DECEMBER 7, 1950
NEW YORK, Wednesday—Now that the House has passed an excess-profits tax, leaving the final measure up to the Senate, Secretary of the Treasury Snyder is now suggesting controls on wages and prices. If we control wages and prices, I feel it is essential that we control all profits so that there is no question of unfairness in the distribution of the burden that this country must face.
The one argument that is valid against the control of profits, and incidentally against an excess-profits tax, is that we take away from people that incentive which really encourages them to start new businesses or invest in new developments. I have always thought this might very well be met by exempting from all taxation what might be called "risk capital"—that is to say, money put into enterprises that are new and untried. If such enterprises succeed they create work or provide the way to produce something that is really needed. If they fail, the capital is lost.
Those who take these risks should be given some consideration, if the government wishes to encourage new business or expansion of businesses, or even new inventions. At the present time, it is probable that the government is not anxious to encourage new enterprises because so many men are needed in the Army and for increased production in established businesses for defense purposes. We shall have hardly enough manpower to go around, even if we use handicapped people and women and older people again.
It seems to me, however, that this objection to the excess-profits tax could be overcome by some incentive along the lines that I have suggested when the time comes that new jobs are needed. In any case, for the time being, we know that we must all submit to a certain amount of regimentation. The difference to us, however, is that we do it of our own free will. The only thing I think we should be careful to insist on is that the burden should be equally distributed.
In our great concern for our own men in Korea these days we must not forget that the Koreans themselves, whether they are North or South Koreans, are the only people who are probably suffering more from the present invasion by the Chinese Communists than we are. They have nothing with which to replace their great material losses, and there must be a very great loss of life among their civilian population as well as among their troops.
It seems almost unbelievable that we were wondering about a United Nations mission to plan rehabilitation in Korea such a short time ago, and now we are wondering whether we can get some of our men safely out of the country. The thought of rehabilitation is far away. Why the Chinese Communists wanted to bring about this wanton destruction is hard for us to understand. But those who have talked to the delegates here tell me that their line is a completely communist line and they evidently believe everything that the Soviet Union has been saying about the United States' desire for power and for war. Soon we will know the worst and perhaps also the best. If we can keep our friends and accept this setback, just as we accepted Pearl Harbor, we will win in the long run the peaceful world we have always wanted to achieve.