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This young man received that which enables him to reenter private life and is, as he says, "a contented discharged soldier." Gentlemen, will America not do as well by her soldiers and make them all contented discharged soldiers? I thank

you.

STATEMENT OF HON. CLARENCE MacGREGOR, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK.

Mr. MACGREGOR. I desire to state to the committee my views on compensation to the men who served in the World War.

All of the Members of Congress, I feel, are keenly desirous of expressing to them in some tangible form that gratitude that is felt for the great sacrifices that they made, and also in some degree making good the financial losses they have sustained.

The impression that I have gained from the men themselves is that they favor the $50 per month bonus plan. I myself believe that this is the most practicable plan. Let them have the money to do as they like with.

I feel that they are entirely justified in feeling that there is something coming to them. They went into service to protect and defend our country. They gave their time, they gave up their hopes and ambitions, were torn from their business and professions, endured the hardships, and encountered the dangers. They received meager pay and suffered financial losses in many instances. They come back and thousands find themselves destitute, supplanted by others, and in many ways handicapped because of their service.

On the other hand, millions who were permitted to remain at home and engage in the enormous industrial activity that was caused by the war reaped a golden harvest as a result of the prosperity that attended this activity. A flood of money poured into the pockets of the workmen, the manufacturers, the contractors, and all of those who came into contact with war contracts. The data is not at hand at the present time to determine the number of millionaires created in this country by the war, but it is safe to assume that there were several thousand.

The proposition is to secure the money necessary to finance the bonus plan without crippling the credit of the country. It is undoubtedly true that if more bonds are issued they will sell far below par and will also cause the bonds already issued to fall much lower. This would be a calamity not only to the present holders of Government securities, but also to the men who would receive the bonds. Some other method must be found.

In 1916 Congress passed an act known as the "estate tax." Under this act all estates pay to the Federal Government a tax ranging from 1 per cent on estates of not less than $50,000 to 25 per cent on estates in excess of $10,000,000. In 1919 the Government obtained from this source a revenue of $83,089,983.13.

I suggest that for the purpose of paying the ex-service men, the national debt, and the expenses of the Government in the future; that hereafter no person shall be permitted to devise or bequeath more than a certain amount and that the surplus be paid into the Federal Treasury.

Nine thousand three hundred and eighty-six persons in the United States now own fifty-five billions of its wealth; 2,060 persons own

twenty billions; 625 persons own seventeen billions. This evidence is based on the 1917 income-tax reports. No one could hazard a guess upon what the 1919 returns will show.

In 1914 there were 10,694 millionaires; in 1915 there were 14,771; in 1916, 22,693; and in 1917, 26,190.

I append a table showing what would be paid into the National Treasury, assuming that all estates exceeding $2,000,000 were turned over to the Government.

If estate tax statute provided that no person should devise in excess of $2,000,000 and that the overplus should be paid into the Federal Treasury the Government would receive, based upon 1917 income-tax returns, capitalizing at 4 per cent:

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It is estimated that 2 per cent of the wealth of the country goes through the probate courts each year.

This is not a new or novel idea. It is supported by such eminent business men and statesmen as Andrew Carnegie, Daniel Webster, Theodore Roosevelt, and others. The time is ripe, not only to meet the present needs, but also to adopt a plan that will settle many of our domestic troubles and save our Republic from the dangers that confront it in the shape of swollen fortunes.

I beg to quote what some of the men mentioned above have said upon the subject.

Daniel Webster said in his speech at the dedication of the Bunker Hill Monument:

The freest government, if it could exist, would not long be acceptable if the tendency of the laws were to create a rapid accumulation of property in a few hands and to render the great mass of the population penniless.

The president of the New York State Bar Association, in his annual address, January 16, 1900, said:

It is the continued accumulations, generation after generation, that presage harm to the community and imperil the welfare of the State. It is the great fortunes sent bowling down through the ages that are able to gain force enough to threaten the continuance of the institutions which made their existence possible.

Theodore Roosevelt, while President, made an address in which he said:

I feel that we shall ultimately have to consider the adoption of some such scheme as that of a progressive tax on all fortunes beyond a certain amount, either given in life or devised, or bequeathed upon death to the individual—a tax so framed as to put it out of the power of the owner of one of these enormous fortunes to hand down more than a certain amount to any one individual.

STATEMENT OF HON. FREDERICK C. HICKS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK.

Mr. HICKS. Mr. Chairman and gentlemen of the committee, I desire to occupy only a brief time in expressing my views upon the proposition of soldiers' and sailors' compensation. Permit me to say, by way of introduction, that the word "compensation" as used in this connection is a misnomer, for all must realize that no real financial compensation can be made to those who served their country in the hour of its need. No money standard can be used in measuring courage and daring. If it could, there is not wealth in all the world sufficient to pay the men for deeds which lead on to victory.

It may be claimed by those who oppose this measure that the men fought for principles, not for dollars; for glory, not for money. True, no sordid motives inspired the patriotism or animated the willing sacrifice of those who joined the colors. And this bill does not seek to reward; it provides, not compensation for services rendered, but equalization for opportunities lost.

The conditions resulting from the great conflict opened the door for many at home to profit hugely in supplying the fighting forces. Had there been no conflict, conditions would have remained normal. But there was a call to arms. Without the soldiers and sailors there could have been no war, no victory, and no unusual opportunities. Our boys were essential factors in that struggle, the determining factors, as it proved, and they created the opportunity from which others benefited. Is there any just reason why they should not now be recognized?

You say it was the privilege of the youth of the land to spring forward in defense of their country. Yes, it was, and it always has been and, I presume, always will be the duty of those physically able to fight for their flag. Yet that does not alter the premises. While the men at the front, and those only too anxious to "go across were receiving $1 per day many of those at home were profiting to the extent of $6, $8, or $10 per day. True, those in the service were paid, fed, quartered, and had allowances given their families. But that pay and those allowances fell far short of what others received.

Then as to the civilian employee of the Government. We passed a law providing for a bonus of $240, and in one branch of the service the bonus will reach as high as $450 per annum. Remember that the men with the colors were also employees of the Government. Why differentiate between the man in civilian clothes and the man in uniform? What justice is there in discriminating against the military employee when we recognized the claim, the just claim, of the civilian employee? The high cost of living worked against the family of one as much as against the family of the other. The pay of the soldier, his keep, and the allowance granted by the Government in the absence of the breadwinner did not equal the pay of the clerk and bonus paid.

The fact that these men have now been discharged has no point, in my opinion. In again entering business they will be on a par with those already employed, but they can not make up for what has

gone. They have lost opportunity in direct ratio to the time they served.

Many say that the money paid these men will be squandered. Perhaps some of it will. Has not some of the money received by those not in the service been squandered? If the soldiers do not spend it advantageously, it is their privilege: they have won it. And, while I deprecate the waste of money, I will not deeply regret the boys having some pleasure with what they have so deservedly earned. Now, as to the ways and means of payment. I frankly confess that I do not know how much money this bill will call for. The War Department, in a letter received only this morning, states that they are unable to tell me the length of service in the Army or to estimate the cost. I doubt if the Navy or the Marine Corps or the Coast Guard can at present give any reliable figures. It will be a huge amount, that is certain. Some 4,600,000 persons will be affected, with length of service running from a month or two to two years and more.

My plan is to pay them in bonds-service bonds-to be issued in denominations as low as $30. My thought has always been that the surest way to stimulate loyalty and to create a virile, responsive citizenship is to have every person directly interested in the Government itself; to make, if possible, each one an active partner in the great enterprise of which he is always a part. My contention is that the man who holds a Federal bond, even though it be a small one, is a better citizen from this fact and will take a deeper and more intelligent interest in the affairs of the Government.

Oh, yes, some of these bonds will be lost, others will be sold, of course. The soldiers and sailors are human beings, but other have been known to lose their securities or sacrifice them on the market. But if the men lose them or sell them unwisely they, and they alone, are the sufferers, and those that do retain them will better appreciate their citizenship and the Nation will profit thereby.

Mr. Chairman, I realize fully the enormous burden that now confronts the taxpayers of this country, and no one is more anxious for a rigid curtailment of expenses than I. If in the judgment of this committee and of Congress it seems best to defer action on this matter until conditions approach normal, I sincerely hope that the gratitude we feel and must always feel for those who fought for the perpetuation of our institutions will not be forgotten.

(Whereupon the committee adjourned.)

PART 11.

SOLDIERS' ADJUSTED COMPENSATION.

COMMITTEE ON WAYS AND MEANS,

HOUSE OF REPRESENTATIVES,

Washington, D. C., Wednesday, March 24, 1920.

The committee this day met, Hon. Joseph W. Fordney (chairman) presiding.

The CHAIRMAN. Gentlemen, I believe Mr. Scrugham has been requested to map the manner of procedure. Mr. Scrugham, whom would you like to introduce first?

Mr. SCRUGHAM. I would like to make a preliminary statement, if the committee will allow me.

The CHAIRMAN. Very well, proceed.

STATEMENT OF MR. JAMES G. SCRUGHAM, OF CARSON CITY, NEV.

The CHAIRMAN. Mr. Scrugham, give your name and address, and state whom you represent.

Mr. SCRUGHAM. My name is James G. Scrugham, and my address is Carson City, Nev. i appear at the request of and by the direction of the national commander and the national executive committee of the American Legion.

At the Minneapolis convention of the American Legion, held on November 10, 11, and 12, 1919, the sentiment was clearly expressed that the service men desired that, if consistent, they be given aid along four distinct lines, and when I say if consistent, i would like to have it understood that it is meant if consistent with the good of the entire country. These four lines were, first, land-settlement aid; second, home aid; third, vocational training; and, fourth, what is termed adjusted compensation.

At a meeting of the executive committee of the legion, held in Indianapolis something over a month ago, the matter was somewhat more definitely crystallized, more definite instructions given, and a special committee to draw up what beneficial legislation the soldier might need was appointed. This committee met, and in a tentative way drew up certain resolutions, on the 16th day of February, and pursuant thereto our national commander, Mr. D'Olier, and Mr. T. W. Miller, appeared before the committee some two weeks ago and made a preliminary statement. However, it appears from the discussion that followed that this was not sufficiently definite, and for that reason our national commander called together the executive committee, consisting of representatives from absolutely every State in the Union, which met here on Monday morning.

The object of this was to determine whether or not the sentiment of the various States of the Union was for the action of the national

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