Columbia University Libraries Digital Collections: The Real Estate Record

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646 RECORD AND GUIDE November 18, 1922 the firing of steam boilers and small-house furnaces. Reserve stocks are being accumulated slowly and are still far below normal for this time of the year. Sub¬ stitutes for coal must be used whenever and wherever possible, especially as the production of anthracite can¬ not possibly amount to more than 60 per cent, of the usual annual output. Soft coal, coke and wood to the extent of twenty-five per cent, should be mixed in with anthracite if suffering is to be avoided when cold weather sets in. These precautions are the physical reminders of a fight that was waged to supersede the law of supply and demand by the dictates of minorities not well in¬ formed and certainly not backed up by public opinion generally. The admirable way in which the various public offi¬ cials and the business men who have co-operated with them have worked to get the country out of the threatening position into which the strikes had brought it should indicate to those who would make over the government into a gigantic community work-shop that common sense, tried business methods and public opinion formed by widespread publicity still can be re¬ lied on to function properly, even in emergencies so critical as that which was brought about by the strikes of last summer. Exercising common sense and business methods, wise public officials and men in commercial life have pulled the country out of the hole into which greedy labor leaders and uncompromising coal operators thrust it. Politics was not allowed to enter into the working out of a sane and highly satisfactory plan for getting coal distributed before severe weather made the task doubly hard. A disagreeable and dangerous situation has been overcome by the exercise of the commonest kind of business sense, and it ought to be possible for these same officials and merchants, having the further aid of the information now being collected by the President's Fact Finding Commission, to draw up and put into operation a plan for the mining and distribution of coal which will not only avert the strike already threatened for next Spring, but which will assure the country permanent relief from this annual attack on its pocketbook, its good nature and its well-being. State Collects $124,000,000 Taxes Other Than Real Estate By WALTER W. LAW, JR. President, New York State Tax Commission FOR fifty years the main problem in taxation has been to distribute an equitable share of the burden to intangible personal property and thus relieve the disproportionate share borne by real estate. Perhaps more progress has been made in this direction in the State of New York than in any other state of the Union. No taxes are welcome for their own sakes. But when it is realized that more than $50,000,000 is collected from corpora¬ tions, $30,000,000 from personal incomes, $15,000,000 from in¬ heritances, $15,000,000 from automobiles and $14,000,000 from mortgages and transfers of stock, and that all these sums would otherwise have to be raised as an additional burden upon real estate, it becomes obvious that we have made some progress toward equalizing the burden. Equity means equality. Equality in taxation means an equal proportionate burden. The constant effort of wise statesman¬ ship is to distribute the burden of taxation fairly and propor¬ tionately upon the various forms of wealth and the holders thereof excepting only in the case of exemptions allowed by law based on well-considered reasons. The two things that are of fundamental importance in taxa¬ tion are (first) the amount of money raised by the taxing au¬ thority, and (second) the distribution of the tax burden among the various taxpayers, because even though the tax levied may be a very moderate one if it is unequally distributed the burden may fall upon the persons of the community who are least able to bear it and thus become more onerous and cause more suffering than even a larger levy which is distrib¬ uted according to the ability of the taxpayers to respond. As to the first point, it must be remembered that government orders its finances differently from individuals. Mr. House¬ holder first determines the amount of his income and then fixes his rent and other living expenses to come within the amount that he can spare. Government does very largely the opposite. It first determines the amount of its expenditures and then looks around for sources of income and fixes the rate of tax levied sufficiently high to pay its anticipated expenditures. Consequently the control of the income is exer¬ cised when the amount of expenditures is fixed. In 1910 the taxes paid in the State of New York amounted to an average payment of $35 per capita. By 1920 tha tax per capita had grown to nearly $95. The total increase amounted to 170 per cent. Where waste and extravagance have occurred there is, of course, no excuse that should be accepted. One fruitful source of high taxes in some localities is the heritage from an overfree use of municipal credit, that is, of issuing long (erm bonds to pay for improvements and services which will not outlast the life of the bonds. Some mayors have been allured by the idea of having the credit of constructing municipal im¬ provements during their terms of office, the cost of which will be borne by subsequent administrations, and it has been calculated that for every dollar realized from the sale of long term municipal bonds it will ultimately cost the taxpayers in principal and interest about $3. Any city that will keep as closely as it can to the pay-as- you-go policy will ultimately be in better circumstances than the city that too freely resorts to the use of her credit even though the former has to wait longer to secure the desired improvements. It should be borne in mind that the money levied by taxa¬ tion is taken from the citizens by soverign authority and is withdrawn from the channels of business, when probably if it was left with the individual it would find its way into in¬ vestment in railroads, factories or other industrial use, by which it would give employment to labor and increase the total wealth of the community. We are all taxpayers, whether we realize it or not. Some of us pay taxes directly to the tax gatherer and some do not, but those who do are very alert and astute in passing on their taxes to the ultimate consumer. The landlord can do thii by including it in the rent he charges the tenant; the factory owner can recoup himself for his taxes by adding a little to the seUing price of his merchandise. Indeed, no small part of the high cost of living today is explained in the rise of the per capita tax from $35 to $94 in the brief interval that has elapsed between 1910 and 1920. The cost of living aflfects labor, the cost of labor necessarily rises as a result of the high cost of living and the high cost of labor in turn increases still more the cost of living.