Section 9 Deficit Spending: Problem and Reaction

• Library: Tax Law 2009

Upon taking office in 1909, Governor Herbert Hadley was presented by the 44^th General Assembly with a proposed budget deficit of $1,487,254. He immediately renewed the call for a comprehensive corporate franchise tax, along with inspection taxes on oil and spirituous liquors and an increase in inheritance taxes. He later also recommended an automobile license tax. Only the oil inspection tax and the automobile licensing taxes were approved. With savings from government reorganization and the revenues from the new taxes, state government revenues were in line with expenditures for most of Governor Hadley’s administration.

But in 1913, when Governor Elliot Major, a fiscal...