Home >> The-science-of-finance >> Administration Of The Tax to Voluntary Aids >> The Nature of Self Government

The Nature of Self-Government

THE NATURE OF SELF-GOVERNMENT.

§ 135. The immediate point of departure for the present discussion is afforded by certain discussions of a general char acter inserted in the earlier portions of the present work, inci dentally to the course of the exposition ; as, e. g., what has been said in the present volume touching the evolution of the state (especially secs. 27-30), and the discussion, in the first volume [Grundlegung], of Coercion and Spontaneity (vol i. secs. 290-292).

We shall here have to devote a separate chapter to the con sideration of voluntary contributions to the public establishment and the question of their relation to compulsory contributions, that is, to the great mass of taxes, and also how far and why they are adequate or inadequate to supplement the taxes.

In view of the still very considerable vogue, and in part well grounded and very gratifying vogue of a predilection for the spontaneous action of public spirit, as contrasted with state com pulsion and the sacrifices imposed by compulsion, it is particu larly desirable to come to a clear appreciation of the position which holds self-government to be of the nature of a political organ, and so removes it from the sphere of " Voluntaryism " (as it is latterly styled by the English) and draws a distinct line of demarkation between these two disparate spheres of activity, by pointing out the intimate and indissoluble relation in fiscal matters between self-gov,ernment and the national administration.

§ The widespread admiration of English political and industrial life rightly makes much of that characteristic feature of personal initiative, which relies much on itself and little on the helping hand of the state.

We are all well aware that not only is the factor for which this concept stands an indispensable prerequisite to any sound and virile commonwealth, but also that in this respect the Eng lish type offers a particularly sharp contrast with what we are accustomed to on the continent,— a pattern from which we have already learned much, and from which we have much yet to learn.

It is however necessary, here as in every case of strongly developed individualistic tendencies, to go into a somewhat detailed analysis. It is necessary to take explicit account of a certain ambiguity in the relation of this individualism to the com monweal and to the proper performance of the state's functions.

What is necessary to an adequate recognition of this relation is a profounder appreciation of the fact that wherever individual activity comes into play in relation to the commonwealth, the quality of the activity put forth is of at least as great impor tance to the discussion as its quantity ; or in other words, the measure of its consonance with the purposes of the community is quite as much to be considered as the measure of its scope and intensity.

The more this consideration is pushed into the background,— the more stress is laid on the strength and volume of individual activity, without asking how far the energy put forth goes to serve the ends of the community or how far it is intended to serve those ends, the greater is the danger that we shall come to make the brute intensity of purpose of the speculating man of business the center of our concept of a free commonwealth.

The quality of these individual activities is of the greatest consequence ; the standard of valuation, to be derived from such qualitative appraisement and to be applied in rating the com plex array of these activities, is of importance.

Here we have, in its crudest form, the entire system of indi vidualistic endeavor, whose sole aim is the individual gain of the undertaker. The most convenient, most plausible view, the view which deals most indulgently with the weaknesses of human nature, goes on the presumption that all the business of human society may safely be entrusted to the keeping of such a system as this. For such a position flatters the callow egotism of the business mind with the acceptable conceit that in its striving the highest possible profit for itself it is at the same time a benefactor of mankind.

In point of fact, human society is not so advantageously placed. The harmonious interplay of individual activities is a dream which has never come near being true. What there really is for us to do is to reach an understanding of the narrow limits within which it is possible at all that this crudest development of individual endeavor can suffice for the purposes of the com monweal. It does, in fact, suffice for all matters that lie suf ficiently near to the habits of thought of everyday people, so that the barriers of egotism—on part of those with whom it lies to make provision and of those for whom provision is to be made — will not hinder an adequate provision for the wants of society. As concerns the great mass of everyday wants, the palpable physical needs of mankind as commonly understood— food, clothing, shelter, etc.; here the service may be rendered and may be rated with tolerable accuracy by the ordinary meth ods of the market, between producers and consumers, sellers and buyers.

Whenever these limits prove too narrow, other forces, of a higher, ethical order must come into play.

§ 137. A higher stage has been reached when the individual comes to a consciousness of the fact that his work-day self seeking alone is not sufficient to insure the existence of society, and that nobler impulses are necessary for the purposes of social life.

It is a very acceptable, and therefore well accepted view, that these indispensable nobler emotions are to be had in suffi cient quantity spontaneously, if not as a general rule, at least in the case of modern bourgeois society. They are conceived to be present at least in a measure so far adequate, that if only the state, with its coercive power, were willing to desist from what It need not undertake, there would be required but a slight rem nant of its present activity. This view, too, is based much less on the actual facts of the case than on a seductive self-delusion, which sets up as the criterion of a desirable organization of social life the natural antipathy of men to any political restraint, how ever necessary.

As a matter of fact, the nature and scope of the functions whose performance is necessary in order to the social intercourse of civilized men are such as to require the extensive exercise of ethical springs of action, lying far beyond the bounds of self interest. In Chapter III. above (secs. 79-91), in the course of the economic analysis of the services rendered by the public admin istration, we have seen what are the reasons for this being so. Partly they are functions which lie so entirely beyond the scope of self-interest that the private individual is even unable to com prehend what may be for his own interest ; paIrtly they are func tions which stand in sheer contradiction to all selfish considera tions and call for a distinct sacrifice of self-interest. In either case it is necessary to lift the every-day man above the sphere of his habitual interests and activities. In either case spontane ous private initiative will contribute in but a very modest degree to this end, and coercion by the state must be resorted to.

But inasmuch as we found, in the course of the general dis cussion in Volume I., that in the last analysis any absolute contradiction between this state compulsion and the voluntary motion of the individuals is a psychological impossibility, inas much as the question, in point of fact, is always one of expedi ency, concerning a series of intermediate links between these two elements,—this relation being moreover involved in the con stitution of our modern commonwealth ; therefore it becomes a question of the proper intermediatory mechanism which shall serve the purpose of this voluntary motion, in the guise and with the prestige of public institutions, and so help it to the adequate achievement of its national mission in the state.

Such is the foundation on which is reared the system of self government.

§ 138. It is eminently the business of the Science of Finance to study diligently the interplay of coercion and voluntarism as it appears in the system of self-government.

The development of the public revenue, the tedious rate of progress in the tax system and its various branches and forms, is closely related to this fundamental idea. Even the compul sory measures of the most heartless despotism are remarkably impotent to hasten the course of this evolution ; and under con ditions of the highest degree of political development hitherto attained, the achievements actually possible have been possible only by virtue of a nice adjustment of coercive measures to the actually available degree of more or less whole-hearted readi ness to stand by the commonwealth.

Those requirements of modern national constitutions which are all intended to secure a large participation on part of the body of citizens in the formation and achievement of national aims, immediately set the factor of popular initiative in motion against any ex parte development of coercive measures by the central organ of the state. In consequence of these favorite constitutional maxims, the acceptance of the principle of popular sovereignty involves the incorporation of this concept of organ ized public coercion with its opposite, the concept of a myriad headed individual will. The nearer we approach the attainment of this result in the constitutional development of any particular state, the greater is the degree of political maturity, or in other words, of ethical maturity, presumed on part of this collective mind of the multitude ; and the less nearly this presumption is justified, the greater a source of danger to the commonwealth does this public mind become.

In this dilemma there is no expedient left but a prudent combination of these two factors of coercion and spontaneous action. Hence a long-continued, gradual education of an ever larger number of citizens in the discharge of public duties.

§ 139. Among current conceptions of the nature of self government the following are to be noticed.

The most widely accepted view is that which simply makes individualism, as such, the essence of self-government. This view is to be rejected, as being disproved by the argument of the foregoing paragraphs.

In sharp contrast with this view is that advocated by Rudolph Gneist ; a view which he bases on the system of English Consti tutional Law and English self-government, and which he has repeatedly published during a period of several years past.

This view of Gneist's is to the following effect : Self government is a method of national administration, a second, supplementary agency for the execution of the national will. It comprises the performance of such functions as are adapted for administration by the vicinage. All offices under self-govern ment are offices in the full sense of the word, inasmuch as self government rests on authority delegated to the communes by the state. The extent of the sphere of self-government is accordingly determined by national exigencies, not by the inter ests of particular social classes that may seek an accession of power. English legislation has been guided by the principle that the local unit should be called on for the rendering of per sonal service and the contribution of rates to the extent of its capacity ; what may be needed in excess of this is borne by the county ; what passes the county's ability is to be performed by government officials and national funds. The resulting "decen tralization" is a decentralization of the administration only, not a decentralization of legislation and taxation. But inasmuch as all public burdens, whether of a personal or of a material sort, are opposed to the most obvious interests of the citizens, there can be no self-government without a seriously accepted and legally enforced constraint. Self-government, in that it makes certain official duties obligatory on the propertied classes, brings prominently into view the ultimate connection of state and soci ety in all their parts and in the affairs of everyday life.

Such is the nature of self-government according to Gneist, as he finds it in operation in the English commonwealth, and as he presents it as a model for Germany.

Lorenz von Stein thinks otherwise.' He finds that within the aggregate structure of self-government there are two great divis ions, essentially distinct in character : the organs of self-govern ment proper, and associations. Both of these, according to Stein, are of the nature of public personalities. Under the first head he classes not only so much as what, according to Gneist, exhausts the concept of self-government, but also corporate bodies [Kiir perschaften], whose purpose is the performance of a definite administrative function by means of a definite capital, and whose several varieties fall into three distinct groups— corporations proper, charitable foundations, and public stock. The "asso ciation system," above spoken of, constitutes a part of the ma chinery of self-government in so far as the associations or com panies in question exist for "administrative" purposes, and (as distinguished from business partnerships) employ their capital for the performance of an administrative function at the same time that, in performing this function, they afford a revenue to their members. The two typical examples of this class of " admin istrative " companies are joint-stock railroad companies and joint stock banks of issue.

It will be seen that this broader concept of the nature of self government comprises under the idea of self-government matters which the view held by Gneist will distinctly exclude. On the

one hand, while charitable foundations and the like do their work under state supervision, they, are nevertheless voluntary organ izations (in which respect they are unlike the governmental communal mechanism of administration); on the other hand, the so-called "administrative" companies, are, in point of fact, part of that well-known system of private enterprises whose egoistic speculative working may be checked by government regulations, but which can not thereby be raised to the dignity of an organ of local self-government. If it were competent for us, to say thit governmental control of any private business enterprise may con stitute the latter an administrative organ, it would follow that this entire system of private business enterprise would be drawn bodily into the system of self-government,--and we should reach the conclusion which we have deprecated in the earlier discussion.

§ 140. But it is also possible to overrate the importance of self-government even when understood in its proper sense. The cause of so doing may be a predilection for local decentralization, as opposed to the present growing necessity for a centralized national organization. This may in part be due to a nebulous romanticism that insists on making the simple ways of life of a primitive democratic community the immutable standard for a large and highly developed commonwealth ; in part it may be a prejudice in favor of certain of the maxims of radicalism as opposed to a sober recognition of the facts of the every-day life of the modern state. These two factors conspire to tempt us to the retention of an ideal of social life which would be impracti cable for actual men in the modern state and under the conditions of modern society.

The English writer, Toulmin Smith,' is an example of a fanat ical worshiper of the democratic principles of Anglo-Saxon self government, who has become a champion of yet another type of misconceptions of the nature of self-government. He offers a mixture of profound truths and profound perversions.

Local self-government, according to Toulmin Smith, is the real foundation of any liberal constitutional government and the sole effective guaranty for the responsibility of those to whom authority is entrusted. The mechanism of local self-government alone can. adequately protect the interests of the minor civil divis ions, or afford a fair opportunity for thorough discussion and comprehension of those interests. By its means alone is it pos sible to exercise a jealous control of the encroachments to which the officials entrusted with the general affairs of the state are con stantly tempted. By its means, too, will the people best be able to comprehend and to deal with national affairs. Self-govern ment also, and especially, constitutes a safeguard against anarchy and violence, in that it accustoms the citizens to give expression to the public will by peaceful and legal means.

But these very important, indeed eternal truths bearing on the nature of every free commonwealth, are placed in a false ligh t when, as in Toulmin Smith's discussion, they are made to serve the turn of an appeal in behalf of the primitive institutions of a country, and so are held up as the sole and sufficient norm for the life of today, and are at the same time made the basis of an unqualified disallowance of all the peculiar needs incident to a great modern commonwealth.' The severe judgment passed on all centralizing measures in legislation and administration falls with unmerited harshness on the dominant parties, parliaments, statesmen, etc. This tendency to centralization in the first place goes to establish the fact that the ever-growing volume of business of a great civilized commonwealth can not possibly be managed without increasing centralization, and secondly, that in the con flict with the exigencies of this growing centralization the ancient traditions of local self-government are of constantly decreasing avail. Nor is it political reasons alone that go to lessen the rela tive significance of the institutions of self-government in the course of this shifting of governmental functions ; the fact is due also to cultural, economic, social-political mutations of a general character, changes which alter the inclination as well as the capacity of the modern citizen for self-government. Men change, and the business of the commonwealth changes as well.

The outcome of the discussion is that on these grounds, too, the sphere of local self-government is necessarily a restricted one. Within its proper bounds local self-government remains none the less essential, but it is distinctly to be relegated to this its proper sphere. Exactly where its limits lie is a point to be established by specific considerations, in part of an historic nature, in part technical—considerations with which we have become familiar in the course of the preceding (fourth) chapter.

§ 141. Self-government in all modern states, as in fact in all times, in its actual workings, is divisible into two factors—the element of personal service and the element of material aid.

In virtue of its economic nature the material aid rendered is definitely measurable sacrifice rendered to the commonwealth on the general ground of the duties of citizenship or for special cause. With this we shall have to deal in the next following section. The personal services, on the other hand, owing to their not being translatable into economic terms, belong in an indefinite region of psychology ; indefinite because of the difficulty of accurately grasping, and the still greater difficulty of defining the scope of the motives from which the rendering of these personal services proceeds. Gneist designates this class of duties "honorary offices" (Ehreniimter), as contrasted with the salaried offices of the professional civil official or the jurist ; the term "honorary" serv ing in this case mainly to express the absence of any salary. As a descriptive designation it could only serve to express the ideal to be sought after, as an appeal to the motives from which the duties of office ought to be discharged under a system of self government, without implying that these are actually the motives from which the office is ever or anywhere accepted. If such were not the case, if the so-called " honorary " office were as a matter of fact felt to be a honorific charge, in the positive sense of the term, and as fully and constantly so as the material aid rendered the commonwealth is recognized to be of an exclusively economic character, then the rating of these "honorary " offices and assign ing them their proper place in the economy of the state (or of the commune) would be a very simple matter indeed. They would then be of a distinctly non-economic character, in much the sense in which the material aids rendered are, for their part, of a dis tinctly economic character, and they would accordingly not come into consideration in the Science of Finance at all.

But in point of fact the matter is not so simple ; for, as has already been pointed out, while the thought of honorable distinc tion may be present in the case of the personal services demanded under self-government (sheriff, juryman, assessor, and the various local administrative offices), there is also distinctly present a feel ing that these duties are burdensome and therefore involve a sacrifice of an economic sort. Practically, this is made evident by the fact that, in spite of the perfect readiness of the citizens to appreciate at its full the honor attaching to an " honorary " office, such offices are economically in so sad a plight that the fact of their involving a sacrifice has to be recognized by law in the form of a salary paid out of funds derived from other sources.

§ 142. These considerations are evidently of a wider scope than the domain of local self-government alone. It is rather in the sys tem of national defense that they find their chief application. A satisfactory financial rating of this phase of the personal services required by the commonwealth, which is so great both in extent and in its importance for state and people, is one of the most difficult problems of economics.

A scientifically adequate comparison of the military burdens of states which have different systems of defense is therefore a sheer impossibility.

To construe the universal liability to military service of today as a case of an " honorary " office in the strict sense, and thereby exclude all consideration of its economic bearing on the citizen subject to conscription,—that would be impossible, unless we are to ignore the plain facts of the case for the sake of an overwrought conceit. On the other hand, to compute the burden involved (and a burden it unquestionably is) according to the standard of wages customary in industrial employment, and so encumber the finances with enormous expenses, would be very nearly as bad. For while the economic significance of military service considered as work done for the commonwealth is to be recognized, still this simple method of computing its value will never commend itself to our sober second thought. There is the difficulty, first, that it is a pretty dubious view to rate the personal burden of a universal military service simply as labor in the economic sense ; and second, even if we put aside this doubt we encounter other doubts as to how this economic burden is to be fairly rated in terms of money.

As to the first point the reflections that offer themselves are the following. As, on the one hand, it is surely an exaggeration to construe military duty simply as an honorary distinction, in order to remove all conception of an economic appraisement of human life and happiness ; so, on the other hand, it is certainly a mistake to conceive of military duty simply as a sort of statute labor, which differs from the other burdens imposed for the pur poses of the commonwealth only in being paid in kind, and is simply awaiting the time when in the course of modern industrial development it shall, like other similar relics of the past, be com muted into its money equivalent. Such a view is contradicted by the essential nature of a universal military duty, by the course of past development of which it is a product, by the great impor tance which it is conceded to have for the defense of modern civilized states. The peculiar ethical character which attaches to this way of serving one's country, and which gives it its special value as compared with any other method of national defense ; the peculiar mingling of diverse ethical factors ; the magnifi cently devised scheme of education which it comprises, serving to awaken the slumbering nobler impulses, together with much undeniable hardship and exacting service ; the beneficent influ ences of the service in the way of outward culture, hygiene, cleanliness, etc.; all these considerations forbid our treating it simply as a performance of labor in the economic sense. To say nothing whatever of that minority of the conscripts whose previous intellectual and moral training places them at the out set above the level of the great mass of recruits, to whom the element of honor in the service appeals in a peculiar degree, even when it is not all in all, and for whom the attractiveness of the service is further increased by a variety of adscititious conces sions.

So much for the first point. The second difficulty lies in the impossibility of properly rating military service as an economic fact, even after we have conceded the propriety of so construing it. The horse-breeder can readily ascertain the market value of horses, and when wanted for the army they can be taken at their customary money value. Men are reared for their own sake ; they have therefore no economic value, except, possibly, where this proposition will not hold on account of their being slaves— objects of value owned by other persons. The attempt to com pute the economic value (that is to say the loss) of the time spent in military service on the basis of the customary daily wages is nugatory, inasmuch as the able-bodied man contains only the possibility of a valuable use of his labor power, not the certainty of it. On the contrary, under the latest existing cir cumstances of the labor market it is exceedingly probable that the hundreds of thousands of soldiers, who in many states are held to service for several years together, would, in case Utopia were realized and standing armies abolished, simply encumber the labor market with their supply of labor, and would in great part be left without employment. As it is now, the population has, as it were, discounted the fact that there are at any given time so or so many hundred thousand men under arms.

Our conclusion therefore is that universal military service is a quantity not reducible to strict economic terms, and that in this respect it is but an exaggerated example of what is true of the entire personal element in the system of self-government.

commonwealth, economic, view, service and public