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EIGHTEEN MASON CITY GLOBE-GAZETTE, MARCH 3 1936 TEXT OF TAX MESSAGE President Roosevelt Asks 'Congress to Provide Tax Legislation Making Sweeping Changes in Present Statutes. WASHINGTON, Iff) -- Preside! Â·Roosevelt's message to congre asking tax legislation: - To the congress of the Unite States: On January third, 1936, in m annual budget message to the con gress, I pointed out that withou the item for relief the budget was in balance. Since that time an im portant item of Â· revenue has bee eliminated through a decision o the supreme court, and an add: tional annual charge has bee placed on the treasury through th enactment ot the adjusted compen Â·sation payment act. I said in my budget message: "x x x the many legislative act . creating, the machinery for recover were all predicted on two inter department beliefs. First, th measures would immediately caus Â·a great increase in the annual ex penditures of the government--- man3' of these expenditures, how ever, in the form of loans which would ultimately return to the treasury. Second, as a result of th simultaneous attack on the man; fronts I have indicated, the receipt^ of the government would rise def initely and sharply during the fol lowing few years, while great in creased expediture for the purposes stated, coupled with rising values and the stopping of losses would over a period of years, diminish the need for work relief and there by would ultimately! meet aqd pass the declining cost of relief. 'This policy adopted in the spring of 1933 has been confirmed in ac tual practice by the treasury fig ures "of 1934, of 1935, and by the estimates for the 'fiscal years of 1936 and 193T. "There is today no doubt of thj ' fundamental soundness of the policj of 1933. If -we proceed along the path we have followed and with, the results attained up to the pres ent time we shall continue our successful progress during the coming years." TREASURY REVENUE LOSS MUST BE MADE GOOD If we are to maintain this clear- cut and sound policy, it is incumbent upon us to make good to the federal treasury both the loss of revenue caused by the supreme court decision and the increase in expenses caused by the adjusted compensation payment act. I emphasize that adherence to consistent Â·policy calls for such action. To be specific: The supreme court decision adversely affected the budget in an amount of one billion and seventeen million dollars during the fiscal year 1936 and the fiscal year 1937. This figure is arrived at as follows : Deficit to date (expenditures chargeable to processing taxes less -processing taxes collected) in excess of that contemplated in the 1937 budget $281,000,000. Estimated expenditures to be made from supplemental appropriation approved in the supplemental appropriation act, 1936, $296,000,000. Estimated expenditures to be made under the soil conservation and domestic allotment act, $440,000,000. Total additional deficit 1936 and 1937, due to supreme court decision and' adjusted farm program, $1 017,000,000. For the purposes of clarity, I divide the present total additional rev- e'nue needs of the government into the permanent and the temporary ones. 500 MILLION DOLLARS NEEDED PERMANENTLY Permanent treasury income of five-hundred million dollars is required to offset expenditures which will be made annually as a result of the soil conservation and domestic allotment act recently enacted by the congress and approved by me; and an additional sum recurring annually for nine years will be required to amortize the total cost of the adjusted compensation payment act. The net effect of paying the veterans' bonus in 1936, instead of 1945, is to add an annual charge of one hundred and twenty million dollars a year to the one hundred and sixty million dollars already in the budget. We are called upon, therefore, to raise by some form of permanent taxation an annual amount of six hundred and twenty million dollars. It may be said, truthfully and correctly, that five hundred million dollars of this amount represents substitute taxes in place of the old processing taxes, and that only one hundred and twenty million dollars represents new taxes not hitherto levied. LEAVES TAX BILL TO CONRESS' DISCRETION. I leave, of course, to the discretion 'of the congress the formulation of the appropriate taxes for the needed permanent revenue. I invite your attention, however, to a form of tax which would accomplish an important tax reform, remove two major inequalities in our tax system, and, stop "leaks" in present surtaxes. Extending study of methods of improving present taxes on income from business warrants the consideration of charges to provide a fairer distribution of the tax load among all the beneficial owners of business profits whether derived from unincorporated enterprises on from incorporated businesses and Â·whether distributed to the real owners as earned or withheld from thera. The existing- difference between corporate taxes and those imposed on owners of unincorporated businesses renders incorporation of small businesses difficut or impossible. The accumulation of surplus in corporations controlled by taxpayers with large incomes is encouraged by the present freedom of undistributed corporate income from surtaxes. Since stockholders are the beneficial owners of both distributed and undistributed corporate in- j come, the aim, as a matter of fundamental equity, should be to seek aquality of tax burden on all corporate income whether distributed or withhed from the beneficial owners. As the law now stands our corporate taxes dip too deeply into the shares of corporate earnings going to stockholders who need the disbursement of dividends; while the shares of stockholders who can afford to leave earnings undistributed escapes current surtaxes altogether. METHOD OF EVASION HELD OLD PROBLEM This method of evading existing surtaxes constitutes a problem as old as the income tax law itself. Repeated attempts by the, congress to prevent this form of evasion have not been successful. The evil has been a growing one. It has now reached disturbing proportions from the standpoint of the inequality it represents and of its Serious effect on the federal revenue. Thus the treasury estimates that, during the calendar year 1936, over four and one-half billion dollars of corporate ncome will be withheld from stockholders. If this undistributed income were distributed, it would be added o the income of stockholders and there taxed as is other personal income. But, as matter!; now stand, it will be withheld from stockholders by those in control of these corporations. In one year alone, the government will be deprived of revenues amounting to over one billion :hree hundred million dollars. A proper tax on corporate income (including dividends from other corporations), which is not distributed is earned, would correct the serious :wo-fold inequality in our taxes on business profits if accompanied by a repeal of the present corporate income tax, the capital stock tax, the related excess profits tax and the Jresent exemption of dividends from .he normal tax on individual incomes. The rates on undistributed corporate income should be graduated and so fixed as to yield ap- roximately the same revenue as would be yielded if corporate porfits were distributed and taxed in the hands of stockholders. Such a revision of our corporate axes would effect great simplifica- ion in tax procedure, in corporate accounting, and in the understand- ng of the whole subject by the cit- zens of the nation. It would consti- ute distinct progress in tax reform. The treasury department will be lad to submit its estimates to the ongress showing that this simplifi- a'tion and removal of inequalities an, without unfairness, be put into ractice HO as to yield the full mount of six hundred and twenty nillion dollars--the amount I have ndicated above as being necessary. TURNS TO TEMPORAJRY VEEDS OF GOVERNMENT Turning to the temporary revenue ieeds of the government, there is he item of five hundred and seven- een million dollars which affects rincipally the current fiscal year. "his amount must in some way be estored to the treasury, even hough the process of restoration .ight be spread over two years or hree years. In this case also the formulation f taxes lies wholly in the discretion f the congress. I venture, however, o call your attention to two sug- Â·estions. The first relates to the taxation f what may well b? termed a wind- all received by certain taxpayers vho shifted to others the burden of roeessing taxes which were im- ounded and returned to them or Â·hich otherwise have remained un- aid. In unequal position is that ast number of other taxpayers who id not resort to such court action nd have paid their taxes to the overnment. By far the greater part f the processing taxes was in the main either passed on to consumers r taken out of the price paid pro- icers. The congress .recognized this act last August and provided in ection 21 (D) of the agricultural djustment act that, in the event f the invalidation of the process- ug taxes, only those processors who ad borne the burden of these tax- s should be permitted to receive re- inds. The return of the impounded inds and failure to pay taxes'that ere passed on result in unjust en- Clear Lake Globe-Gazette OFFICE PHONE 239 HELEN HENDRICKS, News Editor LEE DEWIGGINS, Circulation and Advertising Residence Phone 310-W Residence Phone 67 COMMITTEES ARE NAMED AT CLUB Geraldine Stenby Is Wei corned Into Club as New Member. CLEAR LAKE -- Miss E u n i c ( Chism assumed her duties as presi dent of the Wa-Tan-Ye club Mon day night at the business session al the Soda Grill. Dinner was served at 6:30 o'clock. An invitation to the association convention at Mason City in May was read to the club. Miss Geraldine Stenby, music instructor in the Mason City schools, was welcomed into the club as a new member. The president appointed committees for the ensuing year. The program committee includes two for each month: March, Lucille Olson and Eunice Â·Chism; April, Genevieve Hansen and Mary Bowman; May Thelma McMullen and Mollie Wellmon; June, Nita Church and Hattie Burkhart; .July, Mollie McGowan and Linda Herriman; August, Mary Bowman and Dorothy Runcie; September, Lillian Overton and Oreta Minette; October, Margaret Sheridan and Dr. Jane Wright; November, Pearl Witke and Geraldine Stenby; D e c e m b e r , Emmabelle Thomas and Amy Steffin; January Mable Newcomer and Helen Hendricks; February, Edith Naylor and Eunice Chism; March, Abbie Eldridge and Arlovene Kugler. Other committees appointed were Attendance -- Emmabelle Thomas Helen Hendricks, Dorothy Runcie and Oreta Minette; Grievance-Mary Bass, Hattie Burkhart. Mollie Wellmon and Genevieve Hansen; song leaders--Nita Church and Mable Newcomer; pianists--Geraldine Stenby and Dorothy Runcie; flowers--Lillian ' Overton, Pearl Witke and Mary Bowman; inter-city--Abbie Eldridge, Mable Newcomer, Linda Herriaaan, Dr. Jane Wright; publicity, Helen Hendricks, for Globe- Gazette; Thelma McMullen for Wa- Tan-Yen; and Margaret Sheridan for Clear Lake papers. Clear Lake Calendar Wednesday--Music hour at tie high school. . Plymouth group 6 of Congregational church at Mrs. F. C. DeBruyn home, North Third street Wednesday--Methodist Ladies' Aid society at church, 2:30. Lions club at Legion clubrooms. Club dance at North Shore Country club. Carl West band playing. Lions club at Legion clubrooms. Zion Lutheran Ladies' Aid at church, 2:30. W. C. T. U. at Mrs. R. D. Robbins home, North Fourth street, 3:15. Bethlehem Lutheran Ladies' Aid society at church, 2. O. D. O. club at Mrs. Verne Petersen home. North Oak street. Thursday--Rotary club at I. O. O. F. hall, 12:15. Pythian Sisters at 6:30 at I. O. O. F. hall, dinner, cards and dancing. Royal club at Mrs. George Petersen home, assisted by Mrs. Dorance Day. Junior Federated club at Anita Chizek home. chment, contrary to the spirit of lat enactment. A tax on the bene- ciaries unfairly enriched by the eturn or non-payment of this fed- Â·al excise would take a major-part f this windfall income for the ben- 'it of the public. Much of this rev- nue would accrue to the treasury uring the fiscal years 1936 and 937. The other suggestion relates to a mporary tax to yield the portion ' five hundred and seventeen mil- on dollars not covered by the wind- .11 tax. Such a tax could be' spread 'er two years or three years. An :cise on the processing of certain 'ricultural products is worth con- dering-; By increasing the number " commodities so taxed, by greatly wering the rates of the old prd- sing- tax and by spreading the ax over two or three years, only relatively light burden would be mposed on the producers, consum- Â·s or processors. Franklin D. Roosevelt The White House, March 3, 1936. Alfred Smith, Former Mitchell Man, Buried MITCHELL--Mr. and Mrs. R. S. Shaffer Monday accompanied the body of Mrs. .Shaffer's father, Alfred Smith, here from Fulton, Mo., for burial, which was to have been Wednesday afternoon. On account of the heavy snow the train was stalled for two days south of here. They were unable to reach here before Friday. Mr. Smith was more than 80 years of age and was a resident and businessman in Mitchell more than 60 years ago. Mr. and Mrs. Shaffer left the same night for their home at Fulton. Jennie .Barker Funeral Held in Fredericksburg FREDERICKSBURG--F u n e r a 1 services for Miss Jennie Barker were held here at the Ralph Countryman home Friday afternoon with the Rev. Donald Artmann of the Method.ist church officiating. Miss Barker was bom near here Oct. 26, 1879. She is survived by her mother, Mrs. Kate Barker of Sumner arid two sisters, Mrs. Florence Ladwig of Sumner and Mrs. Alice Countryman of Fredericksburg. Former Resident Dies. ST. ANSGAR--Mrs. Mary White- an received word Monday that rs. George Roberts of Waterloo, n old friend of hers, died. Mrs. oberts was well known in this cinity, having lived here several ears ago.' Roads Are Opened. S T I L S ON --The county road orth of Stilson and the roads in tilson and east of Stilson were lened up Sunday. Men from this cality shoveled to help the snow- ow to get through. Wesley School and Town Elections .Are Scheduled WESLEY--The annual school directors election of the Independent district of Wesley, will be held next Monday, March 9th. Two directors and a treasurer will be named to fill the expired terms of H. J. Braley. H. M-Hanson and I. A. Gerdes.-J. L. Grattidge, H. M. Hanson and I A. Gerdes have filed petitions. Mr. Braley does not wish re-election, having served 22 years on the board. The annual town election will be held Monday, March 30. A mayor, five councilmen, a treasurer and an assessor will be elected. Floyd Nesbit Feted at Birthday Party CLEAR LAKE--Miss Doris Ellerson entertained a group at dinner Sunday night at the Soda-Grill. The affair feted Foyd Nesoit who cele- ebrated his birthday Friday. C. J. Fox entertained the group at the theater following the dinner. Covers were laid for 10 guests. COE'S CAGERS ARE UNBEATEN Faculty Men's Team Has Won All of Its Tilts. CLEAR LAKE -- Harvey Coe's team is leading the high school boys' intramural cage tourney without a loss and a total of 130 accumulated points. Phillippe's team has won three, lost rjne, while Fistler and Mullarky and their teams have two of each. The faculty team beaded by Coach Chris Johnston is undefeated in the three games it has played. Games scheduled for Tuesday night are: Faculty vs. Comstock, Coe vs. Phillippe and Lewis vs. Bacon. Coe Fistler Mullarky Philllpe Lewis Comstock Bacon Faculty STANDINGS Played W. 5 3 4 2 4 2 s a 3 1 3 2 4 0 3 3 Fts. ISO 59 49 .SB 34 32 24 100 Clear Lake Briefs Want: Cheap small house. Ph. "a. Billie Jean Fox", daughter of Mr. and Mrs. Grant Fox, is quite ill at her. home suffering from scarlet 'ever. Mrs. Fox is ill with the mumps. Rollins silk hosiery, 79c and $1. The Nichols Shop. Mr. and Mrs. A. I. Shook returned ;hi3 week-end from Florida where they spent the winter months. New Nelly Don cotton dresses, $1.95, $2.95 and ?3.95. The Nichols Shop. Miss Marnis Hatch, South Second street, has accepted a position in the office of the new Sears Roebuck company at Mason City. Nelly Don linen dresses, .118.95 lo $7.95. The Nichols Shop. Mr. and Mrs. Harry Fox who reside five miles north of Clear Lake )lan to move this week to a farm at Cohassett, Minn. Outstanding new silk dresses, S5.95 to $19.95. The Nichols Shop. Mr. and Mrs. George Dodd moved Saturday to the tenant house at the Â·lans Henriksen farm north of Clear Lake. Pure dye silk print dresses, $7.95. The Nichols Shop. Milford Daniels has returned from Leavenworth, Kans., where he vis- ted his sister. Mrs. J. M. Jacobson left Monday night for Omaha where she was called by the illness of her mother. Use our service and be square with your creditors. Cerro Gordo ~oan and Investment Co., Clear Lake. Lathan Zobel and family are mov- ng to the Vern Nelson farm north if Clear Lake this week. Sid Levy, manager of the Lake .heater, returned from a business .rip to Des Moines. Diamond Honey-Krushed Wheat Sread is now approved by Good Housekeeping- Bureau. Mr. and Mrs. Lafe Erickson and amily, Camp Grounds, moved into he Denny cottage for the season. Harold Charlesworth, student at Carleton college, Northfield, Minn., s confined to the college hospital at Northfield with the flu. Frank Trager, who is working at Oskaloosa, spent Sunday with is family, South Second street. Naida Lee, daughter of Mr. and Mrs. Forde Lee, Marion -Park rive, is quarantined with scarlet ever. D.U.V, PRESENTS CLUB PROGRAM Daughters of Union Veterans Learn of History of Home Tent. CLEAR LAKE--A program under the direction of Mrs. J. F. Char- iesworth, patriotic instructor of the Daughters of Union Veterans, was presented Monday night to the organization. A-pot luck supper was served at 6:30 o'clock at the Legion clubrooms to about 20 guests. The program was opened with community singing of "America." A brief history of Jessie Home tent No. 45, of the D. U. V., written by Mrs. A. R. Cain, was read by Verna Carpenter The organization was formed Aug. 27," 1927. The birthdays of William McKinley. Abraham Lincoln and George Washington were observed, and papers on these great men were written by Harold Charlesworth. student at Carleton college. Mrs. Willis Miller, Mrs. Kenneth Cobb and Mrs. Lona Brose read the articles which was followed by the reading of Theodore Roosevelt's tribute to McKinley and Lincoln by Mrs.- Charlesworth. Pictures of Washington's home at Mt. Vernon and of the Washington hotel in Washington, Pa., were shown. The flag salute concluded the meeting. Mrs. P. D. Leith, president of the tent, presided at the business session which followed. * * ^. "MY SPRING GARDEN" IS TOPIC FOR CLUB Mrs. F. A. Barber was hostess to Library Reading club members on Monday afternoon. Mrs. Nellie Baldwin read a paper on "My Spring Garden." The roll call feature was "Wild Flowers." Mrs. E. K. Greene also gave a paper on flowers. A letter from a member, Mrs. B. W. Riner in California was also read. * * * MRS. DeBRUYN HOSTESS TO PLYMOUTH CLUB Mrs. F. C. DeBruyn will be hostess to the Plymouth group 6 of the Congregational church Wednesday afternoon at her home. Mrs. A. J. Erickson will be the assisting hostess. Mrs. R. J. Aurdal is the president of this group. * * * FAREWELL PARTY IS HELD FOR HARRY FOX A company of about 25 neighbor! held a surprise farewell party for Mr. and Mrs. Harry Fox, north of Clear Lake, Sunday night. The Foxes will move to Cohassett, Minn. Dr. Mackin to Retire From Institution and Reside at Clear Lake CLEAR LAKE--Dr. M. C. Mackin, superintendent of the state institution at Mt. Pleasant, has resigned his post effective April 1. He and Mrs. Mackin will move to their home at Clear Lake, South Third street, . for their permanent residence at that time. They will be joined by their daughter, Helen Mackin, of Ames in June. Moving to Illinois. ORCHARD--Luther Kurtz and family are moving their household goods to Illinois where they will make their home. Short in Electrical Wiring Cause of Fire at E. F. Ziegler Home . Firemen were called to the home of E. F. Ziegler, 121 Crescent drive, about 2:44 o'clock Tuesday morning when the electrical wiring in the home shorted. The insulation was turned from the wires when firemen arrived and it was necessary to cut the leadin wire to the home. John Sinnett Held on Driving Charge The case against Jol-.a J. Siunett, Gilmore City, who was arrested on a charge of driving while, intoxicated, was continued until Wednesday afternoon by Police judge Morris Laird Tuesday. Sinnett was arrested at the Lapiner garage at 7:10 o'clock Monday evening following an accident at Second street and South Federal avenue when the car driven by Sin- r.ett collided with a car driven by Carl Stein, 1136 First street southwest. 70 on 19th Birthday. SWEA CITY--A surprise birthday party was given Mrs. S. J. Swanson Saturday, honoring her 76th birthday. This is the nineteenth birthday Mrs. Swanson has celebrated, as she was born on Feb. 29. Thirty guests enjoyed a social afternoon. Many gifts were received by the honor guest. STRENGTHEN THE BLADDER MAKE THIS 25c TEST. Drink lots of boiled or distilled water, if irritation causes . getting up nights, frequent desire, scanty flow, burning or backache. You know what hardwater does to a teakettle. Drive out excess acids ind deposits with buchu leaves, juniper oil, etc., made into green tablets called Bukets. the 'bladder lax. Works on the bladder similar to castor oil on the bowels. In four days, if not pleased, any druggist will refund your 25c. Michael Drug Co., Huxtable Drug Co. Regular $1.50 .00 $1 CINDERELLA STOCKINGS Don't neglect this bargain in hosiery, Buy the best you can, for hose are certainly in the limelight, now that skirts are shorter. These are beautiful, sheer and clear, but carefully re-inforced at the points where the most punishment is taken. At $1.00 they are exceptional values, so you had better take the opportunity to stock up. All Spring's best colors . . . and a complete size range. Â· COAL Â· FLINT Â· CHESTNUT 9 PEAT Â· PEWTER Â· RUSSETONE DflmOlTS CARD OF THANKS We want to thank our neighbors and friends for kindnesses and help nd sympathy extended during the ickness and death of our son, )uane. and during our present uarantine. MR. and MRS. GRANT FOX and ;ILLIE JEAN. Suffers Broken Hip. SWEA CITY--C. A. Moline, 86. pioneer resident, suffered a broken hip when he fell on the ice at the home of his son, Henry Moline, Saturday. -lighway 106 to Bayside Is Opened After Storms CLEAR LAKE -- Highway 106 round the south shore has been pened a.q far as Tanglefoot. The oad to Bayside and Dodges Point is also open. PARK THEATRE Tonight and Wednesday "KEEPER OF THE BEES" Hollywood News - Vitaphone Vaudeville and Popeye ADMISSION JOc and lie LAKE THEATRE Clear Lake, Iowa Tuesday--Jack Benny "IT'S IN THE AIR"" Wednesday and Thursday WILL ROGERS "IN OLD KENTUCKY"