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Show ardund the NATIONAL CAPITAL- Carter Field y Washington Nervous store owners, big and little, are wondering what sort of report the commission commis-sion sent to Europe by President Roosevelt to study co operatives will make. Some of the brain trusters are reported to have cooled off considerably con-siderably since the dispatch of the Due to the exposure of Mr. Morgan's Mor-gan's failure to pay income taxes it certain years when he nad heavy losses, however, the American capital cap-ital gains end losses was changed to "head:- I win tails you lose" plan. Profit and Loss The taxpayer still has to pay the full Income tax on any profits made by sales. But he can deduct losses up to only $2,000 net tor any one year. So if you make $10,000 on selling some property one year, you pay full taxes on that $10,000, which probably shoots you up into pretty stiff surtaxes. But if you lose $10,000 the next year on similar sales you can deduct de-duct only $2,000 from your Income in computing the Income tax. Politically, of course, the theory ' was that the $2,000 exemption would ' let out all the small fry, and there commission. At first blush, after Secretary of Agriculture Henry A. Wallace's book "Whose Consti-tution" Consti-tution" came out it struck them as a splendid idea. In fact that was why the President sent the commission commis-sion to Europe to determine firsthand first-hand what had happened to the experiments ex-periments along that line over there. . iU It seems a safe prediction for the moment that no report calculated to alarm the merchandizinK business busi-ness of this country will be allowed to come out before election. If some of the remarks being made about the whole Idea in inside administration adminis-tration circles are Indicative of the general official attitude, tradesmen need not worry at alL But there is no way of telling. Wallace does not change his mind very rapidly, as quite a few Brain Trusters and others have discovered. dis-covered. He is still Secretary of Agriculture, having survived battles bat-tles with George N. Peek, contact with Rexford G. Tugwell, and sharpshooting from many others. And obviously Wallace had given considerabe thought to the subject before insisting on its necessity so positively in his book. His idea is very simple. Long a strong advocate of farmer co-operatives, many of which have been very successful, Wallace is pursuing the same objective in promoting were not enough of the big leuows to make an effective protest But now the Treasury wants to change the whole thing, go to the British system, for reasons having no connection whatever with the political change effected after Mr. Morgan's testimony had surprised the country. The Treasury's studied conviction is that It costs more to collect this capital gains and losses part of the income than it is worthl It is not disturbed by the enormous enor-mous trouble to which it puts the man or woman making out an income in-come tax checking the date on which the property or securities, I were bought the exact price, less commission, etc.. and then the date of sale, less expenses, etc. But it is highly disturbed by the tremendous Job of going over these returns, checking them for error, and then checking back to the original sources to discover if the taxpayer is (1) correct in his calculation and (2) honest In making them. Of course, tens jf thousands of such returns are from people who do not pay any Income tax at all. Their gross income exceeds the minimum at which a return is required, but their exemptions bring them below the taxpaymg level. Politically, however, a real scrap may develop. consumer co-operatives. It's the age old target the spread between what the farmer gets and what the consumer pays. Lack Big Names Lack of nationally known names of the right political and geographical geographi-cal background is one of the reasons why there is so much pressure on Governor Alfred M. Landon to change his campaign tactics, go after af-ter President Roosevelt roughshod, and make what might be called a "rousing" campaign. The Democrats have a wealth of such names. Vice President John N. Garner does not allow his name to be used much did not in the 1932 campaign but Aere arc plenty of otheis. From the standpoint of Democratic campaign strategy there is no geographical barrier; a Both Helpless In the WPA produced play. "Triple A Plowed Under," being put on in a number of theaters by WPA casts throughout the country, there is one scene bearing on this. The farmer comes up to a greedy looking individual seated at a table with a quart bottle of milk. "How much do I get?" he asks. "Three cents," says the middleman. middle-man. Commenting that it cost him more than that to produce, the farmer says: "I'll take it" A second later a poor looking woman comes up with a bottle. "How much is a quart of milk?" she asks. "Fifteen cents," says the middle- ""That is all I have, but I'll take It," she says sorrowfully. The point of the act being that both producer and consumer are helpless, having no alternative. Part of the trouble. Mr. Wallace believes, is solved by farmer cooperatives. co-operatives. . But though these have been successful the fact remains that there is still a wide spread remaining between what the farmer gets even through a co-operative and what the consumer pays. So Mr. Wallace wants to reduce this sDread by having the con- man from Maine is Just as goou as a man from Texas. There was a time when the Democratic Demo-cratic publicity bureau might have hesitated to use the name of Senator William G. McAdoo. for example. Too many people were bitter against him because of the fight that developed at Madison Square Garden, with its religious background, back-ground, There was a time when the Democrats would have hesitated to use the names of a lot of Southern senators and prominent house members. mem-bers. They feared the cry of "Southern "South-ern domination" might be raised against them in the South and West It is rather curious how such things rise, become Important and just fade away. But it just so happens hap-pens that in this campaign the Democratic Dem-ocratic party is not disturbed at possible reactions agaiit any of its possible speakers or givers of sumers organize too. So the much berated milk trust may find itself with a few TVA type of yardsticks applied to its profits, to determine whether its profits are not much too large. Income Tax Treasury Department experts have about reached the conclusion that they would like to have the so-called capital gains and losses section of the income tax repealed. Great Britain has never had such a provision, and, our Treasury experts ex-perts think has not suffered for its lack. It will be recalled that the whole country was shocked, a few years ago, when it discovered that J. Pierpont Morgan had not paid any American Income tax for several year, in the early part of the depression, de-pression, though he had paid taxe. in Great Britain for the same years. Simply stated the point is this. If an American bought a residence r.r ssnoo in 1927. and sold that interviews because 01 racuonai groups or geography. Whereas the Republicans are handicapped both ways. There is the most earnest effort to retain the AU Western complexion for the Republican ticket that developed de-veloped at the Cleveland convention. There is also an equally earnest effort to supress most of the old guard names, or anything associated as-sociated in the mind with them. Serious Problem As there are few nationally known Republicans in the South which carry any weight and as the new crop of Republican leaders both East and West have not had sufficient suf-ficient advertising to make them carry much weight with the desired de-sired audience, the problem is very seious indeed. Three of the best known names among Republican senators, James Couzens of Michigan, Hiram W. Johnson of California, and George W. Norris of Nebraska, are supporting sup-porting Roosevelt When the list of prominent Republicans Repub-licans is whittled down, outside the two candidates and the chairman of the Republican National committee, there is only one which stands out with sufficient prominence, and to whom there is no objection. This is Senator 'Arthur H. Vandenberg of Michigan. There is Herbert C Hoover, of course, prominent indeed, in-deed, but also with serious liabilities liabili-ties in that so many people are so strongly against him. Anyway, wha the Republicans want la not a comparison com-parison of Roosevelt days with Hoover days, but with Coolidge days. All of which explain, in part at least why o much of the speec making on the Republican side this campaign up to date has been dons by the National Chairman John D. M. Hamilton. Bell Syndicate. WNU Service. property in 1929 for $9,000, his income in-come tax return made on March 15, 1930, must show a profit of S3.000. which would be taxable as income for that year. Or if the buyer of that house sold it in 1932 for $4,000. he could deduct his loss, $5,000. from his 1932 income in-come as reported in March, 1933. Precisely the same i. true of profit, or losses on stocks, bonds or any other property. Whereas in Great Britain that sort of thing is regarded as capital not income and neither profits are charged as income for any particular par-ticular year, nor losses allowed as deductions from income for the year In which the deal was con- eluded. Economists geu orally have agreed that the British system Is more equitable, does not subject the taxpayer to piled up taxation in one year, does not encourage booms, and for many other reasons. |