make a reduction
simply because we NEVER at the opening of the season ADD anything that
will be later deducted.
Men's Work Shirts
Men's Sport Shirts ,all
Men's Work Pants
Men's Dress Shoes
Men's Dress Shirts
Men's Summer Unions
Men's Summer Cloth Hats .
Men's Summer Hose
Men's Dress Suspenders
Men's Work Gloves
New Arrival of Straw
THE
STORE
WHERE
THE
MASSES
TRADE
struggle throughout the ages, that
prominent newspapers throughoutthe
country have discussed it and praised
it editorially.
Six months at the Liberty theatre,
New York, and long runs in Chicago,
Philadelphia, San Francisco, Lo; An
geles and Pittsburg, testify to the
popularity of this new creation.
Teachers' Examinations.
Notice is hereby given that the
County Superintendent of Union
Couniy, Oregon, will hold the regular
examination of applicants for State
Certificates at La Grande High
School as follows:
i Commencing Wednesday, June 27,
1917, at 9:00 a. m., and continuing un
til Saturday, Juno 30, 1917, at 4:00
o'clock p. m.
Wednesday Forenoon.
,U. S. History, Writing, (Penman
ship), Music, Drawing.
Wednesday Afternoon.
.Physiology, Reading, Manual
Training, Composition, Domestic
Science, Methods in Reading, Course
of Study for Drawing, Methods in
Arithmetic.
.:, Thnrsday Forenoon. '
Arithmetic, History of Education,
Psychology, Methods in Geography,
Mechanical Drawing, Domestic Art,
Course of Study for Domestic Art.
Thursday Afternoon.
Grammar, Geography, Stenography,
American Literature, Physics, Type
writing, Methods in Language, Thesis
for Primary Certificate.
Friday Forenoon.
Theory and Practice, Orthography,
(Spelling), Physical Geography, Eng
lish Literature, Chemistry, Physical
Culture.
Friday Afternoon.
School Law, Geology, Algebra, Civil
Government.
Saturday Forenoon.
Geometry, Botany.
Saturday Afternoon.
General History, Bookkeeping.
Very truly yours,
J. A. CHURCHIXL,
Superintendent of Public Instruction.
Adv. June H-10t.
Fnneral Notice.
The funeral of Mrs. March will be
held from the Henry chapel to
morrow afternoon at 2 o'clock, Rev.
J. W. Oliver officiating.
FOR SALE Farm.
FOR SALE 440 acre stock and tim
othy ranch, one of the best Tanches
in Eastern Oregon. Brand new
house, barn, chicken house ana ma
chine shed; finest spring water
piped to house and barn. One mile
from store and sehoolhouse. Rail
road runs along the east line of
place. Will pay 10 per cent on
$30,000. Will consider part trade,
balance at your own time at 7 per
cent, unlimited outside Tang at
least $10,000 worth of wood and
saw timber on place. For price
particulars see Chas. O. Braham,
next to Curroy press or write Box
G57, La Grande, Oregon. Adv.
6-19-tf.
LOST A baby's tatted hood. Re
turn to Observer. Adv. 6-19-2t
COMPANY M BOYS
GOING TO DANCE AT UNION
The Union Livestock association is
giving a banquet and dance to Com
pany M tomorrow night and are com
ing over for them in autos. The sol
dier boys will be guests. Tlie publh
is invited. There will be a eharce fn
tho latter the proceeds going to '.he
Red Cross.
NEW TODAY
in i--ifi ifi
colors
.
Hats
19c,
Vv:
Foimerly The United Store
X
The Hug Grocery Store of La Grande Is the
Agent for Our Fancy Carton Butter
WATCH THIS SPACE
ELGIN CREAMERY
K
Forest Rangers Meet,
Portland, Ore., Juno 19. (Special)
State forest rangers, in session here
today, are discussing lire prevention
methods. Similar meetings will be
held at Newport tomorrow and Mar
cus June 21.
J The Observer Wild Animal Prize Contest. $
J To the Wild Animal Editor:
4 I hereby certify I am not over 15 years of age and I submit
4 names of wild animals in your prize contest for 4
free tickets to the Al G. Barnes Big Four Ring Wild Animal Circus,
exhibiting in La Grande, June 26. 4
4 Name J
4 Address '. 4
4
(Pin one of these coupons on your list)
We have installed a Hoffman Sanitary Steam
Pressing Machine to take care of your clothes.
, One Trial Is All We Ask
Come In and Let Us Show You How the Machine
Works
Wilson Brothers .
Ladies' and Men's Tailors
Hats Cleaned and Blocked
New Foley Bldg.
K44X
Did You Say Oil
Stoves
Well then if you want an Oil Stove and want to
Save Money on it, come across the track and teach
your dollars to have more sense.
HARRIS FITRNITI TDF rn
Arrnfua iht Tralr
.... -
KjT.s.s.N
-69c, 75c, 98c, $1.49
..49c, 59c, 98c, $1.49
...$1.69, $1.98, $2.49, $2.98
:$2.98, $3.50, $4.50, $4.98, $5.50
..98c, 1.49, $1.98, $2.98
49c, 98c, $1.25, $1.49, $1.98
... 39c, 49c, 69c
.15c, 25c, 49c
25c, 49c
....98c, $1.25, $1.49, $1.98
25c, 49c, 98c, $1.49, $1.98
FOLLOW
THE
CROWDS
THERE'S
A .
REASON
x
FOR SALE OR TRADE Horses.
FOR SALE OR TRADE Horses,
1707 Jefferson Ave. Adv. 6-19-3t.
Hose Company Meets Tonight.
Regular meeting Rescue Hose Co.
tonight.
P. A. FOLEY, Captain.
Phone B 1761
tt - .
n. a. narns, n
tt