not be intellectually and socially at least on a level with the bar. In most of the States where this system prevails the bench is respectable; and in some it is occasionally adorned by men of the highest eminence. Why have sources of evil so grave failed to produce correspondingly grave results? Three reasons may be suggested: One is the co-existence in every State of the Federal tribunals, presided over by judges who are usually capable and always upright. Their presence helps to keep the State judges, however personally inferior, from losing the sense of responsibility and dignity which befits the judicial office, and makes even party wire-pullers ashamed of nominating as candidates notoriously incapable or tainted men. Another is the influence of a public opinion which not only recognizes the interest the community has in an honest administration of the law, but recoils from turpitude in a highly placed official. The people act as a check upon the party conventions that choose candidates, by making them feel that they damage themselves and their cause if they run a man of doubtful character, and the judge himself is made to dread public opinion in the criticisms of a very unreticent press. Last, there is the influence of the bar. Lawyers have not only a professional dislike to the entrusting of law to incapable hands, but they have a personal interest in getting fairly competent men before whom to plead. Hence the bar often contrives to make a party nomination for judicial office fall, not indeed on a leading lawyer, because a leading lawyer will not accept a place with $4,000 a year, when h can make vastly more by private practice, but on competent a member of the party as can be got take the post. Having constantly inquired, in ever State I visited where the system of popular elections to judgeships prevails, how it happened that the judges were not worse, I was usually told that the bar had interposed to prevent such and such a bad nomination, or had agreed to recommend such and such a person as a candidate, and that the party had yielded to the wishes of the bar. These causes, and especially the last, go far to nullify the malign effects of popular election and short terms. But they cannot equally nullify the effect of small salaries. Accordingly, while corruption and partiality are uncommon among State judges, inferiority to the practicing counsel is a conspicuous and frequent fault. During recent years there has been a distinct change for the better. Some States which had vested the appointment of judges in the legislature, like Connecticut, or in the people, like Mississippi, have by recent constitutional amendments or new Constitutions, given it to the governor with the consent of the legislature or of one House thereof. Others have raised the salaries, or lengthened the terms of the judges, or, like New York, have introduced both these reforms. The American people, if sometimes bold in their experiments, have a fund of good sense which makes them watchful of results, and not unwilling to reconsider their former decisions. CHAPTER VIII STATE FINANCE The financial systems in force in the several States furnish one of the widest and most instructive fields of study that the whole range of American institutions presents to a practical statesman, as well as to a student of comparative politics. All I can here attempt is to touch on a few of the more salient features of the topic. What I have to say falls under the heads of Purposes for which State revenue is required. Forms of taxation. Exemptions from taxation. Methods of collecting taxes. Limitations imposed on the power of taxing. Restrictions imposed on the borrowing power. I. The budget of a State is seldom large, in proportion to the wealth of its inhabitants, because the chief burden of administration is borne not by the State, but by its subdivisions, the counties, and still more the cities and townships. The chief expenses which a State undertakes in its corporate capacity are (1) The salaries of its officials, executive and judicial, and the incidental expenses of judicial proceedings, such as payments to jurors and witnesses; (2) the State volunteer militia; (3) charitable and other public institutions, such as State lunatic asylums, State universities, agricultural colleges, etc.; (4) grants to schools; (5) State prisons, comparatively few, since the prison is usually supported by the county; (6) State buildings and public works, including, in a few cases, canals; (7) payment of interest on State debts. Of the whole revenue collected in each State under State taxing laws, a comparatively small part is taken by the State itself and applied to State purposes. In 1882 only seven States raised for State purposes a revenue exceeding $2,000,000. The State revenues are small when compared either with the population and wealth of the States, or with the revenue raised in them by local authorities for local purposes. They are also small in comparison with what is raised by indirect taxation for Federal purposes. II. The Federal government raises its revenue by indirect taxation, and by duties of customs and excise, though it has the power of imposing direct taxes, and used that power freely during the Civil War. State revenue, on the other hand, arises almost wholly from direct taxation, since the Federal Constitution forbids the levying of import or export duties by a State, except with the consent of Congress, and directs the produce of any such duties as Congress may permit to be paid into the Federal treasury. The chief tax is in every State a property tax, based on a valuation of property, and generally of all property, real and personal, within the taxing jurisdiction. The valuation is made by officials called appraisers or assessors, appointed by the local communities, though under general State laws. It is their duty to put a value on all taxable property; that is, speaking generally, on all property, real and personal, which they can discover or trace within the area of their authority. As the contribution to the revenues of the State or county, leviable within that area, is proportioned to the amount and value of taxable property owners, an obvious motive for valuing on a low scale, for by doing so they relieve their community of part of its burden. The State accordingly seeks to check and correct them by creating what is called a board of equalization, which compares and revises the valuations made by the various local officers, so as to secure that taxable property in each locality is equally and fairly valued, and made thereby to bear its due share of public burdens. Similarly a county has often an equalization board to supervise and adjust the valuations of the towns and cities within its limits. However, the existence of such boards by no means overcomes the difficulty of securing a really equal valuation, and the honest town which puts its property at a fair value suffers by paying more than its share. Valuations are generally made at a figure much below the true worth of property. Indeed one hears everywhere in America complaints of inequalities arising from the varying scales on which valuers proceed. A still more serious evil is that fact that so large a part of taxable property escapes taxation. Lands and houses cannot be concealed; cattle and furniture can be discovered by a zealous tax officer. But a great part, often far the largest part of a rich man's wealth, consists in what the Americans call “intangible property," notes, bonds, book debts, and Western mortgages. At this it is practically impossible to get, except through the declaration of the owner; and though the owner is required to present his declaration of taxable property upon oath, he is apt to omit this kind of property. In every part of the country one hears this. The tax returns sent in are rarely truthful; and not only does a very large percentage of property escape its lawful burdens, but "the demoralization of the public conscience by the frequent administration of oaths, so often taken only to be disregarded, is an evil of the greatest magnitude. Almost any change would seem to be an improvement." I have dwelt upon these facts, not only because they illustrate the difficulties inherent in a property tax, but also because they help to explain the occasional bitterness of feeling among the American farmers as well as the masses against capitalists, much of whose accumulated wealth escapes taxation, while the farmer who owns his land, as well as the workingman who put his savings, into the house he lives in, is assessed and taxed upon this visible property. We may, in fact, say of most States, that under the present system of taxation the larger the city |