tracts, on which ground certain provisions in the revenue laws of some of the states have been set aside.

eign-held bonds.

But constitutions are themselves subject to a higher right, even the right which determined how they should state tax on for. be made; and, beyond these restrictions set by the consti- 15 Wallace, 300. tution of Massachusetts and that of the United States, it becomes us to inquire if any bounds are also determined by the original right of taxation itself.

The individual person has no inalienable rights except that to his own righteousness. His property, his labor, his liberty, his life, are not inalienably his. He may forfeit them by his own act, or the state may require them for its own needs, in which cases the individual yields. them justly to the state. The state may demand every thing which belongs to a man, except his manhood and his moral integrity, which he has no right ever to surrender.

tract between

Now this supreme right of the state to every required Theory of conservice of its subjects, is often supposed to rest on some state and citizen. implied contract, whereby the subject is bound to render some service to the state, as a recompense for the service which the state has rendered him. The state protects a man in his person and his property, and furnishes him many means of enjoyment, from which the inference is easy, that a man should pay the state his proportional equivalent. In this view the state stands to its citizens in a relation somewhat like that of an insurance company to its policy-holders. Pay me so much money, and I guarantee you so much protection.

But this view does not hold. It has two great fallacies. Waiving the question whether every one has ever made such a contract, and whether the state could release any one therefrom should he claim to set up for himself, such a notion would surely cstop the state from demanding the whole property or the life of its subjects in any case where these were not forfeited by crime; and it would fairly permit a claim for indemnity wherever the state had failed to protect. We may, therefore, set this view aside.

The true theory of taxation.

· Constitution of Mass., Part 2d,

IV.

"

A man is taxed not to pay the state for its expense in protecting him, and not, in any respect, as a recompense to the state for any service in his behalf, but because his original relations to society require it. All the enjoyment which a man can receive from his property comes from his connection with society. Cut off from all social relations, a man's wealth would be useless to him. In fact, there could be no such thing as wealth without society. Wealth is what may be exchanged, and requires for its very existence a community of persons with reciprocal wants. Gold and silver to any amount is not wealth till it is put into the hands of some member of society, and becomes a means wherewith he can serve others, and receive some service from them in return. But not only are the enjoyment and even the existence of wealth wholly a social creation; not only would they cease entirely if men were only individuals, living each one alone or apart from others; but in like manner all social progress gives an increasing value to wealth, and a man's possessions grow in worth as he grows in the intimacy, and perhaps, also, in the intricacy, of his relations to his kind. It is wise and right, therefore, for an individual to contribute of his wealth whatever the true interests of society may require; and this he does, not as a payment for the gifts which society has conferred, -the creature does not serve his creator in payment for his creation, but because the law of his own well-being or perfection summons him thus to do.

From this it follows that, in the admirable language of ch. 1, § 1, Art. the constitution of Massachusetts, "proportional and reasonable assessments should be imposed and levied upon all the inhabitants of, and persons resident, and estates lying within the Commonwealth."

.

It is very difficult to determine in every case, what are proportional and reasonable assessments." This has probably never yet been perfectly done. Every system of taxation yet devised is liable to the charge of more or less injustice. Until the spirit which loves one's neighbor

as one's self is everywhere felt, and the great command, "Render unto Caesar the things which are Cæsar's," is loyally and universally obeyed, individuals will contrive to throw burdens upon others which they themselves ought to bear, and human selfishness and greed will render the practical working of any scheme of taxation often oppressive, however wisely and justly the scheme may have been conceived. The most important point, therefore, for a state, in matters of taxation, as in all its procedure, relates to the honesty, purity and unselfishness of its subjects.

public indebted

We cannot but view it as an injustice, though, doubt- Relation of less, often not regarded as such, that both the Common- ness to taxation. wealth herself, and the municipalities embraced within her jurisdiction, are so willing to incur pecuniary obligations which those of a future time will have to pay. If it be said that these are often for benefits which the future will enjoy, it cannot be denied that they often involve burdens also, quite disproportionate to the benefits received, while in many cases the future is taxed for the payment of debts which are only a curse without any compensation. We find the outstanding debt of Massachusetts, January 1, 1874, to be, $28,477,804. Added to this are the debts of the various cities and towns, aggregating at the same date, $67,277,188, making a sum total of $95,754,992, or 4.58 per cent. of the entire valuation of the Commonwealth. The available resources for meeting the state debt we find to be $13,448,800, which amount deducted, leaves the net debt of the Commonwealth $15,029,004. This sum added to the debt of the municipalities decreases the total indebtedness to $82,306,192, or 3.94+ per cent. of the valuation. The formidable amount of municipal liability is also offset, to some extent, by sinking funds applicable to their payment, the aggregate of which we have not been able to ascertain. In some of the larger cities we know that they exist to a considerable amount. But making a reasonable deduction for these funds, and allowing for an increase of liability in the form of county debts,

Recommenda

tion for limita.

tion of indebted

ness and for creation of sinking funds.

-the statistics of which we have not investigated,-the indebtedness of our cities and towns has reached an amount that is out of proportion to their present resources, and, if allowed to continually increase, will retard, not only their progress, but the prosperity of the Commonwealth.

That these debts, so serious in amount, have very often been improvidently incurred, for objects unnecessary or unprofitable, will be admitted by every one, as will also the fact that the tendency to run into debt which these figures disclose, is a wrong fraught with many dangers. The unparalleled growth of expenditure, the country through, which, not satisfied with eating up the proceeds of generous taxes, has plunged alike, the nation, the state, the county, the town, and almost every lesser municipality, into debt, ought to be recognized as one of our gravest public perils. But we fear there is no evidence of the diminution of this tendency, which, on the contrary, rather threatens to increase, and which we cannot but think is a matter calling for legislative interference, by the enactment of a statute which shall forbid any municipality to incur a debt beyond a certain fixed per cent. of the assessed value-at the time of the property taxable for its payment. We recommend, also, that municipalitics be required to provide that, for every debt created without special legislative sanction, taxation shall at once commence for a sinking fund, that shall meet the principal of the debt when due.

POLL-TAXES.

While poll-taxes are regarded as wise and just, we find a very considerable dissatisfaction with our present system respecting them, a dissatisfaction based upon the fact that in many places the voters assessed for poll-taxes only, outnumber all the rest. The majority, in such cases, are restrained by no fear of increasing their own taxes when the question of extravagant or large expenditure is to be decided, directly, in the town meeting, or indirectly, in the

choice of members of the city government. The poll-tax being limited to two dollars, the voter who has nothing else to pay, does not feel the burden of his vote for a new town hall, or a costly school-house, or public park, and may decide the question of such expenditures quite contrary to the judgment or the wish of those who must pay the taxes necessary thereto. If he is a laborer, the very vote which puts a new mortgage on his neighbor's farm, or factory, or dwelling-house, may give him employment, with the best of wages and a sure paymaster.

The value of a direct pecuniary stake on the part of every voter in the amount of appropriations voted, as a means of enforcing that economy in expenditure which alone can secure what all economists agree is the best tax, "that which is least in amount," was recognized in that provision of our law which declares that the assessors shall assess upon the polls, as nearly as may be, one-sixth part of the whole sum to be raised.

In the ideal New England community, where each voter and tax-payer was the head of a family, had a "settling lot" equal in area and value to that of his neighbor, an equal share in the common lands, and a pew in the meeting-house, perhaps the whole tax might have been justly and proportionably levied as a capitation, or poll-tax, while no great inequality was produced in raising the whole one-sixth of the tax in this manner, even after the people had departed quite extensively from the earlier New England type. But changes wrought by the growth Ane. L. and Ch. p. 70, c. 21, § 3. of villages and cities, and the increase of trade and manu- 1828, 143, § 3. factures, made so much difference in the abilities of citi- R. 8. c. 7, § 27. zens to contribute to the public charges, that it became 1862, 158. necessary to limit the tax to one dollar and fifty cents, and again, in 1862, to two dollars.

How far short the tax falls, at this limit, from the onesixth of the whole tax raised, will be seen from the following figures :—

1830, 151, § 2.

1859, 157.