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THE ETHICS OF TAXATION.

The remark that Goldsmith in one of the incidental advantages such taxes afhis

essays lets drop apropos of the his- ford in consulting the convenience of the tory of a tavern is essentially true of the payer as to the time and the amounts of history of taxation, -it “is a true pic- particular payments, the great reason for ture of human infirmity,” in which“ we the existence of these taxes in every counsee every age equally absurd and equally try is their power to conceal from the vicious.” If this seem too disparaging to governed the real cost of supporting the the present age, consider for a moment government. The people, in whose inthe most obtrusive features of taxation terest the government supposedly is conin the world of to-day, or, rather, the ducted, must be induced to pay their most obtrusive features of the tax systems taxes in an unconscious condition, “ lest at of the most progressive nations. For, any time they should see with their eyes, despite its historical identity with early and hear with their ears, and should untaxation, we may no longer designate as derstand with their heart, and should be taxation the babit of the Orient, where converted” to a belief in another than taxes are indistinguishable from black- the dominant programme of expenditure. mail, and where the rich disguise them- If, on the other hand, we look away selves in rags to escape the exaction of from our Federal taxes to our system of the publican. Nor may we longer account state and local taxation, the crying inas taxation the archaic methods in vogue equalities of the latter are only too well in the land of the Grand Llama, where known. The millionaire émigré too frethe tax-collector, happening upon the quently escapes his just contribution, wayfarer, accosts him with complaints of while the widow's mite and the orphan's the cruel rigor of the winter, and, after a crust pay the very uttermost farthing. minatory flourish of his matchlock, re- Had the Lord questioned Mephistopheles marks, “Thy cloak, venerable brother." upon the subject of taxation exclusive Process like this is rendered unnecessary ly, the verdict of “ herzlich schlecht" in civilized lands by the proper extension would have needed but little qualificaof indirect taxes.

tion. Adam Smith, the sagacious father Instead of allowing the sovereign to of political economy, saw the situation in blackmail the subject, we graciously per- his day, and was sad, but the consolation mit the owner of personal property to

that he offered then is about all we have determine the amount of his contribu- to-day. “If a nation,” said he, "could tion to the public treasury, much as he not prosper without the enjoyment of might fix upon the gratuity to his waiter perfect liberty and perfect justice, there in a restaurant.

is not in the world a nation which could Seriously considered, the justification have prospered. In the political body, offered for indirect taxes is a most curi. however, the wisdom of nature has forous commentary upon our system of self- tunately made ample provision for remgovernment. In the United States, for edying many of the bad effects of the example, not far from half of the gov- folly and injustice of man; in the same ernment's total revenue is obtained by manner as it has done in the natural body disguising taxes in the prices of mer- for remedying those of his sloth and inchandise, either duty-paid imports, or temperance." liquors and tobacco freighted with the Whatever the causes for the persistence weight of the internal revenue. Despite of injustice and double dealing in finan

cial administration, one thing is certain, taxation stands related to what might be

- that these evils are not due to the ab- called the metaphysics of finance, and sence of enlightened inquiry into the na how the implicates of the science of ture of fiscal problems. One might in

One might in finance involve the fundamental theory this connection almost echo the remark of the state and the problem of human made of the medieval Italian cities, that personality. To the economist and docnothing could surpass the excellence of trinaire financiers, accustomed to grovel their treatises on money, or the wretch- here below in the sordid realm of mateedness of their actual currency. Of the rial wealth, and all the while disturbed extreme thoroughness with which the di- by the brawling of the market-place, this agnosis of the financial status of the body aerial flight will prove a much needed politic has been made, one is reminded boon. Their lungs need expansion in a by the appearence of Dr. Weston's re rarefied atmosphere. They need to rub cent volume. This work does not im- their eyes and sit up and read that port into the discussion any new practi “ taxes are in fact voluntarily paid, even cal plan for securing equity in taxation, though the attempt is almost universally for substantial agreement upon the prac- made to evade a part of them, or a protical ethics of taxation had long ago been test is made against their amount.” reached. That taxes cannot properly They need to learn that in a broad way be regarded as an insurance premium conscious membership in a state implies paid to the state for protection received, acquiescent cooperation in supplying its nor as a commercial equivalent for bene needs, and that, therefore, it is proper to fits enjoyed (except in case of special say that taxes are voluntarily paid, in the assessments levied to pay for public im- Hegelian sense previously referred to in provements to private property), - upon Dr. Weston's essay, according to which these points there has been for a long “the criminal wills his own punishment.” time substantial agreement among seri- There is here a striking coincidence, one ous students.

And, apart from those would think, between the Hegelian and obsessed with the idea that society has Pickwickian senses in which propositions no claim upon its members to take aught may be understood. in taxes except what society is first al It will doubtless stir the cynic devil in leged to have created in the rental values the blood of the typical economist to of land, universal homage has been paid read at the end of sixty-seven pages to the dictum that contributions to pub- of idealistic philosophy Dr. Weston's lic needs should be determined by the con- triumphant contention that he has detributor's ability. This canon of ability monstrated the intimate metaphysical has hitherto been treated as sufficiently relationship between Economics and explicit as to the matter of justice in Ethics. But this again is precisely what taxation. Indeed, the ingenuity of the the vast majority of economists need, text-writers has been mainly bestowed to have the truth seared upon their conupon finding concrete indicia of ability, sciousness that the scientific method of -such as income, property, expenditure, measuring the utility of wealth, where and the like, — and upon judging extant previous abstraction has been made of tax-laws by their conformity to such the moral character of its constituents, criteria. Very different is Dr. Wes can afford no fundamental basis of pubton's inquiry. He has undertaken rather lic policy, and can issue no imperative to show how the principle of justice in word of political guidance. In the face 1 Principles of Justice in Taxation. By STE

of the supreme questions the oracles of PHEN F. Weston, Ph. D. New York: The expediency are dumb. Macmillan Co. 1903.

But fully to fathom the iniquities that

attach to taxation we must leave the little of either, and that normally both financial experts to their own devices, cash and credit go together. It is posiand condescend to men of low estate. tively humiliating to think of the number It may be that the matter will become of political geese that have purchased somewhat clearer if we consider the lifelong immunity from the knife by average taxpayer, first as an exponent constantly cackling in our ears the story of conservative class prejudice, and sec- of their mythical ancestor who laid the ond as an example of individual frailty. golden egg. It seems to be forgotten The first will explain why unsparing re- that, as the late Mr. Whistler would form of our system of direct taxation is say, there is only one goose on record so unlikely; the second will make clear that ever did lay a golden egg, and that why our system of direct taxation is so the day of miracles is past. bad.

So it comes that first of all the fearThe taxpayer is above all things a some conservatism of the taxpayer is conservative animal. Before his name responsible for the fact that “not one of appeared on the assessor's roll, he was, the American states has ever adopted like Stevenson's bachelor, “fit for hero- the recommendations of its various exism or crime;" but taxes, like conscience pert Tax Commissions.” The farmer and matrimony, make cowards of us all. fumes at the proposed exemption of Let the average citizen interrogate his credits, and the city man is suspicious own consciousness and ask, “Am I of all far-reaching changes proposed in willing to risk a radical change in our taxation. system of taxation, by which doomage This reluctance to reconstitute the taxshall supersede self-assessment, and per- machinery is the more singular from the sonal property in the hands of the holder fact that those who are unwilling to risk be exempted altogether, this in order a substitute grumble over the imperfecto secure a thoroughgoing reform?” tions of the present system as loudly as and the answer will almost infallibly be the reformer who is bent on radical rein the negative. We are determined at adjustment. The typical yeoman and all hazards not "to fly to evils that we the well-to-do citizen of the lower midknow not of.” We must be dragged to dle classes, both of whom through their them, if we ever reach them at all. frugality own a modest homestead, but

In a way, it is really remarkable how little beyond, will bitterly oppose the excertain parables of caution have become emption of any form of personal propincorporated in the canons of our politi- erty. And yet individually they will cal scriptures. One cannot propose the often assent to the dictum of the West smallest innovation, except in accentu- Virginia Tax Commission, a veritable ating our truculent policy of foreign locus classicus in the literature of taxaggression, but that our political doc- ation, — which declared that “the paytors take us to task by recounting to us ment of the tax on personalty is almost the fable of the Dog and the Bone, and as voluntary, and is considered pretty beseech us not to sacrifice the reality for much in the same light as donations to the shadow. They never seem to reflect the neighborhood church or Sundaythat a plunge in a clear shining stream school.” may often be worth the sacrifice of a So far as taxation is concerned, our dry bone. They are continually exhort- electorate presents the incongruous specing us

tacle of radical prepossessions coupled “ To take the Cash and let the Credit go,"

with a paralyzing distrust of all efforts

at amendment. The doctrine of proforgetful of the fact that we really have gressive taxation, that the percentage of

taxes should rise as property or income to fill out an inventory of all kinds of is greater, is to the man in the street an personal property, itemized so minutely axiom. That a man's ability to contrib- that through its meshes absolutely no ute to the public chest is more than chattel or credit can escape. He is fredoubled when his income is doubled — quently, if not generally, required to dea proposition to the classical economist clare over his own signature, and not a stumbling-block, and to the hard-headed uncommonly upon oath, that the list relogician foolishness — has to the ordinary turned is complete and literally correct. voter of reflective turn of mind the stamp Under these circumstances the taxpayer of self-evident truth. The Philistine as almost universally commits deliberate sesses lightly the sacrifice of what he perjury, and omits, or knowingly underdesignates superfluous luxuries, which, values, what personal property he posunder progressive taxation, the well-con sesses; and

- moral paradox that it is ditioned classes would have to submit to. thinks none the worse of himself for The man of common clay has little ink- it. It has long been a truism among ling of the real pathos of Motley's cry, students of American finance that the “Give us the luxuries of life and we tax on personalty, as various official rewill dispense with the necessities.” He ports have it, “ has in effect become a finds it not a bitter, but an easy thing tax upon ignorance and honesty,” “ to look into the sacrifice of happiness school of perjury promoted by law,” “a through another man's eyes. But de- premium on perjury and a penalty on spite his radical convictions, extreme and integrity ;” and that, when the taxindefensible as they often are, he shakes payer's conscience is tender, “virtue is his head at any proposed change in our perforce its own reward.” system either of direct or indirect taxes, There is little use in drawing a long both of which notoriously impose the face over this situation, or of saying of heavier relative burdens upon the weaker all men at our leisure what the Psalmist shoulders.

said of them in his haste. The truth is But the average taxpayer represents that what we really need is a new code not only the conservative apathy of his or digest of what might be called Decasocial class, but another constituency as logical Limitations. The leading case, well, essentially a pocket-borough, to wit, so far as the commandment of veracity himself. Despite the fact that, under the is concerned, has already been decided usual process of assessing real estate, by a learned judge who refused to admit the taxpayer has comparatively little as proper evidence of a witness's general power over his assessment, when it comes reputation for veracity the tax-duplicate to the declaration of personal property, he which said witness had returned under has almost unlimited liberty of “writing oath. The common sense of mankind himself down,” not an ass, but a pauper. will support this decision. “In lapidary In a sense there is no more curious prob- inscriptions,” as Dr. Johnson has delem in social psychology than the way in clared, “a man is not upon oath.” which the ordinary taxpayer interprets, Nor, we may add, is a fisherman when and the degree in which he discharges, questioned as to his catch ; nor a woman, the duty that rests upon him, of contrib- if one is graceless enough to ask her uting to the expenses of the government. age; nor, of course, a God-fearing burThe elements in the situation, so far as gess when he fills out his tax-bill. Must the taxation of personal property is con one always squat in the dead centre of cerned, are these : the individual is con verity, and “never hover upon the confronted with his duty to an abstract per- fines of truth ?” Does not Jove himsonality, the government; he is required self laugh at lovers’ vows? Why all

this simulated concern over taxpayers' "And thanne curseth be the kynge and all his oaths ? If “charity is a demand for

conseille after, beggars,” self-assessment is a demand

Suche lawes to loke (enforce] laboreres to

greve.” for perjury. That the supply of either should fail to be forthcoming would be Fortunate is it for us that the lines upon an anomaly indeed.

which the reform of direct taxes must Nor let it be fancied that this vice is proceed have been so clearly marked out, wholly a masculine peccadillo. If one and that some of our commonwealths would see what Lombroso, the Italian have already taken pronounced steps in criminologist, calls the Female Offender, the right direction. The taxation of real let him but visit the custom house. The estate by and for the local governments exemplary mother of a family is return- exclusively, the practical exemption of ing from abroad, and with a ferocity credits and chattels in individual hands, which quite overpowers the protest of and the relegation both of the adminisher husband's " struggling, tasked moral tration and the proceeds of corporate ity,” she delights to outwit the ferret- taxation to the state governments, forefaced inspector on the dock, at the cost shadow the financial reform to which we of asseverations which would have put may some time attain. St. Sapphira herself to the blush.

But if the vision of an equitable sysThe conclusion is plain. The law, as tem of direct taxation seems not imsome one has well put it, is such a frag- possible of realization in the proximate ile thing, that when men take it into future, the prospect for a similar adjusttheir own hands, it is almost sure to get ment of Federal imposts is as yet bebroken. If we want to continue to have clouded and dim. The craft of state our tax-laws broken at the expense of finance and local finance ply the shelindividual veracity, all we have to do tered channels of fairly stable and calis to continue the present arrangement culable expenditure; the national ship of self-assessment or declaration of per- of state has to breast the uncharted sonal property

waters of international politics and enIf it be asked what is the prospect of counter the storms of war. When to the an intelligent reform of taxation, the an- difficult task of providing sums whose swer must be that the effective impulse aggregate must vary greatly from year will probably come only from a sensibly to year, there is added the additional increased pinch of taxation. Peaceful task of giving through taxation a conreforms, like warlike revolutions, crawl stant protective stimulus to certain indusupon their belly. Jeshurun may have tries, the double and often conflicting de“ waxed fat and kicked,” but modern mands made upon our Federal financiers peoples generally reverse the scriptural are obvious. Were the protective funcorder. The Revolution in France and tion of our Federal taxes done away with, Chartism in England were the signifi- while there would still remain perplexicant precursors of the two greatest tax ties great enough in all conscience, one reforms of modern times. This tendency of the unknown and baffling factors in of social unrest to unsettle social injus- the problem would be eliminated. tice long antedates our modern demo- For over a generation many unselfish cracies. As far back as the fourteenth and thoughtful American citizens have century in England, the author of Piers cherished the hope and the aspiration Plowman was enough of a political phi- that the intrinsic injustice of our nalosopher to observe that, when the fluc- tional system of taxation might be extuating tide of prosperity is once past, tirpated, not at the unreasoning anger of Demos becomes restless.

the victims of its oppression, but at the

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