Part 12

But it may be objected that public sentiment in a democracy will not support high salaries even for the most important public services, that democracies notoriously remunerate their higher officials very much less adequately than monarchies. The time is ripe, however, for challenging this attitude. As long as government work is looked upon as a dull, soulless, and not extremely useful routine, popular opposition to high salaries is not only comprehensible but praiseworthy. Once convinced of the value of certain services, however (and there is plentiful opportunity to do this), it is doubtful if self-governing peoples will show themselves less intelligent than kings. Even now engineers directing great and unusual public undertakings are frequently paid larger salaries than high officers of government charged with the execution of ordinary functions. Recognition of the importance of the work of the specialist is much more common now than formerly. The development of science and large scale industry is daily enforcing this lesson. As regards the unwillingness of democracy to pay well, a change that has recently come over the policy of certain labour unions is worth noting. Instead of ordering strikes they have on occasion taken a lesson from the procedure of their employers, and resorted to the courts for the redress of grievances. And in doing so they have called in the very ablest lawyers they could find, paying the latter out of the funds of the union fees as large as they could have earned on the opposing side. A similar illustration is afforded by the policy of the Social-democratic party in Germany which for a considerable period has recognised and met the necessity of remunerating its leaders in editorial, parliamentary, and propagandist work at professional rates far higher than the average wages received by the party rank and file.[59] Demos may despise aristocracy of birth but he is perhaps not so incapable of comprehending the aristocracy of service as many of his critics suppose.

* * * * *

By the system of regulation, as we have seen, government is brought into close contact with business along many lines. But the state is also one of the largest sellers and buyers in the markets of the world, and as such has many other intimate points of contact with economic affairs. Like any individual or corporation under the same circumstances it is liable to be victimised by practices designed fundamentally to make it sell cheaply or buy dearly,—both to the advantage of corrupt outside interests. Franchise grabbing is perhaps the most magnificent single example of the difficulties the state encounters when it appears as a vendor. Popular ignorance of the real nature of such valuable rights has been responsible for enormous losses on this score. A city which for any reason had to dispose of a parcel of land would find itself safeguarded in some measure by the fact that a large number of its citizens were familiar with real estate values and methods. Knowledge of intangible property is very much less common. There has been a great deal of effective educational work along this line, however, and that community is indeed backward which at the present time does not understand perfectly that perpetual franchises without proper safeguards of public interests are fraudulent on their face. Administrative agencies such as were referred to in connection with business regulation, and particularly public service commissions, are doing extremely valuable work in cutting down the possibilities of franchise corruption. The grabbing of alleys, the seizure of water fronts, and the occupation of sidewalks are minor forms of the same sort of evil which can no longer be practised with the impunity characteristic of the good old free and easy days of popular ignorance and carelessness.

In disposing of its public domain, although here, of course, the price obtained was not the major consideration on the part of the government, notorious cases of corruption were of common occurrence. Recent developments, particularly in connection with timber, mineral, and oil lands, reveal the stiffer attitude which the public and the government are taking on this question. Time was also when deposits of public funds yielded little or no interest to cities and counties. At bottom such loan transactions were sales, _i.e._, the sale of the temporary use of public monies. Quite commonly treasurers were in the habit of considering themselves responsible for the return of capital sums only, and any interest received was regarded as a perquisite of office. The system had all the support of tradition and general usage; it was frequently practised with no effort at concealment and without protest on moral or business grounds. Nowadays its existence would be regarded as a sign of political barbarism, and would furnish opportunity for charges of corruption about which effective reform effort would speedily gather.

The element of selling is not of major importance in many services performed by the state which nevertheless require constant watching in order to prevent corrupt misuse. Efforts to use the mails improperly are continually being made by get-rich-quick schemes, swindlers, gamblers, and touts of all descriptions. Crop reports are furnished without charge, but extraordinary precautions are necessary to prevent them from leaking out.

Instances such as the foregoing also serve to illustrate the point that any extension of the functions of government results in an enlargement of the opportunities for political corruption. Government railways, for example, would afford venal public officials many crooked opportunities (as _e.g._, for false billing, charges, and discrimination) which do not now exist as direct menaces to public administrative integrity. Private management of railways, however, has not been so free from such evils as to be able to use this argument effectively against nationalisation. Municipalities selling water, gas, or electricity, are notoriously victimised on a large scale by citizens whose self-interest as consumers overcomes all thought of civic duty or common honesty.[60] There is one other closely related phenomenon connected with the extension of the economic functions of government which will perhaps not so readily be thought of as corrupt, and which yet deserves consideration from that point of view. Public service enterprises under government ownership and management are always exposed to what some writers stigmatise as “democratic finance,”—that is strong popular pressure to reduce rates. Cost of production and the general financial condition of a given city may make the reduction of the prices charged for water, electricity, or gas, frankly contrary to public policy. Yet the self-interest of the consumer suggests the use of his vote and political influence to compel such reductions. Of course his action is not consciously corrupt, but it has every other characteristic feature of this evil.

* * * * *

The state is a much larger buyer than seller, and manifold are the possibilities of malpractice in connection with its enormous purchases of land, materials, supplies, and labour. Yet nothing in our contemporary political life is more marvellous than the light-hearted indifference with which the public regards the voting and expenditure of sums running into the millions. We recall vaguely that the great constitutional issues of English history were fought out on fiscal grounds, but we find the budget of our own city a deadly bore. We rise in heated protest whenever the tax rate is advanced by a fraction of a mill, but we regard with indifference the new forms either of necessary expenditure or needless extravagance which make such increases inevitable. There is one general advantage which state buying has over state selling, however. A great many of the purchases of government are made in competitive markets where fair price rates are ascertainable with comparative ease. Even large public contracts such as for erecting public buildings or for road construction are usually resolvable into a number of comparatively simple processes and purchases. Of course there are exceptions, as for example government contracts with railroad companies for carrying mail. But as a rule the ordinary purchasing operations of the state are simpler and more easily comprehensible than such acts of sale as franchise grants,—to mention the one of most importance from the view point of possible corruption. It is precisely at this vulnerable point on the buying side of governmental operations that the New York Bureau of Municipal Research has struck home. With a skill that amounts to positive genius this voluntary agency has placed before the people the ruling market prices and the enormously higher prices actually paid by officials for public supplies. Taking the purchasing departments of our best organised private corporations as a model it has drawn practical plans for the installation of similar methods as part of our municipal machinery. Equipped with field glasses and mechanical registering devices its agents have kept tab upon the flaccid activities of labourers in the public service and have contrasted the long distance results thus obtained with the suddenly energised performances of the same men when they knew themselves to be under observation. It has co-operated quietly and effectively with all willing officials in improving the methods of work in their offices, in installing more logical accounting systems and better methods of recording work done; and it has fought effectively, with the penalty of discharge by the Governor in two cases, those officials who were not amenable to proper corrective influences. And finally the Bureau has attacked the city budget and has even succeeded in making that dry and formidable document the object of active and intelligent public interest. Yet the cost of the Bureau’s work has been out of all proportion small in comparison with the benefits obtained. “Less than $30,000 was spent in 1908 in securing for four million people the beginnings of a method of recording work done when done, and money spent when spent, which will henceforth make inefficiency harder than efficiency, and corruption more difficult than honesty.”[61]

It is extremely gratifying to note the widespread interest which this work is arousing. Philadelphia and Cincinnati have established bureaus under the supervision of the parent organisation, and other cities are earnestly considering similar action. There would seem to be ample opportunity for the employment of the same sort of agency in connection with our state governments, and possibly in certain fields of national administration. Altogether it is by far the most noteworthy recent effort to stamp out governmental inefficiency and corruption. Other efforts are being made to the same end, particularly where extravagance is concerned. In many cities business men’s clubs, improvement associations, and taxpayers’ leagues, are watching expenditure as it has never been watched before. Public officials have co-operated loyally in a number of cases. Occasional discoveries have been made of safeguards and powers in the law which had been long forgotten or unused. The progress of uniform bookkeeping is rapid and highly significant in this connection. Aided largely by the latter development census reports, particularly the special issues dealing with statistics of cities of over 30,000 inhabitants, are making it possible to compare municipalities on strictly quantitative lines as to the cost and efficiency of various services. Altogether we are developing a new financial alertness and intelligence that should materially cut down various forms of political inefficiency and corruption, particularly on the purchasing side of governmental operations. It is not too much to say that the methods by which these results are to be effected are either at hand or capable of being worked out on demand. The question now is simply one of funds and the training of specialists to do the work.

* * * * *

Efforts by the state to regulate or suppress vice and crime bring about reactions on the part of the interests affected not unlike those which follow from the attempt to regulate legitimate business.[62] The corrupt practices thus occasioned are among the commonest and most objectionable that society has to contend with. Very large money returns in the aggregate are obtainable by political organisations which protect vice. It is doubtful, however, whether such sources of income are ordinarily so productive financially as the various corrupt relationships between business and politics described above. On the other hand the alliance between politics and the underworld has the advantage, from an unmoral point of view, that it yields not only money but also strong support at the polls. And as some of the voters whose support is thus secured may be depended upon for work as repeaters, ballot-box staffers, and thugs, the net political power which they wield is much greater than their number alone would indicate. There is one other important difference between the corruption arising from the attempt to regulate legitimate business and that which arises from the regulation of vice. In the former case a “deal” can frequently be consummated between two principals, the leader of a centralised business interest on the one hand and the leader of a centralised political organisation on the other. Something of the secrecy and the binding personal obligation of a “gentleman’s agreement” are thus obtained. Of course to carry out the compact the political leader must control the action of his dependents in public office, but the latter, whatever they may suspect, know nothing definite about the agreement into which the boss has entered. The protection of vice cannot be managed by so small a number of conspirators. Compliance by the whole police force with orders from the “front” is necessary. Every patrolman knows what is going on when he is told that he must not molest dives, gambling hells, or brothels. Members of the force may or may not be used to collect protection money and pass it “higher up,” but since there are many establishments which must pay tribute the employment of a considerable corps of collectors is necessary. In any event the number of those who have knowledge amounting to legal evidence is likely to be much larger in the case of the protection of vice than in the case, for example, of a corrupt franchise grant. Exposure either by some disgruntled police officer or by some overtaxed purveyor of vice is likely to come at any moment.

When revelations of this kind are made the moral uprising which follows seldom lacks force. Cynics may sneer at such popular manifestations as paroxysms of virtue, but practical political leaders are not likely to underestimate the damage which they are capable of inflicting. Even if the machine emerges comparatively unharmed from such a period of attack the heads of some of the leaders are likely to fall before the popular fury. Remembering Fernando Wood’s caution about the necessity of “pandering a little to the moral element in the community,” farsighted bosses are therefore more and more inclined to limit their operations in the field of vice protection and to seek support from their relations with legitimate business interests. If this process is carried on further, as now seems likely, the general problem we are considering will be simplified by the reduction to a minimum of corruption by the vicious element, although, of course, we would still have on our hands the large question of corruption in the interests of otherwise legitimate business.

With all their mistakes and wasted energy moral uprisings will help this development materially. After a “spasm” things seldom fall back into the lowest depths of their former state. We need more frequent spasms, at least until we shall have learned to live continuously and steadily on a higher plane. The gravest evil of the present intermittent situation would seem to be that in our occasional fits of indignation we write requirements into the law which, considering the prevalence of minor vicious habits among large masses of the people, are impossible of execution. One of the lessons which we have learned in attempting to regulate business is that legislation of this sort must be supplemented by special administrative agencies if it is to have any effect whatever. Admirable child labour laws, for example, remain absolutely futile without labour commissioners and a force of inspectors created particularly to see them enforced. Yet in the regulation of vice we rush on heedlessly piling one new duty after another upon an already overburdened and underpaid police force. As a consequence its chiefs become habituated to the idea that they can exercise discretion as to what laws are to be enforced and what laws may with impunity be neglected. Usually the police decision of such questions is that crime must be dealt with vigilantly and severely, vice, on the other hand, with large tolerance. No better situation could be devised for the schemes of corruptionists. Moreover the latter are materially aided in their nefarious work by the high standards and the severe penalties which the moral element has written into the law. Using these as clubs the corrupt politician can extort much larger contributions than would otherwise be possible. There are only two ways in which this situation may be met. Either we must reduce our too ambitious programmes for the regulation of vice, or we must strengthen our police forces until they are adequate to meet the demands placed upon them.

In whatever way this question may be decided there is ample ground for demanding the application of the most thoroughgoing civil service reform rules to our police establishments. It is well known that the rank and file of our police forces despise the dirty work forced upon them by the political wretches “higher up.” No man capable of the heroic deeds which are commonplace in the annals of the police service rings the doors of bawdy houses and collects a tithe from the sorrowful wages of shame except under the compulsion of the sternest bread and butter necessity. Usually it is necessary to select the yellow dogs of the force for this particular devil’s work, and the promotion of such creatures for their pliancy is a stench in the nostrils of their honest comrades. If one doubts that this is the real spirit of the police force let him consider the character of the fire departments of nearly all of our cities. The men in the latter service are chosen from the same class, face dangers of the same magnitude, and receive wages of about the same amount as policemen. In the main they deserve and receive high praise for their efficiency and honesty. It is true that they are not exposed to the corrupt temptations which surround policemen, and also that their work is held up to exacting standards by business men and insurance companies. The fact remains that our police forces are constructed of the same human material as our fire fighting forces. It is difficult to avoid the conclusion that if we adapt our requirements in the regulation of vice to the capacities of our forces, (or _vice versa_); if we criticise and appreciate their work in the same way as we do the work of their sister department; if we place their appointment, tenure, and promotion, upon grounds of merit and utterly exclude the influence of the corrupt “higher-ups,” we will have gone a long ways toward drying up the most despicable of the sources of political corruption.

* * * * *

Certain of the moral aspects of tax dodging have been dealt with in an earlier connection.[63] Contrary as it may seem to the principle of economic interest there is a good deal of carelessness and stupidity in this field, and cases are occasionally found of property that has been over-assessed. On the other hand more or less deliberate dodging is indulged in very largely. So far as this practice deserves the stigma of corruption it is a stigma which rests to a very considerable extent upon the so-called class of “good citizens.” Certain residents of “swell suburbs” who daily thank God that their government is not so corrupt as that of the neighbouring city are among the worst offenders of this kind. As directors of corporations men of the same standing are sometimes responsible for monumental evasions. Of course what was said with regard to the reaction of business against state regulation holds good here also. There are plenty of legitimate methods of protesting against unjust or oppressive taxes,—before the courts, before legislatures, and by open propaganda designed to influence party organisations. But the furtive concealment or misrepresentation of taxable values is a matter of entirely different moral colour, and it is the latter practice that we now have to consider.

Tax dodging is so common and so well established that it has built up an exculpatory system of its own. Instead of bringing his conscience up to the standards set by the law the ordinary property owner inquires into the practice of his neighbours, and governs himself accordingly. Wherever business competition is involved the threat of possible bankruptcy practically forces him into this course. Yet withal our citizen is likely to be somewhat troubled in his mind about his conduct, at least until he learns how shamelessly John Smith who lives just a little way down the street has behaved. This information quite restores his equanimity, and at the next assessment he may outdo Smith himself. Thus the extra legal, if not frankly illegal, neighbourhood standard tends constantly to become lower. And not only taxpayers but tax officials themselves are affected by local feeling and fall into the habit of closing their eyes to certain kinds of property and expecting only a certain percentage of the valuation fixed by law to be returned.