_Pa.s.sage by the Second House._--When a bill is pa.s.sed by one house, it is signed by the presiding officer, after which it is transmitted to the other house, where it goes through practically the same stages of procedure as described above. If the bill is pa.s.sed by the other house without amendment it is "enrolled," after which it is ready for the signature of the President. If, however, a bill as pa.s.sed by one house is amended by the other, it is customary to appoint a conference committee, consisting usually of three members from each house, to discuss the differences and suggest a basis of compromise. The committee usually recommends that each house recede from its position on certain points, and the result is reported to each house, which usually accepts the agreement and the bill is pa.s.sed. Many important bills are finally pa.s.sed in this way, though occasionally the two houses fail to reach an agreement and the bill fails.
_Approval of the President._--When the bill is presented to the President he is allowed ten days to make up his mind as to whether he will sign or disapprove it. If he refuses to sign it, he usually returns it to the house in which it originated, with a statement of his objections, after which the house must proceed to reconsider it, and if it is pa.s.sed by a two-thirds vote it is sent to the other chamber and if repa.s.sed by it by a two-thirds vote it becomes a law notwithstanding the veto of the President. But in such cases the yeas and nays must be entered on the journal of each house so that the record may show that the bill was properly pa.s.sed. In case the President does not approve the bill and neglects to return it within ten days to the house in which it originated, it becomes law in the same manner as if he had signed it, unless Congress should adjourn in the meantime so that it cannot be returned, in which case it does not become law. As a large number of bills are usually sent to the President during the last ten days of the session, an opportunity is thus afforded him for defeating bills by neither signing nor vetoing them. This method of defeating bills is popularly described by the term "pocket veto," a procedure sometimes resorted to where the President does not approve a bill and yet does not wish to take the responsibility for positively vetoing it.
=Procedure in the Senate.=--In the senate, partly by reason of its small size, partly by reason of its permanence, and partly by reason of the tradition of senatorial courtesy, the procedure is somewhat different from that of the house of representatives. For example, the senate rules are permanent, that is, they continue from one Congress to another and do not have to be adopted anew every two years.
_The President of the Senate_ is little more than a moderator; indeed, he may belong to a different political party from that which is in control of the chamber--a situation that never happens in the house. He does not appoint the committees of the senate, and so has no power of predetermining the character of legislation. Moreover, he has no power to control debate through the power of recognition. The traditions of the senate require that he shall recognize the first senator who rises to speak, and that he shall treat the members of both parties impartially in according recognition for purposes of debate.
_Unlimited Debate._--Until 1917 one of the usages of the senate was the right of unlimited debate. Owing to the small size of the senate, much greater freedom of discussion is possible than in the house of representatives, where there are more than four times as many members.
Debate can also be conducted with much more ease and is much more effective, since the size of the hall is smaller and members are not under the necessity of speaking at the top of their voices. While a member of the house can rarely get an opportunity to deliver a speech and then only for a few minutes, a senator may usually speak as long as he pleases. Advantage of this privilege is frequently taken by senators to deliver long speeches, not so much to convince their colleagues, as to get their views before the country at large or to make an impression on their const.i.tuents at home. Under the rules as they were before 1917, there was no limit to a senator"s right to debate. The privilege was made use of occasionally near the close of a session for "filibustering"
purposes. Thus a few senators with strong lungs, large vocabularies, and a liberal supply of doc.u.ments from which to read, might consume the time of the senate for weeks and prevent it from acting on measures to which they were opposed. Many times in our history a single senator has forced the senate to abandon the consideration of important measures, by threatening to consume the remaining time of the session by speech making. In the last days of one session of Congress, a senator from Wisconsin spoke continuously for more than seventeen hours in an effort to prevent action on a currency bill. Near the end of the 64th Congress (March, 1917) a small group of senators filibustered to prevent the senate from taking a vote on a bill to give the President authority to arm American merchant vessels for defensive purposes, notwithstanding the fact that nearly all the other senators desired to pa.s.s the bill.
Shortly thereafter the senate adopted a new rule which makes it possible, by a two-thirds vote, to limit the debate on any measure to one hour for each senator. The rule was applied in November, 1919, to bring to an end protracted discussion of the treaty of peace with Germany.
=References.=--BEARD, American Government and Politics, ch. xiv.
BRYCE, The American Commonwealth (abridged edition), chs. xiii-xv.
HART, Actual Government, ch. xiv. HARRISON, This Country of Ours, ch. iii. REINSCH, American Legislatures and Legislative Methods, ch. i.
=Doc.u.mentary and Ill.u.s.trative Material.=--1. The Congressional Directory. 2. The House and Senate Rules. 3. Precedents of the House of Representatives, published as a public doc.u.ment in 1909.
4. The Congressional Record. 5. Specimen copies of bills and resolutions. 6. The last annual message of the President. 7. Copies of committee reports. 8. Veto messages of the President. 9.
Diagrams of the house and senate chambers.
RESEARCH QUESTIONS
1. Why are rules of procedure necessary in legislative bodies?
2. For what purpose does the Const.i.tution require each house to keep a journal of its proceedings?
3. Which do you think the better practice, the American rule, by which each house of Congress settles election contests of its own members, or the English rule, which places that power in the hands of the courts?
4. What is the reason for allowing a small number of members of each house to compel the attendance of absent members?
9. Do you think it would be a wise provision to permit the members of the cabinet to occupy seats in Congress without the right to vote?
10. Trace a bill through Congress, showing the various stages through which it must pa.s.s before becoming a law.
11. Of what committees is your representative a member? Is he chairman of any committee?
12. Do you think the minority party should be given a larger representation on the committees of Congress and larger privileges of debate?
13. Give the names of the five most distinguished speakers of the house of representatives since 1789.
14. Why is debate more effective in the senate than in the house of representatives?
15. Which of the two houses exerts the greater influence in determining national legislation? Give your reasons.
16. What are some of the so-called "usurped" powers now exercised by the senate?
CHAPTER XII
FEDERAL FINANCE, TAXATION, AND MONEY
=The National Taxing Power.=--The lack of the power of Congress to levy taxes was, as we have seen, one of the chief weaknesses of the Articles of Confederation, voluntary contributions by the states being the chief source of revenue for the national government. When, therefore, the framers of the Const.i.tution came to deal with this subject, they wisely provided that Congress should have power to levy and collect its own revenues. The power conferred is almost absolute, the only limitations being that no duties shall be levied upon exports; that excises and duties levied on imports shall be uniform throughout the United States, that is, they shall be the same in amount on a given article everywhere; and that where direct taxes are levied, they shall be apportioned among the states on the basis of population.
=Forms of Federal Taxes.=--The two general forms of taxes recognized by the Const.i.tution are direct and indirect taxes. The only direct taxes, in the sense of the Const.i.tution of the United States, are poll taxes, and taxes on real or personal property, all of which are required to be apportioned among the states on the basis of population, whenever they are levied.
On account of the obvious injustice of levying a tax on the states on the basis of population, inasmuch as there might easily be twice as much property in one state as in another having the same population, this method has fallen into general disuse. Indeed, it has been resorted to by Congress only five times in our history, and then only for very short periods in each case. It does not seem likely that this method of federal taxation will ever again be resorted to.
Until recently the two princ.i.p.al sources of federal revenue have been duties on imports, and internal revenue, or excise taxes, on certain articles produced in this country.
=Customs Duties.=--_Specific and Ad Valorem._--Customs duties are taxes levied on articles imported into the United States from abroad. They are of two kinds, specific and _ad valorem_. Specific duties are those levied on the articles according to their weight or measurement without regard to their value. Thus a duty of one and a half cents a pound on imported tin plate, or five cents a pound on dyestuffs, or ten cents a yard on silk would be specific. An _ad valorem_ tax is one levied with reference to the value of the article. Thus a duty of 50 per cent on the value of imported woolen goods is an example of an _ad valorem_ duty.
Sometimes both forms of duty are levied on the same article.
In favor of the specific duty is the ease of collection, since the article has only to be weighed or measured and then a.s.sessed. But it is often inadequate, since one yard of cloth or one pound of dye may be many times more valuable than another, and so with many other articles.
One practical objection to the _ad valorem_ method is the opportunity which is afforded for fraud in the matter of valuation, since in many cases it is difficult to ascertain the real value of the article taxed.
_The Protective Tariff._--From the beginning of our existence as a nation, reliance upon customs duties as a chief source of revenue has been a part of our established policy. In 1921 the receipts from this source were $308,025,102; and in many earlier years they were nearly half of the entire ordinary income of the national government. Great diversity of opinion, however, has existed in regard to what articles should be taxed and the amount that should be imposed. The Republican party has always insisted upon a tariff not only for revenue but also for protection to American industries and American labor against the cheap labor of the Old World. The Democratic party, on the other hand, has generally opposed the protective feature and insisted upon a tariff primarily for revenue.[35]
[35] But in 1916 a Democratic Congress laid a protective tariff on imported dyestuffs to encourage a home industry.
_The Preparation of a Tariff Bill_ devolves upon the ways and means committee of the house of representatives, where all revenue bills must originate.[36] In 1916 Congress provided for the creation of a bi-partisan Tariff Commission to investigate the operation of tariff laws and to make reports with a view to furnishing Congress with information for its guidance in the preparation of tariff bills.
[36] The senate, however, has the right to propose amendments. Thus the tariff bill of 1894 was amended by the senate in nearly a thousand particulars. Again, the tariff bill of 1909 was so altered by the senate that it was in many respects a new bill, and the differences between the two houses were settled by a conference committee.
_The Maximum and Minimum Principle._--In 1909 Congress adopted for the first time the maximum and minimum principle of fixing tariff rates. The law provided for a maximum and a minimum rate on many articles and authorized the President to apply the minimum rate to goods imported from countries which extend the same concession to articles imported by their citizens from the United States and to apply the maximum rate to others.
_Reciprocity Treaties._--At various times in the past reciprocity treaties have been negotiated with foreign countries by which it was provided that lower rates should be levied on articles imported from such countries in return for reciprocal concessions of a similar kind from them; or that there should be free admission of articles by one country from the other.
=Collection of Customs Duties.=--The collection of the customs duties is part of the work of the treasury department. The country is divided into collection districts, in each of which there are one or more ports of entry and customhouses at which all imported goods must be landed. In each district there are a collector and a corps of appraisers, weighers, gaugers, naval officers, surveyors, and the like.
By far the most important port of entry in the United States is the city of New York, where the aggregate receipts for the year 1910 were two thirds of the entire amount received from customs duties in the United States. Until recently a number of the collection districts, however, were unimportant, and in a few the expenses of administration exceeded the receipts. Thus the receipts of the Georgetown (S. C.) district in 1910 were only $49.38, while the expenses were $265; the receipts of the Rock Island (Ill.) district were $51.79 and the expenses $660; the receipts of the Saco (Me.) district were $9.08 and the expenses $753.92.
In pursuance of an act of Congress pa.s.sed in 1912, the President has recently abolished or consolidated many of these districts, so that the number is now only 49, whereas formerly it was 120. For a long time the secretary of the treasury had urged Congress to authorize this reform, mainly in the interest of economy, but it acted tardily.
When goods are purchased abroad to be imported into the United States, the importer files with the United States consul at the foreign port from which they are to be exported an invoice containing a list of the goods and a statement of their value at the place where manufactured or produced. The consul certifies to the correctness of the invoice and sends a copy to the collector of the port at which the goods are to be landed.
_Appraisals._--Upon arrival in the United States, the cargo is examined by the customs officers to see that it corresponds with the description contained in the invoice. If it is found that the goods are undervalued the value will be raised by the appraiser. If there is evidence of fraud, the goods will be confiscated or a heavy fine imposed on the importer.[37]
[37] If the importer for any reason does not desire to remove his goods immediately and pay the duty thereon, he may store them in a government warehouse by giving a bond for double the amount of their value. He may then withdraw them at any time within a year upon the payment of the duties. If they are reexported the payment of duties is not required.
There is a general board of appraisers to which appeals may be taken by the importer on questions of valuation, and recently there has been created a United States court of customs appeals for the determination of various questions arising in the administration of the tariff laws.
=Internal Revenue Taxes.=--The second important source of federal income is excise taxes, or what are popularly known as internal revenue duties, that is, taxes on commodities produced in the United States.
_The Receipts_ from internal revenue taxes as compared with those from customs duties were inconsiderable before the Civil War. In 1862, however, Congress pa.s.sed a comprehensive internal revenue law which increased the tax on liquors and levied a tax on tobacco, besides license taxes on various trades and occupations. So many articles were taxed that the revenue from this source in 1866 amounted to more than $309,000,000, the largest sum collected in one year from internal revenue taxes until 1915. In 1917, in consequence of the war, the rates of many taxes were increased and new taxes were levied on freight and pa.s.senger transportation, express charges, telegrams, insurance policies, theater tickets, automobiles and many other articles, and a great variety of business transactions, such as stock transfers, bond issues, etc. For some purposes the taxes on incomes, profits, and inheritances (page 224) are called internal revenue. The following are the princ.i.p.al items of internal revenue in the year ending June 30, 1921:
Income and profits tax $3,228,137,673 Distilled spirits 82,623,428 Tobacco 255,219,385 Estate inheritance tax 154,043,260 Tax on sales 282,222,065 Tax on tickets of admission 95,890,650 Tax on corporations 81,525,652 Tax on bonds, stock issues and transfers, etc. 72,468,013 Tax on transportation, telegraph and telephone 301,512,413