6164 CONGRESSIONAL RECORD-SENATE APRIL 6 because of race, creed, or color in public restaurants under 3653. Also, petition of the Brooklyn Catholic Action the control of the Congress; to the Committee on Accounts. Council, Brooklyn, N.Y., recommending favorable action on 3637. By Mr. ENGLEBRIGHT: Telegrams from Cali amendment submitted by Rev. John B. Harney to section fornia, with reference to the Johnson amendment to the 301 of Senate bill 2910; to the Committee on Merchant Bankhead cotton bill; to the Committee on Agriculture. Marine, Radio, and Fisheries. 3638. Also, petition of the Richmond Chamber of Com 3654. Also, petition of L. Bernadette Schneider and merce, Richmond, Calif., protesting against the passage of others, voters of the Third Congressional District of New the Fletcher-Rayburn stock-exchange control bill; to the York, favoring amendment proposed by Rev. J.B. Harney to Committee on Interstate and Foreign Commerce. section 301 of Senate bill 2910; to the Committee on Mer 3639. By Mr. FULMER: Resolution of the Charleston Re chant Marine, Radio, and Fisheries. tail Merchants Association, of Charleston, S.C., favoring the 3655. Also, petition of William R. Warner & co. Inc., enactment of the Pettengill bill, and " respectfully urging New York City, protesting against the increased tax on non our Senators and Congressmen to work for the passage of beverage alcohol used in the manufacture of medicinal this bill at this session of Congress"; to the Committee on products: to the Committee on Ways and Means. Interstate and Foreign Commerce. 3656. By Mr. PERKINS: Petition of residents of Warren. 3640. By Mr. GOODWIN: Petition of Rev. J. B. Conroy, Hunterdon, and Bergen Counties of the State of New Jer pastor St. Johns Church, Clove, Ulster County, N.Y., in sey, petitioning Congress to act at once to safeguard the behalf of 150 members of his church, requesting the support inherent rights of the American people relative to the radio; of the amendment to section 301 of Senate bill 2910 provid to the Committee on Merchant Marine, Radio, and Fish ing for the regulation of interstate and foreign communica eries. tions by wire or radio, and f m" other purposes; to the Com 3657. Also, petition of the Senate of the State of New mittee on Interstate and Foreign Commerce. Jersey H.R. 6179. An act to amend an act entitled "An act to VOCATIONAL AVIATION COURSES IN PUBLIC SCHOOLS provide for the leasing of coal lands in the Territory of Mr. WALSH submitted the following resolution (S.Res. Alaska, and for other purposes "; 220), which was referred to the Committee on Ed1.1cation H.R. 7306. An act to amend section 10 of the act entitled and Labor: "An act extending the homestead laws and providing for Resolved, That the Commissioner of Education in the Depart right-of-way for railroads in the District of Alaska, and for ment of the Interior is requested to make a study of the desir other purposes", approved May 14, 1893, as amended; and ability of including in the curricula of the public schools through out the United States vocational courses in aviation and related H.R. 7425. An act for the inclusion of certain lands in the subjects, formulate a plan for such courses of study, make the national forests in the State of Idaho, and for other pur results of such study and such plans available for use of the poses; to the Committee on Public Lands and Surveys. schools and the people throughout the United States, and make H.R. 7428. An act providing for the transfer of certain a report with respect to such study and plans to the Congress. lands from the United States to the city of Wilmington, CLAIMS OF TURTLE MOUNTAIN BAND OR BANDS OF CHIPPEWA Del., and from the city of Wilmington, Del., to the United . INDIANS States; to the Committee on Public Buildings and Grounds. The VICE PRESIDENT laid before the Senate the amend H.R. 5038. An act authorizing pursers or licensed deck ment of the House of Representatives to the bill (S. 326) officers of vessels to perfarm the duties of the masters of i·ef erring the claims of the Turtle Mountain Band or Bands such vessels in relation to entrance and clearance of same; of Chippewa Indians of North Dakota to the Court of H.R. 8429. An act to revive and reenact the act entitled Claims for adjudication and settlement. "An act authorizing D. S. Prentiss, R. A. Salladay, Syl F. Mr. FRAZIER. I move that the Senate disagree to the Histed, William M. Turner, and John H. Rahilly, their heirs, amendment of the House, ask for a conference with the legal representatives, and assigns, to construct, maintain, House on the disagreeing votes of the two Houses thereon, and operate a bridge across the Mississippi River at or near and that the conferees on the part of the Senate be ap the town of New Boston, Ill.", approved March 3, 1931; pointed by the Chair. H.R. 8438. An act to legalize a bridge across St. Francis The motion was agreed to; and the Vice President ap River at or near Lake City, Ark.; pointed Mr. AsHURsT, Mr. THOMAS of Oklahoma, and Mr. FRAZIER conferees on the part of the Senate. H.R. 8853. An act to extend the time for the construction of a bridge across the Wabash River at a point in Sullivan GOVERNMENTAL CONTROL OF BUSINESS County, Ind., to a point opposite on the Illinois shore; and Mr. PATTERSON. Mr. President, I ask unanimous con H.R. 8516. An act granting the consent of Congress to the sent to have inserted in the RECORD an editorial appearing Mississippi Highway Commission to construct, maintain, and in the St. Louis Globe Democrat of March 15, 1934, entitled operate a free highway bridge across the Pearl River in tbe " Governmental Control of Business ", in which the Fletcher State of Mississippi; to the Committee on Commerct!. Rayburn stock-exchange control bill is very ably discussed. H.R. 4808. An act granting citizenship to the Metlakahtla There being no objection, the editorial was ordered to be Indians of Alaska; and printed in the RECORD, as follows: H.R. 7549. An act to modify the effect of certain Chippewa [From the St. Louis Globe Democrat, Mar. 15, 1934] Indian treaties on areas in Minnesota; to the Committee on GOVERNMENTAL CONTROL OF BUSINESS Indian Affairs. In giving his approval to the revised Fletcher-Rayburn stock H.R. 6898. An act authorizing the city of Atchison, Kans., exchange bill President Roosevelt said the two principal objectives were margins so high that speculation would be drastically cur and the county of Buchanan, Mo., or either of them, or the tailed, and giving the Government such powers of supervision over States of Kansas and Missouri, or either of them, or the exchanges that it will be able to correct abuses which may arise highway departments of such States, acting jointly or sev in the future. With the effort to prevent excessive speculation erally, to construct, maintain, and operate a free highway such as we had in 1928-29 there can be no serious quarrel, but this bill, even as modified, goes to e:ictremes in regulation that will bridge across the Missouri River at or near Atchison, Kans.; make it detrimental to the legitimate operations of the securities and markets and consequently an impediment to economic recovery. However, the chief objection to this bill 1s the bureaucratic H.R. 7200. An act to provide for the addition of certain control it would give over the organized business of the country. lands to the Chickamauga and Chattanooga National Mili The President in his letter to Senator FLETCHER did not mention tary Park in the States of Tennessee and Georgia; to the this feature of the bill, and we doubt that he has given serious consideration to it. He said in this letter, "the bill as shown to calendar. me by you this afternoon seems to meet the minimum require H.R. 1766. An act to provide medical services after retire ments." The plain inference is that Senator FLETCHER took the ment on annuity to farmer employees of the United States bill to the White House and that he and the President discussed disabled by injuries sustained in the performance of their it for a brief time, with but little, if any, attention given to the business-control provisions, for the whole of the President's re duties; marks refer to supervision over exchanges. H.R. 7356. An act to provide, in case of the disability of Yet this bill provides not merely for supervision over exchanges senior circuit judges, for the exercise of their powers and but for governmental supervision over virtually every incorporated business in the country, directly and specifically over every con the performance of their duties by the other circuit judges; cern whose stock is listed on any exchange, and indirectly over and every other concern whose stock is not listed, a control that may H.J.Res. 10. Joint resolution requesting the President to also become direct when the provisions of the law are carried out. Under th~s bill every corporation whose securities are listed must proclaim October 12 as Columbus Day for the observance of file an agYeement with the Federal Trade Commission to comply the anniversary of the discovery of America; to the Commit with all the terms of the act "and any amendments thereto, and tee on the Judiciary. with the rules and regulations made or to be made thereunder" by the Commission, thus binding it not only to whatever is but INTERNAL-REVENUE TAXATION-AMENDMENT to whatever may be in the future required by the law or the Commission. And it must supply at once to the exchange and the Mr. METCALF submitted an amendment intended to be Commission not only information as to its financial structure proposed by him to the bill LXXVm·~9Q 6172 _CONGRESSIONAL RECORD-SENATE APRIL 6 Mr. REED. I do not think it is a question so much of Mr. BLACK. Suppose we assume that the profit had ac- encouraging or discouraging the transaction in the case of crued in past years; what difference does it make, insofar the short-term profit, but the philosophy is that a specu- as the tax is concerned, if there had been no tax paid on lative profit from a purchase last week and a sale this week the gain for the previous years? That is the point at which is not in any sense an investment transaction. A man en- I am trying to arrive. gaged in that kind of dealing is trading in property in order Mr. MURPHY. There is no tax paid for the previous to obtain a speculative income out of it, just as dealers on ~ears, except on 30 percent of the gain at sale, if the asset the New York Stock Exchange will buy and sell thousands is held over 10 years. of shares in a day and wind up all even, so far as shares go, In an emergency tax measure to raise revenue we are in but with a money profit. That is income in every sense of the position of saying to the taxpayer, "Do not sell your the word, whereas in the case of a man who bought a asset this year. If you do you will have to pay on 100 per dwelling house to live in 20 years ago, who sells it now for cent of the profit. Do not sell it next year; if you do, you some reason-perhaps because he has to-if he makes a will have to pay on 80 percent of the profit. Do not sell it gain, he is not making a speculative gain in any sense. The 3 years from now; if you do you will have to pay on 60 transaction was not entered into for profit at all. To clap percent of the profit. Do not sell it short of 5 years; if you on that man a very high surtax rate, as if that were a con- do, you will have to pay on 40 percent of the profit. Hold stant investment income coming to him, would be the height it for 10 years, and then you will have to pay on only 30 of injustice. percent of the profit." Mr. BLACK. Mr. President, may I ask, however, if this is Mr. President, as I said yesterday, it is obviously absurd not a correct statement? If this amendment should be to expect this measure to produce revenue when we offer an agreed to in its present form-and I thoroughly approve of inducement to the taxpayer to hold on to the asset and not an increase above the 12¥2 percent-it would result in tax- sell it, that inducement being a guaranteed reduction in ing the man who had owned stocks 10 years on a basis of 40 his tax. percent of his profit, and the man who had owned stocks 2 We are also indulging the presumption that there ought years on 100 percent of his profit. to be relief. To whom has that relief gone in the years dur- Mr. REED. No; not quite that. If the Senator will refer ing which we have had the capital-gains tax? We never to the schedule, he will see that it is different from that. had the capital-gains tax until Mr. Mellon became Secretary Mr. BLACK. Whatever the schedule is, if I am incorrect of the Treasury. Beginning with 1922, when the 12%-per in the figure as I heard it read a moment ago for the first cent rate took effect, from 70 to 80 percent of all such gains time, if the amendment shall pass in its present form the have been on incomes of $100,000 or more. result will be that the man who has held his stock for 10 The total of capital gains reported by all taxpayers in the years will pay a smaller amount of tax on his actual gain 5 years from 1925 to 1929 was $7,137,000,000, and of that than will the man who has held it for only 2 years. $6,048,000,000 was in returns showing incomes of more than Mr. REED. That is exactly correct. The more specu- $100,000. lative the transaction, the larger the tax the individual pays. The tax revenue lost to the Government by reason of that The VICE PRESIDENT. The question is on agreeing to 12%-percent provision in its departure from what had been the amendment offered by the Senator from Iowa [Mr. the law up to 1921 was $750,000,000. MURPHY]. Now, we continue to treat these capital gains preferen- Mr. MURPHY. Mr. President, the Senator from Alabama tially. They are the gains of the rich, the very rich. They [Mr. BLACK] has unwittingly referred in his remarks to the are habitual with them. There has been interpolated here amendment, whereas he meant his reference to be to the-· something about a man who has held a homestead and sold pending bill. The pending amendment was offered by me. it, as though he were the factor in the equation. This re- Mr. BLACK. Mr. President-- lief goes in far greater part to the very rich taxpayers, to The VICE PRESIDENT. Does the Senator from Iowa the taxpayers having incomes of over $100,000. yield to the Senator from Alabama? I conceded yesterday in my discussion that the provision Mr. MURPHY. I yield. in the pending bill is a large improvement over the 12%- Mr. BLACK. I was referring to the Senate committee percent provisio~ but my amendment does not indulge the amendment. I understood that the Senate committee had presumption this bill does. It ascertains how long the tax amended the bill as sent over by the House. If the Senate payer has held the asset, and that is a factor. It determines committee had not amended the feature under discussion, also whether or not the gain is extraordinary; meaning by then my reference applies to the original House provision. extraordinary that we determine whether or not he had Mr. MURPHY. Yes. Mr. President. the Senator from other capital gains in those years, and if he did we extend Pennsylvania has stated that the presumption is indulged relief to that amount from capital gains that represents an that the capital gains accrue through the years. The pro- excess over what has ordinarily been received by him in the vision in the committee bill makes no effort to determine 5 years from other capital gains. whether or not the gain in the asset has accumulated Mr. LA FOLLETTE. Mr. President-- through the. years. The PRESIDING OFFICER. Does the Senator from Iowa · Acting on the assumption that the gain has so a.ccumu- yield to the Senator from Wisconsin? lated, it proceeds to give relief in a measure designed to be Mr. MURPHY. I yield. an emergency tax measure to produce revenues for the im- Mr. LA FOLLETTE. If I understand the Senator's mediate needs of Government. It says to the taxpayer, "If amendment correctly, it would take care of the situation of you sell your asset this year, you will have to pay on 100 the man who had invested in a home and at the end of a percent of the profit. If you do not sell your asset until period of time realized an exceptional income on the value after you have held it a year, and not longer than 2 years, of the property. you will be forgiven from tax 20 percent of that profit; if Mr. MURPHY. It takes care of him. My amendment from 2 to 5 years, 40 percent of that profit; if from 5 to 10 carries out mathematically the principle stated in the House years, 60 percent of that profit; and if more than 10 years, committee report. The committee bill abandons it. The 70 percent of the profit.,, We are forgiving profit on the committee bill just reaches out of the air and bestows for assumption that such profit accrued in each of the years giveness of these stated percentums without any mathemati in which the asset was held, although there is absent any cal basis. proof that it did accrue in each of the years it was held. My amendment gives mathematically accurate effect to Mr. BLACK. Mr. President-- the House committee principle. The PRESIDING OFFICER (Mr. MCKELLAR in the chair) . The objection made to my amendment by the Chairman Does the Senator from Iowa yield to the Senator from of the Finance Committee is that it is difficult of adminis- Alabama? tration. I grant that to be so; but we have seen that this Mr. MURPHY. I yield. tax applies on incomes above $100,000 in very much the 1934 CONGRESSIONAL RECORD-SENATE 6173 largest part, and ·1 think It safe to assume that every man rate of a different amount upon the profit or gain or income with an income of $25,000 employs a tax expert to make out he receives. So, assuming that the amendment of the Sen his return. ator from Iowa more nearly approaches the idea of an equal There is provision in my amendment perm1tting the Sec basic rate for all profits and income and gains made, I shall retary of the Treasury to prescribe regulations. I submit very cheerfully vote for his amendment. we can afford to have something that is a little difficult of Mr. President, I merely wanted to make that statement, ad.ministration when the clarified method of ad.ministration because I am not fully familiar with the amendment as cost the Government in the 5 year.s, 1925 to 1929, inclusive, written, but I have heard enough this morning to be familiar $750,000,000 in taxes. with the object and purpose of the amendment. I regret The PRESIDING OFFICER. The question is oii the not to vote with the committee on its amendment, but I amendment of the Senator from Iowa [Mr. MURPHYl. myself cannot believe that it is right to have one basic rate Mr. REED. Mr. President, I want to say only a word. for the profits and gains made by a citizen simply because The Joint Committee on Internal Revenue Taxation worked he has held an investment for 1 year and another basic over 5 years before it was ready to adopt the system adopted rate for the profits and gains made by a citizen who has by the House bill and the system recommended by the held it for 10 years. As a matter of fact, I think the rate Finance Committee. It may be that the amendment of the should be the same for the income which comes from a. Senator from Iowa is an improvement over the recommenda salary, if that be included in the normal income, from all tion of the joint committee, but certainly it should be other gains and from all other profits, and I can see no studied before being adopted. It ought to be studied by the reason in the world why a preferential rate should be given experts and analyzed in the way the other proposals have, to those who happen to have gotten their income from and I hope it will not be adopted without such study. trading on the market or at any other place. So far as I Mr. LA FOLLETTE. Mr. President, I wish to say only a am concerned, I would prefer the Senator's amendment to few words in support of the amendment offered by the provide no exceptions and no exemptions of any kind, but Senator from Iowa. I do not think any Senator could listen that the rate should be the same for the profits or the to the statement of facts which the Senator from Iowa made gains for those who have made such profits or gains over a on yesterday afternoon in support of his amendment with period of 1 year or over a period of 10 years. I join with out being convinced that the amendment seeks to close one the Senator from Wisconsin in hoping that we may have of the largest loopholes in the present tax system, and, in a record vote upon the amendment. my opinion, seeks to close it by a substitute method which Mr. SHIPSTEAD. Mr. President, I rise to obtain some is entirely equitable. information. It was not possible for me to be present and I recognize that the amendment appears upon its face to to hear all the debate on this amendment. As I under be complicated and that it is held by some to be diffi.cult of stand now, the other House reported a provision establish ad.ministration; but are we not justified in attempting to ing the principle involved in the amendment of the Senator employ a new method, even though it may be more dim.cult from Iowa. Is that correct? Did the House bill contain a of ad.ministration than that contained in the proposal of the provision similar to this in character? What is the dis Finance Committee, in order to close this loophole in our tax tinction between this amendment and the provision of the system and in order to withdraw the special privilege which House bill? has been extended to the large income-tax payers in past Mr. LA FOILETTE. Mr. President, it is my understand years? ing that the House Ways and Means Committee did not follow the recommenda.tion of the subcommittee which The Senator from Iowa, in the course of his career, has studied the question of the tax system. The House Ways been connected with the Internal Revenue Department; he and Means Committee reported and the House adopted the is familiar with the procedure of that Department and with principle contained in the amendment reported by the the administration of the law. He has devoted a great deal of time and attention to the consideration of this important Senate Committee on Finance. All that the Senate Com question. I appeal to the Senate to adopt this amendment mittee on Finance did to the House text was at the sugges tion of the Senator from Pennsylvania tMr. REED] to pro and to permit it to go to conference, where it may have vide an additional bracket covering gains from assets held further study of the experts representing the Joint Commit over a longer period. In principle, however, the provision tee on Taxation and the Treasury Department. in the House bill is the same a.s the amendment reported The Senator from Pennsylvania has referred to the ex by the Senate Committee on Finance. perts of the Joint Committee on Taxation and their recom Mr. SHIPSTEAD. The Senator speaks of the subcom mendation. I hold Mr. Parker and his staff in the highest mittee that considered the problems of taxation. Did they estimation. Nevertheless, the subcommittee of the Commit consider the proposition that was offered by the Joint Com tee on Ways and Means, in conjunction with its experts, mittee on Taxation of the House and the Senate? gave a great deal of study to this problem and reported, in Mr. LA FOLLETTE. I cannot answer that question. All principle, in support of the amendment which has been I know is that the subcommittee of the Ways and Means offered by the Senator from Iowa. Committee reported, in principle, the amendment along the I hope, Mr. President, that we may have a record vote lines the Senator from Iowa has offered, but the Ways and upon this amendment, and I sincerely trust that it may be Means Committee did not follow that recommendation, and adopted. adopted the provision which is before the Senate, with the Mr. BLACK. Mr. President, I am not familiar with this exception of the additional bracket which was proposed in amendment and I merely want to explain the vote I shall the committee by the Senator from Pennsylvania. cast. Unfortunately, I did not have the privilege of being Mr. REED. Mr. President, I can answer the question of here yesterday afternoon. I did not know that this matter the Senator', if he wishes me to do so. had been discussed; so my entire information has come Mr. SHIPSTEAD. I will be glad to hear the Senator. since I reached the Senate fioor. Mr. REED. The subcommittee of the Ways and Means As I view this amendment, however, in its intendment and Committee followed the recommendation of the Joint Com purpose it raises a question of policy. I cannot see why mittee on T~ation, and recommended the provision which there should be any of the tax forgiven one man that is not the Senator finds in the House bill, plus an additional forgiven another. I cannot understand that there have bracket carrying 20 percent of the gain or loss if the asset been suffi.cient arguments advanced to justify the belief that had been held over 10 years. The Ways and Means Com it is necessary to encourage long-time investments. I can mittee dropped out that final bracket. We restorea it at not distinguish between a profit or a gain made by a man 30 percent, instead of 20 percent, as recommended by the over a period of 1 year and over a period of 10 years if the subcommittee of the Committee on Ways and Means. man gets the gain. I do not see why it is fair for one citizen Mr. SIIlPSTEAD. Then this is an entirely new proposi to pay a tax upon one basic rate upon the profit or the gain tion? or income he receives and for another citizen to pay a basio· Mr. MURPHY. Yes. 6174 CONGRESSIONAL RECORD-SENATE APRIL 6 Mr. REED. The amendment of the Senator from Iowa the most glaring special privileges that has bzen extant is an entirely new proposition? under our income-tax system. Mr. SHIPSTEAD. What has been the objection offered Mr. GEORGE. Mr. President, the difficulty involved in to this amendment? The only objection I have heard is the the amendment grows out of the capital gains provision in statement that it may be difficult of administration. our income tax law. It arises out of this fact. If one is to Mr. M""uRPHY. That is the only objection I have heard, be taxed on his gains, there is much equity and justice in I will say to the Senator. saying that he should be allowed to deduct his losses. That Mr. LA FOLLETTE. The reference which I had in mind is all right; but we have found from experience that when a moment ago is as follows-and I quote from the speech ' taxpayer A, who is engaged in the buying and selling of of the Senator from Iowa on page 6101 of the RECORD of securities for himself, primarily investing his own money, yesterday: by reason of the fact that he can so easily create a loss or The House subcommittee on tax revision, in presenting the at least take advantage of a loss within the taxable year, plan embodied in this bill, stated admirably the principle on and wipe out his tax liability to the Government, that the which relief might properly be based. It said: c h "The tax on a capital gain should approximate the tax which ongress as come around finally to the view that losses would have been paid if the gain had been real ~zed in equal except to a limited extent are not to be allowed the tax- annual amounts over the period for which the asset was held." payer. That is the simple proposition. I contend that that is, in principle and in essence, the In the bill now before us, losses are not to be allowed the proposition contained in the amendment offered by the taxpayer; that is, he cannot deduct his losses from his Senator from Iowa, and that the House Ways and Means gross income for the purpose of ascertaining net taxable Committee did not fallow the recommendation, in principle, income unless the loss is incurred in the same business or made by the subcommittee. It modified the existing prin- operation; nor can he carry over the loss, however incurred, ciple by providing these various brackets, which provision I to the next succeeding year. concede, as did the Senator from Iowa yesterday, is an im- In other words, under the theory of the bill all capital provement over the existing law; but it does not carry out transactions are put into one hopper, and in the revolutions the recommendation contained in the statement of the sub- through which they pass during the year, if the gains are committee of the House Committee on Ways and Means as offset by losses in a particular business in which the tax quoted by the Senator from Iowa yesterday. payer is engaged, he may have the advantage of his losses Mr. REED. Mr. President, will the Senator from Minne- against his gains; but if that particular taxpayer has a salary sota yield to me? of $20,000 and he has losses on his business operations of Mr. SHIPSTEAD. I yield the floor. $40,000, he cannot deduct those losses so as to def eat his Mr. REED. The recommendation of the subcommittee of tax or reduce his tax on the salary except to a very limited the Committee on Ways and Means appears on page 6 of extent as provided by the committee, because he can only their printed report. They recommend that: get the advantage of the losses on the business in which he To measure the gain or loss from the sale of property by an had the gain; nor can he carry over those losses beyond the individual according to the length of time he has held the prop year. erty, the following percentages of gain or loss are recognized for Now we have this proposition, and this is the philosophy tax purposes: and the reasoning under this provision. If we are not going One hundred percent if the capital asset has been held for not more than 1 year; to allow the taxpayers the benefit of capital losses, how Eighty percent if the capital asset has been held for more than may we in equity tax his capital gain? The bill undertakes 1 year but not more than 2 years; to soften the tax on the capital gain. Bear in mind, we Sixty percent 1f the capital asset has been held for more than 2 years but not more than 3 years; have taken away from him his losses, we have disallowed his Forty percent if the capital asset has been held for more than losses except for the one year upon the same business in 3 years but not more tb::tn 5 years; which he had the gain, and yet we hold him to his capital Twenty percent if the capital asset has been held more than gain for the first year, 100 percent of the gain, and then we 5 years. graduate it downward depending upon the length of time he The Ways and Means Committee adopted that recom has held the particular asset. mendation, but left out the last bracket of 20 percent if the Whether the philosophy of the provision be right, whether capital asset has been held more than 5 years. When the the equity be one that can be defended wholly, it grows out bill came to the Finance Committee, I moved to add an addi of that particular situation; that is, having denied the tax tional bracket, namely, 30 percent if the asset had been held payer the right to take capital losses we are going to tax him over 10 years. on capital gains, but we are going to soften the blow to The Senator will see the three successive recommenda him by permitting him to pay on a less and less income from tions, all adopting the same principle, and that the Finance the capital gain measured by the length of time he has held Committee has taken a position midway between the sub the capital asset. committee of the Committee on Ways and Means and the Personally I believe we would have a much simpler full committee. I might add parenthetically that the Joint income-tax system if we could get rid of the capital-gain Committee on Internal Revenue Taxation made a recom and-loss theory altogether. But we have not gotten rid of mendation which was the same as the schedule of the sub it, and we are not going to get rid of it. I realize that there committee which I have just read. The Finance Committee is difficulty in getting rid of the capital-gain tax, particularly did not go so far as the joint committee and did not go so at a time when we have low values, because we are always far as the subcommittee. trying to get the taxpayer to pay more money into the Mr. LA FOLLETTE. Mr. President, the only inaccuracy Treasury. But the question is academic, as I see it. We in the statement I made a while ago was to the effect that have the capital gain. We are going to continue the tax the full Ways and Means Committee did not follow the on capital gain, but we have now practically wiped out recommendation of the subcommittee. The fact is that capital losses. We have restricted them greatly to 1 year. the subcommittee itself did not carry out the principle The Ways and Means Committee of the House and the which it recommended in its report. No Senator can study House itself undertook to soften the blow on the taxpayer the matter and successfully contend that either the House who was required to pay the tax on his gain, but not per text or the Senate committee text carries out this statement of principle, namely, that the tax on a capital gain should mitted to take losses. approximate the tax which would have been paid if the Mr. MURPHY. Mr. President-- gain had been realized in equal amounts over the period The PRESIDING OFFICER. Does the Senator from for which the assets were held. This is precisely what the Georgia yield to the Senator from Iowa? amendment offered by the Senator from Iowa does. If it Mr. GEORGE. I yield. shall be put into the bill and becomes law, in my opinion, it Mr. MURPHY. I desire to say to the Senator that my will go a long way to increase revenue and to cure one of amendment does not disturb the capital-loss features of tha I • 1934 CONGRESSIONAL RECORD-SENATm 6175 bill. They are retained. My amendment applies only to his capital gains, it is hard to answer why, in justice and subtitles A and B of the bill. equity, he is not entitled to take off his capital losses. All Mr. GEORGE. I so understand; and I want to make that this provision does is to recognize the harshness of that this statement about the Senator's amendment. The amend rule and to soften the blow on the taxpayer who must con ment impresses me as having considerable merit, but it is tinue to pay on his capital gains while he is denied the right rather technical; that is, the application of it would prob to deduct his capital losses. That is the reason for it. ably be difficult. It might not be as difficult as it seems to I have no hesitancy in saying that I think the capital me to be. But under the Senator's amendment, if it were gains and loss provision should be written out of our revenue now adopted, the chances are we would get no more revenue laws, just as Great Britain has written it out of her system. immediately, and perhaps not so much as we would under I know the argument against it; but, at the same time, if the bill as it stands, for this reason, if the Senator will we are going to impose a tax on the gains, it is difficult for permit me: The bill as it stands taxes the capital gain 100 me, at least, to submit any sincere argument against allow percent if realized during the first year that the capital ing a deduction for the losses. We have minimized the assets out t>f which they arise are sold. Capital assets which losses of the taxpaye1·s; we have virtually stripped him of have been carried during the depression are not likely to be the right to take losses, and we have said, "We will tax you sold within the next year. 100 percent on your gains if realized within 1 year," grad The Senator has made a contribution which I think the uating the tax down if realized over a longer period of time. committees of the two Houses ought very carefully to con What the Senator says may be true, that an incentive will sider; and if it is not too complicated, not too technical, it be given the taxpayer to withhold the sale of his security or might well become a part of our law. I am not making an property during the first year over to the second, third, argument against the merits of the Senator's amendment. fourth, fifth, or even eighth year in order to escape a greater I believe we shall have an opportunity to insert the amend part of the burden of the tax. That may be true. That ment, if it can be demonstrated that it is not too technical, argument may be made against any capital-gains tax; and in another tax act before very many of the transactions that is the argument which has prevailed generally with which would fall under it actually take place, resulting in those countries that have discarded the capital-gains tax. profit to the taxpayer. They have looked to the long run; and they have believed, Mr. MURPHY. Mr. President, will the Senator yield? at least, that the best taxing system was the one that left Mr. GEORGE. I yield to the Senator. intact the industrial and the commercial and the financial Mr. MURPHY. I thank the Senator for his references to structure of the country, so that it might continue to earn the amendment I have offered. I should like to make one an income upon which a tax could be imposed. observation, however, in reply to his remarks. There is no quarrel with the essential purpose the Senator I think the bill as drawn is very likely to defeat revenue has in mind in his amendment. The difficulty we had in in its encouragement to the taxpayer to hold off sale. The considering his amendment was whether or not it was simple tax of 100 percent on the profits realized in the current or enough, whether or not it could be applied, because it seemed taxable year is a tax that will fall very largely on the to be highly technical; and our advice was that it could be speculative profits in the stock market. The capital-gains applied, if at all, with a great deal of difficulty. Probably tax, in its relief provisions, will affect the investment for during the life of this tax bill, because this will not be a the long pull. long-lived tax bill-there is going to be another one-prob We have had since last June an average advance in stocks ably during the life of this tax bill the capital gains will be of 100 percent. Of course, we are assured an advance of taxed 100 percent anyhow. So there is not any practical another 100 percent under this administration within the reason for taking the amendment suggested by the able next year. Stock bought last year, which has already ad Senator, even though it should turn out to be simple in vanced 100 percent, if sold last year with 100 percent ad administration, contrary to what we now think, because we vance, would be taxed on the basis of 100 percent of that shall have an opportunity to take it again, in my judgment, gain. If not sold until this year, it will be taxed on 80 per after mature study, before another year passes. ·cent of the gain. If sold within 2 and 5 years, it will be Mr. President, I merely wished to make this statement, taxed on 60 percent of the gain. If not sold for more than not in justification of this particular provision in the bill, 10 years, it will be taxed on only 30 percent of the gain. because frankly it is a crude way of meeting a bad situation It seems to me, Mr. President, that we are holding out which grows out of the decision upon the part of the Con encouragement to the taxpayer not to sell. We are holding gress to tax capital gains but to deny capital losses, because out to him the promise of a reduced tax, depending upon we have learned from experience that through capital losses how long he holds the asset. Certainly, unless necessity the big taxpayers are able to escape liability for taxes. COJllpels, I am not going to sell an asset on which I have a The PRESIDING OFFICER (Mr. O'MAHONEY in the profit within 10 years if I have any assurance of a profit chair). The question is on the amendment of the Senator then, because by holding it over 10 years I will have to pay from Iowa [Mr. MURPHY]. a tax on only 30 percent of the profit; and I think that will Mr. MURPHY. I call for the yeas and nays. operate to def eat the collection of revenue. Mr. McNARY. I suggest the absence of a quorum. It is a very significant fact that in 1922 there were about The PRESIDING OFFICER. The absence of a quorum $3,200,000,000 of stock dividends issued; and 2 years later, being suggested, the clerk will call the roll. or on the very earliest date when those stock dividends could The Chief Clerk called the roll, and the fallowing Sena be sold and get the benefit of the 12%-percent tax, there tors answered to their names: was a tremendous increase in the realization of gains on Adams Duffy La Follette Reynolds capital assets. In this bill we continue the encouragement Austin Erickson Lewis Robinson, Ark. Bachman Fess Logan Robinson, Ind, to corporations to build up their surpluses. We say to them, Bailey Fletcher Lonergan Russell in effect," Do not pay out the earnings in dividends to stock Bankhead Frazier Long Sheppard Barkley George McAdoo Shipstead holders. Build up surpluses, and issue stock dividends "; Black Gibson Mc Carran Smith and we say to the stockholder, "If you hold that stock divi Borah Glass McGill Steiwer dend for more than 2 years ~ou will have to pay a tax on Brown Goldsborough McKellar Thomas, Okla. Bulkley Gore McNary Thomas, Utah only 40 percent of it. If you hold it over 10 years, you will Bulow Hale Metcalf Thompson have to pay a tax on only 30 percent of it." Capper Harrison Murphy Townsend Caraway . Hastings Neely Tydings I submit, Mr. President, that there is not anything demo Carey Hatch .Norris Vandenberg cratic in that proposal. I submit that that is privilege legis Clark Hatfield Nye Van Nuys lation, drawn to benefit the long-pull stockholder. Connally Hayden O'Mahoney Walcott Couzens Hebert Overton Walsh Mr. GEORGE. Mr. President, I submit that the Senator Davis Johnson Patterson White is entirely wrong. The provision in the bill is based UPon Dickinson Kean Pittman Dieterich Keyes Pope the simple proposition that if we are going to tax a man on nw King Reed 6176 _CONGRESSIONAL RECORD-SENATE APRIL 6 The PRESIDING OFFICER. Eighty-one Senators hav The motion was agreed to; and the Presiding Officer ap ing answered to their names, a quorum is present. pointed Mr. BULKLEY, Mr. BARKLEY, and Mr. TOWNSEND The PRESIDING OFFICER. The question is on agree conferees on the part of the Senate. ing to the amendment offered by the junior Senator from INTERNAL-REVENUE TAXATION Iowa [Mr. MURPHY]. The Senate resumed the consideration of the bill these companies thought their depletion allowances were J Mr. McKELLAR. I said that the House disregarded the going to be stopped, their representatives came here to suggested amendment of the Secretary of the Treasury, Washington, where the companies have one of the greatest which was not to strike it all out, but to reduce this per lobbies known in our city-and, as the Senate knows, there fectly enormous allowance of 50 percent of the net profits. are some great ones here-and offered this section, which I Why should any company come to the Congress and say ask to strike out: to it, as these companies do," It is true that we have all the (3) Percentage depletion for oil and gas wells: In the case of allowances that every other corporation in the country has, oil and gas wells the allowance for depletion under section 23 (m) but we want an additional allowance. We_ want one half shall be 27Y2 percent of the gross income from the property during of all our net income exempted as depletion allowance", the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred by the taxpayer after they have heretofore taken up all of their depletion in respect of the property. Such allowance shall not exceed 50 allowance? percent of the net income of the taxpayer (computed Without Mr BARKLEY If th S to • elm t h uld b allowance for depletion) from the property, except that in no · · e ena r S amen en s O e case shall the depletion allowance under section 23 (m) be less agreed to, it would practically eliminate the allowances for than it would be if computed Without reference to this paragraph. depletion in the case of oil and gas wells. Mr. President, I desire now to call attention to the allow- Mr. McKELLAR. Not practically, but-- ances generally to which these corporations would be Mr. BARKLEY. Entirely so. entitled. Mr. McKELLAR. It would give the oil and gas companies For instance, there is the allowance for compensation of exactly the same allowances or credits that every other officers. As an illustration of what that was in any one year corporation in this country has. I will take the year 1930, and the Senate will see what al- Mr. BARKLEY. Does not the Senator think there is any lowances are made on that score. By the way, I have an difference between an oil company that brings in a well, or amendment following this which will undertake to take a few wells, which soon are entirely exhausted, and an ordi- care of that situation to some extent. nary company that is engaged in some other business? - The allowance to officers by the corporations of America Mr. McKELLAR. There are some differences; but the in 1930 was $3,138,845,973. Over $3,000,000,000 was paid out Senator forgets that these capital or discovery allowances in that one year in the form of salaries to officers of the have all been made. The entire amount of the capital or corporations of this country. The officers of oil companies discovery value of the concern has already been taken up. got their part of that. Mr. BARKLEY. Of course that may be true as to certain The oil companies are entitled also to their part of depre- wells; but it is not true with reference to wells that are elation; and the depreciation of companies during that year constantly being brought in, or mines that are constantly was $3,900,000,000. I will not give the odd figures. being developed. It ma,y be that in some cases-it probably Prior year net loss, $157,000,000. is-the discovery value has already been allowed to the Tax-exempt dividends and interest, $3,000,000,000. business. Miscellaneous deductions-and the oil companies are en- Mr. McKELLAR. The Senator must realize that in the titled to miscellaneous deductions-$39,000,000,000. first place most of the wells have been discovered. Oil prop- Is it any wonder that the income-tax laws are not produc- erties are well known. Occasionally that is not true, but ing taxes? We have constantly increased the allowances all for the most part it is. the way along the line since this tax law was passed. Now Mr. BARKLEY. Notwithstanding that once every few I want to call the Senate's attention to what the total deduc- months the statement is made in the newspapers by some tions under our laws have been for a number of years. scientist or geologist tha-t all the oil fields have been dis- In 1930 the total deductions were $50,000,000,000. covered, we go on constantly discovering new oil fields, and In 1929 they were $53,000,000,000. bringing in new surpluses of oil. All of that property escaped taxes absolutely, $53,000,000,- 000 in one year; and, by the way, the oil companies received Mr. McKELLAR. Not in this country. the advantage of all those deductions, and in addition to that Mr. BARKLEY. Yes; in this country. a depletion allowance of one half. It is not fair and it is Mr. McKELLAR. It has been quite a while since that not right; and I have offered this amendment to do away has been true. What we are dealing with are the corpora with these two allowances. These companies ought to have tions now in existence; and they having had these great the same depreciation or depletion allowances that every advantages, these great subsidies-for they are reaUy sub other concern has. They ought not to be treated as a sepa- sidies-from the Government, the time has arrived when rate class. It is class legislation of the grossest kind. the Government should treat them just as all other corpo- Do not be misled by the idea thi:lt the oil companies are rations are treated. now in a bad fix, just as all other corporations, perhaps, Mr. GORE. Mr. President, the Senator from Tennessee are; or that they may be in a worse fix if my amendment [Mr. MCKELLAR] is always entertaining, even when he is should be adopted, for we do not tax them unless they make not convincing. His sincerity and his earnestness challenge money, unless they make an income. Those that make an respect even when his arguments do not carry conviction. income, I submit to the Senate, in all fairness and justice, The Senator from Tennessee has sought to create a set of ought to pay just like every other corporation. facts which do not exist, and he has made an unanswerable So I hope the committee will accept the amendment. assault upon that imaginary situation. I shall undertake to The House having passed the bill without putting this in, it demonstrate that the Senator from Tennessee is mistaken seems to me the committee ought to take the amendment to as to the facts; that he is mistaken as to the law; that he is conference and work it out. By the way, I digress here mistaken as to the application of the law to the facts; that long enough to say that the Secretary of the Treasury went he is mistaken as to the effect of this depletion legislation before the House committee and recommended that this upon individual taxpayers, and is mistaken as to its effect depletion matter be taken into consideration by that com- upon the public revenues and the Public Treasury. mittee and by the Congress. The House disregarded the Mr. President, I need hardly say that every part and Secretary's recommendation, and the Senate committee has every phase of our income-tax legislation is extremely intri disregarded it. I hope the Senate will not disregard it, and cate and difficult to understand. That is particularly true that this amendment will be adopted. of the section relating to depletion of capital-depletion al- . Mr. BARKLEY. Mr. President-- lowances. I may add that it is doubly true in respect to the Mr. McKELLAR. I yield. application of these laws to oil and gas wells, to oil and gas Mr. BARKLEY. The Senator a moment ago made the properties. statement that the House had passed this bill without these Intricate as this subject is, however, it is of much im provisions in it. I wish to say to the Senator that the Ian- portance. I may say that it is no less important than guage sought to be stricken out by the Senator's amendment intricate, and I therefore challenge attention to what · I is the language of the House bill shall have to say upon this subject. 6180 _CONGRESSIONAL RECORD-SENATE APRIL 6 Mr. KING. Mr. President-- reserve left in the ground. Every barrel of oil taken out of The PRESIDING OFFICER The PRESIDING OFFICER. Does th~ Senator make the Mr. LONG. I understand that ·the Senator from South point of order against the amendment? Carolina has a committee, however, so that he has one of Mr. TYDINGS. I do. these clerks. The PRESIDING OFFICER. The point of order is sus Mr. BYRNES. Yes. tained. Mr. LONG. So the Senator from South Carolina is not l\ilr. REYNOLDS. Mr. President, I think I have the floor. affected by it. As I understood, the Senator from Louisiana offered an Mr. BYRNES. Yes. I say to the Senate that the reso .. amendment, and therefore his amendment is out of order. Iution as it passed provided that any Senator could secure The PRESIDING OFFICER. A point of order was made a clerk in the way I have stated. As originally introduced to it. The amendment is not authorized by law or reported and reported the resolution provided that as to those Sen .. by a standing committee, and therefore it is not in order. ators who had only four clerks that might be done. At the A point of order has been made, and the Chair has sus request of the Senator from Arizona [Mr. ASHURST] the res tained it. olution was amended so that any Senator who made a state.. Mr. NEELY obtained the floor. ment in writing that he needed an additional clerk could Mr. LONG. Mr. President, I make a point of order. I have one. So far as the Senator from South Carolina is had already offered this amendment, and it was pending. concerned, he does not intend to make such a statement, so The PRESIDING OFFICER. Does the Senator from West that the resolution does not affect him. Virginia yield to the Senator from Louisiana? Mr. LONG. I know; but the Senator from South Caro .. Mr. NEELY. I do. lina has a committee clerk. Mr. LONG. I had already offered this amendment when Mr. BYRNES. Yes. the Senator from North Carolina [Mr. REYNOLDS] rose and Mr. LONG. And I have not. That is the difference. asked if, as a compromise, we could not agree on letting The Senator from South Carolina has got his food and I these clerks stay until September 1; and the Senator from have not got mine. Maryland said he would be glad to take that to conference, Mr. BYRNES. No; but when the Senator files a state .. as I understood. I think the RECORD will bear me out. I ment that he needs an additional clerk he will then have do not think the Senator from Maryland ought to interpose five clerks, just as I have. the point of order now. If he will take it to conference, if Mr. LONG. Until Congress adjourns. there is any trouble in the conference, I shall not object. Mr. BYRNES. Yes. Mr. TYDINGS. Mr. President, I will take the amendment Mr. LONG. But the Senator's committee clerk continues to conference, but I will not agree to keep it in the bill in on when a session of Congress ends. conference. Mr. BYRNES. That is true. He stays here and looks The PRESIDING OFFICER. What is the amendment? after the work of the committee. Mr. LONG. The amendment is as follows: Mr. LONG. Yes; that is the difference. On line 13, page 7, after the word" chairman", insert the Mr. REYNOLDS. Mr. President-- following: The PRESIDING OFFICER. Does the Sena.tor from Lou .. isiana yield to the Senator from North Carolina? Seventy additional clerks at $1,800 each, one for each Senator having no more than 1 clerk and 2 assistant clerks for him- Mr. LONG. Yes, sir. self or for the oommittee of which he is chairman, not, however. Mr. REYNOLDS. As I understand, I have before the beyond the 1st day of September 1934. Senate at the present time a motion to the effect that each Mr. TYDINGS. Mr. President, I ask that the question be Senator who makes a statement to the effect that he is put to ascertain the temper of the Senate. If the Senate desirous and needful of assistance ~hall hav~ an additional feels that we ought to have extra clerks here during the . clerk whose _empl~yment ~hall cont.mue until September l, recess, of course, it can so determine. and not be d1scontmued with the adjournment of the present The PRESIDING OFFICER. The senator from Mary- session of Congress.. land withdraws his point of order. The question is upon Mr. LONG. That is my amendment. . the amendment offered by the senator from Louisiana. The PRESIDING OFFICER. As the Chair understands, Mr. LA FOLLETTE. Let it be stated, Mr. President. that is the amendment offered by the Senator from Louisi .. The PRESIDING OFFICER. The amendment will be ana. stated. Mr. REYNOLDS. No; I offered that amendment. The CHIEF CLERK. On page 7, line 10, it is proposed to Mr. LONG. No; I offered it. The PRESIDING OFFICER. It will be regarded as offered strike out "70" and insert "140." jointly by the Senator from North Carolina and the Senator Mr. LONG. No, Mr. President. Add the following lines. from Louisiana. Just start at the word " seventy ", in line 10, and read Mr. REYNOLDS. The Senator from Louisiana offered through to "chairman", in line 13; repeat that language, the amendment after I offered it. and then add " not, however, beyond the 1st day of Sep Mr. LONG. Let it be regarded as the amendment of the tember 1934 ", so that the additional 70 will not take the Senator from North Carolina. same status as the other 70, but will go off the roll on the The PRESIDING OFFICER. The amendment will be 1st day of September, while the regular ones go on. stated. Mr. BYRNES. Mr. President, I merely desire to call the The CHIEF CLERK. On page 7, line 13, after the word attention of the Senate to the fact that yesterday the Sen " chairman ", it is proposed to insert: ate agreed to a resolution authorizing any Senator who Seventy additional clerks at $1,800 each, 1 for each Senator hav· stated that he needed an additional clerk to appoint such ing no more than 1 clerk and 2 assistant clerks for himself or for a clerk for the remainder of the session. the committee of which he is chairman, not beyond the 1st day o! The statements made to me as Chairman of the Commit September 1934. tee to Audit and Control the Contingent Expenses of the Mr. LONG. Mr. President, I just want to say that I do Senate by a number of Senators were to the effect that dur not think Senators who have a committee clerk and who ing the session they were unable to keep up with their cor have not any more work to do than we have to do ought respondence with the clerical assistance now in their offices; to take the position that they are going to vote down our but I think every Senator who talked to me on the subject having a clerk who will not be paid anything like the admitted that when Congress adjourned there would be no amount their committee clerk· is paid, and will be employed justification for having the additional clerks. I think the for only half the time. Their committee clerks draw sar ... resolution heretofore agreed to has provided all the assist aries-- ance that Senators can reasonably expect to receive at this Mr. REYNOLDS. Mr. President, a point of order. time, and that we should not now provide additional clerks. The PRESIDING OFFICER. The Senator will state it. The PRESIDING OFFICER. The question is on the Mr. REYNOLDS. I have an amendment before tha amendment offered by the Senator from Louisiana. Senate. ).934 CONGRESSIONAL RECORD-SENATE 6193 Mr. LONG. I am speaking on it. I am making a speech. The PRESIDING OFFICER. The Senator from Lou The PRESIDING OFFICER. The point of order is not isiana is recognized. sustained. The Senator from Louisiana has the floor. Mr. LONG. I again appeal to the good judgment of the Mr. LONG. For instance, the clerk of the Committee on Senator from Maryland. Unless my ears do not bear things Mines and :Mining gets $3,900 a year. Look at the Appro aright, and my mind does not remember them aright, the priations Committee clerk. He gets something like that, I RECORD will show that twice the Senator from Maryland guess. I have not the exact amount here. The Banking and myself were together on this matter and agreed that we and Currency Committee clerk gets $3,SOO. They close up were going to let this amendment be adopted and go to the Committee on Banking and Currency when Congress is conference. I have believed that if I could have the oppor- 1 not in session. tunity of taking the Senator from Maryland to my office he · Mr. TYDINGS. Mr. President, will the Senator yield? would not hesitate to stand for my having an extra clerk. Mr. LONG: Yes. Mr. President, as I view the matter, no harm would be 1 Mr. TYDINGS. I think the Senator unknowingly is mak done. If there is an objection by the House, I will not insist l ing an inaccurate statement. Three thousand nine hundred on it, and I will not complain. dollars is the salary of a Senator's secretary, whether he :Mr. COUZENS. Mr. President, will the Senator yield? be a committee chairman or a Senator without a committee. Mr. LONG. I yield. The committee clerks receive, I think, $75 more than the Mr. COUZENS. · The Senator from Maryland is not the second clerk in every Senator's office. only Senator who has a right to raise a point of order, and Mr. LONG. What does that make the salary? if these amendments are to be continually made to increase Mr. TYDINGS. Most of the committees have no clerks, the patronage for the Democrats or for the Republicans I so that a Senator who is a committee chairman has all his am going to exercise my right to my point of order, and I own work to do and all the committee work to do in addi shall do so as to the amendment to which the Senator from tion, with no extra force whatsoever. Maryland objected, whether he withdraws his point of order Mr. LONG. That applies to some few committees, Mr. o:i; not. President; but at least these that I am now reading have Mr. TYDINGS. Mr. President, I ask unanimous consent clerks. Here they are. that the clerk be authorized to correct the totals in the bill. Mr. TYDINGS. They are for every Senator, whether he The PRESIDING OFFICER. Without objection, it is so is a committee chairman or not. ordered. Mr. LONG. To be sure; there they are. They have them. There is the Committee on Immigration. There is a list of The question now is on the engrossment of the amend ments and the third reading of the bill. them as long as from Dan to Beersheba. The amendments were ordered to be engrossed and the Mr. TYDINGS. The Committee on Immigration, I think. bill to be read a third time. only has four clerks, and they are the regular Senator's The bill was read the third time and passed. clerks. That committee has no clerk whatever; so that if the Chairman of the Committee on Immigration were to EXECUTIVE SESSION resign from his chairmanship tomorrow he would have ex Mr. ROBINSON of Arkansas. I move that the Senate pro actly the same force in his office that he now has as chair ceed to the consideration of executive business. man of the committee. The motion was agreed to; and the Senate proceeded to Mr. LONG. Mr. President, I am not disputing that. the consideration of executive business. Mr. TYDINGS. The Senator said awhile ago that com mittee clerks got $3,900°. That statement is absolutely EXECUTIVE REPORTS OF COMMITTEES incorrect. Mr. McKELLAR, from the Committee on Post Offices and Mr. LONG. What do they get, as shown here on page 3, Post Roads, reported favorably the nominations of sundry line 19? postmasters. Agriculture and Forestry-derk, $3,900; assistant clerk, $2,880. Mr. PITTMAN, from the Committee on Foreign Relations, to which was referred an international telecommunication Mr. TYDINGS. That is what I am trying to tell the convention, the general radio regulations annexed thereto, Senator, but he will not listen. I say to the Senator that and a separate radio protocol, all signed by the delegates of each Senator has four clerks. The top clerk gets $3,900; the United States to the International Radio Convention at the lowest, $1,800. Then, if he happens to be a committee Madrid on December 9, 1932, reported them favorably with chairman in addition, he gets no extra clerk, but has to out amendment and submitted a report islative day of Mar. 28) I 1934 PETITIONS AND MEMORIALS UNITED STATES MARSHAL The VICE PRESIDENT laid before the Senate a letter from Hon. L. L. McCANDLESS, Delegate from Hawaii, trans· Austin D. Smith to be United States mars1lal for the dis mitting copy of a wireless message from Samuel K. Dias, trict of Delaware. deputy county clerk of Kauai County, Hawaii, embodying a POSTMASTERS resolution adopted by the Kauai County Board of Super .. CALIFORNIA visors, protesting against provisions of the so-called "Jones Costigan sugar bill", which are regarded as discriminatory George J. Nevin, Huntington Park. against the sugar industry in the Territory of Hawaii, OKLAHOMA which, with the accompanying paper, was referred to the Berry M. Crosby, Bixby. Committee on Finance. He also laid before the Senate a resolution adopted by SOUTH CAROLINA Local Lodge No. 249, International Association of Machin Robert Redus Martin, Belton. ists, of Ironton, Ohio, favoring the prompt passage of the Ray E. Young, Due West. so-called "Fletcher-Rayburn stock exchange bill", which Mary Ellen Seibert, Edgewold. was referred to the Committee on Banking and Currency. Pretto H. White, Ehrhardt. He also laid before the Senate a resolution adopted by a John Albert Howell, St. George. Woman's Home Missionary Society (no address given>, fa... Errett Zimmerman, Trenton. voring the passage of the so-called " Patman motion picture Loring Terry, Yemassee. bill", being House bill 6097, providing higher moral stand ards for films entering interstate or foreign commerc~ WEST VIRGINIA which was referred to the Committee on Interstate Maurice L. Richmond, Barboursville. Commerce. He also laid before the Senate a letter from C. William SENATE Kinsman, chairman of the City Fusion Sixth AD. Taxes Committee of the Bronx, New York City, N.Y., relative to the MONDAY, APRIL 9, 1934 pending revenue bill, taxes, and so forth, which was ordered to lie on the table. (Legislative day of Wednesday, Mar. 28, 1934> Mr. KEYES presented a resolution adopted by the Con The Senate met at 12 o'clock meridian, on the expiration cord (N.H.) Rifle Club, protesting against the passage of of the recess. legislation proposing to restrict the possession of firearms MESSAGES FROM THE PRESIDENT in the United States, which was referred to the Committee on Commerce. Messages in writing from the President of the United Mr. CAPPER presented petitions, numerously signed, of States were communicated to the Senate by Mr. Latta, one sundry citizens of Atchison, CUmmings, and Kansas City, all of his secretaries. in the State of Kansas, praying for the passage of the so MESSAGE FROM THE HOUSE called "Patman bill", providing for the payment of adjust· A message from the House of Representatives, by Mr. ed-service certificates of ex-service men in new currency, Haltigan, one of its clerks, announced that the House had which were referred to the Committee on Finance. passed without amendment the bill (S. 1983) to authorize Mr. HEBERT presented the following resolutions of the the revision of the boundaries of the Fremont National General Assembly of the State of Rhode Island, which were Forest in the State of Oregon. referred to the Committee on Finance: The message also announced that the House had passed STATE OF RHODE !sLAND, ETC., lN GENERAL ASSEMBLY, the bill (S. 2675) creating the Cairo Bridge Commission and January Session, A.D. 1934. authorizing said commission and its successors to construct, Resolution requesting Congress to investigate through a specially maintain, and operate a bridge across the Ohio River at or designated committee thereof certain activities of the Admin.. near Cairo, Ill., with an amendment, in which it requested istrator of Veterans' Affairs the concurren"Ce of the Senate. (Approved Mar. 14, 1934) The message further announced that the House had passed Whereas the Administrator of Veterans' Affairs has from time to time submitted estimates to the Congress of the United States, the bill (S. 2571) authorizing the Secretary of the Interior and to certain committees thereof, of the probable costs to the to arrange with States or Territories for the education, medi Government o:f measures advocated in behalf of disabled veter cal attention, relief of distress, and social welfare of Indians, ans and their dependents; and and for other purposes, with amendments, in which it re Whereas the American Legion, Department o:f Rhode Island, believes that such estimates have been consistently misleading quested the concurrence of the Senate. to the Congress and to the public and have been grossly unfair The message also announced that the House had passed to veterans and their dependents in that the people of the the following bills, in which it requested the concurrence of United States have received an erroneous impression concerning the probable cost to the taxpayer, and have been ape.thetic to the Senate: ward these measures as a result thereof: Now, therefore, be it H.R. 5369. An act providing for the issuance of patents Resolved, That the Congress of the United States be requested upon certain conditions to lands and accretions thereto de to investigate, through a specially designated committee thereof, the activities of said Administrator· of Veterans' Affairs in dm termined to be within the State of New Mexico in accordance nection with the above matters, with a view to ascertaining true with the decree of the Supreme Court of the United States estimates of the so-called "four-point program of rehabilitation" entered April 9, 1928; and advocated by the American Legion; and, further, to inquire into the source of information upon which the estimates submitted H.R. 8834. An act authorizing the owners of Cut-Off by the Administrator were based, and the influence, if any, which Island, Posey County, Ind., to construct, maintain, and oper prompted the issuance of such misleading statements; and be i~ ate a free highway bridge or causeway across the old channel further Resolved, That the general assembly respectfully requests the of the Wabash River. Senators and Representatives of Rhode Island in the Congress of CLAIM OF MOFFAT COAL CO. the United States to give their sincere efforts to secure the pas sage of suc:b. legislation as will enable the Senate or the House The VICE PRESIDENT laid before the Senate a letter of Representatives of the United States to conduct such investi• from the Comptroller General of the United States, trans gation; and be it further Resolved, That copies of this resolution be transmitted by the mitting, pursuant to law, his report and recommendation secretary of state to the Senators and Representatives of Rhode concerning the claim of the Moffat Coal Co. against the Island in the Congress of the United States.
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