TAXATION.
Political Economy is the Science of Buying and Selling. It must
include of course in its discussions the Motives, the Methods, the
Obstacles, the Rewards, relating to Sales, which are themselves first
to be defined as furnishing the sole Field of the Science. We have now
gone through with painstaking all of these topics in order, but we
have not yet fairly struck Taxation, which is indeed in all its forms
an obstacle to Sales, and in some of them the annihilation of Sales,
but which in its nature is something much more than an obstacle,
namely, a Condition of something higher than itself. In the very
strictest sense of the terms, Taxation is not a part of the Science of
Political Economy, because it is not an essential part of any one of
those natural processes by which men buy and sell and get gain. It is
rather a Condition through Government of the successful ongoing of all
those processes. There cannot be, therefore, a _science_ of Taxes, as
there is unquestionably a science of Sales. The facts of Taxes are
artificial and governmental, the facts of Sales are natural and
original.
All forms of Production, as we have now seen, go forward in accordance
with positive natural forces and motives, which God has appointed, and
which men have a natural impulse to ascertain and generalize and
profit by; for it is Nature bids men work and save, buy and sell,
invent and transport, navigate and grow rich; but Nature has given no
whisper anywhere, at least that we can hear, about any Taxes. That is
the work of Society. That seems to be something negative, not
positive, so far as Buying and Selling is concerned. Taxation is
indeed something necessary to the social order, as men are; it
furnishes means of defence against greater evils than itself is; but
in itself considered, it is an economic evil, because it takes away
from exchangers a part of the gains of their exchanges; strictly
speaking, therefore, it cannot be made a part of Economic Science.
But, on the other hand, as we shall see at length in the exposition
that follows, all the relations of Taxation from the beginning to the
end are so ultimately connected with Exchanges, are so founded on and
limited by Exchanges, its true principles are so exclusively
economical, and its abuses are so instantly and constantly harmful to
all the ongoings of natural and profitable Trade, that Taxation must
always be treated as if it were a part of Economics. The latter is a
science, the former is an art; but the art is almost exclusively
dependent upon the principles of this one science; and a comprehensive
treatise on the science, accordingly, must exhibit all its main
bearings upon those practical rules of Taxation, which are so vital to
the happiness and prosperity of any People. All scientific Economists,
therefore, have considered the subject of Taxes to lie within their
legitimate beat. They have, however, justified the inclusion upon very
different grounds, one from another; and so far as now appears, the
present writer was the first technical Economist to disclaim in the
name of his Science direct jurisdiction over Taxation.
A careful discussion of a series of distinct though related Questions
belonging to Taxes will exhibit the whole practical matter in the
light of well-established principles of economical Science.
1. What is the fundamental GROUND of Taxes? _Government_ is an
essential prerequisite to any general and satisfactory Exchanges,
since it contributes by direct effort to the security of person and
property; and justly claims, therefore, from each citizen a
compensation in return for the Services thus rendered to him. We do
not mean to say that government exists solely for the protection of
person and property, or that all the operations of government are to
be brought down within the sphere of exchange, for government exists
as well for the improvement as for the protection of society, and many
of its high functions are moral, to be performed under a lofty sense
of responsibility to God and to future ages; nor do we mean to say
that government has not also a deep ground for its existence, in
virtue of which it may on extraordinary occasions demand all the
property of all, and even the lives of some, of its citizens; but we
do mean to say that, whatever may be conceded as the ultimate ground
of government, the matter of taxation, by which government is
outwardly and ordinarily supported, and by which it takes to itself a
part of the gains of every man's industry, finds a ready and solid
justification in the common principles of Exchange. If, as far as the
tax-payer is concerned, the exchange does not seem to be voluntary, on
a closer analysis it is seen to be really voluntary; for in effect the
people organize government for themselves, and voluntarily support it,
and there is no government separate from the will of the people.
In a very important sense, accordingly, a tax paid is a reward for a
service rendered. The service which government renders to Production
by its laws, courts, and officers, by the force which it is at all
times ready to exert in behalf of any citizen or the whole society
when threatened with evil in person or property, is rendered somewhat
on the principle of division of labor, one set of agents devoting
themselves to that work; and, notwithstanding some crying abuses of
authority which no constitution or public virtue has yet been found
adequate wholly to avert, is rendered on the whole economically and
satisfactorily. Taxes, therefore, demanded of citizens by a lawful
government which tolerably performs its functions, are legitimate and
just on principles of Exchange alone.
2. What is the SOURCE out of which Taxes are actually paid? The answer
is, out of the gains of Exchanges of some sort. Gifts aside, and
thefts which are out of the question, no man ever did, no man ever
can, pay his taxes, except out of the gains of some sales which he has
already made. Even the man who lives wholly on the interest of his
money must make a true exchange in lending it (a credit transaction),
and must already have gotten his return-service in interest, before he
can pay his taxes; personal and professional servants must receive
their wages, the outcome of exchanges, before they can possibly pay
their taxes; and men can realize nothing for taxes or other payments
from their farms or foundries or stocks in trade except as they sell
either them or their products. The more sales, the more gains, and the
greater reservoir whence taxes may be drawn. Political Economy, as the
vindicator of sales, as the defender of all legitimate gains
whatsoever, is the best possible friend of tax-payers and
tax-gatherers as such. Whatever thought or force restricts sales,
makes it _pro tanto_ the harder to pay and collect taxes, so much the
harder for a government to keep its head above water and reach the
ends of its being.
It follows from all this, by a necessary inference, that the annual
Taxes of any country must come out of the annual Earnings of the
people of that country, using the word "earnings" in its general and
proper sense. The greater the earnings _per capita_, the easier are
the taxes paid. Sir Richard Temple read an address not long since in
the Section of Economic Science and Statistics of the British
Association, some of whose results are not only interesting but also
astonishing. For instance, taking the whole population of the United
Kingdom (England, Scotland, and Ireland), without division into
classes, he demonstrates that the average of yearly earnings per head
of the population is £35 4_s._, or $171.28. This exceeds the average
earnings in the United States by 30%, £27 4_s._:£35 4_s._ It exceeds
also the average on the Continent of Europe by 95%, £18 1_s._:£35
4_s._ It falls below that of Australia only, £43 4_s._:£35 4_s._, or
19% less. Canada's average earnings _per capita_ are $126.80, or 5%
less than those in the United States, £27 4_s._:£26 18_s._ According
to the same unimpeachable authority in the same paper, the annual
income from investments is in Great Britain and the United States as
nearly as possible one-seventh of the aggregate Property in each (all
kinds), or 14%. In Canada and Australia, 18% and 22% respectively.
Undoubtedly the most profitable country in the world at present is
Australia, and Great Britain stands next. The only apparent reason why
the United States, whose natural resources of every kind are vastly
superior to either, takes the third rank is, that profitable exchanges
here are forcefully suppressed by law, and that to an enormous extent,
neutralizing natural resources and glorious opportunities for easily
acquired and widespread gains. This violent suppression of commerce by
national legislation makes it just so much the harder for any man to
pay his taxes, whether these be due to Nation, State, or Municipality.
If the reservoir be diminished the flow from it through every pipe
becomes feebler.
3. In what PROPORTION ought the individual citizens to contribute to
the fund annually necessary to be raised by Taxation? The usual
answer has been, that a man should be taxed according to his
_Property_. That is the radically correct answer, though most who have
given it have not understood clearly the meaning of the word
_property_. We have already seen that the ultimate idea of property is
the power and right to render services in exchange, and defined it as
_anything that can be bought and sold_. Robinson Crusoe, while
solitary upon his island, did not and could not have property, in the
true sense of that word. It is not the fact of appropriation that
makes anything property; it is not the fact that a man has made it or
transformed it, that makes anything property; it is not the fact that
a man may rightfully give it away, that makes anything property; but
it is the fact that a man has something, no matter what it is, for
which something else may be obtained in exchange, that makes that
something property, and gives government the right to tax it. In other
words, property consists in Values, in a purchasing-power, and not in
possession, or in appropriation, or in the esteem in which a man holds
anything he has as long as it is his own.
The test of property is a sale; that which will bring something when
exposed for exchange is property; that which will bring nothing,
either never was, or has now ceased to be, distinctively property.
This view may not seem to be as novel as it is, or it may be
prejudiced by its very novelty, but at any rate it carries along with
it that strongest of the criteria of truth, that it simplifies and
illumines a confused section of the field of human thinking; and at
the same time justifies a practice which governments have reached, as
it were through instinct, the practice, namely, of taxing men who have
neither real estate nor chattels, on their incomes from industry and
from credits.
To the general question, then, in what proportions shall the citizens
contribute in taxes to the support of government, the general answer
comes, that they ought to contribute _in proportion to the gains of
their exchanges_, of whatever kind they may be. The farm, the foundry,
the mill, the railroad, the real estate of every name; personal
property of every kind; and personal acquirements and efforts of all
descriptions, best appear, for the purposes of taxation, _through the
gains realized by means of them_. If, for any reason, any of these
become unproductive, taxes should cease to be derived from them;
indeed, must cease to be derived from them, because their owners can
no longer pay by virtue of them. It may be objected that lands, for
example, presently unproductive, may be held untaxed under this
principle, held for the sake of a prospective rise of price. Very
well; when they are sold at a profit, let the owner be taxed on that
profit: it will be time enough then, especially as men do not like to
hold unproductive forms of property. It may also be objected, that,
under this principle, wages, the result of personal and professional
exertion, would be taxed just the same as profits and rents, the
result of previously accumulated property. Very well; they ought to be
so taxed. Can anybody give a solid reason why they ought not to be so
taxed? One may say, that a professional man earning a large income, on
which taxes are paid the same as on a similar income of a land
proprietor, dying, leaves to his children no further means of earning,
while the land-proprietor, dying, does leave such means. Granted; but
the land income continues to pay taxes, while that professional income
does not! Other members of the profession will do the business which
the former one would have done had he lived, and they will pay taxes
on the income from it. What a man transmits to his children, whether a
great name or a great estate, has nothing to do with the amount of
taxes that he ought to pay while he lives.
There is an illusion about lands and real property that needs to be
dissipated before men will understand clearly the whole matter of
Taxation. Without constant watchfulness and foresight, without
constant efforts in improvements and repairs, almost every form of
realized property will rapidly deteriorate and become unproductive.
Land even in Great Britain, where land is scarce, is only worth about
twenty-five years' rent; and without the exercise of intelligence and
will property ceases to be. _Property has its birth in services
exchanged; services exchanged give rise to gains; taxes can only be
paid out of these gains; they ought to be proportioned to the amount
of these gains without any reference to the class of exchanges
producing them; while the right to tax on the part of the government
is connected with a service rendered by government, and both grows out
of and is limited by the right to exchange on the part of the
citizens._ These considerations, though they may exclude the propriety
of a poll-tax, are consistent with most other forms of taxation, and
give unity to them.
4. Does it not follow from all the preceding, that a single and
universal INCOME-TAX would prove the best form of what is in its own
nature a subtraction from the gains of the governed for the
maintenance of Government? If the approximate amount of Income could
in all cases be ascertained, and if no other form of tax were levied
upon the same persons, this would seem to be a perfectly
unexceptionable mode of Taxation. The only sources of Income are
three: Wages, Profits, Rents. It does not seem that gifts are
legitimately taxable; they lie outside the field of exchange; they
spring from sympathy, from benevolence, from duty; and while exchange
must claim all that fairly belongs to it, it must be careful not to
throw discouragements into the adjacent but distinct fields of
morals. Hence, it may well be questioned whether legacies,
bequeathments, gifts to charitable and educational institutions, and
gifts to individuals proceeding from friendship, gratitude, or other
such impulse, are properly subject to taxation. The property is
taxable in the hands of the donor, and may be in the hands of the
recipient, but the passage from one to the other ought to be
unobstructed by a tax. Gifts, then, excepted, and plunder, which is
out of the question, the sources of income are few and simple, and
there is no great difficulty in every man ascertaining about what his
annual income is. Because this income, exactly ascertained, exactly
measures the gains of his exchanges for that year, a tax upon that
income is the fairest of all possible forms of taxation, and might be
made with advantage, in time, to supersede all other forms.
Superficial objections may be easily raised, and are raised constantly
in the United States, against any form of an income-tax. Reference is
often had to our national experience with such a tax during and just
after the late Civil War. The truth is, that tax was thrown on in
addition to, and in no proper relations with, a large number of other
national taxes of all sorts, good and bad; it was no possible
experiment in Taxation, because there was no opportunity of watching
its operation separate from that of other and confused forms; industry
of all kinds was demoralized by the war, and still more by a
depreciated and abominable paper money made legal tender for all
debts; and the tax became unpopular in influential quarters for
certain reasons not inherent in the nature of the tax, and was
discontinued in consequence. In order to be fairly tested, an
income-tax should either be exclusive, all other taxes being
intermitted for the time being; or at least levied simply in itself in
connection with a few other simple taxes, each of which can be watched
in its incidence and results separately from the others.
Great Britain derives its national revenues almost wholly from five
sources; namely, (1) Excises, say £27,000,000 annually; (2) Customs,
say £20,000,000; (3) Incomes, say £12,000,000; (4) Stamps, say
£12,000,000; (5) Postals, say £9,000,000. The remaining, say
£10,000,000, come from miscellaneous sources. One feature of the
English Income-tax is, that it is varied from time to time according
to prevailing national needs, the rate having been lifted from 2_d._
to 16_d._ per pound of income, according to estimated expenditures. In
1857, it realized in our money $80,255,000. In 1866, the largest year,
our own national income-tax realized $60,894,135. By varying the rate
to the pound of income according to the prospective wants of the
Exchequer, the English have found for about forty years their
income-tax to be the most uniform, unfailing, expansive, and
responsive to control, of all their fiscal expedients.
The Prussians, too, are applying an income-tax as a means of raising
revenue with good success. There, as in England it is somewhat
complicated with other kinds of taxes, and cannot exhibit itself
altogether in its own nature as if it were _exclusive_, such as all
scientific economists would like to see it tried somewhere on a large
scale; and the Germans have a different method from the English, of
making the tax more or less flexible as circumstances vary. The
English change the _rate_ of the tax to the unit of income: the
Germans _graduate_ the tax to different classes of income-receivers.
For example, those persons having an income between 420 and 660
_marks_ a year pay 84 pennies (_pfennige_) as income-tax; persons in
the next higher class pay 164 pennies a year; those in the class,
whose maximum income is 6000 marks, pay 44 marks and 80 pennies a
year; and all persons whose income does not rise above 420 marks are
not subject to this tax. On account of hard times a few years ago,
Bismarck brought it about, that all the classes included between 420
and 6000 marks of income should be wholly exempted from one-quarter's
taxes. A _mark_ is 23.82 of our cents; and a _pfennig_ is
one-hundredth of a mark.
Besides the complete harmony of an Income-tax with the general
principles of Taxation, as already unfolded, it has several specific
advantages over other forms of Taxes.
a. It has no tendency _to disturb prices_. Were there no taxation
except on Incomes, and were all the incomes rightly ascertained, the
prices of everything would be just as if there were no taxes at all.
Taxation would then be like the atmosphere, pressing equally on all
points and consciously on none. It is through tricks wrought on
Prices, that the greatest and most widely spread injustices have been
done and suffered in this country during the past thirty years: a
depreciated Money, whether of paper or silver, raises some prices and
not others, and some prices before others, and thus distributes its
mischiefs unequally; protectionist tariff-taxes play of design
fantastic tricks with prices, raising some and depressing others, thus
working monstrous injustice on a vast scale; and almost all forms of
taxation become unequal and unjust through their diverse action on
Prices. But a universal Income-tax exclusive of all others, properly
levied and fully responded to by the payers, would have no influence
at all upon prices, could by no possibility work essential injustice,
and would be certain to be very productive without becoming
burdensome.
b. A second great advantage of such an Income-tax in such a country as
this, would manifestly be, that all men would be obliged to keep exact
pecuniary accounts; more orderly methods of Business would generally
prevail; most men would know much better than they do now how they
stand themselves, and whom of others to safely trust; sudden
commercial failures, indeed failures at all, would be less frequent
and severe; and everything in the business world would be more
aboveboard and better known.
c. A third advantage of such an Income-tax, and the chief, would be
its tendencies _to fiscal simplicity_. Complexities in the Exchequer
are always and in many ways expensive to the People. In this country,
where distinct taxes have to be paid, first to the local municipality,
then to the State, and last to the Nation, Income-taxes, were all
others abolished, would have this striking advantage, that the local
municipality might best ascertain the incomes of all its legal
residents once for all, no matter from what sources local or other the
incomes be derived; and, having collected its own local _per centum_,
the State and then the Nation would each have to collect an additional
_per centum_ on the same income for themselves. Or, better still, by
an amicable arrangement, neither party yielding up its inherent right
to tax, one set of officials might ascertain the incomes and also
collect the tax for all three governments once for all. It may be
long, it doubtless will be, before we shall ever come to such economy
and simplicity and fiscal beauty as this is; for the pride of
sovereignty is very strong both in State and Nation; each is jealous
of the powers of the other, each is fond of the pelf and patronage and
officialism connected with the gathering of the taxes, and each would
be disinclined to yield anything to the other; but the fact remains,
that, as it is of acknowledged moment to have the single Cæsar's image
and inscription on every piece of the national Money, so it is of
almost equal moment in point of cheapness and clearness and simplicity
to have the hand of Cæsar seen but once in taking in the Taxes.
Objection has been often raised to any form of Income-tax from the
publicity of private affairs resulting from it. It was just this that
proved fatal to our own first experiment along this line of national
action. But there seems to be some confusion of ideas in connection
with this phrase, "publicity of private affairs," for really, so far
as taxation is concerned, there ought to be nothing "private" about
the amount of any man's income, or the aggregate of all forms of his
property, inasmuch as every man has a _right_ to know, that all his
neighbors are contributing _pro rata_ with himself to support that
Government, which is _common_ to him and them. There is nothing, at
least there should be nothing, "private" in connection with
Government; that is the one absolutely "_public_" thing of the world;
least of all should there be anything private in the matter of public
taxes, since in bearing up the burdens of Government all the citizens
are alike copartners, and in this view and for this purpose each has a
right to demand a look into the books of all the others.
Another objection has often been raised, namely, that some men will
never give in a true return of their Income. Ah! but they can be made
to do so, as the forms are perfected, as fraudulent returns are
promptly punished by additional assessment and collection, and as the
memory and conscience of the payers are quickened by the action of a
healthful public opinion brought to bear through the annual
publication of the list of their returns. Men are not so isolated from
each other as that a man's neighbors do not know pretty well the
general amount of his income. There is the additional security of an
oath, of the fear of punishment, and of the wish to stand well with
one's class. At the worst, it may be said, that evasions and fraud
accompany also all other forms of Taxation.
5. What is the difference between DIRECT and INDIRECT Taxes? This is
an old and proper division: we must now see what is the economical
basis of it. A direct tax is levied on the very persons who are
expected themselves to pay it; an indirect tax is demanded from one
person in the expectation that he will pay it provisionally, but will
indemnify himself in the higher price which he will receive from the
ultimate consumer. Thus an income tax is direct, while duties laid on
imported goods are indirect. There has been a great amount of
discussion on the point whether direct or indirect taxation be the
more eligible form; but the reader of penetration will perceive that
there is not at bottom any very radical difference between them; each
is alike a tax on actual or possible exchanges, with this main
difference, that men pay indirect taxes as a part of the price of the
goods they buy, without thinking perhaps that it is a tax they are
paying, and consequently without any of the repugnance that is
sometimes felt towards a tax-gatherer who comes with an unwelcome
demand. Thus indirect taxes are conveniently and economically
collected. Especially is this true of impost taxes; since one set of
custom-house officers may collect easily and at once the government
tax which is ultimately paid by consumers all over the country. The
taxes also levied by the present United States internal revenue law
are indirect taxes, whereby the government gets in a lump what is
afterwards distributed over many subordinate exchanges. The
countervailing disadvantage of indirect taxation, however, is, that
the price of the commodity is usually enhanced to an extent much
beyond the amount of the tax, partly because it is a cover under which
dealers may put an unreasonable demand, and partly because the tax,
having to be advanced over and over again by the intermediate dealers,
profits rapidly accumulate as an element of the ultimate price.
Direct taxes are laid either on Income or Expenditure. As the
difficulty of a tax on a person's whole expenditure is much greater
than one on his whole income, inasmuch as the items are more numerous
and more diffused, it is only attempted to levy a few taxes on some
special items of expenditure, such as those on horses, carriages,
plate, watches, and so on; but as these do not reach all persons with
any degree of quality, they are so far forth objectionable. A
house-tax, levied on the occupier, and not on the owner, unless he be
at the same time the occupier, would be a direct tax on expenditure
every way unobjectionable. Taking society at large, the house a man
lives in and its furniture are probably the most accurate index
attainable of the size of his general expenditures. They are open to
observation and current remark; they are that on which persons rely
more perhaps than on anything else external for their consideration
and station in life; the tax could be assessed with very little
trouble on the part of the assessor; and it is well worthy the
attention of our State and National Legislatures, whether such a tax,
if more taxes should be needed, would not be more equal and more easy
of collection than any others now open; or whether it might not with
advantage take the place of some of the complicated and objectionable
taxes now laid. Direct taxes have this general advantage over
indirect, that they bring the people into more immediate contact with
the government that lays the taxes, and subject it to a quicker
supervision and more effectual curb, whenever its expenditures grow
larger than the people think it desirable to incur; perhaps they have
this general disadvantage over indirect taxes, especially over
imposts, that the number of officials required to assess and collect
them is larger, thus swallowing up a part of the proceeds of the
taxes, with this liability also of bringing the people into an
attitude of hostility to the government and to its contemplated
expenditures. But whether the taxes be direct or indirect, or
whatever be their form, except it be a poll-tax, which is questionable
at best, they are laid upon Exchanges, and are designed to withdraw
for the use of the government a part of the Gains of exchanges.
6. Are CREDITS a legitimate subject of Taxation? The answer is very
easy. Unless this whole treatise from beginning to end be unsound,
Credits stand upon the same economical grounds as Commodities and
Services, and so may be taxed for the same reasons as those may be
taxed. Whatever is bought and sold is properly enough taxed, if the
needs of the government require it, and if such taxation would be
productive and not too unequal. As Values always spring from the
action of individuals, so the incidence of taxes is upon persons
rather than upon things; and the question is what can a man sell, or
what has he already sold, on the gains of which sale the government
may lay some claim? If I have a note and mortgage on my neighbor's
farm, I can sell it at any time to a third party; it pays me interest
_ad interim_, and I can collect it at maturity. Government therefore
properly taxes me for that credit in my possession. It is a part of my
property. The holders of the government bonds occupy an economical
position exactly similar. They have a lien on the national property
and income. The credits they hold are vendible commodities. They are a
paper bearing interest. They can be collected at maturity. They are
indeed exempted by law from municipal and State taxation. That was a
legitimate inducement held out to everybody alike to invest in the
bonds. But there is no reason why the nation, having withdrawn them
from town and State taxation, should not itself all the more subject
them to their fair share of the national burdens, unless indeed it be
claimed, as perhaps it fairly may be, that the exemption enables the
government to borrow at a just so much lower rate of interest. The
income at any rate derived from the bonds should be taxed as soon as
any other income is. It is no longer any ground of merit, even if it
ever has been, for persons to buy the government debt. It is a
mercantile transaction, and should be so considered in relation to
taxes. So of other mercantile credits. They are taxable. Massachusetts
has had a great deal of trouble of late years both in the Legislature
and otherwise about the taxation of mortgages on taxed Massachusetts
farms and other real estate. The question is intricate and full of
difficulty. Some things about it, however, are clear. The note and
mortgage is a different _piece_ of property, and a different _kind_ of
property, from the real estate. It is a peculiar sort of credit. The
owner of it is a different person from the owner of the real estate.
Either bit of property may change hands without changing the _status_
of the other. The question of taxing the note and mortgage, like the
question of taxing the bonds, seems to hinge on the effect it would
have on the rate of interest of the obligation secured by the
mortgage. If the holder of the mortgage expects to have to pay a tax
upon it, he will try to get a higher rate of interest on his money
loaned and thus secured. Whether mortgagees taxed as such _can_ throw
off the tax upon the mortgagors in a higher rate of interest on the
money loaned is a point much disputed and at least doubtful. General
principles would lead us to favor the taxation of note and mortgages
in the hands of their holders, so long as such cumbersome forms of
taxing as prevail in Massachusetts are maintained. A universal
income-tax would solve this difficulty also in a moment of time.
7. Has Political Economy anything to say about the RATE of taxes per
unit of that which is subject to tax? Yes; it has an important word to
say upon that point. From the very nature of Taxes in general, and in
order that they may be most productive in the long run, as well as
discourage as little as possible the Exchanges which would otherwise
go forward, the Rate of taxes ought always to be _low_ relatively to
the amount of Values exchangeable. A high rate of tax not infrequently
stops exchanges in the taxed articles altogether, and of course the
tax then realizes nothing to the government. As the only motive to an
exchange is the gain of it, the exchange ceases whenever the
government cuts so deeply into the gain as to leave little margin to
the exchangers. The greater the gain left to the parties, after the
tax is abstracted, the more numerous will the exchanges become, and
the greater the number of times will the tax fall into the coffers of
the government. In almost all articles, consumption increases from a
lowered price in even a greater ratio than the diminution of the rate
of tax; so that the interests of consumers and of the revenue are not
antagonistic but harmonious. On articles of luxury and ostentation,
and on those, such as liquors and tobaccos, whose moral effects are
clearly questionable, very high taxes may properly enough be laid,
because their incidence will hardly tend to diminish consumption, and
it would scarcely be regretted if it did; but with this exception,
duties and taxes should be levied at a low rate _per centum_ as well
for the interest of revenue as of consumers. It is to be added,
however, that the taxes even on these articles may be too high to meet
either a revenue or a moral purpose. The internal tax of two dollars a
gallon upon distilled spirits was of this character. Experience has
demonstrated that a less tax will produce more revenue, and the
drinking of whiskey, bad as that is, is less culpable than the endless
frauds on the government provoked by the high tax.
8. What is the difference between SPECIFIC and ADVALOREM Taxes, and
why should the student take careful note of these both singly and
combined? These terms are used more particularly in relation to
Tariff-taxes, but there is nothing in the distinction itself so to
limit its application. A Specific tax is a tax of so many cents or
dollars on the pound, yard, gallon, or other _quantity_ measurable: an
Advalorem tax is a tax of so much _per centum_ on the invoiced or
appraised _money value_ of the goods subject to the tax. Specific
taxes, accordingly, are far simpler and steadier in their operation
than the others; it is easy to ascertain the weight or number or other
quantity of valuables, and then to apply a fixed ratio to them in the
way of tax; the payer knows or may know beforehand precisely how much
the tax will amount to, and consequently just how it is to affect the
profitableness of his current trade; and on these and other grounds
specific taxes are preferable to advalorem ones. To be sure, this form
of tax involves that high-priced grades of an article pay no higher
taxes than low-priced grades of the same, but this consideration is
largely overbalanced by those of convenience and productiveness.
Advalorem taxes, on the other hand, are never calculable beforehand;
because Values from their nature are variable, and as a matter of fact
do constantly vary. Imported goods, for instance, bring with them the
invoice of the seller giving the values at the place of exportation.
But the importer is by no means sure that the tax will be levied upon
that valuation. The home valuation will of course be higher, otherwise
the goods would not be imported. Whenever it becomes the policy of a
country, as of the United States at present, to keep foreign goods
_out_ to the utmost extent possible under the law, which law is itself
devised on purpose to keep them out, there will always be suspicions
and charges of undervaluations at the place of export; there will
always be a motive on the part of the foreign seller or agent thus to
undervalue the goods in the interest of the importer, so as to lessen
his tax, and so increase the seller's market; such abnormal
tariff-taxes are the enemy of mankind in general, and, therefore,
there will be no end of deceits and evasions at both terminals of the
ocean-route, and "custom-house oaths" will become a by-word of course;
the importing, or rather the non-importing, country will keep in pay
an army of spies and informers on both sides of the water in order to
prevent what is called "frauds," and another army of "appraisers" at
its custom-houses in order to discredit the invoices, and to jump at a
valuation of the goods, on which the tax shall be levied; and
honorable merchants and importers, without any fault of their own, are
liable to get entangled in the miserable meshes of such goings-on, as
happened in a memorable case in New York a few years ago, and be
mulcted in fines (perhaps to immense amounts) one-half of which shall
go to the informer.
There are too many practical difficulties connected with either of
these two forms of tax to make it proper to combine the two upon the
same article of merchandise. To combine them thus is one of the tricks
and traps of Protectionism. That makes it next to impossible for any
importer to tell beforehand what the two taxes will aggregate, and
quite impossible for any ultimate consumer to tell how much of his
price paid is due to the demands of his Government. Opening the
official tax-book at random, we quote as follows from a single page:
"Webbings, pound 50 cents, and 50 per cent"; "Buttons, pound 50 cents,
and 50 per cent"; "Suspenders, pound 50 cents, and 50 per cent";
"Mohair cloth, pound 30 cents, and 50 per cent"; "Dress trimmings,
pound 50 cents, and 50 per cent." Besides these, on that same page,
there are 14 other articles under similar compound taxes, mostly at
50 cents a pound and 50 per cent additional, this as under the Tariff
as it was 1874-83; but all these 18 articles were put in 1883 at
"_pound 30 cents, and 50 per cent_."
9. What are the economical reasons for an EXCISE or INTERNAL-TAX in
connection with Tariff-taxes for revenue? A tariff-tax, whether for
revenue or other purpose, raises the price by so much of the article
subjected to it and actually imported; now, if similar articles of the
same quality be made or grown at home, and be not subjected to a
corresponding tax, these will inevitably rise to the price of the
foreign, with the tariff-tax added, for there is no possible
competition or conceivable impulse that can keep it lower than that;
so that, in that case, the government gets in revenue, only the taxes
paid on the part imported, while the people are compelled to pay in
addition virtually the same taxes on all that part produced at home.
Why should not the government have the proceeds of the last as well as
of the first? The last is the direct result of the first. If now, a
corresponding excise-tax be put on the domestic product also, the
government will get in revenue all that the people are obliged to pay
in consequence of government-tax. This is just: the other is wantonly
unjust.
Take an illustration, please. The national Census of 1890 gives the
Pig-iron production of the Census year as 9,579,779 tons of 2000 lbs.
each. This is an increase over the production of the Census year,
1880, of 255 _per centum_,--3,781,021:9,579,779. Fortunately the
present Census adds the net imports for the two years respectively,
with these results: the _per capita_ consumption of Pig-iron in 1880
was 196 lbs., of which 126 was home production, and 70 of foreign
import; while in 1890 the consumption was 320 lbs. _per capita_, of
which 299 was domestic, and 21 foreign. That is to say, in 1880, 65%
of the pig-iron consumed in this country was of home production, and
35% was of foreign production. At that time the tariff-tax on imported
pig was $7 per ton. Government secured this tax on a little more than
one-third of what was consumed, while a small circle of citizens
banded together for that purpose secured for themselves this tax on
the remaining two-thirds of all pig-iron consumed that year, _and the
whole people paid the tax on the entire three-thirds_. As we shall see
fully a little further on, our national Government has no
constitutional or other right to tax the people one penny except to
supply its own needs as such; if, therefore, the $7 impost per ton
were put on as a legitimate tax, there should have been an _excise_ or
internal-tax to the same amount put on the pig-iron produced at home.
That would have cost the people no more, and the Government would have
gotten twice as much more as it did get from the tax. If there be an
axiom in Taxation, one point indisputable by any rational human being,
it is this: _The Treasury should receive all that the people are made
to give up under a public tax._
In 1890, this particular matter came to be much more flagrant. Only 21
parts out of 320 parts were in that year foreign pig-iron; that is, a
little less than 7%, while 93% was domestic pig-iron; the tariff-tax
at that date was .3 of a cent per pound, or $6.72 per ton of 2240
lbs.; the tax was sufficient practically to exclude foreign pig,
although the Scotch pig as more fluent is very much desired here in
some branches of the iron manufacture, particularly in making steel
rails; Government received the proceeds of its own tax on only
one-fourteenth of that, which really paid the tax on its whole
fourteen-fourteenths; where did the tax on the thirteen-thirteenths go
to? If this were a matter of genuine taxation, ought there not to have
been an _excise_ on the domestic corresponding to the _impost_ on the
foreign?
Precisely that is what we do in the case of other articles not
_protectionized_. For example, in the fiscal year 1889, the excise or
internal-tax on "distilled spirits and wines" realized to the Treasury
$74,312,200, and the tariff-tax on the same realized $7,123,062,
total, $81,435,268; on "malt or fermented liquors" the same year, the
excise was $23,723,835, the impost only $663,337, total, $24,387,172;
and on "tobacco" the excise was $31,866,860, the impost $11,194,486,
total, $43,061,346. These figures are official.
An ostentatious display of private figures and price-lists is often
made, with a design to show that the prices of home-made products
protectionized are not lifted so high to consumers or buyers as those
of foreign-made products with the tariff-taxes added. The main
sophistry in these figures is this: the pure assumption, that the
_quality_ of the home-made products alleged to be cheaper than the
tax-added price of the foreign, is _the same_ as that of the foreign.
Unluckily, things are often called by the same names, and even
described by the same technical terms, which are very different sorts
of things in reality. A subordinate sophistry in these figures, often
allowed to pass, but not requiring any sharp insight to detect, is,
that the selected price-lists are not the results of an average
extending throughout years, but are _picked_ at points when (owing to
other causes than the taxes) the current prices of protectionized home
products are lower than the average of the years. One easy way to
expose the putters-forth of these figures, as not themselves really
believing in them, is, gravely to propose to lower or remove the
tariff-taxes, which (it is alleged) do not have the effect to lift
much, if any, domestic prices. This simple experiment has several
times been tried, with ludicrous effect upon the figure-mongers; they
cannot spare one iota of present taxes on foreign products: if the
smallest fraction be removed, they can no longer make and vend their
wares; indeed, heavier tariff-taxes are needed at this very moment, in
order to lift the domestic prices higher; and, presto! another set of
figures are forthcoming at once to prove the disabilities, either in
respect to Labor or Capital, under which the poor protectionized
producers are staggering in order to keep the home market!
Another complete refutation of the false position of the
protectionists, namely, that the domestics are not lifted in price on
the average to the price of the foreigns of the same quality with the
tariff-taxes added, is their utter failure and inability to project
any reason in the nature of things or the motives of men, why the
_home-prices should_ NOT _be thus lifted_! What impulse, pray, on the
earth or under the earth, can serve to depress them on the whole
average _below_ that point? Does any one say, that "domestic
competition" will depress and keep depressed the prices of home goods
of the same grade below the prices of the foreign taxes paid? Did this
astute objector ever hear of "domestic combination" to keep prices up
to the highest possible point? To shut down mills and factories, to
avoid depressing prices? To sell surplus stocks abroad for what can be
gotten for them, in order to make prices at home up to the usual
scarcity point? In July, 1890, the Boston Commercial Bulletin, the
special organ of Protectionism in New England, and special spokesman
for the wool-and-woollens industry, spoke thus of that industry, after
30 years of public hiring the growers and manufacturers to carry it on
with a _bonus_, just at a time when the worsted tariff-taxes had been
advanced, alleged custom-house frauds stopped, and still higher
tariff-taxes on their way from the so-called McKinley Bill in
Congress: "_The woollen goods industry was probably never in much
worse condition in this country. The slowness of its development may
be judged from the fact, that, despite an average yearly increase of
over a million in population, the increase in the number of wool cards
in this country is less than a hundred a year, while the proportion of
woollen machinery shut down between June 1 and September 1 bids fair
to be the largest ever known. The market is dull, deadly dull. The
large amount of silent machinery is making its presence felt. The
sluggish sales of wool are due to most of the big mills being closed.
Depression in business is the cause of so many woollen mills closing,
and the news comes this week of four woollen mills, three in the Bay
State and one in Pennsylvania, that will close for periods ranging
from two weeks to several months._"
Not only is it true, that the purpose and usual effect of tariff-taxes
is to hoist the price of domestics protectionized up to the limit of
the corresponding foreigns with the taxes added, but it sometimes
happens that the home products are carried for considerable periods at
a level a good deal above that. A conspicuous instance of this,
commented on at the time by all the Boston papers, was brought to
notice a couple of years ago in connection with the steel beams
purchased by the city for the new and noble Boston Court-House. The
beams were bought in Belgium at $28 a ton, paid at the Boston
Custom-house "_one and one-fourth cents a pound_," that is, just $28 a
ton, making their cost to the city $56 a ton. But domestic steel beams
of the same general description were selling here at $73 a ton. Their
price had been raised here twice in one summer, about fifty cents a
ton each time. One of the conglomerated curses of cutting off by law
the natural competition in such products is, that the unnatural
competition still permitted by law is sluggish in coming into
operation, and the monopoly becomes even more such than was intended
by the law.
The tariff-tax on steel rails is $17 a ton, formerly $28 a ton,
proposed in the McKinley bill to be reduced to $11.20 a ton. That
even this last is wholly needless, or any tax at all on steel rails,
is proven by the fact, that in March, 1890, Pittsburg rail-makers sold
5000 tons of rails at Vera Cruz at lower prices than the corresponding
European rails were offered for in Mexico. Another fact that proves
the same thing is this: James M. Swank, the mouth-piece of the
Pennsylvania iron and steel interests, describes the year 1885 as one
of unprecedented prosperity in the steel-rail industry, and gives a
formidable list of new establishments opened in that year. But steel
rails were much lower in that exceptional year than in any year before
or since. A tariff-tax of $5 a ton would have been in that year
absolutely prohibitory, for steel rails were worth less than $28 a ton
the greater part of that year. Yet that very year was the year of
greatest prosperity, Mr. Swank being the competent witness! But the
fact in general, which ought to overwhelm the iron and steel
protectionists with confusion, if they were capable of any such
emotion, is, that iron and steel in every form of both, owing to the
unprecedented bounty of God to this good land, costs less both in
labor and capital here than in any other country in the world. The
official figures of the current Census demonstrate this, authentic
statements of practical operators at the iron mines and furnaces and
foundries throughout the Tennessee Valley confirm it, and there is not
one particle of evidence to the contrary of any name or nature.
Let the reader notice carefully the following quotation from a private
letter to the writer, dated July 30, 1890, written by a graduate of
this college, in whom all who know him have the fullest confidence:
"_We began to open the mines here just three years ago this Fall, and
began shipping the following Spring. Our price for the ore was then
about $1.50 a ton, depending on the analysis. We mined in the
old-fashioned way--with picks and shovels--and I am safe in saying it
cost us all we got for it. I know I was continually making drafts on
my father to keep me out of debt. I did not figure on the cost at that
time--I was afraid of the figures. My only thought was how to reduce
the cost. We had a Steam Shovel in Pennsylvania, and I got my father
to send it to me for trial in this ore. We found we could use it to
advantage by using also plenty of powder, and I was soon able to buy
the second shovel. Of course that reduced the cost of production still
lower, and as there was a market for all I could do, I got the third,
and am now putting in the fourth, and the fifth is bought and to be
delivered inside of 60 days. This doubling up of the shovels made me
get locomotives to carry the ore in the mines instead of mules. I have
now two locomotives. You will understand how it would make a saving at
that point. It would require 15 mules to do that work, and it could
not be done so promptly._
_During the month of May we shipped about 14,500 tons with the use of
three shovels, and at a cost per ton for labor and fuel and powder of
33 cents. We have reduced the cost on a week's run, in good weather
and with no lack of empty cars, to 29 cents, but it never came lower
on the month's average than 33. I expect this Fall, with five shovels
instead of three, and two locomotives instead of one, to lower the
cost of production._
_Our average price at the mines is $1.20; we sell some higher. I have
just now taken a contract for 40,000 tons to be delivered between now
and the 1st of February, 1891, at $1.12-1/2. This is the lowest
contract price we have ever made, and likely that has ever been made
in this locality; but I did it to get into a different market. That
ore is to go to Nashville--a distance of 120 miles. The reason for
cutting the price to get the increased quantity I will not need to
explain to you. You taught it to me. The freight to Nashville is 75
cents. To our other furnaces in Alabama, at Sheffield and Florence,
the freight is only 35 cents. What other contracts I have at present
are at $1.25._
_With three shovels we make from 600 to 800 tons a day. With one
shovel we made from 150 to 250 a day. The variation from day to day
depends on the quality of the material we handle._
_The ore is all washed and picked and screened before it is loaded on
the cars. A very important part of the work is the work done in the
washer. It requires very expensive machinery, and the wear and tear is
enormous._
_We pay unskilled laborers ten cents an hour, skilled men as high as
twenty-five. We work eleven hours a day. Our general foreman gets $100
a month._"
Sugar and Molasses brought in through the tariff in the fiscal year
1889, $55,995,137. The quantity of domestic sugar and molasses
relatively to the quantity imported is so small, that an excise upon
it in accordance with the general principle of these paragraphs is not
worth while, but would be far more just and rational than to offer
bounties to the domestic producers out of the taxes paid by the
consumers of foreign sugar. A "bounty" in this sense is at once an
abuse of a good word, and an abomination in point of fact. For any
Government, which is nothing but a Committee of all the citizens to
attend to certain joint concerns of all, to abstract money through
taxes from the pockets of a part of these citizens in order to reward
another part for carrying on an unprofitable branch of business, is
something equally repugnant to Economy and Equality.
10. What, then, is the BOTTOM-PRINCIPLE in the Mode of Taxation? It is
this: _Relatively low taxes so adjusted on comparatively few things as
not to disturb natural prices_. The principle is simple: the problem
is difficult; but wonderfully less so the moment all attempts are
given up to foster any branch of industry whatever. Our legislators
are not called upon to foster any industries. It is out of their beat.
They cannot permanently do it, if they try; and they do immense harm
while they try. Their "bounty," instead of being a gift, as the word
imports, is a haphazard bestowment of other people's money extorted
from them by public taxes. The problem becomes simpler every year of
public experience under the practical design of so laying the public
burdens as to realize to the Treasury the most money with the least
possible interference with what would otherwise be the on-going of
Exchanges in all directions. So relatively simple and easy has the
English taxing system become, under this one leading design, that
Gladstone performed without difficulty the functions of Chancellor of
the Exchequer in conjunction with the far more arduous and complicated
duties of Prime Minister.
_Low taxes on few things._ The opposite of this principle at either of
its two points becomes at once pernicious. High taxes in general
prevent exchanges altogether, by cutting in too deeply in the gain of
them, which is the sole motive to them; high imposts prevent
importations, and of course destroy the profitable exportations
consequent to, and conditioned on, such importations; high taxes even
on few things are apt to raise prices of other articles than those on
which they are directly levied, and so become objectionable always,
and unbearable whenever it is their purpose to raise such prices:
taxes on many things, and even on few things every time they change
hands, throw an indefinite burden on Exchange, whose weight cannot
well be calculated beforehand, either by the consumer or by the
government, through uncertainty as to the number of transfers. Once
for all, and then an end. Exchanges are indeed the only legitimate
subject of taxation, but not every specific and subordinate exchange.
An attempt to tax all sales whatever was followed in Spain, and will
be followed everywhere, by a sluggish indisposition to trade at all.
Let the amount of the tax be definite, and let everybody be sure that
when it is once paid government will produce no further claim, and
industry will go along under heavy taxes better than under those
nominally lighter to which uncertainty as to time or amount attaches.
All the more advanced governments have been simplifying of late years
their systems of taxation, and collecting their revenue at fewer
points, and under more tangible conditions, in order to interfere as
little as possible with a free industry and free exchange.
The subsidiary principle is important, namely, that all taxes should
be collected by the government in as economical a manner as possible,
inasmuch as all direct and indirect costs of collection are so much
added to the burdens of the People. This covers two practical points:
(1) the number and efficiency of the tax-gatherers, and the whole
outward machinery of collection, such as the custom-houses, offices of
internal revenue, and so on. These, as they concern the whole people
equally, should be separated as far as possible from party politics,
and the inevitable corruptions thereupon attendant. All the fiscal
officers of the United States, from the Secretary of the Treasury down
to the lowest tide-waiter, are liable to be changed every four years,
and as a matter of fact are usually to a very large extent so changed,
to the great detriment of the service and ultimate expense of the
people, to say nothing of the moral losses and crevasses involved.
(2) The tax-money should be kept out of the pockets of the people as
short a time as possible, disbursement following quick upon collection.
It is poor policy to gather taxes at the beginning of the year which
will not be disbursed till the end of the year. Let the people use
their funds till they are wanted at the treasury; and if the taxes
do not then come in as fast as wanted, it is better to issue what
are called in England exchequer-bills, and in the United States
certificates of indebtedness, to be redeemed at the end of the year
from the proceeds of the taxes, than to let the people's money lie idle
in the treasury. The Secretary of the Treasury should have nothing to
do or say about the circulating medium of the country, or the loanable
price of the units of it, under any circumstances whatever. He is
neither competent enough in Knowledge nor enough established in
Integrity to be trusted with any such functions.
11. Should there be any EXEMPTIONS from Taxation? If the necessities
of the State require it, government has the right to demand from all
persons who are capable of making exchanges, and who do make them,
something in the form of taxes. But it is every way better, when
possible, that people of very moderate means should be exempted
altogether from direct taxes; and the payment of indirect taxes is a
matter more in their own option, since they are at liberty to buy much
or little of those commodities subjected to an indirect tax. In the
State of Massachusetts, incomes not exceeding $2000 are exempted by
the law. If a house-tax should be levied, all houses below a certain
grade of style and comfort should be exempted, and the tax pass up by
easy gradations from those just taxed to the palatial residences of
the rich. In the present age of the world, the well-to-do citizens of
every country are able to bear without too great difficulty the
burdens of the government, and nothing tests better the degree of
civilization which a nation has reached than the care and solicitude
it displays for the welfare of its poorer citizens.
12. Who pays the INDIRECT TAXES? At a court ball, Napoleon the First
once observed a lady noticeable as richly dressed and as wearing
splendid diamonds, and on asking her name, found that she was the wife
of a tobacco manufacturer of Paris; it occurred at once to the quick
mind of the French ruler, that the State might just as well have those
profits as an individual; and the sale of tobacco in all its forms
became accordingly a State monopoly, which now yields about
400,000,000 francs a year. That is indirect taxation. So is the
British and United States tariff and excise on tobacco. Producers and
dealers and bankers and companies add the tax demanded from them, and
sometimes more than the tax under color of it, to the price of their
wares. But it is not true that they can always realize the whole of
this enhanced price. Generally they can, sometimes they cannot. If the
article be one of necessity, or a luxury that has become equivalent to
a necessity, and there be no other source of supply than the taxed
one, then, as a rule, the tax falls wholly on the consumer, and is a
matter of indifference to the producer or dealer. But the usual effect
of an enhanced price is to lessen demand, and if the article is
dispensable, or its consumption can be lessened, or it can be obtained
elsewhere, the market will be sluggish under the tax, and producers or
dealers will be likely to tempt it by lowering prices, in other words,
by sharing the tax with consumers, and paying that share out of
profits. This is the principle. Producers and dealers would rather the
tax were off. Consumers generally, but do not always, pay the whole of
it.
13. What is to be said about the DIFFUSION of Taxes? David A. Wells,
an admirable and indefatigable authority on all practical questions in
Economics, though perhaps less skilled in scientific classification
and generalizations, several years ago made somewhat prominent in
public discussion the tendency of Taxes _to diffuse themselves_. Much
more has been written about this than is actually known about it. By
Diffusion is meant that it does not make so much difference upon what
or upon whom a tax is originally levied, because the tendency of
things is to _diffuse it_, that is, to compel others to assist in
paying the tax. The result of much personal reading and reflection on
this point is the conclusion that taxes do not "diffuse themselves"
nearly so much as has been sometimes supposed; and that, at any rate,
it is a good deal better to take the taxes from those who ought to pay
them, than to lay them at random, and then to trust some unknown
forces to make them afterwards just. It is certain that _some_ unjust
taxes cannot be diffused; for example, the protective tariff-taxes
paid by the farmers upon articles of necessary consumption. These
taxes have no tendency to raise the price of the farmers' produce, for
_that_ is determined by the foreign market, to which large parts of
the produce are exported. For such taxes the farmers cannot reimburse
themselves. Taxes that affect no prices are the best of all; taxes
that affect prices the least are the next best; and taxes that are
_designed_ to affect prices are the very worst.
14. What are the bearings of the UNITED STATES CONSTITUTION on the
whole matter of Taxation in this country? We have now seen pretty
fully, what the science of Economics has to say about the sources and
modes and results of tax-laying: but we are bound to tell also, what
the kindred but much less developed science of Politics, and
particularly what the Constitution of the Fathers, has to say upon the
same vitally important topics.
(1) The first power granted by the People to Congress, which is simply
their agent, in that Instrument from which each of the three great
Departments of Government derives all its authority, is in these
words, exactly copied from the original and official parchment in
every particular: "_The Congress shall have Power to lay and collect
Taxes, Duties, Imposts and Excises, to pay the Debts and provide for
the common Defence and general Welfare of the United States; but all
Duties, Imposts and Excises shall be uniform throughout the United
States._" This grant of power, which stands first in order, is
followed by seventeen other express powers granted to Congress in the
same eighth Section of the first Article.
There never has been any difference of opinion, and there cannot be
under such completely explicit language as this, among competent
Statesmen and Commentators, as to the exact meaning of this clause,
namely, Congress is given power to lay taxes in order to get money,
with which to pay the debts and provide for the common defence and
general welfare of the United States. That was the opinion and purpose
of every member of the Federal Convention, that framed the
Constitution in the summer of 1787; of Alexander Hamilton, who was
first called on as Secretary of the Treasury officially to interpret
it; of Daniel Webster, often called the "great expounder" of the
Constitution; of John Marshall, the great Chief Justice of the Supreme
Court; of Judge Story, the first copious and most distinguished
commentator upon the Text; of George Bancroft and George T. Curtis,
the learned and elaborate historians of the Text; and in short, of
everybody else, who has earned any right in any way to have an opinion
on any such matter of political interpretation.
Why, then, has there been from the first until now, a feeble flutter
of butterfly wings around the clause, as if, somehow or other, it gave
Congress by hook or by crook some power or other to do something
_else_ than to lay taxes in order to get money for the maintenance of
the national Government? As if there lay concealed in the language
somewhere a power to lay taxes for a purpose precisely opposite to
that expressed in the text, namely, _nominal taxes designed to
prohibit any money being gotten under them_? And why did Hamilton
himself, whose wings were those of an eagle, sweep low and hover
uncertainly about these words, and so give color to the political
historians of our time to say: "_Once more laying hold of the "general
welfare" clause of the Constitution, Hamilton here argued, under color
of giving bounties to manufactures, as though Congress might take
under its own management every thing which that body should pronounce
to be for the general welfare, provided only it was susceptible of the
application of money. Though he limited this central discretion to the
application of money, and stated some restrictions rather vaguely, the
insidious tenor of his report was to show that the Federal power of
raising money was plenary and indefinitely great._"
The true answer to these questions is a point of Grammar. The simple
English infinitive, unlike the simple infinitive of any other language
with which the writer is acquainted, _often expresses purpose_, as
well as the action of the verb without limitation of person or number;
so that, it is perfectly good English to say, "To lay taxes to pay,"
when the only possible sense of it is, "To lay taxes _in order to
pay_." Greek, Latin, and German would use here with the infinitive the
particle expressing the purpose: the English language does not. It is
not true to say, that ambiguity enters this clause, through the common
and elegant use of the simple infinitive in English to express the
purpose; but it _is_ true to say, that superficial confusion has
entered here, and a mess of bad logic. What makes it absolutely
certain, beyond the possibility of a controversy, that Congress can
levy taxes only in order to get money by means of them, is, (a) that
is the only English of the clause; (b) the "debts" of the United
States can only be paid in money; and (c) if this be _not_ the
meaning of the clause, its meaning must then be plenary, and there
would be no need or place for the remaining seventeen powers, "and all
other powers vested by this Constitution in the Government of the
United States or in any Department or Officer thereof"; in other
words, any other interpretation of the taxing clause than the plain
one would destroy the Constitution root and branch; for, if Congress
have the general power "to pay the debts and provide for the common
defence and general welfare of the United States," all other possible
powers are included in this, and President and Court disappear, and
all other clauses of the Text are a nullity.
If the above course of reasoning be sound, and he would be a bold
logician who should openly dispute it, then taxes laid for any other
end than revenue are clearly unconstitutional. The Supreme Court has
never passed upon this bald point, for it has never been mooted in
this form; but one would think, there can be little doubt how the
judges would decide in any "case" directly involving the
constitutional power of Congress to levy prohibitory tariff-taxes,
whose avowed or clearly inferrible design it is, _not_ to get money
with which to pay the debts and so on, but to cut off the possibility
of getting any money thereby. The general trend of the decisions of
the Supreme Court has wisely been, to leave in their interpretations
of the Text the widest margin of discretion to the Legislative branch
as to the best means of _raising_ revenue; but when it comes to face
the question of allowing as constitutional the best means of
_preventing_ revenue,--well, may we be there to see and hear!
(2) There are prohibitions on Congress in the Constitution, as well as
powers conferred, and among these this: "_No tax or duty shall be laid
on Articles exported from any State._" This is a part of the third
great Compromise of the Constitution, and was a concession to the
southern and planting States to make more palatable to them the power
"to regulate commerce," that was expected to be used (and was used) in
behalf of the northern and navigating States. But the concession was
more nominal than real, as the southerners found out in time to their
vexation. To prohibit taxes on exports, and to leave in full vigor the
power to tax imports, though consonant with the then prevailing
delusion of Mercantilism, is no boon to commerce in general; because,
any restriction on buying products is equally and instantly a
restriction on selling products. Exemption from taxes on exports is a
good thing in itself, but the only reason for selling exports is to
take in profitable pay the imports naturally offered against them; and
if these be restricted or prohibited, the restriction or prohibition
applies instantaneously and inevitably to the would-be exports. A
reasonable liberty of exporting is nothing, unless accompanied by a
reasonable liberty of importing, because the imports pay for the
exports and the exports buy the imports.
The southern States rejoiced for a time in this exemption-clause of
the Constitution, for their rice and cotton and indigo found no
obstacles in going out; but the only motive in sending them out was to
buy something with them to bring back; and after the snare of
Protectionism entangled the People in 1816, 1824, and specially in
1828, when the "Tariff of Abominations" was passed, the southern
people saw only too distinctly, that taxes on imports which they
wished to bring in were the same in effect as taxes on their own
exports would have been. Mr. Calhoun and the others were effectually
undeceived by the customary on-goings of commerce; and as the northern
statesmen unwisely and unpatriotically determined to crowd this iron
home in 1828, the party of the other part developed under great
provocation the doctrines of Nullification and Secession, which have
since caused a plenty of tears and bloodshed. One wrong ever begets
other wrongs. The wretched Greed of one section of the country was own
father to the wrongful Secession of the other section.
The Farmers of this country have often been congratulated on their
privilege under the constitution of exporting their agricultural
products without a tax. The congratulation is hollow. Of what use is
it to go out free and come back manacled? The ultimate is always the
return-service. The farmers are cheated. Their agricultural exports
are falling off year by year solely in consequence of outrageous
tariff-taxes on imports. In 1881, farmers' produce was exported to the
amount of $730,394,943, and that was not one-half what it would have
been under a simple and adequate Tariff for Revenues; but in 1889,
these exports only reached $532,141,490, a falling off of nearly
$200,000,000. This decline was chiefly in meats and breadstuffs. No
wonder the farmers have been complaining of terribly hard times of
late years: no wonder they are organizing "Alliances" and other
machinery for reaching a remedy: they must see clearly first where the
disease lies: the truth is, they are tariff-taxed to death: their foes
are they of their own household: Vermont, a purely agricultural State,
is the only one in the Union, that has actually _retrograded_ in
property and population in the last census-decade: those excellent
people have hugged the Tariff-delusion to their ruin; their senior
Senator, whose name is unpleasantly connected with the national
tax-laws of a generation, has never yet in the course of a long and
reputable life gained a glimmer of the commercial truth,--if men
_will_ not buy they _can_ not sell.
(3) The only other clause of the Constitution, which, as students of
Taxation, we are bound to examine, is the following: "_No Capitation,
or other direct, Tax shall be laid, unless in Proportion to the Census
or Enumeration herein before directed to be taken._" A capitation tax
is a poll-tax, which may be easily "proportioned" to the Census. It is
not clear, what is the meaning of the words "or other direct tax"; the
Supreme Court early struggled with that question, to this apparent
result, that _lands_, as the only form of property that can be
"proportioned" in their appraised value to population with any
considerable degree of accuracy, are the only "other" subject of
"direct" Taxation. However this may be, it is of considerable
consequence to note, that the term, "direct tax," as used in the
Constitution, does not correspond in its meaning to the significance
of the same term as employed in Economics. With us, a "direct tax"
means one demanded from and paid by the person on whom it is
ostensibly levied, and cannot be thrown off or forward on anybody
else; while an "indirect tax" is one which can be so thrown off or
forward.
Attention is called to the distinction here, in order to show that an
Income-tax, while in the Economical sense it is a "direct tax," is not
such in the sense of the Constitution. Objections were urged against
the late Income-tax in this country, that it was a "direct tax," and
so, because it could not be proportioned to the population, was
unconstitutional. The point is not well taken. It remains, and will
remain, after the most searching scrutiny, that an universal
Income-tax, all other taxes being abolished, is the form most
consonant with the principles of Political Economy, and not at all
repugnant to the Constitution of the United States.
15. Finally, are there any hints and guides to thought and
legislation in the matter of Taxation through an extremely brief
summary of the HISTORY of Taxes? So far as the Greeks are concerned,
they showed a practical good sense in their laws of Property in
general, and in their laws relating to Taxes in particular. The
natural march of industry and commerce was not hindered by taxation:
there was no forbidding the export of raw materials or specie; no
favoring of manufactures at the expense of agriculture; no hint of the
future Mercantilism in any efforts to preserve an artificial balance
of trade; and no taxes on imports except for purposes of Revenue.
These at Athens itself were usually 2% of the value of the goods, at
the ports of her subject-allies 5%, and exceptional cases of higher
rates than these were regarded as extortionate.
The Romans also were sensible and moderate in their modes of Taxation.
They laid taxes for the sake of getting money for the public treasury,
and had no other end in view. They knew nothing of what has since
become famous under the name of "Protectionism." Their taxes were both
direct and indirect, but especially the latter. The chief direct tax
was the land-tax, that is, a claim to the tenth part of the sheaves
and of other field produce, such as grapes and olives; and also
pasture-money (_scriptura_) demanded of those who made use of the
public pastures and woods. In Macedonia and the other larger
Provinces, in lieu of the land-tax a fixed sum of money (_tributum_)
was paid to Rome each year by each community in its own way. The
grain-tenths and pasture-moneys were always farmed out to private
contractors or companies on condition of their paying fixed quantities
of grain or fixed sums of money. The chief indirect tax was
customs-duties. There never was at any time a general tariff for the
whole empire, but there were customs-districts, such as Italy, Sicily,
proconsular Asia, the province of Narbo in Gaul, and others, each
with a sort of tariff of its own, and some with special immunities.
Goods imported by sea into Italy, for example, not for the personal
use of the importer, were subject to a tax, which seems to have been
mainly a tax on luxuries, since pepper, cinnamon, myrrh, ginger,
perfumes, ivory and diamonds, are among the dutiable goods mentioned
in one of these tariffs. Sicily had a tariff-tax quite distinct from
this, since one-twentieth of the value of the goods (5%) was levied on
the frontier on _all_ imports and exports; and a similar tax of
one-fortieth was laid by the Sempronian law on the province of Asia.
These imposts, too, were leased to contractors, which gave, of course,
some chance of fraud and wrong. There were other temporary taxes, like
those, for instance, which Augustus laid of 5% on legacies and
inheritances, and of 1% on articles publicly exposed for sale.
Green's History of England (I., 322 _et seq._) gives an outline of the
taxes there from the beginning of the monarchy. As land was almost the
only source of salable things in the early time, so it was almost the
only thing on which taxes were levied. Danegeld and scutage and feudal
aids fastened only on the land. "But a new principle of taxation was
disclosed in the tithe levied for a Crusade at the close of Henry
Second's reign. Land was no longer the only source of wealth. The
growth of national prosperity, of trade and commerce, was creating a
mass of personal property which offered irresistible temptations to
the Angevin financiers. No usage fettered the Crown in dealing with
personal property, and its growth in value promised a growing revenue.
Grants of from a seventh to a thirtieth of movables, household
property, and stock were demanded. The right of the king to grant
licenses to bring goods into or to trade within the realm, a right
springing from the need of his protection, felt by the strangers who
came there for purposes of traffic, laid the foundation for our taxes
on imports. Those on exports were only a part of the general system of
taxing personal property. How tempting this source of revenue was
proving, we see from a provision of the Great Charter, which forbids
the levy of more than the ancient customs on merchants entering or
leaving the realm. Commerce was in fact growing with the growing
wealth of the people." This passage shows, that, as a matter of fact,
_taxes_ have always hinged, and must hinge, on _trade_.
A few facts in the most recent movements of national Taxation in the
United States may fitly conclude this Chapter and this Volume. Since
1867, Wool and Woollens have been the ass, upon whose breaking back
the most conspicuous burdens have been piled; and the "McKinley Bill"
so-called, still pending at the present writing in the Senate, heaps
up still higher the groaning loads. The following table shows how
futile is the attempt to keep out wools and woollens from such a
country as ours, even by the most exaggerated barriers:--
IMPORTS OF WOOLS AND WOOLLENS.
(Calendar Years.)
--------------------------------------
| Years. | Wools. | Woollens. |
|--------+-------------+-------------|
| 1886 | $17,403,099 | $43,995,641 |
| 1887 | 15,645,020 | 45,065,986 |
| 1888 | 14,542,244 | 49,984,298 |
| 1889 | 18,696,277 | 54,080,159 |
| 1890 |(fiscal year)| 56,582,000 |
--------------------------------------
Roger Q. Mills of Texas stated from his place in the House of
Representatives in 1888, that the United States grows but about
265,000,000 lbs. of wool yearly, while it takes about 600,000,000
lbs. to clothe our own people. Why should more than half the wool
needed to clothe the people be taxed in such a way as to double (in
general) the cost of the people's clothing? And why should Benjamin
Harrison, now President of the United States, have said in that same
year, in view of these elsewhere unheard-of taxes, and in view of the
average climate of his country, that somehow it seemed to him _that
cheap clothing implied a cheap man_? In view of the enormous natural
demand for woollens, in order to keep comfortable day and night
64,000,000 of inhabitants, is it not strange, and must there not be
artificial causes for it in the kind and mode of national Taxation,
that the United States has but 16 sheep to the square mile, while
Germany has 92, France 111, and Great Britain 339?
Senator John Sherman stated in his place in August, 1888, and again in
substance Sept. 2, 1890, that a line of custom-houses on our
joint-frontier with Canada was "_the height of nonsense, and almost a
crime against civilization_." Well might he say this in view of what
his colleague, Allison of Iowa, has recently said, namely, that the
Dominion bought in 1880 of the United States 8% of its brass goods,
86% of its copper manufactures, 94% of its cordage, 88% of its
gingham, 65% of its glasswares, 99% of its rubber goods, 94% of its
printing ink, 92% of wooden wares, 91% of tinware, 90% of wall-paper,
72% of paper wares, 98% of ploughs, 97% of engines, 99% of
sewing-machines, and 90% of miscellaneous machinery.
The imports and exports of the United States for the last two fiscal
years are as follows:--
-------------------------------------------------------
| | 1889. | 1890. |
|-------------------------+-------------+-------------|
|Imports, free |$256,487,078 |$265,588,499 |
|Imports, dutiable | 488,644,574 | 523,633,729 |
|Total | 745,131,652 | 789,222,228 |
|Exports | 742,401,375 | 857,824,834 |
|Gold and Silver {Imports | 28,963,073 | 33,976,326 |
| {Exports | 96,641,533 | 52,148,420 |
|Total Imports | 774,094,725 | 823,198,554 |
|Total Exports | 839,042,908 | 909,973,254 |
-------------------------------------------------------
There two or three noticeable points from this table. First, the large
relative increase of free imports over those of former years. Free
articles in 1867 were less than 5% of the whole; in 1882, 30%; and in
1890, 33.9%. The Free List, so-called, has indeed been enlarged in the
interval, but free goods tend naturally to swell over the taxed goods,
so that in 1890 the free were almost exactly one-half of the taxed.
Second, of the large total of merchandise exports, it is to be
sorrowfully noted, that more than 82% of the whole is made up of the
products of agriculture and forests and mines (not gold and silver);
while manufactures compose only 17.8%. What ails our manufactures,
that we cannot sell them abroad? We have been for 30 years under a
vaunted scheme warranted to develop manufactures,--expressly designed
and recommended to make them cheap and good,--under an elaborate and
artificial scheme that makes everything bend, even the backs of the
toiling millions, to foster and propel manufactures! But we do not
succeed in selling much of them abroad, except some fractions of them
to Canada. The ratio of them to the total of exports of merchandise
seems to be growing less: in 1889, 18.9%; in 1890, 17.8%.
The simple truth is, that we are able to sell abroad even this
beggarly proportion of manufactures to the total exports of
merchandise, only in consequence of a shrewd device working within the
Grand Device, namely, the so-called "Free List." Some of the little
wheels within the big wheel revolve rapidly. Manufacturers do not like
to pay protectionist tariff-taxes _themselves_ any better than other
people like to pay them. They have by their own open confession in
overt act precisely the same opinion of their deadening influence,
that other people have. If, however, they can escape such taxes on the
things they have to buy, especially their raw material, and _keep_
them on their own finished goods offered for sale in a monopoly
market, they would be happy. Hence, the Free List. Hear Senator Dawes
before the Paper-makers' Convention at Saratoga in 1887: "_There is
one other feature of tariff revision much discussed at the present
time which must not escape our attention, and that is free raw
material. No industrial policy will promote the highest prosperity of
both labor and capital in this country, which fails to lay down the
raw material at the door of the manufactory at the lowest possible
cost. In any new revision of the tariff this rule of preference for
our own raw material must be adhered to by those who do not propose to
give up the American for the indifferent policy in legislating between
ourselves and foreigners._ IT WILL BE FOUND, HOWEVER, TO ADD VERY FEW
RAW MATERIALS TO THE FREE LIST, FOR THE REVISIONS OF 1874 AND 1883
HAVE ALREADY MADE FREE ALL SUCH NON-COMPETING RAW MATERIALS AS AT THE
TIME OF THE PASSAGE OF THOSE ACTS WERE ENTERING TO ANY CONSIDERABLE
EXTENT INTO THE CONSUMPTION OR PRODUCTION OF THE COUNTRY."
Till now, we have been dealing in facts, and figures, and in careful
generalizations after the inductive manner: let us, at the very last,
indulge in a freak of fancy. Suppose for a moment, that all taxes of
every name could be abolished instantaneously, and the Governments,
like the Israelites, live on manna for forty years. What harm would
ensue? What industry would decline? Who would be impoverished? What
stimulus to work and save and grow rich would be weakened thereby?
Would not wages, and profits, and rents, all be lifted thereby, with
no damage to anybody? A child can see that Taxes from their very
nature are a burden, are a subtraction from income, are a _minus_ and
not a _plus_. Who, then, except from sinister motives, can imagine and
represent, that Taxes are a good in themselves, a positive blessing, a
spur to the progress of Society?
Taxes of some sort there must be for the maintenance of Governments,
which are established for the good of all. Why, then, should not the
Taxes be just as few, just as simple, just as comprehensible, just as
universal and equitable, as is consonant with the single end of their
existence at all?
INDEX.
A.
Abraham, 9, 384.
Abstinence, 93, 191, 338, 445.
Abyssinia, 386.
Activities of men, 1.
Actors, 4.
Act of Parliament, 127.
Act of 1624, 135.
Adams's inauguration suit, 510.
Administration, 358.
Advalorem rates of tariff tax, 489, 558.
Advantages of credit, 271.
Advantages of discount, 302.
African _macoute_, 388.
"African, the," 158.
Agent of the mill, 4.
Age of iron, 95.
Ages of stone, 95.
Agreeableness of rendering, 218.
Agriculture, 149, 538.
Allison of Iowa, 582.
Alloy, 416.
America, 3.
American capital, 166.
Ames, Fisher, 538.
Amsterdam, 165, 311, 421.
Analysis, 15.
Ancient Romans, 2.
Annual earnings, 543.
Apprenticeship, 186, 203.
Arbitration, 266.
Aristophanes, 420.
Aristotle, 47, 98, 158, 248, 381, 402.
Aristotle's Logic, 63.
Arkwright, Richard, 108.
Arlington Mills, 516.
Artisans of every name, 2.
Ascertainment, 15, 246.
Asia, 19.
Asia Minor, 333.
Asia, pro-consular, 579.
Association, 99.
Assyria and Babylonia, 330.
Astor, J. J., 180.
Astronomy, 63.
Auction, 57.
Augustus Cæsar, 392, 580.
Australia, 252, 399.
Axe, 90.
Axioms, 69.
B.
Babylonian tablets, 332.
Bacon, Lord, 63, 64.
Bailee, 278.
"_Balance of trade_," 312, 406, 452.
Bales of cotton, 345.
Ball, John, 228.
Balloon of promise, 343.
Bancroft, historian, 512, 573.
Bangor, 454.
Bank bills, 286.
Bank defined, 291.
Bank deposits, 291.
Bank discount, 299.
Bank messengers, 5.
Banker defined, 6.
"Bankers' bills," 315.
Bank of Amsterdam, 280.
Bank of England, 82, 287, 292, 350, 396, 448.
Bank of Massachusetts, 288.
Bank of New York, 288.
"Bank of North America," 288.
Bank of Scotland, 325.
Banks of Newfoundland, 180.
Barter, 364.
Bascom, John, 71.
Bastiat, 47.
Beauty of gold and silver coins, 413.
Beck, Senator, 491.
Benevolence and impertinence in trade, 239.
Bentham, Jeremy, 252, 448.
Benton, Thomas H., 494.
Berkshire Co., Mass., 260, 533.
Berlin, 3.
Berlin Geographical Society, 27.
Bernhardt, 211.
Bessemer Steel Co., 487, 491.
Best money, 395.
Best tenure of lands, 155.
Betterments on land, 173.
Bill-discounters, 300.
Bill of exchange, 278, 300, 303.
Bill of lading, 277.
"Bills of credit," 435.
Bimetallism, 415.
Bismarck, 210.
"Black Death," 227.
Blacksmith's capacity, 118.
Blades of the shears, 249.
Blaine, Secretary, 507.
"Blanket" mortgage, 284.
Blunders in economics, 75.
"Body," 78.
Bombay spinner, 201.
Bonnieres quarry, 164.
"Book of Trades," 114.
Borrow, 277.
Boston Commercial Bulletin, 563.
Boston Custom House, 564.
Botany, 63.
Bottom-principle in taxes, 567.
Bounty of God, 43.
Bradford, Governor, 391.
Bradley, Mr. Justice, 359.
Breadth of contracts, 241.
Bright, John, 199.
British colonies, 313.
British Isles, 84.
British Provinces, 527.
British Revenue Tariff, 485.
British statesman, 153.
Brokers' board, 302.
Broker's office, 6.
Bronson, 434, 436.
Brotherhoods, 226.
Buchanan, James, 447.
Bullets as money, 392.
Bullion theory, 403, 451, 453.
Bureau of Statistics, 264.
Burman Empire, 385.
Buying, 14.
Buying and selling, 4, 15, 236.
C.
Cakes of tea, 386.
Calhoun, Senator, 497, 499.
Calicoes, 105.
Canada, 179.
Capital, 92, 96, 246.
Capital defined, 93.
Capital wears out, 171.
Capitalists as a class, 233.
Capitalists of Boston, 4.
Captains of industry, 196, 244.
Carey, H. C., 103.
Carpenter's square, 38.
Carthage, 21, 84.
Carthaginians, 387.
Cartwright, Edmund, 111.
Cases and classes, 68.
"Cash accounts," 333.
Cash credits, 324, 327.
Cattle, 80.
Cattle as money, 383.
Causes of labor troubles, 238.
Cavour, 210.
Cecil, Robert, 126.
Cedars, 23, 40.
Census, 75.
Central America, 27.
Chadwick, Sir Edwin, 197, 200.
Chaldean tablets, 331.
Chalmers, Thomas, 137, 215.
Chase, Chief Justice, 356, 357.
Chatham, 210.
Chattels, 93.
Checks on market rate, 56.
Chemistry, 63.
Cheque-Bank, 321, 329.
Cheques, 303, 317.
Chevalier, 399.
Chicago, 278, 477, 501.
Chicago, fire in, 500.
China, 19, 387.
Chinese-wall policy, 474.
Christianity, 22, 30.
Christians, 10.
Church relations, 241.
Cicero, 97, 189, 248, 333, 403.
Circular credits, 327.
"Circular notes," 328.
Circulating capital defined, 99.
Civil Law of Rome, 206.
Civil war, 353.
Civil wars, 260.
Civilization, 10, 89, 252, 366.
Claims of conscience, 243.
Classes of facts, 66.
Classes of salable things, 7.
Classes of valuable things, 5, 62.
"Clearing house," 318, 321.
Cleon, 421.
Clergyman, 4.
Clerks at the clearing, 320.
Clifford, Mr. Justice, 357.
Clog of economy, 33.
"Cloth-workers' guild," 258.
Coal, 497, 527.
Cobden, Richard, 202.
Codification, 206.
Coffee and tea, 488.
Cog-wheel railway, 1.
Cohoes, 3.
COIN, 429.
Coined money of two kinds, 426.
Coke, Lord, 89.
Colbert, 404.
Colonies of New England, 249.
Columbus, 26.
Commerce, 17, 402.
Commercial credits, 49, 271.
Commercial crises, 347.
Commercial treaty of 1860, 30.
_Commodatum_, 276, 340.
Commodities, 2, 8, 20.
Commodities defined, 80.
Common law, 9, 88, 130, 205.
"Company," 4.
COMPANY OF THE INDIES, 438.
"Compete," 464.
Competition, 44, 121, 175.
"Compromise Silver Bill," 475.
Conditions of production, 99.
Conditions of a science, 67.
Conditions of trade, 15.
Congress, 256, 288, 450.
Connecticut, 100, 435.
Conrad, John, 183.
"Consolidated annuities," 274.
Consols, 285.
Constancy of employment, 219.
Constitution of the United States, 133, 178, 256, 358, 444, 474,
494, 572, 578.
Constitutional law, 429.
Continental Congress, 441.
Cooley, Judge, 113.
Co-operation, 268.
Cooper Union, 222.
Copper skewers, 385.
Copyrights, 132.
Core of money, 378.
Corn laws, 58, 177, 217.
Cost by railway mile run, 233.
Cost of capital, 161, 165, 231.
Cost of labor, 161, 231.
Costs of carriage, 466.
Costs of production, 159, 165, 397, 462.
Cotton, 105.
"Cotton City," 498.
Cotton-gin, 100.
Cottons and silks, 457.
Coupons, 337.
Court calendars, 254.
Craft-box, 226.
Craftsmen, 259.
Credit, 372.
Credit-claims, 6.
Credit defined, 275.
Credits, 8, 20, 58.
Credits are capital, 338.
Credits as taxable, 555.
Crompton, Samuel, 110.
Crossed cheques, 321.
Current rate per centum, 165.
Curtis, George T., 573.
Custom, 224.
Customs-taxes, 238, 474.
D.
Damascus, 8.
Davis, Mr. Justice, 357.
Dawes, Senator, 584.
Dawn of history, 8.
Dealer in services, 6.
Debits at the bank, 6.
Debt, its etymology, 275.
Debts of the bank, 6.
Decatur, Commodore, 482.
Decennial Census, 519.
Deduction, 62, 69.
Deductive sciences, 63.
De Foe, 100.
Demand acts upon value, 54.
Demand and supply, 369.
Demand defined, 52, 190.
Denarius of Rome, 238, 385.
Denomination-dollar, 388, 390.
Denominations of money, 372, 388.
"Depositaries," 295.
Deposit-banking, 293, 295, 297.
Deposits, 296.
Descartes, 68.
Desires, 18, 64, 75, 138.
Detroit, 491.
Dey of Algiers, 482.
Diffusion of taxes, 571.
Diminishing profits, 228.
Direct taxation, 553.
Disadvantages of credit, 271, 343.
Discount, 273.
Discount defined, 301.
Diversity of advantage, 25, 102, 117, 131, 136, 262, 455, 458.
Divine purpose, 26.
Division of labor, 252, 257, 374.
Dock laborers' strike, 313.
Doctors' fees, 204.
Doctrine of chances, 221.
Doctrine of rent, 146.
Dollar-bill, 427.
"Dollars," 359.
Domestic trade, 481.
Dorsetshire laborer, 223.
Drachm, 385.
Drawee, 329.
Drawer and bearer, 330.
Duke of Orleans, 437.
Durability of machinery, 168.
Dutch capital, 166.
Dutch East India Co., 280.
Duty, 65.
E.
Easiness of learning, 219.
East India Co., 114, 132.
Economics, 31, 40, 64.
Efficiency, 164.
Efforts, 20, 59.
Efforts and renderings, 32.
Egypt, 9, 11, 24.
Electricity and lightning, 70.
Elliott, Ebenezer, 202.
Ely, Professor, 251.
"Empire State," 286.
English recoinage, 422.
English shilling, 317.
Enlarging wages, 228.
Ephron, 9, 384.
Equation of international demand, 468.
Erie Canal, 286.
Estimates, 22, 34, 39, 43, 60.
Ethics, 64, 75.
Etymology, 37.
Etymology of "credit," 275.
Euphrates country, 392.
Euripides, 237.
Europe, 9.
Evarts, William M., 73.
Exact sciences, 63, 65.
"Exchange against," 314.
"Exchange in favor," 315.
Exchequer, 549, 568.
Excise tax, 560.
Exemption from taxes, 570.
Experience and experiments, 65.
Exports, 462.
Exposure, 15.
Ezekiel the prophet, 11, 83.
F.
Fallacies of protectionism, 503.
Fallacy A, 504.
Fallacy B, 508.
Fallacy C, 516.
Fallacy D, 520.
Fallacy E, 524.
Fallacy F, 529.
Fallen market rate, 55.
Fall of valuables, 49, 77.
Falsities of protectionism, 535.
"Farmer," 156.
"Farmers' Alliances," 519.
Farmers of United States, 577.
Fawcett, Professor, 223.
Federalists, the, 537.
Fees of preachers, 207.
Feigned cases, 65, 73.
Feudalism, 248.
Field, David Dudley, 206.
Field, Mr. Justice, 357, 360.
Field of investigation, 1.
Field of the science, 540.
Fire Insurance Co., 298.
First difficulty in money, 361.
"Five articles," 485.
"Five-twenties," 285, 355.
Fixed capital defined, 99.
Fluency of gold and silver, 401, 407.
Foreign bills of exchange, 306, 336.
Foreign trade, 454, 462.
Forms of credit, 271.
France and England, 30.
France and England in trade, 456.
Franklin, Benjamin, 436, 538.
Franklin's experiment, 69.
Fraud, 16.
Freak of fancy, 584.
"_Free breakfast table_," 488.
Free list, 583.
Freedom, 99, 112.
French "francs," 316.
French government, 56.
French lands, 156.
Fruit dealer, 366.
Funds, British, 284.
Future time in credit, 273.
G.
Gambling, 347.
Gangs of slaves, 100.
Garibaldi, 211.
General rise of prices, 348.
Generalizations, 7, 67.
Genesis, Book of, 143.
_Genus_, 7.
George, Henry, 142, 147, 151, 174.
Georgia, 441.
German Empire, 133.
German "Mark," 317, 393, 413.
Germans in Italy, 292.
Gibbon, historian, 130.
Gift, 16.
Gifts of God, 85.
Giving, 15.
Gladstone, W. E., 151, 153, 172, 568.
Glasgow, 137.
Gloversville, 103.
Glut of products, 140.
Gold and silver divisible, 412.
Gold and silver impressible, 412.
Gold coins, 409.
Gold eagle, 35.
Gold eagle of United States, 389.
Gold in greenbacks, 356.
Goodhue of Massachusetts, 496.
Gould, Jay, 204.
Government a committee, 252, 481.
Governments, 29, 267, 409.
Gradual occupation of the earth, 154.
Graduated income tax, 549, 550.
Grains, 57, 87.
Grand Device, 583.
Grand Trunk Railway, 163.
Grant, General, 358, 359, 408, 500.
Gratuitous elements, 144.
Gravitation, 363.
Great Britain, 313.
Greek cities, 384.
Greek language, 298.
Greeks, 73.
Greeley, Horace, 129.
Greenback dollar, 476.
Greenbacks, 51, 280, 290, 409, 425, 432.
Green Mountains, 519.
Green's History, 9, 580.
Gresham's Law, 421.
Gresham, Sir Thomas, 421.
Grier, Mr. Justice, 357.
Ground of taxes, 542.
Ground of trade, 25.
Grounds of production, 116.
Guild of Armorers, 226.
"Guildhall," 226.
Guilds of the Middle Ages, 258.
H.
Hamilton, Alexander, 288, 393, 415, 511, 536, 573.
"Handsome is that handsome does," 250.
Hargreaves, John, 106.
Harrison, President, 582.
Harrison's inaugural suit, 511.
Hartley of Pennsylvania, 495.
Health, 113.
Hebron, 9, 81, 83.
Henry II., 580.
Hepburn _vs._ Griswold, 356.
Herodotus, 386.
Heyd, Dr. W., 27.
Hildreth, historian, 512.
Hills of Judah, 25.
Hindoo rice, 393.
Hired men lack motives, 255, 208.
History of taxes, 579.
Hoar, Judge E, R., 358.
Holland, 280.
"Home Market Club," 516.
Home Rule, 173.
Homer, 81, 383.
Homer, Sidney, 351.
Hoosac River, 27.
Hoosac Tunnel, 286.
Horse-leech cry, 514.
House-tax, 555, 570.
Hudson's Bay Company, 114, 180.
Hull, John, 434.
Human efforts, 89.
Human nature, 363.
Hume, David, 121, 124, 326, 373.
"Hymn to the Nativity," 149.
I.
Ideal dollar, 426.
Idle capital, 191.
Iliad, 81, 383.
Illinois Central Railway, 232.
Impeachments, 253.
Imports, 474.
Improvements in machinery, 465.
Income bonds, 284.
Income tax, 547, 549, 578.
Indented servants, 248.
India, 26.
Indirect taxation, 553, 570.
Individuals _vs._ Government, 253.
Indorsements, 304.
Induction, 62, 397.
"Infant industries," 514.
Infinite Mind at work, 363.
"In God we Trust," 413.
Inland bills of exchange, 306, 336.
Inquiry, 78.
Internal taxes, 560.
International demand, 460.
"International Copyright," 212.
International exchange, 330.
Introspection, 65, 67, 71, 77.
Invention, 99, 104.
Invention of money, 366.
Ireland, 386.
Irish banks, 288.
Irish Land Bill, 151.
Irish leases, 173.
Iron Mountain, 526.
Iron in Tennessee Valley, 565.
Irving, Washington, 180.
Israelites, 584.
Issuer and bearer, 355, 427.
Italy, 150.
J.
Jack-knife, 94.
Jacob, 9.
Jacobites, 292, 422, 431.
Jamaica rum, 496.
Jamestown, Va., 162.
Jay, John, 537.
"Jealousy of Trade," 121.
Jefferson, Thomas, 415, 424, 442.
Jerusalem, 12, 24.
Jevons, Professor, 319, 381, 399.
Jews, 9, 10, 21, 24, 240, 333, 443.
Job, the Book of, 83, 397.
Jonson, Ben, 88.
Joppa, 22, 23.
Judges, 4.
K.
Kay, father and son, 106.
Kentucky, 491.
Key to unlock difficulties, 364.
Kinds of tariffs, two, 483.
Kinds of utility, 44.
King Hiram, 11, 16, 364.
King Philip's victories, 392.
King Solomon, 11, 16, 364.
_Kinkiness_, 105.
"Knit-goods Bill," 488.
Knox, Comptroller, 433.
Knox _vs._ Lee, 359.
Kountze Brothers, 328.
L.
Labor, 182.
"Labor and Capital," 183.
Labor defined, 90, 161, 184.
Laborers, 4, 184, 186.
Laborers as a class, 233.
Labor-troubles, 237.
_Laissez faire_, 252.
Land Bill, 1881, 172.
Land parcels, 146, 170.
Lands, 141.
Lapoint, Alfred, 130.
Latin Union, 414.
Law, John, 341, 436, 439.
Law of diminishing returns, 153, 172.
Law of supply and demand, 52, 53.
Laws of Moses, 443.
Lawyers, 4.
Layard, 331, 384.
Legal rate of interest, 234.
Legal ratio of gold and silver, 393.
Legal restrictions, 225.
Legal tender, 355, 356, 359.
Legislators, 4, 270, 377, 451.
Life Insurance Co., 298.
Lightning-rod, 70.
Limestone, 527.
Limits of production, 136.
Limits of value, 58.
Lincoln, Abraham, 210.
Lind, Jennie, 187.
Liverpool, 455, 528.
Loan, 276.
Loaves of bread, 379.
Locke and Newton, 423.
Lockouts, 247, 266, 521.
Locomotives, 233.
Logic, 63.
Logical fallacies, 534.
London bills, 310.
London bills of exchange, 469.
London Bridge, 2, 3, 313.
Lord Mayor of London, 265.
Losses from depreciated money, 478.
Louisiana, 438.
Lowell, 3.
Lowell and Jackson, 497.
Lowell mill, 7.
Lowell on the Merrimack, 498.
Lowering rates of interest, 234.
Lowndes, Congressman, 498.
Low taxes on few things, 568.
Lucretius, 95.
M.
Macaulay, 123, 422.
McCulloch, Hugh, 359.
Macedonia, 579.
Machinery, 197, 200.
McKinley, 508, 516, 563, 581.
Macleod, Henry Dunning, 47, 278, 292, 382, 383.
Machpelah, 82, 365.
Madison, James, 494, 537.
Magellan, 26.
Magna Charta, 444, 581.
Major Premise, 63.
Malthus, T. R., 215.
Manager at the Clearing, 5, 320.
Mania, 16.
Market defined, 137.
Market for products, 54.
Market value, 54.
MARKETS, 195.
Marshall, Mr. Justice, 358, 573.
Mason's trowel, 38, 98.
Massachusetts, 286.
Material commodities, 49.
Maximum value, 61.
Mechanics, 42.
Mediterranean, 23.
Mercantile sagacity, 140.
Mercantile system, 115, 312.
Mercantile Theory, 403, 452.
Mercantilism, 576.
Merchant defined, 6.
Merchants as a class, 9.
Messengers at the Clearing, 320.
Metaphysics, 64, 75, 242.
Methods and motives in foreign trade, 481.
Methods of mining, 398.
Metric system, 419.
Metropolitan Museum, 332.
Mexican exports, 479.
Mexican imports, 479.
Mexicans, 105.
Mill, John Stuart, 32, 63.
Miller, Mr. Justice, 47, 357.
Mills, Roger Q., 581.
Milton, 149.
"Mind-cure," 263.
Mint of Amsterdam, 422.
Mississippi Valley, 519.
Mobility of laborers, 221.
Molasses, 496.
Molasses tax, 538.
Mommsen, 238.
Monetary Conference at Paris, 73, 74.
Monetary "par," 471.
Money, 77, 361, 367.
Money a measure, 380, 415.
Money a "medium," 370.
Money a tool, 377.
Money, current, 51.
Money defined, 380.
Money divisible, 374.
Money is capital, 374.
Monopoly, 88, 122.
Montesquieu, 388.
Moody's "power-loom," 497.
Moors from Africa, 481.
Moral sciences, 63.
Morals, 113, 248.
More, Sir Thomas, 536.
Morrill, Senator, 518.
"Morrill Tariff," 521, 533.
Morris, Gouverneur, 539.
Morris, Robert, 415.
Moses, 11.
Motives of Protectionists, 493.
Motives to trade, 77.
Mountain view, 1.
Mountains of Israel, 25.
Mount Lebanon, 23, 364.
Mozart, 211.
Munn, Dr., 204.
Murillo, 56.
Muscular effort, 189.
Musicians, 4.
_Mutuum_, 276.
Myers, P. V. N., 332.
N.
Names on notes, 301.
Napoleon, the First, 134, 570.
Narbo in Gaul, 579.
National Bank, 289.
National Banks of United States, 428.
National Debt, 351.
National Labor Commissioner, 528.
Nationalism, 251, 256.
Nature, 102.
Nature of Credit, 271.
Natural agents, 85, 86.
"Natural monopolies," 136.
Nebuchadnezzar, 332.
Nelson, Mr. Justice, 357.
Nevada mines, 411.
New England, 145.
New Hampshire, 36, 441.
New Jersey, 502.
New Orleans, 438, 454.
New Testament, 12.
New York, 165, 477.
New York Central Railway Co., 491.
New York Clearing-House, 5, 7, 319.
"New York Public," 350.
Nickel pieces, 394.
Non-capital, 97.
North Carolina, 92.
Nottinghamshire, 163.
Novgorod, in Russia, 386.
Nullification, 577.
O.
Objective and subjective, 31.
Objective realities, 76.
Obligation in credit, 275.
Ocean freights, 474.
O'Connell, Daniel, 177.
Ohio sheep, 530.
"Oil Trust," 179.
Oklahoma, 221
Old Testament, 11.
Open ports of Great Britain, 474.
Operatives, 4.
Opinions on Protectionism, 535.
Orders to pay, 328.
O'Reilly's poem, 208.
Oresme, Nicole, 98.
Origin of capital, 95.
Oscillations of demand, 408.
"_Ought_," 65.
Ounce of silver, 36.
Our Lord, 12.
Outlying cases, 142.
Overseers of the mill, 4.
Owners, 38.
Oxford University, 338.
Oxus River, 27.
P.
Pacific States, 418.
Paganini, 187.
Palermo, 455.
Palfrey, historian, 512.
Paper-makers, 197.
Paper-makers' convention, 584.
Paper money, 427, 429.
Par of Exchange, 307, 316.
Par of foreign exchange, 468.
Paradise Lost, 88.
Parcels in the Clearing, 6.
Paris, 3, 57.
Paris bills of exchange, 470.
Parliament, 284.
Past time in commodities, 274.
Patent rights, 132.
Paul, Lewis, 109.
Pauper labor of Europe, 528.
Payer and payee, 329.
Peace, 29.
Peas and potatoes, 272.
Peasant proprietor, 157.
Peculiarities of Credit, 271.
_Pecunia_, 81, 384.
Pence and pound, 389.
Pennsylvania, 436, 490.
Personal services, 181.
Personal slavery, 80.
_Persons_ in credit, 275.
Petals of flowers, 70.
Pheidon, King of Argos, 384.
Philip le Bel, 404.
Philpott, editor, 521.
Phoenicians, 21.
Physical sciences, 32, 63, 64, 71.
Physicians, 4.
"Physiocrats," 141.
Physiology, 216.
Pierre and Company of Paris, 307.
Piers Ploughman, 228.
Pig-iron production, 560.
Pilgrims, 391.
Pillars of Hercules, 84.
Pine-tree shillings, 392.
Plato, 248.
Pliny, 384.
"Political Economy," 15, 174.
Polo, the traveller, 387.
"Pool," the, 2.
Poor Richard's Almanack, 158, 243.
Poor's Railroad Manual, 229.
Popular remedies for low wages, 251.
Portability of money, 411.
Porter, Dr. Samuel, 28.
Porters, 2.
Portfolio of governments, 254.
_Post hoc ergo propter hoc_, 534.
Post Offices, 256.
Potosi, silver of, 398.
Pottery wares, 502.
Pounds sterling, 310.
"Power," 91.
"Power-loom," 111.
Preamble of the Constitution, 256.
Present time in services, 274.
President Jackson, 289.
Press and Pulpit, 244.
Price, 50.
Price, Bonamy, 338, 382.
"Prices current," 50.
Prices of services, 375.
Prices under taxation, 549.
Principle of taxes, 546.
Privy Council, 350.
Probabilities, 347.
Probability of success, 220.
_Procullus_, 451.
Production defined, 84.
Products in market, 54.
Profitable exchanges, 473.
Profits, 94.
Profits the leavings of wages, 235.
Progress of civilization, 10.
Promise to pay, 279.
Promissory notes, 300.
Property, 101, 275, 545.
"Property is theft," 148.
Proportion of taxes, 544.
"Protectionism," 309, 453, 493.
Protectionism is prohibition, 486.
Proverbs, 12.
Providential elements in Economics, 362.
Prudhon, 148.
Prussians, 549.
Public opinion, 451.
"Pulpit or Platform," 22.
Q.
Quality of gold uniform, 411.
Quantity of metals, 399.
Queen Elizabeth, 123.
Questions of taxes, 541.
"Quick sales and small profits," 344.
Quittance, 354.
R.
Randolph, John, 498.
Rapidity of circulation, 372, 409.
Rate of interest in Holland, 234.
Rate of taxes, 556.
Rates of discount, 316.
Ratio of gold and silver, 74.
Raw materials, 526.
Redemption of greenbacks, 291.
Religion higher than morals, 263.
Remedies for labor troubles, 238.
Renderings, 26, 59, 76, 78.
Rent, 160, 169.
Rent defined, 170.
Republic of Mexico, 478.
Republic of Venice, 291.
Requisites of production, 84.
Return services, 138.
Revenue, 113.
Revenue rights, 134.
Ricardo, David, 146, 153, 169, 176.
Right and wrong, 65.
Rise in market rate, 55, 77.
Rise of prices, 408.
Rise of valuables, 49.
"River and Harbor Bill," 488.
Roach, John, 516.
Robinson Crusoe, 100.
"Rogues' Island," 441.
Roman coins, 385.
Roman Law, 277.
Roman mercantile transactions, 238.
Roman taxes, 579.
Romans, 313, 402, 579.
Royal Bank of France, 438.
Royal library at Nineveh, 384.
Ruggles, S. B., 74, 418.
Rupee, 386.
Russia, 150.
S.
_Sabinus and Cassius_, 451.
Salary-class, 184.
Salt, 178.
San Francisco, 455.
Sandal-wood, 23.
Sardanapalus, 331.
Satisfactions, 28, 75, 115.
Savannah, 527.
Savings banks, 270, 334.
Saxon ancestors, 93.
Say, J. B., 137.
Scandinavian "crown," 317, 393.
"Scarcity" of money, 440.
Schouler, James, 511.
Science as prophetic, 450.
Science defined, 62.
Science of buying and selling, 61.
Science of value, 42.
Scotch banking, 325.
Scotch banks, 288.
Scotland, 437.
Scott, W. L., 265.
Screw of Discount, 316.
Scriptures, 9, 14.
Scudder, M. L., 478.
Secession, 577.
Second difficulty in money, 362.
Secretary of the Treasury, 296.
Sempronian law, 580.
Services, 7.
Servius Tullius, 384.
"Seven-thirties," 285.
Shakspeare, 88, 98, 211.
Shears, 91.
Shekels, 9.
Sherman, Senator, 48, 490, 582.
Shoddy, 130.
"Shoemakers' Guild," 258.
Shut-downs, 521.
Shuttle, 91.
Shylock, 98.
Sicily, 580.
Silks and cottons, 457.
Silo, 155.
Silver certificates, 279.
"Silver Colony," 392, 442.
Silver dollar, 418.
Six kinds of exchanges, 8.
Skilled laborers, 186.
Smith, Adam, 114, 385, 398, 448, 536.
Smith, Captain John, 162.
Smith, Jonathan, 205.
Smithson, James, 214.
Social relations, 241.
Society, 5, 18.
Sociology, 242.
Solomon, 18.
Somers and Montague, 423.
Sons of Heth, 9.
Source of taxes, 543.
Sources of income, three, 547.
South Carolina, 435, 497.
Spain, taxes in, 569.
Spanish-Mexican dollar, 424.
Spanish milled dollar, 415.
Spaulding, E. G., 354.
Speaker of Commons, 126.
Specialties, 103.
Species, 8.
Specific rates of tariff-tax, 489.
Specific taxes, 558.
Speculation, 476.
Speculation proper, 346.
Spencer, Herbert, 342.
Spinning, 106.
Spinning-Jenny, 108.
"Springfield Republican," 265.
St. Louis, 114.
St. Petersburg, 455.
St. Timothy, 242.
Standard of comparison, 377.
Stanford, Senator, 439.
"Star Route Frauds," 256.
State banks, 288.
States and nation, 68.
Statistics, 230.
Statute law, 9.
Stealing, 15.
Steel beams, 564.
Steel rails, 487, 490.
Sterling exchange, 472.
Stephenson, Robert, 129.
Stock, 284.
Stock Exchange, 347.
Stockholm, 455.
Storrs, Dan, 303.
Story, Mr. Justice, 573.
"Straddles," 347.
Straits of Gibraltar, 481.
Strikes, 247, 261, 521.
Strong, Mr. Justice, 359.
"Subdue," 144.
Sub-forms of capital, 99.
Subject of money clear, 361.
Subject of Political Economy, 1.
Subjective elements, 39.
Subsidiary coins, 394, 418, 425, 433.
Sub-treasury of United States, 319.
Sugar and molasses, as taxed, 567.
"Suppliants" of Euripides, 237.
Supply and demand, 36, 445.
Supply defined, 53.
Supply of laborers, 219.
Supreme Court, 575.
Supreme Court of United States, 360.
Suspension of specie payment, 431.
Swank, James M., 565.
Swayne, Mr. Justice, 357.
Syllogism, 69.
T.
Taconics, 27.
Tailor's capacity, 119.
Talents, Parable of, 13.
Tariff, 128, 481.
Tariff defined, 483.
Tariff delusion, 577.
Tariff for revenue, 483.
Tariff Monopolies, 134.
"Tariff of Abominations," 576.
Tariff of United States, 487.
Taussig, Professor, 128, 488.
Taxation, 363, 540.
Tea and coffee, 488, 492.
Teachers, 4.
Temple at Jerusalem, 364.
Temple, Lord Richard, 199, 202, 544.
"Thaler," 393.
Theft, 16.
Thing-dollar, 427.
Third nation in trade, 459.
Thompson, Professor, 516.
Thoughts, 64.
Ticket, a general, 371.
Time of advance, 166.
Tobacco of Virginia, 369.
Tobacco taxes, 571.
Tools, 95.
Trade, 10, 72.
Trades-unions, 226, 258.
Treasurer of the mill, 4.
Trebizond, 27.
Tree-wool, 105.
Troughton's inch, 390.
Trust, 10.
Trustee, 278.
Tubal Cain, 95.
Tunis and Tripoli, 482.
Tyre, 11, 83.
Tyrians, 19, 22.
U.
Ulpian, 277.
"Ulster right," 224.
Ultimate elements, 30.
Union Bank of London, 328.
Unique cases, 46.
United Kingdom, 171, 203, 393, 406.
United States, 139, 165, 247, 288, 380, 405, 415, 450.
United States Bank, 288, 289, 293.
United States Money, 310.
United States Treasury, 279.
Universal income tax, 556.
University, Johns Hopkins, 251.
Unprofitable exchanges, 473.
Unseen elements, 31.
Unvalued lands, 143.
"Ur of the Chaldees," 384.
Usury laws, 442, 448.
Utility, 144, 161.
Utility and Value, 43, 147.
V.
Vale of Sharon, 26.
Valuable lands, 143.
Valuables, 7, 49, 368, 378.
Value, 32, 65.
Value acts upon demand, 54.
Value defined, 46.
Value of cottons and silks, 459.
Vasco da Gama, 27.
Vermont, 577.
Vermont wools, 530.
Vice-President Clinton, 289.
Virginia in 1755, 436.
Vital principles of a protective tariff, three, 486.
Vital principles of a revenue tariff, three, 483.
Voluntary associations, 226.
W.
"Wages," 161, 184.
Wages-portion, 192, 257.
"Wages-question," 163.
Wages, the leavings of profits, 235.
Walker, Francis A., 163, 184.
Walker, J. H., 340.
Walker's "Money," 382.
"Walking-delegate," 265.
Waltham, 497.
Wampum, 386.
War debt, 353.
Washington, 210.
Washington's inauguration suit, 510.
Water from the spring, 59.
Waterfall, 87.
"Water-twist," 109.
Ways and means, 355, 487.
"Wealth," 32.
"Wealth of Nations," 398, 536.
Webster, Daniel, 88, 187, 573.
Wells, David A., 571.
West of Europe, 19.
Whigs, 292.
Whitman, William, 516.
Whittier, 258, 500.
Will, 64.
William and Mary, reign of, 292, 392, 423.
Wiltshire laborer, 223.
Wolfe, General, 207.
Wool, 105.
Wool and woollen industry, 563, 581.
Wool and woollens tariff, 529, 533.
Wool manufacturers, 516.
Worn-out farms of New England, 155.
Wright, C. D., 267, 528.
Y.
Yard-stick, 378.
York shilling, 424.
Typography by J. S. Cushing & Co., Boston.
Presswork by Berwick & Smith, Boston.
* * * * *
Two Earlier Works
By PROF. PERRY.
INTRODUCTION TO POLITICAL ECONOMY.
Revised Edition. 12mo, $1.50.
POLITICAL ECONOMY.
Eighteenth Edition. Rewritten and Enlarged. Crown 8vo, $2.50.
Prof. Perry's most elementary text-book, Introduction to Political
Economy, presents the subjects of Value, Production, Commerce, Money,
Credit, and Taxation, in a way plain and easily grasped by young
minds, but at the same time scientifically exact. In his preface the
author says: "I have endeavored so to lay the foundations of Political
Economy in their whole circuit, that they will never need to be
disturbed afterwards by persons resorting to it for their early
instruction, however long and however far these persons may pursue
their studies in this science."
"This work is not meant in any way to take the place of its
author's larger treatise, but rather to occupy a field which,
in the nature of the case, that work cannot occupy. It is not
an abridgment of that work but a separate treatise, intended
primarily for the use of students and readers whose time for
study is small, but who wish to learn the broad principles of
the science thoroughly and well, especially with reference to
the scientific principles which are involved in the practical
discussions of our time.... We need scarcely add, with
respect to a writer so well known as he, that his thinking is
sound as well as acute, or that his doctrines are those which
the greatest masters of political science have approved."
--_The N. Y. Evening Post._
_Prof. Perry's Advanced Work._
POLITICAL ECONOMY.
Eighteenth Edition.
_Rewritten and Enlarged, 1 vol., Crown 8vo. $2.50._
This book has passed through several revisions, to the most thorough
of which it was subjected in 1883. It has grown in size, in symmetry
and in maturity of thought and expression, so that it is a complete
exposition of the science, both historically and topically. The
distinctive feature of the work is its discarding the term _Wealth_
and making _Value_ the subject of the science. Original light is
thrown on the vexed questions of Land, Money, and Credit, and the
whole trend of the book is on the side of sound currency and
unrestricted trade.
Professor Perry's style is admirably clear and racy; his illustrations
are forcible and well chosen, and he has made a subject interesting
and open to the comprehension of any diligent student, which has often
been left by writers vague and befogged and bewildering. This work has
stood excellently the test of the class room, and has been adopted by
many of the chief educational institutions in this country. Among them
are Yale College, Bowdoin College, Dartmouth, Trinity, Wesleyan,
University of Wooster, Dennison University, Rutgers College, New York
University, Union College, Seton Hall College, Hampden-Sidney, and
many other colleges and normal and high schools.
* * * * *
CRITICAL NOTICES.
"This edition has the marks of mature power and complete
grasp of the subject, and that finished style in which
thought and language have become perfectly adjusted to each
other. The statements and illustrations convey the thought
clearly and aptly."--_Boston Watchman._
"You have made an exceedingly valuable contribution to the
science of political economy. I am not a little surprised
that a college professor should have written a book so
intelligible to the common mind, and so eminently practical
and instructive. Accept my thanks for your kindness in
sending me the book, and my grateful acknowledgments as your
fellow-citizen for the service you have rendered the country.
It is, in my judgment, the ablest and most valuable work yet
published upon the science of which it treats. I do not see
where it could be improved in matter, or style, or
arrangement."--_Hon. H. McCullough, Secretary of the U. S.
Treasury._
"Your book interests students more than any I have ever
instructed from."--_President T. D. Woolsey, Yale College._
"So far as I have been able to read it, it seems to my humble
judgment remarkably clear, as well as well-timed and
sound."--_Hon. W. E. Forster, M.P., Leeds, Eng._
"The gem of your work is 'foreign trade.' It is the best
thing I have ever seen, the most clear and satisfactory. If
my friend Cobden were alive, he would send you his
congratulations and thanks."--_Hon. Amasa Walker, M.C.,
Lecturer on Political Economy, Amherst College._
"As a manual for general reading and popular instruction,
Prof. Perry's book is far superior to any work on this
subject before issued in the United States."--_New York
Times._
"We cordially recommend this book to all, of whatever school
of political economy, who enjoy candid statement and full and
logical discussion."--_New York Nation._
"There is more common sense in this book than in any of the
more elaborate works on the same subject that have preceded
it. It is the most interesting and valuable one that has been
given to the American public on this important
subject."--_New York Independent._
"In all the portions of the book which we have read the
author shows himself to be a clear, strong, bold, and
generally sound thinker."--_New Englander._
"Prof. Perry has certainly produced one of the best
elementary treatises on political economy that we have ever
met with in any language."--_New York Commercial._
"Prof. Perry is a vigorous thinker, a clear and forcible
writer."--_Princeton Review._
.*. _Full Descriptive Catalogue of distinguished works in all
departments of education sent free. Introductory and examination rates
furnished on application._
CHARLES SCRIBNER'S SONS, Publishers,
743 and 745 Broadway, New York.
* * * * *
Transcriber's note:
Obvious typographical errors were corrected. Unusual spelling (for
example: estop, Shakspeare), grammatical usage, and hyphenation
variants present in the original (including co-operate and coöperate)
have been retained.
Alphanumerical paragraph labels and their formats were inconsistent in
the original. These inconsistencies have been retained.
P. 351, Table in original did not include data for 1877.
P. 385, ~dragma~, original appeared in Greek script (script included
in html version)
Several index entry page number references were incorrect--in some
cases up to 100 pages. These have been corrected.
At the end of the advertisements, ".*." indicates an asterism.