mineral, and industrial production of the United States is now worth an aggregate of about seventy billions a year, and that in its passage from producer to consumer it generates a trade or commerce which involves an aggregate turnover of about five hundred billions annually. A tax of one per cent upon this turnover would yield a revenue of five billions a year, which is nearly twice as much as we are likely to need in the future, and a tax of one-half of one per cent would not be appreciably felt by the individual consumer, so why not levy it and be done with it?

It would collect itself, for it would only be necessary to require that every one should on the first of each month send a statement of his sales and a check for his taxes to the Treasury Department, or be prosecuted; and the buyer would hardly know that he was paying the tax, because it would be hidden in the price and absorbed in the seller's overhead charges.

Therefore I have given it up, and my mind, still seeking for some tax that would be "painless" and would not make the goose "squawk," is gradually turning toward a tax that would be levied on those who employ others to work for them as the nearest approximation to an equitably distributed consumption tax that we can obtain. I frankly admit that I am groping, but it is said that Edison tried 253 different sorts of material before he finally got a satisfactory filament for the incandescent light, and if it will not weary you I will tell you briefly my reasons for presently suggesting a tax on the priv. ilege of employing others to work for us, levied pro rata upon the amount paid them, for your consideration.

I say for your consideration, for all I can aspire to do is to stimulate thought on this all-important subject. I have no hope of being able to devise a plan that will be impeccable.

All that we consume and all wealth are, of course, the product of work. The banker's profit and the bootblack's pennies are alike the result of work. Speculation and judgment, the willingness to take risks and the ability to select and limit them intelligently, affect the reward that different men receive for doing the same amount of physical work, but these are elements that, being intangible, exempt themselves from taxation.

It all looks very simple, but let us examine it. Would it be politically possible to get Congress to pass a law taxing the farmer on what he receives for his crops? It is very doubtful. Would it be physically possible to compel the newsboy to pay a tax on the papers that he sold, or the peanut vender to make a monthly statement and send a check? Does the bootblack sell a "shine" or his labor, and would the latter be taxable? Is it freight room or By and large, the great mass of things service that we buy from the railways? that mankind consumes are the product Should either be subject to the con- of work-on the farm and in the mines, sumption tax, and should the banker factories, and offices. Therefore, if the who sells hundreds of millions of secu- labor cost of these things was taxed we rities be subject to a turnover tax should approximate an equitably disthat would break him, or be given an tributed consumption tax, and if it exemption that Congress would never were supplemented by a reasonable ingrant? come tax plus moderate surtaxes we would, it seems to me, be coming about as near as we can get to a painless and fairly apportioned tax.

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These are just a few of the questions that suggest themselves, but they make it plain that the problem is one of infinite complexity. It is probable that the goose would not squawk very loudly if he were plucked through the application of a consumption tax, but the difficult thing is to impose such a tax fairly and to make it politically acceptable.

I have given the subject much thought, and here again I must confess that I have changed my views. I do so without embarrassment, for I am one of those who believe that "a wise man changes his opinion, a fool never," and that consistency is the weakness of the narrow-minded." When the turnover tax was at first proposed, it impressed me so favorably that I advocated its adoption in an article published in The Outlook for July 14 last.

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But when I came to think out a practical plan for its collection I found that it would have to include more exceptions than are to be found in Greek grammar, and that each exception made would inspire a demand that another class be excepted, until there would be nobody left to tax.

1

I am fully aware that there are a great many exceptions that would have to be made or would, so to speak, make themselves in the application of this theory. The men and women who employed no household servants, as well as those who sold the product of their individual labor directly to the public, would be exempt, but I am inclined to think that this is desirable, for it would stimulate personal economy and industry. On the other hand, the rich man who maintained an expensive country place and employed many servants and functionaries would have to pay for the privilege.

Doubtless a tax on the privilege of getting others to work for us, levied pro rata upon the amount paid them, would lead some to reduce the daily or hourly wage and increase the bonus payments or piece work, to which the labor unions would probably object. Bonus payments, gratuities, and piece-work wages should therefore be included in the taxable disbursements.

Human nature being as it is, there will always be an effort to evade taxation, especially direct taxation that is concentrated upon a small class whose members feel that their success is penalized and that they are unjustly singled out to bear an unduly large share of the cost of government. Therefore, and without intending to be cynical or flippant, I maintain that it is more essential that a tax should be painless, that it should have a low visibility, that it should, so to speak, collect itself gradually and in small amounts, that it should not be inquisitorial, and that it should be laid upon what we spend and not upon what we earn, rather than that it should conform to the law of abstract justice, which I am convinced none of us understand or can hope to apply.

The revenue now required by the Federal Government is about five billions per annum. In round figures this is equal to about 15 cents per capita per day for every man, woman, and child in the country.

Most of us would a great deal rather pay 15 cents a day each day than $54.75 at the end of the year or on March 1 next succeeding; and just as the cashand-carry system promotes economy, so daily tax payments made through a small addition to the price of what we bought would probably stimulate thrift. The employers' privilege tax, while it would be paid directly by the farmer, the manufacturer, and the merchant, would be immediately passed on by a microscopic addition to the price of the article produced. It would therefore be almost invisible, it would be nearly painless, and it would be promptly paid in small installments from day to day or month to month.

A manufacturer or merchant whose monthly disbursements for wages, salaries, or piece work totaled $100,000 would at the end of the month send a statement to Washington with a check for the amount of his tax. If the tax were five per cent, his check would be $5,000, which he would include in his overhead charges and add to the selling price of his product.

The price paid by the manufacturer of an entirely finished or marketable product for the raw or partially finished material that he used would have been correspondingly increased by the employers' privilege tax paid upon the wages paid to those employed in its production, and thus the price at which the article was sold for consumption would include all the employers' privilege taxes that it had to bear in its progress from the first producer to the ultimate buyer.

As to the aggregate of the wages paid in this country, which would be the principal sum upon which such a tax could be levied, no definite figures are available. Roughly speaking, there are probably fifty million men, women,

and children in the United States who sell their labor, directly or indirectly. If they earn two dollars a day and work three hundred days a year, the labor income of the country is thirty billion dollars a year. This is hardly more than a guess, but if it is anywhere near correct, a tax on the privilege of employing others that would equal seven per cent on what the employer pays would probably provide all the revenue we need to offset the reduction in the excess profits and income supertaxes for which we hope.

Such a tax would be paid directly by the employers, and for the most part by the large employers. Where the work paid for produced the things that the people consume the tax would no doubt be passed on in the prices charged, and in the case of those who employed oth

ers to lessen their own toil or minister to their comfort, luxury, or extravagance, the tax could not be passed on and would act as a deterrent to unproductive expenditure.

I submit the suggestion for consideration and criticism. I realize that it is only out of the conflict of opinion that truth is evolved. There may be a great many objections to the proposed tax that I cannot see. Constant study of a single subject is apt to impair the vision.

All that I hope or can expect to accomplish is to stimulate thought upon what is our most important domestic problem, and I am certain that a satis factory solution can be found if the energies of the collective American mind are concentrated upon the same subject.

It is because I rely so confidently upon the prescience of the collective mind that I believe so confidently in the future of democracy. I mean democracy with a little "d."

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I know that there are some even in this country who are sometimes disposed to doubt that "vox populi" is vox Dei," but as I look back upon the history of this country and England and note the economic, moral, and intellectual advance that has accompanied each extension of the right to vote, my enthusiasm for government of the people, for the people, and by the people is greatly increased.

Were it otherwise, I should be of all men most miserable at a time when we are about to enfranchise the "better half" of our population, that has until recently been politically inarticulate.

A

MARION old man, in early years a political opponent but now a supporter, estimated the Republican nominee for the writer. "The trouble with Warren Harding,' said he, "is that he never had any ambition. We've had to push and pull him from one public place to another. He was never a hand to blow his own trumpet or further his own fortunes. Of course after he gets in a race he runs true to form, but he always has hesitated to start, and it was always his friends who sort of chucked him, mildly protesting, beyond the barrier.

"That is how it was when they first ran him for the State Senate. Some of us who had been dealing with him in business here for twenty years and who knew he had the levelest head and farthest sight of any man in town insisted he stand for the office. It was the same when he was proposed for the nomination for Lieutenant-Governor. Finally he said, 'Well, boys, if you think it's for the good of Marion and the party, I'll be the goat.' When they put him up for the United States Senate, he was against it. He actually had the nerve to tell some of us, privately, that he doubted if he was competent for a National place like that. Besides, as a newspaper man with a shrewd estimate of public opinion, he honestly stated and believed that he lacked the political appeal necessary to bring success to the party. But he was elected by over a hundred thousand majority and ran far ahead of his ticket.

"This Presidential nomination was forced on him in the same way. I guess

BY RICHARD BARRY those Senators in Washington associating with him for five years came to look on him just as we do here in Marionthat when it comes down to cases in any close decision on public matters he holds a little finer balance than anybody else, but that he never uses it until all the but that he never uses it until all the others are discarded. He came about as near evading the nomination as a man could under the circumstances. They say he is like McKinley, but there is one vital difference, at least. McKinley consciously and with longheaded political acumen groomed himself for at least a dozen years for the Presidential nomination. While he was Governor of Ohio he neglected the Governor of Ohio he neglected the business of the State and spent most of his time building National political fences. The exact opposite is true of Warren Harding."

In contrast is the expression of a leading citizen of Dayton, a close associate of the Democratic nominee. "Cox," said he, "is literally confident, coldly and absolutely confident, that he will be elected President next November. I don't mean this in the usual political sense. He believes in himself to a degree I never knew in any other man. Cox is accustomed to success, but he is never over-confident. You have to associate with him some time to realize what this means. He is as concretely analytical as an engineer, but he never thinks of failure, never prepares for it, never believes in it.

"If any man has raised himself by his own boot-straps, it is Jimmy Cox. If he wants a thing, he never thinks twice about getting it; he may think as often

as necessary about how to get it, but never once about the propriety or the desirability of his having it. This was characteristic of his business and professional career before he entered politics. He was forever reaching out and upward, attempting what seemed the impossible to other men, but relying solely on himself to get there, and usually doing it.

"When Cox was first nominated for Congress, it was a surprise to every one, for he was not the type we were accustomed to in public life. His personality was not known, he was a poor speaker, and he had the enmity of most of the powers that be. But coldly and alone he had made up his mind that he was going to Congress, and he went.

"In politics, as in business, he has the instinct for picking the right man (not men) for advice. In business it was Paul Sorg who became his backer and adviser. In politics he sought John McMahon, one of the shrewdest political brains in Ohio. It had been the dream of McMahon's life that his son should be a prominent office-holder, but he has never been able to do anything for his son, while it is his proud boast that he has piloted Cox to at least within a step of the White House." (McMahon is eighty-seven, Cox fifty.)

But the initiative has always come from Cox. Two years ago he told his friends he would be the Presidential nominee this time. McMahon was the only one who believed him."

In general these expressions may be fairly accepted as the estimates of

(C) Underwood & Underwood

GOVERNOR COX (TO THE RIGHT) AND "AL" SMITH, GOVERNOR OF NEW YORK. "COX IS LITERALLY CONFIDENT... THAT HE WILL BE ELECTED PRESIDENT NEXT NOVEMBER "

Marion and Dayton on their respective leading citizens. While there is a disagreement on the tenets of political faith, there must be a certain agreement on essential characteristics.

Harding is the Yggdrasil of Marion, under whose umbrageous shade pilgrims assemble for meditation and to absorb wisdom which permeates them as though from mystical sources. His strength comes as from a secret spring fed by unknown reservoirs.

There is something saga-like, something almost Oriental, about Harding's imperturbability and his seeming granite aloofness which the moment one approaches it becomes a velvet couch for reassuring revery. He looks and acts the part of and is the first patriarch. They dress his picture in a peruke and he looks like Washington. They dent in his cheeks and shade his eyes and he looks like Lincoln.

One cannot imagine Harding "running" for office. Offices and men and events just naturally have to "run" to Harding. It is like piping water down hill from a spring; gravity is a better force than the most ingenious mechanism or the most powerful pump.

These forces have been at work for a generation in that city. The writer was told that in thirty years not a measure of public enterprise has been accomplished in the community in and around Marion if Harding opposed it, while he has supported practically every one that has become a fact. This is not saying that all the business enterprises Harding has supported have been prosperous, for he told the writer himself that he could paper a room with stock certificates he held in Marion business concerns now worthless.

The Harding-Marion way has been this; unconventional, perhaps, but more

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invariable than if it were caused by a written statute. Something new is desired for the town-perhaps a bond issue to extend streets, perhaps a little capital and the incorporation for a new factory, perhaps a subscription for a country club, perhaps the extension of electric lighting to a new development. electric lighting to a new development. After the initial work of early discussion and promotion is over there always comes a time when some one asks: Well, have you seen Harding? What does he say?" Harding is always the focal point, the peak, of the promotion. This is not a financial control, for his money interests are not large, and in nothing but his newspaper dominant. It is rather the benevolent guidance of a commonly recognized community vision broader and surer than any other. Wise instigators in that locality study the approach to Harding's mind just as wise attorneys study the entrance to the Supreme Court. For if he approves the scheme, whatever it may be, it is assured of at least a try. If he withholds approval, it will fall to the ground of its own weight sooner or later. The essential point to be emphasized here is that Harding never disapproves and never opposes; he only withholds approval. No one ever heard him publicly attack any enterprise in Marion, or any individual, except in the stress of a political campaign, and then never personally.

Harding is temperamentally and by training and by lifelong experience essentially a "booster." It is almost impossible for him to say a harsh or an unkind word about anybody. His shrewd estimates of men and measures are unerring, but they are always on the sympathetic side. The writer has heard his confidential opinion of such men as Wilson, Cox, La Follette, Johnson, and others, each of whom, in differing ways,

he has at various times opposed politically. He always speaks first of his opponent's strength, and then cautiously, if at all, of his weakness. This is not with lawyer-like reserve either, but with the sang-froid and often the easy slang of the hit-or-miss newspaper man.

In the early years the office of the editor of the Marion "Star" often usurped the functions of the local police court and of the county court-house, for so many people who wanted to avoid the delays and complications of the law would by common consent submit their differences to Harding as referee, as nearly every one felt that he would give an intelligent and impartial opinion. Despite the fact that as an editor he might profit in thus gaining news of interesting differences, there was never an instance in which he did not seek to help people to patch up their troubles. Thus, unofficially, he was for long the chief magistrate of the city.

The writer asked the "Star's " Democratic competitor, the editor of the Marion "Tribune," if he would oppose Harding in this election. "Yes," he grudgingly admitted, "we will oppose him, but not very hard. People around here won't stand for it."

A similar question was addressed to the Republican editor of Cox's chief competitor, the Dayton "Herald and Journal." "We will not only fight him tooth and nail, from now until election," was the fiery answer, "but I am sure we will lick him. Cox will not carry his own county."

This feeling is the resultant of twenty years of fierce contest in the maelstrom of city journalism and politics.

Business men in Dayton, if not political enemies, have for Cox a genuine admiration as a successful man. It is the same sort of admiration they have for a cash register or a motor car or an independent lighting system for the making of which their community is celebrated. They look upon him as a unique and marvelous human mechanism which has an uncanny faculty of performing well any task to which it may be set. They were not astonished at his Presidential nomination, though few anticipated it; they have come to look upon any success which he attains as well within the man's reach. When he made his sensational charges about the Republican campaign fund, those who knew him were sure he had what he thought to be definite proof. "Cox is not a four-flusher," one Dayton manufacturer said; "he is a born prosecuting attorney; he never brings an indictment unless he thinks he can prove his case, but he never looks beyond into causes and effects. He is an expert in wrecking, and he lets the other fellow do the salvaging, while he stands by cannily ready to profit personally. if possible. In wreckage he has initiative; in salvage he is a follower."

However, in all of this feeling there

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Α A and

SI read the accounts of strikes and the shutting down of mills and factories because the market conditions do not please their owners, I tremble at the consequences if our farmers should go on a strike. Yet they have more real cause for striking than all the rest of us put together. When the possibility of an agricultural strike is mentioned, wage-earners and industrial leaders smile calmly, because they think farmers are not in position to strike and are not organized as capital and labor are organized. But the farmers are stronger in this respect than most people realize.

American agriculture is passing from the stage of personal adventure to an industry based upon modern scientific principles and engaged in for profit. The agricultural revolution now going on in America will be in its social, economic, and political significance second only to the great industrial revolution which began in England at the close of the eighteenth century and inaugurated our present economic life.

In pioneer times the farmer's life was simple and there was but little need for money. Farmers exchanged or swapped" work instead of "hiring help. The women carded and spun the wool and made the clothing. Grain was sown by hand, cut with the ancient sickle, and threshed with the flail. Corn and wheat were taken to grist mills and the miller was paid with part of the "finished product." Farmers salted down their pork and exchanged their butter, eggs, potatoes, and apples for

Brown Bros.

BY J. MADISON GATHANY

sugar, coffee, tea, and tobacco. There was no question of hours of labor. Work was done by hand and tools were simple and inexpensive. Julius Cæsar, Charlemagne, and Luther would have felt at home in the social and economic order of the farmers up to the time of the Civil War. Those were happy and bounteous days for the American farmer.

But with the introduction of steam and new machinery new problems arose. Were it not for the steamboat, railways, telegraph, telephone, etc., America would be to-day what Thomas Jefferson so ardently prayed that it would remain-a nation of tillers of the soil; there would be no exodus of laborers from the farm. But the industrial revolution almost completely changed the daily life of the American people; changed their ways of thinking and living and working. It created divisions of labor and separated the workers from their tools. Because of it the wage system arose. The financial men organized themselves for efficient service; the industrial workers organized themselves for efficient protection.

But the farmers remained unorganized. The industrial revolution has in the last few years forced the farmer to view his occupation in an entirely dif ferent light. Economic and financial pressure has caused the farmer to conclude that farming must be placed upon a commercial basis, managed for profit instead of for a mere living. All of our 7,000,000 farm owners and farm tenants have not yet come to this conclusion, but the idea is spreading like wildfire.

7,000,000 VOICES OF PROTEST

One farmer put this idea to me in these words: "The industrial and commercial men of the United States have revealed to us farmers the fundamental reasons why agriculture has been losing out in competition with other industries. First, scientific methods have not been applied to farming as much as to other industries. Second, agriculture has not benefited by efficient organization as have other industries; it has had no purchasing, sales, and advertising agencies. Third, farming has not had as ready access to credit facilities as other businesses have; this forward-looking farmers have concluded is a serious handicap. Millions of that farming can no more succeed on such a basis than any other complicated business. They propose from now on that agriculture should be managed on a strictly modern, scientific business basis that takes into consideration the cost of production and a reasonable profit.

"Farmers believe that they have been taken advantage of long enough. Until just recently they have had no effective machinery through which they could express the opinion of 7,000,000

men.

Within the last three or four years, but particularly within the last eighteen months, the cotton, fruit, grain, and vegetable growers, the sheep, cattle, poultry, milk, butter, and cheese producers, have done an amaz ing piece of organizing. You will find hundreds upon hundreds of farm county bureaus, a host of county agents, and National farm organizations by the dozens. Recently the American Farm Bureau Federation, the National voice for agriculture,' was organized. Although this Federation is only about seven months old, it already has a membership of over 1,000,000 farmers. The fee for joining it is fifty cents, which means that this farmer organization starts out with funds of nearly $500,000. For the first time the American farmer is equipping his representatives with adequate funds. The Executive Committee of the American Farm Bureau Federation has mapped out a vigorous programme. It is establishing bureaus of statistics and research, transportation, and education.

"We have raised a considerable portion of a $1,250,000 fund for the erection of the Temple of Agriculture at Washington, D. C. If Congressmen will not come to us farmers, we farmers will go to Congressmen."

There are now more than ten thousand farmer organizations in the United States. The State of Maine alone has