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THE PRESIDENT SENDS HIS SPECIAL MESSAGE TO CONGRESS
ASKS TO HAVE COIISTITUTIflll HIDED
Believes an Income Tax on the Net Income of Corporations Should be
Adopted and Made a Law.
Washington. D. C. Recommending
legislation looking to the placing of
a two per cent tax on the net income
of corporations and also the adoption
ot an amendment to the constitution
providing for the imposition of an in
come tax without an apportionment
among the several states. President
Taft Wednesday sent to Congress a
message embodying his views on the
subject. This action followed a pro
tracted special meeting of the cabinet.
The text of the President's message
is as follows:
To the Senate and House of Represen
tatives: It is the constitutional duty of the
President from time to time to recom
mend to the consideration ot congress
such measures as he shall judge neces
sary and expedient. In my inaugural
address, immediately preceding this
present extraordinary session of con
gress. I invited attention to the neces
sity for a revision of the tariff at
this session and stated the principles
upon which I thought the revision
should be effected. I referred to the
then rapidly increasing deficit and
pointed out the obligation on the part
of the framers of the tariff bill to ar
range the duty so as to secure an ade
quate income and suggested that if it
was not possible to do sc by import
duties, new kinds of taxation must be
adopted, and among them I recom
mended a graduated inheritance tax
as correct in principle and as certain
and easy of collection.
The house ot representatives has
adopted the suggestion and has pro
Tided in the bill it passed for the
collection of such a tax. In the sen
ate, the action ot Us finance commit
tee and the course of the debate in
dicate that it may not agree with this
provision, and it is now proposed to
make up the deficit by the imposition
ot a general income tax in form and
substance of almost exactly the same
character as that which in the case
ot Pollock versus Farmers Loan and
Trust Company (157 U. S. 429). was
held by the supreme court to be a di
rect tax and therefore not within the
power ot the federal government to
impose unless apportioned among the
several states according to population.
This new proposal, which I did not
discuss in my inaugural address or in
any message to the opening ot the
present session, makes it appropriate
for me to submit to the congress cer
tain additional recommendations.
Favors Income. Tax.
The decision of the supreme court
in the income tax cases deprives the
national government of a power which
by reason of previous decisions of the
court, it was generally supposed the
government had. It is undoubtedly a
power the national government ought
to have. It might be indispensible to
the nation's life in great crises. Al
though I have not considered, a con
stitutional amendment as necessary to
the exercise ot certain phases of this
power, a mature consideartion has sat
isfied me that an amendment is the
only proper course for its establish
ment to Its full extent. I therefore
recommend to the congress that both
houses, by a two-thirds vote, shall
propose an amendment to the consti
tution conferring the power to levy
an Income tax upon the national gov
ernment without apportionment among
the states in proportion to popula
tion. This course Is much to be preferred
to the one proposed ot re-enacting a
law once judicially declared to be un
constitutional. For the congress to assume that
the court will reverse Itself, a"d to
enact lejislatioo. on such an assump
tion will not streagtien popular con
fidence tn the stability ot judicial con
struction ot the constitution. It is
inch the wiser policy to accept the
decision and remedy the defect by
amendment in due sad regular course.
Again. It is clear that by the enact
meat of the proposed law. the con
gress will not be bringing money into
the treasury to meet the present de
ficiency, but by putting on the statute
nooks a law already there and never
repealed, will simply b suggesting to
the executive officers ot the govern
ment their posslbi duty to invoke
Utfgatiua. If the court should main
tain Its former view, no tax would be
collected at ail. It It should ultimate
ly revere itself, still no taxes would
have been collected until after pro
tracted delay.
Thinks Nation Favorable.
It Is said the difficulty and delay in
securing the approval of three
fourths of the states will destroy all
chance of' adopting the amendment.
Of course, no one can speak with cer
tainty upon this point, but I have be
come convinced that a great majority
of the people of this country are in
favor of vesting the national govern
ment with power to levy an income
tax. and that they will secure the
adoption of the amendment in the
state if proposed to them.
Second, the decision in the Pollock
case left power in the national gov
ernment to levy an excise tax which
accomplishes the same purpose as a
corporation income tax, and is free
from certain objections urged to the
proposed income tax measure.
I therefore recommend an amend
ment to the tariff bill imposing upon
all corporations and joint stock com
panies for profit, except national
banks (otherwise taxed), savings
banks and building and loan associa
tions, an excise tax measured by 2 per
cent on the net income of such cor
porations. This is an excise tax upon
the privilege of doing business as an
artificial entity and of freedom from
a general partnership liability enjoyed
by those who own the stock.
I am informed that a 2 per cent tax
of this character would bring into the
treasury of the United States not less
than $25,000,000.
Tax on Privilege Valid.
The decision of the supreme court
in the case ot Spreckles Sugar Rain
ing company against McClain (192 V.
S. 397), seems clearly to establish the
principle that such a tax as this is an
excise tax upon privilege and not a
direct tax on property and is within
the federal power without apportion
ment according to population. The
tax on net income is preferable to one
proportioned to a percentage of the
gross receipts, because it is tax upon
success and not failure. It imposes
a burden at the source of the income
at a time when the corporation is well
able to pay and when collection is
easy. Another merit of this tax is the
federal supervision which must be ex
ercised in order to make the law ef
fective over the annual accounts and
business transactions of ail corpora
tions. While the faculty of assuming
a corporate form has been of the ut
most utility in the business world, it
is also true that substantially all ot
the abuses and all ot the evils which
bave aroused the public to the neces
sity of reform were made possible by
the use of this very faculty. If now
Sy a perfectly legitimate and effective
system of taxation we are incidental
ly able to possess the government and
the stockholder and the public of the
knowledge of the real business trans
actions and the gains and profits of
every corporation in the country, we
have wade a long step toward that
supervisory control of corporations
which may prevent a fu'ther abuse of
power.
I recommend, then, first, the ado
tion of a joint resolution by two-thirds
of both houses, proposing to the states
amendment to the constitution
granting to the federal government
the right to levy and collect an in
come tax without apportionment
among the states according to popula
tion; and. second, the enactment as
part of the pending revenue measure,
either as a substitute for, or in addi
tion to. the inheritance tax. ot an ex
cise tax upon all corporations, meas
ured by 2 per cent ot their net income,
(Signed) WILLIAM H TAFT.
The White House. June 16, 1909.
Oar guaranteed Roll Edge felt
. Mattress cannot C"7 CA
be beat at -53 V
Bamboo
Porch Shades
6x8 at $1.50
8x8 at $2.00
lCxO at $2.50
Our Machine is a Revelation
IN STYLE
IN FINISH
IN BEAUTY
IN EQUIPMENT
IN EFFICIENCY
$14.75 to $27.50
'Warranted for fO Years
Gash
Department
Store
Prices
Not the Long
Furniture
. Store
Prices
$12.75
Waxed Oak with
Wood Knobs
Like Cut
7 Green and Brown Velour and Plush Couches $12.50 to $18.00
. AT 25 PER CENT DISCOUNT
a- -." , 3
Rugs
New Rugs Added to Our Stock
Every Day from Our
Workroom
at Sale Prices
Mattings
All of our Red and Green Carpet
Pattern Mattings. 30c and 35c
grade, this week at
22 1-2 c a Yard
. 20c Yard in Roll of 40 Yards
Linoleums
Bring the size of your room and
see if we can fit it with a Remnant
All Remnants from
35c to 40s a Ycrd
2 PIECE INLAID 75c YARD
We have German Clerics
in these Departments
who can wait on
German Customers
Let Us
Figure on
Furnishing
Yovr
Home
Complete
THE l DAYLIGHT STORE
THE & TO R E THAT SATISFIES
B Wc Can't
Save
Too Money
Wc Do Hot
Ask Your
Trade
WILL VISIT EUROPE.
may visit, I can say that I shall prob-; and cordial manner in which the dele-
Emperors Soon to Bo Together.
Si. Petersburg Premier Stolypin.
Foreign Minister lswolsky. Count Yon
Pourtales. the German ambassador,
and the German military and naval at
taches left here Wednesday morning
on board the Russian imperial yacht
Polar Star to join Emperor Nicholas
at Pitkipas bay. where the meeting
between Emperor Nicholas and Em
peror William of Germany will occur
I Thursday. Emperor William already
is on his way to the rendeivous.
New Road Opened to Northwest.
Winnipeg. Man. The first regular
passenger train on the Grand Trunk
Pacific railroad arrived at Scott. 569
miles west of here, at l:4u p. m.
Tuesday. The train carries 215 pas
sengers, who are being taken to the
rich lands opened up by the new road.
The majority of the passengers are
American settlers.
Hurry Up Call for Lorinxr.
Chicago. 111. In response to a "cor
rected' message from United States
Senator Cullotu, Senator-elect William
Lortnter left for Washington Wednes
day afternoon. The tariff situation at
the capital is believed to have in
spired the summons.
Lorimer determination to hurry to
th capital means that he has
changed his mind about retaining his
membership in the house of represen
tatives daring this special session, and
tnstead will be sworn in at once as
senator.
Ticket Chosen at Harrisburg.
Harrisburg. Pa. The Republican
state convention here Wednesday
nominated the following ticket:
Auditor General Arthur E. Sisson.
Erie.
State Treasurer Former State Sen
ator Jeremiah A. Stober, Lancaster.
Associate Justice ot the Supreme
Court Judge Robert Von Moschxisker,
Philadelphia.
The candidates named were slated
by the state organisation of which
Cnited States Senator Penrose Is the
head.
President Gompers Issues Letter Be
fore He Goes Abroad.
The Denver convention of the Am-
' erica n Federation of Labor, by a unani
mous rising vote, passed a resolution
providing for sending its president.
Samuel Gompers. as a fraternal dele
gate to the British Trade Union Con
gress, and Mr. Gompers is preparing
to obey the behest.
What He Hopes To Do.
Concerning his trip Mr. Gompers. in
the American Federationalist for June, i
says: . j
"The delegates to the Denver con
vention were evidently under the im
pression that the International Trade
Union Congress was to meet this year.
After adjournment and some corres
pondence it was learned that the coa
gress was to be held at Stockholm.
Sweden, in 1910. with authority,
"should any important occasion arise."
to call it in 1909. When the secre
tary of the International Trade Union
Congress. Mr. C. Legien of Germany,
learned of the fact that I had been
elected to attend the congress in this
year, he deemed the occasion as com
ing under the provision which would
allow the calling of the meeting in
1909, and submitted the question to a
vote of the secretaries of the affiliated
trade centers of the several countries.
It was approved by an almost unani
mous vote. At this writing, however.
the date or the city in which the con
gress will be held is not known, Paris
London and Stockholm are being
voted for, and. probably, August the
time.
Will Visit Several Countries.
"The executive council has directed
me to visit several countries and at
tend such labor congresses as may be
held, and to make an investigation of
many features connected with the in
dustrial conditions of the workers and
of the state of development of the la
bor movement. In accordance with
these invitations and directions, I have
made arrangements to sail from New
York on the steamer Baltic, June 19.
due at Liverpool, June 26.
"I shall be in attendance at the
Federation of British Trade Unions at
Blackpool. July 1-2, then visit briefly
one or two cities in Ireland and Scot
land, and then make my way to Lon
don, in which place already several
meetings and conferences have been
arranged. From thence to Paris, and.
without any attempt at giving the or
der of the cities or countries that I
ably go to Cologne, Bremen, Hamburg,
Essen, Berlin. Vienna, Budapest, Rome,
Naples. Venice. Geneva. Berne, Basle,
Brussels. Antwerp and Ipswich,, the
latter to attend the British Trade
Union Congress, and then return on
the steamer Adriatic, which sails from
Cherbourg on September 29. This
statement of places to be visited is
subject not only to extension, but to
change, and this will depend particu
larly upon the time and place when the
International Trade L'nion Congress
may convene.
Court Sentence Will Not Interfere.
"In connection with my leaving the
United States. I have been frequent
ly asKea wnetner me decision ana p
sentence of Justice Wright would
not interfere. In answer, I may say
that I have consulted our counsel, and
they sdvise me' that the decision of
the court cf appeals will not be ren
dered before the opening of the term
of the court in October, and that I
may therefore undertake the trip
without any mental worry on that
score. Of course, it is unthinkable
that I would undertake to leave the
jurisdiction of the United States with
the possibility of a decision of the
court being rendered during my ab
cense. Work Will Go on as Usual.
"Insofar as the work of the feder
ation is concerned, it will be ordinar
ily conducted. Business will go on "at
the old stand.' Work which I might
otherwise initiate, will, of course, be
in abeyance. Any matter requiring
any immediate attention and work of
a discretionary character will receive
the attention and direction of the offi
cers of the American Federation of
Labor whose advise and consultation
will be sought. I shall endeavor to
write some letters for publication in
the American Federationalist, and I
have requested the members of the
executive council and others to make
some contributions to appear in the
editorial section. All matter appearing
in that section will bear the name of
the author.
"It is with considerable reluctance
that I lay aside, even temporarily, the
important, interesting and often fas
cinating office work of the American
Federation of Labor. My mind and
whole being are bound up with the
movement and the great uplifting
work.
Expects a Busy Time.
"I have reason to believe that one
of the thoughts prompting the ready
gates to the Denver convention direct
ed me to make the European trip was
the desire to. in a measure, give me
some sort of a vacation or time for
rest and recuperation, bnt what with
the tentative arrangements and "those
already made on the other.- side and
others which will arise, I am quite
confident that I shall have an inter
esting and a very busy time. I shall
endeavor to convey to our fellow work
ers in Europe the very best thought
and sentiment of the toilers of Ameri
ca. I hope to return with a fraternal
message of good win and better equip
ped to be of service in the great cause
of labor and common humanity. While
the July issue of the American' Fed-
ernationalist will be under my editorial
direction, I expect to be on the high
seas when its pages will be in the
hands of our friends, hence the above
as a parting salutation of cheer and
good will. Sincerely and fraternally
yours. SAMUEL. COMPERS.
President A F of L"
Russians Protest Vigorously.
Constantinople The Russian am
bassador Thursday sent a protest to
his government against the continua
tion of the massacres of Christians
in Asia Minor. He declared Russian
agents sent to Asia Minor report
that 100 Christians have been killed
within the last few days near Alexan
dria alone, and that many of the mur
ders have been committed almost un
der the eyes of the commision thai
was sent to investigate the terrible
slaughter of a few weeks ago.
Grand Vizier Hilmi Pasha has given
fresh pledges that the killing of the
Armenians will be stopped imediate
ly. but the Russian ambassador is
skeptical of the grand vizier's ability
to carry out his pledges.
APPLYING SUKaER KULCttj
Ground Should Be Worked Ovsr Fin
and Deep and Left Fr
All
pfcsats, as
Anxious Over Art Treasures.
Xew York Owners of fine Italian
works of art are trembling for their
treasures as the result here of agents
of the Italian government, searching
for works of old masters which have
been removed from Italy. The agents
claim that the Italian laws which for
bid the removal of rare paintings have
been persistently violated and that
works of the old masters have been re
placed by copies while the originals
have been shipped to America.
While there is no possibility of
claiming any paintings already here,
the Italian agents intend to make a
complete list of paintings in America
for future use.
Before applying the
ground should be worked
and deep and left free front an '
the clippings should them
evenly over the surface. wufUsf
under the leaves of tow give inn
plants and well np around the i'l'sti
of tall ones, as lilies. j
Once placed the mulch should nod
he disturbed, as Its object in to esl
dude light and hoc air
moisture. Left undisturbed
influence of rain and dew it
into a feltlike mat that effectually
courages the growth of weeds. wMl
retaining the moisture, ccotni m uad
friableness of the soil so essential tm
the welfare of the plant.
The mulch most be added to trans
time to time, as the drying out of the
grass renders it much thinner
when applied and beds mach
will require much heavier mwU nlng
than those is partial or
shade. So. too. beds of
growing plants win i exalte i
mulching than tail, robust
the cosmos, eieome, dahffa. mr pev
ennial phlox, which may be ken,
mulched to a depth of eight or tern
inches to advantage, and in as season)
of normal rainfall win require tntle,
if any, watering.
Where a part of a feed ha keen
mulched and the remaining part kft
uncovered and watered it
discovered that the weeds grew
pantly. needing coastal
and that no amount of water
to assuage the thirst of the sofi i
a brilliant sua. while the set! of the
protected port ion of the bed
on turning back the stale, be fa
cool, moist and free from weeds
It Is well, in the Interest nf
Bnesst to add fresh
twice a week
evidence. Where white cloves :
part of the covering of the
effect of the beds covered with
green grass and dainty hTnsniw
crowned with bright Sowers is
lag. Such a mulch. If left sa
ground during winter. wSI motet!
soil and prevent its tracking, and fts
the spring wm have decayed aad mmi
be worked Into the
valuable eJen
The Merrier County
Operative association of Central Cliy.
has awarded a contract for a large ele
vator to the Hampton Elevator tons
pany. It will be located en the rasoa
Pacific right-of-way aad win have a
opacity of lC.ee bnvheht. ft as ex
pected that it win be
a boat sixty days.
'