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domiciled and live from one end of the year to the other in other States. What do you have to say about that?

Mr. ATHERHOLTZ. I understand it is wrong, and I understand it amounts to four and five hundred thousand dollars in value, and the things that I am talking about are millions of dollars in value. Mr. Bates. But it relates to costs.

Mr. ATHERHOLTZ. You are talking about individual costs, and I agree absolutely, and they are people who are contributing nothing whatever, and getting that free, and I am 100 percent against it. There is not any citizen in the District of Columbia who thinks that is fair.

Senator Cain. Mr. Witness, everything that you have to say is important. We are going to have to say, however, because of the pressure of time that it is my suggestion to you that with reference to specific bits of legislation, if you would be kind enough to submit to us your opinions in writing, that will serve your purpose and save our time, in view of the fact that the Senate is going to convene in a few minutes.

Mr. ATHERHOLTZ. Thank you.

Senator Cain. Let me ask this question in order to show us exactly what you are in support of, your organization is in support of, which pieces of legislation Income tax!

Mr. ATHERHOLTZ. We are in support of the income tax as presented here.

My own individual association is opposed to it but our council of all the associations west of Rock Creek is in favor of the sales tax, but only if we get a proper Federal contribution, where the Federal Government is doing its share.

Then we are ready to have a sales tax which will meet the other necessities. When and if that should be enacted, we hope that section 2 (b) will be taken out, which lays a tax on

Senator Cain. The committee has a perfect right to assume that basically your organizations are not in opposition to the sales tax; they are not in opposition to the income tax.

Mr. ATHERHOLTZ. They are strongly in favor and we most strongly endorse the income-tax law as introduced, and we are willing to endorse the sales tax, if it becomes a necessity, after proper Federal contribution; that is the qualification.

Senator Cain. And you have assumed, in that connection, a rather large responsibility this morning in designing, and I say that seriously, from your point of view, a formula which offers a remedy for the defects

Mr. ATHERHOLTZ. I am due to go to the hospital for some surgery in the next week or two, and I am pressed hard to get my own affairs out.

Senator Cain. We hope that you do recuperate, and soon, and just come out of that ether with an idea that we do not have.

Mr. ATHERHOLTZ. No, I am going to forget all of that.
Senator Cain. Thank you very much.
Mr. ATHERHOLTZ. And my apologies to the Commissioners.

Mr. Bares. Now, Mr. Chairman, have you anything further to offer to this committee?

Commissioner Young. Just one moment. Let me see. I believe there were some things left over this morning that Mr. West could have answered.

Do you not recall something!

Mr. BATES. Well, I do not think so. We were discussing taxes this morning, were we not, Mr. West?

Mr. West. I had to attend another meeting this morning.
Mr. BATES. What was the question we had in mind at that time?

Mr. WEST. As I understand, it was the question with respect to the retirement.

Mr. BATEs. I think that is all cleared up.
Mr. WEST. I think so.

Mr. BATES. I think that was all cleared up by the doctor. Well, Mr. Commissioner, I think that I can speak for the committee when I say that you have been very courteous and kind and very generous with all of the information.

Your department heads, in my opinion, and I think the chairman also coincides with me, that they have been well prepared to answer any and all questions that we asked.

It is not an easy task, we understand, to span over a period of 10 years and ask a department head to go back through 10 years, and go back to last year, and tell us why and how the expenses have increased, but I think that altogether they have done a very fine job, and they have impressed me, and I know they have impressed Senator Cain very much, by their ability to answer those questions, and the sincerity with which they did answer them.

And that is all the purpose of the committee has been, is to seek the facts, make an analysis of your over-all problem, project it into the future.

That is as I think the communities ought to be geared, into the future, as to what the needs may be, and to develop some method by which that projected program can be financed without any excessive load being forced upon any segment of our taxpayers.

I think, as I said before, I can speak for the committee, and offer you worthy commendation of the fine job you have done.

We have yet to hear from the people. We are calling it an Old Town Meeting, that we shall hear them if they have anything to offer, but apparently, from the opportunity we gave them, there was not any resistance to your programs, so generally speaking, you must stand pretty well here. I think you could be reelected easily.

Commissioner Young. Mr. Chairman, I want to take the opportunity now offered to thank you for the very fair hearing you have given us.

I have been impressed, and I know the other commissioners have been, too, with your fairness, and the questions you have asked. It makes us feel absolutely sure that the District is going to profit from the work you are starting.

Mr. Bates. I think, as was said yesterday, we are developing a record here that might well be used as a bible for you fellows, and We might look back on the record.

I have been working with Mr. Walker, and his assistant, and this morning, it was coming to some basis by which we can give more attention to the income tax problem, which I think is a basic problem here.

Now, the meeting will adjourn until next Tuesday, when we will hear the opposition to any of your suggested taxes. I do not know what form that will take, or I have no record of who are opposing it, but we will be glad to listen to them as attentively as we listened to the commissioners.

Commissioner MASON. Do you want any of our technicians here! Mr. BATES. Technicians?

Commissioner Mason. Lawyers of the commissioners, or department heads, for inquiry?

Mr. BATEs. No; because this is purely, in my opinion, a statistical situation.

We are basing our decision on the needs of the District. And you have had appropriations made already, or under consideration for the 1948 budget, which you will have to support before the Appropriations Committee of the House.

But I want to examine all of those projects over that period of 5 or 10 years, and in my own way, discuss that with the commissioners and the department heads having to do with that type of program.

Commissioner Mason. Good.

Mr. Bates. You are doing here exactly what I think ought to be done everywhere.

You are projecting that program, and laying the foundation for financing.

Unless you do that, you cannot succeed. Commissioner Mason. You cannot go anywhere otherwise. Mr. Bates. You are living by hand to mouth otherwise. That is what we will call it.

You do not know what the future is. You cannot develop any type of program which would be worthy of anything. As long as you have organizations in this city, planning boards, working very closely with the commissioners, and the municipal departments, and the programs in this city, for years ahead, taking certain segments and certain periods of time, that is fine.

We ought to very carefully watch that program, and to assist in the financing of it as best we can. That is the only thought that I have in mind, and I know the Commissioners have, as well as the committee.

Thank you very much.
Commissioner Mason. Thank you, Mr. Bates.
Mr. Bates. We will adjourn now until 10 a. m. on next Tuesday.

(Thereupon, at 3: 35 p. m., an adjournment was taken until 10 a. m., Tuesday, April 8, 1947.)

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Washington, D. C. The joint subcommittee met at 10 a. m., pursuant to adjournment, in the Senate District Committee room, Capitol, Washington, D. C., Senator Harry P. Cain (chairman of the joint subcommittee) presiding.

Present: Senator Cain, Representatives Bates (cochairman of the joint subcommittee) and Smith.

Present also: James R. Kirkland, counsel to the Senate District Committee; Parker L. Jackson, special adviser to the House Committee on the District of Columbia.

Senator Cain. May I suggest that this morning's session come to order.

I have a piece of paper in front of me with the names of nine individuals representing either groups of people within the District, or representing, as they have a perfect right to do, only themselves as individual citizens.

I likewise find after each name an approximation of the time the witness thinks he or she will require.

If we are successful this morning between now and 12 o'clock, we shall have heard from nine witnesses.

Our first witness will be Mr. Milton S. Kronheim, who thinks he can accomplish his mission in 10 minutes.

Prior to asking him to join us at this table, I would suggest that Mr. Arthur H. Vandenberg, chairman of the Senate Committee on Foreign Relations, is going to speak early in this afternoon's session on the President's request for assistance to Turkey and Greece. It is not for me to dictate what anybody else feels, but this is a tremendously absorbing and interesting and confusing subject, and I draw your attention to it in the hope that some of you will have a chance to go and hear him.

Mr. Kronheim, will you join us here, giving to the reporter your name and that title under which you wish to appear, if you will, sir?



before you.

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KRONHEIM & SON, WASHINGTON, D. C. Mr. KRONHEIM. My name is Milton S. Kronheim, and I am president of Milton S. Kronheim & Son, Inc.

Gentlemen, I appear here as a native citizen of the District of Columbia, and as a wholesale licensee under the Alcoholic Beverage Control Act.

While I am particularly concerned with the bill, H. R. 2284, which provides, in general, for a 100-percent increase of the taxes on alcoholic beverages, I am also concerned with the entire tax program as it is

The revenue program which has been presented to you and is before you in the form of some half dozen bills is designed to raise $18,000,OCO more revenue than is now being raised by the tax program of the District of Columbia.

I invite your attention to the fact that at the same time this additional revenue program is submitted, you have before you, or before other committees, appropriation bills for the District which would call for the expenditure of approximately $25,000,000 more than is called for in the appropriation for the 1947 fiscal year. .

All of these bills, tax bills, which you are considering and upon which you have heard the views of District officials, would have, in my mind, one tendency. That tendency is to make the District of Columbia a less pleasant place in which to live, and a less pleasant place to visit and to do business.

Since this is the National Capital, I believe that the program of revenue-raising that is thus before you would tend to destroy the very purposes for which this city was created out of the wilderness in 1800. I cannot believe that the revenue program, therefore, marches along with the intent of Congress or the intent of the founding fathers in the creating, development, and maintenance of this city.

It is the purpose of all of us to make this a hospitable city; to make it a city which all Americans will want to visit; to make it a city which they can visit without financial punishment.

The businessmen of the city, and the Congress, have gone to great lengths to make it a city of beauty and of attraction in order that people from all over the country will come out here. Every bill in this program detracts or, if enacted, would detract from the desirability of visiting the National Capital.

I do not set myself up as an expert on taxation or as an expert on government. But I have been in business in the District ever since I was 13 years old, and I believe I know what will be the effects of these bills upon those who sincerely want to come here and those who sincerely want them to come here. Furthermore, I cannot believe that the bills will raise the revenue which the committee drawing the measures thinks would be raised.

That committee originally consisted of officials of the District. In submitting their report, the committee indicated that it had cast wildly about for any measures which might bring in more money, regardless of the effect in other directions.

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