OCR Interpretation

New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, January 17, 1894, Image 1

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Persistent link: http://chroniclingamerica.loc.gov/lccn/sn89081128/1894-01-17/ed-1/seq-1/

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Ex-Congressman Lind Discusses the Pro
posed Oorporation Tax.
The Deceptiveness of the Measure Clearly
Pointed Out.
ITot a Tax on Incomes so much as on Pro
A Letter to the Keview which is Full of
Good Points.
Ex-Congressman John Lind of this city
has written the following letter for the
Review and we commend it to the care
ful and thoughtful perusal of all our
Editor Review: In response to your
request for an expression of my views on
the "income tax" which it is proposed to
levy to make up for the loss of revenue
resulting to the government from the
enactment of the pending tariff bill, I
shall only discuss the proposition sugges
ted by the president in his message to
Congress. That proposition is notto tax
individual incomes, but to tax the in
comes of 'corporations. As it is only
this latter scheme that lias received Mr.
Cleveland's sanction it is safe to assume
that an "income tax" properly speaking
will not be passed by the present Con
gress unless Mr. Cleveland should change
his mind, and that he is not likely to do
on this subject. To call this proposed
tax an "income tax" is a perversion of
language, as a moment's reflection will
snow. An income tax is a tax levied on
•that portion ot the citizen's income in
excess of a given sum say in excess of
$1000. If a person's income does not
exceed the minimum, he is not subject
to the tax. If it does he is to the extent
of the excess. Theoretically, at least,
this is an eminently fair tax as it is ap
portioned, approximately of course, to
the citizen's ability to pay. But the pro
posed corporation tax does not operate
that way. It will fall alike on all cor
porations. In those cases where the tax
will have to be borne by the shareholders
of the corporations (which will probably
not he many, as I will show later on) the
tax will fall upou the holder of ten
shares, the same as it will upon the hol
der of a thousand. It is this feature that
differentiates it from the system of in
come taxation as it exists in England and
as it existed here during and after the
Sva r.
For these reasons it is more proper to
eallMr.Cleveland's proposed tax, a speci
al tax and I shall so term it.
To assume to predict with certainty at
this time either as to the success of this
pronosed tax as a revenue measure, or as
to its effect on industry would be futile.
as nothing is more uncertain than there
suit of a new tax. All that one can hope
to do is to point out its tendency and
probable effects. "We do not even know
iii what form it will be presented. Ithns
'IX.'CM stated in the papers that it Avould
be limited to a tax on the net income of
coipor.ttions. If it should pass in that
form it strikes the writer that it would
not he very productive of revenue at
f. least when the country was enjoying
^democratic times." But thewciincome
,of a corporation is always an uncertain
quantity, as we learned to our sorrow in
connection with the Pacific railroads.
Tiie supreme court found it difficult to
dciine it, and it is not putting it too
strong to say that in the case of a rail
road or industrial corporation the netin
come always has been and always will
be largely a matter of book-keeping.
Hence if the proposed tax is to have any
value to the government as a revenue
measure it will have to lie levied on gross
That this tax should at first thought
appeal to the mind of the average citi
as a just and effective scheme to make
[capital contribute its quota to the sup
ot government seems quite likely,
^either is it improbable that it will be
fiddled and heralded by Mr. Cleveland's
jnifiny admirers as another of his dispen
sations for the relief of the masses for
.Lvljfcm he professes such great concern.
Seven venture to predict that it will en
oy a period of brief popularity until the
|'pe||l(i have had time to study it and
.oO» back of the label.
all know that there is at present
strong feeling of prejudice among the
le against corporations. In part, at
not without cause. Many of the
ations on which we depend for the
aries and conveniences of daily
ave by a short-sighted policy of ar
conduct and unreasonable exac
brought about a public sentiment
that cries aloud not only for retribution
but for punishment. Any scheme, that
on its face promises either, is therefore
likely to be hailed with joy. Again with
many the word "corporation" is synoni
mous with "capital" and "wealth" and the
conclusion is jumped at, that a tax on a
corporation is a tax on the rich, when as
a matter of fact in most cases it is really
a tax on production.
A little closer study of the question
will soon convince one that this proposed
tax is one in which appearances are espe
cially deceptive. A tax is never permit
rnitted to rest in "inoccuous dessuetude."
It is an unwelcome visitor. No one will
pay a tax out of his own pocket so locg
as by any means or contrivance he can
shift it on someone else. It is a good
deal like the "tag" among boys, which is
shifted from boy to boy until it gets to
the poor little fellow with the club foot
who can't get away from it. A tax as a
rule falls eventually on the fellow least
able to, pay it and this I believe to be,
in part at least, an explanation of our in
born aversion to taxes. The suggestion
that the taxes are paid by those least
able to bear them may seem paradoxical
but on the whole I believe it to be true.
We often hear it said, in the legisla
ture for instance, that the interests of the
farmers need special consideration, for
"they pay the taxes and we as
often hear that statement laughed at and
scouted, but inquiry and examination
will show that theie is more truth in it
than taffy.
Take for instance the tax on a retail
merchant's stock. Does any one doubt
but that it is made up in the price of the
goods just the same as freight charges
and other expenses? If it is, then the
tax in that instance falls on the consu
mers and not on the merchants. Of
course, I concede that there may be con
ditions of competition in trade where the
merchant may not be able to get back
either taxes or freight, but they are the
exception. The merchant as a rule shifts
the burden of the tax on the consumer.
To illustrate this more fully. Let us
suppose that the manufacturer of the
prints and hosiery sold by the retailer,
located in Mass., pays a tax on his fact
ory or on his business. Which do you
suppose he does, charge it up to his per
sonal account, or to his business? I im
agine to the business, aDd unless the
competition is exceedingly keen it will
surely be added to the price ofhisgoodsi
just the same as the other items of ex
pense of production. He, in the first in
stance, shifts the tax on the wholesaler
The wholesaler, Jwith local taxes added,
shifts the burden on the retailer and the
latter dumps the load on the consumer.
But take another class of taxes, more sim
ilar to the proposed tax the gross
earnings tax on the railroads in this
State. Kearly all the expense of our
State government is defrayed from this
source. It aggiegates nearly one million
dollars per annum. Pur city papers are
continually lauding this scheme as the
noblest monument to legislative wisdom
that our statutes have to show. Well
they may—by means of it the cities es
cape to a great extent the burden of State
taxes. In lieu of other taxes on railroad
property, we collect a tax of three per
cent, on the gross earnings of the rail
roads which is covered into the state
treasury. How is the money derived for
paying this tax? Does it come from the
stock holders' pockets, or from the earn
ings of the road? The answer is self-evi
dent. The money is paid from the re
ceipts of the road, just the same as ex
penses, for maintenance and operation.
If the railroads were relieved from this
burden, does any one doubt but that they
could afford to give the public cheaper
transportation? They certainly could.
If our State alone should release this tax
it might have but little effect as most of
our roads run into and an? taxed in ad
joining states. I am not arguing for the
repeal of railroad taxes so long as ad
joining states impose them. Such a
course would be folly. But the fact that
I desire to emphasize is, that a tax on
railroads is necessarily a tax or burden
on transportation. It it is a burden on
transportation it is reflected in higher
rates and it follows, that in the end, it is
not the railroad (stockholders) but the
public that pays the tax. Of course, as
suggested above, there may be roads that
are so situated and so pressed by compe
tition that the tax cannot be wholly ad
ded to the rates, but those cases are ex
The reports of the Inter-State Com
rnerceCom mission show that about three-
that portion of the freight traffic which
is made up from merchandise, fuel and
building material it is safe to say that
the higher freight rates resulting from
railway taxation are born by the consu
mers of these commodities and are equita
bly distributed, as taxes go. It will be
seen however that they are a burderj im
posed on the necessaries of the people
without reference to ability to pay. But
in regard to that large factor of railway
transportation, farm products, which
probably contribute more than one half
of all railway earnings in this State, the
entire burden of taxation falls on the far
mer, for it is self-evident that so long as
our farmers have to seek a market abroad
for their products, or for part of them,
they have to stand the whole cost of
transportation to market. When a tax
falls on the farmer it is there to stay.
Like the crippled boy who has got the
he keeps it. He cannot get rid of
it. The farmer cannot add the tax to
the price of his products.
Now, Mr. Editor, while in the limited
space of this letter I can only cite a few
illustrations, I think that I have shown
that in the cases cited the burden of ad
ditional taxes of the kind discussed
would fall not on the capital engaged in
production or transportation but that as
a rule it would fall on the commodities
produced or carried.
Ranting about corporations is to no
purpose. The corporation has come to
stay, as much so, as steam and electrici
ty. There may be and undoubtedly|are
serious defects in our system of manag
ing corporations. They should be reme
died. To try to repress them is futile.
They are based on the corporative in
stincts of an advancing civilization.
Nearly all of the great enterprises of to
day are carried on by them. I believe it
safe to say that 90 per cent of all manu
facturing is carried on by corporations.
Merchandising is largely carried on in the
same way, and transportation wholly so.
Any attempt to tax them can only re
sult, as I have shown, in increasing the
cost of commodities to consumers & bur
dening production. This is well under
stood by the monied interests of New
York city. They have formulated and
are content with Mr. Cleveland's propo
sition to "tax the income of corpora
tions," but it will be remembered that
when congress convened after the recess,
the NewYorkCity delegation fillibustered
nearly a week until they received assur
ances from the committee on Ways and
Means that no bill would be reported to
tax the incomes of individuals.
Mr. Cleveland may not succeed in re
storing the virgin queen of the Sandwich
Islands to her throne, but if he succeeds
in convincing the American people that
it is the part of patriotism and wisdom
to remove those taxes that are, at least
in part, born by the foreigners and to
impose them on the domestic producer^
and consumers he is entitled to our ad
miration though our confidence be.with
held. John Lind.
The school board met last Friday even
ingand considered applications for the
three vacant positions in our public
schools—vacancies brought on by a pol
icy as retrogressive and harmful as it is
beneath intelligent men. Most of "the
applications were for the best position,of
course, and after reading them all a bal
lot was taken and E. T. Critchett was
chosen to succeed Prof. Nix. Mr. Critch
ett was formerly principal of one of the
schools in Mankato and later of one in
Duluth. At present he is stationed in
Chicago and is not engaged in active
educational work. The other places
were not filled at present, it being deem
ed advisable to consult the new superin
tendent before making any selection.Mr.
Critchett is to enter upon his work on
the 22nd of January and his salary per
vear will be $1,250.
Pooular Everywhere.
Beginning with a small local sale in a
retail drug store, the business of Hood's
Sarsaparilla has steadily increased until
there is scarcely a village or ham let in
the United States where it is unknown.
To-day Hood's Sarsaparilla stands at
the head in the medicine world, admired
in prosperity and envied in merit by
thousands of would-be competitors. It
has a larger sale than any other medicine
before the American public, and probab
ly greater than all other sarsaparillas
and blood purifiers combined.
Such success proves merit.
fourths of the railway earnings in this for to try? Hood's Sarsaparilal
state are derived from freight traffic. On
If you are sick, is it not the medicine
Complete Refutation of the Charge that
Milne was Treated Unfairly.
Good Evidence to Show that his Competen
cy is not Deep-Seated-
No "Trickery" Resorted toby Nix and Eck
stein as has been Shamefully Asserted.
Some Unpublished Facts Regarding Mil
ne's Examination.
Notwithstanding he was Given Eyery Op
portunity and Advantage.
His Failure in Many Important Branches
was Remarkable.
The Board of Examiners have been
accused of trickery, bull-dozing and dis
honesty. They have concluded to speak
for themselves. Read their report on
the manner in which Milne was treated
when he came here and see if you think
the charges are true.
Editor Review:— You will confer a
favor by publishing in the next issue of
the Review the following history and re
port of examinations held in September,
1893, by the undersigned, who at that
time constituted the Board of Examiner
of this district.
G. Fischer, instructor in the high
school and grammar departments, havs
ing resigned, Dr. Strickler and A. F^
Reirn were appointed a committee to se
cure applications for the position. Under
former Boards of Education, candidates
had been required to submit original tes
timonials, certificates of standing, etc.
to file a biographical sketch to give re
ferences, etc. These papers were turned
over to the Board of Examiners, to as
certain whether the candidates in ques
tion appeared to be qualified to hold the
limited certificate of this district. After
the original papers and the Examiners'
report had been fully discussed by the
Board of Education (sometimes several
sessions were held, to obtain additional
information) the selection was made.
For most positions preference was given'
to graduates ot ourState normal schools.
The examination of the newly elected
teacher seldom required more than two
or three hours. His complete and auth
entic record was before us Ave knew
what work he had done, and how he had
done it we were generally familiar with
the standing of the institution from which
he had graduated. In such cases the ex
amination was oral questions were ask
ed to ascertain whether the given stand
ings required correction it was seldom
found necessary to change the ratings
brought from our State normal schools.
Five members of the new Board of
Education, desirous ol "improving" our
schools, were evidently determined to
substitute something better for this old
fashioned method of selecting teachers.
There were certainly some strong men
among the 42 applicants. The one who
had the smallest number of recommen
dations, was chosen. L. S. Koch had a
single recommendation, a letter from a
Mr. Hazard, of a Minneapolis teachers'
bureau. Mr. Hazard could well afford
to write that letter for a commission of
$45 (5 per cent, of first year's salary).
L. S. Koch claimed to be a graduate
of some '-college" at Nanerville, 111.,
where he had taken the degree of B. A.
The Board of Examiners gave him three
weeks' time to file his diploma, certifi
cates of standing, teacher's certificates,
original recommendations, etc., intend
ing to give him the usual oral examina
tion if his papers should be found satis
factory. The Board of Education was
notified in writing that the examination
would be held Sept. 1. L. S. Koch was
in the city Sept. 1, but Stiickler kept
him away from theExaminers by inform
ing him that he would be examined Sept
2. The Board of Examiners met again
Saturday Sept. 2. L. S. Koch appeared
before us without diploma, without cer
tificates and testimonials—in short, with
out any papers whatever. He had an
old catalogue of some institution, in
which he had entered his standings op
posite the branches studied by him. He
asked us to accept these percentages in
lieu of an examination. This we refused
to doS&iBy Strickler's artifice the time
left for examination, before the opening
of schools (Monday, Sept. 4) had been
reduced to a single dayiy^We decided to
examine orally, beginning with the
branches Mr. Koch was to teach. We
were very lenient with him, suggesting
topics rather than asking questions
Marking him most liberally, the follow
ing results had been obtained by- noon:
Civil gov't, 70 U. S. history, 60 gener
al history, 50 physics, 55. We wanted
him to take at least one written examin
ation, to •»•:', be able to mark
him in spelling and composition. As he
considered himself strong in arithmetic,
that branch was chosen. The questions
were, written in his presence (this is a
rule of our Board to which we adhere
whenever possible) they were principal
ly problems selected from the text-book
used in our grammar department. In
an examination of pupils, the time would
have been limited probably to 2 or 2£
hours L. S. Koch was promised all the
time he wanted. We did not expect
of course, that it would take him 7 hrs.
45 min. (1:30^-6:15 p. m. and 7:30—
10:30 p. m.) to fail in arithmetic (45 per
cent.) Although Clerk Reim of the
Board of Education had been constantly
present and admitted that the oral and
written examinations had been conduct
ed fairly, and that a B. A. should not
repeatedly write multiplicant, deminish,
devide, devision, etc., a rumor was spread
before evening that we were inflicting up
on Mr. Koch an examination in arith
metic of a severity heretofore unheard of.
Our oral examinations are generally con
ducted in the presence of at least two.
Examiners. Our schools opened Monday
Sept. 4 nearly 500 pupils had to be pro
moted by Supt. Nix. Examiner Hagberg
could not attend further oral examina
tions were, therefore,'out of the question,
Mr. Koch's classes had to be dismissed
while he was taking further written ex
aminations in Mr. Eckstein's office. He
failed in algebra (7 per cent.) In chem
istry, one of the branches to be taught
by him, he was given a set of the H. S.
B. questions. After If hours' writing
he delivered a single page, which was
graded 0. At 1:30 p. m. Sept. 4, Dr.
Strickler, through ClerK Reim, request
ed the Examiners to discontinue the ex
amination we replied that we would
not deny the applicant an examination
in any branch in which he desired to be
examined. After thanking us for the
courtesy shown him, Mr. Koch left the
city on the night of Sept. 4. Strickler's
organ, the News, then stated that we had
refused to certificate L. S. Koch this
falsehood was repeated, over Strickler's
signature, in a letter to Pres't Northrop.
Without calling a meeting of the
Board of Education, Dr. Strickler wired
to W. A. Milne, a fellow Canadian, to
come to this city, bringing all his certi
ficates with him. W. A. Milne arrived
Wednesday, Sept. 0.
W. A. Milne was one of the 42 who
had applied in August. The application
he sent was as follows:
St. Paul, Minn., Aug. 11, 1393
0 C. Strickler, Pres. School Board, New
Ulm, Minn.
Dear Sir:—Learning that there is a
vacancy in your high school in the de
partments ol* science, geography and his
tory, I respectfully make application i'or
the position.
I am a graduate of the Clinton Colleg
iate Institute and the Ottawa Normal
School, taking the full course in each. I
am also an under-graduate of Toronto
University. I hold a First Class Pro
fessional Certificate,-and have .been grant
ed a State Certificate for Minnesota with
out examination.
I have had seven years' experience in
teaching. I was for three years Principal
of the Norwich Public Schools, and for
two years Principal in Calgary, Alberta,
where I had eight assistants. I have
been engaged in teaching commercial
work in St. Paul for the last year.
At my filial examinations my average
in natural science was 99 per cent, in
geography 100 per cent, and in history
100 per cent. I have had charge of ad
vanced classes in these subjects for five
As an evidence of my success in the
school-room I submit for your consider
ation the enclosed copies of testimonials
I shall be pleased to furnish others if re-'
I aiu twenty-seven years old and am
married. My mother is a German, and
I have a very fair knowledge of the
I cannot make a personal application
to-day as I prefer doing.
If, however, it might be of any advan
tage to me, I shall be glad to go to New
Ulm at any time after to-day, If you
are favorably impressed with my applica
tion, but Wish to meet me before decid
ing,.please wire me at my expense and I
shall go at once. Wm. A Milne.
iTh "copies of testimonials" attached
to his application were of an exception
ally high character,-j-such as we had not
seen for years. With these "copies'", the
statements made in his application, and
an address the most courteous and insin
uating, Mr. Milne made a very favorable
impression upon the three Examiners.
The only original papers that were laid
before us, however, were a Canadian Sec
ond Class Professional Certificate, a pro
mise by Pres't Northrop to certificate
him without examiration in case of his
election to the principalship of a State
high school, a few lines signed by Ass't.
State Supt. Hyde, and a nnmber of let
ters from school authorities, informing
him that others had been elected to po
sitions for which Mr. Milne had applied.
As it was highly improbable that an ap
plicant would submit such letters inten
tionally, Mr. Milne's explanation, that
he must have interchanged them and the
originals be intended to bring, was satis
factoiy at the time. He said he would
write immediately to Mrs. Milne to send
the other papers. He was informed that
by producing certificates of standing in
required branches, the time of examina
tion would be materially shortened.
Wednesday Sept. 6, about 4:30 p. m., he
asked for and was given a text book on
chemistry. He was also given permis
sion to take books from the school lib
The examination began Thursday Seft.
7, at 9:10 a. m. at Examiner Eckstein's
office. Mr. Milne was granted unlimit
ed time. He requested the evenings for
preparation, which was accorded to him.
Every other wish expressed by Mr. Milne
was cheerfully met, so far as possible.
Written and oral examinations were
held as follows:
Thursday, Sept, 7.
Physics Written
Penmanship Written
Chemistry Written
Vocal Music Written
xllgebra, written, forenoon, (time not re
corded Phys. Geog.. oral, 45 m., Ex.
Eckstein and Nix Geometry, oral. Ex.
Eckstein and Nix General History, oral
Ex. Eckstein and Nix Taught a prim
ary class (one of our tests for profession
al ability) Ex. Eckstein and Nix.
During the written examinations Mr.
Milne was generally left alone in the
consultation room adjoining to Mr. Eck
stein's office. With our present know
ledge of the man,a different course would
be taken. (Cf. Shoup'sllistory andScience
of Education, lower half of page 142.)
In physics, the questions given were
of about the same grade as those sent
out by the II. S. B. in 1889. The total
attainable maximum on the questions
Mr. Milne attempted to answer was 56
per cent: the mark given, 35. The fol
lowing efforts were marked 0 each:
1. a. State the law of universal gra
vitation. ''All bodies have a tendency
to approach each other, and the force of
such attraction is in proportion to the
distance which separates the bodies."
3, a. A. cubic foot of water weighs
02.5 pounds. What is the weight of a
boat which displaces 625 cubic feet of
"The weight of the boat in air will be
the weight of the displaced water, i. e.
625 02.5=3900.25 lbs. Ans-"
4, b. State The laws ,of falling bodies
•'Falling bodies increase in velocity in
proportion to the square of the distance
through which they fall."
6, c. What is specific heat? "Specific
heat is a certain amount of "heat" re
tained by all bodies to preserve their
form. Thus if water be roobed of its
specific heat its form .is changed."
Attainable maxima on the above:
1, a, 5 per cent 3, a, 2 pro cent 4, b,
5 per cent 6, c, 3 per cent.
Excluding the above, the attainable
maximum on the remainder of the work
attempted (56 per cent.—15£ per cent.)
was 40£ per cent. He was allowed 35
per cent. -, _,,-
Much noise has been made about the
zero we gave on 3, a.We admit that there
is room for a difference of opinion on
this point. But considering that a cor
rect answer would have brought only 2£
per cent., and that the remainder of (he
worK was marked very liberally, the mat
ter is hardly worth mentioning. A rigid
..(Continued on fourth page.)
1 h. 35 m.
15 m.
30 m.
15 m.
1 h.
Total time 4 h. 35 m.
Friday, Sept, 8.
Eng. Grammar Written 1 h. 45 m.
Arithmetic Written 2 h. 30 m.
Physiology&Hygiene, Written 2 h. 30 m.
Total time, 6 h. 45m,
Civil Government, oral, Examiners Eck
stein and Hagberg. U. S. History, oral,
Examiners Eckstein and Hagberg. Geo
graphy, oral, Examiners Eckstein and
Hagberg. Time not recorded.
Saturday, Sept. 9.

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