Evening star. [volume], June 16, 1937, Page A-11, Image 11

About Evening star. [volume] (Washington, D.C.) 1854-1972

Image provided by: Library of Congress, Washington, DC

                
Mrs. Roosevelt
and Tax on
Charity
Law Bars Transfer of
"Income” Without
Paying Levy. *
BY DAVID LAWRENCE.
Mrs. franklin d. roose
VELT discussed with the
newspaper correspondents a
day or so ago her income tax
returns, and said:
"On every penny of income I have
received I've paid my full tax.”
Unfortunately, no other taxpayers
enjoy the ad
vantage which
Mrs. Roosevelt
has, for other
taxpayers must
not only pay
taxes on every
penny they re
c e i v e. but on
every penny they
earn.
Mrs. Roosevelt
has told the pub
lic that all of the
income she earns
by speaking over
the radio goes to „ ...
, ” David Lawrence,
charity. Early in
3933 the question of taxes came up and
a contract was entered into with the
agent by which Mrs. Roosevelt agreed
to speak over the radio for a certain
fee for each broadcast and the checks
for the services she rendered were
to be made out directly to the charities
she designated.
Rulings Are Strict.
Now, under the rulings of the Bu
reau of Internal Revenue, taxes have
to be paid not only on actual money
received, but on what is known as
& "constructive receipt." As for the
assignment of income to third par
ties, the official ruling of the bureau
is as follows:
"Cases in which one person con
tracts to perform services for a sec
ond person, and it is agreed that the
remuneration therefor shall be paid
to a third party, the receipt of the
third party must be held to be a
constructive receipt by the person per
forming the services.
"Income, whether it is derived from
labor, from the use of capital, or from
the sale of capital assets is n each
case income, and the Same rules with
regard to constructive receipt apply
in all cases.
"The ruling as above set forth rep
resents the position which this office
has consistently held."
Other Taxpayers Would Fail.
Undoubtedly Mrs. Roosevelt has in
terpreted the law as it ought to be.
end most people will concur in her
view that if she doesn’t actually
receive the money she ought not to
pay taxes upon it. But the rules of
the Internal Revenue Bureau are the
law today, and other taxpayers who
attempt to assign their income to a
third party and thus-have it excluded
from their own gross income would
probably come into collision with the
Internal Revenue Bureau.
The fact that the taxpayer does
not actually possess the money for a
single instant does not seem to have
altered the view which the courts
have held of such cases. Thus the
late Justice Oliver Wendell Holmes,
the great liberal, speaking on behalf
of a unanimous Supreme Court of
the United States, dealt with this
aspect of the matter in a certain case
several years ago when he said in a
formal opinion:
“There is no doubt that the statute
could tax salaries to those who earned
them and provide that the tax could
not be escaped by anticipatory ar
rangements and contracts however
skillfully devised to prevent the sal
ary when paid from vesting even
for a second in the man who earned it.
“That seems to us to be th< bnport
of the statute before us, and we think
that no distinction can be taken ac
cording to the motives leading to
the arrangement by which the fruits
are attributed to a different tree
from that on which they grew."
Earned $90,000 in One Year.
Mrs. Roosevelt is lucky that she
can assign checks to charity amount
ing to so large a part of the income
from the services she renders and
avoid taxation herself. In one year
she is estimated to have earned
$90,000 for charities. Any other in
dividual would be in hot water if he
diverted so large a part of his in
come to charity. The law' allows 15
per cent deduction for charity. In
Other words, out of the $90,000 earned
by Mrs. Roosevelt, for example, she
rouid deduct about a little less than
one-sixth as a charity deduction, and
-on the balanced, namely, about $76.
*00, she would have to pay a per
sonal tax, and then from whatever
•he had left after the payment of a
she could give as much to charity
as the desired.
What Mrs. Roosevelt may not have
discovered as yet is that the Govern
ment of the United States assumes
the right to do its own charity giving,
snd that the taxpayer is gradually
losing that privilege because of the
large wms taken in taxes. Only 15
per cent k the allowable deduction*
now for charity. If the case of Mrs.
LUMBER
For Any Repairing or Remodeling
Soft Pine shelTlnr, g^
asT” svzc ft.
2x I, 2x6. 2x8 L*ine Framinr, C Cl
10' to 16' lenfths __ |
Cedar Fence C C _
Post, bbc up I
2x4, 2x(i, 2x8 Cieorrii Q I / , fi 2
Heart Pine _ /2C II* g
Best Quality % Q. Cl %
Oak Floorinf **• '$
Best Quality SoN Pine *0 i A *
Window Frames_ spj.'tU Up |
Windows - $2.30 UP J
Fiber Wallboard, square O 1 / _ 5
foot _72 C ^
H-Inch Fir Plrwesd. 2t to 48 C- 2
Inches wide. Squire foot_ "*■
uiarei
J. FRANK
_ FREE DEUVERY
■jjjP® fl| ■ 4B We any alie
^BB ■ order free of
K[ ^B am H Buy now before prices
■■■ HhB H ro
INC.
LUMBER-MILLWORK
Paints, Hardware, Sand, Gravel, Cement
2121 Ga. Ave. North 1341
1
What’s Back of It All
Robinson Vetoes 90-Day Vacation Plan Suggested
by President to Win Support.
BY H. R. BAUKHAGE.
NEW piece of White House strategy to smash opposition on Capitol
Hill has come to a sudden and unexpected end.
The President called in his "old faithful,” Senate Majority
Leader Joe Robinson, and suggested a 90-day recess for
Congress.
The idea was to let the tax evasion investigation and the heat
keep the public's mind off a number of tittle private gatherings
where recalcitrant Congressmen, under a cooling palm, might be
made to see the light. A few intimate conversations, perhaps on the
deck of a yacht or elsewhere.
But Senator Robinson, stealing Vice President Garner's stuff as chief
"no-man,” injected a “no” of his
own.
It just couldn't be risked, he
said. If the boys ever had a chance
to get back to the grass roots,
heaven knows when they could be
rounded up.
And so, the court bill, Govern
ment reorganization, relief and
kindred matters will probably be
droned out on the floors of both
our Houses, if it takes all Summer.
The President will get what relaxation he can witn trips to Hyde Park.
* * + *
The cloud of dust left by that "mile-long'’ car of Vice President
Garner, as he burned the highways for Uvalde, set a lot of eyes smarting.
The official reason for his departure, with the court bill and the
rest of the "ought" legislation hanging high, is that he needs a rest.
The other one is just that the President's No. 1 "no-man" is tired
of saying “no” to no avail.
On party matters, the Texan sees eye to eye with Fellow Party
Member Roosevelt. But when it comes to looking some of the New
Deal legislation in the face, he prefers the horned toads of his
native State.
The Vice President's last official act before departing gave one New
Deal agency, now rather busy dodging the dead cats, a considerable jolt.
In response to a Senate resolution, he named a committee of five
Senators to investigate Harry Hopkins' relief organization. Looking them
over, they don’t look so sweet to Mr. Hopkins. Only one could be classified
as a supporter of the relief administration—Senator Hatch of New Mexico,
a Democrat. The rest regard relief a la Hopkins with a somewhat fishy
eye. They are Senator Byrnes of South Carolina, the chairman, and
Senators Clark of Missouri, Frazier of North Dakota and Davis of
Pennsylvania.
* * * *
Reports of Secretary of the Interior Ickes’ imminent resignation
are about aue again, one oi tne
harciest working of the New Deal's
workhorses. Mr. Ickes is ill. From
his sick bed at Naval Hospital he
is carrying on business, which
isn't helping his recovery.
Charlie West, Undersecretary
of the Interior and likewise ace
liaison man between the White
House and Congress, has been try
ing to run the multifold depart
ment. But he is having a tough
JosT <
LCTIft —
TPT To ~
‘J
* V'
Ccrt&cessr^ I
time because the final oaay nas to come irom uie cmei.
This is not the only difficulty Mr. West has. All the routine
business has been routed by Mr. Ickes through Administrative As
sistant Burlew. It is not a secret that this "career” official has
many ideas which run counter to administration innovations in
the department.
Mr. West has to catch as catch can. And when sometimes he has to
make an instant decision, he finds that he is reversed by the Secretary
himself.
* * * *
Those who say the President doesn't mix with enough representatives
of business noted that Thomas Watson, president of the International
Business Machine Corp- and a member of the board of the United States
Chamber of Commerce, dropped in for a visit at the White House the other
day on his way to the Paris Exposition.
Mr, Watson's machines are among those which have made possible
some of the astronomical calculations and records required by New Deal
agencies.
They help turn out triple-A rhecks to farmers, W. P. A. rhecks to
workers and handle the complicated and multifarious records of the Social
Security Board.
★ * * aft
“What would happen to me If I got out and stopped that mail truck?"
Just a Washington taxi driver's reaction to the controversy over the
interference with the mails by strikers.
^Copyright in:’.?, hv thp North American Newspaper Allianrr Inc >I
Roosevelt serves to emphasize that
a taxpayer ought to be able to escape
taxes if he gives all his income to
charity, every charitable institution,
university, hospital and community
chest in the country would rejoice.
Perhaps Mrs. Roosevelt's interpreta
tion of the law will lead to an amend
ment by the Bureau of Internal Reve
nue of the rules that apply to other
taxpayers who do not enjoy the pres
tige and prominence In official life
that is enjoyed by a member of the
President's own family.
(Copyright. 1937.)
-«
STUDENTS GIVE OPINION
ON COURT IN EXAMS
Future Citizens Asked to Discuss
Importance of Judiciary in
U. S. System.
By the Associated Press.
ALBANY, N. Y., June 16.—Several
hundred thousand of New York State's
future voters recorded yesterday in
black and white their opinions of the
United States Supreme Court.
The future citizens took the business
of airing their views seriously, too—
for it was all part of the annual re
gents examinations which began yes
terday in high schools throughout the
State.
The opportunity for comment on
the Supreme Court offered by a ques
tion instructing American history stu
dents to “discuss the importance” of
the tribunal “in our system of gov
ernment.”
The required discussion was only
half of the program, however, for after
giving their opinions, the students
were asked to “give two recent deci
sions of the Supreme Court and dis
cuss the importance of each.”
Mi i
JUilLi
'’*'325^ ■
PACKARD RAZOR I
l *. .« .«■> » “• SOc a M eek |
MAN'S BE?Sl $A 95
i his O
«£ b«one. ^ fl Week
1R0NS0N MASTERCAS50
50c a Week
SWANK SETS
$1.95 to $5.00
Every man can use
a dress set or col
lar and tie set. Buy It
from Kay's.
The nationally famous pen which requires no ink. Spe
cially made so that all you need to do is fill with water.
50c A WEEK
CAMEL
PEN
MAN'S RYTIME
Sturdy and handsome de
sign for men. with genuine
leather strap.
50c A WEEK
MAN'S GLADSTONE
Genuine Leather
Fine, durable baa that every
man cen use. A altt that
will really please him.
50c A WEEK
May
409 7th St. I\.W.
Store Air-Conditioned
Mil
JGrand
Canyon
cm. youfe emu/
to- o*i tlom—
• The clean, cool restfulness of Santa Fe’s air-conditioned
! trains has brought new pleasure to summer transconti*
i nental travel. And that pleasure can be increased again by
including one or more of those delightful stopovers pos
sible in the Santa Fe Southwest:
GRAND CANYON • Via Santa Fe, this summer, you will find
daily through air-conditioned Pullmans, direct to the rim; lajt
year's record low fares; all-expense Canyon tours in great variety.
Walks, bridle paths, rim drives—all are at their best. There is
another spectacular inner-Canyon saddle trail, a tug swimming
pool at Phantom Ranch, in the Canyon depths. DUDE RANCHES
• A dude ranch, of course, may be your summer’s main objective.
But if not, and you can still spare a week for one, you w!Q fipd
the experience big in fun and tonic. There are scores of ranchcnko
Santa Fe territory. INDIAN-DETOURS • Lei urely, comfort
able, intimate, these motor explorations through the still-unspoiled
Spanish-Indian country surrounding historic Santa F£, New Mex
ico, itself so picturesque, have proven as enjoyable as they are edu
cational, to thousands of Santa Fe patrons. Economical they are,
too, with one, two, or three nights at beautiful La Fonda Hotel.
«4 5 Daily Train* to California • Summer Fare* at Their Lowest
G. C. DILLARD, Ditt. Pus. Agent, SANTA FE RY.
302 Franklin Trust Bldg , PHILADELPHIA, PA. Phon#« Rittenhouae 1464-1469
Send me Grand Canyon, Dude Ranch and Indian-detours folders, with informa
|G don on fares
from-to____ _... -
| Name___Addreia...—......
CTHE opinions of the writers on this page are their own, not
L necessarily The Star’s. Such opinions are presented in
The Star’s effort to give all sides of questions of interest to its
readers, although such opinions may be contradictory among
themselves and directly opposed to The Star’s.
Labor Democracy’s Sham
Coercion Over Minorities in Workers’ Struggle
Needs Action by Congress.
BY DOROTHY' THOMPSON.
WE ARE engaged in civil war
in Michigan, Indiana and
Ohio, because a legal in
strument, supposedly de
signed to transfer the industrial
struggle from the realm of violence
and direct action to the realm of law
ooes noc cio so.
It does exactly
the opposite.
As it is being
Interpreted by la
bor and by the
Labor Relations
Board, it legiti
matizes terror
ism. The way
the Wagner La
bor Relations act
is being applied
has nothing to
do with the es
tablishment of
industrial d e -
mocracy. Indus
Dorothy Thompson.
trial democracy, like any other form
of democracy, depends upon action
freely taken, not action taken under
coercion. It provides for the protec
tion of minorities. It sets standards
by which the majority are permitted
to rule and the minority are per
mitted to exist.
It establishes a legal technique for
ascertaining that majority. If there
is no fair and disinterested applica
tion of rules, then the rules are
established and maintained by force.
The establishing and maintaining of
rule by force is a definition of war.
And at present we are engaged in a
civil war, and unless the struggle is
returned to the arena of law, that
civil war will extend itself into a
class struggle which may destroy the
American democracy.
The administration has apparently
adopted the policy that the Wagner
labor relations act is sacrosanct.
Because it is highly ambiguous and
capable of being interpreted one way
by Mr. Girdler and another way by
Mr. Lewis, extremists have developed
at both ends whose object is to
apply whatever interpretation of the
law suits their particular interests.
Elections Languish.
The law suggests that a majority for
collective bargaining should be deter
mined by a free election under neutral
auspices. But it does not insist on
such elections, nor explain how
and when they should be held. There
fore neither side will invoke the act
unless it is sure of a majority. And.
even then, if it is invoked, and an
election held, there is no confidence
that the auspices will be neutral.
The Labor Relations Board lays
down in its first annual report its own
interpretation of the act—that it is
exclusively an act to protect the
workers in their right to organize, and
that it is not applicable as protection
for employers. In practice this means
that carte blanche is given the C. I. O.
to coerce the workers into joining their
union. Maybe they ought to join the
union: maybe it is to their benefit to
join it. But there is nothing in democ
racy that says that people ought to
be coerced into doing even what Is
good for them.
Technique of Trotzky.
Leon Trotzky, who is the greatest
living strategist of revolutionary war
fare, thought this technique out and
put it into operation during the Rus
sian Revolution. He had a mast in
teresting conflict of ideas with Lenin
on the subject. Lenin felt that it was
extremely important to have the broad
masses of the workers with any revo
lutionary movement.
Having paralyzed the plant, the
C. I. O. then proceeds to terrorize
the public. In the hotel strike in
Detroit, for instance, the people who
suffered were not, in the first line,
the employers, but the customers.
Terrorization having exacerbated
the workers and the public and being
costly in the extreme, especially to
the workers, who at all costs want
to keep their jobs and earn their
livings, a plebiscite is finally held. It
is a terroristic plebiscite, and, from
the viewpoint of the democratic
method, not worth anything at all.
Public Interprets Acts.
Now—and this Is very Important
for organized labor—the public feels
that this is all sham, and has noth
ing to do with workers' rights or in
dustrial democracy. The public does
not see the ends: it does observe
the means. And the public—by the
public I mean Just the ordinary
citizen who has not yet been drawn
into the class struggle, and who has
a very great resistance against being
drawn into it—has a very sound
hunch that the means are exactly as
important as the ends. The public
thinks that in the long run the means
interpret the end.
In this situation the people of the
United States are not helpless. The
Congress of the United States is not
helpless. And it is inconceivable that
Congress welcomes the present state
of affairs. Vigilantes arc being
armed—one of the most dangerous
procedures which any democracy can
take—and their aim is not, and will
not be, to enforce the law. even if the
law were clear enough to be enforced,
but it will be to fight the strikers.
The organization of civil war by the
legal authorities is the breakdown of
law altogether.
Congress Must Act.
Therefore, the Congress must take
hold of the labor relations act and
make it mean something. It must
define what are fair practices for em
ployers and what are fair practices
for unions: what constitutes peaceful :
picketing and what docs not; what
procedures must be taken before a
strike is called, and when and how
elections shall be held.
Otherwise, let us have done with
all this fake stuff about democracy. '
Terroristic plebiscites are not democ
racy. They are the use of a demo
cratic instrument to establish an au
tocracy. We have not lived through
fifteen years of recent history with
out being able to recognize them for
what they are.
This Changing World
Spanish War Less Worrisome to France Than
Weakness of Soviet Army.
BY CONSTANTINE BROWN.
LEON BLUM'S cabinet celebrated two weeks ago its first birthday anni
versary. It’s a ripe age for a French cabinet in ordinary circum
stances. It's a still more remarkable event in these days of political,
social and financial troubles.
But the celebration has not brought the French leader much joy. He
Is confronted with new and serious problems.
In the international field the Spanish affair continues to be a
nightmare for every Frenchmen. When and how things may break
in the Mediterranean nobody Quite knows. The Mediterranean
nations—and France is one of them—live on a volcano which is
spitting fire and might erupt almost any day.
But what is worrying the French government and the military author
ities more than the Spanish situation is the unexpected weakness of the
Russian Army by the execution of
field marshals and generals. The
late Marshal Tukhatchevsky had
visited Paris last year and was
taken into the confidence of the
general staff to establish a co
ordination between the two armies
In the event of an international
conflagration. Nothing was kept
secret by the French general staff
from that high-ranking Russian
officer, who a year later was placed
before the firing squad as a traitor to his country.
* * * *
It is not the fact that the Russian generals have betrayed the military
secrets of their country—and by implication those of France—which worries
the Paris authorities. That could be easily remedied. Furthermore, mili
tary secrets are not as important these days as they were in the past.
The great concern in French political circles is over the unexpected dis
closure of the weakness of the Soviet Army.
The old Czarist army, hailed in the early days of 1914 as the
steam roller which would crush the Germans, proved to be an ordi
nary lawn roller incapable of crushing ordinary weeds. Things had
changed now, exclaimed the experts uho had seen the Soviet motor
ized forces, the parachute brigades and the handsome, strong young
red soldiers.
The purge has brought serious doubts in the minds of the French
leaders as to the ability of the Russians to hold their own once more against
any army—be it German or Japanese. And Leon Blum, who has always
questioned the wisdom of his predecessors to tie up with the Soviets
politically and militarily, is now wondering what he should do in the
event of a foreign attack against Soviet territory.
His Communist supporters will undoubtedly try to force his hand
to rush to the U. S. S. R.’s rescue. Blum is a man of principles and will
not let down his supporters. But neither is he likely to plunge his country
in a disastrous w-ar.
m w w w
The economic and financial situation in France is equally worrying.
France had to join the rearmament race the day Great Britain decided
to embark in a gigantic armament program. But while John Bull has
still plenty of cash and reserves, Marianne has mighty little left; the
dowry she had gotten years ago has been squandered by successive
governments
In order to meet the heavy expenditures for this fiscal year,
the French secretary of treasury must find a good deal of additional
revenue: $500.000,000 according to government sources; t2,000.000,
000 according to the figures of the opposition.
The German and the Italian purse string holders have not the
same headaches as their colleagues in democratic countries. Hitler and
Mussolini decree that this or that shall be done and it's being done. People
are tightening their belts whenever necessary; money, exports, imports
and production are strictly controlled by the government.
In the democratic nation where Parliament still has something to
say about expenditures, the repre
sentatives of the nation are gen
erally raising merry Cain when a
secretary of the treasury comes
with some sort of a bill which taxes
the principal sources of wealth of
the country. Thus Neville Cham
berlain had to withdraw gracefully
his project of putting a substantial
tax on the surplus industrial profits.
These are increasing by leaps and
bounds as the empire proceeds to
re-arm.
The same tning applies to i-Yance. it is cnmcuit lor tnp French
minister of finance to place heavy additional taxes on the Industry which
has to stand a good many burdens, because of the new social laws which
have been passed by the present Parliament.
* * * *
The French minister is looking right and left to find the additional
billions of francs necessary to meet this year's expenditure.
There is talk about another financial crisis in Prance. This may
or may not be so.
'Copyright, 1937.)
Headline Folk
and What
They Do
$5,000,000 Jenkins Es
tate Becomes Part of
Mexico Land Policy.
BY LEMUEL F. PARTON, '
EW YORK. June 16 —The $5,
000,000 Mexican estate of Wil
liam O. Jenkins, former United
States consular agent at Pu
ebla, will go into the hopper with
the great home-owned haciendas, as
the Mexican government presses
forward with its new agrarian policies.
The land will go to the peasants of
about 50 villages. They have com
plained Jenkins was paying wages
below the legal minimum.
Jenkins’ disagreements with suc
ceeding Mexican governments have
been of long standing. The Jenkins
kidnaping of 1919 worried our State
Department considerably, and certain
commercial adventurers thought it
might be fanned up into a nice little
war, but nothing came of it, barring
a few good newspaper stories. Jenkins,
a rich man. with lands and factories,
had a textile mil! n Duebla and
was the powerful business overlord
of the region.
On Saturday night. October 9, 1919,
when the mill was running a night
shift, Jenkins was strolling through
the mill compound, smoking his pipe,
at peace with the world. Three polite
bandits, masked with red handker
chiefs, rode into the yard.
Jenkins Goes With Bandits.
Jenkins, muscular and powerful, a
former Vanderbilt University foot ball
player, was a good rough-and-tumble
fighter, but the bandits had guns, so
he mounted the horse they ha/"
thoughtfully provided and went along'
—hiding in caves, galloping at night,
fetching up in a remote mountain
i wilderness, where his hosts, with the
j utmost tact, suggested that a trifle of
SI 50.000 would amply repay them
for their trouble.
The real trouble started when the
Puebla government put Jenkins in jail,
charging he had framed the kidnap
ing to make an issue and bring about
the overthrow of the Carranza gov
] ernment by American intervention.
| That made quite a stir, this side of the
! Rio Grande, and the case was a prom
i ising apple of discord for those who
wanted to see trouble develop.
“War of Jenkins' Ear.”
A reference to the ' War of Jenkins*
Ear" might fit in here, apropos of the
provocative name of Jenkins in inter
national history. Nearly 200 years ago
| one Robert Jenkins, a mariner, arrived
at the British court with his ear in
his pocket. He said the Spaniards
had boarded his ship, cut off his ear
j and ordered him to hand it to his King
j —which he did. The war started in
| 1739. Bells were pealing and crowds
j were cheering as the soldiers marched
! away. “They may ring the bells
now.” said Sir Robert Walpole, “but
before long they will be wringing their
I hands.” So it happened, as the British
! got a good trouncing at Cartagena,
i When it was all over, it was learned
I that Jenkins' ear had been cut off in
| the stocks, and that he had been hired
\ to use it to start a war.
(Copyright. 1P37.)