January 10, 1921 



HARDWOOD RECORD 



25 



The proposed excess tax on the privilege of holiling liind and natural 

 resources is simply the old Henry George idea slightly disguised. It has 

 been discredited by a majority o£ thinking men. Our companies are large 

 holders, naturally, of cutover lands, hut instead of trying to keep them 

 away from those who will till them, we are spending large sums annually 

 to bring them to the knowledge of such people and to get them into their 

 possession. If we were rnquirod to pay an excess tax on our holdings 

 of cutover hinds, we would .simply be obliged to add the amount of that 

 excess tax to the amount paid us by the settlers. In other words, the 

 settlers would pay it, and not ourselves. I think, therefore, that this tax 

 will be placed at exactly the wrong place and on the wrong people, as we 

 ought to do everything in this country to encourage people to go on 

 the land. 



It would also be unjust as applied to standing timber. The large com- 

 panies which have from fifteen to twenty years cut ahead of the .saw are 

 the companies which today are conserving the tijnber. They bring out of 

 the woods everything down to a four-inch top, in both softwoods and hard- 

 woods, while the small sawmill owner skims the cream of the timber in 

 order to make an immediate larger profit. A tax which would increase 

 the cost of producing lumber would tend to make the large companies look 

 for immediate returns in order to pay the tax, and if they looked for 

 Immediate returns they could not afford to utilize so much of the log as 

 they are now utilizing, and thus the country's supply of timber w<iuld be 

 more rapidly used. 



K. A. Long's Views 



R. A. Long of Kansas CitVj president and general manager of the 

 Long-Bell Lumber Company, was brief in the expression of his 

 views. He said: 



I have read with interest your letter of November 23, and appreciate 

 the compliment implied in the request for an expression of opinion from 

 me as to the changes which should be made in the existing Fetleral tax 

 laws. I regret that I cannot write you as requested. This, it is hardly 

 necessary for me to say, is due to no lack of interest in the subject, but 

 rather to the conviction that it is so broad and requires a consideration 

 or so many important factors I do not think I am prepared to make a 

 recommendation. 



For example, we all agree that the excess profits tax is exceedingly 

 -objectionable and should be repealed, and yet at the same time a tre- 

 mendous amount of revenue must be raised each year by the Government, 

 and no one is prepared to come forward with a substitute. Even Otto 

 Kalin, who has written and spoken about the subject as much as any 

 other one man, expressed himself, after months of study of it, as being up to 

 that time undecided about the merits of the sales tax. Since then he has 

 come out against it. But llr. Kahn has not yet, to his satisfaction, found 

 a substitute for the laws which he thinks should l>e repealed, notwithstand- 

 ing the great amount of study he has given the subject. 



While I cannot recommend any particular plan of taxation, I do feel that 

 Congress, at the very earliest opportunity, should take up the subject in 

 the most serious and thorough manner, and surveying the situation and 

 acquainting itself with the Government's indispensable needs, should 

 proceed to enact a law to raise the revenue, which will be as simple as 

 possible, and, of course, equal anil uniform as to all taxpayers. 

 From James E. Stark of Memphis 



James E. Stark, president of James E. Stark & Company, Inc., of 

 Memphis, and chairman of the executive committee of the American 

 Hardwood Manufacturers' Association, made the following brief 

 •comments: 



This is such a very large question that I do not feel competent to express 

 a very definite opinion. I, however, have read a number of articles on a 

 revision of our Federal income tax, and it seems to me the most logical 

 plan would be to repeal the excess profits tax and substitute In place of 

 it the gross turn over tax. 



As stated above. I do not feel competent to express a definite opinion, 

 but it seems to me that this is the most equitable way of distributing a 

 tax of this kind among the country as a whole. There may I>e some objec- 

 tion to it that I am not familiar with, but it does not seem as though it 

 would have the tendency to restrict enterprise by putting an unfair tax 

 on it. Certainly anything is preferable to the present taxation laws. In 

 the first place they are so complicated that they cannot be understood, 

 and even the Government cannot itself interpret them, which is evident 

 by its numerous changes in the interpretation. 



The present law does not give a taxpayer an opportunity of being heard 

 on the merits of his claim in case there is a difference of opinion, but he 

 is only accorded the opportunity of presenting it and having it passed on 

 by some clerk who probably is not acquaintaned with the line of business 

 in question and passes on it in an arbitrary manner without respect to the 

 justice of the claim. 



Certainly a new law along different lines would help to create a better 

 feeling between the taxpayer ;inil the Federal (iovernmcnt. 

 A. L. Osbom's Views 



A. L. Osborn of Oshkosli, Wis., who is one of the leaders in the 

 consideration of Governmental problems in the National Lumber 

 Manufacturers' Association and the Northern Hemlock and Hard- 

 wood Manufacturers' Association, said: 



I confess that if it were left to me to write a revenue measure fair 

 alike to all who might be called on to pay taxes that I would be uttei-ly 

 unable to meet the issue, and unlike everybody else in the United States, 

 as far as I know, I am not able to make up my mind as to what sort of 

 reform we should have of present taxing methods. I imderstand every- 

 one else has a ready remedy for the present unsatisfactory method of rais- 

 ing taxe-s. They all want the other fellow to pay the tax. 



I believe, though I cannot l.iack it up with a very strong argument, that 

 the excess profits tax ought to l)e repealed. To get that far is easy ; to go 

 farther with me is difficult. What to substitute in place of an excess 

 profits tax is hard for me to determine and then justify my conclusion. 

 I suspect that a sales tax would be about the best way of raising the 

 money that can he devised, but I can see that if it starts at the beginning 

 with raw material and goes through to the end that it will not make a 

 very happy distribution of the tax burden. 



I am a good deal stronger in my convictions .as to what we ought not to 

 have than w^hat we should have. The Rawlston-Xolan measure, as I 

 understanil it. is only intended to shift a burden from one class of people 

 to another class and thereby appreciate the value of the property of one 

 class of people and very radically depreciate the value of the property of 

 another class of people. There is no greater iniquity in legislation than 

 to constantly change the value of property by shifting tax or other bur- 

 dens from one class of property to another. Property that is acquired 

 under a law or a set of laws that has value because of its earning capacity 

 under the law should not be rendered of less value or valueless by a shift 

 of burden relieving one class of property and putting it on another. 



Personally I am not very strong at present for a reduction in sur- 

 taxes, first, because I think we will get nowhere with it, because .someone 

 must pay for the war, and those who have enormous incomes coming per- 

 sonally to them can well afford to pay the tax, and at the same time there 

 will not be a loss of the invested capital necessary to keep up production. 



I do not think we ought to have an increase in stamp duties, and do not 

 favor many and petty exactions that irritate without producing much 

 revenue. I do not think we ought to change our postal rate to secure 

 more revenue nor do I think postal rates ought to be reduced. I feel that 

 periodicals should pay what it costs for their transportation and delivery 

 under the postal laws. 



This is perhaps an unsatisfactory view. I wish I had more wisdom 

 and more confidence. 



Lumber Unites to Revive Building 



[Continued from page 20) 

 adjourned to a large room at the Auditorium Hotel, because of 

 tlie size of the attendance. 



There R. E. Saberson of the Thomj^son Yards, Minneapolis, Minn., 

 described the publicity campaign conducted by the Northern Pine 

 Manufacturers Association, giving particular attention to the 

 methods of the campaign and the content of the copy used. Mr. 

 Carpenter then followed with an explanation of the results of the 

 campaign, which he recorded as successful. 



Thereafter upon the basis of this campaign the members of the 

 mass meeting debated the question of extending this campaign, or 

 some campaign of publicity along similar lines, to the entire coun- 

 try, to the end that the public in all communities might be put 

 in the right frame of mind for building. The debate, which con- 

 tinued throughout the first day of the meeting culminated in the 

 appointment of tlie committee on resolutions and their findings, 

 which were unanimously adopted. 



Among the participants in the debate were Dr. Wilson Compton, 

 secretary of the National Hardwood Manufacturers Association; 

 Mr. Rhodes, secretary of the Southern Pine Association; George 

 Watson, secretary of the Southern Cypress Manufacturers Asso- 

 ciation; L. R. Putnam, managing director of the American Whole- 

 sale Lumber Association; Mr. Bannister, Mr. Schoeflin; George A. 

 Townshend, Great Southern Lumber Company, Bogalusa, La.; Mr. 

 Gilchrist, Mr. Bloedel and Mr. Blodgett. 



Kirby Closes Debate 



The debate was closed by John H. Kirby, president of the 

 National Lumber Manufacturers Association, who spoke, however, 

 in his private capacity. 



Mr. Kirby urged that the lumber industry adopt common 

 sense and conservative methods in its campaign to advise the pub- 

 lic of the favorable position of lumber for general building activity. 

 "High prices, labor and so forth are others problems," he said. 

 "We can only advise that lumber has reached prices below cost 

 of production, creating a most favorable market for the purchase 

 of lumber." 



