EDITORIAL 



State Tax Reform 



jt GROUP of public-spirited citizens largely rep- 

 / l resenting civic and women's clubs, clergymen, 

 ^^ ^y ^ J and professors have organized a discussion 

 club known as "Re-thinking Chicago. " This group and 

 the Agricultural Club sponsored a meeting sometime ago 

 in the LaSalle Hotel in which the lAA, Illinois Chamber of 

 Commerce, Illinois Home Bureau Federation and other 

 groups participated. The state tax problem and unemploy- 

 ment relief were the principal subjects considered. 



John C. Watson, representing the lAA, outlined the 

 short-coming of the present taxing system in Illinois with 

 particular reference to the antiquated property tax. He 

 gave persuasive arguments for a constitutional tax amend- 

 ment and taxation according to ability to pay. 



J. Paul Clayton, representing the Illinois C. of C. 

 presented a highly interesting study of mounting state and 

 local taxes, recommended elimination of local taxing units, 

 such as townships, road districts, etc. He suggested con- 

 solidation for the state's 10,000 one-room country schools, 

 and wound up with a plea for sharp reduction of taxes. 



We can all say "Amen" to the last suggestion. But 

 Mr. Clayton otherwise was silent about tax reform, par- 

 ticularly on the question of a progressive state income tax 

 to reduce and replace the present property tax which falls 

 largely on farms, homes and real estate. 



It is a hopeful sign when representative citizens meet 

 to study problems of government. Elimination of some 

 local government units and taxing districts undoubtedly 

 could be accomplished to the benefit of taxpayers. Con- 

 solidation of one-room schools in some cases may also be 

 advisable. But any move to bring these changes about on 

 a wholesale, state-wide scale would be resisted by farmers. 

 And with good reason. 



Consider country schools. Consolidation alone cant 

 make a good school out of two or three or a half dozen 

 poor ones. Neither will consolidation necessarily reduce 

 school taxes. It might easily raise taxes. There is a tend- 

 ency for big units of government to squander taxpayers' 

 money. The closer the taxing body is to the taxpayer and 

 voter, the more careful the taxes are spent. The education, 

 competence and perseverance of the teacher is the principal 

 factor in making a good school. There are hundreds of 

 excellent one- room country schools in Illinois with A-1 

 teachers that measure up to the better city schools. Con- 

 solidation in many communities must await road improve- 

 ment. School buses would be useless on Illinois mud roads 

 when the frost goes out. 



Township, road district and school district administra- 

 tion takes a small percentage of the tax money collected. 

 In well-managed districts, most of the money spent goes 

 for service. Consolidation thus would save little in such 

 districts unless the service were cut. You might abolish 

 boards of supervisors and have three county commissioners 

 as 17 Illinois counties have done. Would the interests of 

 rural people be protected with such a plan in counties dom- 

 inated by large cities? 



It is easy on paper to make out a strong case for 

 "consolidation" and "elimination" to reduce taxes. Actual- 

 ly it is difficult to accomplish for there are many sides to 



the question. Three-fourths of the farmers' taxes go for 

 schools and roads and there is little evidence to support the 

 belief that "consolidation" of schools and "elimination" 

 of local taxing units will make an appreciable dent in the 

 farmers' tax burden. Let us make all worthwhile tax 

 reductions, yes! But why not put first things first and work 

 out a fair taxing system to spread the load more evenly 

 and fairly according to ability to pay. | 



Boon or Boomerang 



ISCOVERY of new oil wells in Clay county, Il- 

 linois and in East Texas indicates that the coun- 

 try's supply of this natural resource is in no im- 

 mediate danger of exhaustion. Each new oil well in- 

 creases the supply, tends to lower the price of petroleum 

 products, and makes the problem of alcohol gas dilution 

 as a method of farm surplus disposal more difficult. 



Only casual study leads to the observation that devel- 

 oping new industrial uses for farm products, while laud- 

 able, cannot be depended upon to maintain satisfactory 

 prices for farm products. In fact, discoveries of the in- 

 dustrial chemist work both ways. Every year substitutes 

 are being found for farm products at the same time new 

 uses are discovered. Rayon made from wood pulp has dis- 

 placed vast quantities of cotton and silk. Cheap motor 

 fuel from crude oil made possible displacing 20,000,000 

 or more horses and mules with tractors. Cocoanut oil used 

 in oleomargerine cuts into the farmers' butter market. 

 Rubberoid and other plastics have displaced much leather. 

 And so on. 



It's all right to whoop it up about the wonders of 

 farm chemurgy but let's not kid ourselves into believing 

 that the chemist is going to keep the farmer on the road to 

 prosperity. The chemist's work is fraught with uncer- 

 tainty. What comes out of his test tubes may be a boon 

 or a boomerang to agriculture. , 



An Englishman On the Tariff 



( iC"^\^ HE protective tariff policy of the United States 

 ^^-— ^ has subsidized your manufacturing industries 

 ^^ at the expense of the American farmer." 

 This statement was made recently not by a farm 

 leader but by Sir Charles Morgan-Webb, British economist, 

 of London. Amplifying his statement, he said that the 

 American farmer has a large stake in foreign trade and 

 foreign outlets for surplus farm products. Barring the 

 importation of factory-made goods from European coun- 

 tries by high tariff walls. Sir Charles holds, has not only 

 raised the prices of things the American farmer buys but 

 also has restricted the foreign market for American farm 

 products. 



To the extent that profits in protected industries have 

 been passed on to labor in the form of higher wages, 

 the farmers' market has benefited. Well-paid workmen 

 buy more meat, milk and groceries than unemployed or 

 poorly paid workmen. But the disadvantages of high in- 

 dustrial tariffs to the farmer outweigh the advantages. 

 Therefore American agriculture is fully justified in de- 

 manding legislation to protect farm prices as effectively as 

 the tariff protects industrial prices. J 



L A. A. RECORD 



