In a similar way the taxation of any form of notes or bonds or stock doubles the assessment in form without increasing the abilities. _The actual property in use will finally bear the burden of both assessments._ The road-bed and rolling stock of a railway are property whose value is readily estimated. The actual ownership is in a corporation which may be distinctly taxed. Certificates of stock are individual titles in that corporation whose property has already been taxed. Its outstanding bonds are simply claims against that corporation, to be paid out of that property which has already been taxed. So every note, being evidence of debt simply, is not a representative of property, but simply a claim against property supposed to exist somewhere else. It may be an absolute fiction, in being a claim against property only hoped for. The result of all efforts to treat certificates of indebtedness as personal property are hardship to debtors and apparent fraud on the part of many creditors. Even though the creditor escapes taxation by hiding his possession of a mortgage, the possibility of its being taxed is always counted in his bargain with the borrower as an important element in interest. The experience of those states in which such taxation has been abolished proves that lower rates of interest are sure to follow.
_Income taxes._--A favorite device in some countries, and often advocated in this, is a direct tax upon incomes above a certain amount, graduated so as to give a much larger rate upon large incomes than upon more moderate ones. The most obvious reason for such a distinction against the large incomes is the evident failure of our national system of taxation to distribute the burden according to ability. It is evident that the expenditures of the very wealthy for such articles as bring revenue to the government are not in the same proportion to their income as the expenditures of the poorer people are to their incomes. A further reason is based upon the supposition that large incomes involve a considerable unearned increment, in the shape of rent or extraordinary profits, because of accidental opportunity or the crowding of population. An income tax, carefully graduated, is supposed to cause such extra privileges and opportunities to bear a fair share of government expenses.