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Page 198
An income tax initially enacted at low rates and later seized upon as a means to redistribute income in favor of the lower classes has become a facade, covering loopholes and special provisions that render rates that arc highly graduated on paper largely ineffective. A flat rate of 23 1/2 per cent on presently taxable income would yield as much revenue as the present rates graduated from 20 to 91 per cent. An income tax intended to reduce inequality and promote the diffusion of wealth has in practice fostered reinvestment of corporate earnings, thereby favoring the growth of large corporations, inhibiting the operation of the capital market, and discouraging the establishment of new enterprises.
Monetary reforms, intended to promote stability in economic activity and prices, exacerbated inflation during and after World War I and fostered a higher degree of instability thereafter than had ever been experienced before. The monetary authorities they established bear primary responsibility for converting a serious economic contraction into the catastrophe of the Great Depresson from 192933. A system established largely to prevent bank panics produced the most severe banking panic in American history.
An agricultural program intended to help impecunious farmers and to remove what were alleged to be basic dislocations in the organization of agriculture has become a national scandal that has wasted public funds, distorted the use of resources, riveted increasingly heavy and detailed controls on farmers, interfered seriously with United States foreign policy, and withal has done little to help the impecunious farmer.
A housing program intended to improve the housing conditions of the poor, to reduce juvenile delinquency, and to contribute to the removal of urban slums, has worsened the housing conditions of the poor, contributed to juvenile delinquency, and spread urban blight.
In the 1930's, "labor" was synonomous with "labor union" to the intellectual community; faith in the purity and virtue of labor unions was on a par with faith in home and motherhood. Extensive legislation was enacted to favor labor unions and to foster "fair" labor relation. Labor unions waxed in strength. By the 1950's, "labor union" was almost a dirty word; it as no

 
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