Evening Star Newspaper, June 23, 1929, Page 31

."TAXPAYER IS HONEST IN DEALING WITH U. S. Commissioner of In |'# Dealings With BY WALTER H. ATKINS, J\HE rule of tax honesty is obeyed % American taxpayers. authority than . Blair, for the past years -Commissioner of Internal ue, vouches for that assertion. © And Mr. Blair knows the American conscience. ~ His appraisal of the tax-mindedness @t the people is that of a qualified ex- i gpert. For in eight busy years he had , ¥arned into the United States Treasury $23,000,000,000 internal revenue tax | money. : l:y‘hl.l bossed the job of auditing | $4,000,000 tax returns. The Treasury 1 ts with pride to the fact that 9912 cent of these have been finally losed on the Government’s books. There is much to interest us in the fonfld!nt assurance that the other fel- ow is also squafe in his tax dealings th the Government. As taxpayers and business men and women you are deeply interested, t0o, } in getting a better close-up view of the of collecting the stupendous sums needed to run the Government. Business Methods Prevail. Safeguards and procedure, as ade- quate in their scope as human in- | genuity can devise, have been set up 1o assure maximum compliance with Federal tax requirements. A rei achievement in injecting more modern like methods into this great 1 Government activity stands to the last- ing credit of Secreatry of the Treasury A. W. Mellon and to Mr, Blair, his hief adviser in Federal tax matters for | early a decade. It is fine to know, from such unim- feachable authority, that taxpayers as & class are on the level with the Gov- ernment. Those who are not on the {level have learned to their sorrow that jhonesty is the best policy in transac- dlons with the Government, as in all | ess matters. To be sure, there are tax evaders. |fBut such cases are rare exceptions to Rhe general rule of tax honesty. Be- cause it is the exception, the glaring of tax law disobedience gets the ig_headlines, ‘What Mr. Blair has seen from his @ntimate inside vantage point—and ‘what the public cannot see—is the mass of confidential tax records the Treasury files, with an almost inexhaustible store of knowledge as to the taxpayers’ income sources. Here mvldedh the index to the average taxpayer’s honesty. In literally hundreds of ways it is us possible to determine whether or yer, big or little, attempts Government, pse at the inside workings leral tax-collecting max | | of and paid what is justly due be relied upon to | years. Questions Which Arise. _ Assured that the.other fellow is pay- the Ifi'hlt owes, it interest probably is aroused also ! in_these among other questions: ! What are the Government's safe- against tax evasion? What has done to bring the taxpayer and ‘Government, closer together? To what | extent has red tape been slashed? How | efficlent is our present tax collecting ‘What of the effect of the | decentralized system of #ral tax money? Mr. Blair met these questions, and many more, with characteristic frank- ness_the other day as we talked at | the Treasury. ‘Te had just turned over the affairs of his office to his succes- | sor, Robert H. s of Kentucky; Ccleared up his and prepared for ! a vacation, one of the few he has had since taking over the revenue helm at the outset of President Harding's n. ) Ooun;:ment‘- ntmu:;p:;:‘lrd taxpayer is not one jon, it was made clear. A higher ideal of public service has grown up and a relationship of helpful co-operation ‘-;.nb bewteen the taxpayer and i Fear Not a Factor. “Federal taxes are not - collected through fear,” Mr. Blair said. “The tax laws are not administered in that “The righteous taxpayer can look the tax collector squarely in the.eye and « tell him ‘I'm glad to see you. “If the unrighteous taxpayer suffers grom the lashes of his own conscience he must realize that he has brought it upon himself by his own wrongdoing, and it is unfair to hold the Internal Revenue Bureau responsible for suffer- ing of this kind. “The revenue agent is the taxpayer’s driend, but he is a human being. If he is met in the right spirit, he will come fto the taxpayer and help him work out his problems. If the tax- payer has made mistakes against him- | self these will be pointed out to him. ‘The revenue.agent’s sole purpose is to s:lt. the correct answer to the indivi- I's tax problem. He should always be accepted in that spirit. “In complicated transactions repu- table lawyers and accountants can be most_helpful to the taxpayer and to the Internal Revenue Bureau. “But many taxpayers, to their sor- row, will testify that the 50-50 expert, awho promises to save his elients most of their taxes, and get favors for them that other taxpayers cannot get, has Jed them into enormous expense, into ‘untold grief, and, in many instances, into the very door of prison. “Such practitioners deserve extreme ishment. But the taxpayer who willingly follows, knowing in his ! ‘heart that he is wrong, cannot expect ‘o escape, and he has no right to cen- ‘sure the bureau for the suffering he has brought upon himself.” A fraudproof system of tax auditing | and for detection of tax delinquents| fun~tions with rare smoothness. It is | next to impossible to beat the Govern- ment out of taxes. The revenue intel- | ligence corps is the best ever recruited| the Government. The hunt for| evaders knows no siopping when tax ¥ dodging is suspected. Few Escape Detection. “There are literally thousands of chetks on a taxpayer's honesty. The fiovernment knows how to determine a-taxpayer's liability from its vast num- ber of confidential information records. For instance, 10,000,000 “information Teports” are sent to the bureau each ‘year on sources of income from sal- arjes, Interest and dividends, In. numerable other checks are at hand re taxpayer liability. So perfect- y adjusted is the system for compel- ling full payment of tax obligations that few delinquent escape detection. ‘The wilful evader falls into the seriminal classification. The intelli- ' unit, in running him to cover, I'co-ordimates its forces with those of revenue accountants, . auditors, en- gineers, examiners and technical ex- perts extending their activities into towns and cities throughout the entire country. ‘Today the, revenue boss has a man’s He has al | personnel functions in Washington. ternal Revenue Has Many Ways of Detecting Fraud in Government. revenue taxes, of which sum income taxes amount to $2.174,000.007 He heads a force of 12,000 people gather- ing Federal taxes on the basis of more than 5,000,000 tax returns. A noteworthy achievement, of great benefit both to taxpayer and Govern- ment, has been the perfection of a program of decentralization for the handling and auditing of income tax returns. In former years many func- tions in conection with the handling of returns were performed in Washing- ton. Broadly, decentralization means “sending the revenue man to the job.” ‘Through decentralization, however, the taxpayer today comes into direct contact, in his home district, with the internal revenue agent. The taxpayer thereby is enabled to clear up at home doubtful questions relating to his re- turn. ‘This method facilitates correct and prompt adjustment of tax obliga- tions, without delay and possible em- barrassment and saves the taxpayer the time and expense of at least one and possibly several trips to Washington. Under new procedure practically all re- turns, except the consolidated corpora- tion tax returns, are audited in the revenue field offices. A revenue field force, under the de- centralization program, is a fact-find. ing group, operating with reviewers and conferees, much in the same man- ner as the latter class of ttchnh'&n‘} recommendations submitted by revenue agents are. carefully reviewed. During the last year the conferees closed by agreement more than 50 per cent of the cases referred to them. Keeping Up With Work. New methods of procedure introduced by Commissioner Blair made it possi- ble to clear up an accumulation of 3,000,000 cases which piled up in the bureau files during the period of post- war readjustment. Besides, the Gov- ernment’s tax work has been brought practically to a current basis. This means that millions of tax returns filed annually will undergo audit and adjustment in the year in which they are filed. b Matters of Federal taxation are fun- damentally matters of administratidn rather than litigation, Mr. Blair con- tends. There has been a concerted drive to clear up all tax cases where the issues are susceptible of friendly and satisfactory adjustment and to ef- fect settlements wherever possible in the cases pending before the Board of Tax Appeals and the courts. Despite the rapid progress made there still re- mains pending 18,000 cases, involving $675,000,000 on the board's calendar. The Treasury Department is con- vinced that it is mutually advantageous to the Government and to taxpayers to take many of these appealed cases out of the realm of litigation and to settle the matters in dispute by ad- justment. By a procedure designed more to follow along the methods ordi- narily employed business, rather than the technicalities of a legal pro- ceeding, endeavor is made to determine the actual facts relevant to the dis- pute. Where a_conclusive determina- tion cannot be found, mutual conces- sions are made in favor of the strong- er presumption, or as the greater weight of proof may justify. Upon a finding of facts so determined the bureay and the taxpayer then agree, if ible, upon the proper, law, rulings Tegulation ble. This policy has and will continue to result in the payment to the Treasury of many milliohs of dollars ‘which otherwise might very possibly be held up several years awaiting adjbdication by the Board of Tax Appeals or by the courts. ‘Will Clean Up Cases. ‘The drive to wipe out congestion the Board of Tax Appeals, which, aft- er all, is merely a fact-finding body, will result in the settlement of prob- ably not less than 11,000 of the cases now pending. The prompt and fina! closing of cases, upon the basis of sound tax principles, and without liti- gation, where no serious legal question is involved. is the objective, Pursuant to this policy, the Government is meet- ing the taxpayer in a spirit of fairness and frankness. Taxpayers have learn- ed that this policy is best for them. After all, the Government wants from the taxpayer only what he owes the Government in taxes. The reason for so much litigation is partly due to the taxpayers’ failure to furnish -all the facts uj which the Government can make 1 decision. ‘The value of a more business-like method of settling tax dll{)um. inaugu- rated by Commissioner Blair two years ago, by the creation of the special ad- visory committee, to settle aj led cases as well as those in which ap- peals were imminent has been fully demonstrated. During that - period more than 8,000 cases were recommend- ed for settlement with additional tax assessments totaling $53,000,000. Thia committee consists of 14 members, and a number of conferees, both in Wash- ington and in the regional revenue fields. Their job is to settle cases where facts are predominantly in dis- pute by direct conference with the tax- payer. This method of forestalling pealed cases, or of adjustment of cases even after they have been appealed to the Board of Tax Appeals, has served as a life-saver for the board, which was in serious danger of breaking down beneath the heavy load of docketed cases. Interest in Recent Refund. Public interest in the Treasury's policy regarding tax refunds was aroused recently by a decision of the revenue commissioner to allow a refund of several million dollars to a large corporation. ‘There would have been no question or criticism if the Treasury had dealt in thousands instead of milijons of dol- lars with a small ‘corporation, and yet the principle was the same. The un- deniable fact remained that the cor- poration was clearly entitled to the re- fund as a matter of law and fairness. The fact was that the corporation, at the time of making its tax payment, had actually paid the Government more than it believed it owed, but feft for future adjustment the questiord Jf fact which were raised. Why does the Government make tax refunds? The answer is simple enough when | we know the facts. The Government needs money to run the Government, levies taxes and insists upon mmediate payment. Payment cannot be post- poned by any question as to the amount to id. T question must be set- However, after the Govern- ment finds the taxpayer has paid too much and rightfully claimed certain allowable deductions, then there is no other course Lo follow than to pay back the excess amount to the taxpayer. Here are some of the reasons that are responsible for tax refunds: Tax- payers' improper interpretation of the Federal tax laws, taxpayers’ ignorance of the law, mathematical errors by tax- payers, payment under Treasury regu- lations that have since been reversed by the Tax Appeal Board or the courts, legislation that has retroactively re- duced the taxpayers' liability or gt - visions of tax laws that have been held unconstitutional. nder a law which deals with such a wide range of circumstances, reaches millions of people and produces so much revenue, cases are bound to arise in which the taxpayer finds he has paid too_much or too little in taxes. ‘The ure followed by the In- ternal enue Bureah is very clearly ‘size to raise 70 per cent of Government revenues. He col- -Jects $2,790,000,000 a year in internal in|€Xchange is steady; prices are even turn and pays the fax he estimates to be due. The return is then audited and THE. SUNDAY STAR. WASHINGTON, "D. C., JUNE 23, 1929—PART 2. Labor Now at the Helm Ramsey MacDonald and His Cabinet Have Confidence of People—Socialism Not Feared BY C. PATRICK THOMPSON. GAIN the leaders of the Labor- Soclalist party in England have - swarmed onto the gavernment benches in Parliament and into the ministerial chairs in .the administrative offices in Whitehall—and grabbed the tiller of Britain's ship of state. And now apprehensive old ladies in the select residential neighborhoods and | retired colonels and merchants in the| detached villas at the spas and fash- | fonable coast resorts are cocking an ap- prehensive ear for the rumble of tum- brils. But, as the Right Hon. J. H. Thomas, M. P., his majesty’s new lord privy seal, | an ornamental office which leaves him free to tackle the unemployment prob- | lem for the new government (see Jim | Thomas, engine driver and trade union leader), sald to his friend Sir Josiah Stamp, chairman of England’s biggest rallway group, British reparations ex- pert at Paris and standard bearer of the capitalists, at a dinner party on Stamp's return from the reparations conference: “Tumbrils, Josiah? There ain’t going to be no tumbrils. Did you hear that one about the young lady of Gloucester?” And so on. There are no tumbrils; there is no revolutionary atmosphere in England. Consolation Parties Staged. ‘The rich friends of Lord Beaverbrook | and Lord Rothermere, the owners re- | spectively of the Qaily Express and the Dally Mail, two of the bl t national newspapers, have been cursing them for carrying their feud with Stanley Bald- win (who has consistently ignored them during his period of power) to the pitch of withholding their enthusiastic support from his party—being appre- hensive of additional super-taxes being imposed upon millionaires by Mr. Philip Snowden, now in charge of the treasury and revenues. Pretty girls are giving parties of con- solation to the younger sons of mar- and magnates who falled to beat their Labor-Socialist opponents at the polls. But still Mayfair does not shud- der as it a lamp post. The stock . BY HENRY W. BUNN. HE following is a brief summary of the most important news of the world for the seven days ended June 22. * x ‘THE BRITISH EMPIRE.—Completed returns of the general elections show the distribution of the 615 seats in the new House of Commons as follows: * ok Laborites, 289; Conservatives, 260; Liberals, 58; Independents, 4; National- ists (Northern Ireland), 3; Prohibition- ists, 1. The independents include two Independent Liberals and two Independ- ent Conservatives. On July 2 Lord Amthill will lay the foundaticn stone of the new Shake- speare Memorial Theater at Stratford- on-Avon. The American Shakespeare | Foundation has contributed nearly $600,000 toward construction and en- dowment of the building. A room in Houghton House near Bedford, the which mansion was the “original” of the house beautiful in “The Piigrim's Progress,” has been bought up by a group and presented to the Brilish nation. It is to be removed to the Victoria Albert Museum at Ken- sington and there set up permanently. It is said to be the finest Jacobean paneled interior in existence. Houghton House was built about 1615 for Mary Sydney, Countess of Pembroke and sister of the incomparable Sir Philip Sydney, the same lady whom Rare Ben Jonson eulogized in immortal lines. A manifesto issued by the Liberal party just before the recent general elections contains the following inter- esting statement: (The Liberal party pledges itself) “To accept naval parity with the United States in spirit and letter. To work out an agreement to limit and reduce naval armaments on the basis forwarded by Hugh 8. Gibson, American, at Geneva. To consider what changes should be made in international law relating to neutral and belligerent rights at sea as the result of ratification of the cove- nant of the League of Nations, the Bryan treaties, the Washington :m'i‘ Pacific treaties and the pact of Paris. Laborites are apt to regard the Kellogg act as “the agreed basis of a new international order.” Soon the R-100 and R-101, greatest of airships, will be mnking their trial flights, on the riult of which the im- mediate future oi lighter-than-air craft so greatly depends. No, no, old Leo Britannicus is not asleep. The General Assemblies of the Church of Scotland and the United Free Church of Scotland have voted for union of those bodles as the Church of Scot-| land; effective in October. Thus &/ negoliation of 20 years is crowned. It| is announced that the new church will | explore the proposals for a closer union | of all the British Protestant Churches, | advanced many years ago by an Arch- bishop of Canterbury and known as-the Lambeth proposals. A minority of the United Bree Church refused to join the union and will main- tain the old establishment. With results as to only two seats still unknown, returns of the recent general elections in the Union of South Africa Assembly of that Domin- Nationalists (the govern- ment party, headed by Hertzog), 76; the South African party (headed by Gen. Smuts), 61; the Creswell Laborites, sup- porters of the government, 5; the Na- tional Council Laborites, opposed to the government, 3; Independent, 1: un- known, 2. Tl::l m‘::a of O‘he hflecuon were _exceed| portant, complicated. I {mpe to find space in tfi near future for a briet exposition new Legislatis jon as follows show the distribution of seats in the | J. RAMSAY MACDONALD, improving. None of the magnificent fetes and festivities planned in connec- tion with the glittering London season have been canceled or curtailed, Pur- veyors of top hats continue to do their normal business. And the market for luxury automobiles, * which had faded out for two months prior to the elec- tion, is reported to be recovering. The situation is that the Labor-Social- | ist party, with 30 more members in Parliament than-the Conservatives, has taken office but is powerless to put its basic policy of socialism into practice because the combined anti-Boclalist forces outnumber it by 28. Can Recognize Russia. Ramsay MacDonald, the new prime minister, can go ahead and recognize Russia, make a deal with the United States for a drastic reduction 6f navies, add to the tax burden of the very rich, reorganize the rallways, drop ice into the warm cordial Sir Austen Chamber- lain has been handing France at Ger- | many's expense and even reform the electoral system. But any attempt to introduce legisiation designed to replace the private control of business by state control (coal mines always excepted) will bring Lloyd Geotge and his little band of 58 Liberals into action on the Conservative flank, and MacDonald will be defeated on the fioor of the House. That would mean another general election on the straight issue of social- ism versus individuclism, which is the issue MacDonald and his strategists want brought up—yet. To grasp the prospect now, one needs to glance back at the highlights of the recent elections. The most important facts that emerge from the melee are, first, that England is in a state of flux and does not know at the moment just In the recent vincial general elec. | tions-in Saskatchewan Province, |ada, the Liberals were badly beaten, |losing the power they had held for a quarter of a century. * x % % HUNGARY.—In a speech the other day at the unveliling of a memorial to Hungary'’s unknown soldier, Count Bethlen, premier of Hungary, declared that there will be no “King question” in | Hungagy so long as Admiral Horthy, the regent. lives. There is some hope that the admiral, a robust man, will live long enough for Hungary to forget it. But if Hungary tends to become in- different to St. Stephen’s crown, not 50 as to the Trianon treaty. “No, no; never!"” is placarded ever more widely, and the sentiment it e; burns rver more fiercely with the trace of | time, - HENEVER on hard up for a subject he can always write d couragingly about the fall of Rome. He can point out with what awful speed America is hasten- g to the same destru We are taxi Rome fell ause thrift was swallowed up in luxury. We are not thrifty. Rome fell because citiz ceased work and devoted them- selves to play. Rome spent millions on her sports we spend hundreds of millions. See how the shoe fits? But the Romans did not play; they watched other men play. America is still everybody work becoming a nation where every- body also p'a i ars ago a man felt like apologizing to his /bo: playe: he time is coming when he will have to explain why he does not play. Employers want men who can bring to their work more than mere dogged loyalty. asm; a fresh iew; a mind that | s more than build s—more than cleanse character; self- control. ‘ The school and the office, as Dr. Luther Gulick has. pointed out, are not democrac they a monarchies. You may not like the rules, but you must abide by them neverthel You may want te quit, but you can't. But pl different. You enter it of your own veli- tion; you may withdraw when | what she does want, and, second, that, although the Socialists talk joyously of | having swept the country, they polled only 8,400,000 votes against 14,000,000 | registered against them (5,000,000 of the | electorate being too bored to come oul and vote for anybody). Vote Against Baldwinism. ‘The big vote was against Baldwinism, not for socialism. Stanley Baldwin, with his policy of tranquillity, was a ! reaction from the overlong spell of the | indefatigable and exciting Lloyd George. | He overstayed his welcome. His “safety first” appeal struck the cold minds of cautious bankers and | millionaires - and non-producers living | on the interest of invested capital. | A large percentage of the Conserva- tive - votes were cast not s0 much to | keep Baldwin and his crowd in as to | keep the Socialists out. | At the height of the election one | heard prosperous persons saying in fashionable restaurants, at Mayfair dinner tables and in clubs: “If we lose, it will. be Baldwin's. fault. He has had the biggest majority in history for five years. And what has he done with it? Nothing.” What the critics would have done with it if they had been in Baldwin's place they were less ready to say. (Al- though I did hear one otherwise in- telligent and quite sane man seriously suggesting that the trade unions should have been abolished.) But this general reaction against Baldwin—that honest, well meaning, worthy and very English man—oper- ated to make the Conservative vote stick and created apathy where a vigorous and even a passionate enthu- siasm was needed to win the day. On_the Socialist side, the concentra- But no; Hungary is not turning dem- ocratic. The popular suffrage is a joke, for there’s no secret ballot. the most reactionary of countries. Th government is in effect a dictatorship, with Sphinx Bethlen for dictator. caste distinctions are even more ly maintained than of old. The num- ber of officers in uniform adorning the Hungarian landsca is quite ex- traordinary. Though Hungary has no seacoast, she maintains a naval admin- istration. ‘magnificent Premier Bethlen is a cypic, who manages so well that he can afford himself the Iluxury of clemency, forego it quire, L ITALY.—Premier Mussolini has strict- ly forbidden all beauty contests in Italy, and all organizations of Fascist women have been ordered to ‘“observe the BY BRUCE BARTO you will. If you abide by the rules, is because you control yourself, not because a master controls you. If you want to quit in a huff, there is no ‘one to prevent If you pout under defeat, or be- come arrogant with victory, you are answerable to yourself alone. In business you are controlled; in play you must be self-con- trolled. “The Battle of Waterloo w. won first on the English cricket fields.” Many a man on Monday morn- ing, when business would not go as it should, has held him: Saturday afternoon, when a little ball would not do what it should, he lost neither his temper nor his nerve. It is p of course. Herbert Spencer was very proud of ‘his game of billiards. One evening he invited a strange young man to Th sible to overdo play, the third game Herbert Spencer put up his cue in disgust. “Young man, to play a geod n of a misspent youth.” But mosl in no danger of overdoing pla; We are much more likely to go pounding along, saying to ourselves: “Tomorrow, when | have accumulated my pile, | will play. 3 And some day they will carve over us: “He was going to play— tomorrow.” Of all th that i worst! ly one of the (Copyricht, 1929.) l?uh only from | though he would probably | instanter should occasion re- | tion of the whole campaign on unem- | ployment was the decisive factor. Not | half of the electorate had any definite 1dea about the policies of the three rival parties, but some millions of people were willing to believe the general So- clalist assertion that if they were re-| turned, they would do more in a year "to solve the unemploymen than the Torles could or w a century. The Soclalists iss precise scheme; they just asked for a| blank check, and in the great industrial | areas the fuctory hands gave mass votes for them, and the working lassies also lined up and voted for MacDonald. In unprecedented numbers the small | salary class, feeling that the Socialist | leade®s stand closer to them than do the ‘Tory leaders, and that there are too many very rich men as compared to the vast army of the poor, voted for Mac- Donald. State employes, even those in the higher offices, voted for MacDonald. Being permeated with socialistic doc- _trines, they feel they would be the privi- leged class under a government bent upon bringing a large part of the na- | tion's activities under the control of | state officials. The intelligentsia are | socialistic to a man—and woman. i Finally, there are the middle-class folk who hitherto have voted solidly for | conservatism because it was the proper thing to do and because they had a class | hostility to labor, but who are voting increasingly socialistic today because they feel that the men in power in the rvative party are doing nothing for them and can do nothing for them. So Ramsay MacDonald, sitting in the pleasant, flagged garden of his home at enormous Tory majority and bring the premiership again within his grasp. It was uncertain over the week end following _the Lioyd George, who held the balanceé of power with his. little band, would do. Some prominent Tories advocated a Liberal- Conservative coalition—anything to keep the Soclalists out. But passions have Tun too high for ¢ ‘(Continued on Sixth Page.) % election what The Story the Week Has Told greatest decorousness in dress”; skirts to reach at Jeast 2 inches below the knee. When this sort of thing was tried on in republican Rome, the women marched on the Senate chamber and puled the gray-beards' hirsute honors, with result well known. And already we hear of complications. At Genoa & band of ardent reformers stopped on the street all “feminine creatures” with short skirts, and marked with black int on their stockings the minimum limit to which their skirts should de- | scend. Result: A glorious scene of fisti- cuffs between the reformers and the | fathers, brothers and admirers of the “feminine creatures.” The Itallan uni- versity student is not permitted to go bareheaded. 1In the interest of the Italian straw hat industry he is re- quired to wear a straw hat this Sum- mer; so he is informed by a circular issued by Turati, secretary general of the Fascist party. From this safe dis- tance, we say, “Fiddle-de-dee!” Despite Mussolini’s injunctions, the Italian birthrate continues to fall. * Ok Kk ALBANTA.—The foundation has been laid for a new palace for King Zogu of Albania, to cost a million dol- lars, the architect and builders being Italians. It is at the center of a group of government buildings already under construction. Zcgu already has four royal palaces and & sixth is planned at the site of the house in which the immortal Scanderberg was born. No doubt Zogu needs all these places, and that the Albanian people as well as the Italian contractors will be ade- quately benefited by the new construc- tion, even though Albania is desperately poor. * ok ok ok CHINA.—Anent the very strained re- lations between China and Russla re- sulting from the raids by officials of the Manchurian government on Rus- slan consulates in Manchuria in the expectation of discovering compromis- ing matter (it is given out that very comrlrommnl documents were found), it should be remembered that under the Portsmouth treaty Russia was given the right to maintain a force of about 25,000 in Northern Manchuria to guard the Chinese Eastern Railway (under joint. Sino-Rugsian control). It is obvious what a dangeroug situation would-be created should Moscow see fit to exercise this right. There seems no doubt that since development of the. present crisis considerable Russian forces have been assembled on the Russian side of the frontier between Manchuria and the Far Eastern Re- public (a member of the Union of Socialist Soviet. Republics). No ac- tive hostilities are reported between forces of the Nanking government and those of Feng Yu-Hslang, supertuchun of Honan, Shensi and Kansu, * Kk % x UNITED STATES OF AMERICA.— | On June 17 Senator Borah’s resolution | to limit tariff revision to farm products and closely related schedules was voted down in the Senate, 39 to 38, and the | same day the Senate resolved to recess | | from Wednesday evening, the 19th, to ' | August 19, provided the House should similarly resolve. The House obliged and then some, for it recessed to Sep- ! tember 23. On June 19, just before adjourn- | ment, both houses of Congress d the resolution sponsored by the admin- istration providing for postponement from August 1, 1929, to May 1, 1930, of the due date of the debt of approxi- mately $400,000,000 owing our Govern. ment from the French government upon the account of war stocks left by us in Ly W Hampstead on the heights outside of . London, saw a landslide sweep away the ther coalition to be | BRITAIN MOVES TO CAPTURE : BY GASTON NERVAL. Authority on Latin American Affairs. HILE the Congress in Wash- ington is endeavoring to put through a new tariff bill which, it is agreed by some, _will be a tremendous blow to the export trade of this country wi Latin America, Great Britain is engagt in studying economic conditions in that region in order to find the best means of increasing British trade with Latin America. The Chamber of Commerce of Lon- don, according to cable advices, re- cenfly announced the salling of & com- mission of four British experts for Bra- zil and Argentina, where they are to study economic conditions and the op- portunities and methods for increasing commercial interchange between the British Empire and these two principal Latin republics of the New World. After having achieved great success in Russia and Australia, British com- mevos oW SROboME to better its posi- tion in South America, where, since the ‘World War, it has fallen to third place, giving way to the United States and to Germany. British industrialists and exporters have supported enthusiasti- cally the sending of this commission, for they not only understand the im- portance of the Argenine and Brazilian markets, but they also realize that their commercial predominance there assures their attaining it in the other markets of Latin America. Great Men on Commission. ‘The importance of this commission in the eyes of British commerce is evi- denced by the type of men chosen as its members. The chairman is Viscount d'Abernon, the first British Ambassador sent to Germany after the war, who enjoys_world-wide prestige as a finan- cler. Before the war he was financial adviser to the Egyptian government and later was made chairman of the trade commission of the British do- minions. Accompanying him to South America are Sir William Claire Lees, a director in important textile interests; E. G. Rowland, head of a great engi- neering corporation, and Julian Piggott, former British commissioner in Cologne, representing the iron and steel indus- tries. Since the -will visit of the Prince of Wales to South America, British interests in those markets has been increasing. When the prince re- turned to London, he stated that Latin America was a region of “limitless possibilities,” and advised young Eng- lishmen to study Spanish. The im- proved conditions of British relations with the nations of the Southern Con- tinent is shown by the fact that the investments of British capital in Ar- gentina and Brazil alone now have reached a total of 500,000,000 pounds sterling. U. S. Competition Has Been Too Strong. Nevertheless, until recently it could not be said that Great Britain has taken the trouble to attempt a “con- quest” of the Latin American markets. The competition of the United States was_too strong to admit of foreign rivalry. Now, however, when certain Prance and purchased by the French government (on which transaction, by the way, France lost heavily), on con- dition that prior to August 1, 1929, the French Parliament ratifies the Mellon- Berenger agreement. The latter agree- ment provides for payment over 62 years of the French war debt owing us, the total to include the war stocks debt, though the latter is, strictly speaking, & | commercial debt, so as to include on condition of ratification of the agree- ment (by the legislatures of both Prance and the United States) prior to August 1, 1929, the original due date of the war stocks debt. Now, you see, our Congress won't ratify before ratifica- tion by the French Parliament and, in view of its recess, the only way to sate the situation for France in regard to the war stocks debt was by way of the resolution of postponement. As the matter now stands, for France to obtain the much desired easement regarding the war-stocks debt, the French Parliament must ratify that agreement prior to August 1, 1929, and our Congress must ratify that agree- ment prior to May 1, 1930. Obviouslv the important question is: Will France ratify before August 1. If she does, ratification by our Congress should speedily follow. It may not be amiss to present again President Hoover's definition of the scope of the work of the National Law Enforcement ‘mission, as follows: “1. To critically consider the entire Federal machinery of justice, redistri- bution of its functions, simplification of its procedure, revision of additional spe- cial tribunals, better selection of juries and more effective ization. of agencies of investigation and procedure. “2. To cover the entire question qof law enforcement and organization of justice. “3. To consider the methods of en- forcement of the eighteenth amendment and abuses which have grown up, to- gether with the enforcement of the laws In respect.to narcotics, immigra- tion, trade restraint and every other branch of Federal Government law en- forcement. “4, To provide adequate organiza- tion of our judicial enforcement sys- tem.” There are indications that our col- leges have reached the saturation point in respect of enroliment. On' the whole, that is good new: ‘The yein of ural gas recently dis- covered in Utah is said to be unique in its helium percentage, namely, 7.07. The Texas deposit, which has been supplying the helium for our military dirigibles, boasts only 1.75 per cent. It is to be hoped that the Utah deposit comes up to the reports thereof, which give it out as equally, wonderful for quality and quantity; as the Texas de- posit is very limited and the cost of extracting its helium content is very considerable, * kX NOTES.—France now leads the coun- tries of the world in number of inter- nationally recognized land plane records. She holds 13 and Germany 12, while the United States, Great Britain and Italy are tied with 3 each. But in seaplane records we lead, with 16; Ger- many has 15, Italy 2 and France and Great Britain 1 each. “Budapest bars talkies.” Good old Budapest. We are informed on good authority that harvest prospects have taken a turn for the better throughout the Union of Soclalist Soviets Republics. that grain collections have jumped upward; that the total sown area }! equal to if not greater than last, year's, the numerous g:xnmisuc rumors in the opposite sense being happily discredited. France and Turkey continue at odds over the Turko-Syrian frontier. Suc- cessive dual negotiations have broken down. Turkey is said to contemplate bringing the dispute before the World Court. The new Shah of Persia is having a lot of trouble with recalcitrant tribes, but the general indication is of steady it slow realization of his policies making for modernization and economic re- habllitation. ‘The population of South America has increased by about 40 per cent. | Since 1913 faster than that of any | other continent. Its production of foodstuffs and raw materials has just | kept pace with the population increase, but its international trade has grown only half as fast. In the same period the population of Asia in by only 7 per cent. according to a morandum issued by the League of mel Na th | od | LATIN AMERICAN MARKET Tariff Increase by U. S. Would Injure Trade of This Nation and Open Way for European Competitors, Is Claim. circumstances are making conditions unfavorable for United States trade, and when some of the Latin countries are seeking a market for their products on the other side of the Atlantic, Brit- ish commerce is undertaking a real “offensive” to capture the South Ameri- ~an markets, the first step of which is the sending of this commission to Ar- gentina and Brazil. At almost the same time. a dispatch from Spain states that the German government. has opened a remarkable exhibition of its products in the Barce- lona exposition, with the avowed e pose of attracting Latin American ‘merchants and tourists, thus commercial interchange between Ger- many and Latin America. Meantime, here in Washington, where the enthusiasm aroused by President Hoover's good-will trip has hardly ceased to echo, the Congress is raising = tarift wall, especially against products of many ‘of the nations south of the Rio Grande, the mere discussion of which has raised storms of protest in Latin America, , ‘Tarift lo Decrease Exports. High tariffs on the principal export products of the Latin American coun- tries will cause an enormous decrease in their trade with the United States. They will have to seek new markets for their products where duties are lower, and. what is more serious, they will ='so seek new sources of supply for the rian- ufactured articles which they buy. Im- ports are closely related to exports. Where the exports of Latin Ameriea go, there she will buy her imports. The country that purchases the largest amounts of Latin American products will have the best opportunity for sell- ing the largest amount of its manufac- tures in Latin America. This is logical and natural. Moreover, the raising of tariffs by the United States will ish the purchasing power of the ex- porting nations and cause them to dis- continue buying in the United States on their former large scale. ‘The case of Cuba is a good example. Since the United States raised the tariff on Cuban sugar, seven years ago, the export trade of that nation has de- creased 35 per cent. Politically the danger is greater, be- cause it is well understood in these days that political misunderstandings bring about great economic disasters. Dimin- ishing the good will of the Latin Ameri- can nations will greatly diminish the opportunities for United States trade in those countries. Lacking opportunities, there can naturally be little success. We do not mean to say that at the present, time this good will is lacking. | On the contrary, now, more than ever | before, the Latin American blies are desirous of closer relations with the United States and seem to understand better than ever before the ideals of its people. Threatens to Arouse Distrust. Nevertheless, the high tariff policy threatens to arouse suspicion and dis- trust and may. cause changes of opin- jon of political importance in some states south of the Rio Grande. In time high tariffs will do more to. harm the United States than the much-dis- cussed so-called “Yankee imperialism,” which has hampered for so many years the cause of pah-Americanism, and which is just beginning to disappear. “The North Americans, when they take up this question of the tariffs, do not take the factor of friendly feeling— good will—into consideration,” a Latin 5,” he added, “tha! e - ;mant factor, for we are accustomed to direct our policies in accordance with our -sentiments of friendship. Wher¢ we receive the best treatment we give best consideration, and with our con- sideration go our commerce, our prod- ucts, our markets, which today are un- questionably the object of the keenest competition in the world.” “How is it possible,” ask the Latin Americans, “that a nation which is working, to win the mbuu wflldo'!‘ Ep Spanish-speaking repul an - ug::ted in their commerce is at the same time trying to shut its ports to their principal products, thus injuring the most important part of their eco- nomic systems?” ‘The alarm felt in Latin America over the probability of increased tariffs is so great that even in this country the press and the export trade agencies are working energetically against the pro- posed high duties on certain Latin American products. They understand the immense damage such increases would cause and they realize the im- portance today of the Latin American markets. Three Countries Hit Hardest. A mere glance at some of -the pro= posed increases affecting Latin Ameri- can commerce shows this alarm is not wholly without foundation. Cuba, Argentina and Mexico would suffer the heaviest burdens. Cuban sugar, which now pays a duty of 1.76 cents per pound, would have to pay 2.40 cents: that on leaf tobacco has been raised from 2.10 to 2.50 cents per pound and that on stemmed tobacco from 2.75 to 3.15 per pound. The first of these new duties alone would cause & general financial crisis on the island, for the whole country lives on the sugar industry and would cause the loss to the United States of her best friend and best customer in Latin America. Cuba's export trade in fruits, oranges, pineapples and grapefruit and in pota- toes, onions, fresh beans, tomatoes, peppers, etc., also would suffer from increases averaging 100 per cent. Argentine flaxseed, a $25,000,000 item in her exports to the United States, has heretofore paid a duty of 40 cents per bushel. This has just been raised by the President, under the flexseed tariff law, to 56 cents, and the new bill pro- vides for an increase to 63 cents per bushel. The duty on corn would be raised from 15 to 25 cents per bushel. Heavy increases, in some cases as much as 100 per cent. in the duties on vari- ous classes of hides, on wool, and on butter, cheese and casein, as well as those on certain kinds of fresh fruits, would seriously affect Argentine ex- porta. Turkey Tariff Hits Uruguay. Mexico's exports to the United States of cattle, fresh beef and veal, hides end wool, and all kinds of fresh vege- tables and lits would be subject to: extremely high duties under the new aw. | | | | The increased duties on hides, wool, ete., would affect the exports of Uru- guay, Paraguay, Brazil, Peru, Vene- zuela and Colombia. Uruguay has been working up a good trade with the United States in dressed turkeys; on these the duty would be heavily in- creased. Chile has a good trade in fruits, onions and potatoes, which would suffer under the new law.. Increased dutles on a0 would injure the ex- ports of Ecuador, Brazil, the Dominican Republic, Haiti and Venezuela, and in IJuer degree that of many other na- ions. These are by no means all the duties which would affect Latin-American trade in the new bill being discussed in Ce ess. The space of this article precludes even enumerating them, or giving details on the few we have men- tloned. However, the latter suffice to explain the alarm with which Latin Americans regard question. As for the important influence which these tariffs will have-on the future political and economic relations of the United States and Latin America there is now no room for doubt. Argentina and Cuba policies of tarifls e Onited are for reprisals in the TR b