OLEOMARGARINE AND OTHER IMITATION DAIRY PRODUCTS. XIII 



other than the public needs. As was said by the Supreme Court of 

 the United States, in Loan Association v. Topeka (20 Wallace, 664), 

 "To lay with one hand the power of the Government on the property 

 of the citizen and with the other to bestow it upon favored individuals 

 to aid private enterprises and build up private fortunes is none the 

 less a robbery because it is done under the forms of law and is called 

 taxation." While under the proposed bill the object is not to donate 

 the taxes which may be raised to aid a particular industry, yet the 

 imposition of the tax is for the purpose of enabling one industry to 

 sell its products free from competition with another, and thus to exact 

 from the public an increased price for the product, not for the benefit 

 of the public Treasury but for private purposes solely. The effect upon 

 the people is the same in both cases. As was stated in the opinion of the 

 Supreme Court in the Topeka case, "there can be no lawful tax which 

 is not laid for a public purpose." This doctrine is so well recognized 

 that it is unnecessary to produce further authorities upon the subject. 

 There is no conflict of judicial opinions; all are in harmony with the 

 opinion in the Topeka case. 



The proposed bill is class legislation of the most dangerous character. 

 It is not demanded by any existing economic conditions in this country, 

 and its passage would be a perversion of the taxing power of the Gov- 

 ernment, and a violation of the Constitution, both in its letter and 

 spirit. 



The Hon. Lyman J. Gage, Secretary of the Treasury, was invited 

 to come before the committee and give his view from a revenue stand- 

 point. The following is a part of his testimony: 



Secretary GAGE. Of course I only feel at liberty to state my views as the Secretary 

 of the Treasury, and only upon that part of the bill which involves the question of 

 revenue. I might have personal views which go far beyond those; but you would 

 probably not care much about them. 



There is, in my opinion, an objection to the bill 011 either theory. If it is a rev- 

 enue producer, it is superfluous ; we do not need it. If it is not a revenue producer, 

 then the title of the bill is a misnomer, and it is inoperative in the name of revenue. 

 It seems to me that on either theory there are serious objections to it. 



I think that covers all I care to say directly on the subject. 

 ******* 



The ACTING CHAIRMAN. Mr. Secretary, can you tell us what has been the experi- 

 ence, in a general way, of your Department in the collection of the revenue on oleo- 

 margarine? You know, of course, that there is now a 2-cent tax on it. 



Secretary GAGE. Yes, sir; I think the revenue is well collected. There has been 

 considerable discussion of that subject between the Commissioner of Internal Rev- 

 enue (especially Commissioner Wilson) and myself, at different times; and we think 

 we are cheated to some extent, as we are in all revenue matters. 



******* 



Senator BATE. Then I suppose the losses in oleomargarine internal-revenue col- 

 lections are about on a par with the losses in all other revenue collections? 



Secretary GAGE. Well, they are on a par with the losses in most of the revenue 

 collections. - There is not any great disparity. 



******* 



^ Senator ALLEN. Of course the liquor can not go out without the consent of the 

 Government? 



Secretary GAGE. No, sir; but the tax on liquor is $1.10 a gallon, while that onbut- 

 terine is 2 cents per pound, so that the temptation is very much greater in the one 

 case than in the other. 



Senator ALLEN. The only thing with which you are concerned is the tax? 



Secretary GAGE. That is the main thing, of course. 



Senator MONEY. The remark you have just made, Mr. Secretary, suggests this 

 question: You say the greater the tax the greater the incentive to fraud. The same 

 rule would apply here, would it not? 



Secretary GAGE. Undoubtedly. 



