Part 3

Nome prints to-day three newspapers, the first issue of the first journal, the Nome News, appearing about the 10th of October. Its selling price was twenty-five cents. Up to the time of my leaving, there were no serious disturbances of any kind, but indications of trouble, resulting from the disputed rights of possession, whether in the form of squatter sovereignty or of purchase, were ominously in the air, and it was feared that should serious trouble of any kind arise, neither the military nor civil authorities would be in a position to properly cope with it. It was freely admitted that the community was not under the law that so strongly forces order in Dawson and the Klondike region. Much more to be feared than disturbance, for at least the first season, is the possibility of conflagration; closely packed as are the tents and shacks, with no available water supply for combating flames, a headway of fire can not but be a serious menace to the entire location, and one which is in no way lessened through the general indraught of hurricane winds. The experiences of Dawson should have furnished a lesson, but they have seemingly not done so, nor has apparently the average inhabitant profited in any effort to ward off the malignant influences arising from hard living, unnecessary exposure to the inclemencies of the weather, and a non-hygienic diet. Hence, typhoid or typho-malarial disease, even if not in a very pronounced form, has already sown its seeds of destruction, and warns of the dangers which here, as in Dawson, man brings to himself in his customary contempt for the working of Nature’s laws.

A STATE OFFICIAL ON EXCESSIVE TAXATION.

BY FRANKLIN SMITH.

It is not to government reports that a student of social science looks for warnings against the perils lurking in the enormous expenditures and the extraordinary enlargement of the duties of the state. Officials are usually so deeply impressed with the importance of their positions and so anxious to magnify the worth of their labors that they are prone to take the rosiest view of any part of the great clanking machine intrusted to their care. With the keenest pride they point to their achievements in furthering the work of human welfare. If modesty does not restrain them, they are certain to paint, with an artless faith in their own abilities, the still greater work that could be done with a slight increase of funds and a little more assistance. Not all officials, however, permit themselves to indulge in the natural vanity of bureaucrats. They refuse either to be blinded to the perpetual failure of state-made civilization, or to deceive the impoverished victims of the same costly system of modern magic. Of the very few of this class Mr. James H. Roberts, for five years Comptroller of the State of New York,[A] is perhaps the most conspicuous. Astray as he is on the question of a graded inheritance tax, and trustful as he is in the virtue of State supervision, he puts himself beyond criticism in his opposition to the policy of State socialism, now the rage at home and abroad. Indeed, no one could hold it up to graver reproach.

[A] He was in office from January 1, 1894, to January 1, 1899.

Whenever an observer of the signs of the times in the United States ventures to say that they offer little food for hope, he is branded as pessimistic or unpatriotic. He is told that if he had the confidence in democratic institutions of a man with a good digestion and a fair intelligence, he would know that they possess a vitality, a power of rejuvenation, that does not belong to an autocracy nor an aristocracy. If he is particularly despondent, and seeks to justify himself with fact and argument, he is denounced as a dangerous agitator, or, what is a shade more odious, as an absurd _doctrinaire_. But Mr. Roberts has not been consigned to any such depths of contempt. He is known as a “hard-headed business man,” a title of honor that always frees the most ridiculous optimist from any suspicion of the theorist or sentimentalist. Yet, as the supervisor of the finances of a great State, he was brought in contact with a mass of phenomena that forced upon him the conviction that something is wrong, and that if it is not righted it will bring disaster. Indeed, I do not recall a pessimist, however dyspeptic, nor a _doctrinaire_, however visionary, that has struck a more melancholy note than he. In all his reports much will be found that indicates anything but a belief that a democracy that plunders and enslaves a people is any better than any other despotism guilty of the same offense, or that the practice in the one case will be productive of greater prosperity and happiness than in the other.

It is, however, in the report for 1897 that Mr. Roberts gives the fullest expression to his apprehensions. “This country,” he says in an elaborate argument for a graded inheritance tax, which he believed would bring some relief to the poor and discontented, “has just passed through the most threatening political campaign in its history. The portents in 1896 were vastly more dangerous than those of 1860, when peace and internecine war hung in the balance. Issues were advanced last year, and vigorously supported by a large element of the American electorate, which, if adopted, would have undermined the very foundations of American institutions. These issues were largely the outgrowth of discontent among the people. The farmer, as a class, the work people, and the small trade folk were in distress.... Hundreds of thousands of industrious people were out of employment, the best efforts of the farmer had been attended with poor results, and the small tradesman and business man were worse off than if they had been doing nothing.” In the report for the following year he spoke again of the “public discontent and dissatisfaction with existing conditions in this State.” Instead of joining the comfortable and contented in a denunciation of them as a delusion, born of envy or criminal instincts, he expressed the opinion that they had a very substantial basis. “My four years of close official study of the State finances,” he says, “compels me to say there is serious ground for complaint.” After giving an impressive summary in another place of the enormous increase of public expenditures within recent years he is moved to ask, “Whither are we drifting?”

The answer commonly given to this question is one quite flattering to American vanity. It is that we are drifting away from “parochial” things and taking our proper place as a great “world power.” Having solved all the petty problems that have absorbed our thoughts and energies for a hundred years, we have gone forth to “take up the white man’s burden,” and to solve the greater problems that a discriminating Providence has so wisely confided to our ability and philanthropy. At the same time we are going to have our say as to how the affairs of the world outside of our narrow and cramping borders shall be managed. Mr. Roberts, however, does not appear to take any such pleasant view of the future. He has none of the blood of Don Quixote flowing in his veins. The bestowal of the blessings of a Christian civilization with machine guns upon breech-clouted savages has no attractions for him. He sees that we have made such a disgraceful failure of the management of the contemptible things in which we have been so ignobly absorbed that we are threatened with national decadence! “While the contests against unjust and oppressive taxation,” he says in his report for 1899, “have been the contests of freedom and civil and religious liberty in the world, it must not be forgotten that unjust and burdensome taxation has been in all ages the most prolific cause of national decadence as well. There are nations in Europe, once great and prosperous,” he adds, thus recalling the warnings of Lord Salisbury’s famous speech on the same subject, “which to-day seem dying of dry rot because, to meet their immense expenses and to pay interest on their great bonded debts, taxation has been increased beyond the safe limit, and the very sources of national prosperity have been taxed so that they run dry, or send down a rill where it should be a river. Few national diseases are more dangerous or harder to cure than burdensome taxation. Can any one charged with the responsibility of making tax laws,” he asks, profoundly stirred by the startling facts that have come under his observation, “afford to ignore the undoubted lessons of history or the manifest tendency of the times in the matter of revenue raising and expending?”

Obvious as is the fitting answer to this question, it is one that few people stop to give. Both the lessons of history and the tendency of the times are willfully and incessantly ignored. Not only are they ignored by demagogues, who thrive most when public distress is greatest, and by misguided philanthropists, who seek to relieve it in ways that only intensify it. Even publicists, whose studies in history ought to make them more familiar with the signs of social decadence than a man of affairs with vision less extended, ignore them also. They seem to be as insensible to the real significance of what is going on before their eyes as the wooden totems of a burning tepee. But to minds more alert and penetrating, even if less congested with musty lore and fine intentions, the flight of the farming population to the cities is something besides “a great natural movement toward urban life that accompanies an advance in civilization”--it is a desperate but futile attempt to escape conditions that have become too hard to be borne. The swarms of impoverished and degraded humanity that crowd the slums to suffocation are not altogether the product of willful sloth and incapacity; they are due, in a measure, to the growing taxation that has wiped out the narrow margin that separates independence from dependence--self-support and self-respect from destitution and pauperism. The hatred of the rich, the denunciation of capital, the contempt for the Church, the bloody insurrections of labor, the general feeling of rancor, accompanied by an increase of the tyranny of trades unions and government regulations, are not the inevitable manifestations of envy, ignorance, and criminal instincts; they are the inevitable fruits of the perpetual aggressions in a thousand forms that spring from politics and war. But instead of acting upon this natural interpretation of the signs of the times and seeking to solve the social problem in the only way that it can be solved, the “new” reformers tormenting the world are engaged in the invention of schemes that add to the public burdens and hasten the nation’s decay.

The reckless expenditure of public money in the United States has not been confined to any particular political division nor to any particular geographical section. The national, State, and municipal governments have seemed to vie with one another in the plunder of the taxpayer. From the North, the South, the East, and the West have come the same complaints of excessive burdens.[B] But figures are needed to give these statements the vividness of reality. Beginning with national expenditures, Mr. Roberts says that during the decade from 1820 to 1830 they were $1.07 per capita; from 1851 to 1861, they were $2.06; and for the year 1894, $6.08. “In a word,” he adds, “the per capita expense of the national Government in 1894 was nearly six times as great as it was in 1820, and nearly three times as great as it was in the decade before our great civil war.” The per capita expenditures of the State of New York in 1830 were $1.30, thirty years later they were $1.89, in 1890 they were $2.15, and “in 1897 the estimated per capita expenditure reached the alarming amount of $4.95.” That is to say, the combined expenditures of the State and national governments gave a rate as high as that prevailing in France before the outbreak of the Revolution. “The tendency to increase,” says Mr. Roberts, commenting on these figures, “is a persistent one. In 1881 the amount expended by the State was $9,878,214.59; in 1884, $10,479,517.31; in 1887, $14,301,102.48; in 1890, $13,076,881.86; in 1893, $17,367,335.98; and in 1896, $20,020,022.47.” Coming to municipal expenditures, where the hand of the prodigal has been most lavish, Mr. Roberts says that “between 1860 and 1880 the municipal debts of our Union increased from $100,000,000 to $682,000,000, and in fifteen cities, believed to represent the average, the increase in taxation was 362.2 per cent, while the increase in taxable valuation was but 156.9 per cent, and of population but 70 per cent. In the year 1860 the direct taxes for State, county, town, and city purposes in New York were $4.90 per capita, in 1880 it was $8.20, and in 1896 it had reached $10.43, an increase in thirty-six years of 213 per cent.” It should be added that the bonded debt--State, county, city, town, village, and school district--in the State is estimated by Mr. Roberts to be $450,000,000. Is it any wonder that people so mercilessly plundered feel that the times are out of joint? Is it any wonder, either, that in 1896 Mr. Roberts was moved to say that, without the discovery of new sources of revenue, “a low tax rate would never again be enjoyed in this State”? Is it any wonder, finally, that he declared again that if “we have not yet passed the danger limit of taxation,” we have reached “a point where there is a deep feeling of unrest and dissatisfaction, and where a halt should be called or there will be danger”?

[B] From the mass of proofs of this statement in my possession I will select only one. In a call for a convention at Portland, Me., on the 10th of June last, of all persons “interested in the revision of the present system of State taxation and a more economical management of the State affairs,” it is stated that “the expenses of the State have increased fifty per cent in ten years, while the wealth and population of the State have steadily declined.” The object of the convention was “to protest against the course of extravagance that is rapidly bringing reproach upon the government of the State and reducing the farmers and taxpayers to automatons to grind out revenue to be absorbed by a rapacious and ever-multiplying horde of office-holders, who devour the people’s substance as fast as they produce it.” After showing how “once prosperous farming towns and townships have been reduced to but little better than a howling wilderness,” the call says in conclusion: “These once prosperous farming communities were redeemed from the native wilderness by men who were no more temperate, industrious, or economical than the farmers of to-day, and the prices they received for their products were as low as, and in some instances lower than, to-day, but the fruits of their honest toil were not drawn from them as fast as acquired by national, State, county, and, in many instances, by municipal extravagance, as it is to-day.” The plundered peasantry of Spain, Italy, or Russia, army ridden as they are, could not have made a more just complaint.

The stock explanation of this growth of expenditure is that with the advance of civilization the cost of government must increase in like degree; there must be more regulation and supervision of the activities becoming more numerous and complex. But this means, if it means anything, that the more enlightened and humane people are, the more difficult it is to maintain order and enforce justice, the more inclined are they to attack and plunder one another--in a word, the more barbarous they are. Preposterous as this theory of civilization is, it is precisely the one upon which the American people are acting with unparalleled energy. While we should naturally think them moving toward a point where they could get along without government, they are moving toward a point where they will have nothing but government. Referring to the increase of expenditures already mentioned, Mr. Roberts says it “corresponds almost exactly with the increase of the number of commissions and departments.... These departments and commissions,” he continues, “are largely for the purpose of extending social supervision and regulation over many things which, in the earlier days of our Commonwealth, were left to the localities or to self-regulation.” Again he says: “The amount of State inspection has become very great, reaching out constantly over new fields, and employing in the aggregate an army of inspectors.... The system of _laissez faire_, which was the rallying cry of democracy and free government at the beginning of the century, has yielded gradually to a system of supervision and control which monarchies never attempted.... What our State has done in this line can not probably be undone,” he says in a repetition of his warning, “but this tendency to expand and multiply and differentiate and segregate State supervision and regulation must cease, or the burden will soon become too grievous to be borne.”

But there is no warrant for the assumption that the more civilized we are--that is, the greater our self-control--the more are we in need of inspection and regulation. Such an explanation of the enormous increase in public expenditure is worthless. The true explanation lies in the greed of politicians and the delusion of social reformers. To both of these causes must be attributed the evils that Mr. Roberts deplores. “The truth of history,” he says, referring to the thirty-six new offices and commissions created since 1880, “compels the statement that it looks as if many of these creations were made not so much to satisfy a public want as to relieve a political situation.” That is to say, they were designed to provide spoils for the insatiable maw of politicians. One of the most flagrant examples of this popular method of forwarding the beneficent work of civilization and hastening the dawn of the millennium is the State Board of Mediation and Arbitration, created in 1886. Up to the present year it has cost the taxpayers $195,828.57. For this expenditure little can be shown but a shelf full of reports seldom read, and a pigeon hole of vouchers for salaries never earned. With one of the former members of this board, who served thirteen years and received $39,000 for his able services, I am personally acquainted. Of my own knowledge, I can say that for nearly three years at least his duties as commissioner never interfered perceptibly with his duties as editor. That most of the other offices and commissions are equally worthless there can be no doubt. Altogether they have cost the State the startling sum of $31,768,899.85, and are increasing the public burdens at the rate of more than $1,000,000 a year. But their true character as asylums for decayed politicians, or as stepping stones for ambitious young ones, and at all times as centers of political intrigue and personal profit, is gradually dawning upon the public. Already several Governors have demanded, in their annual messages to the Legislature, that they be consolidated or abolished. As yet, however, it has been impossible to relax their grip on the taxpayer. Obedient to the instincts of their kind, they are inventing new arguments to establish their claims to the confidence and gratitude of the victims of their greed and incompetency.

But the creation of new and needless offices is not the only manifestation of what Mr. Roberts fitly calls “the vicious tendencies of legislation.” More demoralizing are the laws that actually encourage the robbery of one class of people for the benefit of another. A familiar example is the bounty law for the destruction of fishing nets. Almost as soon as passed it produced a new industry--namely, the manufacture of cheap nets, which were deposited in fishing waters, subsequently discovered and seized by a pre-arrangement, and made the basis of demands upon the public treasury out of proportion to their value. So great have been the frauds perpetrated under it that the cry for its repeal comes from every quarter. Another law even worse morally was passed to meet the clamor of the bicyclists and bicycle manufacturers. It provides that twenty-five per cent of the cost of so-called good roads to be built under it shall be paid by the State. As cities and villages are exempt from its provisions, this sum, which comes out of the pockets of all taxpayers, urban as well as rural, is, as Mr. Roberts says, simply “a gratuity to the towns for the benefit of country roads.” As a sign of the moral decadence of the times, I ought to add that one of the most powerful and effective arguments in favor of the law was this very discrimination. Still more shameless was one of the chief arguments in favor of the Raines liquor law. With a moral callousness truly astounding, its advocates framed tables of figures to show how great a percentage of taxation it would shift from the country to the city districts. In the heated political campaign that followed, these tables were made to do service again to save from defeat the party responsible for the enactment. To indicate, finally, how legislation may encourage vice, I must not omit to mention the provision that created the Raines hotel. Under it assignation houses have multiplied to a degree that Satan himself could not have foreseen nor have been more enchanted with.

But the greatest inroads on the pockets of the taxpayer have been made under the pretense of charity. I say “pretense” because it is a gross misuse of language to decorate with so fine a word the seizure of a man’s property under the forms of law and to devote it to the ostensible relief of want and suffering. It is the infliction of an aggression that has no more warrant in a court of sound morals than the seizure of his property in disregard of the forms of law. Yet this evil has reached such vast proportions that Mr. Roberts was moved to protest against it. After speaking of “the tendency of the State in building up a gigantic system” that “will call for an enormous and ever-increasing annual expenditure for maintenance,” he expressed the belief in 1896 that “the time has come to call a halt before this burden of taxation becomes too heavy.” He then mentioned the significant fact that while the State spent $6,000,000 for charity, $4,800,000 for public schools, $800,000 for the militia, it spent only $500,000 for judges’ salaries! He pointed out also that the expenditures under the head of charity had increased from $1,468,471.58 in 1887 to $5,888,193.74 in 1897, or over four hundred per cent in ten years. He added the prophecy that it would be “a matter of a short time only when the annual expenditures for charity alone in this State will reach $10,000,000.” At that time five large State charitable institutions were in process of construction, and were soon to be thrown open to the public. In the following year he reverted to the subject in still stronger terms. “God forbid,” he says, “that I should put a straw in the way of charity rationally directed; but my four years’ experience as comptroller ... compels me to say that charity is dispensed in this State with an almost lavish hand, and in my judgment it is in many cases unwisely dispensed.” In his last report to the Legislature the aggregate cost of the fourteen great institutions in operation, with a population of 6,621, is put at $6,898,304.52.