Newspaper Page Text
VOL. XXXIX. No. 12
Nobody Escapes Taxes; Everybody Has
To Help Pay Our Ever Increasing Tax Bill
Sponsored by the American Tax Payers League, Inc., and pre
sented by the National Broadcasting Co., as one of the weekly
discussions of the tax situation, Mr. Lerqy A. Lincoln, vice-presi
dent and general counsel of the Metropolitan Life Insurance Co.,
delivered recently the address below, his subject being “Every
body Pays The Tax Bill”:
The Boston Tea Party took place in t|ie days before slogans
were slogans, but it had what we moderns would call a slogan,
“taxation without representation.” In our recent days of trib
ulation, some wag has said that what we need now-a-days is “Tax
ation with representation.” Whether this be jest or not, there
is much food for thought in a slogan “Taxation with representa
tion.”
Under our form of government, certain elected officials are
sent to Washington, to our State Capitals, to our City Halls, and
out of their deliberations come taxes and more taxes. But is
there representation? Do they represent you and me and the
majorities who sent them there, or do ihey represent the vocal,
vociferous, vigorous—sometimes near-violent—minorities which
seek special expenditures for themselves?
Minorities Demand Special Favors
Special favors at the hands of government have always met
with disfavor at the hands of the American people so soon as the
people comprehended what was going on Take, for instance, the
great railroad enterprises of a generation or two ago. The pub
lic came to believe that the railroads were the recipients of spec
ial governmental favors. Thereupon, with one legal expedient
and another, railroads were put into a straight-jacket, but now r
the pendulum seems to be swinging the other way. Apparently
the railroads are to be preserved for performance in their great
field of real usefulness minus abuses which are admittedly things
of the past.
The railroads, the big service corporations, the big industrial
concerns no longer present a problem at all comparable with that
with which we are confronted at the hands of organizations of
individuals, having neither the form nor the substance of a busi
ness corporation. These organizations represent minorities
composed of persons with a common purpose. They demand this,
that or the other special consideration at the hands of some gov
ernmental |)ody, and as a consequence, there has ensued a con
firmed habit of extravagancy in connection with all public expen
ditures. Here, then, is the public problem of this fourth decade
of the Twentieth Century.
With no claim to being a prophet or the son of a prophet, I
do hazard this prediction, that when future historians shall he
appraising what has happened in this year of 1932, they will
place as foremost in importance, not a presidential election, not
a reapprai-sement of prohibition, not the weary ups and downs of
a business depression, but the awakening of the American people
to the prodigious expenditures which have been foisted on them
and on each of them at the hands of their various governmental
units. >—
Tax Rebellions Taking Place
There is going on before our very eyes today a rebellion, a
peaceable rebellion, a rebellion whose volunteers are voters and
whose bullets are ballots. Only last month we were reading in
the newspapers of what were called tax rebellions in certain
States. Similar uprisings of taxpayers have taken place in local
communities and no doubt will take place in many a town and
county through the land.
The import of these peaceful uprisings is this, that the man
in the street, the artisan, the farmer, the butcher, the baker, the
candlestick-maker, is now taking real notice of one tundarnental
fact. He is appreciating that what he supposed were taxes im
posed on some other fellow are taxes imposed on himself as well,
no matter how artfully their sponsors have, sought to deceive
him.
There is a striking similarity between this aspect of our com
mon tax problem and a radio talk. Over your radio comes the
voice of the speaker, but you, do not see him. With every dollar
you spend comes a tax, but you do not see the bill. No one re
minds you that you are paying a tax. These hidden taxes, and
our failure as citizens to realize that every tax is our personal
liability, whether directly levied on us or not, are largely respon
sible for our tax problems today. The solution of these prob
lems lies only in a recognition on the part of every citizen that
he and his wife and his children and his children’s children
have to hear this growing burden of taxation,
Governments, as such, have no magic power to support them
selves. Their income, the money used:to pay for their expendi
tures, must come out of your pockets and mine whether we are
rich or poor. It makes no difference, we all pay—either directly
or indirectly. If the rising fiood of taxes is to be effectively
stemmed before it destroys us ail, every citizen must be fully
alive to his own individual interest in the problems of taxation.
He must become active in his opposition to every unwise and un
necessary governmental expenditure because, in the last analy
sis, governmental expenditures can be supported only through
taxation. Each citizen must extend his interest to every branch
of government, national, state and local, for out of them comes
the sum total of all the taxes w'ith which we are so grievously
burdened.
Taxation Affects Everybody
The American tax system is complex. Its multiplicity of in
direct taxes, ostensibly levied against a few but ultimately paid
by all, have too frequently diverted the attention of the rank
and file of our people from their direct concern with the growth
of the tax burden in its entirety, and the real weight of that bur
den upon us all. Too frequently have we remained quiet about
GIBSON RECORD
Published to Furnish the People oi Glascock County a Weekly Newspaper mid as a Medium for the Advancement of th e Public Good of the County.
GIBSON, GA., WEDNESDAY, FEBRUARY 1, 1933
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YET, DELIBERATELY Ut CONCERNING HIS
« new addition ito some public budget because we were led to
believe that it would be paid for by a tax which would not af
fect us personally. Too frequently have individuals and groups
of individuals, advocating projects at the public cost—projects
embracing the interest of some but not all the people—too fre
quently have those groups been sivtce.-rslal in adding to seme pub
lic budget, items which would have been avoided had there been
a lively public interest in every proposed expenditure and every
proposed tax.
The common interest of all of us in matters of taxation, and
the vital effect of excessive taxation upon every individual, are
easily illustrated. Both landlord and tenant are equally con
cerned with the burden of taxation upon real property. Or take
the grocer. He can continue in business only if his tax burden
is shitted to every pound of sugar or of salt or of other necessi
ties which lie has for sale. The selling price of his commodities
must reflect the expenses of his business, one of which is his
tax. If his taxes go up, they must be added to the prices of the
goods lie sells. The railroads furnish still another illustration.
Ultimately their taxes must be paid by the shipper in increased
freight rates or by the passenger in increased passenger charges,
or by both in inferior service. If freight and, passenger rates are
too severely restricted, then millions of indirect investors find
such faxes reflected in the earnings of their securities. If you
arc a savings bank depositor or a holder of a life insurance
policy you are one of these indirect investors.
Policy Holder Pays All Insurance. Taxes
I am speaking not only as a citizen hut as an executive of a
life insurance company which has millions of policyholders.
What is the interest of life insurance in this problem? There
are some sixty-eight million life insurance policyholders in the
United States. Every other individual is a policyholder. They,
with flieir beneficiaries, constitute a major portion of the popu
lation of the country. Taxes purporting to be upon the business
of life insurance companies are fair examples of those indirect
taxes ostensibly levied against a big corporation but actually
paid by the individual policyholder. The policyholder pays his
tax with every remittance to hi s company, but there is no sepa
rate bill for this item to remind him of the tax.
In every State of the Union, save one, a percentage of every
life insurance premium paid by the policyholder must be paid by
the company into the treasury of tiie State by way of a tax.
There are also numerous oilier license taxes and fees, and, finally,
the federal income tax imposed upon all life insurance com pa
nies. These taxes, all of them, must, in the last analysis, he
borne by the policyholder, as reflected in the cost of his insur
ance. Tax a life insurance company a hundred thousand dollars
in your State and those of you who have policies in that com
pany have to stand that tax Dill either in increased premiums
or decreased dividends on your policies.
It shouTd be understood that nearly 80 per cent of th e life
ta
ticipating basis, . that is o sa>, c I
he something .. . i
dividends to policyholders. 1 remaining ovei ,
per cent of the ccountry’s life insurance, on a basis which does
not provide for reduction of premium by dividends, must com
neto with this participating type of life insurance and the burden
of oi taxation laxauuu is reflected in the premium charge for such insur
it is reileclcd in the iei uc ion o f < iv i „„ „„„ <
ance just as
ticipating policies. natural
Life insurance companies destroy no resources, en
• no s ,, ec i a i privileges and put the State to very little expense,
ihp 1 e Lirarv 1 ‘ thev serve the State. By far the largest per-
SUBSCRIPTION $1.00 PER YEAR
Community Plan For
Ga. Cotton Growers
By H. E. McConnell, Farm Agent
One seiious drawback to the
production of stapled cottons has
been the lack of marketing
ities to secure the true value
staple cotton.
Community production, as or
ganized around gin centers,
ton mill centers, and seed pro
duclion centers, has shown that
cooperative production is
much to remedy this situation,
and is one of the first steps in
cooperative marketing.
In order to secure the best
prices for our cotton and to make
a reputation for producing cot
ton of the qualities desired by
mills, many of the varieties now
being grown should be dis-
eentage of life insurance claim payments goes to the support of
those who might otherwise he dependent upon private or public
charity and thus become a burden upon the State. Policyholders
are already imposing upon themselves a charge to provide inde
pendence from public support and are relieving society of a bur
den it would otherwise have to carry. Why should these thrifty
policyholders he singled out for special taxation? This is a cold
practical question that every policyholder should bear in mind.
He should know' that a tax on his life insurance company is a
tax on himself, collected from him, without notice to him,
through the medium Of his life insurance company,
Only Avenue of Escape
And so it is whether the tax in one on real estate or on rail
roads, on living expenses or on life insurance. There is no such
tiling as a tax on property or services which does not inevita
bly come out of the pocket of the ultimate consumer of the
goods or services involved,
Indirect taxation behaves like an opiate. Its accompanying
deception that only a few are paying taxes for the support of
projects to he enjoyed by all, has brought upon us the same sort
of debility as follows the use of a drug. The habit of increasing
public budgets lias been gradually—almost unnoticeably—grow
ing upon us and we have not been awake to what has been going
on. But now Hie tragic enormity of the situation has become
clear to us in this time of depression. There remains for us but
one avenue of escape, an aroused and widespread public demand
for the utmost economy in governmental expenditures.
What can we do about it . Each one of us can associate him
economy and |j lux reduction, and actively cooperate with them,
yy e mus t a inform ourselves about local and State expenditures
an( j (j le position of candidates for office on this question,
We must make our views felt by direct communication with
•andidates before, particular'scheme and with representatives after, election. We
need advocate no of reduction of expenditures
or taxes. We should look to our elected representatives to ac
complish that necessary result through means which they should
best understand. ’Ihey should know where reduction of expen
ditures is practical. The necessary reductions will be made
when, and only when, our representatives in the various legisla
tive bodies fully understand that the people back home demand
reduced expenditures and reduced taxation and will have them.
carded and attention devoted to
a few varieties which will pro
duce the kind of staple in de
mand. The farmer who grows
a few bales of better staple cot
ton is not usually able to sell it
for its true value, for the reason
that the local buyer cannot get
enough of a uniform type to en
able him to pay a premium for
ii.
One of the largest tire manu
facturing companies in the Uni
ted States is making fabric in
Georgia to use in their tires.
They need a staple cotton and
only two sections of the state,
Commerce and Covington, are
producing this cotton in suffi
quantities to warrant their
buyers to go there and purchase
type. The mill uses 104 bales
of cotton per day average, and
they are shipping staple cotton
from Texas, Louisiana and Mis
sissippi to mix with Georgia
short staple because they cannot
get the stapled cotton here, ex
cept that which they secure from
the above two sections.
There are a few farmers in
many counties perhaps who
produce staple cotton but very
probably they do not get a pre
mium unless they ship to the
Cotton Grow’ers Cooperative As
sociation, because the local buv
cannot get a shipment suffi
iently large to warrant their
paying the extra price. If yve can
interest a group in each section
of the county in planting only a
few acres in staple cotton and
keep this cotton separated from
the other and then have a “gin
day” and all the farmers bring
their improved cotton in on these
days, the ginner will clean out the
rollers and you can get good
seed to plant the entire crop the
next year.
By proper selection each far
mer could get enough seed to
keep his cotton up to the stand
but most-farmers. prefer to
buy a few seed each year from
the originator.- You can get sat
isfactorv results the second year
from the originator,
but you will find readv sale for
seed only one year removed,
Community production offers
the following advantages:
1. Higher yields per acre for
community as a whole,
2; Less mixing of varieties at
the gin and less plated bales,
3. Cotton of uniform stanlo
and duality produced in large
amounts.
4. A higher average price on
the local market,
r >. Creation of a rcnutation
-
Unit will attract outside buyers.