two, three or four of this section; or

4. Who, whether for gain, hire, reward, I manner prohibited by subdivisions one, or gratuitously, or otherwise, at any time or place, records, or registers any bet or bets, wager or wagers, upon the result, or purported result, of any trial, or purported trial, or contest, or purported contest, of skill, speed or power of endurance of man or beast, or between men, beasts, or mechanical apparatus, or upon the result, or purported result, of any lot, chance, casualty, unknown or contingent event whatsoever; or

6. Who lays, makes, offers or accepts any bet or bets, or wager or wagers, upon he result, or purported result, of any trial, or purported trial, or contest, or purported contest, of skill, speed or power of endurance of man or beast, or between men, beasts, or mechanical apparatus, is punishable by imprisonment in the county jail or state prison for a period of not less than thirty days and not exceeding one year.

This section shall apply not only to persons who may commit any of the acts designated in subdivisions one to six inclusive of this section, as a business or occupation, but shall also apply to every person or persons who may do in a single instance any one of the acts specified in said subdivisions one to six inclusive.

5. Who, being the owner, lessee or occupant of any room, shed, tenement, tent, booth, building, float, vessel, place, stand, enclosure or grounds, or any part thereof, whether for gain, hire, reward, or gratuitously, or otherwise, permits the same to be used or occupied for any purpose, or in any ARGUMENT IN FAVOR OF THE PROPOSED ACT PROHIBITING BOOKMAKING, POOL-SELLING, ETC., AND APPOINTING A STATE RACING COMMISSION, ETC.

As chairman of the Associated Horse | reiteration, the loss to all the classes of Breeders of California, which held its con- industry mentioned is enormous in the agvention on Saturday, May 25, 1912, at the gregate and will increase as our horses Palace Hotel, San Francisco, I have been deteriorate. appointed by Lieutenant Governor Wallace Major General Wood, the commanding to present to the electors of this state the general of the United States Army, has argument in favor of the initiative meas-published and repeatedly stated in the past ure to be voted on at the coming election, two years that the efficiency of the United November 5th, entitled "An act to prohibit States cavalry is fast being impaired by bookmaking and pool-selling, and to pro- the wiping out of the breeding establishvide for the appointment of a state racing ments, and states plainly that this has commission to grant licenses for horse been caused by the drastic laws against racing in the State of California, for a racing. limited period, and the permitting of wagering upon such races by the Paris Mutual and Auction Pool systems only."

on

The present law of the State of California forbidding betting on races has not produced the good result expected by its proponents. Betting in pool rooms races held outside of California has increased to a great extent while all the actual benefits from racing affecting real estate, railroads, hotels, shopkeepers, farmers and laborers have been taken from us. We have kept the evil and lost the good. We have stopped the breeding of good horses in this state, not horses solely for racing, but horses improved by the thoroughbred strain, both running and trotting, thereby nullifying the effect of a law of last winter providing that every breeding stallion must be licensed by a commission provided for in the law, and that to be so registered he must be shown to have a registered pedigree himself for generations back. In other words, we have a law providing that no horses, except those bred in a certain way, shall be entitled to a standard license, and by another law take away the incentive to breed and the opportunity to develop the horse called for by the law. We have not only done this, but we have taken away from the small farmer, to whom we look for the prosperity of our state, the opportunity to raise two or three standard bred colts each year, with the very reasonable prospect that at any time he may get one which will sell for more than the entire year's product of his farm.

We invest millions of dollars in reclamation and irrigation works; we expend enormous sums in advertising these facts to bring the small farmer here, and then deprive him of one of his easiest and best lines of profit. Not to resort to wearying

Al

General Thomas McGregor, the famous United States cavalry officer, says: "As to the effectiveness of horses possessing thoroughbred strains compared with those bred without, there can be no question. The cold-bred animal has no chance with a blooded horse at any stage of the game: he is outclassed and outmatched in every way-for speed, courage, intelligence, endurance and weight-carrying ability. most ever since I can remember, efforts have been made to secure relief through congress along the advanced lines which obtain in France, Austria. Germany, Russia, Italy, and England. I have been told that Lord Kitchener, or some other eminent foreign officer, remarked after witnessing a cavalry maneuver in this country, that we had 'everything from a Shetland pony to a Clydesdale' engaged.” Some of the members of this convention were:

A. B. Spreckels, San Francisco; Richard M. Tobin, San Francisco: Rod J. Macken

zie, Pleasanton; Frank Ruhstaller, SacraW. O. B. McDonough, San Mateo: E. J. mento; Thos. H. Williams, San Francisco; Carragher, Sacramento; Alexander Hamilton, San Francisco; Dr. W. J. Smyth, Oakland; Dr. Ray Felt, Eureka; Col. J. C. Kirkpatrick, San Francisco; Geo. L. Warlow, Fresno; Louis Pierce, Suisun; Asa V. Francisco; Chas. W. Clark, San Mateo; Mendenhall, Oakland; James Woods, San Dick Adams, Oakland; Lou Crellin. Pleasanton; D. W. Wallis, Los Banos; Eugene Lent. San Francisco; Warren R. Porter, Berkeley: J. V. Galindo, Oakland; A. B. Rodman, Woodland; Wm. F. Humphrey, San Francisco; Geo. B. Magruder, Yuba City; Harry T. Creswell, San Francisco; Thos. Fox, Sacramento; James B. Bishop, San Francisco; T. I. Sexton, Oakland: A. B. Sherwood, Stockton: Daniel T. Murphy, San Francisco; Sam Hoy, Winters; Clarence P. Waterhouse,

San

Gray, Hayward; Dr. J. M. Ferguson,
Santa Cruz.

These are in themselves evidence of the fact that the convention was thoroughly representative of all interests and from all

Francisco; Lon Daniels, Chico; S. Christenson, San Francisco; J. N. Jones, Stockton; Henry Rohner, Eureka; Joe McKiernan, San Jose: J. B. Iverson, Salinas; Thomas Smith, Vallejo; John Nowlan, San Francisco; F. W. Wright, Sacramento; Robert Johnston, Fortuna, Humboldt parts of the state. county; Chas. E. Silva, Sacramento; Chas. A glance at this proposed change in the De Ryder, Pleasanton; Thos. Coulter, Sac-law will demonstrate immediately the wisramento; Wm. M. Bryant, Alton, Hum-dom of the proposed change. It provides boldt county; C. W. Rice, Larkspur, Marin for a racing commission, appointed by the county; S. H. Burns, Santa Rosa; Fred J. governor of the state, with authority to Steer, Emeryville; Hy Hogoboom, Woodland; Charles Johnson, Woodland; W. T. grant permits for the conducting of a race Kelly, Vallejo; Wm. MacDonald, Liver- meeting-to limit the time of such meeting, more; D. McNally, Livermore; C. H. Wide- and to have general supervision thereof man, Gonzales, Monterey county; S. M. within the terms of the proposed law. It Brice, Ferndale; J. J. Summerfield, Santa permits wagering on races under what is Rosa; Frank Leigenger, Stockton; W. J. known as the Paris Mutual and Auction East, Rohnerville, Humboldt county; J. B. Maher, Santa Cruz; Ray Mead, San Jose; Pool systems, wherein the public make Herman Berg, Marysville; T. C. Horrigan, their own odds, but only within the enDixon; Del Dudley, Dixon; Peter Delaney, closure of a racetrack where the trial or Eureka; Dr. Harvey, Eureka; W. J. Ken- contest of speed actually takes place. The ney, San Francisco; Col. W. J. Hogan, Paris Mutual system is in vogue at the Pasadena; J. A. Chanslor, Los Angeles; present time on Eastern and Canadian Milo M. Potter, Santa Barbara; M. F. Tar- racetracks, and is entirely used in many pey, Fresno; Robert W. Roberts, Ferndale, Humboldt county; Clarence Berry, Los large centers of Europe, such as Paris, Angeles; Judge Tam, Bakersfield; P. W. Berlin, and other large cities. Bellingall, Oakland; E. J. Delory, Los It is expected as a result of the compleAngeles; E. S. Wangenheim, Newman, tion of the Panama Canal that there will Stanislaus county: Dr. O. C. Higgins, Por- be a great influx of population into Caliterville; Walter Mabin, Los Angeles; D. L. fornia. These people are used to racing Bechant, Fresno; Dr. Wm. Dodge, Los Angeles; Geo. P. Anderson, Ukiah; Walter under the conditions just referred to, that K. Bowker, Calexico, Imperial county; is, the Paris Mutual system, and it is the Judge C. L. Claflin, Bakersfield; R. W. natural desire to make of California as Duncan, Los Angeles; Budd Doble, Hemet; attractive a place within which to live as Frank Malcolm, Fresno; Dr. W. E. Phelps, any of the communities which they have Redlands; J. E. Connell, San Diego; Geo. left behind. In all of the large cities of Gianinni, San Francisco; Geo. W. Ford, Europe and in Canada where the Paris Santa Ana; Cornell Bros., Porterville; Thos. Ezray, Hanford; Harry Rudder, Mutual system is permitted, race meetings San Diego; Al McRae, San Bernardino; are a place where men go with their famCharles Younglove, San Luis Obispo; Gar-ilies for recreation, and if permitted in our ret Blosser, Santa Maria; J. Charlton, state it would have the same result, not Ukiah; Fred W. Swanton, Santa Cruz; only at race meetings but at our state and W. F. Ingwerson, Visalia; Harry Whaley, agricultural district fairs, which are at Tulare; J. C. Wallace, San Diego; Bert Irwin, El Centro, Imperial county; G. D. present recognized and aided by our state Armstead, El Centro, Imperial county; C. A. Schweitzer, Fresno; Ray Creswald, Brawley, Imperial county; Fred Tegeler, Bakersfield: Frank Williams, Pasadena Dr. H. T. Spence, Santa Barbara; William Rourke, San Bernardino; W. L. Scott, Riverside; Gus Lindauer, San Francisco: Chas. Donlon, Oxnard, Ventura county; J. Miller, Arrowhead, San Bernardino county; P. R. Palomeris, Saticoy, Ventura county; Julius Ebell, Santa Maria; Gus Gandrau, Sanger; J. J. Bernstine, Lakeside, San Diego county: E. Gravatt, Hanford W. W. Gallup, Hanford; Clarence A. Spencer, National City, San Diego county; L. Dobrzensky, Newman, Stanislaus county; Fred Wadham, Nestor, San Diego county; Fred Linberg, Bakersfield; Henry Struve, Watsonville J. H. Dirst, Modesto; J. N. Anderson, Salinas; C. Z. Herbert, Salinas; James Mack, Ventura; S. E. Bragg, Calexico, Imperial county; Sam Watkins, Los Angeles; W. B. Alford, Ferndale; M. Cavanaugh, Niles; Geo.

laws.

With these ideas in mind, the proposed change in our law was submitted to the citizens of this state, and while it required less than thirty-one thousand signatures to get it upon the ballot, between ninety and a hundred thousand of our people have signed in favor of the proposed change, of which number seventy-four thousand five hundred seventy-eight were signatures of citizens qualified in every way and registered since the first day of January, 1912. I, therefore, respectfully submit these views to the electors of this state, and urge upon them to cast their vote in favor of this amendment on election day in November. We feel quite certain that there will never be any cause to regret it. Very respectfully,

JOHN C. KIRKPATRICK.

ANTI RACETRACK ARGUMENT.

There should be no argument necessary against this measure. It is vicious in every way. It is only necessary for its overwhelming defeat that the voters of the state know its intent. The design of this measure is to revive racetrack gambling in the State of California. Before the people of southern California vote to do this, they should recall Ascot. Before the citizens north of Tehachapi give their approval they should remember Emeryville. When a member of the legislature

Chairman.

some years ago I introduced a bill to do
away with racetrack gambling.
In prepa-
ration of an argument, I asked the leading
bankers of the state the following question:

"What action would you take if you found one of your employees was a frequenter of the racetracks?" Without exception the answer was, in substance: "We would discharge such employee at once."

Every one knows the reason for this action on the part of the bankers. As a

HOME RULE TAXATION.

Initiative Measure Submitted Directly to the Electors.

Electors of the State of California presented to the secretary of state this petition. asking that the proposed constitutional amendment hereinafter set forth be submitted to the electors of the State of California for their approval or rejection:

The people of the State of California do or by resolution of the legislative body of

ARGUMENT FOR HOME RULE IN TAXATION-REASONS WHY CONSTITUTIONAL AMENDMENT RELATING TO TAXATION (KNOWN AS THE HOME RULE IN TAXATION AMENDMENT), SHOULD BE ADOPTED.

This amendment is an enabling act, by which any city or county may change the present unsatisfactory mode of taxation and inaugurate a better system; but this cannot be done even locally without education, and a final affirmative vote of the people of the city or county. There is no interference with the operation of the state system of revenue, nor with the present system locally, except as the locality shall determine.

At the present time most of the state revenue is derived from a gross income tax on corporations; the revenues of the counties, cities, towns and districts are mainly derived from a tax on the value of land, improvements and personal property. Formerly state revenue was derived mainly from a "general property tax," but in 1910 that system was discarded as a means of raising state revenue, except when other sources of income prove insufficient.

Some of the reasons for this change are stated in the report of the tax commission for 1906, page 9:

"The present system of taxation does not meet the demands made upon it. It is antiquated, having been adopted fifty years ago, and has not been revised to keep pace with modern conditions.

"It is full of inequalities, which impose a handicap, which only the vigor and inexhaustible energy of our people can carry. "It is a 'school for perjury,' puts a penalty on honesty, and pays high premiums for dishonesty."

Injustice of Present System. Professor Seligman of Columbia University says: "The general property tax as actually administered in this country is beyond doubt one of the worst taxes known in the civilized world. It is flagrantly inequitable and its retention can be explained only through ignorance and inertia."

Seeking a Remedy.

A great many people feel the injustice of the present system of taxation without being able to locate the exact point of injustice. Many taxpayers, particularly those of small means, instinctively feel that they are bearing more than their just burdens of taxation, and that others, particularly those fortunately possessed of lands and goods of large value, are not paying their just proportion of the public expenses.

This feeling has a real foundation in fact. It must be apparent that the value of property in small parcels can be readily ascertained, while the value of property in large units cannot be so readily ascertained. A system of taxation should be just-this must be so, otherwise government itself would rest on a foundation of injustice. We have not yet found the just system, but we should be privileged to search for it. To make such search possible is the precise purpose of this constitutional amendment.

With the constitution as it now reads, the cities, counties and districts of the state are powerless to make any change whatsoever, but the amendment provides that, by a vote of the electors, any new system may be adopted by the several political subdivisions of the state for raising their revenue for local purposes, provided it does not conflict with the state's revenue system.

Is not that fair?

Objections Considered.

The main objection to this proposal seems to be that under the power thus granted, each county and city may adopt a different system and that confusion might result. This objection is not serious.

It does not concern the state at large how any city or county may raise its revenue for local purposes; it is the concern of the people of each locality. Even F. A. Derthick, master of the State now there are different rates of license Grange, Mantua, Ohio, at a meeting of taxes in every city and county; in some the National Tax Reform Association, said: there are no license taxes. There are "For two generations the farmers of the different police regulations in different United States have in a large majority cities and counties, and yet there is no cherished the belief that a uniform rate confusion. We confess that perhaps some upon all property at its true value in large corporations, or perhaps a few indimoney was the highest conception of fair-viduals having property scattered in variness and justice between man and man. ous cities and counties of the state, might It sounds fair, but all experience and history prove that its fairness begins and ends in sound. It is false economically, for it attempts to tax representative property at the same rate as the things for which it stands This results in gross injustice to the owners of visible property, who, not being able to conceal their wealth, must pay any legal tax laid upon it."

It must necessarily follow that if the "general property tax" as a source of state revenue is unjust, inequitable, conducive to fraud and perjury, it is likewise unjust as a source of revenue for cities, counties and districts.

have to pay a little more attention to the local tax system, but that very circumstance might be beneficial both to themselves and to the local communities. Moreover, any disadvantage arising from diversity is more than balanced by the opportunities given to try out new plans of taxation, that we may select that which is the best.

It is a rule of nature that through variety improved types are developed. The just system of taxation can only be arrived at through the experiences of various taxing bodies. By giving to each city and county the right to change systems, we

will more quickly arrive at what is best. | tain classes of property from taxation, Some county or some city will develop a system that is to its advantage, and then others will copy.

Some objectors may say that the tax system of the counties and cities should be established by the legislature and not by themselves. This is in violation of the principle of home rule for cities and counties now engrafted in the constitution. That principle, as stated by our supreme court, is substantial; that the people of a given locality know their own needs and wishes better than does the state at large. A system adopted by the legislature might work to the benefit of the cities and to the injury of the country district or vice versa. Dr. Washington Dodge, assessor of San Francisco, in an address before the State Assessors' Association on this subject, says: "The state legislature must make laws that will be uniform in their operation throughout the state. No uniform legislation could ever be satisfactory to the various communities, or meet their requirements. Various counties have different problems to solve, different classes of property to assess. A financial center and a seaport city, like San Francisco, would not be in a class with an agricultural_county like Glenn, or a mining county like Placer, or a county like Mendocino or Humboldt with great timber interests."

To Stimulate Industry.

A suggestion, hardly amounting to an objection, has been made that possibly some community might seek to stimulate business and industry by exempting cer

and that this might operate to compel other communities to follow the example thus set or lose commercial prestige. It is said that this might produce internecine warfare. But this is not, warfare, it is business. If one community can stimulate business and industry by this means, it would furnish a good example for others, and soon we would see the whole state adopting the same means of "stimulating business and industry." This is really the chief virtue of the amendment. It makes it possible to stimulate business and industry.

Too long has our tax system operated to repress business and industry by placing burdens thereon which benefit speculation and idleness.

The world movements in taxation are in the direction of relieving the burdens placed upon industry and thereby stimulate it, and transfer the burden to those who live and profit from the industry of others.

And in line with this world progress is the amendment proposed with the hope that the voters will give it their unqualified approval, The state of Oregon has adopted a similar amendment; the cities of the province of British Columbia have the power of home rule, and beneficial results have been achieved under it.

It should be particularly noted that the amendment is conservatively framed, and that no change can be made without a vote of the electors. H. A. MASON,

Secretary League of California Municipalities.

ARGUMENT AGAINST HOME RULE IN TAXATION. The proposed amendment of section 81, be admitted that the property tax, as forof article XIII, will admittedly work an merly collected, is obnoxious and inequiinjustice unless complete separation of state and local taxation is effected. Such complete separation has not been attained under present laws. The increase in revenue under the plan adopted under Amendment No. 1 is not equal in percentage to the increase of the state's expenditures, and it may be said with certainty that for the year 1913, and thereafter until the law is changed, a deficiency tax must be levied upon all classes of property, thus destroying in large measure such separation of taxes. The proposed amendment, therefore, is based largely upon the uncertain effect of a law yet only partially tried, and even now subject to much litigatiɔn.

The proposed amendment lacks the first essential requisite for legislation, in that it is neither clear nor concise in its terms. While providing that taxes or exemption shall be uniform for classes of property, it does not provide how or by what authority property shall be so classified, and under its provisions local taxing bodies could make such exemption as they chose for each locality, thus absolutely destroying uniformity either in taxation or exemption. The proposed plan is not the one favored in those states which have made the most advance in reform of taxation because it seeks to localize those functions which

should be centralized so as to secure uniformity both in method of assessment and date of payment, to the end that all property in all localities shall contribute its just share to the public revenue.

It may

table. Granting this, it must be conceded that the results following the adoption of Amendment No. 1 have not fulfilled the claims of its advocates. This proposed amendment would, apparently, give any local community the absolute right to enforce such taxes or exemptions as its fancy might dictate, without regard to the effect of such action upon the broader question of uniformity of taxation, or the rights of other localities. It is said by the advocates of the amendment that the state is not interested in local taxation. The state and every citizen are vitally interested in the establishment of a just and equitable tax system. If this proposed plan 1: meritorious, why should it not be made mandatory, in order that all citizens and a' communities may receive its beneficent results? California is, at this time, attempting to fit a new system of taxation into her revenue system, and there yet is much confusion and doubt as to its effect. The proposed amendment will add to this confusion, and even if it be all that its friends claim, it must, at this time, make confusion worse confounded. Because of the objections above enumerated, and others equally forceful, the proposed amendment, it will be seen, will produce confusion, inequality, local jealousies and tend to results the very opposite of those sought by its proponents.

N. W. THOMPSON, State Senator, Thirty-fifth District.