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PAGE TWO
TOWNSEND PLAN IS ANALYZED
BY SOCIAL SECURITY AUTHORITY
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| Robert Earl Clements
e
An economist of nationwide
fame, Dr, Edwin T. Witte, pro
fessor of economics at Wiscon
gin University, here presents
an analysis of the Townsend
Plan, taking up every phase of
the program which its origina
tor contends will bring nation
al recovery and security to the
aged. Professor Witte was co
author of Wisconsin's job in
surance law, first state act of
its kind put in operation In the
U. 8. and and was called to
Washington by President Roo
sevelt to draft the national job
ingurance plan.
BY EDWIN E, WITTE
Professor of Economics University
of Wisconsin
The majority of the people who
gupport the Townsend plan look
upon it as an old-age pension pro
posal, Dr, Townsend himself, how
ever, has repeatedly stated that it
ig in its essence a recovery plan,
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IR
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b
LOSSES
~ oOld Way
i STRING BEANS . 39%
CARROTS . . , . 4%
CABBAGE . . . . 41%
2 E .R G IL.& PO W EDR COMUPANY
EASTERN EDITION
' ik
.._..:::::.:.-.'.::*:-.:e.;-.m::.:‘.:._.
e e WOwoAV,VECARY e e FER YRAR— PER COFY
REAL PROBE OF PLAN DEMANDED
City Upholds 1 Y
Covof Senoats [Leadlers Accept Challenge of Foes
Jor Meetings N ational Headquarters Invites [Zreng Hits ot
o evatd evo P, ai % n False Friends
imrmtEnis Politicians to Fulfill Threat |of Prosperity
“irizz: of Investigation by Congress covsr™
and only incidentally an old-age
plan,
This view is borne out by the
official Townsend plan bill-—the
MecGroarty bill, H. R. 7164, intro
duced in the the last session of
A congress
) The McGroarty
@ % | il does not pro-
B
P % |vide for old-ase
| pensions of 204
a month or any
# ,’;’ fi other fixeda
R g
' i £ | amount. What il
L e -]
% e really provides
'é?&‘ | for is a tax levy,
e b | proceeds of which
L A after four mon
: ths, are to be
R _ZX aistributed pro
Witte ~ rata among per
sons over 60 years of age.
This tax levy embraces three new
and additional taxes, of which by
far the most important iz a 2 per
cent transactions tax—to be collect
ed on the gross dollar value of
every transfer or exchange of pro
perty of any kind, and also on every
payment for sgerviceg of any kina.
The only “transactions” not tax
ed are bank loans, inter-bank tran- |
sactions, and occasional non-recur
ring sales of less than SSO by peo-‘
ple who have no fixed place of
business. \ |
No Pay For Four Months |
This 2 per cent tax on all tl‘unsui
actions is payable at the end of
each month by the seller or recip
ient of the payment for services,
with the exception that the part
““Waterless”
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PRICED FROM 3569.&)@
of the tax which falls on wages and
salaries is to be taken out of the
pay checks in each payroll period
The McGroarty bill 18 very spe-
)cific that no payment of pensions
is to be made to anyone until the
‘beginning of the fifth month after
‘the Townsend tax becomes pay
able, In the fifth month, the amount
collected in the first month, less
costs of collection, is to be distri
buted pro rata among all personz
over 60 years of age qualified for
penafons; in the sixth month pro
ceedg of the tax received, always
less coat of collection, in the sec
ond month; and 8o on.
Two hundred dollars a month is
mentioned in the bill, not as the
amount of the pension to be paid,
but as the maximum amount. Act
ual amount may be S2OO, or S2O, or
sl, or nothing at all, depending
upon the amount of the taxeg col
lected above the costs of collec
tion. “w
The United States Census Bur
eau has estimated there are now
11,500,000 people over 60 years of
age. Less than 600,000 of them
were' not American citizens in 1930
and that number is considerable
smaller now.
Under the McGroarty bill, also,
people who have an income of $2,-
400 a year are not to be eligible to
pensions. In the total population,
considerably less than 10 per cent
have gross incomes of as much as
§2400 a year, and in all probability
that percentage is even less among
the people over 60 years of age.
24 Billions = rear
If 1,500,000 people over 60 years
are excluded from thie right to
f ; : , ® o
f% g e Wadve Shctic 7
4 . \ ’ @
FOODS ARE STEAMED ® NOT BOILED The Electric Range answers the call for
Health Cookery. Flameless electric heat, perfectly controlled, cooks with little or no water. Vegetables and meats
are cooked by STEAM. Little water is used because n‘o heat escapes around the sides ¢i the utensil to burn foods.
This process seals IN the healthful minerals, salts and vitamins. It cannot boil them OUT to be thrown down
|
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Sy $ 3
Representative C. Jasper Bell
share in proceeds of the Townsend
tax—which is an outside estimate
of the possible exclusions—lo,ooo,+
000 people are left to be pensioned
at the very outset, and S2OO a mon
th to 10,000,000 people is a cost of
two billions a month, or 24 bil
lions a year,
The two other taxes contemplat
ed in the MeGroarty bill could not
posaibly yield more than two bil
lion dollars a year, That would
leave 22 billion dollars to be raisea
through the Townsend transactions
tax,
For some unexplained reason, Dr.
Townsend now estimates 8,000,000
as the number of people over 60
vears of age to be pensioned, al
though earlier he estimated 10,000,-
000, As there are 11,500,000 people
over 60 years of age, the question
naturally arises why the other 3,-
500,000 would not receive pensiona.
That is approximately the number
of people over 60 years of age now
gainfully employed Perhaps Dr.
Townsend assumes that very few
THE BANNER-HERALD, ATHE?S, GEORGIA
f,people over 60 who have jobs or
farms or businesses would retire,
r Riddles Job Argument
| That, of course, destroys all argu
"ments offered by the Townsend
]organizen to the effect that the
Townsend: plan- would create mil
lions of jobs for young men.
i But, taking Dr., Townsend’'s lat
lest estimate of the number of pen
| sioners, S2OO a month for 8,000,000
ipeople totals one billion gix hun
!dred million dollars a month, or
| nineteen billion two hundred mil
|lion dollars a year. Dr. Townsend
iund his economist, Dr. Doane, esti
{mated that the total cost of the
| pensions for 8,000,000 people would
‘be eighteen billion dollars, which
|iz one billion two hundred million
ldollam less than pensions of S2OO
fa month to 8,000,000 people.
| In 1982, the U. S. total of all tax
les for all purposes by all govern
lmnet units was a little more than
eight billion dollars. Thig total 13
probably no greater now, but let us
say that it is nine billions. This
is only half of the amount Dr.
Townsend expects to raise through
his transactions tax.
How heavy a burden the Towip- |
send tax would prove is clearly
apparent when the total of eighteen
billion dollars is reduced to the
amounts which will fall upon the
Ipeople of each state and to what
{this tax cost the average family.
l Let us take Wisconsin, with al
lmost exactly 2.4 per cent of the
population of the United States andi
!ln every respect an average state.
|lt is fair to assume that the peo
|ple of Wisconsin would have to pay
*2.4 per cent of the total of the
|eighteen billion dollars which Dr.
Townsend expects his transactions
tax to produce, this 2.4 per cent
being $432,000,000. As there are
3,000,000 men, women, and children
,l‘n Wisconsin, this tax amounts to
an average of sl2 a month, for
ievery man, woman and child.
Menace to Business
| This enormous burden is impos
led in the Townsend plan annually
and is additional to all other taxes
|now levied. Moreover, it is im-«
iportant to remember that this tax
would be collected for four months
before anyone received an old age
| pension,
During these four months, on
lthe estimates of Dr. Townsena,
ithere would be collected four and
|one-half billion dollars in the Unit
ed States in payment of the trans
iactlona tax.
So long as no one received a
cent in pensions, no one now work
ing could be expected to retire;
and collection of a tax twice as
heavy ag all present taxes com
bined while no one got anything in
return could not fail to have a most
depressing effect upon business.
No country or state has ever
levied a transactions tax as in
clusive or at as high rates as the
proposed Townsend tax. The near
est parallel to such tax has been
the drain. All other methods of cooking require a super-abundance of
water because of a super-abundance of uncontrolled heat. When water
boils it rapidly breaks down food elements, dissolves them, destroys their
health value. The Electric Range STEAMS foocis in their own natural,
tasty juices . .. . thoroughly and hgalthfully. Chemical tests show the
amazing food losses when foods are c'ooked other ways. Why spend money
for food and then throw away a large portion of it, because you cook an
old-fashioned way? Go modern, cook electrically. Protect health!
@ CUT MEAT BILLS BY
{ It's disappointing to take a sadly
{ shrunken roast from the oven. To
( avoid this, many a woman buys the
most expensive cuis, only to get the
3 most ordinary results. Drafty ovens
make meat shrink. Only electric heat
requires no draft to burn. This is be-
‘the gross income tax, with which
a few states have experimented.
Indiana now has a gross income
tax, but with more exemptions than
in the Townsend tax and with a
rate of but 1 per cent on retail sales
and wages and of 1-4 per cent on
manufacturers and jobbers. The
Indiana tax yields a little more
than $1,000,000 a month,
Worker Easy to Check
Certain types of transactions
would not be difficult to reach if
the Townsend tax plan should be
adopted. The 2 per cent tax on
wages and szlaries is to be paid
by the employer and deducted from
each pay check, soo whoever else
escapes, the wage earners would
have to pay their share.
Ags Congressman Boileau has so
clearly pointed out, chain stores
and mail order houses would have
a very great advantage under the
Townsend tax plan over independ
ent merchants, as they avoid tax
duplication, buying directly from
manufacturers and often manu
facturing some of the products they |
sell; while independent merchanta]
must buy through jebbers and !
wholesalers, each of whom wculdi
add 2 per cent to his price on each:
transaction. (
In the Townsend literature the
picture is presented that a large
part of the tax would be collected‘
from sales of stocks and bonds ana
other speculative transactions on
the security and grain exchanges.
But it is certain that little revenue
vould ever be collected for gamb
ling and speculative transactions,
because they are so easily covered
up. “
It is a well-known fact that
sales taxeg fall with peculiar weight
upon, people of low incomes. Wage
earners, farmers, and others with
small or moderate incomes must
spend nearly all they take in and
under any saleg tax are taxed on
practically all their income.
The Townsend transactions tax
is a multiple sales tax, plus a tax
on wages, salaries, and profession
al earnings. Every sales tax tends
to be shifted to consumers in the
form of higher prices.
‘ Certain to Boost Prices
The seller usually adds some
thing more than the tax, to cover
interest on money he must advance
and payment for extira work which
the tax causes him. The Town
send tax would be levied on every
turmover, and each time the tax,
plus, very probably, an additional
charge, would be added to the
purchase price.
There is no way of estimating
how much the Townsend tax would
raise prices. Congressman Verner
Main of Michigan estimated an
average of from 10 per cent to 12
per cent. For many commodities
this increase would be much great
er,
Labor unions and farmers’ or
ganizations have always fought
taxes and the American Federa
T
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WHIT ABOUT
DR EXT
O pOVERNDR?
. Shall we elect somebody hunting
the job, or shall we hunt the right
‘man?
I want a Governor who has no
other thought than to attend to
that job, who is not bothered abhcul
how his acts will affect hig politi
cal future, but solely how they will
affect the general good—a man of
character, sense, judgment, honor.
There must be thousands of
Georgians who feel ag I do. If you
do, write me. Perhaps we can all
get together and pick the man to
put the state government in Ceor
gia on a plane where we can agalM
feel it's zreat to be a citizen of{
Gdorgia. |
FHILIP WELTNER, |
3482 Piedmont Road, |
4 Atlanta, Ga. ‘
~—Advertisement, i
—_—m - —_—
|
tion of Labor hag strongly con-g
demned the Townsend tax plan. I
OCn this attitude the labor un-’i
ions and the farmers’ m‘gunizations[
are certalnly, correct, because there !
is no doubt that this is the mnst!
burdensome and inequitable tax |
ever proposed. |
Repgncntative C. Jasper Bell,|
who heads the Townsend Plan quiz|
group in the house. f
Robert Earl Clements, the busi-|
ness man sparkplug of the Town-|
send organization. |
This story will interest
many Men and Women
NOT long ago I was like some friends I
have. . .low in spirits. . .run-down. ..out of
sorts. . .tired easily and looked terrible. I knew
I had no serious organic trouble so I reasoned
sensibly. . .as my experience has since proven...
that work, worry, colds and whatnot had just
worn me down.
The confidence mother has always had in
B.S.S. Tonic. ..which is still her stand-by when
she feels run-down...convinced me I ought to
try this Treatment...l started a course...the
color began to come back to my skin...l felt
better...l no longer tired easily and soon I
felt that those red-blood-cells were back to so
called fighting strength...it is great to feel
strong again and like my old self. @s.s.ss.co.
SSSX TONIC Makes you feel fike yourself again
ELECTRIC ROASTING
cause it is flame-free. Meat placed in
the oven of a Westinghouse Range
will come out tender, juicy, delicicus
—and almost as large as when it was
put in. A small roast will provide as
much meat as a larger roast cooked
the old way.
MONDAY, MARCH 9, 1936.
FOR EVERY MEAL
| Serve Mel-O-Toast Egg
BREAD!
| Tender, Rich and Tasty
' BENSON’S BAKERY
Women should take only
liquid laxatives
Many believe any laxative they
might take only makes*eonstipation
worse. And that isn’t true.
Do what doctors ‘do. 1o relieve
this condition. Doctors use liguid
THREE STEPS
T 0 RELIEVING .
i i CONSTIPATION
ot _III ;
A cleansing dose today; a smaller
quantity tomorrow; less each time,
until bowels need no help.at all.
laxatives, and keep reducing the
dose until the bowels need-mo help
at all.
“Reduced dosage is the secret of
aiding Nature in restoring re%ularity.
You must use a little less laxative
each time, and that’s why your laxa
tive should be in liquid form. A liquid
dose can be regulated to the drop.
The liquid laxative generally used
is Dr. Caldwell’s Syrumsm. It
contains senna and cascara — both
natural laxatives that form no habit
even with children. Syrup Pepsin is
the nicest tasting, nicest acting laxa
tive you ever tried, 4
AR
i
Vi v S S R
S Al )
1R AR B
S
R
e s GO
“Yes, | have come
back to where 1 feel
like myself again.'’