Congressional Record Quotes
The following quotes are from the summer of 1909 and are the income tax debates taken from the Congressional Record. The evidence shows the legislative intent and the understanding of the people as to the purpose of the proposed income tax. That purpose being that only net income from personal property or net income from real property was to be taxed by the authority of the amendment. Wages and salaries were by design, outside the scope of the 16th Amendment16th Amendment.
Mr. BAILEYBAILEY. But knowing, as we all do know, that it is necessary for the Government to raise a vast sum of money to support its administration, my judgement is that a large part of that money ought to be raised from the abundant incomes of prosperous people rather that from the backs and appetites of people who, when doing their best, do none too well. 44 Cong. Rec.1351 (1909).
Mr. BACON. I do not propose now to enter during the debate of the details, but I wanted to bring the attention of the Senator from Iowa to the fact that, with some of us a least , the common ground upon which we base the advocacy of an income-tax law is not that there shall be an increase of revenue, as was suggested by the Senator from Rhode Island in his speech on Monday, but that even if there should be no increase of revenue it may be so readjusted through the enactment of an income-tax law that a large part of the burden of the revenue may fall where it does not now rest, upon the wealth of the country, and that it may be taken off where it now rests in such an intolerable burden, from the masses of the people, destroying their efforts to secure a comfortable living for themselves and their families. 44 Cong. Rec. 1429 (1909).
Mr. BACONBACONBACON. I confess that when the Senator from Iowa rose in his place this morning to advocate an income tax, I expected to hear a most instructive and, to me, a most gratifying disquisition upon the suggestion that the income tax was one which should be laid and which should have its greatest foundation in the great necessity to shift the burden of taxation from the shoulders of the ordinary consumers, those who are so little able to bear it, and should rest it in part, at least, so far as the machinery and the constitutional power of this Government may permit, upon the shoulders of those who have the great wealth of the country and who, under our peculiar system of government, bear no appreciable part in the support of the Government resting upon consumers and being almost per capita, regardless of the wealth and ability of the respective citizens to bear each his part.
Therefore, I desired to ask the Senator from Iowa whether of not, in his judgment, the ground for the imposition of the income tax in this particular juncture was rested upon the necessity for an additional revenue, or whether it was rested upon the importance of shifting the burden of taxation from the great masses of consumers, so far as we may be able to do it, to rest it in part, at least, upon the shoulders of those who have the wealth of the country. I wanted to know which, in the opinion of the Senator from Iowa, is the more important consideration, he having given his entire time to the one and having entirely omitted the other. 44 Cong. Rec. 1429 (1909).
Mr. BROWNBROWN. It is the theory of the friends of the income-tax proposition that property should be taxed and not individuals. I do not believe the fathers ever contemplated that income taxes must be apportioned according to population, but the courts have said that they did. I am here to-day presenting an amendment to the Constitution which will compel the courts to announce the contrary doctrine. 44 Cong. Rec. 1570 (1909).
Mr. BORAHBORAHBORAH (Quoting from the biography of John Sherman).
While the expenses of the National Government are largely caused by the protection of property, it is but right to require property to contribute to their payment. It will not do to say that each person consumes in proportion to his means. That is not true. Everyone can see that the consumption of the rich does not bear the same relation to the consumption of the poor that the income of the one does to the wages of the other * * * As wealth accumulates this injustice in the fundamental basis of our system will be felt and forced upon the attention of Congress. 44 Cong. Rec. 1680 (1909).
Mr. BORAHBORAHBORAH. But if it be true that we must continue to do so, upon what basis and upon what theory can men say that the whole burden should rest upon the men who pay practically as much when worth $500 as the man who is worth $500,000,000? Take a part of the burdens off the backs and appetites of men and put it upon the purses of those who will never miss it, those who enjoy the pomp and circumstances of glorious war—without the war. 44 Cong. Rec. 1683 (1909).
Mr. BAILEYBAILEY. Although it is not pertinent to this discussion, I have no hesitation in declaring that a tax on any useful occupation can not be defended in any forum of conscience or of common sense. To tax a man for trying to make a living for his family is such a patent and gross in justice that it should deter any legislature from perpetrating it.
I do not hesitate to say that every occupation tax in America ought to be repealed, because it is a tribute exacted by sovereignty from a man because of his effort to make a living for himself and his family. I do, however, heartily subscribe to the tax upon corporate franchises, because they are the creations of the State and often possess a tremendous value. A franchise of any corporation is valuable. If it were not, the incorporators would not seek it. The value of many has never yet been measured in dollars. Therefore, when the State creates a corporation and endows it with faculties that are so valuable, it should be taxed. 44 Cong. Rec.1702 (1909).
Mr. BAILEYBAILEY. The rights protected by the Federal Government are as essential. And I might also say as sacred, as those protected by the States. If the States lay the cost of the protection which they afford upon the property of men, why should not the Federal Government do likewise? Why is it more just to compel men to contribute according to their wealth to support the state administration than it is to compel them to support the federal administration?
I go further than the Senator from Idaho has gone. I believe not that wealth ought to supplement the tax which consumption pays, but I believe wealth ought to bear it all. I think it is a monstrous injustice for the law to compel any man to wear a suit of clothes and then tax him for buying it. I think it is not right, when God made us hungry, and in obedience to His law we are compelled to appease our appetite, to charge us because we must keep could and body together by taking food. I believe that the Government ought no more to tax a man on what he is compelled to eat and wear than it ought to tax him on the water he drinks or upon the air he breathes. I believe that all taxes ought to be laid on property and none of it should be laid upon consumption.
Mr. President, there is one addition to the property tax that I would make. I would compel a man whose earning power from brain exercised in one of the professions or from inventive genius is great to pay on his income beyond a certain point. When a lawyer like the Senator from New York can earn at the bar, of which I am glad to say he is the honored head, $150,000 every year, I think he ought to be made to pay the Government a tax on that earning power, because in taking from him the small tribute which the law exacts we subtract no comfort from his home. I believe that any man in law or medicine or any other employment in life who exhibits an earning capacity far beyond the necessities of his home ought to be compelled to pay the Government which protects him in the exercise of his talents and in the accumulation of this wealth. He ought to be willing to pay, and I am willing that he should be made to pay. But save and except only this earning capacity of talent or of genius, I would lay every dollar’s worth of the Government tax upon the property of men and not upon the wants of men.
None of us, except the simple Democrat of the old-fashioned school, have all we want, but many of us have all we need. After we have satisfied our needs, then the Government has a right to take its toll. 44 Cong. Rec. 1702 (1909).
Mr. BAILEYBAILEY. If the Senator from Rhode Island will go back to the earlier and the better, the simpler, and happier days of this Republic and retrench these expenses, I will agree to withdraw the income-tax proposition. In other words, if he will lift the burden under which the toiling and consuming masses are stooping to-today, I will not quarrel with him about how he lifts it. I protest against the injustice which lays upon the people who toil, and who toil, thank God, without much complaint, this enormous burden of a billion dollars every year. 44 Cong. Rec. 2334 (1909).
Mr. BAILEYBAILEY. I not only would make it better in that I would make the duties lower, but I would make it better still in that I would lift from the backs and the appetites of the toiling millions of this Republic and lay a large part of the burden of this Government upon the incomes of those who could pay the tax without the subtraction of a single comfort from their homes. 44 Cong. Rec. 2455 (1909).
Mr. BAILEYBAILEY. Gentlemen, go ask them; put it to them. Do you believe they are truthful men? Ask them how the vote would stand, and they will answer you as I now declare, that nine men out of every ten believe this is a wise and a just and an equal system of taxation. If it is, you may postpone it, but that is all you can do. You can not ultimately defeat it. You have no chance to reduce the expenditures of the Government, and therefore your only chance to meet these enormous and increasing expenditures is to lay a part of the burden upon the incomes of the rich. 44 Cong. Rec. 2455 (1909).
Mr. CUMMINSCUMMINSCUMMINS. The issue, Senators, is plain and simple. I do not intend to hide behind any technicalities. I do not intend to be disturbed by mere names. I intend, if I can, to penetrate to the very heart of the thing; and I want to begin what I have to say by making it clear that the income-tax amendment proposed by the Senator from Texas [Mr. BAILEY] and myself rests as a burden only upon those natural and artificial persons with incomes of more than $5,000; but the income tax presented by the Finance Committee, and explained so clearly by the Senator from California [Mr. FLINTFLINT], rests upon the incomes of all the stockholders of our corporations, whether such stockholders be rich or poor, with little or great incomes, and upon many members of insurance companies, without regard to their ability to bear these additional burdens.
....This tax proposed by the committee is not fair; it is not equal; it does not distribute the burdens of government as they ought to be distributed; it does not put upon the shoulders of those who can best bear the weight of this great structure; but, without any regard to ability to pay or bear, it puts the burden on a certain class of men, namely, those who have invested their capitol in the stock of corporations. 44 Cong. Rec. 3955 (1909).
Mr. CUMMINSCUMMINSCUMMINS. Senators, I can not conceive how there can be objections to the justice of an income-tax law. It places the burdens where they belong; it discards unproductive property and unprofitable labor, and exacts but a small percentage of gains and profits and earning actually received. It is impossible to conceive of any injustice in taking a little part of a surplus in hand over and above a most liberal allowance for the maintenance of a family. It exacts not a penny that is in fact needed for either the necessities, the comforts, or the luxuries of life. 44 Cong. Rec. 3969 (1909).
Mr. CUMMINSCUMMINSCUMMINS. It is, with this difference: In the amendment I propose if the total income of the shareholder does not reach $5,000, he is then not taxed. It preserves the central, fundamental idea of an income tax. In the case proposed by the committee, if a poor devil has 1 share of stock in a corporation, and it is all the income he has, he is nevertheless taxed. My desire is to relieve the incomes of men to the extend necessary to maintain their families, to support and educate their children, because I believe that they owe a higher duty to their families than they owe to the Government. 44 Cong. Rec. 3975 (1909).
Mr. BORAHBORAH. In the first place, I do not claim that an income tax is a panacea for all the evils that afflict the race. I do not claim that it will adjust all the iniquities of taxation. I only claim that it will reach that class of wealth which to-day does not in my judgment pay its proportion of taxation, and will reach that class of wealth which can not shift the tax to the consumer. 44 Cong. Rec. 3997 (1909).
Mr. BAILEY. I believe that in earning an income by personal service every man consumes a part of his principal, and that fact ought always to be taken into consideration. The man who has his fortune invested in securities may find in a hundred years, if he spent his income, that fortune still intact, but the lawyer or the physician or the man engaged in other personal employment is spending his principal in earning his income. That fact ought under every just system of income taxation to be recognized and provided against. 44 Cong. Rec. 4007 (1909).
Mr. NEWLANDS. Our legislation, both with reference to revenue and publicity, should be concentrated upon those forms of wealth that have become most oppressive and upon those forms of wealth with reference to which the greatest abuses have existed; those forms of lawless wealth that have brought the law-abiding wealth of the country itself into discredit. There will be no difficulty in raising ample revenue from such sources. 44 Cong. Rec. 4048 (1909).