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Show Townsend Plan Perils Revealed Economist Explains How Its Taxes Would Wreck Country. By OR. WALTER E. 6PAHR Chairman, Ospartmtnt of Econom. let, Nw York University and Msmbsr of th National Advisory Ad-visory Council of tha Amtr can Liberty Lsagut. The Townseod Plan subscribes to the notion that organized society Is under some obligation to pension people who are quite able to continue con-tinue useful work ami to take care of themselves. The whole plan Is a blow aimed, wittingly or not, at prudent and useful living, at saving, sav-ing, at Investment, at Insurance. If It were conceivable that congress con-gress could be so utterly foolish as to enact this plan Into law, the gov eminent probably could (Hid no market mar-ket for It bonds. With savings destroyed, de-stroyed, who would buy the bonds? With a collapse In bond prices, our banks also would collapse because of their very heavy Investments In such bonds. Insurance companies would have to dump their securities on the markets mar-kets to uieet the demands of their policy holders who would wish to convert their pollclea Into cash, for who would wish to Insure against old age? Savings banks also would have to dump securities on the markets mar-kets to meet the demands of their depositors, for who would wish to save for old age? Moreover, people could not save. With all these securities se-curities dumped on the market, who could buy them? The markets would collapse, the banks would fold up, the Insurance companies would be wiped out. All who own securities would And the values of their holdings driven to the zero point. Taxes Would Doom Business. The taxes ou businesses would wreck them. The taxes on the farmers farm-ers would be io high they could not afford to farm. The average, laborer labor-er could not afford to labor. Grandpa Grand-pa and Grandma could support three laborer! besides themselves, without any work, and all five of the group would be better off than the average laborer today. That la a picture of what would happen. Cln anyone Imagine a congressman with such characteristics characteris-tics that he will advocate a thing of this sort? Yet there are some Individual of Just this type who are finding their way Into coogress ! Nation's Virtues Undermined. One of the very startling things which this country has been compelled com-pelled to witness during the last few years, especially during the last two or three, has been a constant undermining under-mining of the well-known virtues of hard work, thrift, saving, investment invest-ment and Insurance. In opposition to these great aud good institutions, which have provided some of the best elements In our American life, we have been seeing agitations for less work, movements which tend to penalize thrift and to endanger savings, Hnd the notion that the world owes one a living regardless of whether one works or saves or exercises any prudence In preparing for old age and the uncertainties of life. The reasoning underlying the Townsend plan la a characteristic part of this brand of unhealthy thinking. It (lies in the face of the most elemental lessons learned by people after thousands of years of experience. It runs counter to what Mould be the most ordinary common com-mon sense. |