Home >> American-finance >> Appropriations to The National Banking System >> Expenditures in General

Expenditures in General

EXPENDITURES IN GENERAL.

1. Functions of government.

2. Public welfare.

3. Too indefinite for a basis.

4. Extension of action by other countries extending.

5. Course of political parties in Great Britain.

6. The granting of pensions as an illustration.

7. Per capita mode of measuring expenditure.

8. Greatest increase is for pensions.

9. Growing increase for rivers and harbors. 1o. Growing increase for the navy. II. Figures do not show what ought to be spent.

12. Comparison of salaries for public and private service.

13. Propriety of thus applying a business standard.

14. Duty of an individual to serve the state.

15. A liberal salary as a moral safeguard.

i6. Classification of expenditures.

17. Necessary expenditures.

i8. Distinction between these and expenditures for the public welfare.

19. Necessary character of local expenditures.

20. Line between justifiable and necessary expenditures.

21. Postoffice is a justifiable expenditure.

22. The express business.

23. Necessity is a better ground for expenditure than public welfare.

24. Unequal benefits when this line is passed—River and harbor expenditures.

25. Ought the state to attempt to equalize social conditions through taxation ? 26..If so. who should be aided.

27. What test shall be applied in making the selection.

28. Does the improper acquisition of wealth justify the state in doing this.

29. It should aid the true owners in recovering their wealth.

30. Money not taken by the state is used by its members.

32. The state does not use its income more wisely than its members use theirs.

33. Difference in the modes of use by state and individuals.

34. The comparative length of their disuse of capital.

35. State aid to the needy.

36. Limitation beyond necessary and justifiable expenditure.

37. Later changes in class or special legislation.

38. Growing discontent from increasing appropriations.

39. They should be kept within the smallest limits because the burden is unequally borne.

40. Such expenditures are ineffective as a method of equal izing unlawful wealth.

41. Effective action as a test of limitation.

42. Moral aspect of expenditure.

1. Among political philosophers no chase has ever been more fascinating than the chase to find out the cor rect functions of government.' As no answer has been found commanding permanent or general acceptance, so among the rulers no course of conduct has ever been very consistent. The modern tendency in governing is to widen the functions of the state, especially since the extension of the suffrage.' 2. Much of the present legislation is based on public welfare. Broad and indefinable, many are conjuring with the phrase to-day as they never did before. The courts, in trying to set more effective limitations to the phrase, have only succeeded in entangling themselves. On one of these occasions the chief justice of the Court of Appeals of New York admitted that the boundary of legislation in laws of this character was "indistinct," and that no rule or definition could be formulated under which in all cases it could be readily determined whether a statute did or did not transgress the fundamental law. If judges can find no distinct boundary, what may be expected of legis lators who are intent on using legislation chiefly as a means for attaining personal or party ends ? 3. It may be urged, to lessen the fear of walking by this dim, deceptive light, that the constitution must not be made too rigid, that the people must have room to expand.

The constitution must indeed be something more than a mere piece of mechanism, a code of unbending rules. If the people grow, so must the constitution under which they live. Yet we must be careful in expanding not to risk unduly what we have. Surely the need exists of checking, to some extent, the current of state action from becoming strong enough to sweep away the barriers that protect the rights of individuals.' 4. In other countries as well as our own legislators have been widening the circuit of state action, and for the same reasons : First, in response to the general belief that the public will be benefited and is therefore desirous of having the state undertake such action ; secondly, as a party measure to catch votes ; lastly, for a personal end, to strengthen the power of those who have the dis posal of the offices thus created, and indirectly the con duct of them.' These three strata, of varying strength and thickness, form the foundation of the modern exten sion of state functions, and also, to a considerable extent, of the larger expenditures incurred for the older and un questioned functions of the state.

5. The most curious thing about this movement in Great Britain is that the Liberal party, which, half a cen tury ago, led in the new crusade for restoring man's rights, is leading, though the other is following not far behind. That consummate party leader, Disraeli, as soon as he had risen to leadership, taught his followers how to catch the newly enfranchised voter by adopting the tactics of his opponents and promising still more.' And since his day the party fishermen have been more active than ever, while the dominant party always keeps a goodly quantity of tempting bait on hand in the form of unfinished legis lation.' 6. A more specific illustration may be given. During the Civil War many, opposed to the cause of the Union, were very free in their utterances. The friends of the Union were denounced, especially the soldier and sailor.

Since 1862 a system of pensions, established for their benefit, has grown into marvelous proportions. The hope of winning voters has been a strong stimulus with many a cultivator in this field of legislation. During the debate in Congress on one of these measures a most notorious op ponent to the cause of the Union, the Union soldier and all his works, rose to the following height of patriotic agony: "No government can afford to higgle with its preservers over the price of their blood; nor is it a becoming thing to thrust a contemptible statute of limitations, the last resort of a dishonest debtor, into the faces of the maimed who are living or of the widows and orphans of the dead, in full payment of the most sacred obligations ever incurred by a nation in the history of the world?" No member on the other side could beat this. As experience has clearly shown that voters do not long remember whence legisla tive rewards come, perhaps the time is not far off when all parties will admit the uselessness of longer using per sonal and class legislation as a means for gaining and re taining ascendency.

7. The most common mode of measuring expenditure is the per capita one. Measured by this, national expendi tures have been rapidly increasing. In 1830, excluding payments on the principal and interest of the public debt, they were $1.03 ; in 1840, $1.42; in 185o, $1.71 ; in 186o, $2.01; in 1870, $8.03 ; in 1880, $5.34; in 1890, $5.07; in 1891, $5.71 ; in 1892, $5.27 ; in 1893, $5.73 ; in 1894, $5.37 ; in 1895, $5.10; in 1896, $4.94; in 1897, $5.55 ; in 1898, $6.46 ; in 1899, $8.29.'a 8. The greatest increase has been for pensions. The sum thus expended for 1896 was $139,434,000. In 1861 the amount paid for pensions was $1,072,461, which had increased at the close of the war to $8,525,153. Five years afterward, in 1870, the amount was $27,780,811. For nine years longer the annual amount paid did not go beyond $33,780,526. But the next year, 188o, the figures rose to $57,240,540, and in 1890 to $106,493,890. Three years afterward the figures were $161,774,282, then slowly receded, but are again rising, and will be doubtless largely swelled by payments to the sufferers by the Span ish war.

9. Another rapidly increasing expense is for improv ing rivers and harbors, as the following figures show : 10. Another increasing expenditure is for sea coast defense and for building ships: 11. These figures throw no light on the question, What ought to be spent and what obtained in the way of security, justice and general comfort for the expenditure? But they do show how rapidly national expenditure is in creasing.

12. Perhaps a better mode of measuring public expen diture is to compare the sums paid to employees with the sums paid by private employers for similar services.' Those employed in the classified service are divided into eleven classes. Those in Class A receive any amount less than $270. Class B, $720 to less than $840. Class C, $840 to less than $90o .

Class D, $9oo to less than $1,000. Class E, $1,000 to less than $1,200. Class 1, $1,2oo to less than $1,400.. Class 2, $1,400 to less than $1,600. Class 3, $1,600 to less than $1,800. Class 4, $1,800 to less than $2,000. Class 5, $2,000 to less than $2,50o. Class 6, $2,500 or more.

For those who fill the higher places the reward is in deed small enough (too small in many cases), when they are competent and perform their duties. For those be low, the compensation is certainly much higher than they would receive from other employers for similar services. It will not, we think, be questioned that a clerk who receives $1,800 in a public position is more skillful or competent than one receiving $I,2oo in a bank or counting-room in New York, Philadelphia or Chica go. While he was cursed with the fear, or rather the certainty, that his position was insecure, he may have been justified in demanding, and the government in pay ing, more than ought to he demanded and paid now that his tenure of office is permanent. But since the adoption of civil service rules, why should the govern ment pay higher prices than individuals or private com panies pay for services of a similar character? If this test were applied, it would clearly appear that the gov ernment is paying a much higher compensation than is paid outside.

13. Again, it is maintained that the state ought to pay liberal salaries because it is undignified and small to apply the ordinary business standard in compensating servants of the state. Public offices may be divided into two classes : the higher, to which some honor is attached ; the lower, which are respectable and can be easily filled, but which are without special honor. To officers of the latter class we know of no reason why the same rules should not be applied as corporations or individuals apply to their employees. For those holding the higher positions, as honor is the reward in part for the services rendered, they ought not to expect to receive as much as other persons holding high positions of a less public or honorable nature.

14. In the olden time it was thought, too, that one had some duty to perform for the state. Does this no longer exist? If it does, ought a high official to expect that his compensation will be gauged solely by its money value ? is. It is sometimes said that all employees ought to be liberally paid to keep them from temptation. Of course, all should be paid a sufficient remuneration, which, if wisely used, would support them in a comfortable man ner. To prevent catastrophes springing from an in sufficient remuneration, the same principles should be applied by government as are applied by corporations and individuals in rewarding their servants.

16. A better comprehension of our expenditures can be gained by dividing them into three classes—necessary, justifiable and questionable. Thus classified, it is not diffi cult to determine what expenditures are necessary. It is not so easy to separate the rest into the second and third classes.

17. A public expenditure incurred from necessity, or which is clearly justifiable, because incurred in perform ing a service generally and unquestionably desired, like the management of the postoffice, rests on a sounder basis than many of the expenditures based on public welfare. It is difficult to imagine a law, not positively wrong, that does not yield some benefits. Whisky is often used in improper ways, yet many derive great benefit from its production. Persons are employed in the distilleries, farmers find a market for their grain, and, in turn, employ to produce it others who are thus enabled to earn means of buying clothing and food. Indeed, the chain of bene fits continues until one is lost in his search for a begin ning. In like manner, in performing almost every public service, some persons are benefited, others are injured. What are the general results? They are conflicting. But no such results follow expenditures for defense and jus tice. There may be inefficiency, wastefulness or fraud in making them, causing dissatisfaction ; but the necessity of the objects for which they were made is not questioned.

18. The inquiry may be raised : Is not an expenditure incurred from necessity or for the general welfare the same thing? A necessary expenditure is for the general welfare, but an expenditure for the general welfare may not be necessary. A necessary expenditure is for the welfare of every.member of government ; all are benefited and in the same way. The building of a railroad may promote the general welfare ; but those who live near the line will profit by it far more than those who live far away. This is true of many undertakings based on the general welfare. The effective administration of justice and maintenance of defense is for the good of all, man and woman, old and young. Furthermore, a necessary ex penditure is an indispensable condition of maintaining government; an expenditure based on the general welfare may not be.

19. Again, as we draw closer to local government, ex penditures partake more of a necessary character. What ever may be said concerning corrupt methods of govern ing, nearly every object of local expenditure is necessary for the security and health of the people and the trans action of business.

20. The line between questionable and justifiable expenditures cannot always be clearly drawn. Ought the national government, for example, to undertake a land or geological survey within the limits of a state? Is not this a local function, not a national one? Ought not such work to be confined to the lands belonging to the United States?' Again, a service, questionable at one time, may be justifiable at another—after a state has attained greater efficiency. The national government, for example, may in time employ men so permanently as to be justified in undertaking the telegraphic service; surely it would hardly be justified in undertaking this service under ex isting conditions." 21. The postoffice is a good illustration of a justifiable service. The need is not so great as the need of defending the country and administering justice. If there were no public postoffices the people would contrive another way for sending their letters and periodicals. It is generally believed that the state can serve the people more efficiently than companies formed for this purpose ; and if the state can, it is justified in undertaking the service. Amid such a network of states personal or corporate efficiency might be impaired by public restrictions ; the national govern ment is powerful enough to protect the service from state interference. But if it is justified in carrying the mails, it cannot justly perform this service on the con tributive principle, and compel those who receive no bene fit to pay in part for the benefit of those who neither send nor receive mail matter.

22. Would the national government be justified in en gaging in the express business ? Not now, but it may be justified, by and by, in undertaking this service.

23. Necessity, rather than public welfare, is a more rational and satisfactory test of expenditure, because the former can be more easily, intelligently and justly applied. All are helped. There is no question concerning the need of defending the state and administering justice. When this line is passed, while many may be benefited by an expenditure, others will just as surely suffer. The river and harbor bill is a familiar illustration. However great may be the general benefit, a special benefit accrues to the locality where an expenditure is made. Though its river or harbor may not be deeper, labor has gained something by getting employment. The special benefit is so obvious that there is always strong opposition to such a bill."a 24. How, then, is it passed? Every one knows—by granting enough special appropriations to different places to insure the support of those who represent them. If nine millions' worth of "pork" is to be appropriated or distributed, it must be divided and subdivided until enough get aportion to form a majority of the distrib uting body. Every river and harbor bill bears unques tionable proofs of its numerous creators." 25. Many, however, contend that laborers are helped by expending money to improve rivers and harbors, erect public buildings, supervise the conduct of corporations and the like, while the people from whom the means is temporarily taken to pay them do not suffer, and in the end get back their money. And this assertion is fortified with another, that the people who thus pay ought to do more than they otherwise would to maintain others. 'Does this contention, constantly made, justify the state in with "aRep. Catchings, of Miss., in his defence of the appropria tions for the Mississippi River levees during the debate on the River and Harbor Bill of 1901, said: "While those who own the plantations in the Mississippi Valley are primarily benefited by this levee construction, ultimately many others are benefited as well. There is not a city in this country which does not find many of its most valuable purchasers in this great valley. • * • What they produce and sell constitutes a very large part of the exports of this country and helps to maintain the balance of trade." (34 Cong. Record, 1165.) All this is perfectly true, but one of the radical defects of the argument is the benefit resulting from this expenditure, however widely diffused, is so imperfectly and inadequately related to the individuals who pay for it.

Mr. Breckenridge, of Kentucky, remarked during the debate in 1890 on the river and harbor bill, reported for that year that the committee had been exceedingly industrious, and had his sincerest admiration for the skillful attempt which had been made by its members to compromise existing difficulties, and to make a bill that was as honest as they could afford to make it, and have it pass the House. 21 Cong. Rec. 5401. Bee article, River and Harbor Bills, E. R. Johnson, 2 Ann. of Am. Acad. 782.

drawing money from some of its members for the use of others? 26. If the state ought to support persons, if this be a just basis for taxation, then the initial question is, Who should be the recipients of a public bounty, and on what principles should they be selected? We know how the se lections are made, except as far as a reformed service has prescribed definite rules for regulating employment. They

are chosen as a recognition of their service in promoting the success, either directly or indirectly, of the appointing power.

27. Leaving, then, the actual method of selection, and groping around for a correct principle to apply, shall we adopt that of choosing the fittest for the service they are to perform ? If so, doubtless those would be selected who are the most competent to earn their own living without the aid of the state. Shall the least competent be chosen? If so, in many cases they would be the least worthy, al though for their unworthiness the state is not responsible. Neither of these principles will serve as a proper or safe guide.

28. Can a correct principle be more easily found for withdrawing a part of the income or profits of wealth to pay those chosen ? The justification of this rests on the assumptions : Either that wealth is improperly acquired; or, if not, that it is improperly used ; or again, that the state can use it more wisely or more justly than its pos sessor. These assumptions, from whatever side they may be examined, are fallacious.

29. The first assumption, so often heard, furnishes no just basis for taxation. Obviously, if wealth is unjustly acquired, the state should assist its true owners in recov ering it. For the state to take it indirectly from wrongful possessors and give it to others is quite as bad as for the state to take property directly from rightful owners and give it to others. By such action rightful owners are de prived of their wealth by the state, whose primary duty is precisely the opposite—to administer justice, to restore property unlawfully taken.

3o. Again, the world's wealth is employed by its own ers. If the state did not draw money from its members, they would use it themselves, and in so doing would em ploy labor. Every owner of wealth is using it, and will continue to do so as long as he can get any profit or pleasure in so doing.

31. The investing capitalist, of whom so much has been harshly said, uses his wealth quite as actively as other persons. Indeed, he is far-sighted in employing his means. In truth, he is the person against whom the least criticism of this nature can be intelligently directed. The slightest analysis is sufficient to prove this assertion. It is true that his manner of using wealth is perhaps not so conspicuous to many as the spendthrift's manner ; never theless, he expends his wealth far more intelligently and just as actively. The spendthrift uses his income in many of the most expensive ways known to modern society. At the end of the year, what residuum is left for his ex penditure ? So far as he is concerned, the remembrance of a pleasant time ; still later, the more vivid remembrance of shattered health ; yet, from his point of view, he has had his money's worth. What shall be said of his serv ants and others indirectly employed in ministering to his pleasure? They also have had a good living; some of them, perhaps, have kept a portion of their earnings ; others have spent all to supply their daily wants. Let us turn back to the capitalist. Suppose he has not employed directly a person save a servant or two who' ave kept his house. He has lent his money to others, but to whom? To persons engaged in production and exchange, to house-builders, for example. They, in turn (supposing that the income of each was the same), have furnished work to quite as many as the spendthrift has employed. We may fairly suppose that the persons employed with the money of the capitalist were paid as good wages and fared as well in every way as those employed by the spend thrift. But what, in the end, is the result? In the capi talist's case there is a permanent creation ; in the other, nothing save the remembrance of the good time. Will not every one say that from every point of view the ex penditure was much wiser in the capitalist's case than in the other? 32. The assumption that unless money was drawn from the people to make public expenditures it would otherwise not be used is worthless. Nor is the assump tion any sounder that the state acts more wisely in making expenditures than individuals would act in making them. It is true that the state might use the money drawn from taxpayers more wisely than spendthrifts use theirs. But in the majority of cases money is used far more wisely by individuals than by the state.

33. If owners were permitted to keep their money, the chief differences between their use of it and its present use by the state would be in the selection and remunera tion of persons employed. As many and as worthy men would doubtless be employed by individuals as are em ployed by the state.

34. At times capital is disused, either through lack of avenues for its employment or through some other cause, but only for short seasons. Generally, capital is promptly used and to its fullest extent ; consequently the state can not justify itself in seizing it on the ground of inability or unwillingness of its owners to use it themselves.

35. It is true that the state is justified by public opinion in getting, by taxation, the means to support those who cannot maintain themselves. In times of unusual de pression it is also justified in making desirable expendi tures, which would be delayed or perhaps never under taken, to give the people employment. Necker had the streets of Paris paved that the people might get the means to buy food. Such an expenditure, as far as possible, should be local rather than national, as it can be more economically made, and employment be more surely given to the needy and deserving. This use of funds is along the danger line, and should be limited to special occasions of unusual need." 36. Passing beyond the limits of necessary and justi fiable expenditure, what practical limitations can be set up? If a "protective" tariff is enacted, for example, ought not the government to look after our commerce, our farming, our mining and all other interests? In a rough sort of way the government is doing this, but one of the difficulties lies in the fact that the way is so rough and imperfect. The government has been putting its long and sympathetic, if not always effective, arm around many interests. It has been proposed lately that a department of mining should be established, with a chief acting as a member of the Cabinet." Some newspapers, friendly to protection, are opposed to this. How can they be and preserve their consistency? Is not the mining interest just as deserving of public recognition as manufacturing, commerce or agriculture? If the business world and for eign governments are persecuting silver miners, as many of them assert, ought not the government, to preserve a consistent policy, to fly to their relief? 37. During the last forty years there have been marked changes both in destroying and continuing class legisla tion. By enacting general laws for the creation of corpo rations special privileges have been effectually cut off. Some of the newer state constitutions forbid all kinds of special legislation. On the other hand, especially by the national government, many claims are annually paid, lands are granted, appropriations for so-called improvements are made that are personal or local. By state legislatures appropriations are made for hospitals, colleges and the like, which cause no little dissatisfaction because they par take largely ou wholly of a local character. By city gov ernments the use of streets for special purposes is granted without payment of the privilege, or an inadequate sum is paid, causing constant just criticism." 38. As no government, especially of late years, has followed a well-defined course, a condition of unrest has developed which will spread until more consistency is ob served. No government can continue to aid some classes and ignore others without spreading dissatisfaction. It cannot impose a duty on imports for "protective" purposes and compel the silver producer to pay them without con verting him into a bitter enemy unless he is protected in return. Every expenditure for a class, whether that class be few or many, arouses the opposition of other classes not benefited, or benefited in less degree.

39. No one complains over the principle on which expenditures for the national defense and foreign in tercourse and justice are founded, because all are bene fited and in equal degree, man, woman and child. But expenditures that are primarily made for the larger or more especial benefit of individuals, sections, classes, do not rest on such firm ground. And these are very nu merous and increasing. Some of them are worthy of public, but not national assistance. If the people of Boston desire a public library, it is quite right for them to have it if they are willing to pay the cost, but it would be a very wrong thing to require the people of the entire State to pay the bill. If the planters along the Mississippi desire to have the levees built to protect their lands from overflow, it is surely right for them to co-operate in building them, and also for the locali ties, cities, towns, counties, States through which they pass, to lend assistance. If it be said that the National Government ought to aid, too, because there is a gen eral benefit accruing to all, the answer, we think, is complete, that such expenditures are primarily made for the larger special benefit of the land owners, and the general benefit to the people is by no means equal to or commensurate with the tax imposed on them for the outlay. In truth, the return to them, if there be any at all, is very unequal and bearing no possible definable proportion to the burden which they, through their ignorance and weakness, are consequently com pelled to endure. • 4o. Many urge as a defense of large public expendi tures, regardless of their character, that this is a way to recover a part of ill-gotten fortunes. Without stopping to show the weakness of the defense (for evidently those who have strongest claims to unjustly acquired wealth are its true owners, and not the public), the hard fact is that the sharpers are the very class who are the most success ful in escaping the largest share of their burdens. If they have but little conscience in their methods of getting wealth, they have still less in preventing the public from taking it from them in the form of taxation. The taxes are contributed in larger proportions to income, value of property or other basis by those who have the most regard for law and conscience. As an equalizing or puniatory measure large public expenditure is a complete failure. As the burden is so unjustly laid and collected (and no knowledge is more familiar), the state ought to lessen its unjust procedure until it is able to adopt and enforce a system of taxation according more nearly with the prin ciples of justice.

41. A good working rule for governmental expendi ture is, after making necessary ones, to go only as far as the government can act more efficiently than the people can act for themselves. If this is a correct principle, then some states or municipalities would be justified in under taking expenditures that other states or municipalities would not be. For example, would a city be justified in establishing gas works, lighting the streets and supplying light to individuals? Certainly not, if the works were likely to be so inefficiently managed that the cost for lighting would be greater than by private contract!' But if the public management was honest and efficient, and all were better served than they would be by a private company, then the expenditure would be justified. All turns on the honesty and efficiency of the public service. When public morals are low, and little interest is taken in public affairs, and the persons usually selected for public service are inefficient or worthless, such a public body is not justified in stretching its functions beyond the limits of clearly defined needs. In Germany, where civil service prevails, and a very high degree of public efficiency has been attained, the state is doubtless justified in going further in serving the people than it would be here, where public efficiency is much lower.

42. Lastly, a wise economic expenditure of money is less important for the saving of money than for the moral effects of such a policy. A wise economy promotes moral ity; a spendthrift policy, public or individual, corruption and decay. Expenditure, therefore, has a strong moral aspect, and for this reason ought to have a profound in terest for all. The government cannot well play the part of a distributor of wealth. Its efforts thus far in that direction are not hopeful. The evidence of this will appear hereafter.

1 "I treat government not as a conscious contrivance, but as a half-instinctive product of the effort which human beings make to ward off from themselves certain evils to which they are exposed. If then you ask, How much government ought we to have? the only answer I can give will be, You not only ought to have, but you infallibly will have, as much govern ment as is necessary for this purpose."—Sir J. S. Seeley, note in Introduction to Political Science, 129.

• One of the newer works on political science, with special reference to socialistic and individual theories, is the State to the Individual, by W. S. McKechnie.

• In one of the most recent works treating of the func tions of the State, Prof. Pulszky remarks: "The tasks of the State decrease in proportion to the spread of culture. But as mankind advances and human interests grow more intense and of a higher order, the sphere of the operative function of the State also continually widens. Nor does it follow that, because individuals or social circles can dispense with the co-operation and with the supplementary help of the State with regard to any certain interest, that there will not arise instead in some other direction a new sphere of action, which was before = known, or could not be disclosed. • • • The State to-day effects in some directions but a small portion of what it accom plished in the same field centuries ago. On the other hand, however, It attends also to many other duties which, during preceding periods, were not accounted at all to be interests and tasks of community."—The Theory of Law and Civil Society, 146-169, 279-811.

• For a brief annual review of social economic legislation in the United States since 1890, see W. B. Shaw's articles in the "Quarterly Journal of Economics" and Moorfield Storey's in structive address as president of the American Bar Association, 1896, 19 Reports of Proceedings, 179.

5 Indeed, it may be truly said that the method adopted by the aristocratic party opposed to Gains Gracchus, which proved so successful in the days of the Roman Republic, has proved hardly less successful in our day, when applied by the Con servative party of Great Britain. See 3 Mommeen's History of Rome, Ch. 8.

o Officialism in England, E. W. Huffcut, 8 Polit. Science, p. 58; Influence of Socialism Upon English Politics, W. Clark, 8 Polit. Science, D. 549.

T 6 Forum, 542.

'a See article by C. D. Wright, Jan. number Century Mag., 1901, What the Government Costs.

o See article on the Remuneration of Public Servants, by F. D. Y. Carpenter, 135 N. Am. Rev., 175. See debate on Codifi cation of Postal Laws in 34 Cong. Record, especially 1234, 1242, 1650, 1897, 2413.

g See Townsend's Rep. H. of R. on Geographical and Geo logical Surveys West of the Mississippi, 43 Cong. 1 Ses. No. 612, May 26, 1874.

10 The Relations of the Government to the Telegraph; or, a Review of the Propositions Now Pending Before Congress for Arranging the Telegraph Service of the Country, by David A. Wells, N. Y. 1873; Dorsey's Rep. on Telegraph Lines as Post Roads, 43 Cong. 2 Ses., No. 624, Feb. 8, 1875; House Mis. Doc., 42 Cong. 3 Ses., No. 79; also Ch. X1., Sec. 10, on The Efficiency of State Railways. See an instructive article by William Hill, 3 Journal of Polit. Econ. 1.

Also Senate Doc. No. 39, 54 Cong., 2 Sess., entitled Postal Tele graph, Postal Say. Banks, Life Annuities and Pensions for Old Age in Foreign Countries.

" Necessity of State Aid to the Unemployed, Stanton Coit, 17 Forum 276; Dangerous Absurdity of Granting It, D. McG. Means, Id. 287. See Aristotle's chapters on Democrocy in his Politics; The State and the Poor, H. W. Farnam, 3 Polit. Science, 282.

1° For an earlier advocacy of this idea, see 2 Penn Month ly, 626, in 1871.

14 The writers on the relations of the State to industrial action may be divided into four classes: First, the extreme in dividualists who maintain that the State has no industrial func tion, represented by Herbert Spencer and W. G. Sumner; sec ond, those who believe that the State should exercise func tions of control over industries based on public franchises, rep resented by H. C. Adams; third, those who believe in public ownership and management of the means of transportation, communication, lighting and kindred public facilities, repre sented by R. T. Ely, B. J. James, E. W. Bemis; and, fourth, the socialistic school, who desire that the State should assume the ownership and management of all the means of production, rep resented by Frederick Engels, in Germany; Sidney Webb, in England, and the late Laurence Gronlund, in this country.

15 See articles by E. J. James, The Relation of the Mod ern Municipality to the Gas Supply, 1 Pub. of Am. Economic Association, 53; Report of a Committee on the Relation of Mod ern Municipalities to Quasi-Public Works, 2 Id. 497; Municipal Ownership of Gas in the United States, 6 Id. 287, by E. W. Bemis.

public, expenditure, government, service and ought