AUGUST 3, 1959
HYDE PARK—The whole country is undoubtedly interested in the new plan proposed by the House Ways and Means Committee for financing road building throughout the nation.
The President had suggested that the gasoline tax be raised 1½ cents a gallon. This would have continued the pay-as-you-go policy on road-building that has been in force in the past. Under the new program, a billion-dollar bond issue would be authorized.
The immediate allocation of Federal highway funds to the states will be sharply cut and will continue to be cut for several years. This probably will mean reconsideration of plans for road-building and road repairs in every state.
The President, in advocating a rise in this particular tax, was, of course, not thinking of having to run for office himself. The Congress, which faces the voters in the next election, quite naturally is reluctant to impose something which they know will touch not only the people who own cars but all of their friends and will certainly not be popular.
The natural hope of a Congressman is that, in getting a bond issue, the public will not realize it is paying the same tax in the form of interest on the bond issue, and this must come out of general taxation. It perhaps will not be as direct as a gasoline tax, but in the end it will come out of consumers' pocketbooks.
Most of us are both consumers and producers, but those who produce are more conscious than consumers of the ways in which they are taxed. The politician who studies his constituents carefully knows that a concealed tax is less apt to bring him unpopularity than a direct one, which is in the consumer's mind every time he pays it.
I sometimes wonder whether anyone really stops to think about the strange situation we are in at the moment. Everyone tells us that this is a most prosperous period. Yet, this Administration had a deficit of $12 billion in the last fiscal year, which is bigger than any peacetime deficit in a very long time.
The steel strike may bring us all to some realization of our financial situation, and perhaps that is why the President is putting considerable pressure on trying to have it settled. But since we do very little serious thinking until we are in a real crisis, perhaps the steel strike will make us face up to the fact that this is a rather false prosperity.
Last week the Encampment for Citizenship, which is run every year at the Ethical Culture School in Riverdale, N.Y., came to Hyde Park for its annual picnic.
It is always a pleasure to have this group. Twenty-six states are represented this year, and a number of people came from foreign countries, among them a delegation of Nigerians which had been given some intensive briefing toward understanding the efforts to teach democracy during the six weeks of the encampment.
The young people always seem to me to be particularly intelligent and full of interest. They are chosen, I think, in their various states for their leadership qualities, and their questions show a great deal of thoughtful interest in both national and international situations.