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Show THE GOOSE IS IN DANGER In a recent column, Hugh Johnson commented on the law of diminishing returns. The basic tenet of that law, he said, "is that rates of taxation can be so high as to discourage our business and other incentives to create wealth. "Tax rates above this limit no matter how high they go will result in lower rather than greater revenue to the taxing source, and the decline in revenue will go relatively fuster and farther than the increase in rates of taxation." With taxation paramount in the headlines, next to war, and with congress debating the new treasury revenue bill, it should be thoroughly understood by everyone that we have reached the point of killing the goose that lays the golden egg. The government can tax the golden egg out of existence. But it can't create a new goose. The government can tax productive industry to the point where all incentive to progress is destroyed. And the government and the people peo-ple will find that the very foundation of individual freedom and opportunity has also been destroyed. Progress comes out of risk. Men take chances. They play long shots, in. the hope of making a profit. Every great industry we know was a "long shot" gamble once. Motors electric power oil mining go down the list, and you'll find that all these vast enterprises were little experimental enterprises once. "Risk capital" made them possible and so made possible this kind of a country. Taxation can be so applied that the ability to progress will disappear. If the so-called "excess profits" tax is so increased in-creased that business is deprived of the money needed for expansion, experiment and development, production will seriously seri-ously suffer. These are facts which congress must keep in mind. Today's tax problem amounts to raising the needed revenue without destroying the economic and social system we are battling to preserve. |
