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National Debt Information (Background material only), 1958?
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National Debt Information (Background material only), 1958?
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The original documents are located in Box D15, folder "National Debt Information
(Background material only), 1958?" of the Ford Congressional Papers: Press Secretary and
Speech File at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. The Council donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box D15 of The Ford Congressional Papers: Press Secretary and Speech File at the Gerald R. Ford Presidential Library
Support
"all"
Domestic Freyn
1955) 84th
91/9
90/10
93/7
1956
1957
73/23
69/31
87/0
1958
76/24
73/17
89/11
85 the Congress
75/24
71/29
88/4
Bi- Partison
1955
84th
(
86/12
1956
1957-
I
83/12
1958
Party -
1954 - 93%
1955 - 68%
FORD & LIBRARY GERALD
NATIONAL DEBT STORY
Jan. 20, 1953
Debt anbject to huntata
$267.3 billion
Gen. Fund Cash
4.6 "
Net
$262.7 "
June 30, 1958
Debt
$276.0 billion + 6
Gen. "und Cash
9.7 "
Net
$266.3 "
Gross debt increase under Ike
8.6 = or 3 percent
Increase in cash fund from Jan. 20, 1953
to June 30, 1958
5.1 =
Net increase in debt under Ike
3.5 =
or 1.3+ percent
Increase under Truman $33,132,564,658 or 16 percent
"
" FDR $213,204,904,122 or 1,014 percent
FORD & LIBRARY GERALD
Fiscal Year
Expenditure
Deficit/Surplus
1953
$74,274 million
D-$9,449 million
Truman udget
1954
67,772 If
D-$3,117 "
Truman recomm.
1955
64,570 If
D-$4,180 "
Tax reduction
program
1956
66,540 "
S-$1,627 "
1957
69,433 "
S-$1,596 "
1958
not available
D-$3,000 " (more or less)
Debt as of June 30, 1958 stood at 276 billion.
General fund (cash) as of that date stood at $9,749 million
A year before(June 30, 1957) cash balance was $4,670 million
During year 1958 the Treasury built up a cash balance of about $5 billion,
which would indicate that the apparent $5 billion increase in the
debt during fiscal 1958 is off set by the $5 billion increase in the
cash balance during the same period
FORD i LIBRARY GERALD
National Deft as on date given
Billin
Jan 20, 1953
a 276.3 267.3
Jane 30, " "
265.5
Dec 31,
274.7
limit
June
30 1954
270.8
To aug 24. - 275B
the
By 28, 1954- $2818
31 "
278.3
June
30, 1955
273,9
Dec
30, "
280,3
1958 limit
June
30, 1956
272.4
July 1. '278B
Dec
31, 11
276.3
lynit
June
30, 1957
270.2
Jonly 1, 1957. 295B
Dec 31, 11
2.74.6
Feb 26,1858 wf t '280B
June
30, 1958
276.0
30, 1959
July
11, 11
275.4
GERALD 1893817 FORD
up under like
or 3 forcent
National Debt
From Mr. Treasury Thomas Walfe Code 184
X 2026
afent 12, 1945 (guaranted obligations
Liss left subjects to l
235.3 billin
Gen Fund Cash.
13.4
#32
Net left.
Jan 19, 1953 left.
267.3 bellin
Cash
$15.8
5.8
Net Deft.
Dec. 30, 1958
left.
283.0 billin
Cash
5.0
Net Debh
Girs dicrease usler Truman
Net
IL
11
1.
three Increase under the
BERALD B. FORD LIBRAP,
Net
IL
:
11
REPUBLICAN CONGRESSIONAL COMMITTEE
Washington, D. C.
The Growth of Federal Taxation
These charts show the tremendous growth of Federal taxation and
spending since 1913, when the present income tax system was started.
Here are figures that show graphically the habitual disposition of
Democrats to "tax and tax, spend and spend. 11
Here also is evident the results of repeated Republican efforts to
reduce Federal taxation, cut the costs of the National government, and shrink
the size of the Federal establishment.
The personal income tax in 1913 amounted to only 29 cents per capita.
Today it exceeds $200 for each man, woman and child in the United States.
All Federal taxation in 1913 was $7.06 per capita and today is
estimated at $435.
During that 44-year period, Democrats controlled Congress for 28
years and produced 22 years of deficits. The National Debt rose from
$1, 200, 000, 000 in 1913 to $277, 360, 000, 000 under Harry Truman.
In the 16 years of Republican stewardship in Congress, there were
14 years of surplus of income over expenditure, a surplus of more than
$19, 000, 000, 000. These proceeds were applied to reducing the National
Debt and for lowered Federal taxation.
Since World War II, Republican Congresses reduced the tax burden
by $4, 800, 000, 000 a year in 1948 and further $7, 400, 000, 000 a year in 1954.
This means a tax saving for the people of over $70, 000, 000, 000 since 1948.
It also should be noted that the first surplus in 5 years, totaling $1. 6
billion, was achieved in 1956. Expected surpluses in 1957 and 1958 will bring
the total to $5 billion for the three years. The 1953-54 deficits of $12, 500, 000, 000
were legacies inherited from the previous Democrat Administration.
Such conclusions and many more can be drawn from these charts by
following the simple instructions for reading the columns of figures.
Spendthrift activities under the Democrats were important factors in
producing:
1. Inflation in living costs and devaluation of the
dollar accompanied by the loss of more than half
of our personal savings since 1939.
2. A vast growth in Federal finances, the National
Debt, and governmental bureaucracy.
3. A loss of State and local financial responsibility.
To achieve the thrift and good management that will preserve American
civilization, a Republican Congress is a must in 1958 and thereafter.
&
FORD
Richard M. Simpson
GERALD
Thinking Ahead:
Can We Meet the Crisis?
By MALCOLM P. McNAIR
T
REPRINTED FROM
HARVARD BUSINESS REVIEW
JULY-AUGUST 1958
LERALD SALD ? FORD
Edited under the direction of the Faculty of
THE GRADUATE SCHOOL OF BUSINESS
HARVARD
ADMINISTRATION, HARVARD UNIVERSITY
BUSINESS REVIEW BOARD
STANLEY F. TEELE, DEAN, Ex Officio
NEIL H. BORDEN, Chairman
Business
VERNON R. ALDEN
STEPHEN H. FULLER
ROBERT W. AUSTIN
LINCOLN GORDON
JAMES R. BRIGHT
LEONARD C. R. LANGER
EDWARD C. BURSK
RALPH W. HIDY
J. KEITH BUTTERS
JOHN E. JEUCK
From In This Issue
E. RAYMOND COREY
ROBERT O. SCHLAIFER
Review
BERTRAND Fox
Ross G. WALKER
EDITOR
July August 1958
Vol. 36, No. 4
EDWARD C. BURSK
Malcolm P. McNair
Since there is a ring of Theo-
Associate Editor: JOHN F. CHAPMAN
dore Roosevelt in these words,
In Thinking Ahead Malcolm P.
Assistant Editor: DAVID W. EWING
ARTICLES
some readers may be surprised to
McNair deliberately paints a dark
Assistant Editor: DAN H. FENN, JR.
learn that the author is not a po-
Managing Editor: VIRGINIA B. FALES
Industrial Dynamics
37
picture of the demands that Soviet
litical spokesman but a marketing
imperialism is placing upon the
Advertising Director: JOHN NIMMO
A Major Breakthrough for Decision Makers
man. The recipient of many hon-
Industrial Programs: JACOB F. WEINTZ
Jay W. Forrester
United States and of the many
ors and awards, Mr. McNair is
Business Manager: T. K. WORTHINGTON
problems that our democracy to-
Lincoln Filene Professor of Re-
Circulation Director: ERNEST D. FRAWLEY
Working with Behavioral Scientists
67
day is not handling well. The
tailing at the Harvard Business
Circulation Manager: AGNES M. JORDAN
Joseph W. Newman
country needs to wake up, he
School, a well-known writer in
thinks, to the fact that it is at a
Address all communications, including manu-
How to Manage Improvement
75
the marketing field, and a Direc-
scripts and change of address, to Harvard
Leo B. Moore
critical turning point. "As indi-
tor of the Allied Stores Corpora-
viduals we shall have to change
Business Review, Soldiers Field, Boston 63,
tion, Indian Head Mills, Inc., and
Mass. Telephone: KIrkland 7-9800.
Does Automation Raise Skill Requirements?
85
our scale of values so that we do,
other organizations. He was a co-
James R. Bright
voluntarily and with a sense of
author of two prophetic HBR ar-
Reprints of all articles and features in this
mission,
such things as spend-
ticles during the Korean War pe-
issue, as well as most previous issues, are
Evaluation of Stock Dividends
99
ing more on defense, taxing our-
available. Information on request from Busi-
riod that measured the capacity
C. Austin Barker
selves more, working harder, sac-
ness Office at above address.
of the economy against the goals
Basic Research
rificing something from our stand-
of the defense effort: "Thinking
A Volume Index to the Review is published
115
ard of living, disciplining our-
Ahead: Our Economic Capac-
annually with the November-December issue.
Should Industry Do More of It?
selves more, curtailing special and
Albert E. Hickey, Jr.
ity to Meet Mobilization Needs"
The contents are currently indexed in The
costly benefits to privileged eco-
(January 1951) and "Thinking
Industrial Arts Index and in the Bulletin of
The Interpersonal Underworld
123
nomic groups, developing rigorous
Ahead: Our Economic Capacity
the Public Affairs Information Service.
William C. Schutz
standards and competitive excel-
to Meet Defense Goals" (January-
lence in education, and channel-
VE RI TAS
February 1952).
Businessmen's Stake in Regional Planning
136
ing our best brains into needful
Norton E. Long
activities for national survival."
- The Editors
FEATURES
Harvard Business Review is published bimonthly
by the Graduate School of Business Administra-
tion, Harvard University. Nathan M. Pusey,
In This Issue: Articles and Authors
9
President; Paul C. Cabot, Treasurer; David W.
The Editors
Bailey, Secretary.
$8.00 per year, $2.00 per copy - United
From the Thoughtful Businessman: Letters
17
States & Possessions, Canada.
Review Readers
$10.00 per year, $2.50 per copy - Pan-
American Postal Union.
Thinking Ahead: Can We Meet the Crisis?
25
$15.00 per year, $3.75 per copy - elsewhere.
Malcolm P. McNair
Make checks payable to the Harvard Business
Review.
Looking Around: What Can Business Games Do?
147
Entered as second-class matter at Boston, Mas-
G. R. Andlinger
sachusetts. Additional office of entry at Dayton,
Ohio.
Copyright, 1958, by the President and Fellows
The Harvard Business Review does not assume responsibility for
of Harvard College.
the points of view or opinions of its contributors. It does accept FORD
responsibility for giving them an opportunity to express such views
PRINTED IN U.S.A.
and opinions in its columns.
LIBRARY
tional and on-site ballistic missiles.
eign policy. Ignoring these things,
ably stupid to sit back in compla-
Accordingly, the 'alert' time avail-
what do we see?
cent contemplation of the alleged
able to get bombers in the air from
Certainly the Russians are out-
superiority of the American way
these bases has been reduced to a
stripping us in several branches
of life for producing a high stand-
couple of minutes.
By late
of science, particularly in the de-
ard of living and a well-rounded
1959 the Soviets could deploy
enough intercontinental ballistic
velopment of rocket fuels and the
cultural development.
missiles to neutralize the Strategic
guidance of missiles and satellites.
Furthermore, the notions that
Air Command's continental U. S.
They have confounded our ex-
sooner or later the Soviet dictator-
bases.
perts with their timetable of weap-
ship will fall apart of its own
"We do not now have an ade-
ons development, and now they
weight and inefficiency and that
quate means either of detecting
are beginning to make pronounced
it will be unable to provide its
or intercepting [the Soviet ICBM]
economic strides, pushing their av-
people with an acceptable stand-
missiles, and a workable missile de-
erage rate of industrial growth at
ard of living must also be aban-
Thinking Ahead
fense system is not expected to exist
a pace distinctly faster than ours.
doned. Russian achievement will
before 1962 at the earliest.
Let's not kid ourselves that the
not wane; rather, it will grow.
Our vulnerability to attack during
Russians are doing all this with
How can we successfully coun-
[1959-1962] is apparent."
1
mirrors, with clumsy imitations of
ter this Soviet drive for superiority
Western products, with captured
and ultimate triumph in military,
The second phase is the threat
German scientists, and with prop-
scientific, and economic achieve-
Since the middle of 1957 two events have shaken the
over the next six to ten years
aganda stories in Pravda. We had
ment?
complacency of our current American way of life. The
of the steady march of Russian
better wake up to the fact that
We ought to recognize that we
aggrandizement - piecemeal ag-
Sputniks, as a symbol and portent of the age of push-
behind all the things which we
cannot do it merely by spending
gression, infiltration, and missile
rightly detest there are a lot of
dollars; and yet, paradoxically, in
button annihilation, have gone part way toward destroying
blackmail - designed to accom-
people working hard and intelli-
the years just ahead we undoubt-
the notion that our free enterprise system will automati-
plish the complete isolation of our
nation and its eventual surrender.
gently. There are long hours of
edly must spend many more dol-
cally provide superiority in scientific achievement over the
effort, dedication to achievement
lars for defense purposes than we
Then, even if we can suc-
of objectives, and a tremendous
are now doing. As I see it, our
regimented efforts of the Soviet dictatorship. And now
cessfully counter these first two
desire on the part of individuals
defense expenditures must be ade-
the sharp decline in business and the swift rise of un-
phases of the Soviet threat, there
to excel. There is a will to suc-
quate for five purposes:
is the long drawn-out phase of
employment have raised doubts as to whether the business
ceed; there are rigorous standards
continuing cold war, which will
of performance. There is con-
(1) Today's weapons must pro-
cycle really has been tamed, as to how far our economy
increasingly become a race for
vide a deterrent to immediate at-
cern with getting jobs done rather
really is depression-proof.
economic and scientific suprem-
tack. Right now that means more
than with such things as inter-
acy. For the future of freedom
bombers, more crews, more bases.
service rivalries and preoccupa-
it may be just as dangerous for us
tion with human relations. And
(2) Tomorrow's weapons must be
to lose this race as for us to be
inevitably there must have been
far enough along to provide assur-
How can democracy meet the
menace of Russia's great suprem-
beaten in either of the earlier
ance that we shall have a deterrent
to 100 per cent of our strategic
the development of an adminis-
tomorrow.
crisis of our times? Theodore
acy in submarines and her grow-
forces through a surprise combina-
phases. If we do not begin to
trative and educational "elite" -
Roosevelt gave a hint to the an-
ing power in long-range bombers.
tion attack by submarine-launched
change our attitudes about the
leaders who have risen by merit.
(3) Basic research must be ade-
swer many years ago:
Too many people have not yet
missiles, long-range aircraft, and
underlying problems of national
This is a people who have made
quate to ensure that the day after
"Americanism means the virtues
accepted the basic reality of the
nuclear sabotage. For example, Dr.
safety and survival in the next
tomorrow's deterrent also will be
Ellis A. Johnson, head of the Op-
education a weapon.
two years, or even sooner, we are
effective.
of courage, honor, justice, truth, sin-
Soviet drive for world dominion.
We have been lulling ourselves
erations Analysis Office, Johns Hop-
In spite of the excitement about
not going to have much chance
cerity and hardihood - the virtues
kins University - which has been
the Sputniks, we have not yet
(4) In the meantime certain ci-
to sleep with the illusion that time
even though we forestall attack
vilian defense measures to ensure
that made America. The things that
conducting tactical and strategic
really waked up from our com-
is on our side, but time is not on
in the meantime.
will destroy America are prosper-
fortable dream. We are still loath
survival are important, especially
studies for the Army for ten years
psychologically.
ity-at-any-price, peace-at-any-price,
our side and is running out at a
- believes that a Russian attack
to surrender the notion that the
safety-first instead of duty-first, the
frightening rate.
would be more than adequate right
millions of centers of initiative
(5) We must be prepared (which
love of soft living and the get-rich-
There are three phases of the
now to destroy our ability to retali-
Let us look realistically at our
in a free country will automati-
we are not today) both physically
quick theory of life."
Soviet threat which vitally con-
ate effectively. Some military men
and psychologically to fight smaller
opponents and for the moment
cally provide superiority in all
cern all of us.
in the North American Air Defense
wars, wars of containment, with
The sudden appearance of the
ignore certain aspects which in-
lines of endeavor over a con-
Command are reported to share this
conventional weapons.
first Sputnik last October undeni-
The first phase is the very real
evitably color our thinking about
trolled dictatorship. On a broad
danger of attack within the next
opinion concerning the vulnerabil-
ably scared us, but in my opinion
ity of our strategic forces.
the USSR - the intrigue, knifing,
cultural front this concept might
This fifth purpose is especially
it did not scare us half enough.
two or three years. In comment-
ing on this crisis, J. Sterling Liv-
"Allen Dulles, Director of Cen-
and purges at the top; the cold
be true, but it is not automatically
important. I believe we have com-
We need a far greater sense of
ingston has pointed out:
tral Intelligence Agency, testified be-
brutality of control of conquered
true as against planned and con-
pletely failed to realize how a con-
urgency than exists today. It is
fore the Senate Preparedness Sub-
peoples so well demonstrated in
centrated effort channeled down
From a speech at the Ninth Annual
rather ironical that we panicked
"Some military experts
be-
committee that almost all American
Hungary; the nonsense of dialec-
particular lines. And when those
Midwest Regional Conference of the
about Sputnik I when up to that
lieve that the Russians already pos-
air bases in Europe and Africa are
tical materialism; the utterly un-
lines of endeavor threaten our
Harvard Business School Alumni Clubs;
see Harvard Business School Bulletin,
time we had virtually ignored the
sess the capability to destroy close
now within range of Soviet opera-
scrupulous and Machiavellian for-
national existence, it is immeasur-
June 1958, p. 8.
tinued stalemate in nuclear weap-
in particular by increasing éffi-
what government did to a lot of de-
Partly as a consequence of all
a serious disequilibrium which we
occupation with economic problems
fense contractors and subcontractors
this insidious nurture of intellectual
have so far failed to deal with.
ons (which we are anxiously try-
ciency through inducing labor to
on the domestic front could give
ing to achieve) frees Russia for
forego featherbedding practices.
in the economy drive of 1957 (a
flabbiness, our current younger gen-
(7) Obviously this disequilibrium
Russia a good opportunity to strike.
procedure, incidentally, which was
eration has no strong motivation to
a program of world conquest by
is part of the general business cycle
But more probable, in my opin-
By these means, I am convinced
piecemeal aggression, infiltration,
clearly one of the precipitating fac-
excel. In place of the goal of doing
problem, and here I apprehend that
ion, would be Soviet utilization of
that we could double our na-
and so on. This is a threat that
tional defense expenditures with-
tors in the present recession).
a good job we seem to have substi-
we shall shortly have to admit fail-
our economic difficulties to bore
tuted the goal of being a good guy.
ure to deal effectively with the prob-
from within, fomenting dissension
must be countered - unless the
out hurting ourselves economical-
Thus we in this country are no long-
lem of recurring booms and depres-
among our NATO allies, indulging
West is going to continue to
ly and without unbalancing the
Obviously, our democracy can
er producing in sufficient numbers
sions. During the latter part of the
in piecemeal aggression in various
retreat into surrender. Our di-
budget, except perhaps in short-
meet the Soviet drive for superi-
the necessary "elite" groups for
postwar period the demise of the
parts of the globe, endeavoring to
lemma is this: we have steadily
run periods. It all depends on
ority only if all 170 million of us
leadership. In the words of William
business cycle was announced with
pressure us into withdrawing from
claimed that we will not start a
our system of values. How much
as individuals are willing to work
Mentor Graham, the man who was
increasing frequency. It now be-
overseas bases, and so on. Our di-
nuclear war, but at present we
is national survival worth to us?
at it, only if we are prepared to
primarily responsible for the educa-
gins to appear that such reports
lemma today is that for the short run
have no other means of counter-
Harder work? Restraint in wage
tion of Abraham Lincoln, "Lazy
change some of our attitudes, to
were, to say the least, premature.
we cannot afford to have an eco-
ing piecemeal aggression.
demands? Perhaps even some of
minds make a dying nation."
alter some of our present values,
There is substantial evidence that
nomic depression in the United
the kinds of controls we previous-
(2) Another problem, closely re-
the current business downturn is
States, and for the long run we can-
to take a point of view a little
ly experienced in wartime? It will
longer than today or tomorrow,
lated to education, which we are
going well beyond the recessions of
not afford to patch up our economy
not be easy to make such sacri-
to forego the fast buck now and
obviously handling badly today is
either 1948-1949 or 1953-1954.
with political shin plasters.
Unquestionably we should be
fices, but it will be far easier than
juvenile delinquency.
It is increasingly difficult to char-
(8) To add one more to our list
spending much more money for
then, and to recognize that free-
acterize this as a rolling readjust-
of failures, the world trade problem
all these defense purposes, prob-
coming out second in the race.
dom can be retained only if we
(3) The problem of desegrega-
ment. This time there are many
is certainly not approaching solu-
ably on the order of at least 50%
In emphasizing the need for
are quite literally willing to fight
tion is another of our failures.
of the classic signs of the old busi-
tion. This is becoming an increas-
to 75% more. Not only must we
greater defense expenditures I do
for it. Thus, increased defense
(4) We are bungling the task of
ness cycle - overexpansion of capi-
ingly critical matter, affecting rela-
spend more, but we undoubtedly
not want to associate myself with
spending is only the surface as-
agricultural readjustment too. The
tal goods, high debt levels, a severe
tions with the European econom-
can spend more if we will face
those who view increased govern-
pect. The real question is wheth-
enormous waste of taxpayers' money
cost squeeze on profits, high prices
ic community, relations with our
up to the true urgency of the sit-
ment spending (in proportion to
er we, as individual Americans,
in price supports increases rather
of finished goods in contrast to
NATO allies, and, indeed, our abil-
uation. For one thing, we can
the total gross national product)
have what it takes. Have we got
than reduces agricultural surpluses,
pronounced weakness in the world
ity to retain our foreign bases.
divert several billions of spending
with equanimity. I fully recog-
the guts to come through?
adds to the inflated cost of living,
price of raw materials, with serious
I have cited these instances of
from such wasteful nonessentials
nize legitimate reasons for in-
There are many problems that
bids fair to destroy the world mar-
repercussions on world trade and
creased government spending on
our democracy today is not han-
ket for our products, and in the case
exchange - all accompanied by a
the failure of our democracy to
as the farm subsidy program.
national defense and on necessary
of cotton, for instance, is gradually
distinct waning of boom psychology
deal effectively with critical prob-
Furthermore, we could take 5%
dling well. For example:
services which only government
throttling an entire industry of great
and a growth of business pessimism.
lems not from any utopian desire
out of present consumer spending
can provide - highways, airways,
(1) Our democracy's greatest fail-
importance to our national economy.
What this all adds up to is essen-
for perfection in the management
for goods and services by increased
ure today is in education. Here the
tially the consequence of too much
of human affairs but to emphasize
taxes on individuals, and with that
traffic control, and so on. But I
(5) Increasingly evident is our
still stick to the old concept that
indictment is becoming quite clear.
boom, of trying to do too many
We can see a sort of intellectual
failure to deal with the problem of
how seriously we are jeopardizing
$14 billion we could increase de-
things too fast, of trying to borrow
the future of our free institutions.
government should do only what
labor monopolies effectively. In the
fense spending by more than one-
Gresham's Law in operation in our
too much from the future.
public interest the monopoly power
We are fighting a determined,
third. During this present period,
is needful and what private enter-
schools. Free high school electives;
In spite of all our undeniable
of labor must be curbed, just as the
ruthless society which has a com-
when business expenditures for
prise cannot do, or what private
courses in social aptitudes and life
improvements in the business and
monopoly power of business enter-
pletely different set of values from
plant and equipment are falling
enterprise cannot do as well as
adjustment, cooking, love and mar-
financial structure since the 1930's,
prise has been curbed. Here again
those of our Western civilization.
off by some 13% from the high
government.
riage, first aid, automobile driving,
we apparently have not yet learned
we are making no progress. The un-
The reasons, to my mind, are
and so on; little or no homework;
how to keep business booms from
Many philosophers, political the-
level reached in 1957, the econ-
checked pressure of organized labor
getting out of hand, nor have we
orists, and students of govern-
omy could afford to divert some
very simple:
no competitive pressures; automat-
for wage advances is an important
ic promotion; grading on progress
learned how to time control meas-
ment from the early Greeks down
of that slack to defense spending.
(1) Lack of the pressure to make
ingredient of our present economic
rather than standards; and all the
ures. And, on the other side of the
to the present have expressed
Such shifts in consumer and in-
weakness. Unless suitable restraints
profits makes government more in-
rest of the claptrap of alleged mod-
coin, in seeking to check the down-
doubts as to the ultimate outcome
dustrial expenditures, of course,
efficient than private enterprise.
are developed - and there is no
ern, progressive, pragmatic educa-
turn there is a current disposition
of democracy. Are we on our way
would have to be considered tem-
sign of these on the horizon - we
(2) As a corollary, Parkinson's
tion have largely driven out courses
to apply political remedies which
to confirming these doubts? These
porary. For the longer run the
which call for serious intellectual
shall find it increasingly difficult
Law applies more obviously to gov-
may well prolong the depression (as
to preserve any semblance of eco-
are the critical years that will
more significant answer is that we
ernment activity than it does to pri-
endeavor.
happened in the 1930's, when the
nomic equilibrium.
decide.
can increase our total output, our
vate enterprise.
We have forgotten that the proper
United States was slower than any
gross national product, sufficient-
task of education is training the
(6) Closely related is the highly
other nation in recovering from the
(3) Pork-barreling and boondog-
ly not only to cover substantially
mind. According to Sloan Wilson,
disturbing problem of inflation. The
world depression) and at the same
How will this issue be decided?
gling activities are impossible to
higher defense expenditures but
only 12% of high school students
latest report of the United States
time set the stage for a later mas-
Quite frankly, the testimony of
eliminate. (For example, on the list
probably at the same time to
are taking any mathematics more
Bureau of Labor Statistics shows an-
sive inflation.
of free government publications are
history is against us. It is an old
advanced than algebra, only 25%
other advance in the cost of living
The vulnerability of capitalism
maintain the current rate of con-
such titles as: "Chiggers, How to
story, often enacted on the stage
are studying physics, and fewer than
index, the seventeenth one in I9
to periodic depression is, of course,
sumption. This can be done
Fight Them"; "Cooking with Dried
15% are studying a foreign lan-
months, bringing the cost of living
a major tenet of the Marxist phi-
of history. While the nice soft
by a moderate increase in hours
Egg"; "Ornamental Woody Vines for
guage. There are 10,000,00 Rus-
some 23% higher than it was only
losophy, and I am sure that the rul-
little boys, so well-mannered, all
worked; by a moderate increase
the Southern Great Plains"; and
sians studying English; only 8,000
10 years ago, in 1948. This rise
ing circles in Moscow will make the
dressed up in their Sunday best,
in the size of the work force,
"Apples in Appealing Ways.")
Americans studying Russian.2
in the cost of living, coming when
most of the current business down-
and scrupulously considerate, are
perhaps drawing in more older
(4) Government is definitely less
business output and employment
turn in the United States. To take
engaged in refining the niceties
"It's Time to Close our Carnival,"
people and more women; and
honest than is business. Consider
Life, March 24, 1958, p. 36.
are declining or stagnant, suggests
the most pessimistic view, our pre-
and improving the rules of gentle-
manly conduct, the tough hard
up of the Baghdad Pact, and sup-
mer; the consummation can oc-
boys climb over the fence and take
port of the Egyptian-Syrian quarrel
cur within as near a period as six
away the marbles.
with Israel.
to ten years. As the climax nears,
Pre-Sputnik United States, fat,
Establishment of virtual Rus-
the tempo will be accelerated.
dumb, and happy, was the great-
sian control of the Middle East,
est sitting duck in history. With
with power to close both the Suez
*
*
our end objectives of prosperity,
Canal and the Red Sea and to shut
a high standard of living for all,
off the flow of oil to Mediterranean
I have deliberately painted a
economic security, short hours,
ports.
dark picture. What is the alterna-
expanded leisure, agreeable life
tive? Must we become a regi-
Exploitation of this control of
adjustment, and so on, we were
mented garrison state? To take
the Middle East by thinly disguised
that course is an admission that
not and are not keeping pace with
intervention in North Africa, ac-
our enemies' dedicated drive for
companied by "oil blackmail" pres-
the USSR has already won the
superiority in knowledge, supe-
sure against Western Europe and
intellectual victory; and so we
England.
instinctively reject that answer.
riority in achievement, and su-
But we are at a critical turning
periority in power.
Rapid growth of the "peace-at-
Are we as yet sufficiently
point. As individuals we shall
any-price" movement in Great Brit-
scared? I do not think so. Even
ain and France.
have to change our scale of values
if attack does not eventuate in
so that we do, voluntarily and
Overwhelming defeat of the
with a sense of mission, some of
the near future, the present signs
Conservative Party in Great Britain
the things which regimentation
all point to a continuous retreat
and rise to power of the Bevan wing
of the Western world from "sum-
might require - such things as
of the Socialist Party.
mit" to "summit" and from "Mu-
spending more on defense, taxing
nich" to "Munich" until we find
Dissolution of the NATO alli-
ourselves more, working harder,
ance.
sacrificing something from our
ourselves in the pit. At Yalta
Stalin is reported to have said
Abandonment by the French
standard of living, disciplining
something like this to Franklin D.
of their North African empire, and
ourselves more, curtailing special
Roosevelt: "Your people fear war.
the rise to power in those regions of
and costly benefits to privileged
My people fear war. But our great
pro-Soviet governments.
economic groups, developing rig-
orous standards and competitive
strength and your great weakness
United States' evacuation of
excellence in education, and chan-
is that we do not fear war as much
its overseas bases in Africa, Europe,
as you do."
and Britain, under pressure from
neling our best brains into need-
I do not think it requires any
the governments concerned.
ful activities for national survival.
Can we do these things? Per-
great stretch of the imagination
A sharp step-up of Soviet de-
sonally, I believe there are some
to visualize a sequence something
mands on the United States.
hopeful signs. It looks as if the
like this:
The rapid growth of a "peace-
tide has started to turn in educa-
A "summit" conference, with
at-any-price" movement in the Unit-
tion; and it may not be too much
Russia's immediate objective to se-
ed States and the winning of an
to hope that a changed sense of
cure recognition of her "interest" in
election by whichever party bids for
values will emerge from the pres-
the Middle East, and for the under-
the support of that group.
ent recession, marking the end of
lying purposes of confusing and
the postwar boom era and a set-
weakening public opinion in the
No doubt along the line there
ting of sights on new objectives
West and at the same time con-
will be other steps in this se-
for the years ahead. But the task
vincing the Russian people that
quence, such as the resumption
will be anything but easy, and
the Kremlin is peace-loving and the
of aggression in Korea, Formosa,
the need for leaders of the moral
West is bent on war.
or elsewhere in the Far East, at
stature and evangelistic fervor of
Further thinly disguised inter-
times calculated to yield the great-
Theodore Roosevelt is overwhelm-
vention in the Middle East involv-
est strategic advantage on the
ingly great.
ing the overthrow of governments
world chessboard. The beginning
still friendly to the West, the break-
can well be right now, this sum-
- Malcolm P. McNair
FORD
GERALD
LIBRARY
GROWTH OF FEDERAL EXPEN
FIGURE COLORS ARE DETERMINED BY
THE PARTY IN CONTROL OF THE
HOUSE OF REPRESENTATIVES
SINCE 1929
HOOVER
ROOSEVELT
'Democrat Congresses in red
Republican Congresses in black
1929
1930
1932
1934
1936
1938
a940
1941
1942
1943
Line 1
FEDERAL FINANCES
1. income
3.9
4.1
1.9
3.1
4.1
5.6
5.1
7.1
12.6
22.0
by fiscal years
2. budget outlay
3.1
3.3
4.7
6.7
8.5
6.8
9.1
13.3
34.0
79.4
3. surplus
0.7
0.7
in billions of dollars
4. deficit
-2.7
-3.6
-4.4
-1.2
-3.9
-6.2
-21.5
-57.4
Line 2
COST TO TAXPAYERS
1. U.S. national income
$87.8
$75.7
$42.5
$49.0
$64.9
$67.6
$81.6
$104.7
$137.7
$170.3
by calendar years
2. Federal spending in cash
$2.6
$2.8
$3.2
$6.4
$8.5
$8.5
$10.1
$20.5
$56.1
$86.0
3. % of national income - Federal
3.0%
3.7%
7.5%
13.1%
13.1%
12.6%
12.4%
19.6%
40.7%
50.5%
in billions of dollars
4. State and local spending in cash
$7.6
$8.3
$7.4
$6.4
$7.4
$8.1
$8.4
$8.2
$7.9
$7.4
5. % of national income - state and local
8.7%
11.0%
17.4%
13.1%
11.4%
12.0%
10.3%
7.8%
5.7%
4.3%
6. Total % taken by public spending
11.6%
14.5%
24.9%
26.1%
24.5%
24.6%
22.7%
27.5%
46.5%
54.8%
Line 3
COST OF LIVING INDEX
73.3
71.4
58.4
57.2
59.3
60.3
59.9
62.9
69.7
74.0
1947-49 = 100
Line 4
PER CAPITA INCOME
in 1947 constant dollars
$927
$859
$703
$725
$888
$858
$981
$1113
$1245
$1277
in current dollars
$682
$604
$389
$411
$517
$505
$576
$697
$871
$977
Line 5
1927
PER CAPITA
1. Federal
$24.17
$37.56
$53.31
$66.75
$53.38
$70.33
$257.59
PUBLIC SPENDING
2. State
$16.15
$20.74
$19.65
$23.65
$30.55
$34.43
$33.89
by fiscal years
3. Local
$49.45
$45.22
$34.15
$34.96
$40.92
$44.40
$41.85
4. Total
$89.70
$103.45
$107.36
$125.25
$124.70
$148.99
$333.13
Line 6
1927
DIVISION OF U. S.
1. Federal
26.9
36.3
49.6
53.3
42.8
47.2
77.3
TAX DOLLAR -
2. State
17.9
20.0
18.2
18.8
24.4
23.0
10.1
in terms of cash spent
3. Local
55.1
43.7
32.1
27.9
32.8
29.8
12.6
Line 7
NATIONAL DEFENSE COSTS
Per capita
$5.56
$6.03
$6.07
$4.23
$7.07
$7.99
$12.66
$177.12
$492.30
Percent of Federal outlay
24.4%
24.0%
16.2%
7.9%
10.6%
15.1%
18.3%
69.3%
83.0%
Line 8
GROSS NATIONAL PRODUCT
1. Actual dollars
$104.4
$91.1
$58.5
$65.0
$82.7
$85.2
$100.6
$125.8
$159.1
$192.5
in billions of dollars
2. 1947 constant dollars
$149.3
$135.2
$107.6
$113.4
$142.5
$145.9
$171.6
$198.2
$223.6
$248.9
3. At 1956 prices
$187.1
$169.5
$133.5
$143.6
$179.5
$181.5
$213.7
$247.2
$278.7
$309.6
Line 9
U. S. POPULATION
122.5
124.5
126.1
127.8
129.5
131.6
132.8
134.2
135.9
in millions
Line 10
U. S. NATIONAL DEBT
Per capita
$132
$156
$214
$264
$286
$325
$367
$537
$1000
In billions of dollars
$16.2
$19.5
$27.1
$33.8
$37.2
$43.0
$49.0
$72.4
$136.7
Line 11
NET PUBLIC AND
PRIVATE DEBT
in billions of dollars
1. Federal
$16.5
$16.5
$21.3
$30.4
$37.7
$40.5
$44.8
$56.3
$101.7
$154.4
2. State and local
$13.2
$14.1
$16.6
$15.9
$16.2
$16.0
$16.5
$16.3
$15.8
$14.9
3. Private
$161.2
$160.4
$136.7
$125.1
$126.4
$123.1
$128.6
$139.0
$141.5
$144.3
4. Total public and private debt
$190.9
$191.0
$174.6
$171.4
$180.3
$179.6
$189.9
$211.6
$259.0
$313.6
Line 12
TREND IN FEDERAL
1. Military cost
$0.85
$1.80
$6.25
$22.90
$63.41
BUDGET OUTLAYS
2. Debt interest
$0.66
$1.04
$1.11
$1.26
$1.81
by fiscal years
3. Other Government costs
$1.94
$6.22
$5.90
$9.88
$14.19
in billions of dollars
Line 13
GOVERNMENT PURCHASE OF
1. Federal
$1.3
$1.4
$1.5
$3.0
$4.8
$5.3
$6.2
$16.9
$52.0
$81.2
GOODS AND SERVICES
2. State and local
$7.2
$7.8
$6.6
$6.8
$7.0
$7.5
$7.9
$7.8
$7.7
$7.4
in billions of dollars
3. Total
$8.5
$9.2
$8.1
$9.8
$11.8
$12.8
$14.1
$24.8
$59.7
$88.6
Line 14
UNEXPENDED BALANCES OF
Appropriation balances
$1.2
$5.0
$6.2
$6.3
$6.1
$6.1
$17.9
$102.1
$117.9
BUDGETARY ACCOUNTS
Total balances
$1.2
$5.0
$6.2
$6.3
$6.1
$6.1
$17.9
$102.1
$117.9
for fiscal years
ending June 30
in billions of dollars
SOURCES
WHAT THE
Line 1 "The Federal Revenue System"
Issued 1956 by Joint
Line 8
"Iconomic Report of the President",
"1. The Federal
"Facts and Problems"
Committee on the Economic
Jan., '57, Page 126₇127, Table E-384
twenty fiscal
Page 139, Table 2
Report, 84th Congress
Line 9
"Budget for 1958" Page 86,
had increased
Line 2
As above, Page 143, Table 6
House Appropriations Hearings
the purchasing
Line 3
Dep't of Labor, Consumer Price Index
Line
10
As above
national debt
Line
4
Figures furnished by Department of
Current dollar figures from
Line 11 "Economic Report of the Président",
ment twenty ye
Commerce, Office of Business Economics
"Bconomic Report of the President"
Jan., '57, Page 173, Table L'44
2. The budget
Jan., '57, Page 137, Table B-14
Line 12 "Facts and Figures on Govet Finance"
transmitted to
Line 5
"Facts and figures on Government Finance",
1957-57, The Tax Foundation
office, calle
1956 - 1957, The Tax Foundation,
Page 62, Table 46
3. Appropriati
Page 55, Table 39
Current figures from 1958 Budget
through 1953,
Line 6 As above, Page 56, Table 40
Line 13 "Economic Report of the President",
for expenditum
Line 7 As above, Page 73, Table 56
Current figures from 1958 Budget
Jan., '57, Page 123, Table E-1
revenues of the
Line 14 Compiled by Treasury Dep!t, May, '57
of goods on 01
on receipt.
GERALD FORD LIBRARY
AL EXPENDITURES
ALL FIGURES FOR 1955 AND
1929
THEREAFTER ARE STILL SUBJECT
TO SOME STATISTICAL REVISION
SEVELT
TRUMAN
EISENHOWER
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
7.1
12.6
estimate
22.0
43.6
44.5
39.8
39.8
41.5
13.3
34.0
79.4
37.7
36.5
47.6
61.4
95.1
98.4
60.4
64.8
39.0
33.1
64.7
60.4
68.1
70.6
73.6
39.5
39.6
44.1
65.4
0.8
8.4
74.3
67.8
64.6
66.5
68.9
71.8
-6.2
-21.5
-57.4
-51.4
-53.9
-20.7
3.5
1.6
1.7
1.8
-1.8
-3.1
-4.0
-9.4
-3.1
-4.2
104.7
$137.7
$170.3
$182.6
$181.2
$179.6
$197.2
$221.6
20.5
$56.1
$86.0
$216.2
$95.6
$84.8
$240.0
$277.0
$37.0
$289.5
$31.1
$35.5
$303.6
$299.7
$324.0
$342.4
$360.0
19.6%
40.7%
50.5%
52.4%
46.8%
$41.5
$40.9
20.6%
$58.0
$71.4
15.8%
16.0%
$77.5
$69.7
$69.0
$71.4
$73.0
$8.2
$7.9
$7.4
19.2%
$7.5
$8.1
17.0%
$10.0
20.9%
24.4%
$12.8
$15.9
25.6%
23.5%
21.3%
20.9%
20.3%
7.8%
$18.2
5.7%
4.3%
4.1%
4.5%
$20.3
$21.4
5.6%
$22.9
6.5%
$24.4
7.2%
$27.3
$29.5
$32.1
$34.0
8.4%
27.5%
46.5%
54.8%
56.5%
8.5%
51.3%
26.2%
7.7%
7.9%
8.0%
22.3%
23.2%
8.9%
9.1%
9.3%
9.4%
27.6%
25.5%
28.7%
32.4%
33.6%
32.5%
30.4%
30.2%
29.7%
62.9
69.7
74.0
75.2
76.9
83.4
95.5
102.8
101.8
102.8
111.0
113.5
114.4
114.8
114.5
116.2
118.9
1113
$1245
$1277
$1312
$1282
$1247
$1173
$1211
$1203
$1280
$697
$871
$1290
$977
$1060
$1311
$1075
$1126
$1342
$1331
$1384
$1422
$1173
$1279
$1261
$1359
$1465
$1508
$1568
$1567
$1635
$1708
$1737
$257.59
$710.48
$459.97
$236.31
$274.60
$33.89
$442.61
$31.35
$47.12
$497.74
$453.25
$432.84
$441.60
$66.23
$85.62
$41.85
$39.96
$87.50
$52.92
$90.94
$69.43
$100.36
$108.32
$122.36
$85.84
$333.13
$781.58
$97.45
$559.70
$102.58
$371.55
$112.94
$123.30
$131.46
$445.59
$627.09
$690.78
$666.02
$663.89
$694.80
77.3
90.9
82.2
63.6
61.6
70.6
10.1
4.0
8.4
72.1
68.1
65.2
63.6
17.7
19.1
12.6
13.9
5.1
13.1
15.0
16.2
9.5
18.7
17.5
19.3
15.5
14.8
17.0
18.6
18.9
$177.12
$492.30
$592.89
$629.20
$329.52
$86.97
$72.59
69.3%
$79.29
83.0%
$78.36
83.7%
85.0%
$124.35
$245.63
72.2%
$277.36
31.2%
31.5%
$251.85
$217.38
$208.58
$210.53
29.3%
29.4%
42.7%
57.6%
58.2%
58.8%
54.3%
53.8%
52.2%
125.8
$159.1
$192.5
$211.4
$213.6
$209.2
$232.2
$257.3
$198.2
$285.1
$223.6
$248.9
$268.2
$257.3
$263.1
$233.8
$328.2
$345.4
$232.2
$243.9
$363.2
$361.2
$391.7
$414.7
$433.5
$247.2
$241.5
$278.7
$264.7
$309.6
$332.6
$325.7
$290.6
$282.9
$289.6
$302.7
$293.7
$305.3
$301.3
$322.8
$332.0
$301.8
$329.9
$354.2
$366.6
$381.6
$376.2
$403.4
$414.7
132.8
134.2
135.9
137.7
139.2
140.7
142.8
145.5
148.0
150.6
153.1
155.8
158.4
161.1
164.0
166.8
171.0
172.5
$367
$537
$1000
$1452
$1849
$1906
$1792
$1721
$72.4
$1694
49.0
$1697
$136.7
$201.0
$258.7
$269.4
$1653
$1650
$1667
$1670
$1660
$258.3
$252.3
$1623
$1600
$1503
$252.8
$257.4
$255.2
$259.1
$266.1
$271.3
$274.4
$272.8
$270.6
$269.2
$56.3
$101.7
$154.4
$211.9
$252.7
$229.7
$223.3
$216.5
$218.6
$218.7
$16.3
$15.8
$218.5
$14.9
$14.1
$222.9
$228.1
$13.7
$13.6
$230.2
$14.4
$16.2
$231.5
$225.4
$18.1
$141.5
$20.7
139.0
$144.3
$144.8
$23.3
$25.8
$139.9
$154.1
$28.6
$180.2
$33.4
$201.3
$38.4
$42.7
$211.7
211.6
$259.0
$251.9
$284.0
$370.8
$308.4
$313.6
$406.3
$397.4
$330.9
$417.9
$434.0
$345.1
$390.3
$425.0
$448.4
$491.3
$525.8
$557.1
$587.6
$608.7
$660.2
$693.0
$6.25
$22.90
$63.41
$75.98
$80.54
$43.15
$14.77
$11.98
$13.99
$1.11
$13.44
$20.86
$1.26
$1.81
$2.60
$40.53
$44.01
$40.47
$3.62
$4.72
$4.96
$5.21
$35.59
$35.79
$36.00
$33.76
$5.34
$5.70
$5.61
$5.90
$9.88
$14.19
$5.86
$16.47
$14.26
$6.50
$12.57
$6.38
$19.31
$15.87
$6.37
$6.85
$7.26
$20.18
$20.42
$17.59
$19.01
$23.76
$20.91
$22.61
$24.90
$25.64
16.9
$52.0
$81.2
$89.0
$74.8
$20.9
$15.8
$21.0
$25.4
$7.8
$22.1
$7.4
$41.0
$7.7
$7.5
$8.1
$54.3
$10.0
$12.8
$59.5
$48.9
$46.7
$15.6
$47.0
$18.2
24.8
$88.6
$19.9
$21.8
$59.7
$96.5
$82.9
$23.2
$24.9
$30.9
$28.6
$27.6
$36.6
$30.1
$32.8
$43.6
$42.0
$62.8
$77.5
$84.4
$76.6
$77.1
$80.2
$85.6
$17.9
$102.1
$117.9
$116.4
$76.8
$28.0
$17.7
$19.6
$11.9
$14.4
$17.9
$102.1
$117.9
$116.4
$50.9
$76.8
$75.7
$28.0
$83.3
$17.7
$19.6
$77.7
$64.3
$52.4
$11.9
$14.4
$68.1
$97.6
$103.9
$101.8
$87.2
$75.5
WHAT THE EISENHOWER ADMINISTRATION INHER ITED
"1. The Federal budget had been balanced in only three of the
4. Finally, legislation enacted since 1933 had provided for a
384
twenty fiscal years ending in 1952; as a result the national debt
large number of fixed charges against the government for domestic
had increased twelve-fold in two decades and inflation had watered
purposes, such as farm price supports, veterans' benefits, and
the purchasing power of the dollar by nearly half. Interest on the
grants to the State and local governments. The effect of this
national debt alone was greater than the entire cost of govern-
legislation was to make about a fifth of the budget subject to
ment twenty years ago.
only very limited control in any one year.
2. The budgets for the fiscal years 1953 and 1954, which had been
Unexpended balances of appropriations carried over from prior
transmitted to the Congress before the new administration took
years ran to nearly $80 billion when the Eisenhower administration
office, called for further deficits in each of those two years
took office, and represented a very large backlog of commitments
3. Appropriations authorized by Congress from fiscal year 1950
for which expenditures had to be made in 1954 and subsequent years.
through 1953, plus those requested in the 1954 budget, provided
These balances have the effect of C.O.D. orders --- they have
for expenditures exceeding by over $95 billion the estimated
to be paid for in cash when the goods are delivered and constitute
revenues of the same five years. This meant an enormous overhang
a heavy overhanging load for the budget beyond the appropriations
'57
of goods on order, which would have to be paid for in the future
being enacted currently."
on receipt.
Excerpts from a speech by Rowland R. Hughes
Director of the Bureau of the Budget,
October 20, 1954
FORD
FORD
LIBRARY
GERALD
LIBRARY
GROWTH
REPUBLICANS ENACTED 10 MAJOR INCOME TAX CHANGES
IN 44 YEARS
ALL BUT ONE WERE TAX REDUCTIONS
PERSONAL INCC
1913-195
1914
WORLD WAR
I-Nov.,
1918
Sept., 1939
Congresses of the United States
Control of House of Representatives
63rd
64th
65th
66th
67th
68th
69th
70th
71st
72nd
73rd
74th
75t
Democrats Red
Republicans Black
1913-1916
1917-1920
1921-1924
1925-1931
1932-1939
1940
PERSONAL EXEMPTIONS
SINGLE
$3000
$1000
$1000
$1500
$1000
$800
MARRIED
$4000
$2000
$2500
$3500
$2500
$2000
DEPENDENT
$0
$200
$400
$400
$400
$400
MINIMUM AND MAXIMUM TAX RATES
1913-1915
1917
1921
1925-1928
1932-1935
Minimum rate
APPLICABLE TO STATED AMOUNTS
Minimum rate
Minimum rate
Minimum rate
Minimum rate
Minimum rate
4% up to $4000
OF INCOME
1% up to $20,000
2% up to $2000
4% up to $4000
1% up to $4000
4% up to $4000
Maximum rate
Maximum rate
Maximum rate
Maximum rate
Maximum rate
Maximum rate
79% over
7% over $500,000
67% over $2,000,000
73% over $1,000,000
25% over $100,000
63% over $1,000,000
$5,000,000
25% earned income
25% earned income cre-
Intermediate
1916
1918
1922-1923
credit continued
dit replaced by 10%
surtax rates
Minimum rate
Minimum rate
Minimum rate
normal tax credit
increased;
2% up to $20,000
6% up to $4000
4% up to $4000
1929
1936-1939
10% defense
Maximum rate
Maximum rate
Maximum rate
Minimum rate
Minimum rate
tax imposed;
over
77% over $1,000,000
56% over $200.000
1½% up to $4000
4% up to $4000
earned income
$2,000,000
25% earned income
Maximum rate
Maximum rate
credit cont'd
1919-1920
credit enacted to
24% over $100,000
79% over $5,000,000
Minimum rate
apply in 1923
25% earned income
10% earned net income
4% up to $4000
1924
credit continued
normal tax credit con-
Maximum rate
Minimum rate
tinued
73% over $1,000,000
2% up to $4000
1930-1931
Maximum rate
Minimum rate
46% over $500,000
13% up to $4000
25% earned income
Maximum bate
credit continued
25% over $100,000
25% earned income
credit continued
SINGLE PERSON NO DEPENDENTS
1917-
1.3%
1921-22
2.7%
1925-28
0.6%
1932-33
2.7%
2.8%
EFFECTIVE RATE ON $3000 NET INCOME
1918-
4.0%
1923-24
2.0%
1929-
0.2%
1934-39
2.3%
1919-20
2.7%
1930-31
0.6%
DOLLAR PAYMENTS
Nothing
1917-
$40
1921-22
$80
1925-28
$17
1932-33
$80
$84
1918-
$120
1923-24
$60
1929-
$6
1934-39
$68
1919-20
$80
$30
1930-31
$17
MARRIED PERSON 2 DEPENDENTS
1913-15
0.2%
1917-
1,3%
1921-22
1.4%
1925-28
0.2%
1932-33
1.4%
1.5%
EFFECTIVE RATE ON $5000 NET INCOME
1916-
0.4%
1918-
3.1%
1923-
1.0%
1929-
0.1%
1934-39
1.0%
1919-20
2.1%
1924-
0.5%
1930-31
0.2%
DOLLAR PAYMENTS
1913-15
$10
1917-
$64
1921-22
$68
1925-28
$8
1932-33
$68
$75
1916-
$20
1918-
$156
1923-
$51
1929-
$3
1934-39
$48
1919-20
$104
1924-
$26
1930-31
$8
PERSONAL INCOME TAXES COLLECTED
1914
$28,300,000
1917
$180,100,000
1921
$3,228,100,000
1925
$845,400,000
1932
$427,200,000
$982,000,000
$
(Fiscal years)
1915
$41,000,000
1918
$2,839,000,000
1922
$2,086,900,000
1926
$879,100,000
1933
$352,600,000
1916
$67,900,000
1919 $2,600,800,000
1923 $1,691,100,000
1927
$911,900,000
1934
$419,500,000
1920 $3,956,900,000
1924 $1,841,800,000
1928
$882,700,000
1935
$527,100,000
Figures for 1918-1923 include corporate
1929
$1,095,500,000
1936
$674,400,000
and excess profits taxes. No separate
1930
$1,146,800,000
1937
$1,091,700,000
figures. for individuals are available.
1931
$833,600,000
1938
$1,286,300,000
1939
$1,028,800,000
PERSONAL INCOME TAX PER CAPITA
1914
$.29
1917
$1.74
1924 $16.14
1925
$7.30
1932
$3.42
$7.44
(Fiscal years)
1915 $.41
1926
$7.41
1933
$2.81
1916
$.67
Figures for 1918-1923 not available
1927
$7.66
1934
$3.31
See note above
1928
$7.33
1935
$4.14
1929
$8.99
1936
$5.26
1930
$9.32
1937
$8.48
1931
$6.72
1938
$9.91
1939
$7.86
PERCENTAGE OF POPULATION FILING
1914
0.36%
1917
3.3%
1921
6.1%
1925
3.6%
1932
3.1%
11.1%
PERSONAL INCOME TAX RETURNS
1915
0.33%
1918
4.2%
1922
6.2%
1926
3.5%
1933
3.0%
1916
0.42%
1919
5.0%
1923
6.9%
1927
3.4%
1934 2.2%
1920
6.8%
1924
6.5%
1928
3.4%
1935
3.6%
1929
3.3%
1936
4.2%
1930
3.0%
1937
4.9%
1931
2.6%
1938
4.8%
1939
5.8%
FORD
GERALD
LIBRARY
GROWTH OF
DEMOCRATS ENACTED 23 MAJOR INCOME TAX CHANGES
NAL INCOME TAX
IN 44 YEARS
ALL BUT THREE WERE TAX INCREASES
1913-1957
1939 €
WORLD WAR II
Aug., 1945
June,
1950
KOREAN WAR
July, 1953
73rd
74th
75th
76th
77th
78th
79th
80th
81st
82nd
83rd
84th
85th
1940
1941
1942-1943
1944-1947
1948-1950-1952-1953
1954 to prêsent
SOURCE
$800
$750
$500
$500
$600
Plus $600 for
$600
"Federal Revenue System
$2000
$1500
$1200
$1000
$1200
aged and blind
$1200
Facts and Problems"
$400
$400
$350
$500
$600
begun in 1948
$600
Joint Comm. on Economic
Report 1956, Page 5
Minimum rate
Minimum rate
Minimum rate
1944-1945
1948-1949
Minimum rate
4% up to $4000
10% up to
19% up to $2000
Minimum rate
Minimum rate
20% up to $2000
Rates and facts taken from
Maximum rate
$2000
Maximum rate
23% up to $2000
20% up to $2000
Maximum rate
tax laws and the Internal
79% over
Maximum rate
88% over $200,000
Maximum rate
Maximum rate
91% over $200,000
Revenue Code
0,000
$5,000,000
81% over
In 1943 a 5% victory
94% over $200,000
91% over $200,000
Subject to a maximum
cre-
Intermediate
$5,000,000
tax was imposed.
Subject to maximum
Subject to a maximum
effective rate limi-
10%
surtax rates
Earned income
Earned income credit
effective rate of 90%
effective rate limi-
tation
increased;
credit cont'd
continued. Withhold-
Earned income
tation
10% defense
ing and current tax
credit repealed
tax imposed;
payment plan enacted
1946-1947
1950
earned income
Minimum rate
Minimum rate
credit cont'd
20% up to $2000
20% up to $2000
0,000
Maximum rate
Maximum rate
ncome
91% over $200,000
91% over $200,000
con-
Subject to a maximum
Subject to a higher
effective rate limi-
maximum effective
tation
rate limitation
1951
Minimum rate
20.4% up to $2000
Maximum rate
91% over $200,000
Subject to a maximum
effective rate limi-
tation
1952-1953
Minimum rate
22.2% upto $2000
Maximum rate
92% over $200,000
Subject to a maximum
effective rate limi-
tation
2.8%
7.4%
1942-
15.7%
1944-45 9.5%
1948-49 13.6%
1954 to date
"Statistical Abstract
1946-47 16.2%
1950-
14.3%
16.3%
of the United States"
1943- 19.1%
1951-
16.6%
1956
Page 363
Unadjusted for transi-
1952-53
18.1%
tion to current payment
$84
$221
1944-45
$585
1948-49
$409
1954 to date
As above
1942-
$472
1943-
1946-47
$485
1950
$428
$488
Page 363
$574
1951
$498
1952-53
$542
1.5%
5.4%
1944-45
15.1%
1948-49
8.6%
1954 to date
As above
1942-
11.8%
1946-47
11.8%
1950
9.0%
10.4%
Page 365
1943-
14.6%
1951
10.6%
1952-53
11.5%
$75
1944-45
$755
1948-49
$432
$271
1954 to date
As above
1942-
$592
1946-47
$589
1950
$452
$520
Page 365
1943-
$730
1951
$530
1952-53
$577
$982,000,000
$1,417,790,000
1944
$18,261,000,000
1948 $20,997,800,000
1954 $32,813,700,000
U. S. Internal Revenue
1942 $3,262,800,000
1945
$19,034,300,000
1949
$18,051,800,000
1955 $31,650,100,000
figures
1943 $6,629,900,000
1946
$18,704,500,000
1950
$17,153,300,000
1956 $35,337,600,000
1947 $19,343,300,000
1951
$22,997,300,000
1952 $29,274,100,000
1953 $32,536,200,000
$7.44
$10.64
1942
$24.23
1944
$132.23
1948
$143.23
1954
$203.69
Computed by using
1943
$48.58
1945
$143.51
1949
$120.99
1955
$192.60
population table B-31
1946
$132.28
1950
$113.09
1956
$211.86
in "Historical Statistics
1947
$134.24
1951
$148.95
of the United States"
1952
$186.46
1953
$205.41
11.1%
19.4%
1942
27.1%
1944
34.0%
1948
35.4%
1954
35.2%
Computed by using
1943
31.9%
1945
35.7%
1949
34.5%
1946
37.4%
population table B-31,
1950
34.8%
and tax return table P-144
1947
38.1%
1951
35.7%
in "Historical Statistics
1952
36.3%
of the United States"
1953
36.5%
FORD
GERALD
GROWTH OF CORPORA
1913-1915 figures are for fiscal years
1916- to date figures are for calendar years
1913-1956
Democrat Congresses in Red
Republican Congresses in Black
63rd 64th
65th
66th
67th
68th
69th
70th
71st
72nd
73rd
74th
1913-1916
1917-1920
1921-1924
1925-1931
1932-1939
1940
Line 1
NUMBER OF CORPORATION
1913
316,909
1917
251,426
1921
356,397
1925
430,072
1932
508,636
516,783
INCOME TAX RETURNS
1914
299,445
1918
317,579
1922
382,883
1926
455,320
1933
504,080
1915
366,443
1919
320,198
1923
398,933
1927
475,031
1934
528,898
1916
341,253
1920
345,595
1924
417,421
1928
495,892
1935
533.631
1929
509,436
1936
530,779
1930
518,736
1937
529,097
1931
516,404
1938
520,501
1939
515,960
Line 2
NUMBER OF CORPORATIONS
1913
188,866
1917
232,079
1921
171,239
1925
252,334
1932
82,646
220,977
WITH NET INCOME
1914
174,205
1918
202,061
1922
212,535
1926
258,134
1933
109,786
AND TAX PAYMENTS
1915
190,911
1919
209,634
1923
233,339
1927
259,849
1934
145,101
1916
2061984
1920
203,233
1924
236,389
1928
268,783
1935
164,231
1929
269,430
1936
203,161
1930
221,420
1937
192,028
1931
175,898
1938
169,884
1939
199,479
Line 3
CORPORATE NET INCOME
1913
$4,714,000,000
1917
$10,730,000,000
1921
$4,336,000,000
1925
$9,584,000,000
1932
$2,153,000,000
$11,203,000,00
REPORTED
1914
$3,940,000,000
1918
$8,362,000,000
1922
$6,964,000,000
1926
$9,673,000,000
1933
$2,986,000,000
1915
$5,310,000,000
1919
$9,411,000,000
1923
$8,322,000,000
1927
$8,982,000,000
1934
$4,275,000,000
1916
$8,766,000,000
1920
$7,903,000,000
1924
$7,587,000,000
1928
$10,618,000,000
1935
$5,165,000,000
1929
$11,654,000,000
1936
$9,478,000,000
1930
$6,429,000,000
1937
$9,635,000,000
1931
$3,683,000,000
1938
$6,526,000,000
1939
$8,827,000,000
Line 4
NUMBER OF CORPORATIONS
1913
128,043
1917
119,347
1921
185,158
1925
177,738
1932
369,238
252,065
WITH NO NET INCOME
1914
125,240
1918
115,518
1922
170,348
1926
197,186
1933
337.056
1915
175,532
1919
110,564
1923
165,594
1927
165,826
1934
324,703
1916
134,269
1920
142,362
1924
181,032
1928
174,828
1935
312,882
1929
186,591
1936
275,696
1930
241,616
1937
285,810
1931
283,806
1938
301,148
1939
270,138
Line 5
CORPORATE DEFICITS
1913
1917
$630,000,000
1921
$3,878,000,000
1925
$1,963,000,000
1932
$7,797,000,000
$2,284,000,000
OR LOSSES REPORTED
1914
not available
1918
$690,000,000
1922
$2,194,000,000
1926
$2,169,000,000
1933
$5,533,000,000
1915
1919
$996,000,000
1923
$2,014,000,000
1927
$2,472,000,000
1934.
$4,181,000,000
1916
$657,000,000
1920
$2,029,000,000
1924
$2,224,000,000
1928
$2,391,000,000
1935
$3,469,000,000
1929
$2,914,000,000
1936
$2,152,000,000
1930
$4,878,000,000
1937
$2,281,000,000
1931
$6,971,000,000
1938
$2,853,000,000
1939
$2,092,000,000
Line 6
CORPORATE PROFITS OR
1913
1917
$10.1
1921
$0.5
1925
$7.6
1932
-$5.6 loss
$8.9
LOSSES, BEFORE TAXES
1914
not available
1918
$7.7
1922
$4.8
1926
$7.5
1933
-$2.5 loss
Figures in billions
1915
1919
$8.4
1923
$6.3
1927
$6.5
1934
$0.1
of dollars
1916
$8.1
1920
$5.9
1924
$5.4
1928
$8.2
1935
$1.7
1929
$8.7
1936
$7.3
1930
$1.6
1937
$7.4
1931
-$3.3 loss
1938
$3.7
1939
$6.7
Line 7
CORPORATE PROFITS OR
1913)
1917
$8.0
21.2%
1921
loss
$0.2
1925
$6.5 15.4%
1932
loss
$5.9
Taxes
en-
$6.4 28.6
LOSSES, AFTER TAXES
1914
not available
1918
$4.5
41.2%
1922
$4.0 16.4%
1926
$6.3 16.4%
1933
loss $3.0 larged
Figures in billions
1915
1919
$6.2
25.8%
1923
$5.4 14.9%
1927
$5.4 17.4%
1934
loss
$0.5 the losses
of dollars
1916
$7.9 2.1%
1920
$4.2
27.7%
1924
$4.5 16.4%
1928
$7.0 14.4%
1935
$1.0 43.3%
And Percentage of Profits
In 1921 taxes
1929
$7.5 13.7%
1936
$6.1 16.3%
Paid for Corporate Income
made the losses
1930
$0.9 44.4%
1937
$6.1 17.4%
Taxes
1931 loss $0.8
1938
$2.8 23.4%
Taxes enlarged the
1939
$5.5 18.3%
Line 8
losses
TOTAL OF CORPORATE
1913
$43,128,000
1917
$2,142,446,000
1921
$701,576,000
1925
$1,170,331,000
1932
$285,576,000
$2,548,546,00
INCOME AND EXCESS
1914
$39,145,000
1918
$3,158,764,000
1922
$783,776,000
1926
$1,229,797,000
1933
$423,068,000
PROFITS TAXES
1915
$56,994,000
1919
$2,175,342,000
1923
$937,106,000
1927
$1,130,674,000
1934
$596,048,000
1916
$171,805,000
1920
$1,625,235,000
1924
$881,550,000
1928
$1,184,142,000
1935
$735,125,000
1929
$1,193,436,000
1936
$1,191,378,000
1930
$711,704,000
1937
$1,276,172,000
1931
$398,994,000
1938
$859,566,000
1939
$1,232,256,000
CORPORATE TAXATION
1913-1956
73rd
74th
75th
76th
77th
78th
79th
80th
81st
82nd
83rd
84th
85th
1940
1941
1942-1943
1944-1947
1948-1953
1954 to present
SOURCE
516,783
509.066
1942
479.677
1944
446,796
1948
630,670
1954 722,805
"Historical Statistics
.080
1943
455,894
1945
454,460
1949
649,957
1955 836,000
of the United States"
,898
1946
526,363
1950
665,992
1956 869,000
Table P-152, Page 308
1947
587,683
1951
687,310
Figures furnished
"Statistical Abstract
.779
1952
705,497
by Statistics Di-
of the United States"
.097
1953
730,974
vision, IRS,
1956
,501
Treasury
Table 437, Page 372
,960
.646
220,977
264,628
1942
269,942
1944
288,904
1948
395,860
1954 441,177
"Historical Statistics
.786
1943
283,735
1945
303,019
1949
384,772
of the United States"
1946
359,310
1950
426,283
1955-56
Table P-153. Page 308
1947
382,531
1951
439.047
not available
1952 442,577
"Statistical Abstract
,028
1953
441,767
of the United States"
,884
1956
.479
Table 437, Page 372
000,000
$11,203,000,000
$18,111,000,000
1942
$24,052,000,000
1944
$27,124,000,000
1948 $36,273,000.000
1954 $39,573,000.000
"Historical Statistics
000,000
1943 $28,718,000,000
1945 $22,165,000,000
1949 $30,577,000,000
1955-56
of the United States"
000,000
1946 $27,185,000.000
1950 $44,141,000,000
not available
Table P-155, Page 308
000,000
1947 $33,381,000,000
1951
$45,333,000.000
000,000
1952 $40,432,000,000
"Statistical Abstract
000,000
1953 $41,819,000,000
of the United States"
000,000
1956
000,000
Table 437, Page 372
252,065
204,278
1942
172,723
1944
123,563
1948
198.383
1954 281,628
"Historical Statistics
,056
1943 136,786
1945
118,106
1949 230,070
of the United States"
1946 131,842
1950
203,031
1955-56
Table P-160, Page 308
,882
1947
169,276
1951
213,329
not available
,696
1952
229,494
"Statistical Abstract
1953
256,208
of the United States"
,148
1956
.138
Table 437, Page 372
000,000
$2,284,000,000
$1,779,000,000
1942 $1,001,000,000
1944
$819,000,000
1948
$1,848,000,000
1954
$3,244,000,000
"Historical Statistics
000,000
1943
$899,000,000
1945 $1,026,000,000
1949
$2,382,000,000
of the United States"
000,000
1946 $1,992,000,000
1950
$1,527,000,000
1955-56
Table P-162, Page 308
000,000
1947 $1,959,000,000
1951
$1,788,000,000
not available
000,000
1952
$1,976,000,000
"Statistical Abstract
000,000
1953
$2,335,000,000
of the United States"
000,000
1956
000,000
Table 437, Page 372
loss
$8.9
$16.3
1942
$23.1
1944
$26.3
1948
$34.4
1954
$36.3
"Historical Statistics
loss
1943
$27.8
1945
$21.1
1949
$28.2
of the United States"
1946
$25.2
1950
$42.6
1955-56
Computed from
1947
$31.4
1951
$43.5
not available
Tables P-155 and P-162
1952
$38.5
1953
$39.5
"Statistical Abstract
of the U. S.", 1956
Computed from Table 437
Taxes en-
$6.4 28.6%
$9.2 43.9%
1942
$10.8
53.2%
1944
$11.4
56.6%
1948
$22.5
34.6%
1954 $19.5 46.4%
"Historical Statistics
larged
1943
$11.9
57.2%
1945
$10.3
51.1%
1949
$18.4
34.8%
of the United States"
the losses
1946
$16.3
35.2%
1950
$25.3
40.6%
1955-56
Computed from Tables
43.3%
1947 $20.4 34.9%
1951
$21.5
50.7%
not available
P-155, P-162, and P-156
16.3%
1952
$19.3
49.8%
17.4%
1953
$19.6
50.3%
"Statistical Abstract
23.4%
of the U. S.", 1956
18.3%
Computed from Table 437
576,000
$2,548,546,000
$7,167,902.000
1942
$12,256,396,000
1944 $14,884,050,000
1948 $11,920,260,000
1954 $16,861,000,000
"Historical Statistics
68,000
1943
$15,925,582,000
1945 $10,794,750,000
1949
$9,817,308,000
of the United States"
048,000
1946 $8,874,840,000
1950 $17,316,932.000
1955-56
Table P-156, Page 308
125,000
1947 $10,981,482,000
1951 $22,082,117,000
not available
378,000
1952 $19,147,694,000
"Statistical Abstract
172,000
1953 $19,869,049,000
of the United States"
566,000
1956
256,000
Table 437, Page 372
FEDERAL TAXATION OTHER TH
Democrat Congresses in Red
Republican Congresses in Black
63rd
64th
65th
66th
67th
68th
69th
70th
71st
72nd
73rd
74th
1913-1916
1917-1920
1921-1924
1925-1931
1932-1939
1940
Line 1
TOTAL EXCISE TAX
1916
$388,000,000
19&7
$405,000,000
1921
$1,134,000,000
1925
$627,000,000
1932
$454,000,000
$1,867,000,000
COLLECTIONS IN ALL
1918
$774,000,000
1922
$891,000,000
1926
$646,000,000
1933
$839,000,000
FORMS
1919$1,138,000,000
1923
$722,000,000
1927
$537,000,000
1934
$1,660,000,000
1920$1,254,000,000
1924
$762,000,000
1928
$539,000,000
1935
$1,872,000,000
1929
$540,000,000
1936
$1,593,000,000
1930
$565,000,000
1937
$1,746,000,000
1931
$520,000,000
1938
$1,716,000,000
1939
$1,749,000,000
Line 2
CUSTOMS COLLECTIONS
1913
$318,891,396
1917
$225,962,393
1921
$308,564,391
1925
$547,561,226
1932
$327,754,969
$348,590,636
Tonnage tax included
1914
$292,320,014
1918
$179,988,385
1922
$356,443,387
1926
$579,430,093
1933
$250,750,251
prior to 1932
1915
$209,786,672
1919
$184,457,867
1923
$561,928,867
1927
$605,449,983
1934
$313,434,302
1916
$213,185,846
1920
$322,902,650
1924
$545,637.504
1928
$568,986,188
1935
$343,353,034
1929
$602,262,786
1936
$386,811,594
1930
$587,000,903
1937
$486,356,599
1931
$378,354,005
1938
$359,187,249
1939
$318,837,311
Line 3
ESTATE AND GIFT TAXES
1917
$6,076,575
1921
$154,043,260
1925
$108,939,896
1932
$47,422,313
$360,071.167
Estate tax initiated
1918
$47,452,880
1922
$139,418,846
1926
$119,216,375
1933
$34,309,724
in 1917
1919 $82,029,983
1923
$126,705,207
1927
$100,339,852
1934
$113,138,364
Gift tax initiated
1920$103,635,563
1924
$102,966,762
1928
$60,087,234
1935
$212,111,959
in 1925
Gift tax dropped
1929
$61,897,141
1936
$378,839,515
1927-1932
1930
$64,769,625
1937
$305,547,766
1931
$48,078,327
1938
$416,874,065
Line 4
INTERNAL REVENUE
1939
$360,715,210
1913
COLLECTIONS OTHER THAN
$309,410,666
1917
$449,684,980
1921
$1,390,379,823
1914
$308,659,733
1925
INCOME AND PROFITS TAXES
1918
$872,028,020
$828,638,068
1922
1932
$1,145,125,064
$503,670,481
$3,177,809,000
1915
$335,467,887
1926
1919$1,296,501,292
$855,599,289
By fiscal years
1923
$945,865,333
1933
$858,217,512
1916
$387,764,776
1920$1,460,082,287
1927
$644,421,542
1924
$953,012,618
1934$1,822,642,347
1928
$621,018,666
1935$2,168,571,390
1929
$607,307,549
1936$2,086,276,174
1930
$628,308,036
1937$2,168,726,286
1931
$569,386,721
1938$3,034,034,000
Line 5
1939$2,972,464,000
TOTAL FEDERAL REDEIPTS,
ALL SOURCES, GROSS
By fiscal years
1913
$724,111,230
1917
$1,124,324,795
1921
$5,624,932,961
1925
$3,780,148,685
1932
$2,005,725,437
$5,893,368,000
(Trust funds included
1914
$734,673,167
1918
$3,664,582,865
1922
$4,109,104,151
1926
$3,962,755,690
1933 $2,079,696,742
1915
$697,910,827
1919
$5,152,257,136
1923
in 1937 and thereafter)
$4,007,135,481
1927
$4,129,394,441
1934 $3,115,554,050
1916
$782,534,548
1920
$6,694,565,389
1924
$4,012,044,702
1928
$4,042,348,156
1935
$3,800,467,202
1929
$4,033,250,225
1936 $4,115,956,615
1930
$4,177,941,702
1937
$5,028,840,237
1931 $3,189,638,632
1938 $6,241,661,000
Line 6
1939
$5,667,824,000
DISTRIBUTION OF
1913
1919
1922
FEDERAL
1927
1936
1940
AMERICAN TAX BURDEN
STATE
$673,000,000
$4,478,000,000
$3,656,000,000
$3,337,000,000
$3,853,000,000
$5,622,000,000
(NET TAX COLLECTIONS)
LOCAL
$301,000,000
$594,000,000
$947,000,000
$1,608,000,000
$2,641,000,000
$4,157,000,000
By fiscal years
TOTAL
$1,308,000,000
$1,681,000,000
$3,069,000,000
$4,479,000,000
$4,083,000,000
$4,503,000,000
(Includes trust
$2,282,000,000
$6,753,000,000
$7,672,000,000
$9,424,000,000
$10,577,000,000
$14,282,000,000
funds)
1913
1919
1922
1927
1936
1940
Line 7
FEDERAL
$7.06
29.5%
$43.39
66.3%
$33.68
47.7%
$28.42
35.4%
$30.28
36.4%
$42.96
39.4
PER CAPITA
STATE
$3.17
13.2%
$5.78
8.8%
$8.76
12.3%
$13.75
17.1%
$20.85
25.0%
$31.92
29.1
BURDEN OF TAXES
LOCAL
$13.72
57.3%
$16.29
24.9%
$28.28
40.0%
$38.15
47.5%
$32.09
38.6%
$34.41
31.5
By fiscal years
TOTAL
$23.94
100.0%
$65.43
100.0%
$70.68
100.0%
$80.27
100.0%
$83.12
100.0%
$109.12
100,0
SOCIAL SECURITY R
SINCE 0
EXPLANATION OF CHARTS
When the personal income tax began in 1914, only single persons
EMPLOYER - EMPLOYEE
with incomes above $3000 and married persons with incomes over $4000
RATES
riled tax returns with the Federal government. Only one in 300 citizens
Social Security tax on
made out tax forms.
wages levied upon em-
Today, most persons making over $600 a year must file returns.
ployer and employee
Some 119 out of 300 citizens file returns with the government.
at identical rate
Consequently, one of the most basic aspects of income tax legislation
is the size of the personal income tax exemption. Exemption amounts
were changed eleven times since 1914 and this accounts for the eleven
vertical columns on the tax charts. The dollar amount of the exemptions
EMPLOYER
EMPLOYEE
forms the first line across the chart.
1937
$265,000,000
$550,000,
COLLECTIONS
The second basic change of concern to taxpayers is in the rates.
1938
$500,000,000
Rates form the second line across the personal income tax chart. Thus
1939
$390,000,000
1940 shows an exemption change and one rate change while 1948 to 1954
shows one exemption change and four changes in rates.
Figures in red denote Democrat control of the House of Representa-
tives in Congress. Figures in black are for Republican years.
Rates are for
SELF EMPLOYED RATES
Obviously the changes in personal income tax exemptions do not
Collections a
apply to corporate income and other Federal taxes, but the vertical
Social Security tax on
Collections 1
columns are continued so that anyone can observe at a glance what other
self-employed is levied
began in 1951
taxes were levied during any of the basic eleven personal income tax
on net earnings from
periods. The Social Security rates and collections are extended through
self-employment at
the basic personal income tax columns.
3/4 the combined employ-
The Expenditure chart is based upon fiscal years rather than upon
er-employee rate.
the tax columns. However, the red figures for Democrats and the black
figures for the Republicans are used.
SELF
EMPLOYED
COLLECTIONS
OTHER THAN PERSONAL AND CORPORATE INCOME
1913-1956
73rd
74th
75th
76th
77th
78th
79th
80th
81st
82nd
83rd
84th
85th
1940
1941
1942-1943
1944-1947
1948-1953
1954 to present
Source
00
$1,867,000,000
$2,381,000,000
1942
$3,123,000,000
1944
$4,462,000,000
1948
$7,412,000,000
1954
$9,517,200,000
"Sales and Excise Taxes"
00
1943
$3,795,000,000
1945
$5,945,000,000
1949
$7,585,000,000
1955
$9,095,900,000
by Dr. B. Manning,
00
1946
$6,684,000,000
1950
$7,559,000,000
1956
$10,035,400,000
Legislative Reference
00
1947
$7,283,000,000
1951
$8,704,000,000
Service, Library of
00
1952
$8,971,000,000
Congress
00
1953
$9,946,000,000
Page 14
00
00
9
$348,590,636
$391,870,013
1942
$388,948,427
1944
$431,252,168
1948
$421,723,000
1954
$562,021,000
"Historical Statistics
1
1943
$324,290,778
1945
$354,775,542
1949
$384,485,000
1955
$606,397,000
of the United States"
2
1946
$435,475,000
1950
$422,650,000
1956
$704,897,000
Table P-90
14
1947
$494,078,000
1951
$624,008,000
14
1952
$550,696,000
"Statistical Abstract
9
1953
$613,420,000
of the U. S1", 1956
19
Table 418, Page 354
1
L3
$360,071.167
$407,057.747
1942
$432,540,288
1944
$511,210,337
1948
$899,345,000
1954
$935,122,000
"Historical Statistics
4
1943
$447,495.678
1945
$643,055,077
1949
$796,538,000
1955
$936,267,000
of the United States"
54
1946
$676,833,000
1950
$706,226,000
1956$1,171,237.000
Tables P-127 and P-128
59
1947
$779,291,000
1951
$729,730,000
5
1952
$833,147,000
"Statistical Abstract
66
1953
$891,284,000
of the U. S.", 1956
55
Table 426, Page 361
LO
81
$3,177,809,000
$3,892,037,000
1942
$5,032,653,000
1944
$7,030,135,000
1948 $10,682,517,000
1954
$16,394,081,000
12
1913-37 "Historical
1943
$6,050,300,000
1945
$8,728,951,000
1949
$10,825,001,000
1955 $16,373,866,000
Statistics of the U.S."
7
1946
$9,425,537,000
1950
$11,185,936,000
1956 $18,476,485,000
90
Page 296, Table P-92
1947
$10,073,840,000
1951 $13,353,541,000
1952 $14,288,369,000
86
1938-56 "Statistical
1953 $15,808,006,000
DO
Abstract of the U.S.,1956"
DO
Page 354, Table 418
437
$5,893,368,000
$7,995,612,000
1942
$13,676,680,000
1943
$23,402,322,000
1944 $45,441,049,000
1948
$46,098,807,000
1954
$73,172,936,000
1913-37 "Historical
742
1945
$47,750,306,000
1949 $42,773,506,000
1955
$69,454,196,000
Statistics of the U.S."
050
1946
$44,238,135,000
1950 $41,310,628,000
1956
$78,820,426,000
Page 296, Table P-89
202
1947
$44,508,189,000
1951 $53,368,672,000
615
1952 $67,999,370,000
1938-56 "Statistical
237
1953 $72,649,135,000
Abstract of the U.S.,1956"
OOO
Page 354, Table 418
OOO
1940
1941
1942
1944
1952
1955
$5,622,000,000
$7,741,000,000
$13,382,000,000
$41,980,000,000
$63,909,000,000
$63,485,000,000
Tax Foundation
$4,157,000,000
$4,507,000,000
$4,979,000,000
$5,390,000,000
$11,290,000,000
$12,735,000,000
Book of "Facts and
$4,503,000,000
$4,736,000,000
$4,633,000,000
$4,705,000,000
$9,470,000,000
$11,889,000,000
Figures", 1956-1957
$14,282,000,000
$16,984,000.000
$22,994,000,000
$52,075,000,000
$84,669,000,000
$88,109,000,000
Page 104, Table 83
1940
1941
1942
1944
1952
.4%
$42.96
39.4%
$58.66
45.6%
$100.53
58.2%
1956 Preliminary
$312.71
80.6%
$416.66
75.5%
$439.18
.0%
29.1%
$34.34
26.5%
$37.62
72.3%
$31.92
21.7%
$40.42
10.4%
As above,
$74.00
13.3%
$89.60
14.7%
.6%
$34.41
31.5%
$35.89
27.9%
$34.80
20.1%
$35.05
9.0%
$61.74
Page 105, Table 84, and
11.2%
$79.12
13.0%
.0%
$109.12
100,0%
$128.71
100.0%
$172.73
100.0%
$387.91
100.0%
Page 106, Table 85
$552.01
100.0%
$607.43
100.0%
ECURITY RATES AND COLLECTIONS
SINCE ORIGIN IN 1937
1937-1949
1% on first $3000 of
earnings
1950
12% on first
1954
2% on first
Dept. of Health,
$3000 of earnings
$3600 of earnings
Education & Welfare
Information Service
1951-53
12% on first
1955-56 2% on first
$3600 of earnings
$4200 of earnings
1957
24% on first
$4200 of earnings
5,000,000
$550,000,000
$688,141,000
1942
$895,619,000
1944
$1,292,122,000
1948
$1,616,162,000
1954
$1,344,055,000
U. S. Treasury
0,000,000
1943 $1,130,495,000
1945
$1,309,919,000
1949
$1,690,296,000
1955
$4,813,290,000
Fiscal Service
0,000,000
1946
$1,238,218,000
1950
$2,106,388,000
1956
$5,828,512,000
Bureau of Accounts
1947
$1,459,492,000
1951,
$3,119,537,000
1952,
$3,318,557,000
1953
$3,833,369,000
Rates are for calendar years.
Collections are by fiscal years.
1951-53 21% on first
1954
3% on first $3600
Dept. of Health,
Collections from self-employed
$3600 of earnings
of earnings
Education & Welfare
began in 1951.
Information Service
1955-56 #5 on first
$4200 of earnings
1957
3 3/8% on first
$4200 of earnings
1952
$250,000,000
1954
$193,214,000
U. S. Treasury
1953
$252,924,000
1955
$226,283,000
Fiscal Service
1956
$508,293,000
Bureau of Accounts
THE NATIO PROGRAM
A Monthly Letter
of thought and opinion
letter
TO STRENGTHEN
about America's problems
AND SAFEGUARD
the STRUCTURE of
AMERICAN
FREEDOM
A CITIZEN'S POLITICAL RESPONSIBILITY
In the nationwide elections last month 46,000,-
But they were zealous in their cause. They were
000 people voted. That constituted about 60 per
willing to work and make sacrifices of time and
cent of the eligible voters in the United States. In
energy. This little group of Communists won their
other words, four out of every 10 eligible voters
first objective - the overthrow of the Russian gov-
failed to exercise this great individual freedom and
ernment and the establishment of a Marxist Socialist
thus defaulted on their greatest citizenship responsi-
state. Today the Communist Party whose leaders
bility. Even though only 60 per cent voted, this was
run Russia (and have enslaved a big segment of the
a far bigger percentage than vote regularly in local,
world's people) numbers about 6,000,000 - or 3%
county and state elections. The sad fact is that
of the population of Russia. They are working at
counting all elections only about 20 per cent of the
and winning control of the world.
eligible voters vote regularly.
In England during the last 50 years a tiny group
Even among the 60 per cent who did vote last
of people who called themselves Fabian Socialists
month, not more than 10 per cent actually worked
worked zealously and effectively in politics, and
in a precinct political organization trying to win
they finally won control of Britain and drastically
victory for the candidates and issues of a particular
changed the governmental structure. In a few years,
political party. In other words, most American
they had SO dissipated the economic strength of the
citizens are not active politically. The only political
nation that there is now serious doubt that Britain's
responsibility they accept is the casting of a ballot.
50,000,000 people will escape the quagmire of total
They take no part in the actual selection of candi-
Socialism or Communism.
dates or issues. They do not get down into the
firing line of politics at the precinct level. All these
Announcing a Filmstrip
responsibilities are left to a comparatively small
group.
Throughout history we find similar clear lessons
reaffirming that no people can long default on their
We Let "George" Do It
full political responsibilities and continue to be free.
In our National Education Program workshop in
What this means is that a few thousand people
Searcy, we have developed a dramatic sound-color
in a given state, or a few hundred in a county or
filmstrip which brings this fact right to the door-
community, virtually run the politics, call the shots
step of the families of America. It is being offered
on candidates and issues. And their work on elec-
to individuals, groups, associations, political parties,
tion day shapes the future of every American citizen.
industries, employee organizations, civic clubs and
Look around you in your community and state. How
schools.
well does the average voter or eligible voter know
the candidate for whom he voted? Did you have a
The filmstrip presentation is entitled, "A Citi-
part in shaping the issues? Is the candidate the
zen's Political Responsibility." Its stated objectives
best man in the community, the best qualified for
are: (1) to promote better individual citizenship by
the office and service for which he is asking election?
motivating the citizen to understand politics and be-
come active in the party of his choice; and (2) to
If the answer to this last question is "No"; then
inform the citizen in the practical aspect of political
you as a citizen in one of the few remaining free
countries of the world are falling down on your
action at the precinct level. It might well be called
"a blueprint" for individual or group political action.
political responsibility. You are jeopardizing free-
It is being distributed at production cost - $18 with
dom and all the potential blessings inherent in our
American way of life.
turntable disc and $20 with tape recorded playback.
This is another public service project of our National
Lenin in Russia 40 years ago set out to win a
Education Program designed to strengthen and safe-
political objective. He had only 40,000 followers.
guard the structure of American freedom.
FORD
GERALD
Government Is YOUR Business
ONE MAN'S POWER
Political A. B. C.'s
Additional Excerpts:
The A. B. C.'s come first. And the first duty
When we feel the direct impact of legislation
upon you is to accept the responsibility to act
Excerpts from the audio-tape of "A Citizen's
citizens who agree to take on difficult civic assign-
upon our ability to keep a steady job, we can get
as your party's representative to 20 families in
Political Responsibility":
the neighborhood. Accept the assignment and
ments at considerable personal sacrifice, because
excited enough to even write a letter to our Con-
then go about getting acquainted with those
It has been said that Government is you and
they receive a sense of personal pride and satis-
gressman. But just SO long as governmental action
20 families. Call on them in a spirit of service
I, and all of us together. It's a collection of rules
faction when they are able to contribute their ideas,
is not detrimental to us personally, and in a manner
in a common interest.
and regulations and authorizations. It is not a
time and efforts toward solving various problems
in which we can see it and feel it, most of us will
Know their interests.
human, living thing you can see or touch with your
confronting their community.
leave politics to the politicians.
Win their confidence.
fingers. But, rather, it is a group of powers and
The self-seeking politicians - and this breed
Stimulate community spirit.
Preserving A Heritage
laws and authorities, all vested in the hands of
is powerful in every political organization - want
Be well informed - and honest.
people elected to political office by the franchise of
The third and largest group of citizens inter-
you to "leave it to George." They know George
Become acquainted with your local political
the free ballot given to you and me.
viewed told us they were active in the community
won't do it either. They want you and George to
authorities - if you haven't already done SO.
Get a copy of your local voting list.
These governmental officials whom we elect by
because of their families and because of their chil-
stay away from civic and governmental affairs. So
Any worker anywhere must have tools to
our action or inaction are armed by the Constitution
dren. They decided that the country and the system
when you say, "Don't mix politics and business," or
work with. In organizing a precinct for political
with great and challenging powers affecting all of
had afforded them excellent opportunities, and they
"Let George do it," or "Politics are dirty," please
action you need this information:
us and that's why we say, "Government is your
wanted to do something about strengthening their
remember that these Georges want you to stay away
Complete name and address of each voter.
Business!" Either you run your Government, or
community and the American way of life, in order
SO they can operate all the angles to make politics
Party affiliation.
Government runs you!
that their children might have the same opportuni-
pay off for them.
Are there young voters or those coming of
ties of individual freedom and incentives that they
Your Political Role
age?
Start in Community
had had. And this is a paramount reason for per-
Are voters newly naturalized or should they
sonal activity in the political party of your choice.
These ward or precinct leaders don't have to
be?
Before examining your responsibility in the
be shamed, threatened, begged, caioled into going
Does the voter require transportation on
running of our Government, it is well to take stock
Everything that your family holds dear, especially
to the polls and taking everyone within reach with
election day?
of your interest in the civic affairs of your com-
the future of your children, is subject to the actions
munity, since such an interest should be the founda-
of the Government which you and your fellow citi-
them. They have a real dollars-and-cents interest
In addition you need this additional voting
information: location of precinct voting booth;
zens create and to which you give great power over
in these elections; they have a yen for power and
tion of your political action. We asked a lot of
map of the precinct; registration requirements;
your lives and future.
easy money. They don't mind a bit if we merely
date of primary, general and special elections;
people who are active in community affairs exactly
Government is your business - you have a
talk about our convictions, wring our hands at the
the procedure for the absentee ballot; names of
why they felt they should do something about mak-
breakdown of faith and morals and confine ourselves
ing their community a better place to live, work,
direct and personal duty toward its betterment that
incumbents; their terms of office; names of the
to complaining. Their only fear and worry is that
candidates for office for whom the electors in
and raise a family. We received three types of
you cannot delegate or dodge. That duty begins
some day we might wake up and try to do something
your precinct will vote at the next election and
answers.
with an understanding of politics, and is imple-
about our convictions.
what their qualifications are; what offices are
mented by political action.
The first group we interviewed told us they
But what can one man do? One citizen? Is
to be filled
were active in the community because of the per-
And yet - SO many men and women, when
that what you are thinking?
So much for the informational tools. Now
sonal self-development potentials. Some said, for
politics demand their attention, say, "Let George
about the duties.
Here is a motto: "One Man can change the
example, that their present jobs were confined to
Do It!" The businessman says, "I'm in business -
Call on the voters in this precinct. Notice
World!"
why mix politics with business?" The professional
voters with qualities of leadership who will
only one phase of business or professional activity
Each person can play a role of his own choosing
person says, "It's not the thing for me." The wage
make good campaign assistants and election
(or homemaking) and SO civic participation helped
in shaping the destiny of mankind. The future is
booth attendants. Relay this information
them to broaden their understanding and service,
earner says, "Why bother? just a few run every-
ours to make. If things are wrong with our com-
directly to the precinct captain.
and improve their outlook for the future in their
thing; my influence wouldn't count." The housewife
munity, our nation or the world, our actions as
Send a digest, to your Congressman or Con-
vocation.
says, "A woman's place is in the home." And the
citizens will determine whether they shall remain
gressional candidate, of the reaction of voters
office worker says, "I simply haven't the time or the
wrong or be changed for the better. Suppose you
to major issues.
In the second group were typical examples of
desire."
were to start as one force for honesty, integrity and
And lastly - organizing the precinct for the
ability - in your local politics. What can one man
campaign. Here are some of the mechanical
needs: calling cards for your assistants; a large
do? Let's see.
map of the precinct; a list of registered and
Outline for Action
prospective voters; election statistics for the
precinct for the last three elections, showing
We call our approach to the solution of this
the vote for major candidates; list of party
A PERSONAL NOTE
problem the Four Point Formula - Study Up, Join
nominees.
Up, Speak Up, and Build Un
The job is a job for workers. You'll need a
These demands of activities (explored in detail
precinct assistant for each 20 families in the
in the full presentation) for the betterment of your
area. You'll need volunteers from the ranks of
Dr. George S. Benson
community, state and nation, prepare and qualify
your party's women's clubs, at whatever level.
Director
you to get busy in partisan political action
Both
You'll need to draw on your party's young
peoples' clubs and other groups for the distribu-
the major parties hold their precinct meetings in
tion of campaign literature. You'll want to
In analyzing the defeat of his bill in the Senate
even years. The Republicans elect a precinct com-
attract to your campaign organization members
designed to re-establish one of the internal safe-
lated to defeat the measure. This is a demonstration
mitteeman and committeewoman, and the Democrats
of the Armed services and veterans. You'll
guards against Communism which the Supreme
of political action. The left-wing apparatus can get
elect a man and woman precinct co-chairmen.
want to draw workers from non-partisan
Court had destroyed. Senator McClellan noted that
50,000 letters written and mailed into Congress in
The precinct is the grass roots of our political
groups - service and social clubs. By all
it had passed overwhelmingly in the House and had
72 hours! And they have great political power. They
been expected to be passed by the Senate by a two-
have one of the smoothest organizations and propa-
party organization which elects delegates to state
means work hard to get independent voters
to-one vote. When it reached the Senate, however,
ganda mills in the world. On the other hand the
conventions and calls the shots in every other way;
into action behind your candidates and plat-
something happened. An avalanche of mail opposing
rank and file of the American people are inactive
it is the wheel of activity in local political campaigns.
forms. Find men and women of foreign
the bill flowed in on the Senators. Heavy pressure
or inept in political affairs - and unless this is
Party members at the precinct meetings determine
descent for work with the newly naturalized
and displaced persons.
was brought to bear by "liberals." The leadership of
changed, our liberty and prosperity will be in critical
party platforms and policies and nominate candi-
Draft party members best suited to do
both parties was swung behind manipulations calcu-
jeopardy.
dates from local to presidential. Dates and times
person-to-person campaigning in hospitals, rest
of meetings vary from state to state
homes, and other institutions.
COMMON-SENSE ECONOMICS
A few years ago a national organization made
lished by The Stackpole Company, Harrisburg,
an opinion poll of newspaper editorial writers to
Pennsylvania ($4.95). Gilbert Tucker is a friend of
obtain their attitudes on a number of economic
mine. I have found him to be a man of sound logic,
questions. The writers were asked if they favored
and his book reflects a great talent for clarity as well
certain measures of legislation affecting economic
as an entertaining sense of humor.
activities within the nation. And at the end of the
list of questions was this one: "Would it be advis-
So far as is humanly possible, he has tried to
able to adopt Socialism as an economic system for
present the economic facts of life devoid of the
America?
jargon and the seemingly endless dog-after-his-tail
involvements of the classic academic economist. He
An overwhelming number of the editorial writ-
has gone far toward achieving success in this goal.
ers participating in the survey said "No" to the
His book is readable. His arguments for his view-
last question - they registered themselves as
points are clear and logical. A beginner or a scholar
opposed to Socialism for America. But surprisingly
can learn a great deal of economics from this book.
enough, a substantial number of them favored in-
dividual legislative measures taken directly from
the textbook of Socialism. In other words, they
Basic Economic Facts
thought they were opposed to Socialism, but when
Mr. Tucker spends considerable time in showing
Socialism's economic program was broken down
the need for tax reform in America. Most of the
into separate measures - not labeled as Socialist
best informed tax experts are agreed that long over-
- they registered approval of some of its vital parts.
due tax reform must now be considered a "must" for
This opinion survey revealed two important
safeguarding our nation, and this includes my friend
dangers: (1) Many influential people in America do
Representative Wilbur Mills, chairman of the House
not understand the economic facts of life, and (2)
Ways and Means Committee. They may not all
The real danger of Socialism to America is its insidi-
accept Mr. Tucker's suggestions, but all would be
ous, unrecognized advance.
stimulated and benefited by studying them.
"We believe," says Mr. Tucker, "that economics
A New Book
can be made a fascinating subject We believe also
that it is one of the most necessary
for if the
A new book on economics has come to my at-
next generations are not better trained than we have
tention. It is entitled, "Common-Sense Economics."
been, it is unfair and dangerous to toss into their
That is exactly what we need in the whole realm of
laps such questions as inflation, taxation, public bor-
economics common sense writing and common
rowing, the conflict of Communism with the Ameri-
sense appraisal. This new book was written by Gil-
can idea, and a hundred other questions." To this
bert M. Tucker of Albany, New York, and is pub-
we can say, "Amen!"
SUBSCRIPTION PRICE $1 PER YEAR. QUANTITY COPIES ARE AVAILABLE AT THREE CENTS EACH - WRITE:
THE NATIONAL EDUCATION PROGRAM. 815 E. CENTER, SEARCY. ARKANSAS
NON PROFIT ORG.
U. S. POSTAGE
THE NATIONAL letter PROGRAM
PAID
PERMIT NO. 94
SEARCY, ARKANSAS
TO STRENGTHEN
December 1958
the
of
AM
FREEDOM
The Honorable Gerald R. Ford, Jr.
House Office Building
Washington 25, D. C.
B.FORE
GERALD
News
REPUBLICAN NATIONAL COMMITTEE
release
NAtional 8-6800
1625 Eye Street, Northwest
Washington 6, D. C.
10
FOR RELEASE
FOR RELEASE 12:15 PM (CDT)
WEDNESDAY, OCTOBER 15, 1958
ADDRESS BY
POSTMASTER GENERAL ARTHUR E. SUMMERFIELD
40TH ANNUAL MEETING, ILLINOIS STATE CHAMBER OF COMMERCE
CHICAGO, ILLINOIS -- OCTOBER 15, 1958
For almost four decades this Illinois State Chamber of Commerce has been
distinguished because of the imagination and energy of its members.
Years ago as a businessman in the Midwest, I became acquainted with the
Chamber's activities -- and it is my high regard for many among you and your
deeds that has brought me here today.
I am proud to be associated with the Postal Service of the United States.
It is our governmental activity closest to the people. It is the only
large Government service which tries to match expenses with revenues.
As businessmen and leaders in your communities, I am certain you are
intensely interested in the Postal Service. For you it provides the vital needs
of communication with customers and clients, with friends and relatives in all
parts of the United States and the world.
We Americans have the biggest mail service in the world. While the United
States occupies only one-fiftieth of the land surface of the globe and has one-
fifteenth of its population, we send and receive nearly two-thirds of the
world's mail.
Our expenses run more than three and one-half billion dollars a year.
Our cash transactions on a yearly basis, including 400 million money
orders, total more than twenty-three billion dollars.
6ERALD FORD
(more)
- 2 -
We are now handling more than 60 billion pieces of mail annually, plus a
billion pieces of parcel post.
Recently, our mail volume has been increasing percentage-wise about twice
as rapidly as our population has grown. Since 1948 our mail volume has in-
creased by nearly 19 billion pieces which is more mail than the present yearly
mail volume of France, Germany and Canada combined.
In the last few years we have greatly improved the Postal Service -- first,
by expediting the delivery of all classes of mail; and second, by reducing the
postal deficit.
Moreover, we have had over 2,500 new post offices constructed under an
arrangement whereby private industry builds and owns the facility which is
leased to the Post Office Department.
Next year I will ask Congress for appropriations for the mail-handling
equipment for approximately 12,000 badly needed new post offices we expect to
have built with private capital throughout the nation.
It is in the best interests of the businessmen of America to support this
program and I urge each of you to use your influence to secure universal support
for the completion of this postal modernization.
We have cut the postal deficit -- not only through better methods and
procedures and the elimination of subsidies -- but also by increasing postal
revenues so today the Postal Service is more nearly self-supporting.
Had we failed in raising postal rates, the postal deficit would have
reached shocking proportions.
It would have been over ONE BILLION DOLLARS A YEAR!
Thanks, however, to increased efficiency, economy and increased postal
FORD
rates, the actual postal deficit for the 1959 fiscal year will be about $350
(more)
GERAL
LEBRARY
- 3 -
million, after giving credit for public service costs.
These many savings notwithstanding, we have brought direct mail service
to millions of new American homes and rural communities.
It is my earnest hope that all the users of the mail will now embark on
a program of mutual cooperation with us so that we can achieve two prime goals --
first, a more nearly self-supporting operation of the Post Office Department;
and second, next-day delivery of First class letter mail between any two cities
in the United States!
On both counts, we need your cooperation!
Indeed we need your help -- and on our part we will, as we have in the past,
always stand ready to extend to you our wholehearted assistance in connection
with your postal problems.
Not only am I concerned with the Postal Service of this nation.
I am also concerned about the future of the private enterprise system in
America which is so heavily influenced by our governmental activities.
Today I should like to expand my remarks beyond those about the Post Office
Department to a subject I consider of vital importance to every citizen.
The threat to our economic structure is one which should concern every one
of us. It concerns me greatly as I come before you today as an American citizen,
who has had experience over many years in both business and in government.
The opinions and suggestions I offer are my own. While they may vary, in
certain fundamentals, from some heretofore expressed, my purpose is not to
assign responsibility for past failures or to precipitate partisan controversy.
The times have changed, the issues are so grave, and we need a fresh outlook.
These are years of challenge for America -- for the American people as a
whole and for each individual citizen. We face challenges in the fields of
science and technology as the space age opens before us. We face challenges
(more)
- 4 -
in education; in learning to live together in mutual respect and cooperation.
We face challenges which will test our spiritual vigor and our political wisdom
and discernment.
But, looming over all, we face the challenge of Soviet communism -- a
force which has proclaimed, through the lips. of Khrushchev, an intention to
bury us.
The communist menace of which I speak is two-fold -- military and economic.
And it is with this latter challenge that I wish to deal today. For, make no
mistake about it, the Soviet blueprint to bury us is more of an economic blue-
print than a military one. The Russian leaders intend to drive their people, and
to deny their people, until they have overmatched us in productive capacity. They
intend to build factories and plants and laboratories, at whatever cost, until
they can outproduce us in the sinews of war and the goods of peace. And then,
they firmly believe, we will be at their mercy.
For ourselves, we depend on the ways of free men to keep ahead. There is
no point in adopting, out of fear and doubt, the same sort of bureaucratic
dictatorship over our lives and actions which Khruschev himself would install
were he to conquer us.
This brings me to the nub of the challenge which faces us. It is this:
How do we maintain our military and economic superiority over communism and
at the same time keep our freedom?
Before we can answer this question, I think we've got to ask ourselves
three more questions, and we'd better give ourselves honest answers because
if we don't we are truly in danger.
First, what are the factors or incentives which motivate our free economy
to produce and to grow?
(more)
- 5 -
Second, what impediments or interferences have we allowed to come into
being which hamper the full realization of our economic potential?
And third, what must we do to remove these hindrances and set in motion
a great surge of progress which will leave the Russians far behind and destroy
the myth they are so desperately trying to create that communism offers a
superior economic system?
Before proceeding to a discussion of these questions, I think it might
be well to get our political orientation straight. I am a member of the
Republican Party and I speak as a Republican. I adhere to a definite philosophy
which was best expressed by President Eisenhower when he stated that the Republican
Party believes in being conservative when it comes to economic matters and
liberal in dealing with human wants and aspirations.
To my mind the philosophy of government laid down by the President is not
only consistent but sound. It means that the Federal Government recognizes
and will discharge every legitimate obligation it owes to the citizens but at
the same time will do everything it can to protect the value of their bank
accounts, their life insurance, their pensions, their government bonds, and
other forms of savings which frugal and thrifty citizens set aside for their
comfort and security in later years. It means that those charged with the
duty of government will not resort to the easy road of inflation to make
good on its commitments to the people, but by following sound and conservative
economic policies will stimulate the expansion and growth of our free economy
so that there will be abundance for all and ample revenue for the Government
to pay its bills without deficits and without inflation.
The opposition on the other hand - or at least those factions which control its
overall national policies - apparently aims at creating a gulf between the people and
(more)
QUEALO R. FORD
- 6 -
the economic system on which they depend for their livelihood and well-being,
a gulf which it seeks to exploit for selfish political purposes.
This dominant faction of the opposition would promise the people more
and more benefits and services to be paid for in the false coin of inflation.
And at the same time, it would hamper and harass the industrial and business
system which is expected to create the wherewithal to make good on these
promises. This is the real inconsistency.
This is a road fraught with peril. It would end in disastrous inflation
and economic collapse. It would steadily weaken not only our industrial
strength but the moral fibre of our people. It would allow Soviet Russia to
achieve dominance over America and the rest of the world without firing a shot,
It fails completely to recognize or take into account the factors and incentives
on which a free people must rely to motivate the economic growth and development
which are essential if America is to win out in either a cold or hot war.
This brings me back to the first question I raised earlier: what are the
factors and incentives which motivate our free economy to produce and grow?
We must recognize at once that these incentives are personal and individual.
The largest corporation is, after all, only a collection of individuals - motivated
in great measure -- and properly 80 -- by the expectation, or the hope, of
financial reward. The stockholder who invests his money hopes to earn a profit.
If the profit is not realized, or is insufficient, he will withdraw his money
and put it where he hopes it will do better. The executive who improves the
efficiency and earning power of his company will increase his own status and
financial position. The workers in the plant which produces more know that this
increased productivity will result in more take-home pay and a better standard
2
of living for themselves and their families.
(more)
CERALD
-
in 7 - *
The same factors operate in the case of unincorporated business enterprises -
and 84 per cent of the business concerns in this country are unincorporated.
And it is the sum total of all of these individual efforts which add up to
economic expansion and growth; which results in a rising standard of living
for all; which provide the sinews of the nation's defensive strength.
There is no way to substitute for this individual motivation if we are to
keep our economy free. And we firmly believe, on the basis of demonstrated
performance, that our free economy will produce more abundantly by far than
any kind of regimented or controlled economy.
This brings me to the second question: What are the impediments or hind-
rances which hamper economic expansion and growth?
The answer is found principally in two areas -- taxes, and monopolized labor.
The more serious of these is the present tax structure which is out-dated
and the result in large part of the prejudices. and emergencies of the past.
We have failed to recognize and appreciate the importance to our national welfare
of the growth of capital resources largely due to the fact that we have been
through two wars during which our government's need for revenues was tremendous
and war profiteering was the center of popular attention. To confiscate profits
became a laudable objective of government.
The second great hindrance to our economic development is the steady rise
in the cost of doing business which union monopoly power, in the hands of a
few union bosses, is forcing on this country. It takes more than courage these
days to open a new business or to bring out a new product when it is virtually
certain that labor costs will rise year by year, regardless of the productivity
of that labor.
(more)
- 8 -
Justification for this wage-price inflation is claimed on the ground that
consumers do not have enough purchasing power to buy, and that the remedy is
to pay higher wages out of the enormous profits business is supposed to be
making. But business profits as a percentage of sales are lower today than
they were even during the great depression. To go lower would endanger the
basic incentive which sparks our free economic system.
The purchasing theory, as it is being used today by some labor bosses in attempt-
ing to justify unearned wage increases, is false and self-serving. Wage gains in
basic industries, unmatched by increases in the productivity of labor, force
prices up and set patterns which spread through the entire business structure,
even to the service trades where improvements in productivity are slow or
non-existent. Thus even those who get the wage increases do not really benefit.
The rising price level promptly catches up with them.
But meanwhile tens of millions of consumers who can least afford it find
their purchasing power lessened. These are the people on fixed incomes or
whose incomes are slow to rise in response to inflationary pressures --
pensioners, social security recipients, beneficiaries of life insurance
policies; also school teachers, clergymen, government workers and many cate-
gories of salaried employees.
This group totals nearly 21 million people, all of whom are robbed by
inflation of some of the purchasing power they have every right to count on.
When we contemplated the vast sums flowing into the economic stream from
such sources as these - all of which form part of the sum total of consumer
purchasing power - it is evident that everyone would be better off, including workers
in the factories and on the farms, if a proper proportion of the nation's rising pro-
ductivity could be channelled into lower prices instead of being discounted,
(more)
GERALD even far
- 9 -
in advance, by unwarranted wage demands which bring no lasting benefit to anyone.
The third question we must answer, therefore, is: What can we do to
remove these obstacles to progress so that we can surge forward with all
the initiative and energy of which our free economic system is capable?
The Vice President of the United States courageously put his finger on
some of the things we can do in a speech at Harvard University on September 6th.
Speaking of the impact of taxation on business growth and expansion, Mr.
Nixon called for an overhaul of the tax structure. "Our goal," he said,
"should be to fashion a tax structure which will create more jobs, more income
and more genuine security."
He pointed out that if our economy were to grow at the rate of five per
cent a year we would have ten billion dollars more in tax receipts in 1962
than if we were to continue to grow at the recent rate of one and one-half
per cent.
Specifically; he advocated more liberal treatment of depreciation for
business taxation purposes in order to stimulate risk-taking and investment
in new plants and equipment. He said that there are strong reasons to believe
that the stimulating effects of even a small cut in the corporate tax rate
would lead to more rather than less revenue. He stated his belief that any
small loss of revenue which might be caused by some reduction of the almost
confiscatory personal income tax rates would inevitably be offset by the new
investment and business expansion which would result.
In the context of what the Vice President said, let me just leave with
you here a few factual observations and a few personal thoughts about a possible
remedy.
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It may come as a shock to you to know that Russia's productive capacity
is growing almost three times as fast as ours -- 8 per cent a year as compared
to 3 per cent.
If these rates remain unchanged, Russia's total production rate will
approximately equal 50 per cent of ours in 6 years, 75 per cent in 13 years,
and 100 per cent in 1980, 22 years from now.
But for many complicated reasons, there is ground for believing that -- if
our present tax policies remain unchanged -- our growth rate could drop to 2 per
cent a year. If this happens, with Russia's production proceeding at 8 per cent,
their total would approximately equal 50 per cent of ours in 6 years -- 75 per
cent in 11 years -- and 100 per cent when children being born today reach the
age of 18.
This does not need to happen. It is not inevitable. If the U. S. economy
grows at a rate of 6 per cent, even if the Russian growth is 8 per cent, it
would take them until the year 2,015 to match us, if ever.
It is hardly necessary to point out that military might and industrial
might go together. The lesson the world learned from World War II is that
industrial superiority is essential to victory.
So the challenge confronting us today is clear. We must find ways of
providing the capital formation which will make the greatest industrial growth
possible.
Thus stated, the challenge may not sound inspiring. But it can be stated
in other terms. Stimulating an increase of our productive capacity to 6 per
cent a year can be a tremendous factor in maintaining peace in the world in
this century, and the security which peace brings. And, on the other hand, it
has not yet seen.
can produce an cra of individual opportunity and prosperity such as the world GERALE
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This must come about through tax reform and gradual tax reduction. In
my opinion, it can only come about through progressive tax reduction. This,
of course, means that Federal spending must be kept at an absolute minimum
consistent with our National Defense needs and maintaining other necessary
Government activities. Immediate and sharp reduction in all income tax rates
could not be achieved without substituting some other burdensome form of
taxation, or by increasing the prospective level of deficits for several years.
So the reductions must be made by progressive stages. The best available
alternative is the enactment of legislation under which these rates can be
brought down to reasonable and moderate levels by repeated annual reductions
over a period of years.
This is not, my friends, a proposal for a "trickle-down" theory of tax
reduction, but instead is an equitable tax reduction for all taxpayers, large
and small.
I ask you to imagine what would happen throughout the country -- in the
offices and plants where future business plans are made -- and in millions of
homes where buying decisions are made -- if your government were to announce
and adopt a tax program which has as its committed goal an ultimate tax pattern
such as this:
1. A cut in individual taxes.
2. A cut in corporation rates.
3. Corresponding cuts in Capital Gains, Estate, Gift, and
Excise Taxes.
The effect of such a program introducing equity and balance in our tax
structure, on the state of mind and initiative of the American public would
be immediate and electrifying -- provided the program firmly commits the Govern-
ment to a complete fulfilment of its terms in a specified period of time.
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It is natural for critics and demagogues to ask -- can this be done
without deficits and without inflation?
Over the period of this program, there is every reason to believe
that the lowered tax rates would be more than compensated for in the
revenue increase they would precipitate.-
This is a complex subject, in which facts from past experience should
be considered.
For a span of 60 years -- up to 1930 -- our economy grew in the range
of 4 per cent a year. During this period taxes were a small fraction of
what they are today.
In the decade ending with 1939, even though we continued to develop
in technological and productive knowhow, we achieved no new net increase
in production. This is the only decade in our history when production
failed to grow. And it is the decade in which we chose to divide existing
wealth, rather than to encourage the increase of wealth and opportunity
for all.
The pressure of war brought an increase in both our production and
our plant capacity, some of which could be converted to peacetime use.
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Since World War II, over 80 per cent of business investment
in plant and equipment has gone for much-needed replacement of used
up values on a current dollar basis. Our moderate growth in total
production has been due in considerable part to the fact that new
facilities are usually more efficient than those replaced. But
historically the greatest growth in total production of goods and
services, per dollar invested, comes from expansion rather than re-
placement.
In our early days, a greater percentage of progress came from
the starting of new businesses, and the expansion of small businesses,
than has been the case in recent years for a simple reason: our
federal tax system has choked off much of the potential in this area
and discouraged new business starts.
There can be no doubt that a substantial increase in total
production would follow an increase in the amount of capital which
tax reductions make available and the optimistic atmosphere of confi-
dence which tax reductions create.
I believe that under a moderate and reasonable system of rates,
we could look forward to a revival in the starting and development of
business which will improve both the quality and quantity of American
progress.
After 1930 and through the years since the beginning of the
depression, too many Americans have been more concerned with security
than with opportunity. But, out from under the yoke of harassing tax rates,
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more and more Americans would realize that opportunity is the
road to the greatest satisfaction in life and, in the final
accounting, to the greatest security.
But there still remains the question of whether the high-
level growth on which our security depends can be accomplished
without inflation.
The answer is -- it must be accomplished without inflation.
Growth must be in constant dollars if it is to be real.
I do not need to tell you how inflation cheapens your money--
increases the cost of doing business -- discourages growth and the
jobs growth creates -- and lowers the standard of living of every
man and woman who works as well as those in retirement.
There is probably no subject on which there has been more
confused and conflicting thinking than there is on the subject of
inflation -- its cause and cure.
So let me say first of all, inflation should not be confused
with prosperity, although it frequently is.
As I have said, there are some who have advocated high taxes
as a means of siphoning off consumer purchasing power in times when
the supply of money exceeded the supply of goods. It may well be
argued that leaving more money in peoples' hands by tax reduction
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automatically triggers inflation. But in the present instance,
we are talking about an increase in production. This means an
increased supply of goods. And we are also talking about
increased investment as a prerequisite to increased production,
stimulated by a new hope of the future. This puts the extra
money to work.
Inflation, authorities agree, comes about for one of two
reasons, or a combination of both.
The first is when the money supply increases faster than
the supply of goods and services on the market. This results
in costs and prices being pulled upward by the money supply.
Economists describe this type of inflation as money-pull.
The second happens when wages and other costs on an over-
all basis increase faster than overall increases in productivity.
This type is commonly known as cost or wage-push inflation.
This can produce a familiar vicious circle. Rising prices
stimulate a demand for wage increases. And, since direct and in-
direct wage costs in the long run account for the great bulk of
the total cost of production, continuing wage increases result in
cost or price increases.
In recent years, there has been some recognition of the
principle that the rate of wage increases should be related to
increases in productivity.
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Admittedly, this contention has some appeal.
However, when wage demands are predicated on this plausible
factor, it is easy for wages to be pushed up faster than actual
productivity, and when wage increases cannot be matched by pro-
ductivity increases, costs go up.
There is an intermediate stage, when wage increases are
absorbed by taking them out of profits. And there have been
wage negotiations based on a cut-into-profits principle. Some
justification for this invasion of profits might be found in a
tax philosophy based on the premise that profits are evil. But
for the same reason that we need a tax program which fosters
capital formation, a deliberate invasion of profits by wage
increases is unsound and detrimental to the nation's economic
welfare.
There has been timidity in government in facing up to the
problem of wage-push inflation because it has been 80 generally
viewed as one involving conflict between employees and management.
This is a fallacious view, since the employees' interest in avoid-
ing inflation and assuring maximum progress is fully as great as
that of management.
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Unfortunately, the unfounded charges levelled at prices and
profits has led to a toleration of wage policies which cause infla-
tion.
It is essential that we have an enlightened and accurate
understanding of the relation between wages and costs, and that
more union leaders become alert to the public interest -- which
in the final analysis is also the best interest of the men and
women who make up the union membership they are supposed to
represent.
Twenty-five years ago, the need for legislation to strengthen
the union movement and promote collective bargaining was recognized.
The underlying objective was good, and some legislation was needed.
But over the intervening years we have created in this country -- by
laws and subsequent judicial and administrative decisions -- a power
in the hands of international union bosses which, misused, can vitally
affect -- and hamper -- economic growth.
It has been frequently said that as the unions became more mature
they would become more responsible. But, human nature being what it
is, there is no more reason for believing that this will happen, than
there was for believing that the old managerial buccaneers of the turn
of the century would work in the public interest as soon as they got their
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monopolies and trusts firmly established. It took laws to solve that
problem. It is just as sensible to say that it will take laws to solve
our present problems of the accumulated powers now in the hands of
international labor union bosses.
And this, my friends, is the crux of this matter. It is a question
of power. It is not a question of putting some one in jail. We must
reach the cause -- not merely brush away some of the effects.
The powers in the hands of men who command international unions
must carry with them corresponding responsibilities. These responsi-
bilities must be insured by appropriate legislation. This is not anti-labor.
It is not anti-union. It is anti-monopolistic -- just as needed legislation
of an earlier day was anti-monopolistic in the realm of business. The
whole business community -- indeed the whole nation -- benefited by that
legislation. It is accurate to say that unionism as a whole -- and indeed
the whole nation -- will benefit by legislation which places proper limits
on the powers of union bosses.
It should be emphasized that the answers to the challenge discussed
today -- if we meet it -- and if our answer is permitted to exercise its
full impact -- will accomplish many things which union members, and all
Americans want and hope for.
It will mean more jobs, less unemployment.
It will check inflation, which affects the buying power of what
people earn, and their scale of living in retirement.
It will mean an increase in take-home pay, through progressive
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tax cuts.
It will mean sound and balanced Federal budgets because, as prosperity
increases, the tax needs of the government will be met by a smaller per-
centage of the national income than is now required.
This is, in short, an answer which holds bright hope for the future
of every American -- man, woman and child -- and sets up inspiring goals
to work for.
This program will awaken the sleeping giant of American genius and
enterprise.
But it is something more. In a world struggle between two diametrically
opposed ideologies, it is important that we, as a nation, make the most of
what we have. That is the surest way to make clear to all the bewildered
peoples of the world something which is sorely needed -- a new and dramatic
proof of the rightness and soundness and indomitable vitality of our system
of government and of our free competitive enterprise structure.
So I put this challenge before you today because it is your challenge.
It is a challenge to you, as representatives of American business. Only
if business rises to the opportunities which such a program will provide
can it be successful. It is a challenge to all the people of the United
States -- the professions -- the unions -- the people on farms -- to
mothers and fathers -- to educators -- as well as your elected repre-
sentatives in Washington. But in this, you as businessmen and outstanding
members of your community can supply a leadership which is urgently needed.
Over the years, we have developed another philosophy expressed in the
words, "Let Washington do it."
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Many businessmen have, to a considerable extent and without realizing
it, been brainwashed by demagogues who have convinced them that business and
politics don't mix, despite the fact that they are already deeply mixed.
Other businessmen have abdicated their rightful participation as
American citizens in politics and failed to understand that the party of
their choice is what they make it, either by their presence or their absence
from politics.
You have in the White House an able, a dedicated and a greatly beloved
man who must have your support, for he alone cannot solve all the problems
facing you, and he cannot be expected to do so.
You, have in Congress many men of vision and courage. But they need your
help and active support.
Gentlemen, this is your country. The government is your government.
You can offer leadership. You still have the means to support those who
espouse good government. Do it. For the hour is late. The time is short.
You might not have many more chances. Don't just sit in the wings and
complain if things go wrong. Do all you can -- and do it now -- to make
things right -- for the sake of America.
And think about this program that I've sketched out here. If it
sounds like a good one to you, then support it.
Your future, and the future of your country, may well be in your own
hands today.
(THE END)