JANUARY 31, 1948
HYDE PARK, Friday—In spite of all protests from Democrats, the Republicans in the House are putting through their particular tax-cut bill.
From the table released by Rep. Harold Knutson, sponsor of the bill, it would look as though, on a percentage basis, the low-income groups would get the greatest reduction. For instance, under the present law a married couple with two children pay $76 on a $2,400 income. Under the new bill they would pay nothing, so their percentage of reduction would be 100 percent. A married couple with two children and an income of $100,000 now pay $62,301. Under the new bill, they would pay $44,224. This is a 29 percent reduction.
However, with inflation the way it is at present and with prices of food so high, the $76 saved on the $2,400 income would be swallowed up without the family noticing the difference. On the other hand, the family with the $100,000 income always was able to pay for the necessities even at inflation prices, and their tax reduction would mean they could have a good many added luxuries.
If, coupled with this reduction, there was a real program for stopping inflation and a global view of what is needed abroad—not a niggardly effort to try to get by as cheaply as possible, without regard to the ultimate effect on recovery in European countries—then I would feel some confidence in the long-range fiscal policies of the Republican Party. But looking at it cold-bloodedly under present circumstances, I have no confidence that this tax reform has been studied with a wide comprehensive view of the whole economic situation before us today. It does not, therefore, give me much confidence in the present Congress.
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There is one great advantage in having the executive branch of the government controlled by one political party while the legislative branch is controlled by the other. It puts clear-cut responsibility on both parties. The executive branch is responsible for the measures it proposes, but the legislative branch clearly carries the responsibility for the measures it passes or rejects. Therefore, in a time like this, one is able to assess responsibility more truly than at any other time.
While the Republican Party may think that the country is not watching them, that is an unwise supposition. They may think there is not enough intelligence among the people to watch the results of this division of powers, or to know what each branch of the Government stands for, and then to decide where the best chance lies for greater consideration of the real needs of the people, both at home and abroad. Time alone can give the answer.
Two things now affect the people of this country very deeply—the talk of possible war and the reality of inflation.