ONE of the most striking phenomena of modern public finance is the growth of public expenditures. Burdens of taxation amounting in volume to many times the amount which drove our British ancestors to take arms against the Stuarts in the seventeenth century, or which impoverished France before the Revolution, are now borne almost without a murmur by the people of every civilized state ; and even where murmurs occur, the new burdens have not prevented an astonishing progress in accumulated wealth and productive resources.
Before discussing the reasons for this remarkable situation, which has excited grave apprehension in many quarters, it will be proper, without attempting a systematic presentation of comparative statistics, to give a few facts which will illustrate the change which has taken place within our own century, and even within a generation, in the volume of public expenditure and of taxes collected in civilized countries. Comparisons cannot be reduced readily to a scientific basis, because of the wide variety in methods of taxation, and the different distribution of national, provincial, and local functions in different countries. In such matters, for the general reader, the impression of the wide difference between the past and the present is as truthful as minute detail, and fastens a more striking and permanent picture in the mind. The purpose of this paper is chiefly to point out the changes of the last twenty-five or thirty years, rather than those extending over a longer period, but a few facts from the history of the leading civilized countries at earlier dates will serve to bring into bolder relief the tendencies of the present generation. The few facts here given for purposes of illustration will deal partly with the revenue side of the budget, showing the taxes collected, and partly with the side of expenditures, showing the great sums disbursed for civil and military purposes under modern conditions. It will appear, also, from the comparison of the increased revenues collected from the same sources from year to year, upon what a growing volume of national wealth the modern system of public revenue is founded.
In France, when Napoleon was organizing the greatest of his armies for the disastrous campaign against Russia, the entire budget of expenditures submitted by his minister of finance, the Comte de Mollien, was only 1,168,000,000 francs, or about $225,000,000, of which nearly two thirds was for military purposes. This comparatively modest sum, equal to less than our internal revenue collections last year, was all that it was proposed to gather by taxation not alone from the France of the Bourbons, but from the great empire beyond the Rhine and reaching to the Po, which had been established by the victories of a dozen years. The budget of France to-day, shut within her old limits and with the loss of Alsace-Lorraine, is nearly four times this amount in a time of profound peace, and no one knows what might be its amount in case of war. France affords a convenient illustration for economic discussions, because her population has not increased greatly within the century. It was 30,461,875 in 1821, 36,102,921 in 1872, and 38,343,192 in 1891. It is not, therefore, an increase in population which has enabled the French government to swell the figures of its budget. The reasons must be sought in unusual extravagance, or in causes growing out of the industrial development of the nation.
In England, in the times of the restored Stuart dynasty in 1660, the annual revenue is computed by good authorities at £1,200,000 for a population of five and a half millions, or but little more than $1 per head. In 1795, before the Continental wars had brought disorder into imperial finances, the revenue of the United Kingdom was £19,657,993 for a population of less than nine millions, or about $8 per head. Even then the debt charge swallowed up half the revenue, and dire predictions were frequent of England’s collapse under the heavv burdens she bore. The added burdens of the Napoleonic wars swelled the debt charge to a startling amount, but it gradually fell relatively to other expenditures, and up to 1870 the exactions of the tax gatherer tended to demand a smaller rather than a larger proportion of the national wealth. The expenditures of 1871 were £69,548,539, amounting to about $11 (£2 4s. 5d.) for each inhabitant of the United Kingdom. But the expenditures of 1895 rose to £93,918,421, and those of 1899 to £108,150,236, or about $13 per capita. It is significant that the entire recent increase is exclusive of the debt charge. This has been, roughly, £25,000,000 a year for fifty years, so that expenditures for other purposes advanced from about £45,000,000 in 1871 to £83,000,000 in 1899, — an increase of about 84 per cent within less than a generation.
In the United States, dealing with the federal revenue alone, the demand made upon the American people in 1842 was only $25,205,761, or $1.39 per capita. The amount had risen in 1860 only to $2.01 per capita. Then came the disturbances of the Civil War, whose effect was felt for many years upon the annual budget. The lowest per capita expenditure after the war was in 1886, under the administration of President Cleveland, when the total amount was $242,483,138, and the amount per capita was $4.22. Expenditures per capita rose to $5.71 in 1891, but fell to $4.93 in 1896 and $5.01 in 1897. Then came the disturbing influences of the Spanish War, which it is not necessary to discuss here. The expenses of the United States upon a peace basis, even before the recent increase of the army, may be said to be about $5 per head, — more than three times what they were sixty years ago, two and a half times what they were before the Civil War, and 20 per cent greater than they were even within fourteen years. If the expenditures for state and municipal purposes could be presented, they would show at least a proportional, and probably a much greater increase.
In Germany, the modest imperial budget established after the war with France called for expenditures of only $135,000,000 (569,388,500 marks) in 1878, which swelled to double the amount in 1889, and to $370,000,000 (1,551,709,400 marks) in 1899. In Russia, the ordinary expenditures rose from 1,099,372,000 francs ($215,000,000) in 1866 to 2,433,388,000 francs in 1890, and 3,622,789,000 francs ($700,000,000) in 1898. The receipts and expenditures in Russia have been greatly swelled in recent years by the extension of the state railways, whose gross transactions figure in the budget; but a writer in l’Economiste Europden of January 19, 1900, puts the collections from taxes at about two thirds of the total budget.
The question naturally arises, What is the cause of this greatly increased burden imposed upon the average citizen for the expense of government ? Is it the result of reckless extravagance by public officials, and the needless multiplication of useless offices, or does it afford substantial benefits to the community ? Such a question is not capable of an unqualified answer. There is, without doubt, extravagance and needless multiplication of offices in the great machines which constitute modern governments. It is in the very nature of government service to be less flexible, less efficient, and more costly than private service. The controlling reason is the absence of competition. Methods which would bankrupt a private establishment are the usual methods of governments, partly because of the recognized necessity for greater formality and more strict accountability, but largely, also, because the government generally has no competitor in those fields which it enters. In assuming control of the postal service, it legislates against private post offices. In assuming charge of the police, it practically prohibits rival police companies except for special and private services. In regulating the coinage of money, it prohibits private mints. In all these fields, the government service is not self-supporting, but substitutes forced levies upon the pockets of the taxpayers for the favorable balance sheet which is the vital necessity of private business.
This statement of the evils inherent in government methods does not, however, touch the question whether such methods are becoming worse under modern conditions than they were a century ago or a generation ago. The fact in most cases is that these methods are becoming better; that public servants render better service; that their compensation is being brought more closely into harmony with that in private business, and in many positions of honor and scientific skill far below that in private business; and that the pressure of public opinion is bringing public services into closer harmony with private methods. The reason for the great increase in public expenditures must be sought, therefore, in other sources than the corruption of the service or its lack of efficiency. Examination of the facts will show that it is found in new and better services performed by the state for the community. In the words of Professor Maurice Block :—
“ The citizen is becoming more and more exacting. He demands much of the state. On the other hand, he multiplies its attributes and powers ; there is a sort of emulation in this respect between different countries. It follows that functionaries are more and more numerous and salaries higher; there are more railways and highways ; more canals, and harbors, bridges, aqueducts ; more monuments, museums, schools, and laboratories; alas, more soldiers, cannons, and fortifications, and more ships of war.”
These increased services, moreover, are not, properly speaking, the result of the encroachment by the state (except perhaps in Germany) upon the field of private enterprise, but are the result of the greater social wealth which enables the individual to provide himself with a better livelihood than before by his private expenditures, and at the same time spare the means to the government for rendering him services which were not performed at all before, and could not well be performed by private enterprise.
Under modern conditions of machine production and the application of steam and electricity even to farming, the productive power of the individual has greatly increased. This increase was large during the first half of the nineteenth century, but has perhaps been greater during the present generation, since the full equipment of the civilized nations with labor-saving devices. Man has not chosen to take advantage of the whole of his increased power to work fewer hours. He has done this to some extent and in certain exacting industries, but upon the whole he has chosen to apply this added power chiefly to getting more things rather than getting only the same things by less work. Hence the wonderfully rapid accumulation of wealth in modern society. To illustrate again by the example of France, 67,347 machines with a horse power of 1,263,000,000 supplemented the productive power of Frenchmen engaged in industry in 1896, where only 26,221 machines with a horse power of 320,000 were available in 1869. It is not surprising that, among other symptoms of wealth, depositors in the savings banks increased in number from 2,131,000 in 1869 to 6,842,000 in 1898, and that their deposits rose from 711,000,000 francs to 3,388,000,000 francs ($657,000,000), without counting the postal savings banks, established in 1881, and in 1898 showing 2,892,000 depositors and 844,000,000 francs of deposits. If such growth in wealth has taken place in France, one of the most heavily taxed of all countries, it is not surprising that in Great Britain, within the short interval of eighteen years, from 1880 to 1898, the deposits in the postal savings banks were multiplied nearly fourfold (from £33,744,637 to £123,144,099), and amount to an average of nearly $75 for every family of five persons.
Facts like these are sufficient to show that the increase of public expenditures has not prevented saving by the masses at a rate never before approached in the world’s history. Nor have the wealthier classes borne the new burden of taxation at the expense of continued progress. In Prussia, the revenue subject to income tax increased more than 20 per cent from 1893 to 1898. The amount in 1893 was 5,724,323,767 marks, and in 1898 6,774,937,505 marks ($1,650,000,000), — an increase of 1,050,613,738 marks ($200,000,000) within the short space of five years. In France, the ordinary receipts of the treasury rose from 45 francs per head in 1869 to 89 francs in 1898, representing within about thirty years the imposition of a charge of $18 upon every Frenchman where $9 was formerly collected. But hand in hand with this added burden has gone the increased power to bear it. While France has undoubtedly been hampered in her development by military expenditures, every index of her wealth and earnings shows astonishing progress within the present generation. The property subject to the succession tax in 1866 was 3,271,841,672 francs. The amount had risen in 1898 almost 50 per cent, or to 5,767,500,000 francs ($1,100,000,000). The estimated revenue from negotiable securities, upon which a tax is levied, was 1,070,200,000 francs ($206,000,000) in 1874, and 1,754,920,000 francs in 1898, —an increase of more than 70 per cent in twenty - four years. This item of the growth of the national wealth has been subject, moreover, to the modifying influence of the fall in the rate of interest. While French savings and French investments have greatly increased in their face value within the present decade, the advance in the net revenue and in the amount of tax collected has been small, because securities which formerly paid five and six per cent have fallen in their income-paying power, either by formal conversion or by the premium in the market, to rates of three and four per cent.
The civilized world is able, therefore, to pay the cost of a larger official class, if it renders services of value. Increased social wealth permits additions to the office - holding and professional classes, because the community has gotten beyond the point where the efforts of all, or nearly all, are needed for the work of obtaining subsistence and the rudiments of civilized life. The difference between the old conditions and the new is thus set forth by Professor William Smart: —
“ Society now supports—and gladly — a great many people who add nothing material. Once a day if a man had hinted that he should like to be a poet, a player, a singer, or even a journalist, he would have been looked on with curiosity and even suspicion, and for an intelligible reason. When bread and butter were scarce and were got by hard labor, it did look curious that a man should expect other people to share their bread and butter with one who did not produce, in return, something as tangible and nourishing as bread and butter. But, with the growth of wealth, all these occupations have become legitimate and honorable callings, wherein it is recognized that men give value for value, and there is a par of exchange between the products of the hand and those of the brain.”
That the increase of wealth permits additions to the professional and officeholding classes in a much greater ratio than that borne by the new wealth to the previous mass may be shown by a mathematical illustration. A community capable by its utmost exertions of producing only enough to supply its food and clothing would have no surplus for the machinery of government or for the support of the professional classes. If the productive power necessary to supply food and clothing be represented by 10x, an increase of productive power by 10 per cent, applied to the support of a small governing and professional class, will be represented by 1x. It is obvious that a further increase in the productive power of the community by the same amount, or one eleventh of its whole producing power, would raise the fund available for the governing and professional classes, not by 10 per cent, but by 100 per cent. A further increase of the old productive power by one eleventh (or of the new power by one twelfth) would permit three times the proportion of wealth to be devoted to the professional and office-holding classes that was devoted to them under the original conditions. If state expenditure alone were considered, an increase of one eleventh in the producing power of the community, under the conditions assumed, would permit double the state expenditure under previous conditions.
A small increase in productive power or in wealth, therefore, would permit a large increase in the ratio devoted to the professional and governing classes. These classes would not by any means reap the whole benefit of the new wealth. It would be necessary that all should produce more, and be able to exchange their surplus purchasing power for professional services, like those of physicians, lawyers, actors, and artists, in order that this exchange should permit the latter classes to live. The distribution of the increased wealth among the community would be such that a smaller number of persons than before would be able to produce all the food of the community, and a smaller number than before would be able to produce all the clothing. These groups would receive their compensation for increased productive power in greater comforts of living, and some of those who had formerly belonged to the food-producing classes, or their children, would ascend into the ranks of the skilled-labor and professional classes. Whether the distribution of the increased wealth was entirely equitable or not, the general tendency of its distribution could not fail to follow this direction. The professional classes, so far as they can be considered as independent of the producing classes, would in their turn have more wealth than formerly to apply to the gratification of their desires, and would increase their demand upon the less efficient classes both for products and for personal services.
The growth of the official and professional classes, so far as it is an index of the increased wealth of the community, is not to be deplored. The essential test of the value of these classes is whether they are rendering genuine services. If they are purely parasitic, they are a burden upon the community, of the most injurious character. This was conspicuously the case with the French nobility just before the Revolution. Every one remembers how vividly Taine sketches their privileges and exemptions, the absentee landlordism which drained away the riches of their estates, and their purely ornamental functions at the royal court, without even performing any of the duties of civil leadership. Originating in the useful offices of governors and leaders of the people, these functions had been superseded by the central government, and the privileged classes had become social vampires, drawing their vitality from the impoverished blood of the community. This has come to be the case to some extent with the hereditary nobility of many of the European countries, where they have preserved any real privileges. They have ceased to perform valuable functions, except perhaps to set the standards of taste in living and in art, and are supported by the labor of the community under property laws which make them the beneficiaries of the special privileges granted their ancestors, even if they have ceased to benefit directly by special privileges and exemptions accorded them to-day.
The professional classes, in their turn, may be little better than parasites, in communities where the number of doctors, lawyers, and the clergy is multiplied beyond normal needs. The best evidence of the excess in their numbers is found in their failure to earn a comfortable living. This condition, however, is not a permanent one in a growing country, as is the parasitism of the hereditary nobility of Europe. In many American cities and states, the diversion of too much of the talent of the community to professional employments has been gradually corrected by the accumulation of wealth, and the increased opportunities for professional employment which wealth and its management afford. It is in accordance with the laws of political economy that the professional classes feel more keenly than the producing classes the diminished production of periods of depression. With the masses, the need for food and other necessaries of living supersedes the necessity for professional services and entertainment, and diminishes the demand for them. Among the more advanced classes, however, even this influence is counteracted by the elevation of professional services, like those of the physician and the dentist, to the rank of necessities, which can no more be dispensed with than tooth powder or the bath.
How far the increase in public expenditure has been usefully applied to the benefit of the community is a problem which has been much discussed, and which it would require exhaustive analysis of many budgets to answer with precision. That it has been applied to many new purposes, and to old ones which were inadequately provided for, may be easily established. Education, improved highways, more and better public buildings, and the thousand details of sanitation have absorbed most of the increased expenditure which has not gone to maintain standing armies. In England and Wales, local expenditures have risen by more than 150 per cent within the past generation, — from £30,454,523 in the fiscal year 1868 to £78,774,774 in 1897. This increase has been applied largely to the expenses of police, sanitation, and local public works. School boards alone increased their expenditures, during the brief period between 1884 and 1897, from £4,530,242 to £10,139,366. In the United States, also, according to some recent calculations by Secretary Gage, salaries paid to school-teachers rose from $37,832,556 in 1870 to $55,942,972 in 1880, and $123,809,412 in 1899.
Among the subjects of federal expenditure in the United States are many which contribute to the promotion of commerce. Going back to the report of Secretary Howell Cobb for the fiscal year 1860, one finds under the War Department the trifling item, “ Improvement of rivers, harbors, etc., $221,973.” This may not have been an entirely representative year in such expenditures, but it was pointed out by President Arthur, in his message vetoing the appropriation of 1882, that the appropriations were only $3,975,000 in 1870, and $8,976,500 in 1880. The appropriation proposed in 1882, which aroused so much resentment throughout the country, was $18,743,875. The work of river and harbor improvement has since then received a wonderful extension, and has been made the subject of continuing contracts instead of casual appropriations from year to year. The net disbursements by warrants for the fiscal year 1898 were $20,785,049, and for 1899 $16,082,357. This is only a small part, moreover, of the appropriations now made for the promotion of commerce. Deficiencies in the postal revenue are a contribution toward the extension of the mail service into remote sections, and toward fast mail trains and the carriage of great masses of periodical and advertising literature. The postal deficiency of 1898 was $10,504,040, and that of 1899 $8,211,570. If it fell to a less amount for the fiscal year 1900, it was because of larger revenues, and not because of the unwillingness of the government to thrust its hand into the pocket of the taxpayer for the purpose of promoting a widespread and efficient service. The lighthouse establishment, which called for $835,373 in 1860 and $1,767,515 in 1874, received $3,118,833 in 1899. While these figures are small, they represent an increase of 300 per cent within forty years, and nearly 100 per cent within the present generation.
Items of this character, always recognized as a necessary part of the duty of the federal government, give only a faint idea of the new fields in which the accumulated wealth flowing into the coffers of taxation is being spent on works which contribute to the scientific education, the public information, and the general equipment of the country for rivalry with foreign producing nations. Many of the scientific bureaus of the government, like the Weather Bureau, the Patent Office, colleges for agriculture and mechanic arts, the Coast and Geodetic Survey, eat up amounts which do not seem large from the modern point of view, but which would have made a serious impression on the modest budget of 1860 or 1870, even if due allowance were made for the difference in population. It does not affect the argument that some of these offices, like the Patent Office, are partly sustained by fees, since the gross cost of their maintenance, as compared with the similar cost in the past, is one of the measures of the increased resources of the country.
The growth in the public wealth is the explanation of the patience with which the country bears the munificence of Congress toward the pensioners of the Civil War. Never in the world’s history have such sums been distributed to soothe the declining years of those who suffered for the flag as by the United States during the last decade. The largest amount paid for pensions up to the Civil War was in 1820, when $3,208,376 was distributed. The country then had a population of a little less than ten millions, so that the pension charge per capita was about 35 cents. This charge rose in the fiscal year 1885 to $56,102,267, which was about $1 for each inhabitant of the United States, or about $5 for the average family. The progress of fifteen years raised the pension expenditure for the fiscal year 1900 to $140,875,992. This is not much less than $2 per capita, or more than the cost of the federal government for all purposes (barring one year of the Mexican war) down almost to 1860. If the costs of the military and naval establishment last year were added to the expenditure for pensions, the burden upon the American people for these objects was about $4.40 per head, or very close to the entire military and naval expenditure of the Empire of Napoleon when he was leading the “ Grand Army ” of 600,000 men to its death amidst the snows of Russia.
The growth of the official classes is not to be feared so long as they are performing functions which are clearly useful. There is an unmistakable tendency, in democratic countries, where the system of using offices as political rewards prevails,— just as there used to be in monarchical countries, where offices were distributed as favors by the monarch, — to create useless functions, and to divide up those which are useful among an unnecessary number of public servants. This was notably the tendency in Great Britain under the Stuarts and the Georges, when sinecures were freely granted in order to pension the favorites of the king. It has been a favorite device among the political bosses of our great cities, where Tom, Mike, and Isaac have to be “ taken care of ” by the city because they have a “ pull ” in their wards. But these illustrations of an unfortunate tendency to abuse the good nature of the public should not obscure the truth: that the public can afford to employ more servants under modern conditions than under old ones, and can obtain from them valuable services in promoting the comfort of the people and developing the economic power of the community. The lesson taught by abuses of political power is only that of every-day business, — that the rules of honesty and efficiency should be rigidly applied in public as well as in private service.
Closely related to the subject of increased public expenditure is that of the creation of public debt. The growth of such debts was the cause of grave anxiety to political economists early in the century, while they found defenders, on the other hand, among those who saw the benefits of negotiable securities in attracting the wealth of a country from its hiding places into a common mass, and in affording a means of absorbing the fund of surplus capital which was just coming into being. The fact soon came to be recognized that the virtue of the debt depended in a large degree upon its object. Primarily, a debt for a useful and productive purpose is more justifiable than one for a wasteful purpose, like that of war. But the instinct of self-preservation is a dominant one among men, and has apparently led nations to assume debts for war with lighter hearts than for almost any other purpose. In many cases such expenses have been wanton and wasteful; but where national life has been the stake of war, the creation of debt might perhaps be defended for the preservation of political independence, without which independent economic life would cease to be possible.
There is not room in this discussion to go into all the aspects of debt creation, nor to determine the limits of the sound principle of John Stuart Mill, that the expenses of war should be raised, as far as possible, by taxation rather than by loans. It is certain that the peace establishment of the army and navy, under ordinary conditions, should fall within the proceeds of taxation, and should not be permitted to impose a burden upon posterity. The justification for imposing burdens upon future generations is found only in the preservation of the national life; the extension of national power, which carries with it wider economic opportunities ; or the creation of permanent works, like railways and harbor improvements, whose benefits as well as costs will be shared by posterity. The latter object has had a large share in the increase in public debts in well-ordered states, during the past generation. The government of Russia increased its debt more than a thousand millions of dollars from 1887 to 1900, but nearly the whole of the amount has been applied to the creation of railways owned by the state, whose net earnings of $70,000,000(137,486,000 rubles) in 1898 much more than paid the interest on cost of construction, and left a handsome surplus for meeting other public charges. In Australia, also, $650,000,000 (£132,910,524) has been expended by the state in the construction of more than 14,000 miles of railway, mostly by the creation of public debt; but the net earnings of these railways were $20,000,000 (£4,069,805) in 1898, and they paid more than three per cent upon their cost.
Whatever the merits in the abstract of incurring public debts, there is no doubt that they bring a powerful stimulus to the development of new countries. The issue of negotiable securities, whether they come from the government or from private railway and industrial enterprises, puts into the hands of a poor and undeveloped community the means of obtaining the most efficient tools of production from abroad, without waiting until the requisite capital can be saved at home. Take the case of Australia, whose development has perhaps been more rapid within our generation than that of any other country of the same population and wealth. The people of Australia were in the fortunate position of having an almost unlimited credit with their English and Scotch countrymen, which enabled them to borrow more liberally and on better terms than any other people. They borrowed from 1871. to 1898 nearly a billion and a half of dollars (£294,212,000). This great sum was applied to railway construction, to the improvement of agricultural land and sheep-farming, to the employment of the best machinery for gold-mining, and to the development of manufactures.
The result of this influx of foreign capital has been to create a large debt, both public and private; but it has been also to give to Australia a rapidity and solidity of development which would hardly have been possible by the unaided efforts of her own people. With a population increasing by more than 250 per cent from 1861 to 1898, and more than doubling in the twenty-seven years from 1871 to 1898, her industrial growth was more remarkable still. Her total foreign trade rose from £39.729,016 in 1871 to £83,678,859 in 1897, or more than three times the amount per capita of the trade of the United States. The public revenues, including railway earnings, increased from $45,000,000 (£9,269,765) in 1871 to $150,000,000 (£31,272,588) in 1898. Deposits in the banks increased, during the same period, by five hundred millions of dollars (from £28,833,761 to £128,303,360), and the value of annual production per capita increased 100 per cent, and put Australia at the head of all countries in volume of production per head. The per capita production of Australia is about $130 (£26 14s. 9d.), while that of France is only $60 ; Great Britain, $40 ; Russia, $31; and even the United States, only $70.
These results could not have been achieved without the influx of foreign capital by the creation of debt in the form of negotiable securities. These securities were exchanged, through the usual medium of stock exchange transactions, for English woolens, hardware, mining machinery, wines, and other luxuries. They might not be acceptable directly to those who had machinery, cloth, and wines to sell ; but other people with surplus savings in England and Scotland were willing to buy these engraved pieces of paper, the bonds of the Australian governments, and the stocks and bonds of mining, railway, and investment companies. Thus, by the process of borrowing abroad, Australia was equipped, almost in the twinkling of an eye, with a mechanism of production which could have been built up out of her own savings only by the laborious efforts of several generations. By a somewhat similar process of borrowing abroad, the Russian Empire has increased its debt by nearly a thousand millions of dollars, but has encouraged an influx of foreign capital which has resulted in the creation within five years of stock companies showing a capitalization of $600,000,000.
The history of the century in public finance, therefore, and especially the history of the present generation, illustrates the benefits which may come to the community from a well-directed use of a part of its new wealth in the extension of state functions. The character of this extension need not be radically socialistic nor disturbing to the existing order, but may simply relieve the individual of many minor duties which could not be performed at all before, or were performed inadequately or at great individual expense. Just as the average man has ceased to try to be his own carpenter, physician, or lawyer, in spite of a breadth of culture which may include some knowledge of their duties, he has ceased to undertake the many functions relating to public health, instruction, and protection, which were formerly performed by the individual, because he could not afford to contribute from his slender surplus above the cost of maintenance to have them performed by others. The increase in public expenditures, great as it has been, has by no means kept pace with the increase of social wealth above the subsistence point, but has taken a fraction of these great resources, and sought to apply it to those improvements in social condition which can be best provided through state action. Modern social development, opening new means of comfort and luxury on every hand to the mass of men, would be strangely one-sided, if it left the functions of the state shut within the parsimonious limits of a century ago, or even a generation ago.
Charles A. Conant.