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OUR MONEY AND THE STATE
WORKS BY THE SAME AUTHOR
THE MEANING OF MONEY $1.25 _net_
MONEY CHANGING: An Introduction
to Foreign Exchange $1.75 _net_
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E. P. DUTTON & COMPANY
NEW YORK
OUR MONEY AND
THE STATE
BY HARTLEY WITHERS
Life is like playing a violin solo in public
and learning the instrument as one goes on.
SAMUEL BUTLER, _Essays on Life, Art and Science_
[Illustration]
NEW YORK
E. P. DUTTON & COMPANY
681 FIFTH AVENUE
COPYRIGHT, 1917
By E. P. DUTTON & COMPANY
Printed in the United States of America
PREFACE TO THE AMERICAN EDITION
Problems of Public Finance are looked at from different angles by
different peoples, but are, in essence, much the same all over the
world. Moreover it is possible that if the present war ends in the
establishment of a League of Peace, based on the brotherhood of
Mankind, as foreshadowed by President Wilson in his noble message to
the Russian people, there may be a change in the outlook on questions
of taxation, and they may be henceforward looked at from a new point
of view, directed to the furtherance of that brotherhood. In any case,
since one of the benefits that the people of the United States have
always enjoyed is the power to profit by the mistakes of Europe, it is
possible that an English view of the relations between the State and
the property of its citizens may be of some interest in America.
HARTLEY WITHERS.
_July_ 1917.
PREFACE TO THE ENGLISH EDITION
This book grew out of a course of lectures on Public Finance delivered
at the London School of Economics in February and March. The subject
had already been dealt with ably and fully by writers who had made a
special study of it; but the present war, by making us spend with such
titanic recklessness, has supplied us with a huge magnifying glass,
by which cause and effect are more clearly seen than in times of
peace. The results of borrowing, inflation of currency, and inequities
in taxation are seen at work now on such a scale that if we use the
experiences of the war aright they may help us to better financial
methods when the war is over. Students who wish to pursue the subject
into its technical and scientific details can do so with the help
of _Public Finance_, by Prof. Bastable; _The Income Tax_, and other
works on taxation by Prof. Edwin R. A. Seligman; _British Budgets,
1887-1913_, by Sir Bernard Mallet; _The System of National Finance_,
by Mr. E. Hilton Young, M.P.; _The Financial System of the United
Kingdom_, by H. Higgs, C.B.; and that monument of industry and mine of
statistical and other information, the House of Commons Return (366)
of 1869, on Public Income and Expenditure, etc., drawn up in years
of patient labour by Henry W. Chisholm, sometime Chief Clerk of the
Exchequer: it is commonly called _Chisholm’s Analysis of the Public
Accounts, 1688-1869_.
HARTLEY WITHERS.
6, LINDEN GARDENS,
_June_ 1917.
CONTENTS
CHAPTER I
PAGE
THE OBJECTS OF GOVERNMENTAL SPENDING 1
Government spends to secure property of citizens,
to defend national honour, to increase country’s
material resources and promote national health--Government’s
theoretical right to take all citizens’
property modified by practical inability--Change in
view as to governmental activity--Spencer--Huxley--Adam
Smith.