Taxing Power May Be Used To Redistribute Wealth
Waldman, Louis
Taxing Power May Be Used To Redistribute Wealth Transition to New Social Order Possible Through Existing Government Powers—Nation May Acquire Industries by Usmg Power to Tax and Spend for...
...for the judiciary, as was pointed out by Chief Justice Taney in the Messenger case, exercises only a moral power and cannot execute its decrees in the face of the opposition of the executive...
...Existing facilities were unduly expanded, new facilities were added, snd old equipment modernized or replaced at a cost not justified by the returns to be expected in the industry...
...These episodes had convinced raHway labor organizations that the private owners were incapable of meeting the emergencies certain to occur in railway operation...
...Railway employees had seen the complete breakdown of the carriers in the earlier years of the World War...
...Owner Rule Inefficient From the very earliest day of railroad construction the industryhad been plagued by a succession of crises, due to inefficiency, to senseless rivalries, and to outright corruption...
...Yes, of course...
...Wage payments were declining, while interest payments were rising, and hundreds of thousands of railway workers were being thrown ont of employment...
...Labor Tackles Problem One of the obvious means of keeping bus and truck competition within its proper limits was in the development of a system of public regulation of these new transportation agencies...
...But that doesn't change the main fact...
...British labor is solidly behind the League Covenant," he emphatically declared, indicating that the movement would not shrink from its obligation to uphold the League against fascist aggressors...
...Nor are such taxes invalid for lack of uniformity...
...British Communism In response to my query about the united front, his answer was swift and positive: "When the British Communist Party applied for affiliation as a body to the Labor Party, they confessed their own failure and completely nullified their own effectiveness as a Communist Party...
...Occasional raids by individual financiers have given way now to permanent control of the industry by a closely coordinated financial group...
...Two states—Ohio and North Dakota—have by Constitutional provision limited the right of their highest courts to declare laws unconstitutional unless a specified number of judges concur...
...Such an act would be within the .Constitutional power of Congress, under Article III, Section 2 of the Constitution, which provides thst "the Supreme Court shall have appellate jurisdiction, both as to lew and fact, with such exceptions and under sack regulations as the Congress shall make...
...1 ir&ffyj...
...He spoke with enthusiasm of the bright prospects of British labor which, he asserted, had staged an astounding come-back since the 1931 election, when the intrenched forces of British business, backed by the power of the press, combined to knock the bottom out of the Labor Party...
...And so is every newspaper in th( United States, so far as government is concerned...
...Greenwood greeted me most warmly, we ensconced ourselves in a corner of the lounge room of the Algonquin, where, between cigarettes and...
...They had seem that only government operation was able to tide the railroads over this period of maximum traffic...
...A Talk Witt The Author of Love on a Dole By Harry HaskeJ A FTER interviewing the author of the much-1alked-about play "Love on the Dole...
...And more recently, an editorial criticism of the income tax decision in 1895, in the American Law Review, said: "If the President in this instance were to elect to go forward snd execute this law in all its parts, the judiciary would be helpless...
...The Supreme Court stated: * * * "we Stow of no legal principle to present the legislature from taking sway • • * the right of testamentsry disposition...
...While the total nun-' ber of investors in railroad stocks and bonds is very large, the difficulty of expression of the wul of the small investor, combined with the forms of the corporations in the industry,, have riveted the control of the bankers upon American railways...
...The unquestioned power of the government to raise unlimited funds tnd sat it for whatever it regards si the general welfare is so rich in possibilities for practical statesmanship that the policies set in motion through the power to spend eoold completely overcome all constitotional obstacles...
...In 1861, Chief Justice Taney held the suspension of the writ of habeas corpus unconstitutional and cited an officer responsible for its violation for contempt...
...Wherever it was possible to change a process, add a physical facility, or introduce machinery to 1fii|ihMis labor, railway managements made the change...
...The boards of directors of the railway corporations include the direct representatives of the financial powers dominating the industry...
...More than that, railway labor had seen, not only during the war,, bat during the depression which followed, that railroad managements sought to place upon the backs of labor the burdens growing out of the failure of those managements to meet their operating and financial problems...
...C For Mr...
...outlook for British labor, dictatorship snd democracy, and the psychology of the American worker...
...When, during the Civil War, powers assumed by the federal government were called into question, President Lincoln had Congress pass an act authorizing the appointment of an additional judge to the Supreme Court and filled the place immediately with Stephen J. Field of California, who, he knew^was favorable to his policies...
...Railway labor began the study of this problem and undertook action to meet the problem as soon as it became pressing...
...Bf the mere process of extending the functions and scope of the postal savings banks, the government could enter the field of hand|iaf the nation's banking and credit in a way that would quickly bring the entire banking system under ¦rthc control...
...And Communists in New York's Union Square can call for its complete overthrow...
...policies of Asserican Socialists, Greenwood nevertheless significantly declared: "I think the American people have too much sense to want to go in for dictatorship...
...If it may be exercised at all, it mast be exercised at the will of these in whose hands it is placed...
...Sues a tax has been sustainMftytSfSapreme Court in 1929...
...our neighbors can assemble...
...What stops us...
...In the **^*Jn of the last amendment— ¦"•.repeal of the Eighteenth **fMnient—it was shown how an ~J*f™n*nt can be put through ?*g*os and ratified by the states than one year...
...No consideration of public necessity, of employees' rights, or safety of the workers is allowed to interfere with such management policies ss will produce the greatest possible return for the group in control...
...There is likewise freedom of speech...
...Sometimes engines go off the track, but the main fact is that trains run daily, pretty generally on time...
...And so, these are things to keep in mind...
...Walter Gseenwood, coauthor of the play which is based on his novel of the same name, seemed to me, at least, to typify the practical, commonsense characteristics of his party, combined with s virile, intellectual spirit that eschews dogmas and policies, as he himself put it, "out of touch with actuality.'' After Mr...
...Even in this effort rsilwsy workers cooperated whole-heartedly,.hot only the stringency of the depression brought railway managements to an understanding of the absolute necessity for complete public regulation of competing transportation industries...
...These years of extreme suffering have brought to the workers generally, and to the railway workers in particular, the realisation thst something .must be done,to curb the hunger of our rmancisl over-lords for profit end power...
...The financiers of today, just like their predecessors of the era of more open piracy, are primarily concerned in deriving from the railroads the maximum of profit...
...Its direction will inevitably take the form of the popular will...
...And there is an equally, complete lack of freedom in a dozen'lesser nations...
...The factors which produced thst technological unemployment also produced the depression...
...And far from being relegated to the musty book as historical curiosities, these examples are being actively discussed today in the press and in governmental circles as correctly indicating the limitations of the Supreme Court...
...These stock-market manipulations not only defrauded thousands of investors of their savings, but also took their toll of the physical facilities of the industry...
...Opponents of government ownership always listed ss one of the principal arguments against the change, that railway labor organizations would gain undue power through their political influence in the determining of railway management policies...
...And, finally, where the personnel of the Court may become an obstacle to the advance of'a program of socialization, Congress and the President have the power, under the Constitution, to increase the number of judges and to appoint to the bench men whose legal opinions conform to the ideology of the day and reflect the view of the people and the government...
...We will now briefly deal with the power of taxation...
...And, the Court continued, "if a state may deny the privilege altogether, it follows that, when it grants it, it may annex to the grant any conditions which it supposes to be required by its interests or policy.'* The federal government, through Congress, alsov has the power to Wry inheritance taxes...
...We have jury trials — freedom against wanton jailing...
...British Labor for Sanctions Greenwood spoke modestly about his play, "Love on the Dole...
...Such taxes cannot be challenged on the ground Skat they amount to a confiscation of property...
...Bnt the monopoly- problem is not the most serious in this railway development...
...Inheritance of property could .be abolished entirely by a State government, if it wanted to do so, without infringing any provision ef the Federal Constitution...
...a scholarship to Brookwood Labor College, s radio sot sad a serfe* of free vacations at Unity House...
...With the most charming informality he mimicked a Communist "soap-box" orator discussing dialectical materialism as though it were the burning question of the hour...
...A careful reading of history reveals that Constitutions do not make economic institutions and social relationships, but economic institutions and social relationships make Constitutions...
...The managerial effort which should have been expended in developing new facilities and services aimed at meeting this competition west instead into the universal process of whittling down service and Costs, in order to pay the maximum return on the steadily increasing railread capital and indebtedness...
...Checking the Courts In passing, it should also be mentioned that in the vigorous days of the formative period of the Republic, the power of the Court to enforce its decrees against the executive and legislative branches of the govern me n t was brought into doubt on several occasions...
...There is ample precedent for such procedure...
...Something to" remember...
...By Louis Waldman VII The constitutional weapon* in the battle by oar people against coeial evils have generally been fashioned under three governments...
...As has been pointed ont, the railway industry was an outstanding example of this tendency...
...which has created quite a stir in New York, I think I can better appreciate why British labor is such a' powerful industrial and political force in England...
...We can only examine into its power under the Constitution, and the power to make exceptions to the appellate jurisdiction of this court is given by express words...
...His eyes flashed when he declared: "People like my grandfather have sacrificed too much— have, to use a trite phrase, fought and bled for the ideals of democracy to give us our heritage of political freedom—for me, despite the Shaws and Mussolinis, to want to jeopardize it in any way...
...The suffering of these lent-sis years can be st tribe ted directly to the fact that the guiding principle of our business men in the years from 1*22 to 192* was to take the greatest possible snare ef oar notional income for themselves in the form of dividends sad interest, snd to reduce to the minimum the amount which had to be paid to labor in the form of wages...
...Aa Importon tPrecedent There is precedent for Congressional legislation taking from the Supreme Court its appellate jurisdiction in certain cases...
...flVt* One of the most disastrous effects of this policy was the tremendous increase in technological unemployment of railway workers...
...Where the will exists, and the govern"** 1* ready to take energetic r**»hip, an amendment to the ~J*~tetton is not so cumbersome *m So difficult to obtain as had "•heretofore believed...
...They had seen, during the 1920-1921 collapse, that the railroads asked for, and received, government assistance over a period when traffic had been greatly reduced...
...The Interstate Commerce Commission has performed s splendid service, bnt the industry now faces an emergency in which regulation is no longer adequate...
...And President Jackson said with reference to*another decision of the Court: "Chief Justice Marshall has made his decision, now let him come off the bench and enforce it...
...He confirmed that the prevailing opinion was that Morrison will probably be the Prime Minister when Labor forms its next government...
...Change by Amendment first place, there is the r~.T...
...This newspaper can print freely...
...But the marshal] who sought to serve the citation was stopped by the bayonets of federal troops and the prisoner was not released...
...Their efforts were largely confinedto the organization of "ship by' rail" movements, appealing directly to shippers to prefer railroads to over - the - road transportation...
...It is well known that Chief Justice Marshall decided against the petitioners in Marbury v. Madison, although his sympathies were with Marbury and his colleagues, because he knew that President Jefferson would have refused to obey a contrary decision...
...The bribery and graft of the construction era was followed almost immediately by the financial juggling by the men who had come into control of the railway properties...
...For that nobody gets shot, or even arrested...
...The Labor Party was right in rejecting their application...
...While, of course, not venturing to comment jpn the...
...The change in policy was made only after long.'consideration by the organizations of railway workers...
...you can speak freely...
...ehen the Supreme Court is so JJSsjJtated in its personnel as to "¦ft the will of the people and *srtion of Congress and the legthe government would •°«Jmve remedies under the Contfbsion...
...During our discussion I referred to the internal struggle within the American Socialist Party...
...sf Remember these elements of freedom...
...When I took my leave of Mr...
...There are four principal forms of taxation for this purpose...
...Greenwood, he cordially accepted my invitation to visit the Rand School, where many of our party institutions are housed, before he sailed for Europe at the end of the week...
...The farmers had, through their various organizations, been urging government ownership for nearly fifty years...
...These unions, and the men they represent, are now, finally and definitely, convinced that the federal government must take over the railroads if the industry is to survive and to serve the public as it should...
...For Democracy On the question of dictatorship, he left no doubt as to where he stood...
...The net effect, of course, was to reduce the amount of money being paid out in wages and to increase the return to thee* wbo invested the money to buy rile new machinery or erect the new facilities...
...In the face of this belief of those who resisted government control, it is of the greatest significance that railway labor did not actively urge that the federal government take oveT the railroads permanently until after federal control had actually begun...
...of power and privilege relating from the control of wealth...
...go, can say exactly and fully what ever it cares to say, so long' as i does not transgress the libel laws ' And even on the matter of libel it can get a jury trial and per haps get away with it...
...If they wanted to join the Labor Party individually, there was nothing to stop them...
...In the words of Chief 'justice Marshall: "Questions of power do not depend sa taa degree to which it may ba exercised...
...The present industrial form of organization could be transformed into a new social order •7 governmental methods hereto*ue tried and found to be within ts*Constitution, though never used SB sufficient logic snd consist•afto displace the capitalist order •Mtottsation by a Socialist order...
...Music and entertainment will be furnished by Body Valine with his orchestra and s corps of specialty performers The prises to be awarded by the committee of judges 'wrndr- trips 1 to the Soviet Union sad Porto Rico...
...During the period of reconstruction, following the Civil War, an editor named McCardle was arrested under one of the Reconstruction Acts passed by Congress and he sought to test the constitutionality ef the statute by applying for a writ of habeas corpus...
...TAXATION has been long rec* .agnized as an effective weapon ssakst the excessive accumulation of wealth and the concentrate...
...powers: the police power, He power of taxation snd the pewer of eminent domain...
...That is something to think about • » * This newspaper has a freedom not enjoyed by any newspaper, no matter how great, in three of the great nations of the world...
...but after speaking to him, I rather suspect thst he himself takes most pride in his position as Labor Party Councillor in Sulford, near Manchester, to which office he has been elected...
...When I suggested that British labor was divided between the peace-a t-any-price pacifists and those favoring sanctions against an aggressor, he disagreed...
...Labor Has Been Patient It is worthy of- notice here that there had been, long before that, widespread demand for government ownership of the railroads...
...Not until 1935 did these railway labor unions begin an active campaign for government ownership and operation of the railroads...
...The Court then proceeded to hear argument on the merits and before it rendered its decision, an act was' passed by Congress, over the President's veto, wiwthdrawing from the Supreme Court its appellate jurisdiction in habeas corpus proceedings...
...fused to cooperate with the railway labor organizations, but in some cases, apparently because of a fin* arcial interest by those who owned the railroads in the new transportation facilities, railway managements definitely opposed public regulation of busses and trucks...
...Income taxes may be levied with very high surtaxes on incomes in the higher brackets...
...I Ilea Possibilities Attempts to avoid inheritance appTaJ lift11 inter vivos could be pieveatad by a federal tax on such pft...
...And by the eame token, Congress eooM also forbid the export of foods to foreign countries to avoid inheritance or gift taxes...
...Anything I can do to help perpetuate democracy I will do...
...They are income taxes, inheritance taxes, gift taxes, and a capital levy...
...Railway managements not omyre...
...Bankers Now Control Unified financial control, in and of itself, of an industry so vital to the welfare of the nation ss are the railroads is of very great danger...
...At the same time, he admitted that although his play was a picture about the privations and sufferings of the unemployed living on the dole, without crude moralizing, nevertheless he "wanted to convince people that-this life was not only unjust but unnecessary...
...My views are perhaps extreme in some respects, but they are conditioned by the constituion and principles of the party...
...power of amendment...
...We hare these things that go to make up freedom—freedom even to be foT^lshA to make mistakes and to find oat democratic, muddling way through to the highest goal we can envision...
...This newspaper is free...
...The surplus earnings of the railroads, end a very large contribution from the surpluses being built up elsewhere in the country, were forced into the railway industry in a manner which loaded down the carriers with a heavy snd unjustified burden of debt...
...The Court then dismissed the appeal "for want of jurisdiction," saying, through Chief Justice Chase: "We are not at liberty to inquire into the motives of the legislature...
...He understood the aversion to "labor plays" that merely "ranted...
...it will continue to do so in the future...
...Only through government ownership and operation can the carriers be rehabilitated, the industry coordinated, and the employees and the public as s whole protected against a recurrence of the long train of abuses which hsve brought the railways to their present physical and financial straits...
...The com- 1 r*?*aswer, therefore, to the obf**as of a program of social legZ** n leading to Socialism on the E?*ftkat it contravenes the Conis that this document, ^**> framed, was not intended to ?J*'*m*ble- And when the naanich the Constitution is sup•¦¦satnserve requires for the con^"^fappiness and contentment "***,**» that a^ change be made ^y*_*yn change is not acceptm/v""*8* present provisions, it J*** made acceptable by amend** ^aecond place, if the Court is divided as it has been en social questions, Congress may adept a lew requiring that no statute shall be declared unconstitutional unless by a unanimous vote, or at least a 1 to 2 vote, of the members of the Court...
...In the years preceding the depression the railway industry offered to American financiers one of the most promising opportunities for the investment of the huge funds made available by American business profits...
...That could not be done in Italy, or in Germany, or in Russia, or in a dozen or more lesser countries, including Poland and'Greece.'V Something to think about, that is...
...sips of coffee, we discussed labor plays, the...
...Again, in 1872, President Grant used the occurrence of two vacancies on the bench as the occasion for appointing, on the day that the first legal tender decision was' rendered, two additional judges — Justices Strong and Bradley — who then voted to overrule the previous holding...
...some pretty bad ones...
...The petitioner having been remanded to custody, he appealed to the Supreme Court which, after its first hearing denied the government's motion to dismiss the'-appeal...
...Consider then, that not a single newspaper in Italy, or in Germany or in Russia is . free...
...Our Heritage of Human Freedom By Chester M. Wright fkJO matter what any person ma: • v think is wrong, there is tjui great big truth: ( This newspaper, not a very bit .newspaper as American newspaper...
...Taxing Power May Be Used To Redistribute Wealth Transition to New Social Order Possible Through Existing Government Powers—Nation May Acquire Industries by Usmg Power to Tax and Spend for General Welfare—The Extension of Postal Money Banks Will Bring Nationalization of Finance...
...It these financial and managerial policies had been calculated to improve the ability of the railroads to meet the competition of new transportation agencies . there might have been some justification for their adoption...
...The patience and forebearance of railway labor is further demonstrated by the fact that the active campaign for government ownership of railroads was discontinued, and the private owners and managements were given the cooperation of railway labor in their efforts to operate the railroads successfully in the post-war decade...
...But quite the contrary had been true...
...At the rate st which public funds are now being spent in "aiding" banks, title eSapsnies, railroads and other busiStss, the government could, by be-, coming either creditor or preferred stockholder in the business thus "tided," take over and control vast enterprises now in private hands...
...Every thing was subordinated to the primwRy goal of the railroad barons, which was then to loot and "get out from under" with the maximum profit to the looters...
...even in the least degree...
...Government Ownership and Operation Due to Depression and Other Causes Rail Transportation --Ami an Emergency Which Makes Regulation lna4equaU-4imjernm^ MustTakeOver Lines to Rehabilitate Carriers and to Protect Workers from Ravages of Unemployment By George M. Harrison, Chairman, Labor Executives Ass'n INURING the years hnrnediately following the World War, and^during the depression of 1920-1921, the national unions representing American railway labor took a position strongly in favor of government ownership of the railroads...
...Any reader of this newspaper can hire s hall and say just about anything he likes about the government, local, state or national...
...A young man of athletic build, probably in his early thirties, Greenwood has already made his mark as a novelist and playwright...
...The American Constitution has grown in the past to accomodate itself to our changing economic and social life, reflecting, in the final analysis, the prevailing public point of view...
...We real* ize now that the technological unemployment of 1929, and the years just before 1929, was a symptom of a pernicious disease in the vitals of the industry...
...Services were so curtailed that bus and truck operations took steadily larger shares of traffic which had formerly gone to the railroads...
...It is a commonplace to the people of the United States now that most of the great corporations controlling American commerce and industry are, in their turn, controlled by financial interests which center in a few powerful New York banking houses...
...The depression taught not only this lesson, but also many others, to the railway workers, end, we believe, to the people of the United States...
...When I mentioned the Mosley fascist movement, he minimized its importance, but added: "I have seen too many knocked over the head by Mosley's fascists to want to have anything to do with dictatorship of any kind...
...We can see new clearly in retrospection that the financial and managerial policies of American business prior to 192* made ear catastrophic depression inevitable...
...The "•¦jfntion has already been 2*5*** twenty-one times...
...When informed that Herbert Morrison was coming to the United States in April as the guest of the Rand School, he remarked that no man is better equipped to interpret the British Labor Party to America than Morrison...
...we can all tell government what we want...
...Abuses...
...He paid his respects to the "ranting" and "irresponsible" tactics of the British Communist Party which, he said, "never was and never can be of any importance in the British political scene...
...Dressmakers to Hold Annual Masquerade Bali About 15.000 are expected to attend the annual bnH of Dressmakers' Union, Local 22 of the International Ladies' Garment Workers' Union, this Saturday evening, March 28...
Vol. 19 • March 1936 • No. 13
