excess dividends might "save the situation" afterwards. When a business
is successful, paying, as many businesses have recently done, dividends
of 30 to 50 per cent., and sometimes even more, the return made to those
who have invested money in them is clearly excessive. From such
profitable businesses those who have the responsible management no doubt
may generally get better remuneration, possibly the workmen may get a
small bonus or share in such profits, but those who by a mere stroke of
good luck have embarked their money in these businesses, shareholders
who very likely know nothing whatever about the conduct of them, benefit
enormously. Such a tax would not discourage thrift or prevent a person
from getting a reasonable return on his savings. Take the case, say, of
two professional men. Both, by hard work and using up their lives in the
effort, manage to make a fair income and bring up their families. One of
them, to make provision for the future, invests £2,000 in safe
securities with fixed rate of interest, and £2,000 in some company whose
business is of a more or less speculative character, but by good fortune
becomes able to pay a dividend of 30 per cent. The other invests a like
sum in firm securities, and £2,000 in another company which turns out a
failure. Neither of them has anything to do with the conduct of the
business of the company in which he invests, but one has got a tip from
some friend or other who thinks he knows of a good thing. The work of
the two men is exactly the same; it is a mere fluke that one gets a huge
return and the other puts his money into a company which, without any
fault on his part, brings in nothing.

The tax suggested would be levied on the excessive profits distributed
in respect of the capital embarked in businesses of every kind. It was
pointed out long ago that a tax thus levied on all alike would be paid
wholly by the capitalist and "would neither affect the prices of the
commodities produced nor the distribution of capital." The duty might be