aper coal, etc., which will chiefly benefit the
manufacturers, since all these raw materials and services are so much
more largely used in industry than in private consumption.
Secondly, the new sources of government revenue will be used to relieve
certain older forms of taxation. The very moderately graduated income
and inheritance taxes which are now common, small capitalists have
tolerated principally on the ground that the State is in absolute need
of them for essential expenses. We may soon expect a period when the
present rapid expansion of this form of taxation as well as other direct
taxes on industry, building, corporations, etc., will be checked
somewhat by the new revenues obtained from the profits of government
enterprises and the taxation of ground values. Indirect taxation of the
consuming public in general, through tariffs and internal revenue taxes,
will also be materially lightened. As soon as new and larger sources of
income are created, the cry of the consumers for relief will be louder
than ever, and since a large part of consumption is that of the
capitalists in manufacture, the cry will be heard. This will mean lower
prices. But in the long run salaries and wages accommodate themselves to
prices, so that this reform, beneficial as it may be, cannot be accepted
as meaning, for the masses, more than a merely temporary relief. A third
form of tax reduction would be the special exemption of the poorer
classes from even the smallest direct taxation. But as employers and
wage boards, in fixing wages, will take this reduction into account, as
well as the lower prices and rents, such exemptions will effect no great
or lasting change in the division of the national income between
capitalists and receivers of salaries and wages.
A third way in which the new and vastly increased incomes of the
national and local governments can be expended is the communistic way,
as in developing commercial and technical education, in protecting the
public health, in building model tenements, in decreasing the cost of
traveling for health or business, and in promoting all measures that are
likely to increase industrial efficiency and profits without too great
cost.
A fourth way in which the new revenue may be expended, before the
Socialists are in actual or practical control, would be in somewhat
increasing the wages and somewhat shortening the hours of the State and
municipal employees, who will soon constitute a very l
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