The San Francisco Call. Newspaper, May 21, 1895, Page 3

THE SAN FRANCISCO CALL, TUESDAY, MAY 21, 1895. 3 KILLS ALL THE ACT. Second Decision of the Supreme Court on the income Tax. PROVISIONS ARE ILLEGAL Five Justices Declare Whole Law to Be Un-~ constitutional. the FOUR DISSENTING OPINIONS. Harlan, Jackson, White and Brown Bitterly Assall the Action of the Majority. WASHINGTON, D. C., May 20.—The income tax law which has received so large a share of the public attention since the beginning of the regular session of the Fifty-third Congress is a thing of the past. After being twice heard in the United States Supreme Court, it was finally de- cided to-day by the court to be invalid and unconstitutional. There were four dissenting opinions de- livered in these cases to-day, one each by Justices Harlan, Brown, Jackson and ‘White, showing that the court had stood five to four against the law. Inasmuch as one of these dissenting opinions was handed down by Justice Jackson, and as he was absent at the first hearing when the court divided evenly on the question of sustaining the law on all points except those as to the tax on in- comes from rents and bonds, it follows that one of the members of the court who at first pronounced for the law, except on those two points, changed his attitude after the second argument. There is very little question that Justice Shiras is the Justice who changed his views on these points. He made no an- nouncement, either to-day or when the first opinion was delivered, as to his opin- ion. While the opinion of the Chief Justice was largely in review of the general aspects of the ques- tions involved, he based his opinion of the court to-day upon the argument that the provisions of the law regarding the tax on rents and bonds were so essentially a factor of it as to render all other parts of it dependent on them, and in accordance with the well-known rule of law bearing on this question, the law as a whole must be declared invalid. The opinions of Justices Harlan and White were concluded in language so vigorous and were so emphatic in their gnment of the majority as to cause general comment. Both Justices in- ated their belief that the ruling opinion was revolutionary, and intimated that s consequences might ensue. Jus- Harlan suggested the necessity for amending the constitution in view of the opinion, The courtroom was packed during the entire three hours when the opinions were being delivered. The unexpected event of v was in the appearance of Justice Ja:kson. He had announced after casting his vote last Saturday week that he would return on the following Monday to Ten- nessee, but it sppears that instead he went to Philadelphia to consult a specialist on internal diseases. He left the bench im- mediately after delivering his opinion to- day, and it is understood will now pro- ceed South. He delivered his opinion from notes. It should probably be stated that while the cases in which these operations were delivered are uniformly characterized as the income tax cases they are known on the court dockets as the casesof Charles Pollock vs. The Farmers’ Loan and Trust Company and Louis H. Hyde vs. The Con- tinental Trust Company of New York, both appealed from the .Circuit Courtof the United States for the Southern District of New York. FULLER’S OPINION, Unconstitutionality of a Portion of the Law Necessitated the Death of the Whole. WASHINGTON, D. C., May 20.—Imme- diately on the convening of the court, Chief Justice Fuller read the income tax opinion. He said: ‘Whenever this court is required to pass upon the validity of an act of Congress as tested by the fundamental law enacted by the people, the duty imposed demands in its discharge the exercise of the utmost deliberation and care, and invokes the deepest sense of our responsi- bility, and this is especially so when the ques- tion involves the exercise of great govern- mental power and brings into consideration, as vitally affected by the decision, that com- plex system of government so sagaciously framed as to secure and perpetuate the inde- structtble Union composed of indestructible States. We have, therefore, an anxious desire to omit nothing which might in any degree tend to elucidate the questions submitted, and, mided by able arguments embodying the fruits of elaborate research, we have carefully re- examined these cases, with the result that, while our former conclusions remain un- ‘changed, their scope must be enlarged by the acceptance of their logical consequences. Our previous decision was confined to the consideration of the validity of the tax on an income from real estate, and on an income from municipal bonds. The question thus limited was whether such taxatlon was direct or not in the meaning of the constitution, and the court went further as to the tax on in- comes from real estate than to hold that it fell within the same class asa source whence income was derived; thatis, that the tax upon realty and the tax nupon receipts therefrom were alike direct; while, as to the income from municipal bonds, that could not be taxed, because of the went of the power to tax the source, and no reference was made to the nature of the tax as being direct or indirect. We are now permitted to broaden the field of inquiry and determine whether the tax shall be derived from rents or products or otherwise, of real estate or stocks or other forms of personal property. We are unable to conclude that the inforced substraction from the yield of all owners of real or personal prop- erty in the manner preseribed is so different from the tax upon property itself that itis Dot an indirect tax in the meaning of the constitution. The words of the constitution are 10 be taken in their obvious sense and have & reasonable construction. We know no other reason for holding otherwise than that the words “direct taxes” on one hand and “Dutch imposts” on the other were used in the constitution in their natural and obvious Senses, 10T in arriving at what those termsem- brace do we perceive any ground for enlarging them beyond or narrowing them within the natural’ end obvious import at the time the constitution was framed and ratified. And passing from the text we regard the conclusion reached as inevitable, when circumstences which surrounded the convention and con- trolled the action and view of those who framed and those who adopted the consti- tution are considered. The Chief Justice discussed the reasons for the constitutional provisions regarding direct taxation. States had plenary powers, he said, but they gave up great sources of revenue derived from com- merce and retained the power of levying taxes and duties covering anything other than excises, but in respect to them the range of taxation was narrowed by the power granted to the Federal Government over interstate commerce. While they granted the power apportioning direct tax- ation, they secured to the States an oppor- tunity to pay the amounts apportioned and to recoup from their own citizens in the most feasible way. The opinion con- tinued: Itis said, on the whole, that the income of property is not a direct tax, butduty. We do not think so. Direct taxation was not restricted in a breath, and restriction blown to the winds is enother. The opinion dismisses the Hylton case with this comment: ‘What was decided in the Hylton case was that the tax on carriages was an excise and therefore indirect tax. The opinion next took up the argument that the tax upon property is not a direct tax within the meaning of the constitu- tion, and said: We find it impossible to hold thata funda- mental requisition, deemed so important as to be enforced by two provisions, one affirmative and one negative, can be defined away by forced aistinctions between that which gives value to property and property itself. Stress of argument is thrown, however, on the asser- tion that the income tax isnot a property tax atall; thatitis an assessment upon the taxpayer on account of his money-spending power as shown by his revenue for the year preceding assessments; that rents received, crops har- vested and interest collected have lost all con- nection with their origin, and although once not taxable, have been transmuted in their new form into taxable subject matter. In other words, that the income is taxable irrespective of the source from whence it is derived. The Chief Justice said that since the court had held unanimously that receipts from municival bonds should not be taxed, because bonds were instruments of States, the same rule applied to revenue irom other sources not subjected to the tax, and the lack of power to levy any but appor- tioned tax on real and personal property equally exists as to revenue therefrom. The court does not understand that an in- come tax has ever been regarded in Eng- land as other than a direct tax. After a review of the cases and con- sideration of arguments of counsel, the court as it approached its conclusions made the following general argument: Ifit were a fact there had been no income taxlaw such as this at the time the constitu- tion was framed and adopted, it would not be of controlling importance. A direct tax can- not be taken out of the constitutional rule be- cause the particular tax did not exist at the time the rule was prescribed. As Chief Justice Marshall said in the Dart- mouth College case: “It is not enough to say that this particular case was not in the mind of the convention when the article was framed, nor of the American people when it was adopted. It is necessary to go further and to say that had this particular case been sug- gested the language would have been so varied as to exclude it, or it would have been made a special exception.’” The case: being within the words of the rule, must be within its operation likewise, un- less there be something in the literal con- struction so obviously absurd or mischievous or repugnant to the general spirit of the in- strument as to justify those who expound the constitution in making it an exception. The tax being direct, and therefore to be laid by apportionment, is there any real difficulty in doing so? Cannot Congress, if the necessity exists of raising thirty, forty or any other num- ber of million dollars for the support of the Government, in addition to the revenue from duties, imposts and excises, apportion the quota of each State upon the basis of census and thus advise it of the pay- ment which must be made and pro- ceed to assess that amount on all the real and personal property or the income of ull persons in the State and collect the same if the States donot in the meantime assume and pay their quota and collect the amount according to their own system and in their own way? In- conveniences might possibly attend the levy of an income tax, but that it is apportionable is hardly denied, although it is asserted that it would operate so unequally as to be undesir- able. Itis spparent that the suggestion that the result of compliance with the fundamental law would lead to the abandonmentof that method of taxation altogether, because of in- equalities alleged to necessarily accompany its pursuit, conld not be allowed to influencet h conclusion, but the suggestion not unnaturally invites attention to the contention of appel- lant’s counsel, that the want of un formity and equality in this act is such as to invalidate it. And fipures drawn to the class of direct taxes; if it does, it is be- ing apportioned in violation of the constitu- tion, and we must so declare. Differences have often occurred in this court, differences now exist, but there has never been a time in its history when there has been 2 difference of opinion as toits duty to announce its deliberate conclusions unaffected by considerations not pertaining to the case in hand. 1f it be true that the comstitution should have been so framed that a tax of this kind could be laid the instrument defines the way for its amendment. In no part of it was greater sagacity displayed. Except that no State, without its consent, can pe deprived of its equal suffrage in the Senate, the constitu- tion may be so amended upon the concurrence of two-thirds of both houses and the ratifica- tion of the Legisiatures of two-thirds of the States. The ultimate sovereignty may be thus called into place bya slow and deliberate process which gives time for a mere hypothesis to ex- haust itself and the sober second thought of every part of the country to be asserted. Being of the opinion that so much of the sec- tions of this law as laysa tax on income for real and personal property is invalid, we are brought to the question of the effect of that conclusion upon these sections as a whole. Itis elementary that the same statute may be in part constitutional and in part unconstitu- tional, and if the parts are whol- ly independent of each other that which is constitutional may stand while that which is unconstitutional will be rejected. And in the case before us there is no question as to the validity of this act, except sections 27 to 37 inclusive, which relate to the subject which has been under discussion, and as to them we think the rule laid down by Chief Justice Shaw in Warren vs. Charles- ton is applicable; that if the differ- ent parts are so mutually connected with and dependent on each other as conditions, considerations or compensations for each other, as to warrant a belief that the Legislature intended them as a whole,and that if all could not be carried into effect the Legis- lature would not pass the residue independent- 1y, and some parts are constitutional, all the provisions which are thus dependent, condi- tional or connected, must fall with them. Or, as the point is put by Mr. Justice Mat- thews in Poindexter vs. Greenhowe: “It is un- doubtedly true that there may be cases where one part of a statute may be enforced as consti- tutional and another be declared inoperative aud void because unconstitutional, but these are cases where the parts are $o distinetly sep- arate that each can stand alone, and where the court is able to see and declare that the inten- tion of the Legislature was that the part pro- nounced valid should be enforcible, even though the other part should fail. To hold otherwise would be to substitute for the law intended by the Legislature one they may never have been willing by itself to enact.” And again, as stated by the same eminent Judge in Prague vs. Thompson, where it was urged that certain illegal exceptions in a sec- tion of a statute might be disregarded, but the rest could stand, “the insuperable difficulty with the application of that principle of construction to the present instance is that by rejecting the exceptions intended by the Legislature of Georgia, the State is made to enact what confessedly the Legislature never meant. It confers upon the statute a positive operation beyond the legislative intent and beyond what any one can say it would have enacted in view of the illegality of the excep- tions.” According to the census, the true valuation of real and personal property in the United Stetes in 1890 was $65,087,091,191, of which real estate with improvements thereon made up $39,544,544,333. Of course, from the lat- ter must be deducted in applying these sections all unproductive property and all property whose net yield does not exceed $4000, but, even with such deductions it is evident that the income from reality formed a vital part of the scheme for taxation embodied therein. If that be stricken out, and also the income from all invested personal property, bonds, stocks, investments of all kinds, it is obvious that by far the largest pert of the anticipated revenue would be eliminated, and this would leave the burden of the tax to be borne by professions, trades, employments or vocations, and in that way what was intended asa tax on capital would remain in substance a tax on oécupations and labor. We cannot believe that such was the inten- tion of Congress. We do not mean to say that an act laying by apportionment a direct tax on all real estate and personal property or the income thereof, might not also lay excise taxes on business privileges, employments and vocations. But this is not such an act, and this scheme must be considered as a whole. Being invalia as to the greater pert and falling as the tax would if any part were held valid, in = direc- tion which could not have been contemplated except in connection with the taxation con- sidered es an entirety, we are constrained to conelude the sections 27 to 37 inclusive of the act which became & law without the signature of the President on August 28, 1894, as wholly inoperative and void. FINDINGS OF THE COURT. from the census are given,showing that enor- mous assets of mutual insurance companies, of building associations, of mutual savings banks, large productive property of ecclesiasti- cal organizations are exempted, and that the exemptions reach so many hundred millions that the rate of taxation would perhaps have been reduced one-half if they had not been made. We are not dealing with the act from that point of view, but assuming the data to be sub- | stantially reliable, if the sum desired to be raised had been apportioned, it may be doubted whether any State which paid its quota and collected the amount by its own methods conld under its constitution have allowed & large pertof the property alluded to to escape taxa- tion. Ifso, & better measure of equality would have been attained than would be otherwise possible, since according to the arguments for the Government the rule of equality is not pre- seribed by the constitution as to Federal taxa- tion, and the observance of such & rule as in- herent in all just taxation is purely & matter of Jegislative discretion. Elaborate argument is made as to the effici- cacy and merits of an income tax in general, as on the one hand equal and just and on the other elastic and certain that it is not open to abuse by such deductions and exemptions as might make taxation under it so wanting in uniformity and equality as in substance to amount to deprivation of property without due process of law—not that it is not open to frand and evasion and inquisitoriel in its methods, but because it is pre-eminently & tax upon the rich and enables the burdens of taxes of consumption and of duties on im- ports to be sensibly diminished. And it is said that the United States as the representative of an indivisible nationality, as a political sovereign equal in authority to any other on the face of the globe, adequate to all emergencies, foreign or domestic, and having at its command for de- fense and for all governmental purposes all the resources of the nation would be but a maimed and crippled creation after all, unless it possesses the power to lay a tax on the in- come of real and personal property throughout the United States, without apportionment. The power to tax real and personal property and the income from both through ap- portionment is conceded; that such a tax i8 a direct tax in the meaning of the con- stitution has not been denied, and in our judgment cannot be successfully denied, and yet we are thus invited to hesitate in the en- forcement of the mandate of the constitution, which prohibits Congress from laying a direct 1ax on the revenue from property of the citi- zen without regard to State lines, and in such manner that the States cannot intervene by payment in regulation of their own resources, lest & government of delegated powers shonld Dbe found to be not less powerful, but less abso- lute, than the imagination of its advocates had supposed. We are not here concerned with the question whether an income tax be or be not desirable, nor whether such a tax would cnable the Government to diminish taxes on consumption and duties on imports, and to enter upon what may be believed to be a reform of its fiscal aud commercial systems. Questions of that character belong to the controversies of polis cal parties, and cannot be settled by judicial decisions. Insuch cases our province is to de- termine whether thisincome tax on the reve- nue from the property does or does not belong Text of the Decision Which Rendered the Income Tax Null and Void. WASHINGTON, D. C., May 20.—The conclusions of the court on the income tax were as follows: First—We adhere to the opinion already an- nounced that taxes on real astate, being in- disputably direct taxes, taxes on rents and on income of real estate are equally direct taxes. Second—We are of the opinion that taxes on personal property or on income personal prop: erty are likewise direct taxes. Third—The tax imposed by sections 27 to 37, inclusive, of the act of 1894, so far as it falls on the income of real estate and on personal prop- erty, is a direct tax within the meaning of the constitution, and therefore unconstitu- tional and void, because not apportioned ac- cording to representation. All these sections constituting the entire scheme of taxation are necessarily invalid. The decrees hereinbefore entered in this court will be vacated. A s HARLAN DISSENTS.. He Declares the Decision Strikes at the Very Foundation of National Authority. WASHINGTON, D. C.. May 20.—The Chief Justice was immediately followed by Justice Harlan in a dissenting opinion. Justice Harlan said that at the former hearing it had been adjudged that a tax on rents was a direct tax and must be apportioned among the States. He had dissented from that view, concurring in the able opinion of Justice White, to which he thought nothing could be added. He wanted, however, to add an additional authority, the opinion of Justice Strong, in the case of Clark vs. Sickle, which he quoted at some length. He said this de- cision was significant and meant that vir- tually all incomes could be taxed. Mr. Harlan said he would later file an opinion giving his views in detail, and his views as now printed will be of & gen- eral character. Capitalization taxes and taxes on land, he contended, should be considered as direct, and they had been uniformly held 8o to be. He quoted from the views of Justices Iredell, Patterson and others on the operation of the constitutional pro- vision as to the apportionment, holding that the rules had been consulted only when it could be reasonably applied. The changes contemplated from the former practice in this matter, Justice Harlan said, were little less than a revela- tion. Every one concedes the decisions in former cases would have been the same as they were if there had been no reference in the constitution to direct taxes. He held the tax on rentsto be a duty. or something entirely different from a tax on land from which rent was collected. He combated the idea that rents werea devise of lands, in view of the fact that the present law wasto continue in overation for only five years, A tax on land is gen- erally a lien on land, while that on rentsis not. In its essence a tax on rents is a tax on money and the tax is payable in money. He said the present decision was a step in advance of the court’s former decision, and said, incidentally, that the present conclusion kad been reached by a bare majority. In his judgment, to say noth- ing of former holdings of the court, the decision might well excite very grave ap- prehension. Continuing, he said: In my judgment this decision strikes at the very foundations of national authority, in that it denies to the general Government a power which is, or may at some time in a great emergency. such as that of war, become vital to the existence and preservation ot the Union. It tends to re-establish that condition of help- Jessmess in which Congress :found itself during the period of the articles of confederation, when it was without powers by laws operating directly upon individuals to lay and collect, through its own agents, taxes sufficient to pay the debts and defray the ex- penses of Government, and was dependent in all such matters upon the good will of the States and promptness in making the requi- sitions made upon them by Congress. In its practical operations this decision with- draws from national taxation not only all in- comes derived from real estate, but the per- sonal property of the whole country—personal property, bonds, stocks, investments of all kinds—and the income that may be derived from such property. This result is from the fact that, under the decision of the court, such incomes cannot be taxed otherwise than by apportionment among the States on tho basis simply of population. No such.apportionment can possibly be made without doing monstrous, wicked injustice to the many for the benefit of the favored few in particular States. Any attempt on the part of Congress to apportion taxation of incomes among the States upon the basis of their popu- lation would, and properly ought to, arouse such an indignation among the freemen of America that it would never be repeated. The American majosity practically decides that without an amendment of the constitution such incomes can never be made to contribute 10 the support of the National Government. If this new theory of the constitution, as I believe it to be—if this new departure from the way marked out by the fathers, is justified by the fundamental law, the American pcople cannot too s0on amend their constitution. The judgment just rendered defeats the pur- pase of Congress by taking out of the revenue not less than $30,000,000 and possibly $50,- 000,000 cxpected to be raised from in- comes. We know from the official regorts of both houses of Congress that taxation would not have been reduced to the extent it ‘was by the Wilson act but for the belief that if the country had the benefit of revenue derived from & tax on incomes, that could be safely done. In every possible way the two houses of Congress indicated that must be a part of any scheme for reducing the taxation and for raising revenue for support of the Government; that (with certain exceptions) incomes arising from every kind of property and from every trade and calling should bear some of the burdens of the taxation imposed. If the court knows or is justified in believing that Congress would not have provided an income tax which did not include & tax on incomes from real estate we are more justified in believing the Wilson act would not have become a law at all with- out provision being made for it in the income tax. If, therefore, all the.income sections of the ‘Wilson act must fall because some of them are invalid, does not the judgment this day ren- dered furnish ground for the contention that the entire acts fall when the court strikes from it all of the income tax provisions, without which the act would never have been passed? But the court takes care to state that there is onas to the validity of any part of son act except those sections which provide for a tax on incomes. Thus something is stated for the support and maintenance of the Government. The practical if not the direct effect of the decision to-day is to give to certain kinds of property & position of favoritism, an advant- age inconsistent with the fundamental prin- ciple of our social organization, to invest them with power and influence that is perilous to that portion of the people upon whom rests the larger part of the burdens of the Govern- ment, and who ought not to be subjected to the dominion of aggregated wealth any more than the property of the country should be at the mercy of the lawles STRIKES AT THE POOR. Justice Jackson’s Bitter Denunciation of the Action of His Con- freres. WASHINGTON, D. C., May 20.—The viewsof no other member of the court have been the subject of so much speculation as Justice Jackson’s, who, it was thought, would be practically a referee in the case. Justice Jackson said his health had not been equal to the task of preparing a for- mal decision, and proceeded to give an outline of his views from notes. His voice was at first feeble, but as he became inter- ested in his subject he was able to speak with more strength, although his reading was slow and interrupted by frequent fits of coughing. In beginning, Justice Jackson announced that he concurred fully in the dissents ex- pressed by Justice White on the former hearing, and the other Justices who dis- sented to-day. He said: It is not and cannot be denied that under the broad and comprehensive taxing power conferred by the constitution, Congress has the authority to tax incomes from whatso- ever source arising, whether from real estate, personal property or otherwise. It isequally clear that Congress, in exercise of its author- ity, has the discretion to impose upon tax in- comes above a designated amount. The un- denying and controlling question now pre- sented is whether the taxation of incomes received from land and personalty are subject to the rule of apportionment. It was not found, said the Justice, that there was any lack of uniformity in the legislation, and he could not understand the principle upon which the court reached the conclusion that because one branch of the law was invalid for the reason that the tax was not laid by the rule of appor- tionment it thereby invalidated another branch resting upon the rule of uniform- ity, and against which there was not valid objection. Ifthe conclusion of the court was sound the principle could, with equal propriety, be extended to the entire tariff act. The court took a wrong method of ar- riving at the meaning of the words *‘direct tax,” depending on the opinions of writers since the constitution, who agreed on nothing. It was never contemplated by the framers of the constitution to reach by direct taxation subjects of partial distribu- tion. What would be thought of a direct tax laid upon cotton at so much a bale; on tobacco or rice, property not existing in a majority of the States? They contemplated the apportionment of a direct tax on subject matter having general distribution among the States. They mever contemplated anything as a direct tax but that laid directly upon property itself accord- ing to valuation of assessment. No intention could be attributed to the framers of the constitution to make any tax a direct tax which it was possible to apportion. If a tax could not be appor- tioned among several States with reason- able approximation to equality to - all citizens of the country that should be evidence that it wasnot a direct tax within the meaning of the constitution. i ~What is to be the end of the application of this rule, this new rule adopted by the court? A tax is laid by the General Government against all money on hand or on deposit upon every citizen of the country at a given rate. ‘When laid, a few persons come before the court and say: My deposits were derived from the ‘proceeds of farm nroduce. or from bonds and securities, and they are not therefore taxable by this law.”* In my judgment the principle announced in this decision practically destroyed the power of the Government to reach incomes. There is no real difference between changing the exist- ence of the power to tax incomes from real and versonal estates and attaching such condi- tions and requirements to its exercise as will render it impossible or incapable of any prac- tical operation. You might just as well strike at the power to reach incomes from the sources indicated as to attach these conditions of apportionment which no Legislature can undertake to adopt, and which can be forced with no aegree of equality in taxation, but the further principle that the imposition of taxes, the burdens, should be imposed upon those having the most ability to bear them. This decision works out a directly opposite result in relieving the citizens having the greater ability, while the burdens of taxation are made to fall most heavily and oppressively upon those having the least ability. Con- sidered in all its bearings the dectsion is the most disastrous blow ever struck at the consti- tutional power of Congress. It strikes down an important portion of the most vital, essential power of government, in practically excluding any recourse to incomes from real and personal estates for the purpose of raising needed rev- enue to meet the Government’s wants and necessities under any circumstances. BROWN AND WHITE. They Declare the Decision a Practical Surrender to the Money Classe: WASHINGTON, D. C., May 20.—Justice Brown in his dissent said: If the question what is and what is not a direct tax were now for the first time pre- sented, I should entertain a grave doubt whether, in view of the definition of a direct tax given by the courts and writers of political economy during the present century, it ought not to be held to apply not only to an income tax, but to every tax the burden of which is borne immediately and ultimately by the person paying it. Iregard it as very clear that the clause requiring direct taxation be apportioned as to the population has not application to taxes which are not capable of apportionment according to population. It could not be supposed that the constitution could have contemplated & practical inhibition upon the power of Congress to tax in some way all taxable property within the jurisdic- tion of the Federal Government for the purpose of a national revenue, Justice Brown said in conclusion: Respect for the constitution will not be in- spired by a narrow and technical construction which shall limit the necessary powers of Congress. The decision involves nothing less than the surrender of the taxing power to the money class. While I have no doubt that Congress will find some means of surmounting the present crisis, my fear is that in some moment of national peril this decision will rise up to frustrate its will and paralyze itsarm. I hope it may not prove the first step toward sub- mergence of the liberties of the people ina sordid despotism of wealth. Justice White stated his views briefly. From first to last, he said, the opinion of the majority was but a series of contra- dictory propositions, one eating up and destroying the other. Speaking of the grounds upon which he dissented, Mr. White laid great stress on the Hylton case, and re-enunciated the legal points he had made in his first decision in the case. In conclusion he said: The injustice of the conclusion points to the error of adopting it. Ittakes invested wealth and reads it into the constitution as a favored and protected class of property, whilst it leaves the occupation of the minister, the doctor, the professor, the lawyer, the inventor, the author, the merchant and all the various forms of human activity upon which the prosperity of a people must depend subject to taxation with- out apportionment. The absolute inequality and injustice of tax- ing by reference to population and without re- gard to the amount of the wealth taxed is so manifest that to admit the power to tax and limit to this mode substantially denies the power itself, since it imposes a restriction which renders its exercise practically impossi- ble. A few extemporaneous remarks were made by Justice White after the reading of his written opinion. He spoke of the decision as a blow struck at the American eople, and said the power of levying an income tax now left could only be exercised with such injustice that no legislative body would dare attempt to exercise it, for such an attempt would bring forward a bloody revolution. STOPS THE COLLECTION. Commissioner Miller Notifies Agents That Theilr Work Is Now at an End. WASHINGTON, D. C., May 20.—Com- missioner Miller of the Internal Revenue Bureau to-day sent this telegram to col- lectors of internal revenue: Income tax law declared unconstitutional by the Supreme Court. Stop all work in connec- tion therewith and send to this office at once, under seal, all books, assessment lists, returns and records in your office or handsof deputies relating to income tax. The Commissioner’s opinion is $35,000,000 or $40,000,000 would have been collected dur- ing the first year from incomes had the entire law been sustained by the court, and even after it had been shorn of the rent provision at least $15,000,000, and probably $20.000,000, he estimated, could have been collected. As soon as possible those persons who have already paid their tax will be notified that under the authority granted the Commissioner by section 3229 of the revised statutes he will refund all such moneys on application of the payees. Although to-day’s decision of the court will naturally cut down the anticipated revenues of the Government, it is not thought that it will necessitate an extra session of Congress, unless some unlooked-for contingency arises. It is known that the administration does not regard an extra session s necessary, although the revenues during the last month have not been at all satisfactory. The customs receipts are surprisingly slow. The deficit for the fiscal year on January 31, 1895, was $34,246,386. On February 28 this had been increased to nearly $38,000,000 and on April 30 to about $45,250,000. The deficit, as stated to-day, was §51,043,584. CLEVELAND QUSTS MEADE The Order Retiring the Admiral Accompanied by a Rebuke. Regrets That a Brilllant Career Should Be Tarnished by Dis~ graceful Conduct. WASHINGTON, D. C., May 20.—The President has signed an order directing Admiral Meade to be retired. Admiral Meade’s application for retire- ment was made to the Secretary of the Navy on May 9, and by him forwarded to the President, who to-day returned it to the Navy Department with this indorse- ment: The within recommendation is approved, and Rear-Admiral Richard W. Meade is hereby retired from active service in the navy, pur- suant to Section 1433 of the Revised Statutes. The President regrets exceedingly that the long active service of this officer, so brilliant in its early stages, and so often marked by honorable incidents, should at its close, be tarnished by conduct at variance with his com- mendable career and inconsistent with the ex- ample which an officer of his high rank should furnish of submission to restraints and of a ‘wholesome discipline and manifest propriety. Grover CLEvZLAND. FREEDOM FOR CUBA, The Island Patriots to Declare Their In- dependence CONFIDENT OF VICTORY. General Gomez Says the In- surgents Are Certain of Final Triumph. FEED BUT A SMALL ARMY. Spaln, on the Other Hand, Must Malintain a Large Force in the Field. NEW YORK, N. Y., May 20.—Advices at the Cuban revolutionary headquarters in New York state that Gomez has in- structed all insurgent bands of 100 men and upward to send a delegate to the general assembly, which will meet at Yara in June, to put into execution the declaration of independence and form a definite provisional government. The Cuban chiefs have great hopes that the United States Government will recog- nize them as belligerents at the next session at Washingtor GOMEZ 18 \CONFIDENT. Spain, He Declares, Must Eventually Give Up the Fight. NEW YORK, N.Y., May 20.—A special to the Herald from Hoguin, Cuba, says: General Gomez of the Cuban armies, who passed near this place, escorted by a cavalry force of 1200 men, on his way to Puerto Principe, has sent a letter to the Herald, of which the following is a trans- lation: “Magnanimity will mark this war,as well as untiring energy. Among the veterans of the previous struggle flocking to my standard to guide the rank and file of the younger generation of patriots of liberty to sure victory there is noticeable a spirit of determination and” an energy far superior to anything displayed during our last war, and entirely free from certain objectiona- ble features which then tended to localize our movements and prevent rapidity of operations. ‘‘The outlook for the success of the pres- ent revolution before two years is so bright that there can be no doubt that the Repub- lic of Cuba will be one of the new States soon to occupy its place among the free Governments of the New World. “‘Martinez Campos has by force of cir- cumstances been compelled to accept the only plan of campaign left to him to en- able Spain temporarily to maintain pos- session of the larger towns and principal coast ports, and these will soon slip from her sickly grasp. Campos will require a double army—one of occupation and one for operation. For the first one he must have, as any military expert knows, the strength of the revo- lution, and one possessing a knowledge of the geography of the island may see at a glance that at least 30,000 men must be had in order to occupy and deferd the cities, towns and strategic outposts already threatened by the revolution. For his army of operation as many more troops will be required to enable him to face our forces in the field. “From physical and financial exhaus tion Spain will be compelled, as she was in Santo Domingo, to give up the fight. Free Cuba will not need such a large mili- tary force, for with our superior knowledge of the island, we can with one and the same army, of much less strength numer- ically, assisted as we are by these advan- tages and by all the naturat resources of the island, compel the Spanish army of occupation to keep strictly with the army of operation, harassing the enemy upon every hand by our alternate movements of sudden dissemination and quick concen- tration. Maxmvo Gomez.” AN OFFICIAL UKASE., American Correspondents Warned Not to Visit the Rebel Camps. HAVANA, Cusa, May 20.—The Spanish authorities, in view of the visits recently paid by the correspondents of American newspapers to the camps of the insurgents, have issued orders prohibiting them from making such excursions in the future, un- der penalty of severe punishment. Railroad communication with San Luis has been restored, but the inhabitants of that town and of Cristo have become so alarmed at the progress of the insurgents that they are flocking into Santiago de Cuba. The band of insurgents commanded by Felix Ruens recently attacked the village of Sabala, near Baracoa, and pillaged the stores. Maceo is understood to have planned to make a diverson in the vicinity of Santiago de Cuba in order to draw the attention of the authorities of that neigh- borhood and allow the rebel bands to pass Camaguey and El Cid. WON IN THE FIRST ROUND Pugilist Maher an Easy Winner in the Fight With Marshall. The Irish Boy Knocks Down His Opponent Five Times in Less Than a Minute. CONEY ISLAND, N. Y., May 20.—The bouts to-night at the Sea Beach Palace were witnessed by a big crowd. Champion Corbett was among the spectators. The first bout on the programme was a ten-round contest at 110 pounds between \Maxey Haugh of Brooklyn and Dolly Lyons of New York. Lyons the winner. The second bout brought out Joe Dunfee of Syracuse and Dan Creedon of Australia for twelve rounds at 160 pounds. Creedon won. : The Marshall-Maher fight was next in order. It was announced that Paddy Ryan would. challenge the winner. Mar- shall was extremely fat. Maher went at him like a cyclone and rained right and lefth and blows on his head and jaw. The Briton went to his knees four times, and then went down and rolled over on his back. Referee Eckardt saved him from a knockout by stopping the bout in the first round at the end of forty-five sec onds, declaring Maher the winner. L e The referee declared Arrested for Forgery. EAU CLAIRE, Wis, May 20.—A war- rant was issued to-night on complaint of . the Chippewa Valley bank for James M. Dulaney, Mayor of Rice Lake, charging him with passing!a forged note on the bank for $6000, signed by his father, W. H. Dulaney, a well-known lumberman of Hannibal, Mo. Mayor Dulaney was brought here under arrest. e R e e AMERICAN BORSES IN BERLIN, Michael Dwyer to Enter a String of Kentucky Thoroughbreds. NEW YORK, May 20.—A special to the Herald from Berlin says Michael F. Dwyer, the turfman, bas bought in America the horses Bonnie Bell and Yantar from the ‘Woodbury Farm, Lexington, Ky., and in- tended to start them in the trotting races in Berlin, and also in the races at the com- ing trotting meeting in Munich under the patronage of Prince Arnulph of Bavaria. The good sport and large crowds at the trotting races here attest the rapid growth of trotting in Germany, and surprise is ex~ pressed that there are not more American horses here to take part in the contests, e Can Collect the Insurance. ST. LOUIS, Mo., May 20.—Judge Priest to-day gave Minnie Robinson a judgment for $5375 16 against the United States Mn- tual Accident Assoctation. This estab- lishes the proposition that a woman who is engaged to marry a man has an insurae ble interest in his life. T Condition of the Treaswry. WASHINGTON, D. C., May 20.—To- day’s statement of the condition of the treasury shows: Available cash balance, $182,549,900; gold reserve, $97, FOLSOM-STREET PARADE, What Bicycle Clubs Are Expected to Participate in the Proces- sion. The preparations for the grand bicycle parade on Folsom street to-morrow evene ing were fairly completed yesterday. “It should be understood,” says Chair- man Wynne, “that the invitation to par ticipate in the parade is a sweeping one and includes every man, woman and child having a wheel, whether belonging to a clubor not. We want to make it a greatr event.”” Electric lights were placed on the crossings _on Folsom street yesterd Many residences are to be decorated with Japanese lanterns. The grand marshal will be Captain Charles Johnson of the Imperial Club, and H.F. Wynne of the California Cycling Club will be chief aid. The question of appointing aids has been easily disposed- of by making the captains of all the bi- cycle organizations aids in one general order. The procession will form at Twenty-first and Capp streets and move down Capp te Twenty-second, down Twenty-second to Shotwell, Shotwell to Twenty-first, down Twenty-first to Folsom, out Folsom to | Twenty-sixth, countermarch to Nine- teenth, countermarch to Twenty-first, up Twenty-first to Capp and disband. The following bicycle organizations will participate and in about the order named: Imperial Cycling Club, Olympic Club Wheelmen, Bay City Wheelmen, Califor- nia_Cycling Club, Y. M. C. A.’ Cycling Club, Pathfinders’ Cycling Club, Libert; Cycling Club, Crescent Cycling Club, Cali- fornia_Camera Cyclists,” Golden G cling Club, Royal Cycling Club, Pacific Cy- cling Club, Outing Road Club, Knocka- bouts and Eintracht Cycling Club. OHARLES PIERS SHOT. Ex-Officer Dalton Turns His Loose in a Saloon. Charles Piers of 715 Howard street, em- ployed by W. & J Sloare Furniture Com- pany, 641 Market sireet, was shot shortly after midnight, in the saloon of John Kelley, 715} Howard street, by John Dal- ton, an ex-police officer and until recently driver of the Southern Police Station pa- trol wagon. The trouble between the men is said to have arisen over a woman. They got into a dispute, but before they came to blows Kelley jumped between the two men, but Dalton “fired over his shoulder, claiming self-defense. The bullet entered Piers’ nose and lodged under the eyelid. He was taken to the Receiving Hospital, where Dr. Pecht ex- tracted the lead. Dalton was arrested and booked at the Central Station on a charge of assault to murder. Piers s a crivple, having lost all the fin- ers of his right hand a short time ago. is wound is not considered dangerous. eet Pistol DIED. KUHN—In this city, May 20, 1895, W. F. Hem Kuhn, beloved son of Henry and Anna Kang, and brother of Mrs. B. Taylor and Emma and the late Fred Kuhn, a native of San Francisco, aged 21 years 6 months and 15 da: 7 RETAIL PROFITS | On Clothing are sim- ; ply enormous. They are sold by the Manu- facturer to the Whole- saler—by the latter to the Retailer, who in turn sells to the con- sumer—thus making the purchaser pay & distinet profits. We are and have been for the past 15 years manufacturers of clothing at 594 Broadway and 127 Crosby street, New York. In order to avoid all loss with dealers in general we find it more profitable to sell to the consumer direct. We guarantee you savings of fully 40 to 50 per cent and have no hesitancy in saying that ours is the place where your dol- lar has the greatest purchasing power. HYAMS, PAUSON & CO, 34, 36, 38 and 40 Kearny Street, ——AND—— 25 and 27 Sansome Strest.