HOW SHALL WE
PAY FOR THE WAR?
A Constructive Criticism on the
House Revenue Bill,
LOANS BETTER THAN TAXES
Five Reasons Why Excessive Taxes l
tin Outset of War Are Disadvantage
out Great Britain Example Worthy
of Emulation How the Taxes Should
De Apportioned,
By EDWIN R. A. 8ELIOMAN,
aii-Vlcknr 1'rofcBsor of Political ICcon
omy, Columbia University.
On Mny 1, 11117, the House of Hop
rosi iit nt Ives msneil mi act "to provide
revunuo to tlofrny war cxpcimt'S nnil
for other purposcH." In the orlRlnnl
lilll iim prcsi'iilcil by the Cominlttce ot
Wiiyn nnil Momm, tlni uililltioniil reve
inn to lie derived wii.h iwtltnutod nt
qiu, IL'0,000. 'J'hu iiiiiciiilniciit (o the In
come lux, which wiim tucked on to tho
bill ilurliiK I lie iIIsciimIoii In the House,
wiim expected to yield nnothcr $ 10,000,.
woo or jr-o.ooo.ooo. ,
In (IIiH'UhmIik; the lloiipy hill, two
prohleiim arlne;
I. How much Mhoiild he ruined by
Uixiitlou?
II. In wlmt iiiniiiier nhoiild thin hiiiii
lie ruined?
I. How Much Should De Raited by
Taxation?
How wiim the IlKUre of $1,800,000,000
arrived nt? The nimwerlH nlniilt. When
tho KiH'retiiry of the Treasury emtio to
OHlliiiute the nddltloiiul war expeiiNm
fur the year ItllT-lH, ho culculuteil thut
they would uinmint tu home ftl.OM),.
OOO.iMXi. of which :1,000,0X),000 wiih to
he iillollud to the ullleK. mid $:i.l'00,
000.000 wiim to liu utilized for the do
iiimtlt! purposoH. Thinking thut It
would he a fair propoNltlen to divide
thin latter hiiiii between Iouiih and
tnxiw, ho 'oueltided that the amount
to bo ralried by taxeH wiim H.MtO.WMl,-
Thent ure two extreme theories, euch
of wlilcli may bo dlxmlxNcd with wiuit
eourti.y. The one Im that all war ex
lieiidltureM nIioiiM he defrayed by Ion in,
mid the other U thut all war eipcndl
turr xhoiild be defrayed by tux cm.
Kneli theory In untenable,
It In Indeed true that tho bunlciiM of
the war Nhotild be borne by the pre
eut nither than the future Kcncrutlon;
but tlilMilocHiiot mean thut they whould
be borne by thin yeurV tuxiitlon.
.MvetliiK all warexpeimeH by I unit Ion
iniikon the taxpayerH In one or two
yeura Ikiit the burden of hciii'lltx thut
outsht to be distributed at leaNt over a
deeude within the miiiio irenerntlou.
In Hie ni'coiiil place, when expend),
turew appmiieli tho Kluantic hiiiiih of
preentHlay wnrfure, the Uiouly iiol
ley would require iiihih Uiau tho total
NiirpliiM of hik'IiiI lueoiue. Were this
iihrtolufely lie iNiny, the eiiMilin,- tin v
oo In tin eeoiiomlc life of the coinmuub
ly would liuve to bo endured. Hut
where the dlniiMlent are ho urent and
nt J be winie tlmo mi liniiecesHiiry, the
tiu-inily policy may lie neciareii im
prHclleMble.
KrrHHry .MeAdoo hud Hie rlht In
Mliwt nml bmbly couiiueiidable roup
nm In decldliiK that u HUlwIiintbil por
HiHi. ut leuat, of Hie revenues hIioiiUI
bo dertvetl from laxiitloii. Hut whet)
ho hit iiui the pluri of Wl-flO per cent.,
tlwt I, of nilahiK one-half of all do
lunatic war expuiidlluroN by tux en, the
iuotlou urlneH whether he did not kc
too far.
Tiio relative proportion of Iouiih to
luveg In after all u purely busliiesa
propollloii. Not to rely to a hirno ex
tent on loam at the niiUct of u war Is
a mlaluko.
DUadvanUae. of Cxeesslve Taxet.
l'h tlbxiilvitntiiKiT. of oncomIvo luxen
ut the (Milwt of Hie war are us follows:
1. l!iceautlrt Ihxih mi inusilinptlou
Will ohum popular iweiituieiit.
St. lSxitrive tuxiw on tiidustry will
dlimrraiute Imslm, (lump iiitliiishiiu
mul iiwtrlot tlio Hplrit of enterprise at
lb very time when Hie opiMudto Is
iievilwl.
St. lluwrth e laved on IneouieM will de
tMt the surplus available for Invent
motdn uih! luterfero with the pluului: of
the vworimMM Iivuiim whtub wilt bo mves
wiry In any event.
I. lCxvtiMlve luxin ou wealth will
SIMM u erIoiiM diminution of the In-
etWMM which aio at present larcely
drawu Uhhi for the mippnit of educu
tkwal hwI' philanthropic enterpriser,
itm-ettver. tluwo nouires of mippnrt
wuuld Im) tlrltl up prwlsoly at the time
when (he need would bo Kreutest.
5. Excessive taxation at the outlet of
tho war will reduce the elasticity avail
able for the increaiing demandi that
are soon to come.
Great Oritaln'e Policy,
Tnla limit Hrltutu us uu example.
DuriiiK the Unit year of the war stir
liieimuml taxeH only slluhtly, In order
to kmtp ludiuitiies koIiik at top noteb.
DuriiiK the Kccoud year hIiu ruUed by
iir luxes only U per cent, of her wur
oxuMMlttiiroN. DuriiiK the third year
ulio lvWd by Mddltlouul tuxes (over
unj above tho pro-war level) only
Klif fatly more than IT per rent, of her
wur espouses.
If we Mtiould attempt to do us mutti
lu tho Hint year of the wur as (Ireut
lli'lliilu did In the third yeur It would
KUlttt'o to hum by taxation $1. 1:50,000..
ooq. If, tu order to bo nbsulutely on
the wife side, It seemed advisable to
lucre tho biui to $l.r00.000.000, this
sUauW. In our opinion, bo tho wall,
luuui.
REVIEW'S LEGAL BLANKS
The following list of legal blanks
nre kept for sale at this office and
others will be added as the demand
arises;
Warranty deeds, Quit Claim
Deeds, Realty and Chattel Mort
uugos, Satisfaction of Mortgages,
Contracts for Sale of Realty, Hills
of Sale, Leastis.
Neta th UU1 tn eur gB4f,
In considering the apportionment of
the extraordinary burden of taxes In
war times certain scientific principles
are definitely established:
How Taxes Should Be Apportioned.
(1) 7he burden of tweca inut he
spread as far an possible over the
whole community so as to cause each
Individual to share In the sacrifices ac
cording to his abltyp to pay and ac
cording to his shared the. Government.
(2) Taxes nu consumption, which arc
necessarily borne by the community at
InrRc, nhould be Imposed us far as pos
sible on articles of quast-luxury rather
than on those of necessity.
(3) Excises should he imposed as far
an possible upon commodities In the
hands of the final consumer rather
than upon the articles which serve pri
roarlly as raw material for further
production.
H) Taxes upon business should he
Imposed as far as possible upon net
carnhiKs rather than upon gross re
eclpts or capital Invested.
(0) Taxes Upon Income which will
necessarily bo novcre should lie both
differentiated and Kradunted, That Is
there should be a distinction between
earned and unearned Incomes and there
should be a higher into upon the larger
Incomes. It Is essential, however, not
tu make the Income rate ho excessive
us to lead to evasion, administrative
dllllciiltles, or to the more fundamental
objections which have hern urced
above.
(0) The excess prollts which are due
to tho war constitute the most obvious
nnd reasonable source of revenue dur
lug war times. Hut the principle upon
which these war-prolll taxes arc luld
must ho equitable In theory and easily
culculuhtc In practice.
The Proposed Income Tax.
The additional Income tux us passed
by the House runs up to a rate of i
per cent. This Is n hiiiii unheard of In
the history of civilized society. It must
he remembered that It was only after
the first year of the war that Hreat
Ilrltalu Increased tier Income tux to tho
maximum of nt per rent., and that
even now In the fourth year of the war
the Income tax does not exceed -t-!!i
Iter eeiit.
It could easily le shown that u tax
with rules on moderate Incomes sub
atiiutlnlty less than In Oient Ilrltalu.
and on (he larger Incomes ubout as
high, would yield only slightly less than
Hie .:r.,l0(X),(X)0 orlglimlly estimated In
the House bill.
It Is to be hoped that the Hetiute will
reduce the total rale on the highest In
comes (o ill 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
come tax, Oy Imposing excessive rates
now we are not only endangering the
future, but are Inviting all manner of
difficulties which even Oreat Drltaln
has been able to escape.
Conclusion,
The House hill contains other funtln.
mental dcfcctH which may bo summed
up as follows:
(1 ) It pursues nu erroneous principle
In Imposing retroactive taxes.
(U) It selects un unjust and uuwork
able criterion for Hut excess-profits tax
CD It proceeds to an uuheiird-of
height In the Income tax.
(I) It lniMseH unwarranted burdens
upon the consumption of the conimii
ulty.
(f) It Is calculated to throw business
Into eon fusion by levying tuxes on gros
receipts lusteud of iiihhi commodities.
(Ill It fulls to make u proper uso of
stump tuxes.
(7) It follows tin unwleutlllc system
tu Its Hut rule on Imports.
(S) It Includes u multiplicity of m(
ty and iiulticratlve taxes, the vexatious
u ess of which Is out of all proportion to
the revenue they prixluce.
Tho fundamental Hues on which tho
House bill should bo modlllcd ure sum
med up herewith:
(1) The amount of new luxation
should bo limited to ,'J50.(KX).(K)0-or
at the outset lo $l,WX),()00.00. To do
morn thuu this would bo as unwise as
It Is unnecessary To do eveu this
would bo to do more than bus ever
own dono by any rlvllUed (Jovprn-
incut In time of stress,
(-) The excess-profits tux bused upon
it uouud system ought tu yield ubout
fr.ix,oiK),ooo.
(II) The Income tux schedule ought to
be revised with a lowering of tho rates
on earned Incomes below $10,000, and
with an analogous lowering of the
rates on the higher Incomes, so iim not
lo exceed 31 per cent. A careful cul
dilation shows that an Income tax of
this kind would yield some X 150,000,
000 nddltloiiul.
N) Tlie tax on whisky mid tobacco
ought to remain approximately as It Is,
wltli a yield of ubout I'-'M.OyXMMW.
Thene three tuxes, together with the
stump tux at eveu tho low ruto of the
House bill, and with an Improved ail
tomoblle tax, will yield over $1,250.
000.000, which Is the amount of money
thought desirable.
The above program would be In liar-
moiiy with an unproved scientific ays
Com. It will do uway with ulinost all
of the complulnts 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 wilt not go to the
extremes of conllscutlou. It will ob
viate Interference with business and
will keep unimpaired the social pro
ductlvlty ef the community.
It will establish a Just balance be.
tween loans ami taxes and will not
succumb to the danger of approaching
either tho tax-only policy or the loan
only policy. Above all, It will keep an
undisturbed elastic margin, which
must be iu'.re and more heavily drawn
upon as tba war proceeds.
At the pace some people pur
sue happiness it would take
them a hundred years to cret
across their back yard,
The Portland Garbairo Co. is
prepared to remove rubbish of
any nature from tho residences
and business places of St. Johns
at 75c per month for residences
and from business places at
reasonable rates. Calls made
every baturday. Leave orders
at St. Johns Hardware, or phono
woodlawn WW.
A Newest Creation
p McCitl,
Draped Styles Ajrnin in Vojrue
Try A Cup
OF COFFEE
Made With One Of These
New Electric
Percolators
After one trial you'll
be ready to
THROW AWAY
The Old
COFFEE POT
Call and see our new
display of these Elec
tric Percolators.
PRICKS MODltRATK
ELECTRIC STORE
Electric BulldliuJ
Notice to Creditors
In the County Court of the
State of Oregon, (or the County
of Multnomah. In tho Matter
of the Estate of J. II. Fletcher,
deceased: Notico is hereby
(riven that I, John Hamilton
Fletcher, have been duly ap
pointed executor of the will of
J. H. Klotcher, deceased, by
Honorable George Tazwell,
County Judge of Multnomah
County, Oregon, and have
qualified.
All persons having claims
against said decedent, or his
estate, nre hereby directed to
present the same to me verified
in tho manner required by law,
at tho ofllce of George J. Per
kins. 1117 Hoard of Trade
Building, Portland, Oregon,
within six months from tho
date of the first publication of
this notice,,
John Hamilton Fletcher,
Executor.
Georgo J. Perkins,
Attorney for Executor.
Date of first publication July
13. 1917. Date of last publica
tion, August, 10, 1017.
J. R. WEIMER
Transfer and Storage
We deliver your roods to and from
all pc7ta of Portland. Vancouver. Linn
too, Portland and Suburban Expreet
Ce., city dock and all points aocesalbla
key vasTW Mom nel tmnkuru atevta
John Poff
J. II Harvey
Wilcox Transfer Go.
Phone Columbia 30S
06 N, Jersey St. Johns, Ore.
Deafness Cannot De Cured
by loc.l uppllcttloii., at they canuoi rwich
UUrm.ra porlwn ol I no rer rnr it
only out way to curt ilmintM. and that It
cy coniiiluuonai rcmruira iinrtt it
caui.d by an InrtainrU cvndltlon ot til mil
coua llnlnc of III. Kutuclilan Tul Wh.ii
Ihlt lulw It mrumrtl you have a rurnb Inc
.nun J or Imixrfrct hrarlnir, and hn It la
ntlrrly clotnt, 1(IU' It Ih. rrtult. and
unlraa the Inrlaminatlon can b takrn out
and thlt tub rmorrU to lit normal condi
tion. h.arliK vlll b d.ttroyrd lor.v.r; nln.
raara out of t.n ara cau.rd br I'alarrh.
which It nothlRf tut an Inrlamcd condition
ot tha niucou. turfac.a.
We will zlv One llundrrd Iwllara Cor any
cat of lafn. (caud by catarrh) that
cannot b cured by llaH'a Catarrh Curt.
tlrnd for circular., ft...
K. J CIlKNKV A Ca, Toltdo, Ohio.
Hold by Uruiil.i.. p
Takt Uall't V.rally fill, tor conttlpatlon.
Howard 0. Uocers. Lawyer.
Notary Public. Over Peninsula
lank; 7 to 9 P. M.
Suspicion ia defined by the
erdict of a western Jury:
'Guilty, with soma little doubt
as to whether ho is tho man."
VP
! ' ft)) a
I a a a a Sc a
I
L
LAUREL LODGE
No. 186 I. O. 0. r
ST. JOHNS, OHCGON
MeU each Monday evonlnif In Odd lrel
loa hall at 8:00. A corillal welcome tn
all villlliiL' brothers.
Harry VimW, Nol.lt fltenit
U. M. Neirnr. Vice (trend
n, 1. Iliirimiiili., I'ln. rwc.
II. 1'. Cl.ilkTitt,
St. Johns Gamp No. 7546
Modern Woodmen of America.
Vi linnrt ilv solicit tha attend
mice of our members nt our next
rcKiiInrmectliur. Tluiradny, auk
Otii. G. W. Mulim, Consul.
Milk and Gream Direct
From the Cows
I
2
i
2
2
s
2
IHUJV.UUC1J tsuu j
J. II. WINDLE, Prop.
I
f Phone Col, 320
ntltvtrtrl rhllr
-I
Offices and Rooms
$8.00 per month and up
PENINSULA NATIONAL BANK BLDG.
Building remodeled and rooms
modern in every respect
including steam heat
Best Located Rooms In the City
Apply IS. R. MORRIS
Peninsula Nutional Hank
Notice of Sale Under Ware
houseman's Lien
Notice is hereby given that Peninsula
iron works lias safely kept, atoreil anil
warenoiiseii in us mctory, Alia mm nr.ui
foril ktreets. St. Johns, Portland, Oregon,
35 Oregon l'ruit Cleaning ami ('.railing
machines continuously since January,
191 1, ut the it'tpicst of Oregon l'ruit
Cleaner Co., owner or reputed owner ami
lawful possessor of said property. That
the just ami reasonable charges for the
storage of Mid property (rum Jauuarv,
iyi-1, to April I. I'JVi, is HMi.w, wiiicii
sum, or any tiart ttiereof. has not been
paiil. although (uiyiueut has often been
ileuiamleil of sanl owner. That Peninsu
la Iron Works acquired, and uow has, a
warehouseman's lieu on said property
for storing saute since January, 1914,
which on April 1, 1917, amounted to
said sum of S14SG.00. and for storage ac
cruing since April 1, 1917, ami it will, on
Saturday, August 4, 1917. at 10 o'clock
a. in., at its factory, Alta and Bradford
streets, St. Johns. Portland, Oregon, sell.
to the highest bidder for cash, all said
fruit cleaning and grading machines, or
so many thereof as may be necessary to
mv storage cuarges inereoii to Aprii'i,
9i7. and wilt apply the proceeds of
such sale to uie payment oi sain storage
charges and the expeusc of said sale.
Uuteil July 10, )917.
PUNINSUI.A IRON WORKS.
Lien Clnitpaut.
Howard 0. liocers. Lawyer.
Notary Public. Over Peninsula
National Bank: 7 to 9 P. M.
) Baa ill ScllSe
THE REMARK "I saw this same thing at a price .
below your mark at such and such a store over town is
rarely heard in our store. This is just as it should be and
we expect to keep right on showing bargains obtained at
cash prices and giving our customers the benefit; that, too,
is as it should be. Our rent is less, our personal expense
moderate, our stock turns frequently the only profitable
way of merchandising.
Your Swimming Suit is in our window, $1.00 to $4.50 .
per suit.
BONHAM
L. E. ROSE Mgr.
For a Real
zn
NORTH
BEACH
Is the Place to Go
Reached by Rail or Steamer
ROUND -TR.IP FARES
Week-end . . . $3.00 To All
SixMonths. . . $4.00 gjf
5'trip Tickets, $ 1 5.00 Points
RAIL Tickets and Information at S ,1', & S, Station
E!c entli ami Ho t t-Ucf u. Trains leave t.ii
. ara.j..iy,J.0Oum. SJIuriljy..
STL'AMLIl-Uvr AintMorth Dock dock 8.00 p.m.
daily except burulay.
Tickets, rtsmatious. and a "NORTJl DEACWfoldtrat
UNION PACIFIC SYSTEM
City Ticket Office, Third and Washington; Iiroadu ay JSOO, A-GJS1
Wm. lliMurr.jr, Oturul 'uua.r A(at, fiinltuj .
HcCall 1'altrrna WilM
No. 77. ltt Nu n 7.
tlaoyutber new tlcsieut
..The Pasi Time Billiard Hall.,
N. I. W1UTK froprletor
The Place Where They All Go
A Choice Line of Cigars, Tobac
co and Soft Drinks
WHERK THE CAR STOPS
The Values
Wc arc giving now arc a
pulling power that pro
duces daily increase of
& CURRIER
Toggery Dept.
Rest
IIOLMES LODGE NO. 101 1
KNICIITS Or PYIHIAS I
On Vacation Until Fri
day Evening, Sept. 7
v. R. evens, c c.
A. CAR&NELSON, K.R, S
, r-aS.1. tlsr.
IJt W Bl.u il
i
I
Mitt 'Wm
W!0& Mill
Skirt
llcCall rattern No. 7?T.
Uaay oilier allractlc
DORIC LODGE NO. 132
A. r and A. M.
Meets the first nml ttilr.1
Wednesday of each month
in Uickner's Hall. Vlsi-
tort Vflmtnft
asw Vr3
-m iv-v7
J. N. Edlefsen W. M.
A, W. 0vU, Secretary,