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I - John Joseph Lalor, Cyclopaedia of Political Science, Political Economy, and of the Political History of the United States, vol. 2 East India Co. - Nullification [1881]Edition used:Cyclopaedia of Political Science, Political Economy, and of the Political History of the United States by the best American and European Authors, ed. John J. Lalor (New York: Maynard, Merrill, & Co., 1899). Vol 2 East India Co. - Nullification
Part of: Cyclopaedia of Political Science, Political Economy, and of the Political History of the United States, 3 vols.
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IIDAHOIDAHO, a territory of the United States, part of the Louisiana cession. (See ANNEXATIONS, I) It was originally a part of the territory of Oregon, was then transferred to the territory of Washington, and was organized as a separate territory, March 3, 1863. As first organized it covered 326,373 square miles; but, since then, the whole territory of Montana, and nearly the whole territory of Wyoming, have been taken from it. It now comprises 86,294 square miles, lying between Washington territory and Oregon on the west, Montana and Wyoming on the east, British Columbia on the north, and Utah and Nevada on the south. Its population in 1880 was 32,610. The capital is Boise City, and the governor John B. Neil. —The act of March 3, 1863, is in 12 Stat. at Large, 808. ALEXANDER JOHNSTON. ILLINOISILLINOIS, a state of the American Union, formed mainly from territory ceded by Virginia, March 1, 1784. The extreme northern part of the state formed part of the territory ceded to the United States by Massachusetts and Connecticut in 1785-6. From Indiana territory, comprising all of these cessions outside of the modern state of Ohio, the territory of Illinois was erected by act of Feb. 3, 1809, comprising the modern states of Illinois, Wisconsin and part of upper Michigan. (See TERRITORIES, ORDINANCE OF 1787, INDIANA) —April 18, 1818, an enabling act was passed by congress authorizing the formation of a state government by the inhabitants of that part of Illinois territory included within the following boundaries: "Beginning at the mouth of the Wabash river, thence up the same, and with the line of Indiana, to the northwest corner of said state; thence east, with the line of the same state, to the middle of Lake Michigan; thence north, along the middle of said lake, to north latitude forty-two degrees thirty minutes; thence west to the middle of the Mississippi river, and thence down, along the middle of that river, to the confluence with the Ohio river; and thence up the latter river, along its northwestern shore, to the beginning." —In accordance with the enabling act, a convention was held at Kaskaskia, Aug. 26, 1818, and adopted the first constitution of the state of Illinois. It gave the right of suffrage to all white males over twenty-one years old on six months residence; fixed the governor's term of office at four years, but prohibited his immediate re-election; prohibited slavery; and fixed the seat of government at Kaskaskia (since changed to Springfield by the legislature). Under this constitution the state was admitted by joint resolution, Dec. 3, 1818. A more symmetrical constitution was adopted in convention at Springfield, Aug. 31, 1848, and ratified by popular vote March 5, 1849. It prolonged the residence necessary for electors to one year, and prohibited the immigration of free negroes into the state or the bringing of slaves into the state to be emancipated. The present constitution was adopted in convention at Springfield, May 13, 1870, and ratified by popular vote, July 2, 1870 Its leading objects were to limit the powers of the legislature and to establish the powers of the state over railroads and other corporations. It forbade special legislation by the legislature in a number of specified cases, the contraction of indebtedness by municipal corporations to are amount in excess of 5 per cent. of their taxable valuation, municipal subscriptions or loans of credit to private corporations, the bringing of suits against the state in its own courts, or the consolidation of parallel or competing railroads: and it declared all railroads hereafter constructed to be public highways, authorized the passage of laws limiting railroad rates, and placed warehouses under state control. It also provided for minority representation as follows: "In all elections of representatives, each qualified voter may east as many votes for one candidate as there are representatives [three in each senatorial district] to be elected, or may distribute the same or equal parts thereof, among the candidates, as he shall see fit; and the candidates highest in votes shall be declared elected" (See CONSTITUTIONS, STATE.) —The political history of Illinois was for a long time very much influenced by its southern vote. So late as 1850, 16 per cent. of the population of the state was born in southern states, and over half of this fraction was from Kentucky and Tennessee. Geographical names still show the influence of this immigration, particularly in the southern part of the state, commonly called "Egypt"; but soon after 1850 the current of immigration began to come more rapidly from the east. In 1870 this proportion had decreased to 9 per cent. The general rule, however, has been that the southern part of the state has been democratic, and the northern part anti-democratic. —In national politics the electoral votes of Illinois were invariably democratic until 1860, and have been as invariably republican including and since that year. (See DEMOCRATIC PARTY, V.) In 1848 and 1856 the democratic electoral ticket was successful only by a plurality; in all other years the successful ticket has had a clear majority. —The congressional elections have followed the course of the presidential elections quite closely. Until 1834 they were regularly democratic. After that year two of the three districts were usually democratic, and one (the northern district) whig by a small majority. The census of 1840 gave the state seven representatives; until 1852, six of these were democratic and one whig. The whig district lay along the Sangamon river. It was represented in 1847-9 by Abraham Lincoln, in 1849-51 by E. D. Baker, and in 1851-5 by Richard Yates. Douglas' district lay west and southwest of it. In 1852, under the new apportionment, the first break was made in the democratic districts by the increase of the free-soil vote. Of the nine representatives, four were so-called northern whigs, afterward anti-Nebraska men and republicans. Their districts embraced the old Sangamon district and thence all the northern and northeastern part of the state, except the Chicago district, which was narrowly carried by John Wentworth, then a democrat. In 1854 the republicans really gained a district farther south by the election of Lyman Trumbull, an anti-Nebraska democrat. The legislature, which was anti-Nebraska, sent Trumbull, who was now a republican, to the senate, the first anti-democratic senator from Illinois. The southern part of the state still remained democratic, and until 1864 congressional elections regularly resulted in heavy democratic majorities in the south, heavy republican majorities in the north, and very small democratic majorities in the centre of the state. In 1858 the election of the state legislature, which was to choose a senator to succeed Douglas, assumed a national importance. Douglas and Lincoln spoke throughout the state in joint debate, and, though Lincoln was beaten, the ability, clearness and simplicity of his speeches gave him a national prominence and the republican nomination for the presidency in 1860. In that year Illinois was called upon to choose between two of her own citizens, Lincoln and Douglas, for the presidency; her electoral vote, after a close contest, was given to Lincoln, but the congressional districts remained as before. The census of 1860 gave the state fourteen representatives; of these the republicans elected those from the five northern districts in 1862, and the democrats the rest, including the congressman at large. In 1864 the republicans carried ten districts and elected the congressman at large. This result was largely due to the accession of war democrats, several of whom carried southern districts hitherto democratic. The congressional proportions then remained almost unchanged until 1874, when eight of the nineteen districts became democratic, seven republican and four independent, two of the democratic districts being in the north. In 1878 the congressional proportion became thirteen republican representatives to six democratic, as it has since remained (to 1883), the democratic districts being still in the southern part of the state. —In state politics every governor until 1857 was a democrat, and every governor since that year has been a republican. Until 1854, when an anti-Nebraska legislature was chosen, the legislatures were democratic; since that year they have been quite steadily republican, and have elected republican United States senators with three exceptions. In 1858, as above stated, Douglas was elected to the senate. In 1863 Wm. A. Richardson, a democrat, was chosen to serve out Douglas' unexpired term. In 1877 David Davis, an independent, was sent to the senate by a combination of democrats and independents. The system of minority representation in the lower house of the legislature, above referred to, went into operation in 1872, and worked so exactly as to give each party within four-tenths of one per cent. of its legitimate representation, according to its vote for governor. Since 1872 the only important movement in strictly state politics has related to the attempts to control and limit the rates of the railroads of the state, in accordance with the provision of the constitution of 1870 under that head. Several state judges gave decisions unfavorable to the constitutionality of the railroad laws, and efforts were successfully made to prevent the re-election of the offending judges. The case of Chief Justice C. B. Lawrence was the most notable. —Three of the most distinguished leaders in American politics, Abraham Lincoln, Stephen A. Douglas and Ulysses S. Grant, have been citizens of Illinois. (See those names.) The names of others, prominent in state and national politics, will be found in the list of governors of the state. In addition to these, brief reference should be made to Edward D. Baker, whig representative in 1845-6, and 1849-51, senator from Oregon 1860-61, killed at Ball's Bluff; Sidney Breese, democratic senator, 1843-9, state circuit judge 1855, and chief justice 1873; Orville H. Browning, republican United States senator 1861-3, afterward secretary of the interior (see ADMINISTRATIONS); John F. Farnsworth, republican representative 1857-61 and 1863-73; Ebon C. Ingersoll, republican representative 1864-71; Robert J. Ingersoll, noted as a republican orator; John A. Logan, democratic representative 1859-61, republican congressman at large 1867-71, and United States senator 1871-7 and 1879-85; John A. McClernand, democratic representative 1843-51 and 1859-61; James Shields, democratic United States senator 1849-55; Lyman Trumbull, republican United States senator 1855-73; Elihu B. Washburne, whig and republican representative 1853-69, and minister to France 1869-77; and John Wentworth, democratic representative 1843-51 and 1853-5, and republican representative 1865-7. —The name of the state was given from that of its principal river, the Illinois, which is said to have been named from the Illini, an Indian tribe formerly living near it. The popular name for the state is the "prairie state," and for the people "suckers." The latter term, of doubtful derivation, is accepted without demur by the people of Illinois. —GOVERNORS: Shadrach Bond (1818-22), Edward Coles (1822-6), Ninian Edwards (1826-30), John Reynolds (1830-34), Joseph Duncan (1834-8), Thomas Carlin (1838-42), Thomas Ford (1842-6), Augustus C. French (1846-53), Joel A. Matteson (1853-7), William H. Bissell (1857-61), Richard Yates (1861-5), Richard J. Oglesby (1865-9), John M. Palmer (1869-73), Richard J. Oglesby (1873, resigned), John L. Beveridge (1873-7), Shelby M. Cullom (1877-85). —See Poore's Federal and State Constitutions, and Political Register; Reynolds' Pioneer History of Illinois (to 1818); Birkbeck's Letters from Illinois (1818); Ford's History of Putnam [and other] Counties (1860); Beck's Gazetteer of Illinois (1823); Edwards' History of Illinois (to 1833); Mitchell's Illinois in 1837; Brown's History of Illinois (to 1844); Ford's History of Illinois (to 1847); Carpenter's History of Illinois (to 1854); Gerhard's Illinois as it is (1857): Eddy's Patriotism of Illinois; Wright's Chicago (1870); Davidson and Stuvé's History of Illinois (to 1873); Matson's French and Indians of the Illinois River (1875); the act of Feb. 3, 1809, is in 2 Stat. at Large, 514; the act of April 18, and the resolution of Dec. 3, 1818, are in 3 Stat. at Large, 428, 536; Porter's West in 1880, 157. ALEXANDER JOHNSTON. IMMATERIAL PRODUCTS.IMMATERIAL PRODUCTS. To "produce," in the economic sense of the word, is not to create matter, which is beyond human power, but a valid utility, that is to say, one that may be exchanged for other utilities. Now utility in itself has nothing material in it; it is a quality, a property which only exists by its relation to our wants. From this point of view all products without exception are immaterial; but it has been thought desirable to distinguish, among the utilities produced, those directly connected with man, and these have been called "immaterial products." —Adam Smith, Malthus, and other economists, did not admit this last class of products. Smith, while recognizing the utility and even the necessity of the services of functionaries, magistrates, the army, etc., did not admit that these services were productive. "Their service," he says, "how honorable, how useful or how necessary soever, produces nothing for which an equal quantity of service can afterward be procured. The protection, security and defense of the commonwealth, the effect of their labor this year, will not purchase its protection, security and defense for the year to come. In the same class must be ranked, some both of the gravest and most important, and some of the most frivolous professions: churchmen, lawyers, physicians, men of letters of all kinds; players, buffoons, musicians, opera singers, opera dancers, etc. The labor of the meanest of these has a certain value, regulated by the very same principles which regulate that of every other sort of labor; and the labor of the noblest and most useful of these professions produces nothing which could afterward purchase or cause an equal quantity of labor to be performed. Like the declamation of the actor, the harangue of the orator, or the tune of the musician, the work of all of them perishes at the very instant of its production." —Malthus thought that "from the moment the line of demarcation between material and immaterial objects is taken away, the explanation of the causes which determine the wealth of nations and every means of appraising it become extremely difficult, if not impossible." —J. B. Say thus sums up the characteristics which seem to him to distinguish the products in question: "An immaterial product," he says, "is any sort of utility which is unconnected with any material body, and which consequently is consumed as soon as produced. Certain immaterial products, although consumed as soon as produced, are susceptible of accumulation, and consequently of forming capital when their consumed value is met with and fixed on a durable basis (fonds). It is thus that the oral lesson of a teacher of the art of healing is reproduced in the industrial faculties of those of his pupils who have profited by it. This value is then attached to a durable subject, the pupil." M. Dunoyer seems to us to have considerably elucidated and perfected the idea of immaterial products; he does not admit that they are consumed as soon as produced, and he thinks that this statement has only been made on account of a want of distinction between work and its results. M. Dunoyer has himself recalled in his article headed "Production," the theory evolved by him on this subject in his great work on "Freedom of Labor." His observations seem to us completely justified; but great care must be taken, in considerations relative to the class of products which we are dealing with, never to forget the distinction between labor and its results, a point on which in some respects, perhaps, M. Dunoyer has not sufficiently insisted. It is certain that all useful labor is productive, and that everything which can satisfy our various wants or assist in perfecting our intellectual or moral nature is useful; but the labor performed on man or his faculties, which, to use M. Dunoyer's expression, has man for its subject, is far from being always useful and productive. Too often, on the contrary, this labor is not only useless and unproductive, but to the last degree hurtful and destructive. It is then absolutely necessary, before deciding if labor having man for its subject is or is not productive, to examine its object and its results. —An armed force, used exclusively, according to the need there may be of it, in preserving national independence, in assuring internal tranquillity and respect of persons and property, performs an unquestionably productive labor; for, on the one hand, it represses collective or individual violence with all its accompanying evils; while, on the other hand, it gives to all that feeling of security which is indispensable to activity and productiveness in labor. But an army which should become the tool of the ambition, pride or vanity of certain personages; which should serve to maintain at home an oppressive and grasping rule, and to carry abroad war and its devastations, would no longer be a productive force, but a scourge. —Magistrates who conscientiously fulfill their duty, who administer with rigid impartiality the laws of justice as the general condition of enlightenment has established them, are eminently producers; for they contribute to insure to the nation security and at the same time to perfect the morality of the people. But a magistracy which should make itself the accomplice of a destructive and tyrannical power, would by so doing only contribute to produce evils of every description. —A civil administration which applied itself to attending to, by efficacious means, but as simple and as little costly as possible, collective interests of such a nature that they could not be left with advantage to the care of individual activity; to collecting the taxes which the public service might render indispensable; to protecting without harassing the regular growth of general activity; to preventing dangers or hurtful acts in the few cases where the evil resulting from preventive measures would not equal or exceed that which the action is taken to prevent, would fulfill a mission whose usefulness and consequently whose productiveness could not be contested. But an administration, which, instead of confining its efforts to protecting, in the best way possible, the free and legitimate application of general activity, should pretend to direct and regulate it on all points; which supposed itself authorized in many cases to take from some to give to others; which, in order to extend its action everywhere, should complicate more and more the public service, and should without stay or limit increase the personnel of the administration, would only succeed by such a course in trammeling all useful works, in producing a forced and unjust distribution of part of the values produced, a more and more energetic and general desire for public employment, a progressive increase in the parasite population, the weakening and discouragement of productive activity in proportion to the development given to destructive activity, and finally, the insecurity and disorders inseparable from all these causes of disturbance. Such an administration, taken as a whole, would little merit to be considered productive of utility. —Ministers of a religion, who, to propagate their faith or their beliefs, used no other arm than persuasion, the only one for that matter of any avail; who made themselves the teachers of ethics and the consolers of their adherents; who, by the help of religious sentiments, strove to elevate and purify more and more their intelligence and their habits, to develop and enlighten their better feelings, to resist and diminish their evil and mischievous propensities—in a word, to direct their desires, their tendencies and their activity into the path most beneficial for all, would undoubtedly be the most valuable of all producers, the most worthy of respect and veneration; for they would contribute more than all others to the perfecting of human life, to raising men to the highest level it is given them to attain. But a clergy who, to establish their influence, counted less on persuasion than on authority; who lacked the necessary enlightenment to enable them to act on the affective faculties of their followers in such a way as to improve them and wisely guide their natural tendencies; who, besides, ignored the importance of this part of their mission and devoted themselves mainly to obtaining a submission, a passive obedience, voluntary or forced, to all the tenets or forms prescribed by them, and should be contented with such a result as sufficient to assure their power and serve their temporal interests—could a clergy, we ask, who employed such means for such an object, be fitly classed among producers? —The same may be said about the labor of the teacher, the professor, the man of letters, or the artist. We might ask if secondary education, as it exists in France for example, is in accordance with the needs or the real interests of the population; if the study and praise bestowed on the manners, the institutions, the opinions and the actions of the ancient peoples of Greece and Rome, are well fitted to make honorable and useful citizens; if the ideas drawn from such teaching are really utilities; if there might not be something better to teach, etc. We might ask if all authors, poets and artists have a good effect in improving the mind, elevating the soul, or refining the taste; but the reader can easily supply for himself what is here omitted. What has been said seems to us sufficient to, establish our statement that all labor which has man as its object is not productive. And that to distinguish such as is from such as is not, it is necessary to examine its results. —It is of importance, however, to explain that utility "can not be estimated in political economy as it is in ethics, and that we must recognize here as useful everything which has an exchangeable value. There must in consequence be admitted as veritable products, all the results of the labors of the author, the artist, the doctor, etc., to which the public attaches a price freely agreed upon, even when to the eyes of reason some of these results are worth nothing or less than nothing, but it is quite otherwise with the labor whose wages are not freely determined, and the results of which men are forced to accept, whatever they may be, such as those regulated by authority; the effects of this labor have no price current which the economist is obliged to accept, whether reasonable or not, and their appraisement is entirely a matter for the decision of enlightened reason. A. CLÉMENT. IMMIGRATION.IMMIGRATION. (See EMIGRATION.) IMPEACHMENTSIMPEACHMENTS (IN U. S. HISTORY). The constitution only provides that the house of representatives shall have the sole power of impeachment of the president, vice-president, and "all civil officers of the United States"; that the senate shall have the sole power to try impeachments; that judgment, to be given by two-thirds of the senators present, shall only involve removal from, and disqualification to hold, office under the United States; that a person convicted shall not be pardoned by the president, and shall still be liable to indictment and punishment at law. When the president of the United States is tried, the chief justice presides over the senate. —The constitution has not attempted to ascertain and classify the offenses which are impeachable. It has only stated (Art. I., §3, ¶7) that "the party convicted shall, nevertheless, be liable and subject to indictment, trial, judgment, and punishment according to law;" and (Art. II., § 4) that "the president, vice-president, and all civil officers of the United States shall be removed from office on impeachment for and conviction of treason, bribery, or other high crimes and misdemeanors." From this omission of specification two antagonistic opinions have arisen. 1. It is held that the power of impeachment extends only to such offenders as may afterward be indicted and punished according to law: that is, that the house can only impeach, and the senate remove, for indictable offenses. This would make the power of impeachment defined and circumscribed. 2. On the contrary, it is held that the phrase "high crimes and misdemeanors" was intentionally left undefined in order that the power of impeachment might embrace not only indictable offenses, but also that wider and vaguer class of political offenses which the ordinary courts of law can not reach. This would make the power of impeachment under the American constitution closely similar to that which has been exercised under the British constitution. It would then include all misdemeanors which might seem to a majority of the house, and to two-thirds of the senate, so heinous or so disgraceful as to make the offender's exclusion from office necessary to the well-being of the country; and the punitive effect of the popular vote would be relied upon to deter a dominant party from abusing the power for selfish ends. The best results have probably been reached by leaving the question open to individual judgment. —Many minor questions are still unsettled, and will probably long remain so. 1. It can not be considered settled that an office-holder may escape impeachment for acts done while in office, by resignation, expulsion, or the close of his term of office. The point was made, but not decided, in Blount's case (see I.), and although it prevented a two-thirds majority in Belknap's case (see VII.), the power of impeachment was there maintained by a very decided majority of the senators, including nearly all the ablest lawyers of the senate. On the one hand is the provision that only "civil officers" are liable to impeachment; and the conjunction of "removal from office and disqualification" would seem to imply that the removal was the first essential to punishment, and that disqualification could not be inflicted where removal had for any reason become impossible. On the other hand is the obvious objection, on the score of public policy, to allowing a suddenly discovered criminal in office to escape impeachment by an aptly timed resignation. 2. Blount's case has apparently settled that senators and representatives are not impeachable; but the decision in that case was made against strong opposition at the time, and has been repeatedly objected to since. In favor of the decision is the language of the constitution; it limits the power of impeachment to "the president, vice-president, and all civil officers," but in other places mentions members of congress and "civil officers" in distinct categories. Against it is the decision by the senate, in January, 1864, that an oath prescribed for "civil officers, "by the act of July 2, 1862, must be taken by senators also. 3. The power of the senate to arrest the accused, or "sequester" or suspend him from office, pending judgment on the impeachment, is very doubtful, and is defended mainly by parallel with the practice in English impeachments. The language of some of the framers of the constitution and their contemporaries, however, goes to show that they considered the power of suspension to be in the senate; and Senator Sumner, on Johnson's trial, argued that the selection of the chief justice to preside over the trial of a president was not because the vice-president was supposed to be an interested party, but because he was presumed to be engaged in performing the duties of the president during the necessary suspension of the latter from office. The power of arrest was exercised by the senate, though under peculiar circumstances, in Blount's case. It is, however, usually a power not necessary to secure attendance, since the only judgment in case of conviction is the stigma of inability to bold office, and punishment does not extend to death or deprivation of property; nor, in any event, is the attendance of the accused necessary; since he may be tried and condemned in his absence, as in Blount's, Pickering's and Humphreys' cases. (See I., II., V.) 4 Can an unjust conviction on impeachment ever be reversed by a subsequent congress? This is a question which has never been raised, and the now acknowledged equity of the whole line of senatorial decisions in impeachment cases gives strong reason for hope that it will never be necessary to raise it. —The impeachment cases in our national history are given below. It has not been considered necessary to go into impeachments by state legislatures, but reference is made among the authorities to several important cases of this kind—I. WILLIAM BLOUNT. July 3, 1797, the president sent to congress a number of papers on the relations of the United States and Spain. Among them was a letter from United States Senator Blount, of Tennessee, to an Indian agent among the Cherokees, from which it appeared that Blount was engaged in a conspiracy to transfer New Orleans and the neighboring territory from Spain to Great Britain, by means of a British fleet and a land force to be furnished by Blount. On receipt of notice that the house intended to impeach him, the senate at first put him under $50,000 bonds to appear for trial, but afterward expelled him, July 9. His sureties then surrendered him to the senate, but he was again released on decreased bail. The whole of the next session, Nov. 13, 1797—July 16, 1798, hardly sufficed for the preparation of the five articles of impeachment, which were finally brought to trial, Dec. 24, 1798. Blount, who had in the meantime been elected to the senate of his state, did not appear, but his counsel plead, 1, that, as senator, he was not a "civil officer" liable to impeachment, and, 2, that, since his expulsion he was no longer a senator. The senate sustained the first plea, and Blount was acquitted for want of jurisdiction. —II. JOHN PICKERING. March 3, 1803, the house impeached Judge Pickering, of the federal district court for the district of New Hampshire. The four articles against him charged him with decisions contrary to law, and with drunkenness and profanity on the bench, and were tried by the senate at once. Judge Pickering did not appear, but his son attempted to prove his father's insanity. The managers on the part of the house, in reply, maintained that the insanity was a consequence of his habitual drunkenness. He was convicted March 12, by a party vote, the federalists voting in the negative, and removed; the further disqualification to hold office was not inflicted. —III. SAMUEL CHASE. One of the ablest of the federal justices of the supreme court was Chase, of Maryland, appointed Jan. 27, 1796. The practice of adding disquisitions on current politics to charges to grand juries was then common with American judges, as it had long been in Great Britain; and after the downfall of the federal party in 1801 Chase kept up the practice with a bitterness and ability equally displeasing to the dominant party. In the house, Jan. 5, 1804, Randolph obtained a committee to investigate Chase's official conduct; and on their report Chase was impeached, Nov. 30, 1804, and Randolph was appointed chief manager. The articles of impeachment were presented to the senate, Dec. 7, 1804, and the trial was begun Jan. 2, 1805. There were eight articles. 1, for arbitrary and unjust conduct in the trial of John Fries for high treason, in April, 1800, in refusing to allow the prisoner's counsel to argue various law points, and in announcing his opinion as already formed, so that the prisoner's counsel threw up the case; 2. for refusing to excuse a juror who had prejudged the guilt of J. T. Callender, in a trial under the sedition law, in May, 1800, at Richmond; 3, for refusing to allow one of Callender's witnesses to testify; 4, for interrupting and annoying Callender's counsel, so that they abandoned his case; 5, for arresting, instead of summoning, Callender in a case not capital; 6, for refusing to allow Callender a postponement of his trial; 7, for urging an unwilling Delaware grand jury to find indictments under the sedition law; and 8, for "highly indecent and extra-judicial" reflections upon the government of the United States before a Maryland grand jury. The eighth article covered his real offense; the others were the fruits of the committee's zealous research into his past official life. —The defense disproved very much of the matter alleged, and as to the remainder Chase's counsel argued successfully that his conduct had been "rather a violation of the principles of politeness than of the principles of law; rather the want of decorum than the commission of a high crime and misdemeanor." On the 3d, 4th and 8th articles Chase was pronounced guilty by a small majority, the largest, 19 to 15, on the 8th; on the other articles a majority found him not guilty; and as a two-thirds majority was not given for any article, he was pronounced not guilty on all, March 1, 1805. The result of the trial led to some efforts on the part of the democratic leaders to change the tenure of federal judges. (See JUDICIARY, VII.) Judge Chase held his seat on the bench until his death, June 19, 1811. —IV. JAMES H. PECK. Dec. 13, 1830, Judge Peck, of the federal district court for the district of Missouri, was tried on an impeachment passed by the house at the previous session. The article against him alleged arbitrary conduct, in 1827, in punishing for contempt of court an attorney who had published a criticism of Judge Peck's opinion in a land case. In this case the vote of the senate was 21 guilty, 24 not guilty, and Judge Peck was acquitted—V. WEST H. HUMPHREYS. At the outbreak of the rebellion the district judges of the federal courts in the seceding states, and one of the justices of the supreme court (James A. Campbell, of Alabama), resigned. Justices Catron, of Tennessee, and Wayne, of Georgia, notwithstanding the secession of their states, retained their positions as justices of the supreme court, and their loyalty was never questioned. On the other hand, Judge Humphreys, of the federal district court of Tennessee, while actively engaged in the rebellion, had not resigned, and impeachment became necessary in order to vacate his position. Recourse was had to a secession speech made by him in Nashville, Dec. 29, 1860, and this, and his acceptance of the office of confederate judge, were made the basis of seven articles of impeachment by the house, on which he was convicted by a unanimous vote of the senate, June 26, 1862—VI. ANDREW JOHNSON. Jan. 7, 1867, Jas. M. Ashley, of Ohio, submitted a resolution in the house directing the judiciary committee to investigate his charge that President Johnson had corruptly used the appointing power, the pardoning power, the veto power, and the public property, and had corruptly interfered in elections. The house adopted the resolution, and five of the nine members of the committee reported, Nov. 25, 1867, in favor of impeachment. Their resolution to that effect was lost, Dec. 7, by a vote of 56 to 109. —In March, 1867, congress had enacted (see TENURE OF OFFICE) that civil officers "holding or hereafter to be appointed" to any office by confirmation of the senate, should retain office until a successor should be confirmed by the senate, except that cabinet officers, unless removed by consent of the senate, should "hold their offices for and during the term of the president by whom they may have been appointed, and for one month thereafter." At the same time congress had practically taken the command of the army from the president (see RECONSTRUCTION), and had made the secretary of war really independent of, as well as irremovable by, the executive. —All the cabinet, except the secretary of war, E. M. Stanton, seem to have been in sympathy with the president in March, but the estrangement between Stanton and Johnson increased so rapidly that the president suspended the secretary of war, Aug. 12, 1867, as he was allowed to do, by the tenure of office act, while the senate was not in session, and appointed the general of the army, U. S. Grant, secretary ad interim. Within twenty days after the senate should meet, the president was required by the tenure of office act to lay before the senate his reasons for any suspension during its intermission; in Stanton's case he did so, and the senate, Jan. 13, 1868, by a party vote of 35 to 6, non-concurred in Stanton's suspension. Gen. Grant at once notified the president that his functions as secretary ad interim had ceased. Secretary Stanton immediately resumed his place, and kept it throughout the subsequent proceedings until May 26, when he finally relinquished it. —The suspension of Stanton was a mistake, in so far as it recognized the mode of procedure laid down in the tenure of office act, since the vital point in Johnson's case was the applicability of that act to Secretary Stanton. The president, indeed, asserted that Gen. Grant had promised to hold the office in spite of the senate's non-concurrence, and thus force Secretary Stanton, by an appeal to the courts, to test the constitutionality of the act; and the assertion was sustained by all the cabinet officers except Stanton, but was denied by Gen. Grant. The plan, which had been baulked by Grant's surrender of the office to Stanton in January, was resumed in February with a more reliable instrument, and apparently with better legal advice. Feb. 13, the president desired Gen. Grant to appoint Gen. L. Thomas adjutant general, and the appointment was made. Feb. 21, the president removed Stanton, as if the tenure of office act did not apply to his case, and appointed Thomas secretary of war ad interim, under the law of Feb. 13, 1795, which allowed the appointment of such officers, in emergencies, for not more than six months, without confirmation by the senate. Stanton refused to vacate the office, and notified the speaker of the house of his attempted removal. Feb. 24, the house adopted a resolution of impeachment by a vote of 126 to 42, and on the following day a committee impeached the president at the bar of the senate. By tacit consent, all attempts to obtain possession of the war department were dropped to abide the result of the impeachment. —The house managers of the impeachment were John A. Bingham of Ohio, Geo. S. Boutwell and Benj. F. Butler of Massachusetts, Jas. F. Wilson of Iowa, Thomas Williams and Thaddeus Stevens of Pennsylvania, and John A. Logan of Illinois. —The president's counsel were Henry Stanbery and W. S. Groesbeck of Ohio, Wm. M. Evarts of New York, Thos. A. R. Nelson of Tennessee, and Benj. R. Curtis of Massachusetts. March 4, the managers presented eleven articles, impeaching the president of the following high crimes and misdemeanors: 1. The issuance of an order removing Stanton, with intent to violate the tenure of office act, after the senate bad refused to concur in his suspension; 2, the issuance of an order to Thomas to act as secretary of war ad interim while the senate was in session, no "vacancy existing" in the war department, with intent to violate the tenure of office act and the constitution, and 3, without authority of law; 4, conspiracy with Thomas and other persons with intent, by intimidation and threats, to prevent Stanton from acting as secretary; 5, to prevent the execution of the tenure of office act; 6, to seize the war department's property by force, and, 7, to violate the tenure of office act; 8, the appointment of Thomas with intent to control unlawfully the disbursement of the war department's moneys; 9, an attempt to induce Gen. Emory, commanding the department of Washington, to disobey the act above referred to, regulating the issuance of orders to the army; 10, the use, in regard to congress, of "utterances, declarations, threats and harangues, highly censurable in any, and peculiarly indecent and unbecoming in the chief magistrate of the United States, by means whereof said Andrew Johnson has brought the high office of president into contempt, ridicule and disgrace, to the great scandal of all good citizens"; and 11, his public declaration that the 39th congress was no constitutional congress, but a congress of part of the states, "thereby denying and intending to deny that its legislation was obligatory upon him, and that it had any power to propose amendments to the constitution," and designing to prevent the execution of the tenure of office act, the act for the government of the army, and the reconstruction acts. The last two articles were additions to the original nine articles, based upon certain speeches made by the president during a tour to St. Louis in August and September, 1866. —The answer of the president, through his counsel, may be reduced to four heads. 1. As to articles 1-3, he averred that Stanton, having been appointed by President Lincoln, Jan. 15, 1862, having served out "the term of the president by whom he had been appointed," and never having been reappointed, was not embraced in the terms or the intention of the tenure of office act, of March 2, 1867; that Stanton had taken office and kept it "during the pleasure of the president," according to the terms of the act of Aug. 7, 1789, organizing the war department, and according to the practice of all presidents and congresses down to March, 1867; that Stanton's removal was not in violation of the tenure of office act; and that the appointment of Thomas was to fill an existing vacancy. 2. As to articles 4-7, he denied any conspiracy, any intimidation, or any authority to use force given by him to Thomas, and asserted that the only connection between him and Thomas was an order from him as superior and obedience to it by Thomas. 3. He denied the truth of article 8. 4. As to articles 9-11, he claimed the right of freedom of opinion and of freedom of speech; he asserted that his declarations to Emory and to public meetings were identical with his messages to congress; and called attention to the fact that the allegations in these articles did not "touch or relate to any official act or doing" of the president. —The trial, beginning with the organization of the senate as a court to try the impeachment, March 5, ended March 26. Excluding the twenty senators from southern states not yet admitted, the total number of senators was fifty-four; the two-thirds vote, needed for conviction, would, therefore, have been 36 to 18. There were twelve democratic senators, all of whom were quite certain to vote not guilty, so that it was necessary that at least seven republican senators should vote against conviction on all the articles in order to secure an acquittal. Before a vote was reached it was very apparent that there were but three articles (2, 3 and 11) on which a conviction was possible. On the "conspiracy" articles (4-7), and the "Emory" article (9), the proof had failed to convince many republican senators. The "Butler" article (10) consisted of unofficial utterances of the president. On the "Stanton" articles (1, 8) several republican senators asserted that the tenure of office act was admitted at the time of its passage not to apply to President Lincoln's secretaries, Sherman, of Ohio, one of the senate conferees on the act, says in his opinion, "Can I, who still believe it to be the true and legal interpretation of those words, can I pronounce the president guilty of crime, and by that vote aid to remove him from his high office, for doing what I declared and still believe he had a legal right to do? God forbid." May 16, by order of the senate, the vote was taken on the eleventh article first, and was found to be 35 for conviction and 19 for acquittal, seven republican senators voting in the minority. The senate adjourned at once until May 26, when a vote was taken on the second and third articles, with exactly the same result as on the eleventh. The senate then adjourned sine die, without voting upon the other articles, and the chief justice directed a verdict of acquittal to be entered upon the record. —The strength of the eleventh article lay in its charge that the president had not faithfully executed the tenure of office act or the reconstruction acts, his declarations that congress was "not a congress" being apparently intended to show his mala fides. Its weakness lay in its vagueness, and in the fact that it charged the president with "designing and contriving" means to avoid the execution of the law, rather than with any overt acts. As to this article, then, the difference of opinion went mainly to the meaning of the language. The second and third articles, particularly the former, seem to have been lost because of their complication with Stanton's removal, and their statement that "no vacancy existed" when Thomas was appointed. If Stanton's removal were legal, the tenure of office act would then seem to apply to his office for the first time after he had been removed; and the absolute prohibition, in the second section of the act, of ad interim appointments, except in cases of suspension, would seem to hit the case of Thomas appointment exactly, though even then there would have been a fair question whether the appointment were a high crime and misdemeanor. Those of the seven acquitting republican senators who filed opinions seem to have voted not guilty on these articles because of the "no vacancy" clause, and because a vote for conviction would have stultified their opinions on the first and eighth articles (Stanton's removal); but, even without the objectionable clause, it is extremely probable that they would still have voted not guilty on the general ground of want of evil intent in the president's action. The only conclusion to be drawn from the conduct of the whole case is that the house was too hasty in impeaching; if it had waited patiently for some overt act to complete the eleventh article, that article would have been impregnable, and it is difficult to see how conviction could have been avoided honestly. —VII. WILLIAM W. BELKNAP. In February and March, 1876, the house committee on expenditures in the war department, discovered that Secretary Belknap, of that department, had for six years been receiving money for the appointment and retention in office of the post-trader at Fort Sill, Indian Territory. The total amount received was about $24,450. The house voted unanimously to impeach him, March 2, 1876, but a few hours before the impeachment resolution was passed, Belknap resigned, and his resignation was accepted by President Grant. April 4, the managers of the impeachment on the part of the house appeared at the bar of the senate, and exhibited five articles of impeachment, covering the various receipts of money charged against Belknap. In his reply the defendant claimed to be a private citizen of Iowa, and denied the power of the house to impeach any one who, by resignation or otherwise, had ceased to be a "civil officer of the United States." May 4-29, the question whether Belknap was, under all the circumstances, amenable to trial by impeachment was argued and decided in the affirmative by a vote of 37 to 29; but the vote proved the hopelessness of conviction, since the minority was too large to allow a two-thirds vote of guilty. The evidence and argument on both sides continued from July 6 until August 1, when the vote stood 36 guilty to 25 not guilty on the second, third and fourth articles, 35 to 25 on the first, and 37 to 25 on the fifth article. The majority for conviction not being two-thirds, a verdict of acquittal was entered. The vote of the minority was given on the ground of want of jurisdiction. (See TENURE OF OFFICE, RECONSTRUCTION) —See, in general, 2 Woodeson's Lectures, 602; 2 Bancroft's History of the Constitution, 193; Tucker's Blackstone, App. 335; The Federalist, lxv.; Story's Commentaries, §§ 686, 740, Rawle's Commentaries, 200; 2 Wilson's Law Lectures, 165, 2 Curtis' History of the Constitution, 171, 397; American Law Register, March, 1867, (Dwight's Trial by Impeachment); Wharton's State Trials; Trial of Alexander Addison; 1 Dall., 329; Pickering and Gardner's Trial of Judge Prescott; 5 Webster's Works, 502. (I.) 5 Hildreth's United States, 88, 201; 9 Cobbett's Works; Trial of William Blount; Wharton's State Trials, 200; 3 Sen. Leg. Jour., App. (II.) 5 Hildreth's United States, 510; 3 Spencer's United States, 53; 3 Sen. Leg. Jour., App.; Annals of Congress, 8th Cong., 1st Sess., 315-368. (III.) 5 Hildreth's United States, 543; 3 Spencer's United States, 53; 1 Garland's Life of Randolph, 196; Evans' Trial of Judge Chase; Smith and Lloyd's Trial of Judge Chase; 3 Sen. Leg. Jour., App.; 3 Benton's Debates of Congress, 88, 173. (IV.) Stansbury's Trial of Judge Peck; 10 Benton's Debates of Congress, 546, 556; 11 ib., 24, 124. (V.) 47-49 Congressional Globe; 44 Rep. House Comm., 37th Cong., 2d Sess. (VI.) Impeachment of President Johnson, published by order of the Senate; Schuckers' Life of S P. Chase, 547. (VII.) Impeachment of Secretary Belknap, published by order of the Senate; Appleton's Annual Cyclopedia, 1876, 686. For the acts of May 8, 1792, Feb 13, 1795, Feb 20, 1863, and March 2, 1867, see TENURE OF OFFICE. ALEXANDER JOHNSTON. IMPRESSMENTIMPRESSMENT. (See EMBARGO, in U. S. History.) IMPRISONMENT FOR DEBTIMPRISONMENT FOR DEBT. (See DEBT) INCOME TAX.INCOME TAX. A tax upon income has many qualities which recommend it to the economist. It accords perfectly with the first maxim of taxation as laid down by Adam Smith: "The subjects of every state ought to contribute toward the support of government as nearly as possible in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state." It would fall upon that portion of the community which is best able to contribute to the expenses of government, for it presupposes an income, and justice demands that it shall be levied only upon income that is not essential to the existence of the payer. Moreover as a direct tax it falls more upon the richer classes than upon the poorer, for this is the general tendency of direct taxes, and this tendency is further increased by an exemption from taxation of incomes below a certain amount. An income tax may then be regarded as a compensatory tax, as a tax which is complementary to a system of indirect taxes; because indirect taxes, falling upon consumption, require a relatively greater sacrifice from the poorer classes, and as the expenditure of people upon taxed commodities bears no regular proportion to their wealth, these indirect taxes touch but slightly the rich. While an indirect tax upon consumption will reach every class in the community, an income tax will, as has already been noted, fall upon that class which is in the enjoyment of an income over and above a certain sum. But the crowning merit of a tax upon income is that, if justly assessed, it would not act upon prices, like a tax upon a commodity; nor would it affect the normal distribution and employment of capital, or interfere with the free action of labor; nor finally, would it favor any particular class or classes of the community at the expense of any other class, or of the great body of the people, the consumers—effects which are apt to be produced by indirect taxation. All this supposes that the tax is equitably levied, and were this condition possible no tax would be more in accordance with correct economic principles. It is moreover an elastic tax, for as the wealth of a people increases, the proceeds of the tax must increase, and at the present time (1882) there is no surer index of England's advance in material prosperity than the slow increase in the returns of the income tax. No objection, based upon general principles, could be raised against the assessment and collection of a moderate tax on incomes above what is necessary to existence, if it could be assessed equitably and without causing injustice to any one, and if it could be collected with facility. —But such a tax can exist only in theory, and when an attempt is made to put it in practice it becomes one of the most unequal taxes that can be imposed, the difficulties being almost wholly in the assessment. Such a tax can not, under any of the methods that have been suggested, be made an equal tax without raising up such a complex system of assessment and collection as to create insuperable obstacles to its collection. We can only approximate to an equal assessment. The first difficulty lies in the determining of what is the income to be taxed. Either the personal statement of the tax payer of the income he enjoys must be depended on, or there must be a body of trained officials for determining the income of each contributor; or the two methods must be combined. The weakness of depending upon the statement of the tax payer is at once apparent and unless there is an open and honest declaration on the part of the individual, the tax either becomes nugatory, or arbitrary and oppressive. The interest of the tax payer will induce him to evade his share of the burden by concealing a part of or underrating his true income, and the higher the rate of the tax the greater is the inducement offered to evasion. Moreover, while the conscientious tax payer makes a full and honest return of his income, the dishonest one will seek to escape his burden, and in this way the tax will be an unequal tax. For this reason the tax has been called "a tax upon honesty and a bounty on perjury and fraud." This is illustrated by the manner of collecting this tax as now practiced in England. The bank of England when it pays the dividends on the funds deducts the income tax and credits it to the government; the salaries of those employed in the government offices and in the army and navy are definitely known to the officials, and not one of these fund holders and government employés, can escape the payment of his full tax. The income of farmers is roughly estimated to be one-half the rental of the farm, and the tax is levied on that basis. But for the incomes of all engaged in manufacturing or other industrial enterprises, and of those engaged in professions, the statement of the interested parties must be depended upon, and undoubtedly evasion of taxation is practiced to a great extent among these classes. So that there are certain classes of the community taxed either upon their full incomes or upon a portion of them fixed on a well-defined principle, from which there can be no escape, side by side with others who may wholly escape taxation. The result is, that such a system is a discriminating and therefore unjust system, and the difficulty thus raised has never been successfully overcome. So long as the income tax rests mainly upon voluntary assessment it will be an unjust tax, and on that ground stands condemned. Yet there is one very curious instance in which this principle of voluntary assessment was carried to its fullest extent. "At Hamburg every inhabitant is obliged to pay to the state ¼ per cent. of all that he possesses, and as the wealth of the people of Hamburg consists principally in stock, this tax may be considered as a tax upon stock. Every man assesses himself, and, in the presence of the magistrate, puts annually into the public coffer a certain sum of money, which he declares upon oath to be ¼ per cent. of all that he possesses, but without declaring what it amounts to, or being liable to any examination upon that subject. This tax is generally supposed to be paid with great fidelity." And, Adam Smith adds, it is not peculiar to the people of Hamburg. To attempt to put into practice any such tax at the present day would be absurd, and it could never be said of it that it was paid with great fidelity. —A system of government officials to decide on a person's ability to pay, has become a necessary appendage to an income tax, and unless the rate of taxation is very low there should be some means of establishing the correctness of the individual return, and of making such corrections as may be deemed necessary. But if voluntary assessment causes inequality of taxation, an official assessment only increases this inequality, though at the same time it may serve to remedy some evils incident to such a system. Thus, in their report for 1861-2, the inland revenue commissioners gave some instances where official interference had remedied some glaring abuses of voluntary assessments. "We have already reported to your lordships one remarkable case of recent occurrence, where a trading firm having returned 'nil' as their profits for the year 1861-2, the surveyor induced the district commissioners to assess them at £12,000, and upon appeal obtained a close confirmation of his estimate by proof from their own books that the correct charge was rather more than £12,000 as the average of the three preceding years. To take another example from a different part of the kingdom: A. B. some years ago returned £15,000 as his assessable income, but the amount was raised by the commissioners to £20,000, which he paid. The following year he made no return, and the assessment of the commissioners was again £20,000, but the surveyor charged him on £45,000, the duty on which was paid without appeal. Again, the next year he made no return, and again the charge was raised by the surveyor, who raised him to £60,000, with the same result as in the former instance." —Yet official assessment is an arbitrary assessment. All income is not derived from the same source, but from many; and some of these are of an intangible nature, and will escape the closest official scrutiny, while others are not easily appreciated. So that such assessment is at best guesswork. Nor is the situation improved by introducing any artificial measure of income, such as the size of the house, the number of horses, or of servants, the rental paid for a farm, etc., etc. Expenditure is no true gauge of income, for a man may be induced to spend more than he can reasonably afford, to maintain appearances. But the greatest objection to official assessments is that they require inquisitorial proceedings which are more suited to a despotic than to a liberal and enlightened government; they require a constant interference with the affairs of individuals, and while they often fail to discover what it is their object to learn, they serve to keep up a feeling of irritation and discontent. The tax is regarded as obnoxious chiefly on the ground that it is inquisitorial. —An objection that is urged against the English income tax, by which all incomes above a certain limit are taxed at the same rate without regard to the sources from which they are derived, is, that no distinction is made between transient and permanent incomes. It is urged that professional incomes, which are in their nature precarious, depending upon the continuance of the life, health, or other physical or mental quality of the receiver, should be taxed at a lower rate than permanent incomes, such as are derived from land or from investments in the public funds. This objection is a just one, but in order to remedy it such a complex and cumbrous scale of duties and exemptions must be introduced as to create obstacles as great, if not greater, than those now existing. A uniform rate is easily collected, and this question of administration is an important one. The inequality caused by taxing both classes of income alike would be somewhat diminished were the income tax made permanent. Thus, to take the example of Mr. Fawcett, the sum of £10,000 will purchase a life annuity of £600 or an annuity of £300 forever, supposing the rate of interest to be 3 per cent. "But if the income tax were permanently fixed at the uniform rate of 5 per cent., A's £10,000 would have to pay an income tax of £15 a year forever, because he is supposed to invest it in the form of a permanent annuity. B's £10,000, however, would only have to pay £30 a year during his lifetime, because his annuity of £600 will cease at his death. If A and B wished to redeem the income tax on the £10,000 they respectively possess, they would each have to pay exactly the same sum to the government; for the present value of an annuity of £30 to be continued during B's lifetime must be equivalent in value to a permanent annuity of £15, because it has been assumed that the present value of these annuities is equal." And he goes on to show that if the tax was not permanent an injustice would be done to A were temporary incomes taxed at a lower rate than permanent incomes. But these conditions are not fulfilled. The English income tax is not a permanent one, but is renewed from time to time, although it might, for all practical purposes, be regarded as a permanent tax; because while it has ever been considered a temporary tax, to be maintained only so long as it is necessary, yet the state of the British revenues is such as to preclude the possibility of its suppression for some time yet to come. —The justice of exempting small incomes from the income tax can not be questioned, for, as has been said, this tax is in modern systems of finance intended to supplement indirect taxation, which falls most heavily on small incomes, and this object would be defeated were additional burdens imposed through its agency on the incomes of the lower classes. But at what point to limit the exemption is a difficult and important question to decide, because on the correct solution of this question depend the incidence of the tax and its productiveness. A sum sufficient to obtain the necessaries of life should be exempted, for otherwise the condition of the people would deteriorate, a recourse to a lower standard of living being enforced. But any further exemption must be decided by the amount of taxes to be levied, the state of public opinion respecting taxation, and, above all, the economical condition of the people. Thus, in England the limit of taxable income may be fixed higher than in France; for in the former country the wealth is massed chiefly in a comparatively few hands, and the incomes of a large portion of the people average much higher than in France, where wealth is more evenly distributed among the population and the average income is comparatively small. The exemption of all incomes below £150 is estimated to exempt from taxation one-half of the taxable income in England; under a like exemption three-fourths of the taxable income of France would escape taxation. On the other hand, when the limit is fixed too high the tax becomes a farce. Thus, in the United States in 1868 when incomes below $1,000 were exempt, the number of persons who paid the tax was 259,385; but when the amount of exemption was raised to $2,000, the number of taxable persons was reduced to 116,000, and subsequently fell to 71,000 out of a total population of about 40,000,000. Experience, therefore, demonstrates that an exemption in the United States of $2,000 of income will exempt more than nine-tenths of the entire property of the country, and more than ninety-nine-hundredths of the property owners from the tax. The results proved that the limit was absurdly high. —In England not only are all incomes below £150 exempt, but a deduction of £120 is made on all incomes between £150 and £400, so that an income of £400 is taxed only on £280. But if some inequalities are abolished by this generous allowance, others as glaring and unjust are created. Thus, an income of £150 will pay the full tax, but an income of a few shillings less will be exempt. Again, an income of £400 is taxed on £280 only, but one of £401 is taxed at its full value. To correct this manifest injustice Mr. Mill proposed to determine the limit of exemption, fixing it at as low an amount as possible, to be determined as nearly as may be by the bare cost of subsistence, and to deduct this sum from all incomes whatever, only taxing the remainder. Thus, if £100 was selected as the limit, then an income of £350 would be taxed on £250; one of £500 on £400, etc., etc. This plan, which was actually in operation in this country, does away with whatever injustice is incident to the system of allowing a deduction from certain incomes as just described. —An income tax can be levied with profit only in a country where capital is abundant, manufactures and commerce well developed and progressive, and where there is a marked tendency for the national wealth to increase. The distribution of wealth in a country affects the rate of the tax and the limit of exemption, both being lower in countries where wealth is evenly distributed and the average income is small. But the lower a nation stands in material wealth and commercial and industrial activity, the less is it fitted for an income tax. Thus, in India there is an immense population, but very little wealth, and an attempt to introduce an income tax in that country signally failed. In the Chittagong district of Bengal, which may be taken to illustrate the operation of this tax, the population numbered 1,127,402 souls. Yet in the whole district only 876 incomes were assessed in 1870-71, as exceeding £50 per annum. The total amount of these 876 incomes was about £100,000, and the amount of income tax realized was £3,161. In the following year the rate was reduced from an average of 3 1/8; per cent. to 1 1/24 per cent., and the minimum of income liable to assessment was raised to £75 per annum; the amount of the tax then realized for 1871-2 was only £809, which probably did not cover the cost of administration. The impossibility of continuing such a tax was soon recognized, and it was abolished. —To return again to the maxim of Adam Smith: "The subjects of every state ought to contribute toward the support of the government as nearly as possible in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state." Many economists and financiers have believed that to carry out this maxim it is necessary to tax income in proportion to its amount; to frame a scale of rates increasing with the amount of the income, so that the higher the income the greater in proportion is the tax paid. If, they say, a man with $1,000 income pays a tax of $50, one with $10,000 income should pay, not $500—not at the same rate—but at a higher, say $1,000. But this, apart from the difficulty of framing a scale of rates, would be an extremely vicious method of imposing a tax. For no two persons are circumstanced alike, although both may receive the same income as measured in dollars; for the one may be able to spend all in his personal enjoyments, while the income of the other may be already burdened by necessary charges, which consume a large part of it. To tax these incomes at the same rate would cause hardship and gross injustice; for what is to one a comparatively small contribution, to the other amounts to confiscation. Suppose the amount of tax is tripled every time the income is doubled—a progression that does not appear to be rapid—a point is soon reached where the whole income is absorbed by the tax. Thus:  Such a tax would discourage all saving and end by driving from the country those with large fortunes unless by fraud they could escape the tax. It is moreover a communistic tax, because it seeks to equalize fortunes by discrediting saving, and in so doing aims at a more general distribution of the wealth of a country. In a country with democratic institutions there is danger that the income tax even when levied as in England at the present time, may be used by the poorer classes as a means of oppressing the richer classes on whom the tax falls, and this tendency has been noted in England by Prof. Fawcett, and in this country by Mr. David A Wells. A graduated or progressive income tax is but a logical sequence of the theory that the state may properly interfere with the distribution of wealth, a theory that rests on purely sentimental grounds, and has no basis in fact or reason. In many of the cantons of Switzerland the tax upon income is made a progressive tax, only a certain portion of the income being taxed, or a graduated scale of rates is framed. Thus, in Zurich incomes of 20,000 francs pay on only one-half of this amount, or on 10,000 francs; incomes of 30,000 francs pay on six-tenths; of 50,000 francs on seven-tenths; of 100,000 francs on eight-tenths, and of 200,000 francs on nine-tenths. But the tax is not levied on a like method in other cantons in which a progressive tax is imposed. (See Traité de la Science des Finances, Leroy Beaulieu, vol. i., p. 151.) —HISTORY. In the United States but one tax upon income has been imposed by the federal government, and it arose from the necessities of the government incident to the rebellion. An act of congress of Aug. 5, 1861, authorized an income tax of 3 per cent. on all incomes over $800 per annum, but this law was in the following year superseded by that of July, 1862. Under this act incomes under $5,000 were taxed 5 per cent., with an exemption of $600 and house rent actually paid. Incomes in excess of $5,000 and not in excess of $10,000 were taxed 2½ per cent. in addition, and incomes over $10,000 5 per cent. additional, without any exemptions whatever. Further taxes of 5 per cent. on incomes accruing to Americans residing abroad, and 1½ per cent. on incomes from interest on securities of the United States were imposed, but these expired after 1865. In estimating the income, all other taxes, national, state and local, were first deducted, as well as the $600 exempted as above. In 1864 a special tax of 5 per cent. was imposed on all incomes above $600, as well from banks, railroads and salaries, as from other sources, and produced to the treasury $28,929,312.02. In the same year the income tax was readjusted, and all incomes between $600 and $5,000 were taxed at the rate of 5 per cent.; and incomes above $5,000 at 10 per cent. The revenue obtained from this source reached its highest point in 1866 under these rates. Mr. Fessenden, at that time secretary of the treasury, in his annual report for 1864, suggested that "the income tax should be collected upon all, without exemption. As the law is, it opens the door to innumerable frauds, and in a young and growing country the vast majority of incomes are small, while all participate alike in the blessings of good government. The adoption of a scale, augmenting the rate of taxation upon incomes as they rise in amount, though unequal in one sense, can not be considered oppressive or unjust, inasmuch as the ability to pay increases in much more than arithmetical proportion as the amount of income exceeds the limit of reasonable necessity." Fortunately for the country, at that time burdened with one of the most oppressive systems of taxation ever imposed, neither of the secretary's recommendations were acted upon, and the nation escaped adding to the already long list of its financial and commercial blunders, those of a universal and a graduated or progressive income tax. Although when incomes below $5,000 were taxed at one rate, 5 per cent., those between $5,000 and $10,000 at a somewhat higher rate, 7½ per cent., and finally incomes above $10,000 at 10 per cent., there was a moderate progression, it was not such as is recommended by Say, or like the tax we have described in a previous paragraph. —In 1865 the limit of exemption was raised from $600 to $1,000, being rendered necessary by the great rise in prices consequent upon the onerous internal and customs duties on commodities and the great depreciation of the currency, and the differential taxes on incomes in excess of $5,000 were repealed. —In 1866 the whole number of persons assessed on the annual list was 460,170. In the following year the full effect of the changes in the amount of exemption and in the rate of the tax began to be felt; and as showing these changes and at the same time as giving a rough indication of the distribution of the wealth in this country, the following table will be instructive:  And further as showing the unequal incidence of the tax it may be noted that in 1869 the states of Massachusetts, New York, New Jersey, Pennsylvania, Ohio, Illinois and California, paid three-fourths of the entire income tax collected in that year, although they possessed but 40 per cent. of the assessed property and 40 per cent. of the total population of the country. —The tax was to expire in 1870, but it was renewed, the rate of tax being reduced to 2½ per cent. and the sum allowed to be deducted from each person's gross income was raised to $2,000. Whatever reasons there were for raising the limit of exemption from $600 to $1,000, they did not exist for still further raising it to $2,000, and as if to make the tax a still greater absurdity all state or local taxes paid in the preceding year, and all losses "actually sustained during the year from fires, floods, shipwreck, or that occurred in trade; the amount of interest paid during the year; the amount paid for rent, or labor to cultivate land; the amount paid for rent of premises actually occupied; and the sums expended for the usual and ordinary repairs of such premises," could be deducted before the tax was assessed. The result of such sweeping exemptions and deductions could easily have been foretold. The number of persons assessed for income fell in 1871 to 74,775, and in 1872 to 72,949; while the proceeds of the tax practically hardly afforded revenue sufficient to pay the cost of collection. The tax expired in 1872, not being renewed. It was but a war measure, and it is doubtful if another such tax will be again imposed in this country unless a like necessity arises. The amounts collected from income, including salaries, for each year from 1863 to 1872 are given in the following table:
Together with the arrears collected since 1872 the total amount raised from income was $346,911,760 48. —We have purposely omitted to speak of the question of the constitutionality of an income tax as levied under the act of 1864, because the question never came before the supreme court for adjudication, and it would be useless to revive the question now, and the main reasoning on either side will alone be noticed. The supreme court had already decided that according to the constitution direct taxes are only such as fall upon land or upon polls, and the economic definition of a direct tax was thus thrust aside. But it is urged that a tax upon income is in reality a tax upon the property from which the income is derived, and under such a theory a tax upon income derived from land would fall under the constitutional definition of a direct tax as explained by the courts, and should therefore be apportioned among the states according to their population. Moreover internal revenue law seems to recognize the principle that a tax upon income is a tax upon the property from which the income accrues. Thus by section 127 of the act of 1864 a tax was laid on succession to real estate, and such succession was defined to be every such disposition of real estate whereby any person should become entitled to any real estate or the income thereof. Furthermore it is established by statute law in this country that a grant or devise of the income of real estate in perpetuity is a grant or devise of the fee itself. In Dobbins vs. the Commissioners of Erie County (16 Peters, 435), it was held that a tax upon income or profits of real estate is a direct tax, upon the principle that a tax upon the income of a thing is the same as a tax on the thing itself. And many more cases in which the same principle was recognized could be cited. The tax was however levied and collected, and, although a most unpopular tax and regarded as a fit subject of evasion, was endured so long as congress deemed it necessary to continue it. It is a curious fact that the dissatisfaction against the income tax was most loudly expressed while the $2,000 exemption was in force, or, in other words, while it fell upon the rich alone. —The history of income taxes as practiced by other nations has been often told, and we have space only for a statement of the general principles of these taxes. In England the income tax is rather a collection of different taxes, and, as Mr. Gladstone said in 1853, is more of a code or system of taxation than a single tax. To the bulk of the people, however, it is known in its most obnoxious form as a tax upon ordinary incomes—salaries, professional earnings, profits of trading, etc. Assessments on these are now made under schedule "D," which is the most important of all the five schedules into which this system of taxation is subdivided; for it comprises, in addition to incomes of this private character, the profits of public companies, such as gas and water works, or railways, dividends on foreign and colonial investments, as well as the profits on working mines and quarries, the rents of fishings and shootings, etc. The next in importance is schedule "A," which comprises incomes from the rent of land and houses, proceeds of tithes, royalties, etc. With this may be classed schedule "B," which embraces the tax payable by occupiers of land, except nursery gardens, the profits on which are assessed, like those of trades and professions, under schedule "D." Schedule "C" regulates the assessment on incomes from the public funds, and schedule "E" that on incomes derived from official appointments, whether in the public service, or in the service of corporate bodies. These duties yielded in the year ending March 31, 1881, the sum of £10,776,000. They are the most elastic of the English taxes. —In Prussia are found two taxes, the classensteuer and the einkommensteuer, the former reaching only incomes of less than 1,000 thalers. The einkommensteuer is assessed in forty classes, and varies from 2½ to 3 per cent. In Austria the tax is divided into four parts, and varies from 1 to 10 per cent. Its product is but small. In Italy a tax is imposed on all incomes other than that derived from land, and is even more complex than that first levied by the United States. Moreover it is a tax of a very burdensome nature, amounting to no less than 13 1/5 per cent on the incomes taxed, although certain allowances and exemptions reduce its burden on incomes of an uncertain nature. Thus, all incomes below 400 lire are exempt, and the tax falls upon only three-eighths of incomes derived from labor alone, and upon one-half of incomes derived from public offices or pensions. The elaborate attempts made to render the incidence of this tax equal have signally failed. Of the 184,000,000 lire collected in 1877, 85,000,000 lire were obtained from incomes derived from state pensions and salaries, interest on the public debt, gains of lotteries, and other forms of income which can not possibly escape the cognizance of the government. The remaining 99,000,000 lire represent what was collected on incomes derived from all sources apart from land, and should represent a very large share of all the private income of the Italian people, and these figures prove to what an extent the tax is evaded. (See L'Impot sur le Revenu Mobilier en Italie, by M. Vessélovsky, St. Petersburg, 1879.) —BIBLIOGRAPHY. First and Second Reports of the Select Committee on the Income and Property Tax, London, 1852; Leroy Beauheu's Traité de la Science des Finances; M'Culloch, Taxation and the Funding System; Levi, On Taxation; Reports of the Commissioner of Internal Revenue. WORTHINGTON C. FORD. INDEMNITY IN CASE OF WARINDEMNITY IN CASE OF WAR. When a war has desolated a country, leaving destruction and ruin behind it, is there reason for an equalization of the burden of material damage (more or less approximate)? This question would be rarely presented if a country were invaded throughout its entire territory, and all its provinces suffered almost equally; but when only one part of a country has been occupied, while the rest has not seen the enemy, the question of compensation, of a general sharing in the whole amount of damages, naturally arises, and the provinces visited by the scourge present their claims. Claims are made even in districts where all the inhabitants have not suffered equally. Are these claims well founded? Is there cause for compensation, for indemnity, for equalization of damages? We shall examine this briefly. —The question of indemnity in case of war is much more complicated than might be supposed. In the first place, damages inflicted by the national army must be distinguished from those caused by the enemy. The acts attributed to the military authority of the country may have taken place during peace; in that case there is reason for an indemnity, regulated in France, for instance, according to the law of eminent domain (May 3, 1841). In time of war, when the enemy is still at a certain distance and preparations are made to meet him, the decree of Aug. 10, 1853, article 38, admits rather a limited right to indemnity. But in article 39 of the same decree we read the following: "No occupation, no deprivation of use, no demolition or other damage resulting from an act of war, and from a measure of defense taken either by a military authority, during the state of siege, or by an army corps or detachment, in presence of the enemy, gives a right to indemnity." This provision does not exist in the decree of July 8, 1791, (as to which see articles 35 to 38.) —What is to be understood by an act of war? The law does not define it, but jurisprudence has determined certain cases, the most prominent of which we shall cite. The following have been declared acts of war giving no right to indemnity: the cutting of timber at the order of the commander in-chief to cover the retreat of troops manœuvering in presence of the enemy (council of state, March 26, 1823, Bellamy); the removal of timber by hostile troops, for the use of these troops, by order of the mayors, to satisfy the requisitions of the enemy (Nov. 16, 1825, Schoengrun); the destruction of a house caused by the explosion of a powder magazine by order of French authority in presence of the enemy (March 15, 1826, Daisy). This has always been the rule in France, and in this regard the chief of the executive power was right in appealing to it when he maintained in the discussion of the law, Sept. 6, 1871, that in principle no indemnity was (legally) due French citizens who had suffered from damages inflicted by the invasion, and that at most only assistance was due them. —In the same discussion (session of Aug. 5, 1871, Journal Officiel of Aug. 6.) Thiers maintained a different doctrine in relation to damage caused the inhabitants of Paris by the bombardment of May, 1871, during the insurrection of the commune. "And as to those quarters of Paris," said he, "of which you have just spoken, and concerning which you have said that we wish to do nothing for the cottages, while we are about to rebuild the mansions of the wealthy, in the part of the city which we have attacked. Gentlemen, you have not seen those quarters which you describe so strangely. Where is the mansion of the wealthy? Look for it in those quarters ruined by the bombs and bullets, not of the enemy, but of our own army, of France, of the national right, which strove at all cost to re-establish order, indispensable to the very life of the nation. And do you know what principle created the right in this case? The principle that when a government commits an act intentionally, with a definite will, not by chance, but after reflection, it owes a complete indemnity for the damage which it causes. Read our laws, study the principles of public justice, and you will see this is the distinction always made. "The state never indemnifies for the chances of war, it only indemnifies for voluntary, intentional, foreseen damages of which it is the author"25 —We do not know whether jurisprudence is always in accord with the second half of the proposition which we have just cited, but we find it (this second half) excellent; it is not for us to discover whether any one can hold a contrary opinion. Therefore we consider it as established, that acts originating with a national army, damages caused by the order, and in the interests of a country, should be repaired by that country.26 We may mention here for a similar reason the law of 10 Vendémiaire, year IV. (Oct. 2, 1795), which makes the French communes responsible in case of riots, etc., and obliges them to indemnify sufferers. —We come now to the cases in which damage was caused by the enemy. In the decisions of the council of state cited above, and the complete sketch of which is before us, no law was quoted; the decision was founded on simple reasoning, or rather on the simple assertion, nothing is due for acts of war. Still there is a law of Aug. 11, 1792, (see Journal Officiel, 1871, pages 2457 and 2459), and another of 1793 (Aug. 14 and 16), which declare "in the name of the nation that it will indemnify all citizens for all losses which they have sustained, or may sustain in consequence of the invasion of the enemy." Later, in 1816, a sum of one hundred millions was in like manner granted to the invaded departments. But whatever the previous jurisprudence, and even legislation, since the law of Sept. 6, 1871, the principle of indemnity is—if not completely, at least partially—adopted, in France, by article 1, which we here quote: "Compensation will be accorded to all who have been subjected during the invasion to contributions of war, requisitions, either in money or kind, fines and material damages." The word compensation is the result of a compromise. The government wished to grant only aid, "relief," without recognizing a right: the deputies demanded an indemnity: the term chosen seemed vague enough to satisfy both parties, but in reality the word compensation is a synonym of indemnity, and has nothing in common with aid. The French law of April 7, 1873, is to the same effect, and the principle of national solidarity may be considered established.27 The following, among others, are the terms employed by Casimir Périer: "I admit also, and I go further, I maintain that it is out of the question to impose the special burden of military contributions and military requisitions in money levied by the enemy, on the invaded departments, on the departments which bore them in addition to all the other misery which they suffered." And further, "I maintain that these are facts affecting the whole nation, and it is impossible to avoid distributing the burden of them over all the national territory." Let us add that Bouffet, rejecting the word aid, said, "The reparation which the invaded departments demand is the reparation of a damage of which the whole state is the cause and for which the whole state is responsible." —There is scarcely any other country except Germany in which the question is important. It can have no importance in England, which is protected against invasion by the waters which wash its shores, and when necessary by its "wooden walls" Germany, on the contrary, has long been the battle ground of European passions, therefore the doctrine of indemnification prevailed there at an early period. We have before us a work published in 1798, at Wurzburg, with the title: Weber (councilor, etc.), Ueber die Repartition der Kriegsschaden. (On the distribution of the burden—of damages caused by war—on the entire nation.) This work cites and discusses a great number of earlier publications, and, like the majority of previous authors, concludes in favor of indemnity, resting on the argument of national solidarity. We regret that we can not make numerous extracts from this very interesting work, in which questions are discussed from a legal point of view, and texts or precedents are freely used in their support. Among the different opinions examined is that also which considers acts of war as acts of chance, cases of hazard or superior force, cases which among others the French code declared as not justifying indemnity. (See Civil Code, article 1148, and many others.) But Weber does not admit this argument. Chance, if there is any, consists in this, that one district was visited rather than another, or that such a house or such a field was damaged rather than another, but the fact itself of damage has nothing fortuitous in it. The state desired or allowed the war, and as the damage is the natural or inevitable result thereof, there is nothing unforeseen in it. The states are at war, and it is for them to bear the consequences, and not individuals who are unable to do so. We shall add that if the conflagration caused by lightning, the destruction produced by an earthquake, the ravages occasioned by a flood, are examples of superior force, giving no chance of indemnity, it is because the lightning, the earthquake and the flood are not personalities that may be called to account. But let a cannon ball throw down my garden wall, let a locomotive in running off the track cause me damage, and I shall find some person to summon before the tribunals. —Weber next discusses the law Aquilia (Roman law), according to which a damage which I cause in the interests of my own legitimate defense does not make me responsible. Thus, if I destroy my neighbor's house during a fire to keep my own from burning, I am within my rights. In like manner the state may demolish your house, fell your forest, cut up your field, if this is necessary for state defense. But, says Weber (omitting the objections which the principle raises in itself), the law Aquilia, which is private law, does not apply to the case in point: it is not a question of law among individuals, but a burden imposed by the state in the interest of all. —There is also the law Rhodia This law is found in the French Code of Commerce, article 400, and elsewhere; it declares as a common duty the reparation of all damage happening to a vessel, and more especially the indemnity to be paid to the owner of the merchandise thrown overboard to lighten the ship in danger. The owner of the merchandise bears his part, but the others bear theirs also. The principle is beyond attack, but its formula is perhaps not happy when applied to war. But we are not obliged to stop here, since we have clearer and more applicable modern formulæ. It only remains, in summing up, to cite some of the most recent cases of indemnities, granted to invaded provinces. —In 1866, immediately after the conclusion of peace, the Austrian ministry named (Aug. 3) a commission entrusted with investigating the damages in order to discover their total amount. The word employed is Schaden-Ersatz, compensation or indemnity. Still a complete indemnity was not granted. Saxony, by vote of Jan. 17, 1867, seems to have been more generous. In 1871, the German law of June 14 indemnified completely the inhabitants of Alsace-Lorraine. (See the law in the French journals of the last days of June, 1871.) At the same date, June 14, 1871, a commission was appointed at Berlin to fix the indemnity due German shipowners, in consequence of war. In fine, modern law is in favor of indemnity, without, however, imposing on the nation the payment of the whole damage; for the person injured must also bear his share, since he too is a part of the nation. MAURICE BLOCK. INDEPENDENCEINDEPENDENCE. "Every nation, as well as every individual, has the right not to allow any other nation to assail its safety or its integrity," says Vattel in his "Treatise on the Law of Nations," in the beginning of the chapter entitled. "On the law of safety, and the effects of the sovereignty and independence of nations." These few words contain the whole secret of the development and the life of nations. Self-preservation and improvement form the two-fold aim of true activity; independence to attain this end is a necessary right. —A nation is a collective being, and all the ideas which we form of its rights, its duties, its action, its end, are derived from our knowledge of the human individual. Like the individual, it must apply itself to the preservation of its own existence, to the care of its interests, and to the development of its faculties. Hence, independence is, for the nation as for the individual, the primary law of its existence, and the first condition of development. If a nation desires to improve its institutions, it must have full liberty to change, if necessary, the basis of its constitution and its form of government. It must be sole and supreme judge upon this point. No power can be allowed to argue against it that the changes which it makes within itself are dangerous examples for its neighbors. Nor can any fault be found with it because it seeks to establish whatever is favorable to its progress. It possesses the right to develop in every sense of the word, and it can be stopped only when it encroaches upon the development of some other nation, and lays itself liable to the charge of hindering it in its natural development. —Together with the right to improve its condition, a nation possesses the right to defend itself. A people has an absolute right to create what establishments it pleases, to develop and organize its forces, to multiply and improve all the means of action at its disposal, army, navy, fortresses, in order to provide for its safety. So long as it does not become aggressive, it is free to act, and if it does not feel itself inviolably guaranteed by the strict enforcement of international legislation, it has a right to provide for its own defense as it sees proper. This right results from the right of self-preservation, and is inseparable from the idea of independence. —A nation may make treaties of peace, friendship, commerce and navigation, as also any alliances it may judge favorable to its interests. But a nation in enriching itself or in fortifying itself by alliances or otherwise, may give umbrage to neighboring nations; wherefore Martens, one of the foremost among modern publicists, has established certain rules of courtesy. According to him, every nation is bound to give satisfactory explanations of all preparations made and all enterprises undertaken with a view to its aggrandizement or security. Its conduct will be still more praiseworthy, if in certain cases it reply in anticipation to the questions which might be asked of it. It certainly would be well to observe these considerations, it being distinctly understood, however, that they must never constitute either a right of superiority or interference on the one hand, or a duty of condescension or feeling of inferiority on the other. But is it quite certain that these explanations will always constitute a perfect guarantee, or will it not frequently be necessary to a wait that reprobation with which public opinion more and more severely regards conquest, and which will one day secure to every man the free possession of his home? —The idea of independence excludes the idea of the interference of one nation in the affairs of another; but when this interference is consented to by the other nation which is to profit by it, it is perfectly just and legitimate. In a word, independence guarantees to all nations that none of them shall be impeded in its development, to the end that each one may lend its aid to progress in every direction. This assistance, however, must not exceed what is necessary to procure the relief needed by the nation that is in distress. Vattel thinks that this interference should not go beyond the clear and precise terms of a treaty entered into beforehand. It must never by any means become a source of profit or aggrandizement for the nation which contributes the assistance required. A nation, in fact, has not only rights but also duties; and, to resume the parallel which we established in the beginning of this article between a nation and an individual, we believe that when it does not observe these duties and commits faults or crimes, it should be subjected to the inflictions of the decrees of the same justice in so far as this justice can be exercised when passing from an individual to a collective being. But a distinction must be made between the faults a nation commits outside its own boundaries and those committed at home. In the latter case its independence must be respected like the conscience of an individual. But when it is guilty of offensive acts against other collective beings living around it, then it is necessarily open to their vengeance and their repression. —All nations are equal among themselves, for they all possess the same rights and the same-duties. Grotius is of opinion that all states have equal rights, no matter how unequal their strength. Baron de Wolf laid it down as a fundamental maxim that all nations are with respect to one another in a state of independence and natural equality. G. F. de Martens says that between nations as between individuals there is a perfect equality of natural and absolute rights. Equal rights necessarily imply equal duties. In virtue of their equality all nations are entitled to the same regard and respect, and no nation should be exposed to anything which might wound its personality. The independence of each must harmonize with the equality of all, and, in like manner, the independence of all with the equality of each. —Every nation has the right to recognize or to refuse to recognize the government which another nation has adopted, the sovereign whom it has chosen, or the title which this sovereign assumes. But equality exacts that no nation be made to suffer for the changes it may see proper to make in its own state, provided it does not cause detriment to any other nation. —It is customary for a sovereign or his representative when traveling outside his own territory to receive certain honors; but these can not be exacted of a people, who, without any feeling of contempt whatever, do not consider themselves bound to give such tokens of attention; nor of a nation whose manners and constitution forbid too great a deference to crowned heads. An illustration of this latter case might be found in a republic. In Switzerland, for example, honors, particularly military honors, are never accorded to any monarch traversing the territory or sojourning therein. It may, however, happen that the sovereign in question will receive a visit of high courtesy from some members of a cantonal government or from the president of the federal council. The United States follow about the same rule, though they seem to find no difficulty in departing from this custom according to circumstances. —The right of precedence has sometimes caused ruptures between governments and produced wars, because pride, presumption and vanity have often taken the place of a sentiment of equality. When carried to such as extreme, the exactions of rank are at once puerile and cruel. But men are more frequently prompted to action by their rights than they are actuated by a sense of their duty, and hence it is necessary to establish rules and customs in order to prevent contests. Formerly these rules were numerous and often whimsical; but most of them have now fallen into discredit. There are in our time too serious interests to discuss, for nations to insist upon details dictated by vanity. G. CHAMPSEIN. INDEPENDENT IN POLITICSINDEPENDENT IN POLITICS. (See PRIMARY ELECTIONS.) INDEPENDENT TREASURYINDEPENDENT TREASURY (IN U. S. HISTORY). —1. Until 1840 the United States government never ventured to assume entire control of its own funds. These were left with the two corporations known as banks of the United States, 1791-1811 and 1816-36 (see BANK CONTROVERSIES, II., III.), and in other years with various state banks selected by the secretary of the treasury. The agreements with the state banks usually provided, 1, that they should receive all moneys collected by federal receivers; 2, that they should pay at sight all drafts from the treasury; 3, that the treasury should maintain in each bank a sum fixed by agreement in each case, as a permanent deposit, the use of which without interest should repay the bank for its trouble and responsibility. Such agreements were also made with state banks during the existence of a United States bank, but with the additional proviso that the state bank should, on request, transfer to the United States bank, or one of its branches, any money received in excess of the amount of the permanent deposit. These agreements were legal even during the existence of the second bank of the United States under that clause which directed deposits to be made in the bank or its branches, "unless the secretary of the treasury shall at any time otherwise order and direct." (See DEPOSITS, REMOVAL OF.) The permanent deposits amounted, in 1824, to about $900,000 in twelve banks of the western and southwestern states. They were made for the convenience of the government in localities where there was no branch of the national bank; and Jackson's "removal of the deposits" was an expansion of this temporary provision into a medium for the overthrow of the national bank itself. —The first annual message of President Jackson, in which the first vague menace to the recharter of the bank of the United States was given, suggested the creation of a national bank whose functions and employés should be under the direct control of the treasury department; but this project, under the new system of dismissals from office for political reasons (see DEMOCRATIC PARTY, IV.), would have only needlessly intensified the opposition to the administration, and it was abandoned. Just before the removal of the deposits in 1833, the president had suggested the employment of state banks as depositaries of revenue, and his idea was carried into effect by the act of June 23, 1836. It authorized the secretary of the treasury to select at least one bank in each state and territory, and to order the revenue to be deposited therein. The deposit banks, or "pet banks," as they were commonly called, were to discharge all the duties heretofore performed by the bank of the United States, were to pay in specie, and were not to issue small notes. The surplus revenue was to be "deposited" with the states, nominally as a loan. (See INTERNAL IMPROVEMENTS, II.) —During the whole of Jackson's second term economic changes were taking place, which were hurried by some of the results of his political warfare into a rapid and unhealthy development. The first 1,200 miles of the American railway system had been built, and the steam navigation of western waters had been begun; the number of immigrants reached 275,099 in the years 1831-7, as against 79,741 for the seven years previous; the sales of public lands had increased from $2,329,356.14, in 1830, to $24,877,179.86, in 1836; the payments for public lands gave employment to the notes of countless new banks, with and without capital; and the deposit of this sudden and enormous increase of federal revenue in the pet banks stimulated them also to operations far beyond the limits of their legitimate capital. July 11, 1836, the secretary of the treasury issued his "specie circular," ordering government agents to receive only gold and silver in payment for public lands. This checked the stream of paper in its movement to the west, and turned it back upon the east; and the banks which had issued their notes so lavishly, unable to redeem them, suspended specie payments in May, 1837. The result was the panic of 1837. —II. As the federal government, whose entire resources were on deposit in the pet banks, was included among the creditors to whom payment was refused, President Van Buren, soon after his inauguration, found himself at a loss to defray the government's running expenses, and was compelled to call an extra session of congress for Sept. 4, 1837. His message at the opening of the session declared that the national bank and the state bank systems had both had a fair trial and both had failed, and that the people were now anxious to entirely separate the fiscal concerns of the government from all banking corporations. To this end he suggested that the revenues of the government should be left in the hands of the collecting officers, or assistant treasurers, throughout the country, to be disbursed, transferred, and accounted for to the secretary of the treasury, the fidelity of the agents to be secured by bonds. This was the independent treasury or sub-treasury plan, which had been introduced into the house in 1834, by Gordon, of Virginia, and had then received but 33 votes, only one of these being given by a democrat. President Van Buren now adopted it, against the wish of the great majority of his party, and almost the whole of his single term of office was devoted to the establishment of it. —Congress was nominally democratic in both branches. In the senate there were 33 democrats to 19 whigs (Calhoun being included in the latter). and in the house 125 democrats to 116 whigs. But a part of the democrats (4 in the senate and 14 in the house) called themselves conservatives, and opposed the adoption of the sub-treasury system as an attempt to ruin the state banks by depriving them of the funds of the government; and in the house these conservatives held the balance of power. In the senate Silas Wright, of New York, chairman of the finance committee, reported a sub-treasury bill which, as amended after its reception, prohibited the government agents from receiving anything but gold and silver. This was the realization of the long cherished wish of Benton and other leading democrats, to base the party policy absolutely on "hard money," leaving paper entirely to the credit of state corporations and private citizens. In the states, furthermore, the advanced democrats (see LOCO-FOCO) wished to prohibit charters for any such purpose, and to leave paper entirely to individual credit. The whigs hoped to gain a new national bank out of the confusion; the conservatives merely desired the continuance of government support for the state banks. —The Wright bill passed the senate by a vote of 26 to 20, and was tabled in the house by a vote of 119 to 107; evidently, excluding "pairs," which were just beginning to be recognized in congress, the conservative vote had been decisive in the house. In the first regular session, beginning Dec. 4, 1837, and in the second regular session, beginning Dec. 3, 1838, the same process was repeated, the Wright bill being passed by the senate, and voted down by the house. The only attempts at remedial legislation by this congress were the acts of Oct. 16, 1837, ordering the public moneys to be withdrawn from the deposit banks, and mulcting delinquent banks in interest and damages, and of Oct. 12, 1837, authorizing the issue of $10,000,000 in transferable treasury notes, payable in one year with 6 per cent. interest. The specie circular still controlled the agents of the government, and a two-thirds majority was not available in congress to over-ride the veto which it was known would be laid upon any paper money legislation. All parties were waiting for the country's decision in the congressional elections of 1838, which proved to be the most closely contested in our history (see BROAD SEAL WAR); but, while waiting, the government, which had deposited $37,000,000 with the states, and had claims for $15,000,000 against banks and individuals, came so near insolvency that congress was forced, May 21, 1838, to authorize the issue of fresh treasury notes in place of those canceled. —In the 26th congress, which met Dec. 2, 1839, the nominal control of, the house depended on the admission of the New Jersey members, and was given to the democrats by the admission of their contestants. The balance of power, however, was now held by the few sub-treasury whigs, whose importance was recognized by the election of one of their number speaker, supported by the democrats. The conservatives had almost entirely disappeared; only four of them had been re-elected to the new congress, and these had nearly ceased their opposition to the sub-treasury. The Wright bill was again introduced, was debated through the session, passed both houses by votes of 24 to 18 in the senate, and 124 to 107 in the house, and became a law, July 4, 1840, by the signature of the president. It directed rooms, vaults and safes to be provided for the treasury, in which the public money was to be kept; it provided for four receivers general, at New York, Boston, Charleston and St. Louis, and made the United States mint and the branch mint at New Orleans places of deposit; it directed the treasurers of the United States and of the mints, the receivers general, and all other officers charged with the custody of public money, to give proper bonds for its care and for its transfer when ordered by the secretary of the treasury or postmaster general; and enacted that after June 30, 1843, all payments to or by the United States should be in gold and silver exclusively. —The results of the first brief trial of the sub-treasury system, July 4, 1840—Aug. 13, 1841, totally failed to verify the prophecies of the whigs and conservatives. It inflicted no damage upon the state banks, or upon business at large; it did not increase the number of offices at the disposal of the president and his party, or the power of the president over the commercial interests of the country; it laid no "cornerstone of despotism its practical operation was much more smooth and successful than might have been anticipated in a civil service already so far debased; and it plainly relieved the government from any except indirect and remote consequences of suspension of specie payments by the banks, and the country from the difficulties and dangers incident to the control of a national bank by a representative body. Its passage opened a hitherto unthought-of door of escape from a national bank so inviting that it would have been foolish for the dominant party not to have availed itself of it, and so convenient, when tried, that it would have been impossible on a fair test to induce the country to retrace its steps. Only the momentum of the whig party proper, acquired by years of struggle for a national bank, compelled its leaders to keep up for a time a contest whose futility they were quick to perceive. The first successful execution of the independent treasury act made a national bank an impossibility with general popular consent, and completed the "divorce of bank and state," for which the president had for three years been exerting all his energy and influence. The result must be accredited mainly to Van Buren; usually regarded as a shuffler and intriguer, he had in the midst of the most wide-spread panic yet known in America, unshrinkingly and openly committed his political future to the then unpopular doctrine of non-interference by government, had forced his party to concur with him, and had finally, after three failures in as many sessions of congress, been successful in establishing the independence of the treasury. —III. The election of Harrison in 1840 was accomplished by a union of all the heterogeneous elements of opposition, and by that double-faced promulgation of different policies for different sections which the democrats imitated with equal success in 1844. (See DEMOCRATIC PARTY, IV.; WHIG PARTY, II) Nevertheless it brought into the house a majority of whigs whose party training had predetermined them to one purpose, the renewal of the bank of the United States. (See BANK CONTROVERSIES, IV.) To this end the repeal of the independent treasury act was essential, and the repealing act was passed by votes of 29 to 18 in the senate and 134 to 87 in the house, and became law, Aug. 13, 1841. The next congress, 1843-5, although it had a democratic majority in the house, had a sufficient whig majority in the senate to defeat any effort to renew the sub-treasury system. For five years after its repeal, therefore, the treasury was managed practically at the discretion of its secretary, and with no adequate regulation by law. Where depositaries were absolutely necessary the banks of the different states were used, and the secretary of the treasury obtained collateral security for the deposits from such banks as were willing to give it. Polk's election brought in a congress democratic in both branches. The sub-treasury system was again introduced, passed both houses and became law, Aug. 6, 1846. This act was essentially the same as that of July 4, 1840, and has remained in force almost unchanged. The act of Feb. 25, 1863, creating a system of national banks, authorized the secretary of the treasury to make any of these associations depositaries of public money, except receipts from customs; the original sub-treasury act had provided but seven places of deposit: New York, Boston, Charleston, St. Louis, the mints at Philadelphia and St. Louis, and the treasury at Washington, the first four being under the control of assistant treasurers. (See, in general, BANK CONTROVERSIES; DEPOSITS, REMOVAL OF; DEMOCRATIC PARTY, IV.; WHIG PARTY, II.)—(I.) See 26 Niles' Register, 291; 3 Parton's Life of Jackson, 272, 515; Sumner's American Currency, 114; 2 von Holst's United States, 174; Bromwell's Immigration, 174; 1 Colton's Life and Times of Clay, 456; 1 Benton's Thirty Years' View, 676; the act of June 23, 1836, is in 5 Stat. at Large, 52. (II.) See 2 Statesman's Manual (Van Buren's Messages); 12 Benton's Debates of Congress, 506, and 13:403; 4 Webster's Works, 402, 424; 3 Whig Review, 465; the acts of Oct. 12 and 17, 1837, and the subtreasury act of July 4, 1840, are in 5 Stat. at Large, 201, 206, and 385. (III.) See Gillet's Democracy in the United States, 193; Schuckers' Life of Chase, 300; J. H. Walker's Money, Trade and Banking, 81; the act of Aug. 13, 1841, is in 5 Stat. at Large, 439, that of Aug 6, 1846, in 9 Stat. at Large, 59, and that of Feb. 25, 1863, in 12 Stat. at Large, 696. ALEXANDER JOHNSTON. INDIAINDIA. (See EAST INDIES.) INDIANAINDIANA, a state of the American Union, formed mainly from the Virginia cession, and in the north from small strips of the Massachusetts and Connecticut cessions. (See ORDINANCE OF 1787, TERRITORIES, ILLINOIS.) May 7, 1800, the northwest territory was divided, Ohio being made a separate territory, and the remainder erected into the territory of Indiana. In 1805 and 1809 the territories of Illinois and Michigan were set off from Indiana, thus reducing the latter territory to its present limits. —April 19, 1816, an enabling act was passed by congress for the formation of a state government by the people of Indiana territory, the following boundaries being assigned by the act to the new state: "Bounded on the east by the meridian line which forms the western boundary of the state of Ohio; on the south by the river Ohio, from the mouth of the Great Miami river to the mouth of the river Wabash; on the west by a line drawn along the middle of the Wabash, from its mouth to a point where a due north line drawn from the town of Vincennes would last touch the northwestern shore of the said river; and from thence by a due north line until the same shall intersect an east and west line drawn through a point ten miles north of the southern extreme of Lake Michigan; on the north by the said east and west line, until the same shall intersect the first mentioned meridian line which forms the western boundary of the state of Ohio." The state convention met at Corydon, June 10, 1816, ratified the boundaries established in the act of congress, and formed the first constitution of the state of Indians. It fixed the governor's term of office at three years, but prohibited the holding of the office by one person longer than six years in any term of nine years; provided for a popular vote every twelfth year on the question of calling a convention to revise the constitution; gave the right of suffrage to "white male citizens of the United States, of the age of twenty one years and upward," on one year's residence: prohibited slavery, and provided that no alteration of the constitution should ever introduce slavery into the state, "since the holding of any part of the human creation in slavery or involuntary servitude can only originate in usurpation and tyranny;" prohibited the chartering of any banks in the state, except a state bank and branches; and made Corydon the seat of government until 1825, and until removed by law (as it has since been removed to Indianapolis). The state was admitted by joint resolution, Dec. 11, 1816. A new and more complete constitution was formed by a convention at Indianapolis, Feb. 10, 1851. It provided that no negro or mulatto should have the right of suffrage; changed the governor's term to four years; prohibited local or special legislation in seventeen specified cases; provided for a general banking law; prohibited the entrance of any negro or mulatto to the state; and made the employment of such negroes or mulattoes, or the encouragement of their immigration, a punishable offense. The last named provision was decided by the supreme court of the state, in November, 1866, to be repugnant to the constitution of the United States, and invalid. The constitution was ratified by popular vote, and went into effect Nov. 1, 1851. An amendment has since been made to it, repudiating any liability for certain certificates of stock, and prohibiting the state officers from paying them. (See CONSTITUTIONS, STATE.) —Indiana originally had a larger southern population than Illinois. In 1850 this part of the population amounted to near 20 per cent. of the whole, mainly from Virginia, North Carolina and Kentucky. In 1870 the proportion had decreased to less than 10 per cent. This element has apparently had a considerable influence upon the state's political history. A straight line drawn across the middle of the state would separate the southern counties, which have been quite steadily democratic since 1850, from the northern counties, which have been as steadily anti-democratic. —In presidential elections the vote of Indiana until 1860 was cast for democratic candidates, except in 1836 and 1840, when it was cast for Harrison, the whig candidate. In 1860 the state voted for Lincoln, and its vote has always since been given to republican candidates, except in 1876, when it was given to the democratic candidates by a plurality. The result in 1876 was probably due to the popularity of Hendricks, the democratic candidate for the vice-presidency, in his own state, Indiana. —Until 1822 the one representative to which Indiana was entitled was a democrat (William Hendricks), but until 1825 the representatives and United States senators were chosen more for personal than for political reasons. Upon the re-formation of parties in 1825-8 (see DEMOCRATIC PARTY, IV.) the state became democratic and remained so until 1836, with the exception of the congressional district formed from Wayne and the few surrounding counties of the east-central part of the state. This district has been steadily whig, anti Nebraska or republican since 1830. From 1836 until 1842 the senators and nearly all the representatives were whigs, the democrats, however, carrying three southern and two northern districts in 1840. In 1842, eight of the ten representatives were democrats, and two whigs, but from this time the central line of demarcation between the democratic and anti-democratic districts becomes more plainly marked. It was obscured from 1848 until 1854, during the upheaval of the national parties, there being only one whig district in the state, and, on the other hand, in 1834, all but two of the eleven districts gave anti-Nebraska majorities (see REPUBLICAN PARTY); but in 1856 the districts settled to the proportions of six democratic to five republican, the former the southern half and the latter the northern half of the state. In 1838-60, the democrats lost two of their districts, and in 1862 regained them and added two northern districts. In 1864 the republicans regained their two districts and gained four of the southern districts. These were successively regained by the democrats until, in 1870, the parties stood about as they had done in 1856. Since 1870 the current has been slightly in favor of the republicans, until in 1881 the proportion is eight republican to five democratic representatives. In the election of 1878 the republicans carried the extreme southwest, or Posey county, district, which had chosen democratic representatives since 1846. —The state elections have always been closely and stubbornly contested. The governors were democratic until 1857, with the exception of governors Wallace and Bigger, who were whigs. Since 1857 the governors have been republicans, with the exception of governors Hendricks and Williams, who were democrats. The election of 1872, at which the former was chosen, was probably the most closely contested in the history of the state, and Hendricks' election was mainly due to his personal popularity. Out of over 375,000 votes he had but 1,148 majority; the two republican candidates for congressman at large had but 126 and 533 majority respectively. —The political complexion of the legislatures has generally followed that of the congressional representation. The manner of districting the state for representation in the legislature has always been a theme for political declamation, each party accusing the other of gross unfairness. (See GERRYMANDER.) In the years of presidential elections the Indiana state elections, which occur in October, are contested with still more bitterness, because the result is supposed elsewhere to be a foreshadowing of the result in November, and money is largely sent into the state from other states to affect the election. The resulting demoralization induced the legislature, in 1877-8, to prepare an amendment to the constitution transferring the date of the election to November. This, with six other amendments (the principal ones being to prescribe a registration of voters, to strike the word "white" from the constitution, and to allow negroes and mulattoes to vote) was submitted to the people at a special election, April 5, 1880, and all received a heavy majority of the votes cast. A majority of the state supreme court, however, decided that the amendments were not adopted, as they had not received the votes of a majority of all the electors of the state, as shown by other elections. —A peculiar provision of the constitution of 1851, requiring two thirds of each house of the legislature as a quorum to do business, has often been utilized in state politics. In 1856 the state senate had two republican majority, and the house twenty-eight democratic majority. The republican senate, therefore, refused to go into joint ballot to elect United States senators, as the democratic senate had done in a similar case two years before, and claimed that neither house could take part without a quorum. The house and a minority of the senate met in joint convention and elected senators, who were seated by the United States senate after a long contest. In 1863 the republican minority withdrew, and virtually dissolved the legislature, in order to prevent the passage of a bill which deprived the governor of the power to appoint militia officers. In March, 1869, the democratic minority resigned in a body in order to prevent the ratification of the 15th amendment. A special election having been ordered, and a special session of the legislature called in April, the democratic minority, after passing the necessary appropriation bills, again resigned, but the speaker of the house ruled that a quorum was present, and the amendment was ratified. The state supreme court afterward indirectly upheld the validity of the ratification. The next legislature was democratic in both branches, and in February, 1871, the republican minority in the lower house resigned in a body in order to prevent the redistricting of the state and the passage of a resolution declaring the ratification of the 15th amendment null and void. —The most distinguished citizens of Indiana in national politics have been Thos. A. Hendricks, Oliver P. Morton, Schuyler Collax and Wm. H. English. (See those names.) Among the leading names in state politics are those of Jesse D. Bright, democratic United States senator 1845-62, expelled for treason; John W. Davis, democratic representative 1835-7, 1839-41, 1843-7, and speaker of the house 1845-7; Edward A. Hannegan, democratic representative 1833-7, senator 1843-9, and minister to Prussia 1849-50; Benjamin Harrison, republican United States senator 1881-7, William S. Holman, democratic representative 1859-65 and 1867-77, "a better critic of appropriation bills than any opposition party ever had before or since"; George W. Julian, one of the founders of the free-soil and republican parties, free-soil candidate for the vice-presidency in 1852, and republican representative 1849-51 and 1861-71; Michael C. Kerr, democratic representative 1865-73 and 1875-6, and speaker of the house; J. E. McDonald, democratic senator 1875-81; Caleb B. Smith, whig representative 1843-9, and secretary of the interior 1861-2 (see ADMINISTRATIONS); Richard W. Thompson, whig representative 1841-3 and 1847-9, and secretary of the navy 1877-81 (see ADMINISTRATIONS); James N. Tyner, republican representative 1869-75, and postmaster general 1877-81 (see ADMINISTRATIONS); and D. W. Voorhees, democratic representative 1861-6 and 1869-73, and senator 1877-85. —The name of Indiana was coined for the territory and state as a memorial of its original inhabitants, the American Indians; the derivation of the popular name of its people, "Hoosiers," is unknown. —GOVERNORS: Jonathan Jennings (1816-22), William Hendricks (1822-5), James B. Ray (1825-31), Noah Noble (1831-7), David Wallace (1837-40), Samuel Bigger (1840-43), James Whitcomb (1843-9), Joseph A. Wright (1849-57), Ashbel P. Willard (1857-61), Henry S. Lane (1861, resigned), Oliver P. Morton (1861-7), Conrad Baker (1867-73), Thomas A. Hendricks (1873-7), James D. Williams (1877-81), Albert T. Porter (1881-5). —See Poore's Federal and State Constitutions and Political Register; 2 Stat. at Large, 58, and 3:289 (for the acts of May 7, 1800, and April 19, 1816); Dillon's History of Indiana (to 1816); Chamberlain's Indiana Gazetteer (1849); Sutherland's Biographical Sketches of Members of the State Government (1861); Drapier's Brevier Legislative Reports of Indiana; Scribner's Indiana Roll of Honor (1866); Wilson's Digest (1867); Barber and Howe's History of the Western States (1867); Brown's History of Indianapolis (to 1868); Ball's History of Lake County 1834-73; Brown's State Government (1875); Goodrich and Tuttle's History of Indiana (to 1875); Porter's West in 1880, 132. ALEXANDER JOHNSTON. INDIAN TERRITORYINDIAN TERRITORY, The, a portion of the public lands of the United States, not organized in preparation for becoming a state, but set aside as a residence for various Indian tribes. —That consistent friend of the Indian, Jefferson, seems to have been the first to form the idea of transferring the Indian tribes across the Mississippi to the new acquisition of Louisiana. (See his proposed Louisiana amendment, CONSTITUTION, III.) This policy was carried out by various Indian treaties thereafter (see CHEROKEE CASE), and by the act of June 30, 1834; all the territory of the United States west of the Mississippi, and not included within Missouri, Louisiana or Arkansas, was to be "taken and deemed to be the Indian country." By another act of the same date a superintendent of Indian affairs was to be appointed, and no one was to trade or settle in the Indian country without his permission or that of one of his agents. The Indian country, or Indian territory, has since been diminished by the erection of various organized territories, until it now comprises the 68,891 square miles, bounded on the north by Kansas, east by Missouri and Arkansas, south by Texas, and west by the 100th meridian. The narrow strip of territory north of Texas, west of the 100th meridian, and east of New Mexico, has never been placed in any organized or unorganized territory by law. —The capital of the Indian territory is Tahlequah, and the population is about 75,000. The leading tribes are the Cherokees (19,000), the Choctaws(16,000), the Creeks(14,000), and the Chickasaws (5,000), but there are a large number of smaller tribes. At the outbreak of the rebellion most of the tribes were divided in sympathy, and many of them formed treaties with the confederate states, but these were readmitted to their former privileges in 1865-6, slavery being abolished among them. In 1870 a convention at Ocmulgee formed a state government, with a governor; a senate composed of one member from each nation, or group of nations, having over 2,000 population; and a house of representatives, elected in the ratio of one representative to 1,000 population. This was rejected through the objections of the smaller tribes to the composition of the senate. Efforts have since been made to organize the Indian country as the territory of Oklahoma, but the Indians object to this step strongly, and congress has not yet taken it. In 1881-2 an organized expedition from southern Kansas, styling itself "the Oklahoma colony," made persistent efforts to settle in the Indian country, in defiance of the ancient prohibitions against settling there without the consent of the government; but they have as yet been intercepted and turned back by the army. The final breaking up of the Indian imperium in imperio will probably come through the agency of the treaties made by the Indians in 1866, by which they agreed to grant the right of way through their country to railroads. Interests were thus developed which almost immediately led congress to extend the revenue laws and taxation to all territory "within the bounds of the United States," although the treaties with the Indians guaranteed to them freedom from taxation. The supreme court has upheld the power of congress to thus change the treaties, and their final abrogation is evidently only a question of time. —The act of June 30, 1834, is in 4 Stat. at Large, 729; in 2 Stat. at Large, 139, 146, will be found a summary of previous Indian acts, and supreme court decisions thereon. ALEXANDER JOHNSTON. INDIVIDUAL AND THE RACEINDIVIDUAL AND THE RACE, The. How to account for the contrast between the aggregate will (the will of the state) and the single will of individuals, is confessedly one of the most difficult problems of political science. The caprice of individuals is as manifold as their peculiarities, while the aggregate will can and must indeed be only one. How is it possible to base the aggregate will, which rules in the state, on the multiformity of divergent individual wills? —Rousseau, who explains the state as the agreement of individuals who come together as if by contract, had indeed some idea that the general will was other than the will of all. But he endeavored to evade a problem, which he could not solve, by a fiction, which stands no test. As it is very seldom that all agree, he says, the average will of the majority must pass for the will of all. This is jumping from the frying pan into the fire. In the state we are forced to respect the aggregate will as authority, that is, to respect it in all things as just; and who warrants us that the will of the majority is more just than that of the minority? Almost all great improvements, both in the state and in law, were in the beginning advocated only by single individuals, as were the blessed revelations of religion and the most fruitful discoveries of science, and were understood and accepted by a few enlightened adherents. Only after long and severe struggles with the prejudices, ignorance and crudeness of the multitude did they gradually obtain recognition. If the majority be eventually rational and just, certain it is that it is not so at all times. Therefore to assert that the aggregate will and the will of the majority are the same thing, is to set coarseness above culture, and ignorance above wisdom. —But the unity of the will of the state can be explained in this way still less than the wisdom and justice of the will of the state. The mere counting together and bringing together of many or even all separate wills can never produce one aggregate will. Millions of grains of sand thrown together will make a sand bank, but no whole. A hundred thousand dollars piled one on another is a handsome sum of money, but not a fortune. The vessel, which is baked from the grains of sand, is a whole, and so is a property or an establishment of a hundred thousand dollars a fortune, but only because upon a summing up of the different parts an idea of unity has been added, which has formed them into a whole. In the case of lifeless things this union may come from without. But if the living wills of thousands are to become one will, the unity must be found in themselves. —Hegel had remarked the want of coherence and the contradiction existing between all these separate wills, and perceived that from this confusion no unity of law could be formed. He, unlike Rousseau and Kant, understood the will, which formed the state and the law, to be, not individual caprice, but the general will, grown conscious of itself, really true and rational. But this only tells us how the will of all should be constituted in order to be recognized as the universal will; it does not explain why this universal will is right, rational, or one. —Scarcely a philosopher or jurist has recalled that we have within ourselves the contrast between the aggregate will and the individual will. Only by the double nature of man, from the contrast which we as individuals and as belonging to a race find associated in ourselves, can this two-fold character of the will be explained, but it is completely explained by that. The credit of first recognizing this, and proving the very decisive significance of this contrast for all psychological questions, belongs to Friedrich Rohmer. —We are conscious of our individual will with the same certainty as of our individual thoughts. By wishing something exclusively for myself, something which others do not wish or will not allow me, I am conscious of the opposition between my will and the will of others. Because Cæsar willed to rule Rome, Brutus willed to kill him. It is possible that both wills were only individual, but if one of them was likewise the Roman aggregate will, it is impossible that the other could be so too. —The difference of the two wills is clear enough. But how do we become conscious of the aggregate will? How, except by the opposition which arises in ourselves when we wish something for ourselves, which injures the common nature, of which we, with others, form a part? When a son raises his hand against his father, when a brother wishes to make a slave of his brother, when the thief takes another's property, a voice is audible within him which opposes his individual will. When the indolent man sinks into laziness, and the inactive man buries his talents, he is sensible of an admonition which urges him to activity. In the first case the individual will is checked; in the second it receives an impulse to action. In both cases the inner voice announces the existence of a will, which strives to contend with the will of the individual. Some call this voice the conscience, through which God speaks to man; others call it the conscience, which is immanent in human nature, and which bears testimony to the moral order dwelling in it. At bottom, both mean the same thing; but the former admit that this voice is heard in human feelings, ideas and words; and the latter do not deny that the inner harmony of human nature was given with the creation of man, and is hence in the divine order. A moral spirit lives in the conscience, which is different from our individual spirit. Our individual will is often unjust and irrational; the human will of the conscience is always just and rational. The many individual wills contradict one another; the common will of the conscience is in itself harmonious. The individual will belongs to me alone; the aggregate will, which stirs as conscience, is common to me with my family, my people, and the human race. We can call it the will of the species, or the will of the race, for the species and the race are common to all, and make a unit of all. —In the individual will is a clearer self-consciousness and a higher freedom. In the will of the species the order of nature and instinctive necessity chiefly work. Separate wills give rise to multiformity; the will of the species preserves unity and insures equality. Individual will lives only in the individual; the will of the species works through the whole species. —In each man the contrast of the race and the individual is found in one person. To the extent that we distinguish and more closely examine both these sides of our being, we obtain great light upon numerous questions. Let us endeavor to establish a few chief principles, although their exhaustive demonstration may not fall within the province of a work like the present one.
—There can be no doubt what relation human law bears to this contrast. Race is visible; and only exteriorly perceptible relations are taken cognizance of, and determined, by the law. In race, psychic and physical elements are combined into unity, and all law is made up of an intellectual-moral and a physico-formal element. Race is earthly-human, and so also is law. Race is transmitted from generation to generation, and law also outlasts the life of individuals. Race has an organic growth, and experiences regular transformations; and so the history of law is the organic growth and the regulated transformation of the laws. The life of the race is chiefly a necessity of nature, and the fundamental character of law is the moral necessity of human relations. Race is similarity, community and unity; and these are also the qualities of law. Race is the repose, and the perfection, so to speak, of law and order. —It was, therefore, a great and a fatal error of the philosophy of law to have deduced law and the state from the life of the individual and the will of the individual. Law and the state refer indirectly to individuals, inasmuch as they guarantee them protection in their action, exactly as does the corporeal race serve the mind of the individual as a dwelling place and an instrument. But the law and the state have no measure for what is most individual in the life of the heart and the mind, nor do they exercise any power over that life. Not only is the order of the state based upon the race, and in the first place upon the race to which the people belong, but the life of the state, politics, is the development of community and unity; therefore of the race. But the life of the individual has also an important share in politics; it is not merely the development of the race. There are also certain men who in their capacity of individuals are made for the state, and who give their individual life to the state. All real statesmen are such individuals. Such men are a living embodiment on a large scale of the reciprocal action of the two natures. The state is not exclusively the formation of the common nature of the people or the national race; it is indebted for a part of its existence and its importance to the individual labor of its leaders. —This leads to a further distinction within the race. There is an inborn race and an inculcated race. Whoever wishes to obtain a clear idea of the power of education not only on individual men, but in the formation of whole races or entire classes, has only to consider the influence of Moses on the Jews, of Lycurgus on the Spartans, of the government of Rome on all Roman peoples, or of the clerical education on the whole department of the Catholic clergy. Race, which is in the first place a natural idea, is thus changed to an idea of culture. The state gradually and by piecemeal transforms the nation, which is educated by it, through its ever active institutions. The necessity of common nature thus experiences the power of individual freedom. —The most important of the narrower circles of the race, into which the one human race is divided, are: 1. What we, in a psychological meaning of the expression, call the different races of mankind, those great differences which constitute the natural varieties of mankind. How these contrasts, which are apparent in the complexion, the structure of the hair, the form of the skull, and, still more, in the difference in the sensuous and intellectual faculties, and which for thousands of years have remained substantially the same, originated in the first place, whether by different creative acts, or by later workings of nature, has not yet been decided by science. But two things we know. In the first place, we know that this difference in the races of mankind is not a work of human culture, but essentially a product of macrocosmic nature, and it therefore must be accepted as a necessity. In the second place, we know that this very thing is of the highest significance in politics. Only the white race is, in the highest sense of the word, given to the formation of the state; of the white race, again, the Aryan subdivision is here in advance of the Semitic. The black Ethiopian race is evidently assigned to the tutelary training and sway of the Aryan and Semitic races. Only the yellow Mongolian race and perhaps also in other times the red (Indian) race have brought themselves to a real civilization of their own, and by themselves have developed a state, relatively speaking. 2. Races which form nations and peoples are essentially a product of human history; and human history itself is the result of the cooperation of human freedom, a natural necessity and fate. A mere glance can distinguish between the Englishman and the Frenchman, the Italian and the German, although the European culture of to day, at least in the educated classes, has effaced and destroyed a multitude of the old differences. More important than the difference in national traits, the shades of which can hardly be depicted in language, is the race contrast in national character and spirit, which chiefly determines political life. The manly pride of the Englishman is a characteristic of race, like the love of fame of the Frenchman, the calculation of the Dutchman, the philosophical nature of the German, the craftiness of the Slave, and the deceit of the Italian. The peculiarity of nations is their race. 3. Within the nation, the race of single tribes of people is modified, as among the people that of estates and classes is. 4. The family forms the narrowest circle of race. Whoever compares the family portraits of the Hapsburgs or the Bourbons for hundreds of years, will be surprised at the energy and tenacity with which nature so long held fast a fixed family character. The very same thing is repeated in families of the middle class. With family traits are also transmitted a definite family character and family spirit. The mental side of the race of families is therefore no less worthy of attention than the physical. —All these races together, of the family, of the nation, and of mankind, form the animated instrument, which the individual living therein uses during his earthly life. The race serves him; but it demands in return also from the ruling individual, respect for the conditions of its life, and due regard for its limited faculties. Happy, the intellectually powerful individual, who has at the same time received a strong and enduring race as an inheritance. Unhappy, the man in whom race and individual struggle with each other in continual dissension. So, happy is the state, whose race of people is guided by statesmen, whose individual nature is the loftiest expression of their race; and miserable is the state, whose rulers are not worthy of the better race. A. D. HALL, Tr. INDIVIDUALITY.INDIVIDUALITY. This word suggests a problem which our age is compelled to propound if not to solve, namely, the respective parts which should be assigned to the individual, to the state and to society. This problem has undoubtedly existed from the very beginning of civilization, but only in a latent state. The three interests, when confronted with one another, have not been slow to conflict, each of them exhibiting considerable strength and corresponding with some one of the human passions: egoism in the individual, affection in society, ambition in the state. —For the harmonious development of humanity it is necessary that no one of these forces should destroy the others. This necessity has at all times been instinctively felt, but it is only in our day that men have become conscious of it. So also is it only in our day that the problem has been formally propounded, and the attempt been made to bring direct influence to bear upon its solution. —As Lapalisse would say, it is better to understand the problem clearly than to guess at it blindly. However, we are tempted to believe that a clear understanding of the problem will render its solution all the more difficult. In fact, an interest which is conscious of its own legitimateness is much less disposed to make concessions than a mere tendency whose action we feel perhaps while disproving it. —But it is rare to find men such perfect masters of their inclinations that their reason is not affected by them. And was reason ever found wanting in arguments to serve human passions? Hence it follows that a passionate man is apt to become a more exclusive individualist, socialist or adherent of the government than one of a different disposition. —What we have just given expression to, is merely an apprehension; but by consulting certain famous works from the "Leviathan" of Hobbes to the "Icarie" of Cabet, it will be found that this apprehension is not entirely without foundation. However this may be, let us endeavor, if not to define the part of the individual, in relation to society and the state, at least to collect the principal elements of a definition. —The individual can, strictly speaking, exist without society, but he could not improve without it. It is society that makes of man "a two-legged animal without feathers." Nature likewise has endowed man not only with all the selfish inclinations which constitute his instinct of self-preservation, but also with the affection which attracts him toward his like. But affection is often weaker than egoism; in other words, interest often prevails over morality; this is unfortunate, but experience proves that it is true. The élite of men endeavor first of all to strengthen society, and the more brutal and ignorant nations are, the more ingeniously the eminent minds of the period try to increase social tendencies and forces. —Among the manifestations of this tendency, we will mention, in the economic order, art and trade organizations and castes, and in the spiritual order the rule of the church. But at a given moment a part of society becomes too large, the various institutions which were intended to protect it separate from it and form themselves into individual establishments which possess a collective egoism; and a reaction becoming both necessary and inevitable, the part of the individual increases. The force of this reaction spent, we are now no longer over passionate, and it will be possible for us to examine the question coolly. —Mens sana in corpore sano. In like manner society is sound when the individual is not corrupt. Man, like water, becomes corrupt by stagnation. Advancement and progress are what the body needs as well as the mind. Man, if his faculties have not been compromised by domestic education, or by social and political influences, is naturally progressive: an invincible curiosity urges him to acquire knowledge; an insatiable avidity prompts him to appropriate to himself all that he possibly can. When we build air-castles, do we not begin our dreams with the most modest desires, and behold them increase before our eyes until they surpass the bounds of the marvellous? —Such is man And we should congratulate ourselves that he is such. Without this stimulant how would our will overcome the inertia which characterizes the purely material part of our being, the clay of which we are made? how would we overcome the pain which labor causes? But, without labor, there can be no progress. Hence it follows, that the individual, in order to prosper, must have the fullest possible liberty to work, materially and intellectually. It would not be at all difficult for us to deduce from this proposition the necessity of enjoying all the political, religious, civil and other liberties which this age so energetically claims. But the developments would oblige us to repeat what has already been said elsewhere. —Society should therefore restrain the individual as little as possible, and ask of him only such sacrifices as are indispensably necessary. This is, at bottom, really to the interest of society. In restraining man's inclination to injure his neighbor or to appropriate the fruit of his labor, society protects the weak, without really giving the strong any reason to complain. It teaches him so to direct his efforts that humanity will profit by them, either against his evil passions, or against the brute forces of nature. The object of society is par excellence the moral and intellectual culture of man. To it we owe the development of our sentiments of affection, as well as all our scientific discoveries. Without society there can be no morality, and without morality man would become the most relentless and formidable enemy of his fellow-man. —From these propositions one might be led to infer that society should take precedence of the individual, just as the mind rules the body. We willingly admit this formula, for the very reason that it is vague. In these matters it is impossible to be very precise. But we must be on our guard against the abuse which may be made of it to oppress the individual. It must ever be borne in mind that the individual is the raw material of society, and that whatever is injurious to one is injurious to the other. In like manner, the thought is assuredly infinitely more precious than the brain in which it is elaborated, no one knows how; but be careful not to injure the brain, if you would preserve the thought. —The individualistic and social tendencies of men, when left to themselves, are often the first to prevail. We have already said that egoism is stronger than affection. It was necessary that some institution should come to the aid of society, and this institution was found in the state. In fact, many states are formed by means of which morality does not approve, but time purifies almost as much as fire; and in a word, the state has become the frame-work of society, and to a certain extent the body in which it has become incarnate. —The state was not slow to constitute itself the arm of society. If it had stopped with the fulfillment of this task, all would have been well. But the more society became incarnate in the state, the more the state became incarnate in men, and these men, say what we will, have not always been the élite of our species. If not their personal interests, at least their views and opinions always exerted more or less influence over their public acts, and as they had the power, they circumscribed the liberty of the individual, first for the greater good of society, then for that of the state, and finally for his own benefit: some of them would willingly have made man a mere automation. Did they not oblige him to believe what the authorities believed, to work according to methods prescribed by law, to adapt his clothing and diet to rules, to retire at sound of the curfew bell, and not to take a step except in official leading strings? —It is against these exaggerated pretensions that we contend. Let us give to society and to the state what belong to them, but let us maintain the rights of the individual. We are ready to make every possible sacrifice for society and for the state: we will open our purses, we will shed our blood, we will restrain our passions for them; but in return, leave us the right to use and abuse our individuality. We wish to belong to ourselves; protect us against others; it is each one's own duty to protect himself against himself. Are we not responsible agents? —We will not insist any further; but will merely propound our theory, and demonstrate how it can be applied in a very few words. Whatever belongs exclusively to the domain of individual interest, should be left entirely free. Society should use only moral force; public opinion and human respect are, besides, powers of the first order. The duty of the state is to watch over the general interests of the nation, political, legal and moral; and as to the province of economy, it should occupy itself only with things that are beyond the power of the individual, or which the individual could not reach without its assistance; this does not clash with its duty to maintain order and respect for morality, and to protect the weak. MAURICE BLOCK. INDUSTRIAL ARBITRATION AND CONCILIATIONINDUSTRIAL ARBITRATION AND CONCILIATION is the name given to certain methods of preventing labor disputes or settling them when they arise, by their submission to the decision of umpires or judges, or by conferences between the parties to the dispute or their authorized representatives. —Though the terms arbitration and conciliation are jointly used to name this system, and though in many instances, in recent years, the best results came from their joint operation, yet they are by no means the same, though having the same object in view. Arbitration implies a more or less formal hearing of the matter in dispute before an umpire or umpires, with a formal decision or award which the parties are legally or morally bound to accept. Under conciliation there is no umpire, nor any power lodged with any one or more persons to make a binding award. Any decision arrived at is the result of conferences, and is of the nature of an agreement. As in arbitration, there are a hearing and discussion of the questions at issue, but usually very informal. The result of arbitration partakes of the nature of a binding judgment; of conciliation, of a mutual agreement. —In their origin and modes of working, arbitration and conciliation are either, 1, Legal, that is, established and operated under statute law with its sanctions and power for enforcing awards; or, 2, Voluntary, that is, established and operated by mutual agreement. The submission of disputes under legal arbitration and conciliation is either, 1, Compulsory, that is, the question must be submitted for decision upon the application of either party; or, 2, Voluntary, that is, it can be submitted by mutual agreement. In either case, while there may be a choice as to the submission of the dispute, yet when so submitted the decision is binding upon both parties, and can, so far as its character permits, be legally enforced. Of course, the submission of questions to voluntary arbitration and conciliation is always voluntary, and the awards are only morally binding and can not be legally enforced. —The method of compulsory arbitration and conciliation, under the forms and sanctions of law, which has existed in France and Belgium since early in the present century, and which in the former country succeeded to some of the powers of determining trade and labor disputes possessed by the ancient trade guilds until they were abolished in 1791, is treated of under the title CONSEILS DES PRUD'HOMMES, which see. The only other country in which arbitration and conciliation has been employed to any considerable extent is England, though the forms and methods used differ materially from the French and Belgian. In treating of English arbitration and conciliation it will be most convenient to consider its history and methods under two heads, Legal and Voluntary,—I. Legal Arbitration and Conciliation in England. Under the Elizabethan statutes concerning labor which codified many of the rules and regulations existing for centuries among the English craft-guilds, the assessment of wages and settlement of disputes between masters and apprentices, as well as the protection of the latter, were placed entirely in the hands of magistrates. Under the decisions of the courts these statutes were only applicable to the trades existing at the time of their passage, and to these only in certain localities. During succeeding reigns these statutes were modified and enlarged. New industries were included in their scope and additional provisions and statutes enacted providing various means for the settlement of labor disputes, gradually taking from the magistrates their arbitrating power and developing the idea of arbitration by chosen or appointed referees. In 1824 all these acts were consolidated and replaced by that of the 5 Geo. IV., cap. 96, entitled "An act to consolidate and amend the laws relative to the arbitration of disputes between masters and workmen." This act, which was one of the outcomes of the investigation of the operation of the labor laws by a committee of the house of commons, was evidently modeled after the French law establishing conseils des prud'hommes, but adapted to the different character of English industry and institutions. In it provision is made for the compulsory submission to arbitration, upon the request of either party to the same, of disputes arising between employer and employed in certain specified trades and upon certain subjects, which are also specified in the act. The justice of the peace, before whom the case is brought, or arbitrators elected by a board, composed equally of employers and employed, nominated by the justice, hear and determine the dispute; or any other method that may be mutually agreed upon by the disputants can be adopted; but it is carefully provided that "nothing in this act contained shall authorize any justice or justices acting as hereinafter mentioned to establish a rate of wages or prices of labor or workmanship at which the workman shall in future be paid, unless with the mutual consent of both masters and workmen." The awards under this act could be enforced by legal processes. Though this act is still in full force in England, it has rarely, if ever, been used. —Shortly after the passage of this act voluntary boards of arbitration and conciliation were introduced into some of the industries of England. In addition to the formal arbitration of existing disputes contemplated in the act of 1824, these boards considered and fixed future rates of wages, and also provided for conciliation committees, whose province was to adjust differences between employers and employed by mutual good offices without a formal hearing and award. In 1867 these boards had become so numerous and successful that an attempt was made to give them a legal basis, if they so chose, by the passage of the 30 and 31 Vict., cap 105, commonly called Lord St. Leonards' Act. This act is entitled "An act to establish equitable councils of conciliation to adjust differences between masters and workmen." It provides for the formation of a council of conciliation under authority of the home secretary, upon the joint petition of the masters and workmen of any particular trade working in the same locality. It also specifies the method of election of this council, the qualifications of electors, and other matters necessary to its proceedings. The council is to hear all differences between masters and workmen, as set forth in the act of 1824, that may be submitted to them by both parties. The award is to be final and conclusive, and may be enforced by proceedings of distress, sale or imprisonment, as provided in the recited acts. It is, however, specially provided that "nothing in this act contained shall authorize the said council to establish a rate of wages, or price of labor, or workmanship, at which the workman shall in future be paid." The quorum of the council is to consist of three members, but a committee called the committee of conciliation, appointed by the council, and consisting of one master and one workman, shall endeavor to reconcile all differences in the first instance. The chairman is to be unconnected with trade, and has a casting voice. No counsel, solicitors or attorneys are to be heard before the council or committee without the consent of both parties—In both of these acts especial care is taken to provide against the fixing of future rates of wages—one of the most prolific sources of dispute. This was a serious defect. Accordingly, in 1872 an act was passed, the uses of which, briefly stated, are three, viz.: 1. To provide the most simple machinery for a binding submission to arbitration, and for the proceedings therein. 2. To extend facilities of arbitration to questions of wages, hours, and other conditions of labor, and also to all the numerous and important matters which may otherwise have to be determined by justices under the provisions of the master and servant act, 1867. 3. To provide for submission to arbitration of future disputes by anticipation, without waiting until the time when a dispute has actually arisen, and the parties are too much excited to agree upon arbitrators. These acts have been of but little practical value. In their best features the recent ones have followed, not preceded, the voluntary practice of arbitration and conciliation, and they have only sought to give the forms and sanctions of law to a practice that was successfully in force without such forms and sanctions. If the same (if not better) results can be attained without an appeal to law, the English character is such that it will always prefer the non-legal to the legal. —II. Voluntary Arbitration and Conciliation in England. Prior to 1860 there had been in England frequent settlements of labor disputes by their voluntary submission to boards of arbitration and conciliation. These had attracted but little attention, however, and the system was making little or no progress. In this year, through the efforts of Mr. A. J. Mundella, the first permanent or continuous board of arbitration and conciliation in England was established in the hosiery and glove trade at Nottingham. This was soon followed, though without any knowledge of the existence of the Nottingham board, by the establishment of a board in the Wolverhampton building trades through the efforts of Mr. Rupert Kettle, who has since been knighted for his services in behalf of this system. Boards were soon formed in the manufactured iron trade, and in the coal and other trades, and for nearly twenty years many labor disputes and the rates of wages for many thousands of workmen have been settled by these boards without strikes or lockouts. These boards are purely voluntary. They have no sanction of law—no legal existence. There is no forced submission of disputes, nor is there any power except a man's sense of honor, public opinion, and the aggregate honor of the trades unions or the employers' associations to enforce the acceptance of the awards; and to the honor of the parties involved be it said, that except in a very few isolated and unimportant cases, these have been found sufficient. —The boards are made up of an equal number of employers and employed, each class electing its own representatives. In some boards each establishment has a representative of each class, as in the north of England iron trade. In other cases groups of establishments elect the members, as in the lace trade of Nottingham. The officers of the boards are generally a president and a vice-president, one an employer and the other an employé, and two secretaries, one for each class. The two classes have equal influence and an equal vote on all questions. Meetings are held monthly, quarterly or less frequently, at which all subjects at issue are discussed and settled, if possible. In all of these boards there is a provision for settling minor disputes by conciliation without convening the entire board. Failing a settlement in this way, however, the dispute is referred to the board, when it is generally adjusted, unless it is a subject of some moment. Broader questions, those that affect the trade of an entire district, or of a class, are in the first instance generally referred to the board, and, in case the board can not agree, to an umpire. In the Nottingham board there is no umpire, the board deciding all questions. This referee or umpire is in some cases a regularly elected officer of the board—a standing umpire or referee, as he is often termed—or he may be chosen for the decision of a particular question. His decision is final. The members of the board are clothed by their constituents with plenary powers. The expenses are met equally by each class. The course of proceedings before the board is very simple. In case of a claim for an advance in wages, for example, the employés' representatives submit, through their secretary, a formal statement setting forth the reasons for the demand, such as an increase in the demand for the goods manufactured and in the selling price for the same, increased demand for labor, or higher prices paid in other districts manufacturing similar goods. The representatives of the employers submit a formal statement in reply, stating their reasons for refusing the demand. With these statements before them the justice and advisability of the demand are discussed by the members. The proceedings are without ceremony. No valuable time is wasted discussing parliamentary rules. Statements are made, and questioned or impeached. Proofs are demanded and furnished. The circumstances surrounding the market and the trade are canvassed, estimates compared, statistics set forth, and the strength of competition measured. As the outcome of all this, a result is generally reached that, if not entirely satisfactory to one or the other party, is accepted as preferable to a strike or lockout. —Arbitration and conciliation has not been generally adopted in England as a means of settling labor disputes. In many trades it has prevailed through a series of years and then been abandoned and the method of strikes and lockouts substituted; but in those trades in which it has been most thoroughly and systematically used during the time it prevailed, strikes and lockouts were almost unknown. One great advantage of these boards is, that they form a market where labor and capital can come together and in a friendly spirit fix what is "a fair price for a fair day's work." Judge Kettle admirably expresses this when he says, "I verify believe that, without limiting the influence of fair competition, boards of arbitration, properly worked, afford the best means of fixing the market price of a fair day's work." They also have served to bring employer and employé into closer relations. Under their action a most friendly feeling has taken the place of hostility, and confidence and mutual respect have been inspired where formerly all was suspicion and hatred. The changed relations of employer and employed have been recognized. They have met around the same table as equals, and out of all this have come juster and truer views of their mutual rights and duties. —For further and more detailed information on this subject consult Industrial Conciliation, by Henry Crompton, London, 1876; Strikes and Arbitration, by Rupert Kettle, London, 1867; Masters and Men, by Rupert Kettle, London, 1871; Report of the Trades Union Committee of the British Social Science Association, London, 1860; Report on the Practical Operations of Arbitration and Conciliation in the Settlement of Difficulties between Employers and Employés in England. by Jos. D. Weeks, Harrisburg, Pa., 1879; Industrial Arbitration and Conciliation in New York, Ohio and Pennsylvania, by Jos. D. Weeks, Boston, 1881. Jos. D. WEEKS. INDUSTRIAL EXPOSITIONSINDUSTRIAL EXPOSITIONS. (See EXPOSITIONS.) INDUSTRYINDUSTRY. I. DEFINITION OF THE WORD; EXPLANATION OF THE SUBJECT. The meaning of this word, at first quite restricted, has gradually extended, in proportion as the importance of the phenomena to which it relates and the connection of the various labors of man were better understood. It may be recognized, however, as having at present three distinct acceptations. —In common language, the word industry most frequently means nothing more than manufacturing industry, whose special object it is to transform, in the working, the raw materials furnished by agriculture or mining. We usually say, for example, commerce and industry, when we wish to distinguish the shop from the workshop, the store from the factory. We also say agriculture and industry when we wish to compare farming with the activity of cities. This popular acceptation is moreover the one which long prevailed, and which still prevails quite frequently in official language and law. —Nevertheless, a broader meaning is sometimes given, in ordinary speech, to the word industry. It is used in a general way to describe all material labors, agricultural as well as manufacturing or commercial, in distinction from those which appear to have a more elevated character, such as the labors of scholars, artists, public functionaries, etc. In this case, industry forms in a certain way an antithesis to all that is embraced under the term liberal professions. We say, for instance, that a man begins an industry when he becomes an agriculturist, a manufacturer or a merchant, and that he abandons industry, when he exchanges one of these occupations for that of an artist, an advocate, a physician or a public functionary. This interpretation, like the first, has gone into official language and law, in which the restricted meaning which we have just mentioned, or the broader one to which we call attention, is given to the word industry according as it is desired to express one sense or the other. —Though neither of these acceptations of the word belongs really to economic language, for the reason that each one of them seems to create an absolute separation between labors which are only distinguished by differences of kind or species, still they are both found in the works of the principal economists. Adam Smith uses no other, and they appear frequently enough in the writings of his successors. It is difficult, moreover, to reject either of them absolutely, since they are sanctioned by use, and there is perhaps no inconvenience in adopting them sometimes, provided that care be taken clearly to define their application. But we must hasten to say that, in proportion as the field of economic science extended, while being cleared from obscurity, in proportion as the resemblances between human labors as well as the force of the ties which connect them were more clearly explained, the necessity was felt of giving a broader meaning to the word. The distinction so frequently established between the industrial arts and the professions called liberal, seems false or empty, at least when taken in an absolute sense. It was understood that these labors, no matter how different they may be in their processes and in their relations to their immediate object, are connected, bound together, lend each other a mutual support; that they are governed by the same laws, and lead in reality to the same ends; that there is, consequently, a reason to include them under a common designation. In this way, by the natural movement of economic studies, men came, gradually, to include under the general name of industry, all labors, of whatever nature, which contribute directly or indirectly to satisfy the wants of man. —So that, in genuine economic language, industry is human labor, without distinction of kind; labor considered in the infinite variety of its applications. The word industry would even be the exact synonym of labor, were it not necessary to recognize for it a higher meaning in some respects. But, while we can scarcely understand by the term labor, only the exercise pure and simple of the physical forces, or the intellectual faculties of man, we must include under the term industry the employment of these same forces, these same faculties, with all the social combinations which increase their power, and the concurrence of all the physical agents which favor their action. It is, in one word, labor but labor raised, if it be permitted to say so to a higher power, both by the agency and combination of individual forces, and the aid of auxiliary agents which man has been able to gather around himself. —Considered from this broad and general point of view, industry is, as we shall see in the article POLITICAL ECONOMY the real object of the investigations of economic science, which studies its organization and explains its laws. By taking it up in this way we are evidently relieved from exalting its importance. We have no need of dwelling on those commonplace considerations which are usually brought forward to extol its advantages and merits; considerations which to our thinking are always of meagre fitness, since they lower what they pretend to exalt, and which would be particularly out of place here. Industry, as we look upon it, is not a secondary fact seeking its place; it is the active life of man; it is, in some respects, the man altogether. When addressing men there is no need of wasting eloquence to heighten the importance of such a fact. —But if we are freed from insisting on this point, we have another task to fulfill, that of showing at a rough estimate how industry is organized as a whole; to present a miniature picture of this organization, and indicate at least its principal features. This is the place to group and collect the general phenomena presented to us in the field of industry, and which form the ordinary text of economic studies. It is necessary to show, as far as is possible in a summary analysis, how these phenomena are arranged and connected, in order to point out the place which each one of them occupies in the industrial order; this is the best way of showing, at the same time, the extent of the field which economic science must cover. —To attain this object successfully, it is well understood that what we have to consider is industry as it exists, such as civilization has made it, that is to say, with all the organic elements developed in it by time. Still, as industry, considered with reference to the organization of the labors which it embraces, is an essentially progressive phenomenon, which though subject to certain invariable laws derived from the nature of man itself, is built up in a gradual and progressive manner; since it begins in a rude state and rises gradually to the miracles of organization, which we witness to day, like the tree which, contained at first in the germ, develops only with time, and throws out its branches successively, it seems to us useful to consider it in its rudimentary and primitive state. This is the more important since it is not developed regularly, in the sense that its organization is equally advanced everywhere; it is, on the contrary, very unequally developed according to locality, and we find here and there, in places even far advanced in civilization, remnants of its primitive organization. —II. PRIMITIVE AND RUDIMENTARY CONDITION OF INDUSTRY. The condition of industry which we call rudimentary consists essentially in this, that the most varied functions are united in the same hands; that exchange is almost unknown, and consequently the division of labor also, which is induced by exchange. All those occupations, so numerous and diversified, which are carried on separately in society as it now exists, opening a field to so many professions or different careers, were then in a certain way mingled and confounded, in the sense that they were exercised in turn by the same individuals, though in a very imperfect and rude manner. Another distinctive trait of this primitive organization is, that a sort of intimate community existed in it among men, at least among those forming the same society, in such a manner that they performed the greater part of their labors in common, and made a direct division of the fruits of these labors. —We have tried to give an idea of this state of things in several articles in this Cyclopædia, especially under the word EXCHANGE; but we think it our duty, in order to preserve the connection of ideas, to recall it in a few words here. In order to find its traces it is not absolutely necessary to go back, as we have done previously, to the infancy of society, or to follow man in the savage state; we can find a more or less faithful picture of it, even to-day, wherever a small group of men live separate from the rest of society, or without ordinary communication with it. If, for example, we go to the remote frontier of the United States, we shall find here and there isolated farms, on which a small number of men, belonging in most cases to the same family, live together, and satisfy all their own wants themselves without contact with the rest of the human race. This picture of primitive society is not complete, it is true, but it is near enough to the type which it represents. No matter how remote these men may be from the great society of mankind, they do not cease to borrow from it largely: first, they obtain their arms from it, as well as most of the implements which they use in their labor. Besides, having issued from that society themselves, they took from it at their departure a portion of the enlightenment and acquired knowledge which it had accumulated for the use of all. This gives them a decided advantage over their savage neighbors. With this exception, they embody the type of primitive industry, in the sense that all labors necessary to their support are carried on by themselves, and all the functions of social life are united and concentrated in the little group which they form. —A truer picture of this primitive constitution of industry can be found, perhaps, in the lives of the patriarchs, as presented to us in the Scriptures. Abraham and his earlier successors lived alone with their families and their servants by isolated agriculture, and without ordinary contact with the rest of the world. These patriarchs, it is true, knew the use of money, which shows that exchange was practiced among them to a certain extent; but it is evident that they had recourse to exchange only at long intervals, in exceptional cases, and that in general they themselves supplied everything which was needed to satisfy their daily wants. In their activity, as in that of the farmers of the American border, all industrial labors were united, all social functions brought together, with this additional circumstance, that as the patriarchs recognized no superior authority to which they owed obedience, they held besides the functions of the government in their hands. —On considering industry in this primary stage we perceive clearly the intimate connection of all its branches. On close examination all the functions of social life are found there united, though many of them appeared only in germ. Around agricultural industry, which in a certain way formed the basis of the common labors, were gradually grouped manufacturing industry, commercial industry, the fine arts, which were not unknown there, as well as the labors which to-day form the appanage of the professions called liberal, including even the functions pertaining to public authority. Land was cultivated and flocks were raised; this was the chief occupation of the tribe an occupation altogether agricultural. But the fruits of the earth once gathered, it was necessary to prepare them for common use. It was necessary also to collect the wool of the flocks, to spin and weave it, to make garments for each one. This was manufacturing industry with all the distinguishing characteristics which belong to it, but closely connected with agricultural industry, of which it was merely the accessory, so to speak. Next, it was necessary to distribute all these products among the different members of the tribe; and what is this but the foundation itself of those occupations which constitute commercial industry? The fine arts were cultivated, even if only in the song and dance at leisure moments. Man observed the stars, while cultivating the earth, or watching his flocks; this was the beginning of science, which was connected with the advancement of the most common labors. At intervals, also, the properties of certain medicinal plants were studied, plants suited to the cure of certain diseases; medicine took its place side by side with the plow of the laborer. Arms were sometimes taken up in self-defense, either against wild animals, or against other enemies more dangerous, and the art of war was practiced by the same hands which were devoted to the arts of peace. Those who had committed crimes were judged and punished; and thus, in the midst of so many other labors the solemn functions of justice were performed. Finally, there was a government, a chief to direct, and agents to serve it, and a police of some kind. It is true, therefore, that in this small group, composed of so few men, all the essential functions of the social order were united. It was a small picture of the world, as it exists in its present condition; with this sole difference that, in the world of the tribe, all these functions were mingled, confounded, exercised by the same agents, while in the world of to-day they are separated and intrusted to different agents, without ceasing on that account to be united and dependent on each other, as much as they could possibly be the first day. We shall now see how, in consequence of the progress of exchange, all these elements, mingled at first, became detached from each other, and what the new order was which was established. —III. ORGANIZATION OF INDUSTRY. Exchange; division of labor; subordination of labors; money. In proportion as the number of exchanges increases, under the influence of causes which we have enumerated elsewhere (see EXCHANGE), a division of labor takes place, in the sense that each individual chooses a distinct occupation to which he devotes himself exclusively, leaving to others the task of carrying on those which he has abandoned. In this way the functions of industry, at first closely connected, and executed by the same hand, separate; the mingled elements become detached from each other, and a new organization is established with exchange and division of labor as essential bases. —The first general effect of this movement of division is to set free manufacturing industry, which settles into a distinct branch of labor, through separation from agricultural industry, with which it was at first confounded and of which it formed, so to speak, merely an appendage. We have seen that, in the primitive organization, agriculturists themselves prepared the wool of their flocks, or the flax which they had harvested, in order to turn them into clothing; just as they also produced every change required by the other products of the earth. This part of labor, which consisted in fashioning and working up all the raw products of the soil, in order to adapt them more completely to our wants, was at that time only a kind of accessory of the first; in appearance, as well as in reality, there was at that period but one industry: agriculture, with its dependencies. But gradually, in proportion as exchanges became more frequent, these accessory labors separated sharply from agricultural industry, where they were always out of place and imperfectly executed. They acquired a greater importance by the separation itself, and tended to constitute, under the name of manufacturing arts, or manufacturing industry, a perfectly distinct branch of industry which, feeble at first and in the infancy of society, now occupies a high position among civilized nations. We are indebted to it in general for the creation of cities; for it is the nature of the manufacturing arts, which are not, like agriculture, fastened to the soil, to associate in groups, to concentrate and form by their union those masses of population which are called cities. Once established, they become still more special, through separation into a great number of distinct branches. Exchanges consequently multiply more than ever, and by their increase lend a new importance to that other branch of general labor, whose object it is to facilitate exchanges, and which is known as commerce. At the same time several other labors, previously without distinct character and confounded in the general mass, are detached from the common trunk: labors of art, of science, those relating to government, the police, and in general all those which form the object of what is called at present the liberal professions. Thus, everything which was formerly united now tends to separation, specialty is introduced everywhere, and exchange, originally the exception, becomes the universal law. —Exchange and the division of labor are therefore the fundamental bases of the new organization of industry; to speak more correctly, they are the points of departure for every genuine organization. In truth, it can not be said that this primitive condition which we have endeavored to describe had really an organized industry. All these isolated groups of men appearing on different parts of a territory, each one working indifferently the tract of territory which fell to its lot, were too unconnected to exhibit any general order in their relations. They formed, perhaps, industrial workshops, but workshops without connection, without tie, among which, therefore, no trace of general organization could be noted; and as to the particular organization of each one of them, it was the ruder and more imperfect since the most varied functions of labor were mingled and confounded, and no assistance from without could be expected to favor its action; it was, besides, unstable, depending essentially on the changing views of those who directed it. It was only when exchange became more frequent, that regular relations were established between these workshops, and it was then also that general organization began to appear. This was completed by the division of labor, which freed each one of these workshops from the parasitic functions with which it was overburdened, confined it to its own specialty, and made every separate workshop an integral part of a great whole—An imperfect idea would, however, be formed of the general order of industry unless to these two essential conditions, exchange and a division of labor, a third and no less important one be joined, which completes them, namely, the connection, the mutual dependence in which the various functions separated by the division of labor are placed with regard to each other. To say, as is often said, that labor is divided in the progress of industry, is not enough; this is to omit another important phenomenon, which beyond a doubt has an intimate connection with that of the division of labor, but which in many respects is distinct from it, and would on this account deserve a separate title. We wish to speak precisely of this principle by virtue of which the various labors of industry, though separated from each other and executed independently, continue nevertheless in such a reciprocal dependence and subordination that they all seem to form the different links of an endless chain. Economists in general do not, perhaps, dwell sufficiently on this phenomenon, to which, as appears to us, they do not attach due importance. But what other phenomenon shows more clearly the elevated character, the eminently social character of industry, so different from that which so many unjust detractors attribute to it? In virtue of the division of labor, different kinds of labor are separated in view of more convenient and better execution; it might be believed that they continue thus without relations; nothing of the kind; once separated, they come together again, and are reconnected; without being confounded, however, as they were before, they are subordinated to each other, but solely for purposes of mutual support. There is not, therefore, a single one of the great functions of industry which is not connected with a thousand others, from which it obtains the materials which it works up, the instruments which it uses, the buildings which it occupies, or the technical processes which it employs. This is what we shall permit ourselves to call the subordination of labors; the necessary crowning of the division of labor, from which, however, it is distinct; an interesting phenomenon which characterizes, better than any other, this organization at once simple and complex, to which human industry lends itself. Another no less interesting phenomenon, which completes the foregoing, is the use of money, without which any active system of exchanges would be impracticable. —Exchange, the division of labor or the separation of tasks, the subordination of the different kinds of labor, and the use of money: these are the four essential elements which constitute the industrial order as it exists; they are the fundamental bases on which the whole edifice rests. It will be understood that this is not the place to dwell on these elements, which will be more properly explained elsewhere. It is sufficient for us to call brief attention to them, to assign them their proper place in the industrial system. Let us merely repeat that together they form the whole industrial order, and it is not necessary to go outside this circle to include the total of economic phenomena. It remains, however, to see what results from the action of these elementary phenomena, and how in the movement of affairs originated by exchange, order is introduced among all these industrial elements separated by the division of labor. —IV. CONSEQUENCES OF THE PRECEDING. The industrial world constitutes a great society. In the primitive state of things, a feeble sketch of which we have tried to present, there was, properly speaking, no human society; the world was divided into a certain number of isolated groups of close communities, little disposed, as a general thing, to come together, and between which a state of war often created a gulf. But when exchanges increased and the division of labor began, all these isolated groups dissolved, they became merged into each other, and finished by forming together a great society, whose tendency, as we shall point out in the article POLITICAL ECONOMY, is to become universal. This is human society, very different from political society, with which it is sometimes improperly confounded, and which is never greater than a more or less considerable fraction of it. —Now what are the bonds of this society? Precisely those which we have just enumerated: exchange, division of labor, subordination of the different kinds of labor, and money. By exchange, men supply each other with the fruits of their labors, products for products, services for services. By the division of labor, they share the different parts of a common task. This is enough to create between them a social tie so intimate that no human power can break it, and from which no individual can free himself. The subordination of the different kinds of labor strengthens this bond, which the use of money cements, by making it general. The existence of this great human society has often been denied or ignored. Some look on it merely as a promise of the future. They are mistaken; it is a reality of the present. This society exists to day, though it has not yet arrived at the last stage of its development, and continues to extend and multiply its bonds daily. Its existence is shown clearly enough, it appears, by that intimate solidarity of interests which becomes more and more evident, which is established especially between all parts of the civilized world, and which makes them all sensitive to the same accidents, to the same catastrophes. It is shown by the simple fact, that any individual hidden away in a corner of this civilized world may deliver the fruits of his labors to his neighbors, and, provided that he has them accepted, may receive their equivalent in any other part of this habitable world. He has worked for the French, the Germans or the Russians; he can be paid the price of his labor by Americans, Indians or Chinese. Its existence is shown further by this other no less significant fact, that nations most different from each other, not only agree to effect an exchange of products, but, in addition, aid each other in a certain way in completing the successive processes which certain products require, and bearing them by a series of uninterrupted labors to their final termination. Thus the cotton fabrics which we wear are the combined result of the labor of North Americans and Europeans; leaving out the fact that several other nations have contributed to their manufacture, some by furnishing dye-stuffs which color them, others by furnishing the instruments which were used in their manufacture. The wool of flocks raised by Australians is brought to Europe by English seamen; it is distributed by English merchants over the European continent; where it is converted into thread and cloth by German, Belgian or French laborers, dyed with stuffs furnished by Central America; again it is transported, in the form of manufactured cloth, by the sailors of every country, into every part of the world, including that in which it grew. Is it possible to fail to recognize in such movements the intimate community of interests which is established between the inhabitants of countries most different from each other, and the existence of a social bond which connects the whole world? —Our intention, however, was not so much to prove this great fact here as to mention it. We shall say simply, in passing, that it is just this human society, thus formed and constructed of the elements which we have just examined, whose laws are studied by political economists. It remains now to see what the principles and general facts are from which these same laws are derived. —V. MOTIVES AND REGULATORS OF INDUSTRY. Personal interest; supply and demand; competition. The great motive of industry is personal interest, which is besides the essential motive of all human actions. When God created animated beings he endowed them with a profound and indestructible sentiment: love of self, as necessary to their preservation. It is his will, however, that this sentiment, too exclusive, should be tempered in each individual by a more or less pronounced sentiment of sympathy for his fellow-men. This same sentiment, personal interest, love of self, imparts movement to the whole industrial machine; but it finds here an additional moderator, the balance of opposing interests, which confine each individual interest within its limits, and from this, final harmony results. —The pretense has sometimes been made of substituting another motive for this natural one: devotion to others. This was a desire to interfere in the work of the Creator, who assigned its place to each sentiment, when he admitted sympathy or devotion merely as a corrective. Suppose this project to have been successful (an impossible thing), its success would have merely enervated man, by depriving him of his most active principle. For what other sentiment can rival self-interest in energy and perseverance? What other, inherent in man from the cradle to the grave, could apply the same spur to his activity? Happily these absurd projects have never had a chance of success. Personal interest may sometimes be perverted or corrupted, by turning it from its path, but it can never be destroyed. —The great motive of industry is, therefore, the same which has determined human activity in all directions and at all times: personal interest. But it would be a mistake to suppose that from the movement and conflict of diverging individual interests anarchy or disorder must necessarily result. This would have doubtless been true in those systems of an absolute community of labor and wealth which existed at the beginning of human society, and which certain misguided minds have sometimes been bold enough to propose to us as an improvement on our present condition. With such an arrangement personal interest, without ceasing to be as active as in our present society, would be absolutely deprived of a rule of action: therefore it would become lawless at every moment through brutal violence, passionate disputes over places, by a rivalry of slothfulness in labor, and a culpable disregard of the service of the community, unless continually reproved, directed and restrained by the all-powerful and despotic will of a director. But this is not the case in the industrial system founded on exchange, in which order springs from the very principle in virtue of which society moves. As soon as exchange has become in practice the universal law, as each individual is forced to count on others for the satisfaction of his wants, and as he has no right to their services except in so far as he brings them to accept his, he is led by his own interest to labor for his fellow-men, to study their wants, their tastes, and to make the satisfaction of these wants the sole object of his activity. Thus, in this system, personal interest, without losing any of its native energy, tends unceasingly toward order, while subordinating itself in each of its manifestations to the interests of all. —In the midst of this extreme complication of phenomena, which exchange and the division of labor produce, there remain nevertheless certain grave questions to be solved, which touch upon the very existence of the industrial order; that of knowing, for instance, on what basis products and services are to be exchanged, and how equal values are to be established. This is the great problem of value. This problem is solved by the beautiful law of supply and demand, which has been explained before (see DEMAND AND SUPPLY), and by competition which is its complement. Let each man be obliged to offer his services to his neighbors, and have them accepted by those who demand them before being able to claim a part of the fruit of their labors in his turn; this arrangement suffices to make the personal interest of each individual tend to satisfy the wants of all the others; but it is inadequate to effect a balance and equilibrium between all the individual interests which are put in movement, and give to each one in a just measure the satisfaction due it. What would happen, for instance, if each individual, when he offered his products and his services to others, were able to fix his price arbitrarily according to his will? Another rule is needed. Where does it come from? The decrease of the demand suffices, in a certain measure, to moderate the claims of those who offer the supply; it is the commencement of a rule. But it would still be insufficient, if competition which grows up naturally between the latter did not impose on them a more rigorous law, by forcing them to be satisfied with the lowest price which the exigencies of production can admit. It is competition then, finally, which determines the relative price of things. It renders many other services, and in the last analysis it may be considered as the supreme regulator of the industrial world. But having already explained this truth, in some of its developments, under the word COMPETITION, we shall not return to it here. It only remains for us to do what we have omitted elsewhere: to determine the conditions of competition and the limitations to which it is naturally subject. —VI. CONDITIONS AND LIMITS OF COMPETITION. Interference of political authority; necessity and danger of this interference; natural monopolies. Such is the power of the principles of order which we have just mentioned, and especially of competition, that sovereign regulator of industrial affairs, that if the action of these principles were never opposed or limited, if it were not submitted to conditions which frequently distort its effect, all the functions of the industrial world would be carried on without trouble, and with perfect regularity. We have stated elsewhere that, if competition had always ruled without obstacle, if it could have fully developed in the midst of human societies, such is the power, the inexhaustible fruitfulness of this principle, that humanity would have advanced, and with an incessantly increasing rapidity, toward a future of prosperity, of wealth and of general well-being, of which it has perhaps yet no idea. More than this: the industrial mechanism, so admirable already, would be free from all the disorders which impede its action. —The action of competition supposes the reign of justice and right; it supposes that, in every operation of exchange, the contracting parties will be free to refuse or accept the conditions proposed them, and even to apply elsewhere if such is their good pleasure; it supposes, in a word, the absence of constraint, of fraud, of violence in human transactions; for if one of the parties may, in any manner, impose his conditions on the other without the latter being free to weigh, to measure and reject these conditions, there is no longer any competition, and equilibrium between the respective interests of the parties ceases to exist. Under the empire of the law of exchange, personal interests continually tend toward order, since no one can pretend to obtain values which he seeks, unless at the cost of furnishing equivalent values to his fellow-men, and of subordinating his labors to their wants. But it is always under this essential condition, that no one of these interests in question should prevail over the others through violence and injustice; that, on the contrary, each man should be bound to respect in all other men the free manifestation of their wants. Otherwise, the tendency of individual interests toward order immediately changes into a contrary tendency. Now, it is precisely this essential condition, this necessary condition of order, which is almost never completely realized. —In view of the evil passions of men, which but too easily incline to violence and injustice, when urged by personal interests, and when they have force on their side, justice and right can prevail in human transactions only so far as there is a superior power above individuals, which holds the balance between them, and which has both the force and the will to prevent all their deviations from justice; this is the political power, whose interference, understood in this way, is always necessary. The task of this power is a great and admirable one. It consists essentially in holding the balance between individuals, to make the liberty of each one of them respected, and to keep them within the limits of their respective rights, without speaking of the corresponding mission which is intrusted to it, of defending the population of the country which it governs against foreign attacks—a negative rôle, when properly considered, since it consists almost entirely in repressing violence and preventing evil, but which is nevertheless of considerable importance. It is owing to the continual interference of this power, an interference altogether salutary and beneficial when it does not exceed proper limits, that freedom reigns in private transactions, and it is in this case alone that competition becomes possible. If the political power is not the creator of the industrial order, whose principle lies elsewhere, it is at least its guarantee, and the necessary guarantee. Under its wing, so to speak, individual interests are secured, and competition gains its vigor. We can therefore consider the different political powers which divide the world between them as so many indispensable wheels in the great industrial mechanism. —But these political powers are exercised also by men who are no more exempt than others from the evil passions which it is their duty to restrain; this is the weak side of human society; it is the gate through which every evil enters. In addition to the fact that those who wield power in each country (we mean here governments in general) do not always show themselves sufficiently active in repressing excesses, and thus fail in their exalted mission, they too frequently permit themselves to commit like excesses. Subject to all the impulses of human nature, they often yield, like other men, to their evil inclinations, and the unjust acts which they commit at such times have consequences all the graver since they have a loftier origin. To find a government which makes justice respected and which respects it scrupulously itself, is the political problem, but a problem which still awaits solution. This is why the industrial system, in spite of its admirable structure and the regulating principles which it possesses, forced as it is to lean on the political order, which does not enjoy the same advantages, still finds itself tainted with a great number of partial disorders from which perhaps it will never be entirely exempt. —Thus in the industrial order, everything is good in so far as we consider it governed by the economic law; but this law, more general in its application than the political law, is nevertheless subject to it, in certain respects, within the territory embraced by the latter, since it is everywhere incomplete without its co-operation. From this arises disorder wherever disorder reigns; from this come the vexatious imperfections to which the industrial system is still subject. The mass of men have no reason to complain, since the primary cause of the evil is in the violence of their own evil passions. It must be said, however, that independently of this severe condition to which competition is subject, of being unable to act except under the protection and guarantee of the political powers, it meets also here and there necessary limits, which the nature of things imposes on it. —It is evident, to begin with, that competition can not act in all its completeness except when the number of men occupied in the field of industry is so large that each one of those who offer in bulk services of a certain kind should meet competitors or rivals. It is evident that where population is sparse, or the groups of men are few and far between, this beneficent principle is scarcely felt. It is almost entirely absent in that primitive condition of society which we mentioned above; and this is one of the causes which explain why progress is generally so slow in nascent societies. It only begins to exhibit all its effects when men collect on narrow spaces, or when among sparse populations means have been found to establish numerous and easy communications, which bring producers into contact with consumers. —But even where the population is dense, competition always meets certain limits, if nowhere else, in the existence of certain absolute monopolies which arrest its activity. We do not speak here of artificial monopolies, of those which the negligence of governments has allowed to spring up, or which they have by design unjustly established. We speak of natural monopolies, of those which are necessary, unavoidable, and which the most careful vigilance of the political power could not remove. There is in every country a certain number of this kind of monopolies; and though inevitable and necessary, they do not in general fail to produce certain disorders followed by pernicious effects. The first and most considerable of all these monopolies, the most unfortunate perhaps, but surely the most inevitable, is precisely that which is enjoyed by these same political powers just mentioned. In every country, the established government, whatever it be, acts alone in its sphere, and suffers no competition of any kind in the exercise of the functions intrusted to it. This is inevitable, we say, and results from the truths which we have just explained. Since in fact competition even between one individual and another is only possible on condition of equal freedom for the contracting parties; since it supposes, consequently, the existence of a superior power, which holds the balance of justice between the contracting parties, and forces each to respect the rights of the other, how could it be practiced with reference to a government which knows no superior, and which could accept one only by abdicating? Contracts are made between individuals under the guarantee of public authority which prevents violence; this is what produces freedom of agreements and makes competition possible. But under what guarantee can a contract be made between a government and an individual? There can be none. In this case the strongest carries the day and imposes the law. The strongest is the government, which, instead of bargaining, of discussing as individuals do in their affairs, dictates and imposes its conditions. This is what has been seen in all times and which will always be seen, since the nature of things has thus ordained it. —But if this monopoly of political powers is inevitable, it nevertheless produces very annoying results. Since they never feel the spur of competition, which alone is able to enforce activity, economy and order on men of whatever condition, all the governments of the world grow slack. Consider what really happens in every state, and you will see that of all industrial enterprises undertaken, the enterprise of government—and we can call it that—is, beyond comparison, the worst administered. There are doubtless differences between states, but they are merely differences of degree. Besides, these same governments always sell their services too dearly. The price of these services, not being determined by the general laws which determine the relative value of things, is arbitrarily raised, with no other certain limit than the resources of the people. We are not criticising one particular government or another, since, on the contrary, we are establishing a general law. We simply say it results from the very nature of things that the functions peculiar to governments are always badly executed and paid for at too high a price. It is another consequence of this same fact, that the remuneration of services rendered by governments always assumes a particular form, that of a tax or impost—an annoying form, for more than one reason, though it is, in some respects, inevitable. Taxes are nothing else in principle than the remuneration for services rendered by those who govern; but they are a remuneration which, instead of being voluntarily and freely paid like all others, is exacted and collected with authority by those who receive the remuneration. From this there results both an underhand resistance on the part of those who pay, and who endeavor by various means to escape from the burden imposed on them, and a want of equilibrium in the assessment of taxes, which scarcely ever are proportioned to the importance of the services received by each individual, and besides a considerable increase in the cost of collection, aggravated by the resistance of tax payers; without considering that the precautions taken to insure this collection almost always become serious hindrances to industry, and nearly as oppressive as the taxes themselves. —Thus from the natural monopoly which governments enjoy, it results that the functions belonging to these governments are badly executed, that their services are always too highly remunerated, though there are great differences of degree between them. Besides the natural monopoly of political powers, there are others, which always involve consequences more or less lamentable. But it is not our intention to enumerate them here, still less to analyze all their effects, this subject being specially treated, like all others, in its own place. It is sufficient here to point out the principle, in order to compare it with the other principles which govern the industrial world and indicate in what sense it modifies the action of this world. —VII. INSTRUMENTS OF INDUSTRY. In the preceding pages, we have passed in rapid review the series of great industrial phenomena, stopping only at the chief points. We showed first that industry, in its general expression, embraces all human labors, of whatever nature they may be. We then stated that when scarcely out of its cradle, this industry tended toward ordering itself by exchange, division of labor and subordination of the different kinds of labor, by the aid of money which favored their action; that thus organized it constitutes a great society, the tendency of which is to become universal; that its principal motive is personal interest, the same that directs all human actions, but subordinate in this case, in virtue of the law of exchange, to the general interest; that the great principle governing it, and from which all its laws spring, is competition, a principle both of progress and order, which directs it incessantly toward an organization more and more satisfactory and perfect. We added that if this principle reigned in the industrial world alone and without division, all would be for the best, and that the wealth or general well-being would be as great as the degree of civilization at which nations have arrived would permit; but that competition has its conditions and its limits, which arrest its action and neutralize in a certain measure its beneficial effects; that it is subordinated, for example, to the action of governments, which not being subject themselves to its influence, do not subordinate themselves to the general order; that it is, besides, limited by a certain number of artificial or natural monopolies; that this is the weak or vulnerable side of human society; that by this, that is to say, the irregular action of governments, and by the disastrous influence of monopolies, disorder is introduced into the world; and that this explains why the organization of industry, so beautiful and marvelous as a whole, still continues to be tainted with numerous imperfections. —We have in a certain fashion summed up all the economic truths in this miniature picture. It must be understood, of course, that each one of these truths would require lengthy explanations, necessary to illustrate and bring out all its applications, but which we refrain from making because they will be found elsewhere. There would be a lack, however, in this general picture, if we should pass over, without mentioning them, the instruments of industry, that is to say, the agents of different kinds which are of assistance to man in his labor. —Man does not labor alone; he calls to his aid, as far as possible, all the forces of nature, all the powers of the physical world. Among the instruments which he uses, some, created by his own hands, were slowly accumulated by saving; others, given by nature, were merely conquered and subjected by him. But all lend him a powerful aid, without which the most energetic development of his activity would remain comparatively barren. This is a great and general fact, which could not be omitted, and whose place it was necessary at least to indicate. —There is really no particular law to be established in regard to the instruments of labor. Considered in their general bearings, the principles which we have already laid down apply to everything, to the simple agents of labor as well as to men. Men and capital are subject to the great law of competition, which arranges and classifies all things, which fixes every where the value of services rendered. Everything is subject in like manner to the influence of monopolies, which are connected with things as well as with men, and everywhere produce the same effects. The only difference is in the applications, which still offer, it is true, a vast field of study, but into which we can not enter at present. But if there is no particular law to establish here concerning instruments of labor, there are at least a few observations to make—To begin with, it is not uninteresting to see what kind of assistance is furnished to man by tools and machines in general, how far they are necessary to the development of his productive faculties, and how their increasing multiplication raises the level of humanity every day. So far as various kinds of capital are particularly concerned, the accumulated fruits of the labor of man, it is of interest to see how they are formed and accumulated by saving; in what conditions this accumulation is quickest, and what are the circumstances which favor it most—an important subject in itself, with which many others are connected, which are not devoid of importance either. There is less to be said, it appears, about appropriated natural agents. As they are given by nature, they do not increase by saving: though saving almost always adds something to them by means of the capital which it connects with them. They are purely and simply conquests of man over nature, conquests which are happily extended from day to day. There is, however, an important observation to be made on this subject, it is that appropriated natural instruments are more subject to monopoly than capital, and to monopolies frequently complicated, whose effects are not always easily analyzed. As to agents not appropriated, however valuable be their aid, we may omit them entirely, since, their services being always gratuitous, they do not enter into the current of exchanges, and thus escape all the effects of economic law. —Moreover in all we have just stated, though here and there a glimpse may be had of a vast series of interesting studies, no new principle appears; at least none of those primordial principles, those generative principles, so to speak, like those which we laid down earlier in this article, and to the explanation of which we desired to confine ourselves. In fact, since the instruments of labor, those at least which are appropriated, follow, as we may say, the fortunes of the human race, and are subject, saving a few differences and restrictions, to the same general laws, what principle could be appealed to concerning them which would not be simply derived from these same laws? —VIII. CLASSIFICATION OF INDUSTRIES. Industry is one in this sense, that all its parts are connected, and that it would not be possible to suppress a single one of them without leaving an evident breach in the whole. Nothing, however, prevents our dividing it into several branches, for the convenience and facility of the studies of which it is the subject; there is no difficulty in doing this, provided the necessary connection of all the branches with each other is never lost sight of.—"There is but a single industry," says J. B. Say (Cours, part i., chap. vii.), "if we consider its object and general results; and there are a thousand, if we consider the variety of their methods and the materials on which they act. In other words, there is but a single industry and a multitude of different arts." Though J. B. Say takes the word industry here in a more restricted sense than that which we have given it, since he applies it only to that kind of labor which acts on matter, his observation is correct. It has even a higher significance than he gives it, and we can apply it to universal industry with the same authority. "Nevertheless," adds the same author, "it has been found convenient, in studying industrial action, to classify its operations, to unite in the same group all those which have a certain analogy among them. Thus, we say that the industry which brings products from the hands of nature, whether it has promoted their production, or whether that production has been spontaneous, would be called agricultural industry or agriculture; that the industry which takes products from the hand of their first producer, and subjects them to any change whatever, by chemical or mechanical processes, should be called manufacturing industry; and that the industry which takes products from one place to transport them to another, where they are nearer the consumer, should be called commercial industry, or simply commerce." This classification is, in fact, that which is most generally followed. It has passed from everyday language into books, and nothing prevents its adoption, since after all, as the writer we have just quoted very aptly says, every classification is arbitrary, having no other object than to direct study or simplify operations of the mind. Still, it is necessary to remark how insufficient and incomplete this classification is in certain respects. It comprises under the same denomination, that of agricultural industry, several kinds of labor, which have without doubt an analogy to each other, as all human labors have, but which surely differ for many reasons; for instance, the venturesome labors of the man who is engaged in whale fishing and the uneventful occupation of the laborer who cultivates his field in peace. The man engaged in the whale fisheries in the southern seas, would surely be astonished to learn that he exercises an industry similar to that of the gardener who furnishes the market of Paris with fruits or vegetables. On the other hand, how many industries remain outside of this classification, even it we give it every possible extension. We find here, for example, no place for the labors of scholars, physicians, advocates, artists, professors, public functionaries, nor for those of the men devoted to the professions called liberal; for all these men, each one of whom exercises an industry, and often a very active one, could not be considered as merchants, manufacturers or agriculturists. —Struck with these considerations and some others in addition which he has developed with much force, Ch. Dunoyer has endeavored to establish a new classification, more scientific and complete, in his excellent work, Sur la Liberté du Travail. He begins by dividing industry into two categories or two orders; embracing in the first category those which act on things, and in the second those which act on men. The industries which act on things, are: 1, extractive industry, that is to say, that which wrests from nature spontaneous productions, and in which must be comprised fisheries, the chase, and the working of mines; 2, the industry of transportation, that is to say, that industry which transports objects by land or by water; 3, manufacturing industry; 4, and last, agricultural industry. The last two, the author defines very nearly as they are defined everywhere. In the category of industries or arts which are exercised on men, Ch. Dunoyer includes: 1, those occupied in the perfecting of our physical nature; 2, those which have for special object the cultivation of our imagination and sentiments; 3, those whose office it is to educate our intelligence; and 4, those which contribute to the perfecting of our moral habits. This classification, more regular than the other, more satisfactory, perhaps, and surely more complete, has nevertheless the great drawback of not being usual, and not presenting, in the terms used, a meaning understood with sufficient ease; a serious drawback, especially in a publication like the present, which should, by the simplicity of its nomenclature, make itself easily understood at once by every one. Is Dunoyer's classification itself complete? Is it satisfactory, speaking in the language of science, in the sense that it comprises without distinction, while ranging them in their real order, all kinds of labor? We need not examine this question here; we shall merely say that, satisfactory or not, it may be considered at least, as a new elaboration of a subject which still leaves much to be desired—a rational, judicious elaboration, always very useful to consult. —Notwithstanding the relative merit of this classification, we are forced by the decisive consideration which we have just mentioned to return to the other. We adopt, then, the distinction established between the agricultural, manufacturing and commercial industries; but we would remark that this classification, which only applies to the great divisions of industry, does not comprise everything. In the first place we can not permit ourselves to confound under a common denomination agriculture, fisheries, working of mines, or even the chase, which we consider rather as special industries, and very important ones. It seems to us necessary, besides, to make another reservation in favor of the industries connected with the professions called liberal, which we have already enumerated. CH. COQUELIN. INDUSTRY, Agricultural.INDUSTRY, Agricultural. (See AGRICULTURE.) INDUSTRYINDUSTRY, Manufacturing. I. Next to the chase, which alone supplied the wants of man in a savage state, agricultural industry, which includes the raising of flocks as well as the cultivation of the soil, is the first to which man devotes himself; it is the original, the mother industry, which long continues to be the only industry of nascent peoples. Manufacturing industry appears only later, with the arts which complete and attend it. As its particular object is to prepare the raw materials furnished by agriculture, in order to make them more suitable to satisfy our wants, it naturally succeeds agriculture in the order of time, as it does in the logical order of facts; this industry, therefore, does not generally appear until the first advances have been made in civilization, and when there begins to be a surplus of field labor, in an already well-settled region. Not that we fail to find the first rudiments of manufacture in the very infancy of society, and even among savage tribes devoted entirely to the chase. It is not entirely unknown in any stage of civilization; the savage fashions wood and some other materials into a bow and arrows; he turns, in some fashion, the skins of beasts which he has killed, into clothing for his person; he pounds and rubs different dye-stuffs to color his face and his body; he makes an ornament or a distinguishing mark of the feathers of certain birds; and these are so many attempts at manufacturing industry—an industry still very rude, it is true, but which has already the distinguishing characteristics which it afterward maintains. In passing from this first stage, in which the chase is their only occupation, to the raising of flocks and the cultivation of the soil, men make a further advance: they use for clothing the wool of their flocks, which they learn to spin, weave and dye; they sometimes also employ for this purpose the fibre of certain plants, such as flax and hemp, of which they also make cloth. This is, it would appear, the result of an established industry. But in this condition of society, labors of this kind are not separated from agricultural labors, to which they are, so to speak, only accessory; they are carried on together with field labor, by the hands of those who cultivate the soil, and in the intervals of leisure which they have in these labors, it is less, therefore, a branch of distinct industry than an appendage of this primitive industry whose object is the cultivation of the soil. —In order that manufacturing labors should become detached from those of agriculture with which they are closely connected in the beginning, and form an industry apart, they must have acquired a certain importance and made some progress. For this purpose it is necessary that the agriculturist should have grown wealthier and consequently more exacting, so that, no longer satisfied with the rude garments which he can make himself in his leisure moments, or the rough instruments which he used at first, he prefers to obtain both from specialists whose only occupation is to make them. It is also necessary that the number of workers of the soil scattered through the country, and using manufactured products, should be great enough to furnish these specialists with continuous labor throughout the year. This supposes a more numerous population, more extensive wants, a more advanced civilization. Such progress is not made in a day; neither is it always made regularly nor in exactly the same manner everywhere; but it is necessarily the first step toward manufacturing industry proper. —When manufacturing arts are separated from agricultural labors, they are in the nature of things united and grouped. Since men occupied with these arts are not obliged, like tillers of the soil, to live scattered over the country, so as to be near the lands they cultivate, they can move their shops almost wherever they please; and as they have frequent need of each other, it is natural for them to unite, and associate in groups at certain given points. This is the origin of those collections of houses, which form at first villages, later towns, and finally cities. It is in cities that the manufacturing arts concentrate. We still find, it is true, even in our time, and in countries most advanced, certain great workshops scattered here and there in the country where there are special local advantages, either on account of water power, or some other cause, but it is none the less in the nature of things for them to be brought together in the cities. Manufacturing arts are best developed in cities through the aid which they lend each other, and the growth of public enlightenment; we see, therefore, that they tend continually to confine themselves to cities, or draw near them. This at least is the general rule; the contrary is, in every country, the mere exception. —If the separation of manufacturing labors from those of agriculture marks the earliest steps of civilization, it is far from being complete at first. Far from taking place suddenly, at a given moment, it is effected slowly, gradually, in a progressive manner, and often almost imperceptibly. It is, so to speak, the work of centuries. Thus, there is not yet a country in the world, even in the Europe of to-day, where it is complete. —Reduced to its most simple expression, agriculture consists in cultivating the earth in order to obtain, in a raw condition, the various products which it is capable of giving. Strictly speaking, agricultural labor proper stops here. All subsequent modifications given to these products, all changes to which they are submitted, may be considered as belonging, or capable of belonging some day, to one of the branches of the manufacturing arts. Now agriculture is far from being brought to this state of final simplicity in any country; on the contrary, it still retains possession of some of these processes or modifications which follow cultivation proper and the harvest; it is still only a question of degree according to the stage of advancement in each country. There are several of these processes, it is true, which it would seem should always belong to agriculture, because they can be conveniently carried out only on the spot; such as threshing wheat in the bundle to get the grain. —In some countries of Europe, the greater part of the spinning and weaving of flax and hemp is still carried on in the country, on farms, and thus continues to form a sort of appendage to agriculture. Not long since this was the case in all France, and is still so to a greater or less degree in a large number of French provinces. Nevertheless these two operations tend more and more especially since the invention of machinery, to leave the country, to abandon the farms for the industrial centres. In England especially (we speak of England proper, leaving out Ireland), this separation is almost complete. But this is not true of retting and hackling, which continue to belong almost everywhere to rural industry. It is easy to foresee, however, that they will be detached from it sometime. Even now in some parts of Belgium, where flax culture has reached the highest degree of perfection, it is nothing rare to see a farmer sell his crop of flax standing, or after it is pulled, to persons who make retting and hackling a specialty. It is true that these persons still work in the country, for the most part, because the present conditions of retting demand it; but suppose that the question of retting by chemical means, which has been so much studied and the solution of which is so desirable, should be finally settled, we may believe that this operation, as well as hackling, would be soon separated from rural industry, to extend, with so many others, the domain of city industry. —II. Thus it is that, in the succession of ages, in proportion as progress is effected, manufacturing industry increases and extends by detaching each day some one of the branches of this mother industry from which it sprang. Agriculture, which was complicated in its origin by a great number of operations, foreign to its nature, frees itself gradually from these parasitic functions; it leaves them to the workshops of cities, to which they belong, to confine itself more strictly to its special functions, the improvement and cultivation of the soil. The causes which favor this movement are the same which determined it in the beginning: the progress of arts, the increase of wealth, and, above all, the increase of population in a state of civilization somewhat advanced. In order that the separation between the manufacturing arts and agriculture should continue to grow more definite, it is necessary, above all, that exchanges between the city and the country should be easy, so that the agriculturist may always transport to the city, without too much trouble, the raw products which his industry gives, and obtain the finished products which he consumes. If numerous ways of communication contribute to this facility of exchanges, which is not doubtful, this same facility also demands, we can see, a dense population, which increases one number of towns and cities, so that they are never too distant from every part of the country. —Of all the countries of Europe, and probably of the whole world, England (we always speak of England proper) is that in which the separation between the manufacturing arts and agriculture has made most progress; it owes this advantage to its wealth, its enlightenment, the number and perfection of its roads and canals, but, above all, to the density of its population. With an amount of wealth almost the same comparatively, with as much enlightenment in the masses of the people and a very considerable development of roads and canals also, North America is in this respect much less advanced, because its population is scattered over a great extent of territory. In England, where the agriculturist is exclusively an agriculturist, agriculture is reduced, or nearly so, to its most simple expression; and this explains an interesting phenomenon which has often occupied men's minds, without their referring it, so far as we know, to its real cause, which is the numerical inferiority of the agricultural population of England, compared with that of all other countries English agriculture, it is said, is enormously productive, much more, in proportion, than that of any other country, especially France, and still it employs fewer men, which is true: whence it is concluded that England has acquired an immense superiority in agricultural processes. The superiority of English agriculture is real, no doubt but not to the degree which seems to result from these comparisons. English agriculture employs fewer men in a greater production, because the work is simpler, that is to say, freer from foreign elements; because the men it employs are occupied only in performing special functions, the improvement and cultivation of the soil, while elsewhere the same number of men is divided among a great number of different kinds of labor. —It is sometimes asked whether the removal into the cities, of the manufacturing arts which previously formed an appendage to agricultural labor, is in itself a good or an evil. If this question be considered in a general way there can be neither hesitation nor doubt on the subject. The separation of manufacturing labors from those of agriculture is the beginning and the point of departure of that division of labor which forms the wealth of civilized nations, and which has so greatly increased the power of man, it is the first condition of progress; we might say it is progress itself. To ask whether this separation is a good one, is in other terms to ask whether civilization is superior to barbarism. But that it should be really favorable, it must be produced under normal conditions, that is to say, slowly, progressively, and under the influence of those natural causes which determine it everywhere: otherwise it may become really the occasion of cruel suffering and fatal confusion. The reason for asking if this removal is not an evil was, no doubt, because in our day it has sometimes taken place suddenly, and violently, under the influence of artificial inducements and restrictive laws. —III. In proportion as agricultural industry is freed from the foreign elements which complicate it, it acquires more energy and power. The cultivator of the soil, whose attention was at first divided among a great number of different labors, turns it entirely to those which belong to him; he devotes himself solely to the cultivation of the earth, and invests in this all the capital which he can command. Thus the soil, being better and more diligently cultivated, yields much more on a given space, though a smaller number of laborers may be employed on it. But manufacturing industry gains most from this separation. So long as it is scattered, so to speak, among rural occupations, it is necessarily imperfect, rude, and besides incapable of any connected progress. How in fact could field laborers, whose first care is cultivation, and who become manufacturers only in moments of leisure, producing for a limited consumption, sometimes one object, sometimes another, give to everything they touch the time and attention necessary to bring it to perfection? Should they become skillful, which is not possible, they would be stopped in the way of improvement by the single fact that they could use only imperfect materials in each one of these divided manufactures. In these conditions, therefore, the manufacturing arts are forced to remain stationary. It is only when freeing themselves from the restraints of agricultural industry, and taking up their abode in cities, they commence their upward and progressive movement. Scarcely have they settled in the cities when they assume a new character. The men who carry them on being now in a position to see each other daily, begin an exchange of ideas, and each profits by the advance of general enlightenment. These arts thus brought together and grouped, are soon arranged into classes. Labor is divided. Each one chooses a specialty to which he devotes himself. He becomes more experienced in it, more skillful in everything relating to the execution of his daily labor, and especially more apt to perfect his labor of the application of new processes. For the same reason he is no longer obliged to scatter his capital; he applies it all to this single object, with the greatest success, since he supplies a great number of consumers; and therefore devotes more complete material and a greater quantity of it to its special manufacture. These are not the only advantages which the manufacturing arts gain by going to cities. To them should be added the development of credit, greater where population is massed, the relative ease of the circulation of products, and, above all the instruments of labor, the mutual assistance which the arts lend each other and which becomes for them, especially in certain branches, a daily necessity; but we have said enough to make it clear that their concentration in cities is for them the principle of progress. —All this does not mean, and we have already said so, that in certain given circumstances manufacturing establishments may not be situated here and there in the country, to make use of particular advantages, such, for instance, as a water power, a coal pit, a mine, etc., without giving up, on this account, the benefit of progress. Properly speaking, when establishments of this kind are indeed special, that is to say, devoted to a single manufacture, even if they are scattered through the country, they belong rather to city than rural industry. They share, like all the others, in the general movement. Still it is necessary, even in this case, that they should maintain constant relations with the cities. —The more manufacturing industry, considered in all its branches, is freed from the restraints of agricultural industry, the more active and powerful it becomes. Those luminous centres which it creates in cities are the brighter for being composed of a greater number of rays. When a particular manufacture is detached from rural industry, in order to join the groups already formed in the cities, it not only acquires a new force from its contact with the others, but it brings a new contingent to the common centre. A sort of fermentation takes place among these industries thus united and grouped. They continue to be classed, and divided, becoming more specialized every day, not only by reason of the absolute number of various operations which they embrace, but in a much greater proportion. Taken together, they gradually reach an incomparable degree of power, owing to their increasing subdivision, and the mutual assistance which they give each other. —IV. The country pre-eminently manufacturing is, therefore, naturally that in which manufacturing arts are most completely separated from agricultural industry. In such a country the industrial system develops in its greatest fullness and exhibits the faculty of progress in the highest possible degree. And as, on the other hand, of all the causes which favor this movement of separation, density of population is beyond contradiction the most powerful, it seems we may conclude a priori that, all other things being equal, the sceptre of manufacturing industry should of right belong to the most populous country. —Moreover, this conclusion obtained from theoretical data alone is not disproved by experience; on the contrary, facts are generally at hand to confirm it. Of all European countries, England is surely greatest in manufactures, and it is also, in proportion to the extent of its territory, nearly the most populous. With regard to the continent of Europe, it may be said that it is more or less devoted to manufactures in proportion as it contains on a given space a population more or less numerous. On the other hand, the United States—the rival of England in so many regards, almost equaling it in wealth, and surpassing it in some respects in prosperity and well-being—presents the most striking contrast to it on the particular point with which we are concerned. Its manufacturing system is comparatively as undeveloped as England's is advanced. And why? Because its population is scattered over large spaces, especially in the regions of the west. This sparseness of population has not allowed the manufacturing arts to separate from agricultural industry so completely as elsewhere, and this is the reason why these arts have not kept pace in their development with the general progress of wealth. To this consideration is added another no less decisive. So long as populations, scattered over a considerable extent of territory, find themselves at ease in the territories which they occupy, and land is not wanting to their labor, they have a natural tendency to devote themselves by preference to agriculture, and they do so almost exclusively, merely adding, as we have just said, certain rather rude manufacturing labors to agriculture. This is especially true when they can dispose of the surplus products of their lands abroad and obtain in return the manufactured articles which they do not make themselves. But when these populations once begin to press upon each other, and grow dense on a limited territory, and agriculture no longer suffices to occupy them all, they naturally seek a new object for their activity elsewhere. This they commonly find in the practice of the manufacturing arts. These arts then develop with an irresistible power; they increase and improve in proportion to the amount of activity, and as in such a case they do not delay in finding a market for a good part of their products abroad, they discover in this extension of the markets which they open, and in the growing division of labor which is the natural consequence of this, a new means of improvement and progress. —These observations so simple, and yet so fruitful in consequences, destroy many systems. They relieve us from searching so far away, as is sometimes done, for the reason of the manufacturing superiority of one country over another. Wealth being equal, this superiority is essentially connected, we find, with the relative density of population. Other circumstances may no doubt concur in this result, but it is none the less the first and ruling cause. This does not mean, as is sometimes supposed, that the most populous country should secure the monopoly of manufacturing industry, for such a monopoly belongs to none; but it does mean that it should occupy the first rank, according to the natural order of things. For the same reason, all other countries will have a rank in the development of their manufacturing industry answering to the relative density of their population. Next to England, for instance, will come France and Belgium; then, certain German states and Switzerland; and, at last, on a decreasing scale, the almost uninhabited regions of Russia and South America. On this point notable differences will be observed in the same country in going from one province to another, according as the population is more or less dense. Lancashire, for example, so rich and, above all, so populous, will be found far superior in manufacturing development to all the other counties of England. In France, the departments of the north, and of the lower Seine, without mentioning the department of the Seine, will be found superior, for the same reason, to all the other departments of France. Finally, in the United States, the eastern states which have been longest settled, and for this reason are the most populous, will be found the only ones in which the manufacturing arts have acquired any power, while the western states, which are younger, are almost entirely strangers to them. It may be said, it is true, that if the density of population acts on the development of manufacturing industry, the growth of this industry, favored by certain local circumstances, influences in its turn the increase of population. Thus the effect would react on the cause and become a cause in its turn. Who knows even, it will be said, if we shall not invert the rules here? Is it by reason of the relative density of its population that Lancashire is superior to all the other provinces of England in the manufacturing arts? or is it not rather to its manufacturing superiority, itself due to other causes, that we must attribute the relative density of its population? Does it not owe this superiority to the exceptional advantages which it has enjoyed for so long a time; to the wealth of its coal mines, and the ease of working them: to the great number and convenience of the water-ways which furrow it; to the neighborhood of the port of Liverpool, so convenient for supplying raw materials and for the exportation of manufactured products; finally, to the relative freedom which a number of its industrial cities have enjoyed, having been freed from the brutal tyranny of trade corporations earlier than others? These doubts are well founded, and we are far from denying all their force. Applied to certain restricted localities, the observation may even be found strictly correct. But it is none the less true that density of population, to whatever cause it be due, and it may come from the age of the nation alone, is one of the necessary conditions, we may even say the first and essential condition, of the manufacturing superiority of a country. The advantages of situation, which Lancashire enjoys are not so peculiar that other places do not share them. They may be found, for example, in the United States a region where the coal mines are not less rich nor less easily worked; where navigable highways are not less numerous; where industrial freedom is as great; where credit, another source of activity and power, is as great; where this other advantage is found which Lancashire has not of having the raw material near at hand, without the manufacturing arts having as yet attained the same activity. It is because the United States, a new country, has not had the time, in spite of the real advantages which it enjoys, to be covered with a population equal to that which is crowded into the regions of western Europe occupied since ancient times. It will have this population some day, perhaps, and then, but only then, will it be able to rival Europe in the perfection of its manufactures. In contrast to the United States, China enjoys almost none of the advantages which Lancashire possesses, save, perhaps, the number and extent of its canals. It has no coal mines, or it does not know how to use them. The resources of the mechanical arts, which contribute so much to increase the industrial power of Europe, are almost unknown. China has no idea, it appears to us, of the marvelous power of credit; and a deplorable policy, followed for a long time, of refusing all regular communication with other nations, deprived its industry altogether of the active stimulus given by foreign competition, and of that increase of vigor received from the increase of markets. Notwithstanding this, the Chinese people are superior to the Americans in nearly every branch of the manufacturing industry, except the mechanical. They are even superior, in many respects, to the English people, whom they surpass at least in the ingenious subtleness of their processes and the perfection of their workmanship. And to what circumstance is this superiority, otherwise so difficult of explanation, to be attributed unless to the extraordinary density of the Chinese population, which has increased and multiplied upon the same territory during a long succession of centuries? So true is it that this is a ruling circumstance, and that it triumphs even over obstacles of various kinds which a nation may meet. —What has not been tried to invert this natural order of things? What systems have not been imagined and put in practice? All the governments of Europe, struck with the prestige which manufacturing industry gives countries where it is exercised, and even attaching an exaggerated importance to the possession of this industry, have tried to anticipate its appearance, by enforcing an artificial activity upon it within the limits of their respective states. They first acted by means of tariffs, drawn up in such fashion as to favor the importation of raw materials, and to hinder that of manufactured products, in order to assure for their own manufactures on the one hand the exclusive advantage of the home market, and on the other, a greater or less advantage over foreign markets. They did more; they encouraged and excited the manufacturers of their countries by exceptional favors, by advances of money or prizes. Vain efforts! The superiority in the manufacturing arts remained where the nature of things put it, that is to say, in the midst of dense populations, whose activity could not find sufficient employment in the cultivation of the soil. Was there at least success, by all these artificial means employed, in hastening the advent of industry one step? On the contrary, we might venture to maintain, though we do not intend to insist on this side of the question, we might make bold to maintain, we say, that by these means their progress has been retarded rather than hastened; and if anything might have hurried the course of time, it is much less the artificial activity forced on them, than the enjoyment of a perfect freedom. Beyond a doubt, certain manufactures may be raised up here and there before their time by exceptional favors, prohibition or subsidies, but to make them prosper is another thing. And at what a cost have these sickly establishments been maintained! At the price of heavy sacrifices by the country; at the price of a harmful misdirection of capital, which was withdrawn from more fruitful investments in which it was employed; finally, at the price of a relative decrease of agriculture. In reality there was no success, therefore, in this method except a success in lessening the natural resources of the country, in checking the increase of population, and in retarding, after all efforts, the natural advent, the final and really fruitful advent of this same manufacturing system so much desired. —V. We have no desire, however, to belittle what the development of the manufacturing arts adds to the brilliancy, the greatness and the power of the civilization of a great country. The manufacturing arts contribute more than any other power to attract and fix in industrial centres the liberal arts and positive sciences whose promoters they are, and whose co-operation they require at every step. By the uninterrupted communication which they establish among men, they favor the progress of enlightenment in every direction, and by this greatly contribute even to the advancement of agriculture to which they seem foreign. To them, and to commerce which assists them, we owe most of the works of public utility, roads, canals, railroads, harbors, and great monuments of architecture. A German writer, whose name has gained a certain celebrity on the other side of the Rhine, has developed, in a work, otherwise of no great real value, this thesis successfully, though he has almost everywhere exaggerated the truth and drowned just conclusions in the floods of an exuberant imagination. However this may be, we can agree with Fr. List, that the development of the manufacturing arts is one of the most powerful motors of progress, nothing perhaps contributing so greatly to the growth of civilization in all its aspects. But should we conclude, with this writer, that we ought to force this development and endeavor to produce it prematurely by artificial means? Certainly not; for in addition to the fact that such an attempt would certainly fail, it would, we repeat, postpone the realization of its object. —On the whole, a dense population is in some respects a great disadvantage for a country; the raw products of the soil are generally more costly there than elsewhere, and living more difficult. As a compensation for this disadvantage, it seems to be the will of Providence that densely populated countries should have a natural superiority in enlightenment, civilization and industry, which serves as an offset to the relative drawbacks of their situation. Is the compensation sufficient? We shall not examine this question here; but we can not deny its existence. To undertake the reversal of this law of Providence, by guaranteeing to a new and thinly settled country all advantages at once, is a chimerical and foolish project. —VI. It will be understood, after a proper consideration of what we have just stated, that it is the nature of the manufacturing arts to extend their domain incessantly and to acquire in time a relatively greater importance. Though agricultural industry is not absolutely stationary, though, like all other branches of human labor, susceptible of progress, still it has its limits, marked both by the extent of territory under cultivation, and the number of its productions; the field of manufacturing industry, on the contrary, is limitless, and the number of its productions infinite. "That part of agricultural industry," says J. B. Say, "which is devoted to the cultivation of the soil, is necessarily limited by extent of territory. Neither individuals nor nations can make their territory greater than it is, nor more fruitful than nature wished it to be, but they can increase their capital continually, and consequently extend almost indefinitely their manufacturing and commercial industry, and in this way multiply products which are also wealth." (Cours, part i, chap. viii.) In every country marshes can be drained, wild lands brought under cultivation, greater fertility imparted through cultivation to lands already tilled, but the number of these improvements is not infinite; an impassable limit is always met in the extent of the territory occupied. In like manner, the number of the products of the soil may be increased with time; in addition to the fact that this increase is itself limited, it is to be remarked that the cultivation of one of these productions of the soil necessarily encroaches on that of the other. In manufacturing industry, on the contrary, in which immense values can be produced on a very small space, by the aid of a large amount of capital, there are really no limits to production except the amount of capital and the number of wants. The variety of its products also is unlimited. It is therefore, we repeat, in the nature of things that manufacturing industry should increase in importance, in proportion as civilization progresses: while agriculture, without losing its rank of mother industry and feeder of nations, tends nevertheless to descend to the level of those which it ruled so long. —This change of position, evident in history everywhere, becomes especially striking when we compare the old condition of the nations of Europe with their present state. Consider, for example, what England was in the time of the Norman conquest and what she is today. She was then an almost exclusively agricultural country. The agricultural interest, the agricultural movement, dominated everything. A simple appendage of agriculture, manufacturing industry occupied a very humble position at its side, and was scarcely counted in the balance of the nation's interests. Consequently it arrested the attention of the sovereign but rarely. Several countries of continental Europe were more advanced in this direction, especially Italy, the Netherlands and some provinces of France, where from that time forth a certain number of cities were found which gave a rather striking activity to manufacturing industry; but even in those countries the agricultural interest had a visible preponderance—It is generally said in all the legislative assemblies of Europe, in speaking of each country separately, that agriculture is the great business of each country, in particular that agriculture is its predominant interest. This statement is often repeated in France; it is made even in England, and, for stronger reasons, in other countries. It may be there is right on both sides. But it is a remarkable sign of the times that it should be necessary to put forth and defend propositions of this kind, which formerly were so strikingly self-evident that the contrary could not even be conceived. These propositions alone prove that a certain change of front is gradually going on, and that the time draws near when manufacturing industry will occupy decidedly the first rank in the most advanced countries. There is no reason to complain of this. The relatively higher position which manufacturing industry occupies, is the most evident sign of a growing civilization. In the earlier ages of the world, when men were satisfied with the roasted flesh of animals as their only food, and their rough skins as their only clothing, with a hole in the ground or a hut made of mud and reeds or sticks as their only dwelling, it is quite clear that manufacturing industry had little to do and occupied but a small place. It is quite as clear that manufacturing industry occupied a greater place in proportion as the human race required better food, lodging and clothing, and raw products of the earth needed, in consequence, a more complicated and skillful manipulation. —VII. To obtain a correct idea of the importance which manufacturing industry has acquired, in civilized societies, we must not examine it merely in great establishments which are commonly called manufactories. It is far from being in these places in its totality. On the contrary, it is rather to be found in the infinite number of shops of the second or third order; in those of small manufacturers, artisans, of the men of all trades. Shops that are inconsiderable, when each is taken alone, are so superior to the others in number that when taken together they exhibit an amount of labor far beyond that which is executed in the great manufactories. "All labor," says J. B. Say, "expended on purchased material, even when it is fashioned for one's own consumption or that of one's family, may be classed with manufacturing industry. The mother of a family who spins flax or knits stockings for herself or her children, carries on a manufacturing industry. A tailor is a manufacturer, since the same quantity of cloth has a somewhat greater value when it is cut and sewed into clothing than it had before. A locksmith, a bookbinder, are manufacturers; a baker, a pastry-cook, the keeper of a restaurant, are also manufacturers, since they purchase provisions and by a certain process render them fit for our use, and thereby increase their value. In cities manufacturing labors are carried on in every story of every house. In one place, buttons are made; in another, snuff-boxes; in a third, the links of a watch chain are made and put together; in a fourth, gloves are made or shoes bound. The perfumer plucks rose leaves; the apothecary pulverizes drugs; the optician polishes eye-glasses. All these labors are of the same kind, whether performed on a grand scale, in vast workshops where two or three hundred men are at work, or on a small scale, by the chimney corner." Much more subject to the division of labor than agriculture, manufacturing industry is usually divided into an infinite number of branches, so that it is nearly impossible to follow it in all its subdivisions. —VIII. Like agriculture and commerce, manufacturing industry has had serious difficulties to overcome at various times, without speaking of the natural difficulties connected with its own task. It has met the resistance of man and of things, especially in the imperfections of civil and political laws. If commerce has often been trammeled with artificial barriers, such as tolls, home and foreign tariffs, etc.; if agriculture, on its part, exercised all through the country, undefended, was more exposed than any other branch of human labor to exactions, violence and brigandage of every sort; manufacturing industry had to suffer also from many kinds of oppression. Despised and abased in antiquity, left almost entirely to the hands of slaves, it was generally trampled upon by governments and citizens. In the middle ages, though preserved in a certain measure, by the walls of the cities where it took refuge, from the exactions, the robbery and the despotism of the lords, it had to endure the almost equally brutalizing yoke of trades corporations. Later, it had still to struggle, particularly in France, against manufacturing regulations. It was in spite of these obstacles that it grew, and rose to the point at which it has arrived. —IX. Some are alarmed at the increasing predominance of manufacturing industry, to which they ascribe the greater part of the evils which afflict modern society. They are especially alarmed at seeing populations concentrate as they do in cities, and gather in great masses, whose existence seems often precarious, and who even sometimes become dangerous to the public peace. It would be better, they say, for this multitude to remain scattered through the country, devoted to the labors of the field, which would procure them a more assured existence and a better morality. Crowded together as they are in cities, they grow corrupt by contagion. Moreover, there is nothing less certain than the refined labor which the manufactories in cities offer them; generally better remunerated than labor in the country, it is more precarious, and the manufacturing industry is not seldom seen to abandon in distress and give over to despair the mass of those it has supported. —Those who reason in this way forget, first of all, that there is no choice to be made in this question the relatively greater concentration of population in cities is the inevitable consequence of its increase. We have already stated that the field of agriculture has its limits; it has its natural limit in the extent of territory, in the possible extension of cultivation. Now, when population, by increase, has exceeded its limits, what is to become of it? Would it be convenient and profitable, would it moreover be possible to detain men in the country when they could no longer find employment there? True, it is sometimes said that masses of unemployed laborers are crowded together in the cities, while the country lacks laborers; but this is a mistake; these words are generally in the mouths of those who use ready-made phrases, and repeat them blindly, without examination. This state of things is impossible in principle, and does not exist in fact. The influx to the cities is the surplus of the country, nothing more; sometimes even the reflux is not so rapid as is necessary to maintain the just equilibrium of functions and forces, because the domestic hearth has its charms and the native village its attractions, and neither is abandoned without effort. This is proved by the single fact, that in ordinary times the wages of labor are less in proportion in the country than in the cities. There is a mistake, therefore, on this point; it is forgotten also that men multiply chiefly in the country; therefore, whatever may be said and done, is not the influx of the country population to the cities a necessary and inevitable movement? It is necessary also that this population should move toward the cities in greater numbers in proportion as it increases, because there at least manufacturing industry opens up to it an indefinite field of labor. —Is it true, on the other hand, that this labor is more hazardous, more subject to chance, than field labor? It is true, in fact, that in many branches of manufacturing industry, production has its intermissions, its moments of activity and languor; most economists have made this remark. Manufactured products which mainly answer to change in taste and fancies, are more subject to the fluctuations of demand than agricultural products which answer more to constant wants. When, however, it is merely a question in the tastes or the fancies of consumers, the evil is generally not so serious, because capital and labor are transferred without much trouble, whatever may be said to the contrary, from one kind of production to another, and the damage resulting from displacement is generally compensated for in advance, by the relative increase of wages and profits. What is more serious is this, that there is sometimes a general stagnation of production in manufacturing industry. "There are," as J. B. Say justly remarks, "periods in a country where manufacturing industry is highly developed, in which there is no movement of labor, and when the whole laboring class suffers." (Cours, part i., chap. xviii.) In practice, nothing is truer than this. But we believe there is a mistake as to the ordinary causes of these stagnations of labor, when they are attributed to the uncertainties peculiar to manufacturing production and industry itself. However variable the tastes and wants may be to which this industry answers, they may be quite constant enough when taken together, unless other causes foreign to industry suddenly disturb production and labor. We have pointed out some of these causes under the heading COMMERCIAL CRISES (which see): there are also other causes in the uncertainty of political movements. Manufacturing industry, therefore, is unjustly blamed for those fatal crises which descend upon it without provocation on its part, and of which it is merely the earliest victim. —We will admit, however, that when these calamities come they affect field labor less than the labor of cities, because the first answers more to wants which can not be put off. But if manufacturing industry and commerce find causes of suffering in the irregular movements of political bodies, and the defective constitution of credit which affect them more directly, agriculture has its causes of suffering also, and perhaps more incurable ones, in the uncertainty of harvests and unfavorable seasons. A failure in the vintage threatens the existence of rural populations in the south of France, and a failure in the grain crop has more general and not less disastrous effects. If the sufferings of these people are less noticed it is perhaps only because being scattered over great spaces their complaints are less audible. —X. There is, besides, a general consideration which dominates this whole subject. It is this, that the concentration of a great manufacturing system in cities is the best guarantee, we might even say the only guarantee, of the tranquillity, the security and the liberty of the country. It has often been said, with justice, that manufactures nourish and vivify agricultural labor, because they absorb its products. Nothing could be truer. But it might be added, with no less truth, that the manufacturing population collected in cities are, with regard to the inhabitants of the country, vigilant sentinels who watch for them, advanced corps who defend them. Is it believed that the inhabitants of the country in Europe have always enjoyed the comparative liberty which is assured them to-day? Has their labor always been as regular, and their existence as peaceable? No matter how little any man has studied history, he knows that they have not. Now these populations have not risen to this superior position which they occupy without effort and trouble. Let us add that they have not won this position by themselves, and that they owe it above all to the manufacturing and city populations, which opened up to them in so many directions the way of civilization and progress. This remark is not a new one. It was made by Adam Smith, who himself borrowed it from Hume. "Commerce and manufactures," says he, "gradually introduced order and good government, and with them the liberty and security of individuals among the inhabitants of the country, who had before lived in an almost continual state of war with their neighbors, and of servile dependency upon their superiors. This, though it has been the least observed, is by far the most important of all their effects. Mr. Hume is the only writer who, so far as I know, has hitherto taken notice of it." ("Wealth of Nations," book iii., chap. iv.) An important result indeed, and which would suffice to destroy all the critical observations which the development of manufacturing industry has occasioned, by compensating richly for the real or supposed evils which this development may produce. Even if we consider the marvelous activity of manufacturing industry in modern times, we need not ask if the extension of industry has not been attended by some evils. We need not trouble ourselves to learn if in the present state of things manufacturing industry is as sure and as profitable as agricultural labor. We must ask, first, if this increase of manufacturing industry was not inevitable; then, if, in spite of partial suffering which it engenders, or which we wish to attribute to it, it has not produced a greater general benefit. In other terms, if the general condition of the human race is not to-day, owing to this same increase of manufacturing industry, greatly superior to what it was formerly. Thus stated, the question will be quickly solved. (See FREE TRADE.) CH. COQUELIN. INDUSTRY, Progress of.INDUSTRY, Progress of. In political economy this expression ought to be understood as the improvement of all the conditions on which the power and productiveness of labor depend. To appreciate correctly the magnitude of the results which we owe to industrial progress, as well as to distinguish with certainty the general characteristics which mark it, thought must go back to man's primitive condition, and the attention be given for a little to the principal industrial achievements which, in the course of centuries, have gradually brought about the present condition of things. —The immense multitude of different kinds of matter and force, of organized and living creatures which compose the terrestrial creation, was not, from the beginning, more particularly appropriate to our existence than to that of most other animate beings, but we received, more than they, the faculty of altering extensively, of completing in some sort to suit our own needs, the primitive creation, and thus only is it that this world has really become man's domain. —It is to the successive developments of this faculty, too little thought of, that we owe all the means of existence and of well-being accumulated by our race—means which have permitted it to multiply to a thousand times greater extent than it could have done had it been compelled to subsist on the spontaneous productions of nature. To this faculty do we owe our success in changing completely, to our own advantage, the original proportions of the different species of living creatures; in substituting for the forests and plants which covered a great part of the earth irrespective of their suitability to our wants, those that might prove most useful to us; in arresting the increase of numerous species of noxious creatures; and in subduing and then multiplying at will all such as were of a nature to be useful to us. It is also by the more and more extensive employment of this powerful faculty that we have succeeded in fertilizing large tracts of desert, in drying up large tracts of marshy land, and in making the watercourses nourish our crops, move our machines, and transport us and our products; that we are enabled to extract from the bosom of the earth the shapeless metals destined to become the instruments of our labor and of our exchanges, the coal which we use in our homes and our manufactories, and from which we distill the inflammable gas which gives light to us in the night; that we can quarry from the mountain side and the crag those myriad buildings, palaces, temples, cities, roads, canals, etc., which are the boast of civilization; that we have discovered in compressed steam one of our most powerful natural helpers; that we have made of the seas and winds one of the great means of communication between the peoples distributed over the earth; that we have found in magnetism the guide to show us the way across the vast expanse of the ocean; and lastly, that we have made of that other mysterious force which we name electricity, the marvelous messenger which instantaneously transmits our thoughts to distances of thousands of miles. The faculty which has already been successful in obtaining such admirable results from the wonderful world which it has to explore, and which is possibly destined to obtain others still more astonishing, is that known to political economy as industry. We must then admit as industrial progress everything which tends to increase the power and productiveness of this faculty, all that contributes to swell the mass or the importance of the utilities of every sort which are the ultimate end of its action, the satisfaction of our wants and the necessary basis of the amelioration and diffusion of human life. Hence it follows that industrial progress can be shown in all useful works, without exception; in those of the savant, the statesman, the magistrate, the clergyman, the artist or the author, as well as in those of the agriculturist, the manufacturer or the merchant. The first named labor, or at least may labor, to develop and improve our intellectual and moral faculties, which are so closely bound up with our industrial faculties that the latter are necessarily elevated or debased with the former. Thus the labors of the savant, by extending our acquaintance with nature and with the properties of the objects submitted to our action, manifestly increase the real power of industry, and it is commonly labor of this sort which paves the way to the greatest industrial advances; the labor of the statesman or the magistrate has as its legitimate object to fit us for social life, to protect our life, liberty and property against violence or any attack that might be made on them, thus giving to all the security, lacking which, industry would soon cease to be productive; the labor of the clergyman or the moralist may, if it be well directed, tend to the same result by adding to the force of authority used by the legislator or the magistrate, the force of persuasion; they may, in addition, impart to life consolation and hope, which are utilities of no mean order, and they may also influence our passions and our habits by enlightening us as to their consequences in the manner most favorable to the productive power of our industrial faculties; finally, the labor of the artist and the author may also tend to the same result by cultivating and purifying our imaginations, our affectional faculties, by inspiring us with a taste for the beautiful and the good. True it is that the different kinds of labor have not always the tendency we have just attributed to them, and that instead of contributing to the amelioration of our intellectual and moral faculties they have often for effect, if it be not their aim, to deteriorate and degrade them; but if such be the case they are no longer useful works, and, far from assisting industrial advance, they are powerful obstacles to it. —The first want of all animate beings is food. As long as men look to hunting, fishing, or the few vegetable foods which the earth produces spontaneously, for their livelihood, their existence is a wretched one and little above that of the beasts; their wants, like their industries, are limited, and yet to live thus even in the sorriest way each individual must occupy a square league or more of fruitful soil. The first step in advance is taken when, abandoning the pursuit of their prey in the forest or the waters, men learn to assure themselves of their daily food by capturing the creatures most easily tamed and forming them into flocks which they feed, wandering with them from pasturage to pasturage which the untilled soil affords. But this means of providing food demands also the occupation of immense tracts of country by a small population, and in that case wants and industry continue extremely limited. The most important step in industrial progress is taken when populations, recognizing that they can by cultivation substitute alimentary vegetation for that which has not that quality, determine to exchange a savage or a pastoral existence for an agricultural one. —When it reaches this last degree of development, industry is in possession of the most powerful means which have been given it for the improvement and spread of human life; agriculture soon succeeds in producing a quantity of substances far in excess of that needed for the sustenance of the cultivators of the soil, population increases, and some are able to turn their attention to other labor; henceforward wants increase progressively, and food, shelter, furniture, clothing, fuel, the want of utensils and machines of all sorts, of communication, of transport, etc., put to work whole masses of laborers, divided into series corresponding to each particular class of wants, then subdivided into a multitude of different professions, which form the special occupation of those who practice them. Since this specialization of labor rapidly increases the force of industry, wealth accumulates, and as its sum increases, populations find it easier to create new wealth; it is then that numerous classes can be exempted from material labor and may apply their energies to the cultivation and perfecting of human faculties. This last named variety of labor is no less necessary than any of the others to the continuation of industrial progress, for the obstacles to this progress appear as much in the imperfection of our moral faculties, in the evil bent of our passions, in the wrongs we are too prone to do each other, as in the things on which we act. —In the present state of civilized communities the main conditions most necessary or most favorable to industrial progress seem to consist: 1st, In security, which includes the maintenance of peace and the guarantee, as complete as possible, of property; 2d, In specialization of employments; 3d, In abundance of capital; and 4th, In freedom of labor and contract. —It will be needless to dwell at length on the intimate relations between industrial progress and security. In times of agitation, of trouble or of war, multitudes of men who might contribute to this progress, are occupied, on the contrary, only with what injures and arrests it, and those who are not directly engaged in hurtful acts, weakened in general by anxiety and by the uncertainty of the future, lose much of their energy. The experience of all ages proves that the most fruitful periods in industrial progress have always been those in which security and peace seemed best assured. It has only been through chance or by the efforts of men of genius that important discoveries destined to increase greatly the power of industry, have been made in a time of violence or disorder, but it is evident that it was not this condition of affairs which gave birth to them, and it was only after the restoration of peace and security that all the benefits derivable from them were obtained. —The security of property is the indispensable condition of industrial progress; for this progress is generally the result of a succession of efforts which no one would make unless certain of reaping the fruit of them. Without this guarantee, industry, far from making progress, would rapidly slip back to its original starting point. Where property is not secure, men must necessarily look upon one another as enemies rather than as friends. The idle and improvident constantly seek to take possession of what has been earned by steady and industrious men; and if the strong arm of the law did not hinder their aggressions they would become, by destroying all security, an obstacle to industry and to all idea of accumulation, and would thus drag down all classes of society to the level of hopeless destitution to which they have themselves fallen. (See M'Culloch's "Principles.") It is certain then that, all else being equal, industrial progress will be most rapid and most extensive where property is best guaranteed, not only against illegal attacks, but against those made on it in the name of the law itself or of public authority. —Adam Smith, in his endeavor to determine how it is that division or rather specialization of labor develops greatly the power of industry, assigns three principal reasons as its cause. The first, is the increase in aptness and dexterity which workmen gain by the constant repetition of one operation; the second, is the saving of the time which is unavoidably lost, in labor not sufficiently specialized, by passing from one operation to another; the third, is the facility given by specialization of labor, to the discovery of machines or of natural motors which may save human labor. It is especially by the last named of the three causes that division of labor contributes powerfully to industrial progress; by concentrating the attention of each worker on operations reduced to their simplest elements, it has paved the way for a multitude of inventions and discoveries. It would be an error to suppose, as has often been done, that division of labor does not sharpen and improve the inventive faculties, among workmen and artisans. As society advances, the study of the different branches of science and of philosophy becomes the principal or the exclusive occupation of the most intelligent men, and each of them, by concentrating his research and his thought on one special branch of knowledge, arrives at a degree of perfection or experience never, or at most very rarely, attained by those who busy themselves with all the sciences. (M'Culloch's "Principles.") —The possibility of specializing labor depends evidently on the power of exchange; without this power each one of us would be obliged to produce by himself all the objects of his different wants; it may therefore be affirmed that all which serves to extend the power of exchange, permits the increased specialization of labor, and in consequence contributes to the industrial progress which depends on that specialization. —It is easy to understand how this progress is furthered by abundance of capital; without tools or machines, without materials, without supplies resulting from previous labor, the most highly perfected industry could effect but little; it was only by the continued accumulation of capital that industry became powerful; and its power necessarily increases as capital increases. Suppose, for example, that it be desired to bring under cultivation a distant and uninhabited land; if those who undertook such a scheme began it with their hands only to help them, it would not be long before they would perish of want, however industrious they might be; but if they arrived at the place well supplied with all the implements needed for cultivation, for clearing land and for transport; with provisions, cattle, seeds, etc., their enterprise might succeed, and their success would be the more assured the greater the capital they could devote to it, the better they were in a position to renew at need their supplies, until the newly broken land could furnish them itself. That a people may establish canals, railways, steam engines, electric telegraphs, etc., they must previously possess a multitude of workshops and of instruments necessary to the preparation of all the materials used in producing these things, unless they receive them ready made from some other people, in which case they must give in exchange other capital of the same value; they must also be provided with provisions of every description in sufficient quantity to support the workmen, while they are being established. Without those conditions, and as long as they can not fulfill them, they must resign themselves to remain deprived of these powerful means of progress and civilization. —We have enumerated, among the main conditions needful in industrial progress, freedom of labor and of contract. By this freedom all men are occupied with the career in which it is likely that they will contribute most to the production of wealth, because each man has been able to choose for himself the career which seemed to him best suited to his position and to his peculiar talents; on the other hand, each is urged by all the force of personal interest to multiply and improve the services which he can render others in the career which he has chosen, for with entire freedom in transactions, the rewards which he can obtain will necessarily be proportioned to the quantity or the value of his services, a value determined by the free judgment of the interested parties. Hence, it follows that the more extensive this liberty of the individual is, the more universal, persevering and fruitful will be the efforts which urge men to industrial progress. Experience also amply bears this out, for the history of industrial development shows that it is more powerful in proportion as each person is free to choose his own profession, to practice it as he understands it, (under the sole condition of respecting the liberty and property of others), and to dispose at will of the products he obtains. In our times the industrial power of any nation may be judged of by the extent of the liberty assured to its labor. The most progressive are those which have best known how to guarantee to every man the free disposition of his useful faculties and of what they produce; the least so, those where that freedom is most restricted, where work and commerce are most subject to regulation by the state. —We have already alluded to the fact that the division of labor is closely allied to the exchange of wealth, and that in restricting the latter, obstacles are thrown in the way of the industrial progress depending on the former. We may here remark, that on the day industrial populations shall have done away with or greatly diminished the legislative obstacles in the way of international trade, they will have opened the way to immense industrial progress; for these obstacles oblige each nation to devote part of its energy to those kinds of labor which with it are less favored by natural circumstances than they are elsewhere, and oblige it to restrain within the limit of what it can consume the exploitation of the special advantages of the country it occupies, which is simply squandering the gifts of Providence. —Industrial progress is rarely made without entailing some partial suffering, for it almost always consists in a new and more perfect mode of satisfying certain classes of wants which were formerly met by other means. The industrial faculties engaged in the abandoned processes can not always be turned immediately to other occupations; there is, therefore, more or less intense and more or less extended suffering undergone by all those whose special industry is thus rendered, at least temporarily, useless, and who are consequently obliged to change their calling. This is unfortunately an inevitable in convenience connected with the gradual progress of industry. A. CLÉMENT. INGERSOLLINGERSOLL, Jared, was born in Connecticut, June 14, 1749, and died in Philadelphia, Oct. 21, 1822. He was graduated at Yale in 1766, was a delegate to the continental congress from Pennsylvania, 1780-81, and to the convention of 1787 (see CONSTITUTION), took the federalist side in politics, and was supported by the federal party for the vice-presidency in 1812. (See FEDERAL PARTY, II.) A. J. INHERITANCE.INHERITANCE. The right of inheritance is the right by virtue of which goods of every kind are transmitted, after the death of those who possessed them, to their heirs or descendants. The person who succeeds to another's goods is called his heir; heritage is either the fact of transmission, or the thing transmitted, the right of inheritance is the principle by virtue of which the transmission is made. We shall here treat only of the right of inheritance. —The right of inheritance flows naturally from the right of property itself. "The right to dispose of what one owns," Charles Comte justly remarks, "is one of the essential elements of property." In fact, the owner's right over what he possesses is absolute, so that no one else can have any pretension thereto, either in the present or in the future, so long as he has not transferred it by his own act. This is a consequence of the very nature of property, and of the original causes of the institution of property. Hence the owner has the right to dispose of his goods in favor of whomsoever he pleases in the present, and, for the same reason, to dispose of them also after his death. This is a natural and simple conclusion, so simple and so natural that it has been sanctioned by the unanimous consent of all nations. —Nevertheless this conclusion has been contested at different times by certain adventurous and frivolous spirits, who have pretended to oppose the rights of nature, such as they understood them, to what they have been pleased to style a mere social convention. "Can a man who is dead," asks Raynal, "have any rights? By ceasing to exist has he not lost all his powers? Did not the great Being, in depriving him of life, deprive him also of everything that was dependent on his last wishes? Can these wishes have any influence over succeeding generations? They can not. As long as he lived, he enjoyed, and rightly, the land he cultivated. Upon his death it belongs to the first person who takes possession of it and chooses to cultivate it. Such is nature." —It will be noticed, and is evident from the words which we have underscored, that Raynal here refers only to landed property, apparently not suspecting that there is any other kind of property. It is scarcely necessary to say that we give to the word property a much larger scope, applying it to goods of any kind that men can possess. If Raynal had taken it in this sense, which is the only one in which it should be taken, he would perhaps have realized, from the first, the injustice of his proposition. But what must we think of the singular plan which this writer proposes, even considering it from his own standpoint? After the death of a landowner, the first comer takes up his land, and cultivates it in his place; but he probably would not do this, without taking at the same time his plow, his oxen, his barn, his farm house, the unharvested crops, and those already gathered; for men do not labor with their hands alone, nor do they sow without seed, nor live upon air from seed-time to harvest. It is plain from the inconsistency and frivolousness of his proposition that Raynal did not even ask himself, if a landowner or farmer would take much pains to gather together all these things upon his place, when he knew that they would become, after his death, the booty of the first comer. Would he not, in this case, rather consume in his lifetime all he possessed, and leave after him but the bare land? Our author did not stop to inquire whether there would not always be, on his hypothesis, a number of new comers every ready to quarrel over the dead man's spoils; he did not think of informing us how their rival pretensions could be reconciled. It is truly astonishing to find so much inconsistency in a man who, in the last century enjoyed considerable reputation as a philosopher and writer. —The plan which he afterward proposed seems not quite so thoughtless. He says: "Among the different possible methods of inheritance to citizens after their death, there is one which might perhaps find some supporters: it is that the possessions of the dead man should form part of the mass of public goods, to be employed first in relieving the indigent; next in continually restoring an approximate equality in private fortunes; and, these two important points accomplished, in rewarding virtue and encouraging talent." —This plan, which is not quite so absurd as the former one, has found supporters. It has been adopted, with some modifications, by a certain number of modern sectarians, who believed they were making a discovery in bringing it to light, and were astonished at the fertility of their own brains. Although it has become utterly impossible of application to landed property in modern society in its present state of civilization, this was not always the case, nor is it equally the case in all nations even at the present day. In fact, we find an institution somewhat similar to this in many barbarous nations, among whom the possession of the land is only for life, and this land, after the death of the titular owner, reverts to the public domain. This was the case in France, at least for certain landed estates, under the first French dynasty; and it is the case to-day in some very remote countries of the east. Applied to landed property, therefore, this system is not impossible of realization. The only strange feature about it is, that any one should dare to propose to us as progress, this practice, borrowed from barbarous countries and times, beyond which we have, most happily, so far advanced. As to personal property, which is by far the most important in our times, this system has been found impracticable in all countries and at all times. It would be, in the first place, a revolting injustice. Personal property, which constitutes what is called capital in political economy, is essentially the fruit of the possessors' labor. It has in some sort been created by them. By what right, therefore, can it be disposed of, even after their death, without their approval? To whom would the right of thus disposing of it belong? Do not our natural feelings tell us that property of this kind can legitimately go only to the natural heirs of those who produced it, or to those whom they themselves designated? Besides, even if we should refuse to recognize the force of these considerations, the system must inevitably fail, through the obstinate resistance of those interested, who would easily find means of saving their personal property from the hands of the usurpers. We may remark, moreover, that the most violent enemies of the right of inheritance have been themselves so strongly impressed by the evidence of this right, when considering the question, that they have rarely attacked the right of inheritance to personal property. They almost always limit the application of their system to landed property. —But within these limits, it is evident that the system is applicable only as long as the land remains unimproved, that is to say, as long as the owner has not collected and placed there the capital necessary to improve it: barns, stables, cattle, farming implements, etc., not to speak of the innumerable works of improvement which all lands require. This capital once collected and these improvements made, as both are almost always inseparably connected with the land itself, the same difficulties of fact and right arise as in the case of capital. The truth is, therefore, that this system is applicable only in the infancy of nations, when men content themselves with performing on their land the transitory work of to-day, without establishing anything permanent thereon. The country which would undertake to perpetuate such a system would remain forever in that infant state in which alone it is possible.—"If I wished," says Charles Comte, "to refute the errors, borrowed from the Abbé Raynal, concerning the right of children to enjoy the goods left by their parents when dying, I could not help calling attention to the fact that the family spirit is one of the principal causes of the production and preservation of wealth; that a man, to insure his children a living, performs labor and undergoes privations, to which no other consideration would induce him to submit. I would point out to my readers that families conform their manner of living to their means, while, if the wealth of a man were not to pass to his descendants, he should accustom his children to the severest privations, and himself set them the example; that, consequently, he could derive scarcely any real advantage from his property, even during his lifetime. I would show to them, finally, that a nation in which children were excluded from succeeding to their parents, would, in a very few years, fall a great deal lower than the inhabitants of Egypt under the domination of the mamelukes, or the Greeks under the domination of the Turks." —We will not here insist too strongly upon these considerations, which will naturally recur under the word PROPERTY, where they more properly belong. But we must add a few words upon another phase of the question. —Although the right of inheritance, like the right of property itself, is absolute, it can and ought to be equally regulated by law. The provisions of the law are not, however, more arbitrary in this matter than they are on many other points. Their general object should be, in the first place, in some sort to force the dying man to fulfill the formal or moral obligations contracted in his lifetime; next, to avoid possible embarrassments and litigation. —Since every man can dispose of his own goods, it is an undoubted principle that a dying man has the power to determine by will what division he will make of the fortune which he leaves after him. But if this man leaves children, shall he have the right to dispose of this fortune to the exclusion of his children? This does not appear to us as a logical consequence of the right which he enjoys. By bringing into the world beings who depend upon him, he has contracted toward these beings and toward society itself, the obligation to support them, to educate them, and to leave them, after his death, as far as his means will allow, in a position corresponding to that which he assured them in his lifetime. His right, therefore, here finds a natural limit in the obligations which he may have contracted. There are others of a different nature, equally deserving of notice, but which we shall not enumerate here, because it is the principle alone that we have here undertaken to lay down. CH. COQUELIN. INSTRUCTIONSINSTRUCTIONS. This word, in politics, refers to the right in a government or in any portion of the people to direct or control the conduct of its or their agents, delegates or representatives. The existence of the right is determined by the nature of the agency or trust, and no more general rule can be laid down than this, that in all cases where the relations between the parties are essentially those of principal and agent a right to prescribe what the agent may or may not do is unquestioned, and that in the case of other relations, such as those arising from a trust, the right is uncertain. A distinction may be made between cases in which instructions are given to a person who is merely delegated to express in any assembly, such as a nominating convention, the predetermined wishes of his principals, in which case the instructions when given by the actual principals are properly controlling, and other cases in which the right of instruction is asserted over persons sent to a deliberative body, as a legislature, in which case they are not, since a legislator is not an agent, but a representative. But no invariable rule can be laid down in any case. In the diplomatic service instructions are specific and obligatory, but our diplomatic officers are strictly agents. The United States has never sent out a diplomatic officer with the representative character of an ambassador; our highest officers have been envoys, with full power for particular purposes, and their instructions have become more specific as the means of communication between states have been facilitated, and as the necessity of depending upon their discretion has thereby been lessened. In the last century a much wider latitude was allowed to all diplomatic officers than now, and their instructions were then more general, although defining their limits and manner of negotiations. The first of our own diplomatic officers, Commissioners Adams, Jay, Laurens and Franklin, accompanied the preliminary articles of peace transmitted to congress in 1783, some of which they had signed, without, as they had been directed to do, communicating them to the French government through Count Vergennes, with excuses for having "so far deviated from the spirit of our instructions"; and their disobedience seems to have been very kindly acquiesced in. At a much later day, however, the deviation from instructions was the reason alleged by the administration at Washington for the recall of Mr. Motley from his post as minister to England, although so far as can be ascertained from the publications relating to this particular case, Mr. Motley's deviations from the instructions of the state department were scarcely perceptible. —The instruction of members of constitutional conventions has been claimed as a right, but principally through the limitations of the powers of the convention by the legislature which called the convention. Thus, it seems to be decided that a legislature may call a convention to amend certain articles of the constitution, and the convention so called can not propose amendments to other parts of the constitution not specified. (Mass. Sup Ct., 6 Cushing. 573; N. C. Convention, 1835.) In the Ohio constitutional convention of 1850 there was also some attempt to instruct delegates by the constituencies, and one delegate, who had been called upon to adhere to the instructions given him "strictly, or to resign," chose the latter course, without, however, expressly admitting the validity of such instructions. A conspicuous instance of the disobedience of all such instructions is afforded by the federal convention of 1787. All of the delegates to that convention, excepting those from New Jersey, were by their credentials restricted to the task of revising and amending the articles of confederation, and all of them disregarded that limitation on the plea of necessity. —The right to give instructions is of importance in connection with legislative bodies, and with nominating conventions. Blackstone says, that in the British parliament "every member, though chosen by one particular district, when elected and returned, serves for the whole realm, for the end of his coming thither is not particular, but general, * * and therefore he is not bound, like a deputy in the United Provinces, to consult with or take the advice of his constituents upon any particular point, unless he himself thinks it proper or prudent to do so." This principle was first asserted in parliament as early as 1571. It is admirably emphasized by Burke in defining the true relations of a legislator to his constituents, in the speech made by him to the Bristol electors after he had voted to extend the privileges of the Irish trade in opposition to their express instructions. In the United States the same theory of the general character of the duties of the members in both the upper and the lower chambers of a legislature has finally prevailed, although the history of the subject shows some wavering and a distinct tendency in one party toward the narrower view. During the debate on the first proposed amendment to the constitution in the house of representatives, in August, 1879, it was moved by Mr. Tucker, of South Carolina, to add to the clause which prohibits congress from making laws abridging various specified rights, these words, "to instruct their representatives." The proposition was vigorously supported by Elbridge Gerry, who said: "I presume that the gentlemen of this house do not mean to arrogate to themselves more perfection than human nature has as yet been found capable of; if they do not, they will admit an additional check against abuses, which this, like every other government, is subject to. Instruction from the people will furnish this in a considerable degree. * * * Now although I do not believe the amendment would bind the representatives to obey the instructions, yet I think the people have a right both to instruct and bind them." The motion was opposed by Madison, Fisher Ames and Roger Sherman, the latter saying: "It appears to me that the words are calculated to mislead the people by conveying an idea that they have a right to control the debates of the legislature. This can not be admitted to be just, because it would destroy the object of their meeting. I think when the people have chosen a representative it is his duty to meet others from different parts of the Union, and consult and agree with them to such acts as are for the general benefit of the whole community. If they are to be guided by instructions there would be no use in deliberation; all that a man would have to do would be to produce his instructions and lay them on the table and let them speak for him." The amendment was lost by a vote of 10 to 41. The feeling, however, was still very general that the people had some power of instructing their representatives, and of course that disobedience to such instructions entailed some penalty, though no attempt was ever made to specify what it was, John Adams, for instance, says ("Works," vol. x., p. 605), "The right of the people to instruct their representatives is very dear to them and will never be disputed by me." Judge Tucker, speaking of the embodiment of a constituency in its representative, and its consequent right to instruct him, says (1 Black, 193 n), "However inadmissible this doctrine may be in Great Britain, it seems perfectly adapted to the principle of our government." This feeling found expression in the constitutions of several of the states, in provisions that the people have the right to petition, etc., and "to instruct their representatives." This is found in the constitutions of the following states: Arkansas, 1868 Art. I., Sec. 4; California, Art. I.; Florida, Art. I., Sec. 2; Indiana, Art. I., Sec. 31; Kansas Bill of Rights, Sec. 3; Maine, Art. I., Sec. 15; Massachusetts, Art. XIX.; Michigan, Art. XVIII., Sec. 10; Nevada, Art. I., Sec. 10; New Hampshire, Part I-XXXII.; North Carolina Dec., Art. I., Sec. 25; Ohio, Art. I., Sec. 3; Oregon, Art. I., Sec. 27; Pennsylvania Dec. Rights. Tennessee, Art. I., Sec. 23; Vermont, Chap I.-XX.; West Virginia, Art. III., Sec. 16. The words are substantially the same in the constitutions of each of these states, but they have been omitted in the latest constitutions of Arkansas and of Pennsylvania, and the clause was altered in the last constitution of Illinois so as to read that the people shall be secure in their right to "make known their opinions to their representatives." The same phraseology is also used in the constitution of Iowa, Art. I., Sec. 20, and in that of New Jersey, Art. I., Sec. 19. It is difficult to discover the object of such provisions. The latter is obviously absurd, and if the language used in the greater number of the constitutions is to be construed as protecting the right of the people to give their representatives advice or information, it seems useless and equally absurd. If it is to be construed as meaning anything more than that, it not only does violence to the true and established conception of the function of representatives, that they are to deliberate and to legislate for the general good, but it is also futile. No such provisions could give the instructions any coercive effect unless some penalty was attached to the disobedience of them, and no penalty in such cases has ever been imposed or suggested. —These provisions can be considered only as an expression of a feeling prevalent at the time of their adoption, of a vague distrust of any central government, and of the necessity for the fullest protection of individuals against it. Such provisions have, however, in conjunction with the earlier democratic theory of the sovereignty of the states, served to give color of authority to the frequent assertion of the right of a state legislature to instruct its senators in congress. Upon this topic Rawle says: "Some of the state legislatures appear to have viewed the relative duties of the senators whom they have appointed in a more restricted light than it is apprehended the constitution implies. It seems to have been supposed that the senators were bound to obey the directions of the state legislatures, and the language of some resolutions has been, that the senators be 'instructed' and the members of the house of representatives from the particular states 'requested' to make and support certain resolutions. But surely the opinion is erroneous; a senator is no more bound to obey the instructions of the state legislatures in opposition to his own judgment than a representative of the people in the other house is bound by the occasional instructions of his constituents. They are both elected for the purpose of freely and honestly exercising their own judgment according to the best of their capacities." (Rawle on the Constitution, p. 38.) The history of many states furnishes instances of the assertion of the right. John Adams bewailed it in Massachusetts in 1820, and in the same year the New York legislature passed a resolution "instructing the senators and requesting the representatives" from New York to vote against the admission of a slave state to the Union. The legislature of the same state also instructed its senators to vote for the tariff of 1828, and Van Buren, then a senator, obeyed these instructions in opposition to his personal wishes, although Webster insinuates that he procured them to be passed in order that he might, on the ground of a state's right to instruct its senators, excuse his tariff vote to the state's-rights and free-trade wing of his party in the southern states—It would be difficult and unremunerative to ascertain how often this right to instruct senators has been asserted. Benton, speaking of the resignation of senator Hugh L. White of Tennessee, says that it took place "under circumstances not frequent, but sometimes occurring in the senate—that of receiving instructions from the general assembly of his state, which either operate as a censure upon a senator or which require him to do something which either his conscience or his honor forbids." While in the case of such instructions there has never been any attempt to provide means for enforcing them, the acquiescence of senators in the view that states had the right so to instruct, has sometimes given them a binding force. Thus in the case of Mr. White, who had been instructed to reverse his course of voting on certain measures and to support Mr. Van Buren's administration, Benton continues: "He consulted his self-respect, as well as obeyed a democratic principle, and sent in his resignation." A more conspicuous instance occurred in 1840. Messrs. Brown and Strange, both democrats, were at that time senators from North Carolina, and the whigs controlled the state legislature. The whig party had disavowed the doctrine of state instruction, but nevertheless in 1838 this particular whig legislature passed a set of resolutions denouncing the passage of the expunging resolutions by the senate, and also the course of the administration generally, and further resolved "that our senators in congress will represent the wishes of a majority of the people of the state by voting to carry out the foregoing resolutions." To this the two senators responded in a letter, dated Dec. 31, 1838, as follows: "The resolutions do not expressly instruct us to carry into effect the opinions expressed therein, nor are we able to perceive in them impliedly any authoritative command, such as instructions convey. We are therefore left to infer that it was the intention of the general assembly not to assert or to exercise the right of instruction. We have therefore publicly declared that whenever instructions are given us by the legislature we will either obey them or resign. We therefore respectfully ask your honorable bodies if we err in our construction of the resolutions, that we may be set right." The legislature, in reply, resolved that "the resolutions are sufficiently plain and intelligible to be comprehended by any one desirous of understanding them;" and it was insisted by Mr. Clay in the senate, and by whig newspapers, that the resolutions in question were really instructions, and that Messrs. Brown and Strange were, therefore, on their own theory, bound to resign. They presented the resolutions to the senate, but did not at once resign, presumably because that course would have destroyed the democratic majority in the senate. But their failure so to do subjected them to so much criticism at home that, in 1840, they tendered their resignations in such manner as to make the propriety of their course an issue at the ensuing state election, in which, as it resulted, the whigs won a decided victory. The case of the censure of Charles Sumner by the Massachusetts legislature, in 1872, may be referred to in this connection as an illustration of an entirely different and more modern view of a senator's duty under such circumstances. —The passage of resolutions in state legislatures requesting the representatives and senators from each state to pursue a particular course in congress, is still not infrequent, as, for instance, the resolutions passed by the New York legislature in 1881, urging the confirmation of President Garfield's nominee for collector of the port of New York, which had been vehemently opposed by the New York senators, and the free-trade resolutions passed by the Iowa legislature in 1882. —The doctrine of instructions has been applied more frequently and more variously to delegates to nominating conventions than to members of legislatures, and perhaps properly, on the theory of the mere agency of such delegates. Without reference to local conventions it will be sufficient to trace the usage in this regard in the national conventions. From that usage it appears that the doctrine of instructions has been applied, first, to the instruction of district delegates by their actual constituents, through the caucus or convention selecting them; second, to the instructions by a state convention of all the delegates from that state, however chosen—but in such cases the instructions have in later years rarely extended to a direction to vote for a particular person, and have not gone further than to instruct the delegation to vote as a unit in accordance with the decision of the majority, thus constituting the well-known "unit rule"; third, the adoption of the unit rule by the delegation itself, and its own instruction to its chairman to cast all the votes of the delegation in one way or for one person. The democratic party has leaned toward the validity of the instructions in each of these cases, while the whig and republican parties have favored the opposite view, and it seems to be now settled in the latter party that delegates are not in any sense agents and bound by their instructions, but that each may vote his own sentiments. The principal instances in which the right of instruction has been asserted in national conventions are as follows: In the democratic convention of 1840 the delegates from most of the states were instructed to vote for Van Buren. In the democratic convention of 1844 the delegates from Massachusetts, Pennsylvania, Ohio, Michigan, Maine, New Hampshire, Vermont, Connecticut, Rhode Island, Louisiana, Alabama, Mississippi, Arkansas, Illinois and New York, were instructed to vote for Van Buren by the conventions which selected them, or else Van Buren had been actually nominated by those conventions. In this convention of 1844, also, the unit rule seems to have been asserted for the first time by Virginia. The delegates from that state were appointed en masse, and it was resolved that the votes of her delegates should be settled by the majority and counted per capita. In reference to this, Mr. Calhoun, in an address to his political friends and supporters, dated February, 1844, after animadverting severely upon the manner in which the convention was being packed, and refusing to allow his name to go before it, says: "I object not less strongly to the mode in which Virginia has resolved her delegates shall vote. With all due respect I must say I can imagine nothing more directly in conflict with the principle of our federal system of government, or, to use a broader expression, the principles upon which all confederate communities have ever been united. I hazard nothing in saying that there is not an instance in our political history, from the meeting of the first revolutionary congress to the present day, of the delegates of any state voting by majority and counting per capita." (Calhoun, "Works." vol. vi.) —In the democratic convention of 1848 delegates from North and South Carolina stated that they voted in accordance with their instructions. In 1852 the democratic convention resolved that each state should be entitled to the same number of votes to which it would be entitled in the next electoral college, without reference to the number of delegates in attendance, and "that the manner in which the said vote is to be cast shall be decided by the delegation of each state itself." The whig convention of this year adopted the same resolution excepting the last clause, and the whole of the resolution was readopted by the democratic convention of 1856. In 1860, at the Charleston democratic convention, the Georgia delegation was "requested" to vote as a unit, and Mr. Caleb Cushing, the chairman, decided that this amounted to an instruction which must be obeyed. The New Jersey delegates were "recommended" to vote as a unit, and this Mr. Cushing decided was likewise a binding instruction; but on this point his decision was reversed by the convention, which also decided that in the absence of instructions to a delegation to vote as a unit its members might cast individual votes. There was in this convention much intelligent discussion by the chair and others, of the whole subject upon instruction, and while the right to instruct seemed to be unquestioned, it was not clear what amounted to an instruction. —In 1860, also, the republican convention granted the right to two delegates from Maryland, after the vote of that state had been cast as a unit, to vote as individuals, and at this convention the unit rule was imposed upon the New York delegation by a vote of the delegates in caucus, under circumstances which are worthy of mention. It was feared that the delegation, which had been expected to vote unanimously for Mr. Seward, might break, and to avoid that contingency a caucus was called, from which all persons not delegates excepting Mr. Thurlow Weed were excluded, and through his instrumentality a resolution was adopted by a large majority instructing Mr. Evarts, the chairman of the delegation, to cast the solid vote of New York for Gov. Seward, and although this resolution was bitterly opposed as a gag law by several delegates, it was acquiesced in by all, and the vote of New York was cast as directed. —In 1868, in the republican convention, the Pennsylvania delegation presented a candidate for the vice-presidency under instructions, but when one member of that delegation refused to be bound by those instructions, and pleaded "the great principle of individual right to be represented in that convention," he was overwhelmingly sustained by the convention. —In 1876 a caucus of the New York delegation to the republican convention attempted to instruct its chairman to cast the solid vote of the state for Mr. Conkling, as had been done in 1860 for Mr. Seward; one delegate, however, Mr. George William Curtis, asserted the right of every delegate "to vote his own sentiments," and declined to be bound either by the unit rule or the instructions of his colleagues; and the convention, by a vote of 395 to 353, sustained his position. In the same convention the Pennsylvania delegation was stated to have been instructed by the state convention to vote for Gov. Hartranft, and to vote as a unit under the direction of the majority. Four members of the delegation declined to obey these instructions, on the ground that they held credentials from their own districts and owed no allegiance to the state convention, and after debate they were allowed, by a vote of 395 to 354, to vote as individuals for Mr. Blaine. —The occurrences in the republican convention of 1880 are too recent to need more than a bare reference. The delegations from New York, Pennsylvania and Illinois were "instructed," and the convention, by a decisive vote, refused to consider them bound by their instructions. —In democratic conventions the validity of instructions and even their necessity is still recognized. The convention of 1876, for example, resolved "that the states be requested to instruct their delegates to the democratic national convention which is to be held in 1880, whether it is desirable to continue the two-thirds rule longer in conventions," and in democratic conventions the unit rule based on instructions is still in vogue, but it is to be presumed, only because of the lack of desire on the part of the delegates to break or violate it. Considered altogether, instructions for legislators or delegates appear, therefore, to be passing away with the ultra-democratic theory of the rights of states and of constituencies upon which they were founded; and happily, for the doctrine of instructions seems inconsistent with the theory of an intelligent and free representative system, and in practice it had become a mere instrument in the hands of machine politicians for the accomplishment of selfish ends and the perversion or the defeat of the wishes of the actual constituents. FREDERICK W. WHITRIDGE. INSURANCEINSURANCE is a contract by which one party undertakes to protect the other, to a greater or less extent, against the pecuniary consequences of certain accidents to which men are liable, such as the loss of property by fire or shipwreck, or the loss of future earnings by sickness or death. I. The Need and Basis of Insurance. The material possessions which constitute the property of man are, aside from the destruction of value which occurs in consequence of their use, constantly exposed to all kinds of injuries and losses, which are occasioned partly by human actions and partly by the hostile forces of nature. Even human labor is not exempt from this destiny, and, as it creates property, its temporary or permanent loss is connected with loss of property, not only to the laborer himself, but also to those dependent upon him. Of course many of these dangers can be warded off by the owner himself. His power to do so increases with increasing education, which teaches him caution, makes him acquainted with the causes of the dangers, and enables him to protect himself against the inimical forces of nature. Education has, of course, the same effect upon the diminution of those willful and careless actions by which the rights of others are invaded. Against other dangers of the same sort, whose removal exceeds the strength of the individual, the state protects by its courts and police. But it is impossible for the individual or the state to protect against all dangers to property, even with the best intentions. In spite of education, in spite of the best ruled state, serious accidents will happen, such as sickness, which disturbs or ends human labor; premature death of fathers, which exposes the widows and orphans to want; conflagrations, hail storms, floods, earthquakes, bad harvests, cattle plagues, shipwrecks, accidents in travel, bankruptcies, panics, crises, etc., etc. Losses of property by such occurrences are unavoidable. It goes without the saying that such losses may easily become ruinous to those upon whom they fall, and may prevent them from again taking up any remunerative employment. Since the loss is unavoidable, there is only one course to meet it—restitution. But who shall make this? In the case of malicious or careless actions of others, there is a legal claim to damage from that person. But what if the offender is unable to meet the obligation, or can not be ascertained? What of those losses caused by natural forces or by accident? The loser must bear all the loss himself in such cases unless he is assisted by charity. But it will not do to rely upon this source, since, as it is purely voluntary, no claim can be made to it, either upon the state or the individual. Nor would it be desirable to do so, since individual independence would thus be impaired. Fortunately there is another way to replace these losses. Human society suggests it by affording a kind of help which is perfectly consistent with the self-respect of the receiver, viz., self-help. A loss which is distributed among many is scarcely felt by the individual. When, therefore, a large number of persons who are threatened by the same danger unite and declare the loss which may happen to any individual in the union from this danger to be a common one, i.e., to be a burden resting equally on all, a means of securing full restitution has been found. This will be made up by the shares of all members in the loss which by the terms of the society is to be a common one. By accepting the share which falls to him, every member secures the right of claiming full restitution in case a similar loss should occur to him. This is generally a small sacrifice in comparison with the advantage secured by it, which often consists in the averting of complete ruin. The injured party owes his security against loss, therefore, not to any act of another's liberality, but to his own resources realized by union with others. The help afforded has the nature of an economical undertaking, and rests, therefore, on reciprocity of service. The individual member helps the others make restitution and receives in return restitution from them. This reciprocal aid is afforded by the contrivance of insurance, which has acquired in modern times such great importance and extension. The matter is so simple and the principle underlying it so plain that it is astonishing that such an institution did not exist in ancient times, that it was not born until the middle ages and did not acquire a really great importance until within a comparatively recent period. —II. Object of Insurance. We have described this in general already, but it needs a more careful definition. Not every direct or indirect loss is adapted for insurance. A loss intentionally inflicted by a person on himself can not be an object of insurance: the loss must be more or less accidental. It is not necessary, however, that the injury done shall be absolutely accidental. It is enough that it be accidental so far as the injured party is concerned, i.e., not intended by him but caused by the actions of other parties which he could not hinder. It makes no difference whether the action of others which caused the injury was done on purpose, or carelessly or in ignorance of the consequences. Even loss which occurs through one's own negligence, if it is not too gross, does not exclude from insurance. However, in the present stage of the development of insurance, accident plays the principal part, and, in insuring, regard is had first and chiefly to it. But the object of insurance is still more limited. The injury must not be of such a kind that it can happen at the same time to a very large number of the owners of those objects threatened by it, or that it threatens a small class of persons very often and most others very seldom or not at all. If the first were the case, the amounts devolving upon the individuals to pay in order to indemnify the rest would reach such a height that it would be better for each one to bear his own loss. If the second should be true, there would be, in addition, the fact that the number of participants would be so small that no considerable advantage could accrue from a distribution of the losses. This is the reason that losses from floods, earthquakes, volcanic eruptions, avalanches, locust plagues and war are not proper objects for insurance, and why even insurance against the damage by hail storms has never become universal. The loss to be insured against must be, further, capable of estimation by statistics; it must occur with a certain regularity; the causes and occasions of its now frequent, now rare occurrence must be known. And even if these can not be traced back to certain natural laws, yet the "law of large numbers" must be applicable, and the long-continued and comprehensive observations necessary to ascertain this must not be neglected. Otherwise, there would be no basis for a decision as to the practicability of insurance, and as to whether and how far it would be advantageous; and thus the sine qua non of a sound insurance would be lacking. The science of statistics is, therefore, of great importance to insurance. With its development not only will the existing branches of insurance gain a firmer foundation and a wider extension, but it will render possible the establishment of new branches hitherto unknown. Thus it is possible that with the further evolution of the statistics of crime, insurance against theft, robbery, deceit, etc., will have a future, while, on the other hand, the failure of insurance against hail and the cattle plague to become as wide spread and firmly established as fire or life insurance is to be ascribed mainly to our present defective knowledge of their statistics. Finally, the injury to be insured against must be capable of easy investigation, both as to the manner of its occurrence and its amount. The exact investigation of its origin is especially necessary when it could have been easily caused by the insured party himself. —III. The Insurance Premium and its Standard. It has already been remarked that insurance is no one-sided transaction in which only one party gives and the other receives—it is not an act of charity. It rests upon service and counter-service, it is a contract. The service of the insured by which he acquires the right to indemnification for loss we call the insurance premium. It is the share of the total losses of all insured parties which the individual assumes when he joins the association. The premiums must also furnish the means of covering the running expenses, of accumulating the necessary reserves, of paying the interest on any borrowed capital which may be necessary, and, in case the insurance is undertaken as a business venture, of yielding a fair return on capital and labor to the undertakers. As a matter of course the amount of the premium can not be the same for every one insured, but must be regulated according to the eventual advantage which the insured party will get from the insurance. The value of the object insured is, of course, the most important element. The greater the value, the greater the injury which the loss of the same inflicts upon the possessor, and the greater the advantage which the latter derives from insurance. But there is also a second consideration. The insured objects are not all equally exposed to the danger, but some of them more and some less. In the former case the insured party will sooner and oftener be in a condition to make demands on the insurer than in the latter, from which it follows that in premium should be different in the two cases. The basis of the premium, therefore, is a double one, and consists in the value of the insured commodity and the degree of danger to which it is exposed. And it is only when the premium is fixed with reference to these two points that service and counter-service become equal. With a uniform rate of premium the possessors of the more valuable and more exposed property would have a great advantage over the others. The value of the insured object is generally easily ascertained and its determination can generally be left to the owner. For, as the premium varies with the value and is expressed in per cent. of the latter, and as the increase of the premium consequently tends to prevent over-valuation, there is no great danger in so leaving it, provided that no restitution shall be made in case of intentional destruction on the part of the owner, and that the sum paid shall in no case exceed the actual loss sustained. On the other hand, it is difficult to estimate properly the danger. This depends upon various circumstances and relations which can not always be foreseen. And even if these should be known, their effect is oftentimes very various. The degree of danger can be most easily determined in the case of life insurance, since it depends in this case upon the rates of mortality, with which we are tolerably well acquainted, owing to the statistics which have been carefully kept for several generations. In other cases we must rely altogether on the law of general average, which needs longer continued observations to establish it thoroughly, than any we have yet obtained. According as the insurance is temporary, i.e., relating to a single definite accident, or permanent, i.e., relating to such accidents in general for an indefinite period, the rate of premium will be different. In temporary or occasional insurances the rate varies merely as the sum of the actual or probable losses in one definite instance; in permanent insurances, on the contrary, as the number and extent of the losses during a giving period, generally a year. In permanent insurance the premium is, therefore, periodical and generally annual, and is paid regularly every year as long as the insurance continues. The premium, of course, like the payment of every other service, is subject to the law of competition, which begins to make itself felt when competing insurance companies meet each other in the same field. Economy in administration, great extent of business, which effects an evener distribution of losses, exactness and caution in insuring and estimating losses, careful regard to the degree of danger, and rejection of all hazardous risks, permit a reduction of the premium without depriving the institution of its ability to meet its obligations. —IV. Systems of Insurance. The various systems of insurance may be classed, in the first place, as public and private, according as the insuring party is the state (or municipality) or an individual, either alone or in union with other individuals. The respective merits of the public and private systems of insurance will be examined when we come to discuss the relation of the state to insurance. There is another division of insurance systems into the industrial and mutual systems. The former has been sometimes called the point stock or premium system. These terms do not seem very happy, inasmuch as a private individual or a political organization may adopt the industrial system, i.e., the system in which the business of insurance is conducted for the same purpose as any other business, viz., to make profits for the undertakers, and since in both kinds the premium appears. Nor does the term "mutual" seem to be a good one, since all insurance is mutual and could not exist on any other basis. The only difference between the so-called mutual and the industrial systems consists in the peculiar way in which the principle of reciprocity expresses itself. While in the former case every participant is at once insured and insurer, and thus the element of mutuality appears directly, in the industrial system this takes place through a third party, the insurance undertaker, who assumes the rôle of insurer toward all insured and receives from them the premiums. In this system insurer and insured are distinctly opposed to each other in consequence of a division of labor. Instead of the owners of property performing for one another the service of insurance, they have this done by a third party who makes a business of it, and whom they pay for his services. The real distinction between the two systems lies in the speculative character which the industrial system possesses, and must possess, but which the mutual system lacks. The better terms, then, would be, the speculative and non-speculative systems. —The mutual insurance system needs no capital stock. The means of repaying losses comes exclusively from the contributions, or premiums, of the members. If the losses increase, the premium must be raised in order to make full restitution, as it may be diminished with every decrease in the losses. The premium is, therefore, variable, and is determined by the losses to be made good. As no profit is intended, these two items correspond almost exactly, the premium including a small per cent., in addition, to defray expenses of administration. The simplest way to manage the mutual system is to reckon up, after the lapse of a certain length of time, the losses which have occurred within that period, and to distribute the amount necessary to make them good among the individual members in proportion to the value of their insured property and the danger to which it is exposed. The premiums are then paid in. Of course, there is no reference here to any estimation of probabilities in reference to the happening of any accident; the premium varies exactly with the actual losses incurred. On the other hand, annual premiums may be fixed which the insured parties must pay in advance, these to be determined with reference to the average of losses likely to occur within the space of a year. If the amount of the premiums exceeds the demand of any year, the surplus may be added to the reserve, or treated as a profit and written to the credit of the various members on their next premium. If the losses exceed the premiums, the deficit may be made up from the reserve, or, in case there is no reserve, must be made good by subsequent payments. —In the industrial or speculative system the premium is a fixed sum, by the payment of which the insured party secures the right of complete restitution under all circumstances, and nothing more. The insured can not be called upon to make good any deficit nor can he lay claim to any share in the profits of the undertaking. If the premiums amount to more than the losses and running expenses, the surplus belongs to the insurer as undertaker. It is his profit—the only consideration which can move him to carry on insurance as a business. On the other hand, if the premiums do not cover losses and expenses, the insurer must bear the loss himself; he has no further claim upon the insured. It makes no difference to the insured whether there are many or few accidents, whether the damage done is great or small. The responsibility of the insurer in this system necessitates a capital stock, which is usually collected by the sale of shares. The nominal sums are not generally paid up in full, but only from 10 to 20 per cent. of the same. It is seldom that further payments are necessary; for the premiums must equal the losses and running expenses. The amount paid up is used in getting a fair start, and if anything remains it constitutes a guarantee fund. The losses would have to be enormous if this fund could not cover them, or if it could not be easily replaced if it were necessary to take a portion of it. Masius makes the statement that in the course of forty years there was only one case in fire insurance and ten in hail insurance where further payments toward the capital stock were necessary. In order to be sure of punctual payment, however, in case of need, the shares are generally in the names of the shareholders, and these must bind themselves to make further payments, if called upon. The paid-up capital must, of course, pay ordinary interest, and the premium must be arranged with reference to that also. —Since the speculative system aims at a profit and can not exist without it, and since it needs, further, a capital stock on which it must pay interest, it does not seem probable that it can furnish insurance at the same rate at which the purely mutual system could do it, which does not care for profit and needs no capital. It would not seem, then, that the former could compete with the latter. For why should a man pay a higher sum than necessary for a given service? And yet we see that as a matter of fact the speculative system is not only able to compete with the mutual system, but is continually gaining ground upon it. Why is this? In the first place, the premium in the former is fixed; in the latter it is variable. Most men, if they have to make periodically recurring expenditures for any purpose, prefer a definite to an indefinite sum, as they know then what amount they must save and have at hand. And most men prefer to have the sacrifice which insurance demands measured in advance by a fixed sum, which they gladly pay even though it be higher than the average rate of the mutual system. For in this way they have one less variable item in their expense-list, and escape the unpleasant after-payments whose amount can never be determined beforehand. Further, and what is more important, the speculative companies, in spite of their profits and of their capital stock, often succeed in keeping their fixed premiums at the same height as the average rate of the mutual companies and sometimes even reduce them lower. They make this possible when they organize their administration simply, judiciously and economically; when they proceed with great caution in the acceptance of insurances, exclude objects of great risk altogether, accept very valuable ones only at a part of their value, and limit themselves to a certain amount in any one place; when they invest their premiums profitably and reinsure in other companies, and thus make them liable also. Of course, speculative insurance has the advantage over small mutual companies, since in the latter the distribution is not extensive enough to make the premiums reasonable. In short, here, as in other matters, the service which another renders us as a matter of business in return for pay, is frequently cheaper than that which we perform for ourselves. Some other advantages are claimed for the mutual system, but they are more apparent than real, and in no case important enough to give it the preference over the speculative system. A glance at the previous course of development leaves no room to doubt that the speculative system, even where it has as yet gained no foothold, is destined to take the lead. But it is desirable that mutual companies shall continue to exist side by side with the speculative companies, since their competition can not fail to have a good effect upon the latter, and they will find a wider field opening up to them whenever the speculative companies in their pursuit of gain lay themselves open to the charge of abusing the interests of the insured. —V. Branches of Insurance. Insurance is divided into several different branches, according to the kind of accident insured against or according to the object insured. The branches which have won a firm footing are fire insurance, hail insurance, animal insurance, transportation insurance, life insurance, mortgage insurance, glass insurance, and re-insurance. The limits of the present article forbid more than a brief notice of the two or three more important branches. —Fire Insurance covers those losses of property which occur through the destructive agencies of fire. Not every conflagration gives to the insured a claim against the insurer. If the fire arose from earthquakes or other unusual natural occurrences, or if it was occasioned by war or riot, no restitution is made, and of course none is made to him who caused the fire on purpose or through very gross carelessness. On the other hand, not only are damages paid which are occasioned by the fire, but those also inflicted in attempts to save the property. Fire insurance may be subdivided into insurance on buildings and on movable property of various kinds, including not only the furniture in a house but also instruments, machinery, supplies of agricultural commodities, etc. Some companies take both kinds of insurance, some only one kind. Certain objects are generally excluded from insurance, partly on account of their great risk, and partly on account of the difficulty of protecting the company from being cheated, such as powder mills, smelting works, glass factories, theatres, cash, bonds, stocks, etc. As in other insurance the premium varies with the value of the object and the degree of the danger. In the valuation of buildings the cost of rebuilding in case of total destruction is the standard. In the case of old buildings a deduction is generally made to allow for diminution in value from age. In the valuation of movable property the average price forms the extreme limit. Several circumstances affect the fire risk in buildings, such as the style of building, whether more or less fire proof; the business which is pursued in it; the commodities stored in it; the condition of the building and the purposes for which the neighboring buildings are used; the position of the building in reference to its distance from other buildings; finally, the condition of the fire companies and the means of extinguishing fires. Buildings are divided by the insurers into several different classes according to these circumstances, and the premium is graded accordingly. So far as movable property is concerned, the degree of risk is determined both by the kind of commodity and the character of the building in which it is stored. Full information on these points is absolutely necessary to a proper determination of the amount of the premium, and the applications for insurance to be filled out by the insured party should contain corresponding questions. The application forms are consequently of considerable importance, and the careful investigation of all statements made therein is a life-and-death question with the companies. This investigation is the business of the local agents who effect insurance in the names of the companies by which they are appointed. Very much depends, therefore, on the proper choice of such agents. The companies can be more secure if they require an official attestation to the truth of the statements in the application. Especial care must be taken to prevent the company from being exposed to loss by a too high valuation, or by insurance of the same object in several different companies. Over-insurance may be prevented, if the company never pays more than the loss actually suffered, and if the nominal sum is paid only in case it is equal to or less than the loss. Many institutions attempt to protect themselves by refusing to insure for more than a part of the value. This precautionary measure has the wholesome effect of leading the insured party to leave nothing undone on his part which may serve to prevent or diminish the injury; while, on the other hand, it has the great disadvantage that it does not fulfill the aim of insurance. A double insurance of the same object deprives the owner of all claim on either of the companies. As to the period of insurance, the mutual companies generally issue no policies for less than six months, and many of them not for less than one year. The speculative companies insure for one month or even less, but charge a higher premium for doing so, while they make, also, important reductions in premiums on policies which run for several years. After every fire which has destroyed insured property the company makes a careful investigation of the accident, not merely to ascertain the amount of damage done, but also to find out the cause of the fire, as in certain cases already mentioned, the company is under no obligation to pay the policy. —Marine Insurance is the most important form of transportation insurance. Its object is the partial or entire cargo of the ship and the ship itself. It insures against the accidents which may happen to a ship during the sea voyage. The danger of such accidents depends upon the length of the voyage and the time necessary to make it, upon the character of the route, the season, the condition of the ship, the crew, and the degree of security from piracy. An experience of several hundred years has established pretty accurately the average number of such accidents, and their causes in the various seas, and the influence of the season on their frequency. As to the condition of the ship, there are companies of underwriters in the chief commercial cities, particularly in London and Paris, which keep experts in most seaboard cities of any importance throughout the world, whose business it is to investigate every ship coming in as to quality, condition and seaworthiness, and send them the information. On the basis of this information they classify all the ships yearly. The registers they keep are open to all marine insurance companies for a small consideration, and as they all make use of them they are acquainted with the facts in regard to any ship applying for insurance. They thus have little difficulty in fixing the premium according to the risk. The premium varies, of course, in the first place as the amount of the policy, and the latter as the value of the insured commodities. In fixing the amount of the insurance, so far as the ship is concerned, not only is its value but also that of its equipments and the costs of fitting for sea taken into consideration. The amount of insurance on the cargo is measured by the invoice value of the commodities, plus the costs of transportation to the place of destination, plus the insurance premium and some other items, among which is often found an imaginary profit of 10 per cent. The amount of insurance must not exceed the valuation; if it should do so in any case the company is not liable for the excess. The liability of the insurer extends to "adventures and perils of the sea, men-of-war, fire, enemies, pirates, rovers, thieves, jettisons, letters of mart and counter-mart, surprisals, takings at sea, arrests, restraints, and detainments of all kings, princes, and people of what nation, condition or quality soever, barratry of the masters or mariners, and all other perils, losses and misfortunes that have or shall come to the hurt, detriment or damage of said goods, merchandise and ship or any part thereof." But the insurer is not liable for losses occasioned by unseaworthiness, insufficient equipment, ordinary wear and tear, age, rottenness, or worm-eatenness of the ship, by the condition, decay or careless packing of the cargo, or by the fault of captain if he be owner of ship and cargo. The insurer is liable also to the insured for his share of the general average, by which is understood all injuries intentionally inflicted by the ship master on the ship or cargo or both, in order to save them from a common danger, and also all expenses incurred for the same purpose, for which ship and cargo are liable in common. If the ship should be laid under embargo by a belligerent nation, the owner has the privilege, after a certain length of time, to cede his rights in the same to the insurer and receive the insurance in full. —Life Insurance is a misnomer, since it is not the life that is insured, but a certain sum of money which the insurer must pay to the heirs of the insured after the latter's death. There is a marked difference between life insurance and other kinds of insurance. The insurance of houses and goods against fire is a contract of indemnity against loss, and in like manner an insurance on human life may be regarded as indemnifying a man's family or creditors or others interested against the loss of future income by premature death. But it does not necessarily take the value of such income into account, nor does it relate to any intrinsic value of the subject of insurance, which is the life of the insured party. Again, in fire or marine insurance the loss may be either total or partial. In life insurance the event insured against can not take place in any limited degree, and there is thus no partial loss. And again (in the ordinary kind of life insurances), the event is certain to occur, and the time of its happening is the only contingent element. In other kinds of insurance the events are wholly of a contingent character. The ordinary case of life insurance is that in which the service of the insured consists in an annual premium, and the payment of the sum follows upon his death. The insurance may be effected upon a single life or upon two united. The insurance upon a single life may be permanent, if it exists for its whole period, or temporary, if it is effected only for one or more years or against some particular danger (such as would occur in a journey) without any reference to time. The insurance upon two lives (survivorship insurance) is effected in such a way that the insurance is paid only on condition that the first mentioned outlives the other. Other forms of survivorship insurances occur in which the amount is paid to the survivors of a series after the death of any member. A person is permitted to insure not only his own life but also that of another, although it is taken for granted that he has some special interest in the life of the insured party, growing out of business or relationship. Life insurance assumes other forms also. The insured party may invest a certain amount of capital at the time of paying his first premium, or his service may be limited to a single investment of capital. He may contract that the sum insured him shall be paid to him during his life after reaching a certain age, or when some accident may happen to him by which he becomes unable to work. Insurance can be effected for another party in such a way that a certain sum of money shall be paid to him on reaching a certain age. Such insurances are effected by the children's providence associations and the dowry associations. The children's providence associations accept either single investments of capital or yearly contributions from parents, which they make, as a rule, in the early years of their children's lives, and insure to the children a certain sum when they have attained their majority. The payments made for children who die before they become of age are forfeited to the associations, and the latter are thus able to increase the amounts insured to the survivors. In a similar way are managed the dowry associations, except that in the latter case the money is paid on the marriage of the insured party. Many other forms of life insurance might be enumerated—over forty different kinds have gained a more or less solid foothold—but our limited space forbids pursuing the subject farther. —Without the assistance of an insurance office the ordinary individual would not be able to collect as large an amount of capital as he can by its aid. Even savings banks and other credit institutions, by means of which even small savings become profitable investments, can not supply the place of insurance companies. As a man does not know how long he will live, he can not tell how much he must save each year in order to leave his heirs a certain amount of capital. But even if he could safely reckon on a long lease of life and should at an early period begin to save, it is questionable whether he would have strength of character enough to continue his savings in the way he began, and to resist the temptation to abridge or cease making them altogether and to consume what he had already saved. A man is too easily led to do one or the other when he has complete control over his own savings. One consoles one's self with the hope of soon being able to make up for lost time. Thus, after even a long life the fruit of saving is relatively very small. So much the more insufficient for the needs of the family must be the savings of him who is cut off early in life. Life insurance helps over all these difficulties. It secures to the individual a substitute for the guarantee of life which he can never have, by putting him in a condition in which the advantages connected with an average length of life are assured him, and by fixing his service with reference thereto; it keeps him from touching the savings accumulated, by depriving him of control over them; it prevents him from growing negligent in his economy by making him lose all he has saved if he fails to pay one premium; it offers him, finally, in the insured amount a return for the sacrifices he has made, which is on the whole far beyond the average which any other plan would offer him. The pecuniary means of meeting their obligations are derived by the insurance offices from several sources. They come, in the first place, from the premiums which those pay yearly who maintain their policies, then from the money coming to them from temporary insurances, when the person has escaped the accident against which he was insured; from survivorship insurances, etc.; from the premiums of lapsed policies, and of those which they do not have to pay on account of violation of contract on the part of the insured (such as suicide, death in duels, execution, etc.); finally, from the income of premiums, etc, which they invest as soon as they are collected, so far as they exceed running expenses. —The service of the insured party, the premium, varies with the amount of the insurance, and the earlier or later occurrence of the contingent event. As this event is generally the death of the insured, it becomes of the highest importance to ascertain how many years are likely to elapse between the time of taking the insurance and the death of the party. The most important element in this calculation is the age of the party insured, as on an average a young person has a longer life before him than an older one. The insurance offices must, therefore, obtain exact information as to the expectation of life at different ages. This knowledge, without which its whole work would be unsound, is furnished to a satisfactory degree by statistics which can boast of greater success in this field than in any other, and has given life insurance a firmer foundation than any other form of insurance. Statistical observations on the rate of mortality at the various ages, and on the average duration of life, are tabulated in the mortality tables, which, beginning with a fixed number of persons of the same age, show for each year the proportion of deaths in that number and the expectation of life of the survivors. The first mortality table was constructed by Halley in 1693. Many others have since been published. The later ones, of course, are more valuable, since they are based on a larger number of cases, and because there has been a marked change for the better both in the rates of mortality and in the expectation of life within the present century. Many companies now use the seventeen offices' experience table, constructed in 1840, and based upon the experience of seventeen offices from 1762 to 1840, embracing 83,905 policies. With the aid of such tables the premium can be determined, so far as the probable time of the death of the insured is concerned, with almost exact mathematical accuracy, for all the different ages. The general rate of mortality is, however, affected by all sorts of modifications, such as the condition of health, the mode of life and the occupation of the different persons. It is necessary, of course, to take all these points into consideration in passing upon individual applicants. Weak and sickly persons, particularly those suffering from chronic diseases, as well as those engaged in dangerous occupations, are very properly excluded from insurance. As a consequence, not only the agents of the company but physicians also must be consulted in each case, and their decision considered. In recent times some companies have been formed to insure the lives of such as are ordinarily rejected, but it goes without the saying that such institutions rest on a very insecure basis and can not probably increase to any great extent. The minimum and maximum of insurance effected on one life by one company is often fixed by their rules, so as to prevent, on the one hand, the accumulation of small policies attended with a relatively great expense of administration, and on the other, the payment of many large sums at once which might endanger their solidity. —The reserve is an object of great importance to life insurance companies. Those who take out policies for life or for several years continue to pay the same annual premium which was fixed with reference to their ages on entering. They ought really to pay a lower premium at first, and as they grow older a higher one. The establishment of a uniform premium for the period of insurance which is calculated as the average of their yearly service, means, therefore, that in the early years they pay more, and in the later less, than the average rate of mortality would demand. It is necessary, therefore, for the company to save up the surplus received in the early years to cover the deficit of the later ones, when the risk increases. This accumulation is called the premium reserve. No solid institution with an eye to the future can afford to neglect it; it is one of the conditions of continued existence. —Since the great development of railroads the Accident Insurance Companies have grown rapidly. A company was established in London, in 1849, for insuring against the consequences of railway accidents. In 1856 the business was extended to all sorts of accidents, and there came into use a system of premiums graded according to the risk supposed to attach to various conditions and occupations of life. Many other similar companies have been established in nearly all civilized countries, and their business is growing rapidly. —Annuity Insurance is opposed to life insurance in two respects. While the latter insures the possession of new capital, the former converts capital on hand into yearly payments. And so, in life insurance the service of the insurer is not performed until after the death of the insured, while in annuity insurance it ceases at death. The early death of the insured is, therefore, as desirable to the office in the latter case as it is undesirable in the former. There are many different kinds of annuity insurance. The simplest form is that in which the payment of an annuity is assured until death to a person in return for the deposit of a fixed amount of capital. The insured begins to receive the annuity at once or at some later period, usually after reaching a certain age. An annuity payable in the future is called a deferred annuity. The claim to an annuity of the latter kind can be acquired by yearly payments. The amount of the annuity depends upon the amount of capital invested, and the yearly payments (if any), upon the rate of interest, upon the time to elapse between the contract and the beginning of the annuity (in the case of deferred annuities), and, finally, upon the probable duration of the annuity, which, since it ends with the death of the insured party, is determined from the mortality tables. An annuity can be insured to a company of persons as well as to individuals. If it be given in such a way that the annuity of each member after his death is divided among the survivors until the last survivor receives the annuities of all, it is called a tontine. This system of annuities has been adopted by several companies. Annuity insurance enables the insured to receive a higher return on his capital, either immediately or in his later years, than the ordinary rate of interest would give him, or to secure to his family after death a considerably larger income than he could usually accumulate and leave them. He could not do this from his own resources, but the annuity office offers him this opportunity—at the cost, it is true, of the loss of his capital, which becomes the property of the office. The resources of annuity offices are in general the same as those of life insurance companies. —The other forms of insurance, although in some places well developed, are, compared with the preceding, unimportant. The guarantee of employers against the fraud or insolvency of their servants, has become of late years of considerable importance, carried on by the fidelity guarantee offices. Companies have been formed to insure against loss by hail, loss by cattle plague or horse diseases; to insure traders against loss from bad debts, money-loaners against loss from mortgages, etc., tradesmen against loss from breakage of plate-glass in shop windows, etc., etc. The practice of re-insurance has developed of late years into great importance. No one company, however large its resources, deems it prudent to undertake a risk to an unlimited amount in connection with any one locality or one kind of goods. An office might restrict its liabilities by refusing to insure to a larger amount than what it pleased to run the risk of, and although some offices have done so, yet the convenience of the insured and the interest of its own agents, to say nothing of other considerations, make it difficult for any office so to limit its responsibilities. It, therefore, issues a policy for the amount proposed to it, but reinsures a part with some other office or offices. Business to a very large amount is exchanged in this way, and there are some offices which professedly, and others which practically, live by the premiums paid over to them by other offices. Such a plan has many plain advantages for the public. It saves a man, among other things, all the trouble of hunting after offices willing to take heavy risks, since any one will take it. —VI. The Economical Significance of Insurance. It would be a chimerical idea to expect from insurance companies that they would undo the work of destruction, restore the destroyed values, and thus make good immediately the loss to the national wealth. No power on earth can do that. What has been destroyed remains destroyed; what has been done can not be undone. The only thing that we can get from insurance is a substitute for what has been lost. This substitute can come only from the stock of existing capital, and must therefore produce gaps elsewhere. The one loss can be made good only by other losses. The great significance of insurance, its inestimable service, consists in this, that it enables us to furnish a substitute without diminishing the capital employed in production. The premiums furnish the means of indemnity, and they are so small in proportion that they can be saved from the running expenses. Destroyed capital is, therefore, by the aid of insurance offices, replaced by small surpluses of income, by small savings from personal expenses. And thus those far-reaching disturbances are avoided which the loss of so much capital would have caused in the national economy, since the individual injured would scarcely be able of himself to cover his loss without the use of his own or another's capital, and would, therefore, if not assisted, be compelled to limit his production. Of course, the accumulation of new capital is delayed by this method of indemnification, since the savings employed in paying premiums would often be invested. But a great point is gained if the existing capital is preserved unimpaired. The loss need not in that case affect the rate of interest on capital. Production suffers no limitation on its account, and there is, therefore, no diminution in the demand for labor—an unmistakable advantage for the laboring classes. And as the loss of invested capital may be prevented by a small outlay, insurance effects a material reduction of the industrial risk and consequently of the undertaker's profits, contributes thereby to an increase in the number of competing undertakings, and leads ultimately to lower prices of products. This is particularly true of commercial wares brought from a distance which could never be furnished so cheaply were it not for insurance. And thus production and consumption derive incalculable advantage from the way in which insurance companies procure the substitutes for the destroyed values. Without going any further into detail we may say that insurance has conferred the greatest immediate benefits on commerce, navigation and agriculture. Commerce and navigation could never have attained to their present wonderful development (a development of which antiquity and the middle ages never even dreamed) if transportation insurance had not stood by and taken upon itself the liability even into the most distant seas, for the danger which hourly threatened ship and cargo. As to agriculture, there are two branches of insurance which exist for its sake alone—animal and hail insurance. The former protects a very considerable and valuable portion of agricultural capital, the latter protects the agricultural product through all the stages of its growth until its maturity and its harvest, upon which fire insurance continues this service until its consumption or its sale, while it secures, at the same time, the dwelling and working buildings of the farmer. But the advantage of insurance does not cease with what has been said, it reaches much farther. By replacing the lost capital and thus preserving production in its usual course, it contributes to the extension of credit which sets in motion the power of capital, makes it accessible to unpropertied brains, and increases production to the full extent of existing capital. By insurance the insured gains more credit, and the danger of giving credit is less to the creditor. This effect is visible enough in the case of owners of buildings which are insured. It is still plainer when credit itself becomes the object of insurance, as in mortgage insurance, which enables a landlord to exploit his credit to its extreme limit. Insurance does not limit itself, however, to the mere work of replacing lost capital; it appears in one of its chief branches—life insurance—as the accumulation of new capital. Of course, we might feel tempted to oppose to life insurance as the accumulator of capital, annuity insurance as the destroyer of capital. And yet in spite of the fact that the latter has some dark sides, and sometimes in the case of tontines degenerates into a mere game of chance, it has its unmistakable advantages, which make it in more than one respect a necessity. There will always be a great number of persons who will be much better provided for, much more effectually secured against poverty by means of an annuity than by a fixed sum of money. Of what advantage to a person unable to work, or to one economically untrustworthy, is the possession of a certain amount of capital if it is not large enough for him to live on the interest of it. He can not employ it himself, and is consequently much better off in possession of an annuity. If, moreover, the interest on the capital which a man possesses is not sufficient to support him, and, in lack of any other source of income, he is compelled to encroach on his capital, a systematic consumption of the same, such as is secured to him by an annuity, is certainly much more advantageous to him, because it secures him a higher rate of interest until his death, while without its assistance in the uncertainty of the length of human life he is exposed to the danger of consuming his capital prematurely and coming to want in his old age. Life and annuity insurance exercise, moreover, beneficent influences which extend beyond the sphere of economical life, and are yet indirectly of great importance to it. The father is thereby freed from the tormenting fear of leaving poverty and distress as a legacy to his family, or of seeing them suffer when he, on account of age, has become unable to work. By comparatively small annual payments which he can save from his income, or by a small investment of capital in such an institution, he can secure a round sum of money or an annuity which will raise those dependent upon him above the fear of poverty or will procure for himself a pension in his old age. This prospect increases his self-confidence, encourages industry and saving, keeps him from useless expenditure, and favors the growth of an economical sense. Life and annuity insurances, therefore, contribute essentially toward establishing happiness and content in the family, and to strengthen the family spirit—that pillar of all social and political order. This moral influence inheres indeed in all branches of insurance, since all insurance rests on the basis of self-help, which has an undeniably moral value, not only on account of the above-mentioned personal and material conditions which every one who wishes to take advantage of it must realize in and about himself, but also in view of the effects it has upon him. It raises him above the sad necessity of relying in misfortune upon the pity and charity of his fellow-men, and saves him from the humiliating feeling connected with it. Whoever receives alms from others has lost his independence and can no longer consider himself their equal. In the consciousness of equality and independence lies the richest source of moral improvement Insurance, by opening up the way to an effectual self-help in a wide sphere, becomes, therefore, a moral educator, and a political one as well, since a free state in order to continue must have self-responsible, self-helping citizens. But quite as striking as the moral side of this self-help is the economical side. It reveals to us insurance as a contrivance which counteracts pauperism with a marked success. In numberless cases pauperism springs from such misfortunes as are the objects of insurance, and whose consequences can be avoided by taking advantage of it. If there were a universal participation in the various branches of insurance the sacrifice which the support of the poor demands of society would be very much less, and the public support of the poor, which is of very questionable advantage, and, therefore, condemned by many economists and statesmen, would be largely unnecessary. The presence of insurance offices in such numbers as to make them accessible to all, would justify the state in refusing public aid in all misfortunes against which they insure, for the sufferer who has neglected to insure is responsible for his own loss. When we consider, further, that we owe to fire insurance a better condition of our buildings, all sorts of precautions against fires particularly in manufacturing districts, and essential improvements in the fire extinguishing systems (which are in some places in the hands of the insurance offices); that transportation insurance has improved the construction of ships and other means of transportation; as well as contrivances for saving lives and goods in shipwrecks; and that animal insurance has led to a better treatment and a more careful management of animals, to greater attention to all kinds of animal diseases, and more frequent recourse to veterinary help; we can hardly doubt that insurance should be classed among the most beneficent and public-spirited devices which the mind of man ever conceived. —VII. The State, and its Relations to Insurance. The first question arising in this connection is, naturally enough, Should insurance be a public enterprise undertaken by the state or municipality? Insurance was first introduced into many of the continental nations by the government, and for a long time nearly all insurance was effected by the state. Even now many cities and states carry on some particular branches of insurance. The history of insurance justifies us in laying it down as a rule, with few exceptions, that the state should not attempt to perform the office of insurer. Wherever private institutions have been allowed to compete with public ones they have slowly but surely driven them from the field in spite of many obstacles placed in their way. Nor is this surprising. The state is not suited to prosecute speculative insurance, because it lacks all those qualities which are necessary to the profitable pursuit of an industrial undertaking. The zeal animating a private undertaker to attain the greatest possible results with the least possible expenditure, and to appropriate to his own use without delay for this purpose every technical improvement, is foreign to the state, nor has the latter the same watchful eye for the wants of the public as the former. Since the industry must be carried on by hired servants whose slack zeal needs constant supervision, everything which the state undertakes in the commercial or industrial field acquires a character of painful smallness and clumsiness; everything bears the stamp of bureaucracy instead of commerce. The state spends more and accomplishes less, and consequently it is at a disadvantage as compared even with those private associations which seek to satisfy their need of insurance by mutual institutions. For a private association has more freedom and less expense of administration. From which it is clear that those are seriously mistaken who expect a cheaper and better service from the state in such matters than from private companies. There are circumstances, however, we must admit, which not only justify but demand public insurance. If public spirit and a tendency to association are lacking in a people; if the desire for far-reaching undertakings has not shown itself, and at the same time an appreciation of the advantages of insurance has not yet grown up; in a word, if all the presuppositions of the establishment of insurance offices by private parties are wanting, then the state may wisely take the initiative and proceed with the institution of public offices. Otherwise, the nation might have to wait much longer for the introduction of these beneficent institutions. And yet, even in such cases, the state should aim at educating the people as soon as possible to such an extent that private enterprise would take the business off its hands. —It is interesting to notice the very different attitudes of various governments toward insurance. Continental states began, as a rule, with the closest and most detailed supervision of the insurance business. To examine their laws on the subject, their limitations, prohibitions, precautions, etc one would think that they were intended to make a dangerous enemy harmless, instead of being intended to control one of the most beneficent of human institutions. Continental progress has constantly been toward a broader liberty, toward less interference. England, on the contrary, and particularly the countries of the new world, began with the utmost liberty and have been moving toward a limitation and supervision of the insurance business. Neither party will ever reach the point from which the other started, nor can it be said that any state has yet reached the true policy in reference to public control of insurance. Our American states have tried numberless plans, all of which have proved to be complete or partial failures. Nor has any scheme been devised of preventing huge frauds from being perpetrated on the public in the name of insurance. Governments have not even been successful in securing full publicity. Government inspection is open to the serious objection that, while it is notoriously unsuccessful and inefficient, it yet lulls the public into a false security as to the stability and soundness of inspected companies. The attempts of our state governments to control the insurance business have often had the effect of embarrassing and endangering perfectly sound companies and knocking the foundation of a solid business from under them. The legislation has been uniformly in the supposed interest of the policy holder. But, as often happens in legislation for a particular class, the matter is carried too far and results in injury where benefit was intended. Thus, any control which seriously increases the cost of insurance must redound, in the long run, to the disadvantage of the insured. Laws to prevent the forfeiture of insurances by the failure to pay premiums, and regulating the payment of surrender values and the grant of paid-up policies, are too favorable to withdrawing members and tend to weaken the companies by encouraging the retirement of the most healthy and profitable lives. In a word, the tendency of state supervision is "to interfere injuriously with honest and well-conducted companies and to afford but a feeble protection against those of a different class; to involve the state in the odium of failures which it is supposed to be its duty to prevent; to lessen the sense of responsibility among those who control the offices and the spirit of prudence and watchfulness among the public; and to place in the hands of public officials a power and influence which are apt to be abused and are always open to suspicion." —VIII. Literature. The literature of the subject is large and constantly increasing. The articles on insurance in the various general cyclopædias contain brief and interesting summaries of information on special points. The article on Versicherungsaustalten in Bluntschli and Brater's Staatswörterbuch formed the basis of the present article, portions of it being simply an abridgment of the former. A very full summary of the literature on the subject in German is appended to the article just mentioned. All the standard works on political economy in German contain sections on insurance, treating it among the promoters of production. The special cyclopædias, in German, French, Italian and English, treat the subject with more or less completeness. Among the works in English the following deserve especial mention: the Insurance Cyclopœdia, by Cornelius Walford, a work now in progress and covering the whole subject of insurance; the British Blue Books, containing full information as to all British companies; the Reports of American Commissioners in the various states; Insurance Handbook, by Cornelius Walford; the Law of Fire Insurance, by C. J. Bunyon; Observations on the Rate of Mortality of Assured Lives, by James Meikle; the publications of the institute of actuaries in England; and the various periodicals published in the interests of insurance in Great Britain, Germany, France and America. E. J. JAMES. INSURRECTIONINSURRECTION. Of all the trials to which political societies are unfortunately submitted before attaining their final constitution, the armed revolts attempted by minorities, either to obtain concessions from the ruling power, or to deprive it of its very authority, are not the least. When parties engage in strife with one another, insurrection is, so to speak, the last resource of the vanquished, and by its means force and audacity frequently triumph over right and reason. But if, on the one hand, history recalls instances of disastrous disorder, caused by popular revolt, it tells us also that, at periods of social transformation, the most certain elements of political progress have been produced many a time by insurrections. When despotism, thanks to the reaction which always occurs in a single day of these violent shocks, has not been able to strengthen itself, the bold attempts of minorities, who are forced to act against the laws, have the happy effect of robbing absolutism of all its prestige, and of hastening the realization of the conquests which public opinion had demanded in vain. —We repeat, it is only in transformation periods that these phenomena can prove beneficial. As much as we applaud them then, just so much must we mistrust or resist them when progress, guaranteed by the institutions themselves, can follow its normal course. Nothing, therefore, can justify insurrection in principle, neither recollections of the past, nor any laws the parties may invoke. Robespierre has pompously styled it "the holiest of duties"; it is in reality neither a right nor a duty, but at most, under given circumstances, a sad necessity. And these circumstances must be carefully studied, in order that the responsibility for the results may always rest upon the authority which provokes them, and not upon the men whom they let loose upon a society already threatened. We here anticipate a sort of displacement of rights, or inversion of their order, that is, the case in which the government, being assailed, itself sets the example of rebellion, by the arbitrary suppression of constitutional rights, and the promoters of an insurrection find themselves the natural defenders of the laws and institutions—It is true, perhaps, that by this doctrine we still leave a wide door open to popular excesses. What party will not be ever ready to invoke, for the benefit of its passions, the exceptional circumstances which place on its side the merit of a grand initiative? What facilities do not bold agitators possess to lure the excited crowd on to their path, and urge them to a resistance so much the more energetic and violent as the means used consist entirely in working upon popular credulity and ignorance? It is natural for low minds to seek the realization of their hopes in the most brutal exercise of their rights. —But these fears will gradually disappear, for the favorable opportunities formerly left to turbulent or audacious minorities are made fewer every day by the concessions made to democracy, and especially by the introduction into all political constitutions of guarantees for the free expression of the popular will and of respect for the same. One might say that the masses can henceforth, in the struggles which may arise between themselves and the authorities, seek shelter under a more worthy rampart than the barricades of the highways, we mean the rights, every day more extended, whose peaceful and steady use has made of them an arm ever raised against arbitrary power and despotism. When embodied in constitutions, these rights paralyze revolutionary efforts and destroy beforehand the ambitious calculations of those who foment insurrections. —France is perhaps the country in which popular insurrections have occurred most frequently. After France comes Spain. But in Spain, as all know, these uprisings have generally been of a military character, stirred up by pretenders or by chiefs of parties, the prime movers being officers of the army, opposing flag to flag, or waving the national flag at the very foot of the throne. Italy also has had her bloody pages, the saddest of which is one which dates from the epoch of her political reconstruction, and bears inscribed upon it the name of one of the most popular heroes of Italian independence. Insurrections are not unknown in Germany, nor even in Switzerland; Belgium is itself the fruit of a popular uprising. In Spanish America, examples are even of more frequent occurrence than in Europe. The South American republics, not firmly established or badly governed, found from the beginning that they had borrowed from European civilization the most lamentable excesses of political agglomerations. —So much for what we call internal insurrections. There are others of which we will speak here. The reader will readily divine that we refer to those insurrections that are fomented by a whole people, and have for their object either to break a federal compact, or to abolish treaties which weigh down a vanquished nation. These occupy in history a place apart. They very frequently involve all political and social equilibrium, by calling into question again an organization which had been established at the cost of great labor and care. On the continent of Europe they have often led to the alteration of ideas of diplomacy and given rise to important questions of principle. The first of these questions is that of the enfranchisement of nationalities, which immediately provokes inquiry as to the right of intervention or nonintervention. —The principle of nationality can not be made the subject of particular observations in this article. (See NATIONALITY.) Let us merely state that it is in this principle that these national insurrections, which are to internal insurrections what riots are to revolutions, find their source. In like manner, we shall not dwell upon the principle of intervention, whose application may exercise a direct influence upon the results of an insurrectional movement. (See INTERVENTION.) In general, we think that all interference on the part of foreign governments in the affairs of a country where questions of partial enfranchisement or of restoration are being agitated, is blameworthy. If there be diplomatic action in favor of any cause, it is proper in certain cases, and the law of nations enjoins it whenever the rights of humanity and civilization are involved in the political interests of the debate. But, beyond this moral intervention, it is apt to lead to a breach of international pledges, respect for which forms the basis of political societies. —To sum up, the insurrectionary movements that have occurred in the past seem to have been, not unfrequently, explosions which a careful authority would have easily prevented, by making honorable concessions, or by allowing greater liberty to political life. When nations have been compared to the impatient and restive children of a family, over whom paternal severity is called upon to exert itself, it should have been added that none of these régimes in which no account is taken either of age or temperament, should have been applied to either one or the other. Nature which has its wants, has also its revolts. Thus it was that insurrections were nearly always the consequence of restrictions too long imposed upon the satisfaction of the wants of nations, and thus it is also that we see them nearly always preceded by the same phenomena. Let us hope, therefore, that the progressive extension of public liberties will entirely prevent the return of those catastrophes, formerly of periodical occurrence in certain countries; for liberty is ever the best preservative against excesses of every kind. The evils attendant upon liberty, carry with them their own remedy, and nations can be really educated only under a system which facilitates the combined action of all minds and forces. ERNEST DRÉOLLE. INSURRECTIONINSURRECTION (IN U. S. HISTORY.) I. The constitution (Art. I., § 8, ¶¶ 11-16,) has given power to congress to declare and maintain war, and to provide for organizing, arming and calling forth the militia to execute the laws, suppress insurrections and repel invasions. The power has been exercised, 1, by the passage of the several general acts hereafter specified, and 2, by the suppression, through the president and the federal forces under his command, of two insurrections. (See WHISKY INSURRECTION, REBELLION.) —The act of May 2, 1792, authorized the employment of militia by the president to suppress insurrections, upon notification by a federal associate justice or district judge that the execution of the laws was impeded by combinations too powerful to be suppressed by the ordinary course of judicial proceedings. The act of Feb. 28, 1795, amplified the foregoing act by authorizing the president, on application of the legislature of a state, or of the governor when the legislature could not be convened, to call forth the militia of other states to suppress an insurrection against the government of the state. The act of March 3, 1807, provides that, "in all cases of insurrection or obstruction of the laws, either of the United States or of any individual state or territory, where it is lawful for the president of the United States to call forth the militia for the purpose of suppressing such insurrection, or of causing the laws to be duly executed, it shall be lawful for him to employ, for the same purposes, such part of the land or naval force of the United States as shall be judged necessary, having first observed all the prerequisites of the law in that respect." It is important, therefore, to remember that the "prerequisites" under this act were, 1, the notification of an associate justice or district judge that the execution of the laws is obstructed, or 2, the application of a legislature or governor. No further provisions against insurrection were made until 1861. —The breaking out of the rebellion brought out a state of affairs unprovided for by law. None of the governors or legislatures of seceding states were at all likely to call for federal interposition; the district judges in those states, as well as one of the associate justices, had resigned; and no associate justice appears to have notified the president that the laws were obstructed—at least there is no assertion of any such notification in the president's proclamation of April 15, 1861, calling for 75,000 militia. It is apparent, then, that the "prerequisites" for calling forth the militia, or employing the regular forces to suppress insurrection, had not been observed; and that the proclamation, though the war department's notification to the state governors based it on the act of Feb. 28, 1795, could not be defended by referring it to that or any of the other acts above referred to. —The proclamation, however, and the other steps to suppress the insurrection which were taken before the meeting of congress in July, have a different ground of justification in those clauses of the constitution which make the president commander-in-chief, and direct him to "take care that the laws be faithfully executed." His powers and duties under these clauses can hardly be more clearly stated than in the opinion of the supreme court in the case of The Brilliant cited below. "If a war be made by invasion of a foreign nation, the president is not only authorized but bound to resist force by force. He does not initiate the war, but is bound to accept the challenge without waiting for any special legislative authority. And whether the hostile party be a foreign invader, or states organized in rebellion, it is none the less a war, although the declaration of it be unilateral. * * * The president was bound to meet it in the shape in which it presented itself, without waiting for congress to baptize it with a name. * * * Whether the president, in fulfilling his duties as commander-in-chief, in suppressing an insurrection, has met with such armed hostile resistance, and a civil war of such alarming proportions, as will compel him to accord to them the character of belligerents, is a question to be decided by him." (See WAR POWERS.) —The unusual circumstances of the case, and the criticisms of some of the president's measures (see HABEAS CORPUS), induced the passage of the act of Aug. 6, 1861, whose third section approved, legalized and made valid all the acts, proclamations and orders of the president after March 4, 1861, "to the same intent and with the same effect as if they had been issued and done under the previous express authority and direction of the congress of the United States." This validation seems hardly more necessary in this case than in that of a neutrality proclamation; it was given more effectually and more properly by the act of July 13, 1861, restricting intercourse with the insurrectionary states, the act of July 29, 1861, authorizing the employment of the militia and land and naval forces to suppress insurrection whenever it should become impracticable, in the judgment of the president, to enforce the laws by ordinary process, and the various acts appropriating men and money for the support of the president in suppressing the rebellion. (See REBELLION.) The dividing line between the functions of the various departments of the government in making war and in suppressing an insurrection is not a bold one, and yet it is not difficult to trace it, except where it is obscured by party passion. —The power given to the president by the enforcement act of April 20, 1871, to suspend the privilege of the writ of habeas corpus, and to employ the militia in suppressing any combinations which, in the judgment of the president, should prevent the execution of the laws, and the provision of the same act that such combinations should "be deemed a rebellion against the government of the United States," were more objectionable on the question of expediency than on that of constitutionality; the strongest arguments against them were drawn from the bad character and untrustworthiness of many of the executive agents in the south, on whose report the provisions of the act were to be put into operation. (See generally, EXECUTIVE, CONGRESS, WAR POWERS, RECONSTRUCTION, CIVIL RIGHTS BILL.) —II. DOMESTIC INSURRECTION. The constitution (Art. IV., § 4) makes it the duty of "the United States" to guarantee a republican form of government to every state, and to protect each state against invasion and against domestic violence. No evidence of invasion is required; the application of the state legislature, or of the governor when the legislature can not be convened, is to be taken as evidence of domestic violence. As the duty is imposed upon "the United States," it is imposed not upon any one department alone, but upon all—upon the federal courts in their decisions, upon congress in its legislation, and upon the president in his execution of the laws. —It would be easy to name many forms and features of government which are not republican; it is not at all easy to define a republican form of government as intended by the constitution. The essence of it seems to be in the untrammeled existence of a legislative department chosen by popular vote. So long as this feature is present, the United States do not interfere to correct abuses, or what seem to be abuses, which the people of the state do not care to correct. To do so would be to keep the people of the state in a condition of pupilage far more emasculating and inconsistent with the idea of a republican government than the abuses from which they had been rescued. If the people of a state, as represented in their legislative assemblies or constitutional conventions, choose to limit the suffrage unreasonably, or to disfranchise for petty offenses, or to entrust the count of their votes to irresponsible boards, these are evils which involve their own punishment and ultimate correction. (See SUFFRAGE, RETURNING BOARDS.) So long as a state remains peacefully in the Union, and its state constitution or legislature does not assume to exercise powers prohibited by the constitution of the United States, to establish a state church, or to grant hereditary tenures of office, it is difficult to conceive of any alteration in their present forms of government which would be considered unrepublican or demand the active interference of the federal government. —When a state, by the action or acquiescence of a majority of its people, undertakes to sever its relations to the Union, the case is very different. As the controlling theory of the American system of government is that a state has no existence apart from the Union, the action of the people of the state is taken as a voluntary abrogation of their state government; it then becomes the duty of the federal government, in its various departments, to fulfill the guarantee of the constitution, and in reconstructing the state governments the law-making power may rightfully reject any features which seem to it unrepublican. If there is any hardship in this, the blame must fall upon those who made the reconstruction necessary. (See RECONSTRUCTION.) —It is still more difficult to define "domestic violence." It is easy to see that such outbreaks as Shays' rebellion, which occasioned the insertion of this section (see CONFEDERATION, ARTICLES OF), or the railroad riots of 1877, are cases of domestic violence, and that such a struggle between two opposing parties for the possession of the state government as that which occurred in Maine, in 1879-80, is not; but it is difficult always to draw the line exactly between the two classes of cases. The general rule may be laid down that the federal government will not recognize the subversion of a form of state government, which it has once recognized as republican, until the subversion is accomplished according to the rules of the established form, and that it will support the established form of government against all irregular attacks upon its existence. But when the validity of the form of government is undisputed, and the conflict is between opposing parties for the control of it, the federal government will not interfere unless actual violence occurs, and then only to prevent anarchy and maintain the status quo until the people of the state can speak and decide. The rule is open to the obvious objection that evil men, in control of the machinery of a state government, might easily provoke violence by efforts to retain it after a defeat at the polls, or, when out of possession, might similarly provoke violence by illegal efforts to obtain it: but this is the common and underlying peril to all republican governments, and, when a state is unable to surmount it, it is unfit for a republican government. It would be unfair to quote precedents for or against the rule from the revolutionary period, hereafter referred to, which immediately succeeded reconstruction; it is sufficient to say that no state now appears to be thus unfit for republican government, and that the future prospects are for improvement, not for deterioration in this respect. —The "domestic violence" clause was practically a dead letter until after the suppression of the rebellion, and is only lightly touched upon in the treaties upon constitutional law published before 1870. The disturbances in Pennsylvania in 1794 were not aimed at the state government but at the government of the United States; they were therefore suppressed by the president's direct action, on the certificate of the federal judge, and without any call from the state authorities. (See WHISKY INSURRECTION.) In 1838-42 two appeals were made by governors, one from Pennsylvania, and one from Rhode Island. (See BUCKSHOT WAR, DORR REBELLION.) In the former case federal interference was refused; in the latter case it was held in readiness, though it proved unnecessary, and the power to grant it was maintained by all the departments of the government. The two cases deserve study as fair examples of the propriety and impropriety of federal interference. Throughout the war the legislatures and governors of states in sympathy with the federal government had no occasion, and those opposed to the federal government had no desire to call for federal interference. Throughout the period of reconstruction, 1867-70, there were no recognized state legislatures or governors in the unreconstructed disturbed states; but military assistance was furnished from Washington to federal marshals, whenever necessary, under the provisions of the reconstruction acts, the civil rights act, and the freedmen's bureau act. (See titles of acts named.) —From the completion of reconstruction until 1877 federal interference to sustain the reconstructed governments was in constant demand. In almost all the states a regular sequence of events took place: 1, the formation of a state government under which negro suffrage was permitted and former rebels were, in some of the states, disfranchised (see SUFFRAGE); 2, the election of a republican governor and legislature; 3, disorders in the election of the legislature for the purpose of securing a majority in that body for the impeachment and removal of the governor; and, 4, an appear by the governor or legislature for federal troops to keep the peace. In Florida and Georgia the final step was not taken, as the republican administration was ousted peaceably. In many of the states there were variations in the process, usually from the utilization of the state courts in the political struggle; but the general course of events was as above given. —The process began in the first state reconstructed, Tennessee. From July, 1866, until December, 1867, frequent applications were made to Gen. Thomas by the governor for troops to keep order at elections and elsewhere, but these were refused, except as posses in aid of the civil authorities, since no insurrection was alleged. In 1869 the legislature passed under control of the democrats, and in February, 1870, the governor applied to the president for troops, on the ground that the legislature was unwilling to suppress violence. This, however, was designed rather to influence congress to again undertake the reconstruction of the state, and when congress refused to interfere, the application for troops was not renewed. —In July, 1870, Gov. Holden, of North Carolina asked for and received troops to suppress insurrection in two counties of his state, and in November of the same year Gov. Smith, of Alabama, informally obtained a platoon of federal soldiers to aid him in resisting the inauguration of the opposing candidate. In January, 1874, Gov. Davis, of Texas, applied for troops to aid him in preventing the meeting of a legislature which, he asserted, had been illegally elected, but the request was refused. April 19, 20, 1874, application for federal troops was made by both the rival claimants of the office of governor of Arkansas, but this was refused until the legislature met and decided in favor of Baxter. (See ARKANSAS.) In November, 1874, V. V. Smith, lieutenant governor of Arkansas, claiming to be governor because of Gov. Baxter's submission to his supersedure by the new constitution, called upon the president for troops, but as he fled from the state immediately afterward, his request was ignored. Sept. 8, 1875, Gov. Ames, of Mississippi, called for troops, but was advised to call the legislature together and defend his state and constituents. —The two states from which federal interposition was oftenest called for during this period were Louisiana and South Carolina. The disturbances seem to have been caused mainly, in the former state, by the extraordinary, rigid and inquisitorial restrictions upon the right of suffrage in the original reconstructed constitution of 1868, and, in the latter state, by the preponderance of the negroes in the numerical vote and of the whites in the tax paying class. (See the states named) Louisiana really led in direct applications to the president, the first having been made in July, 1868, and the step was then so unusual and so little understood that the legislature at first mistakenly addressed the application to the general of the army at Washington, ignoring the president; and Gen. Grant, in sending instructions to the commanding officer of the Louisiana department, felt obliged to detail at length the constitutional provisions and acts of congress covering the case. In 1872 the republican party of the state split, and the Packard-Kellogg faction, securing the support of the most influential federal office-holders in the state, secured with it the support of the federal government. From that time appeals for federal interposition became chronic, and until its final downfall the Kellogg government never claimed to be able to control the state without the support of federal troops. In September, 1874, it was suddenly and entirely overthrown by an armed force of its opponents, and the rival McEnery government took its place, but on the 15th of that month, by orders from Washington, the latter was expelled by federal troops and the Kellogg government was restored. Jan. 4, 1875, after the democrats had got control of the legislature, apparently by sharp practice, Gen. de Trobriand entered the hall with a force of federal troops, removed certain members whom the democratic majority had seated, and restored control of the body to the Kellogg party. Both houses of congress, by party votes, approved the president's action in the case. Finally, March 3, 1877, the retiring president notified the Kellogg governor, Packard, that "public opinion would no longer support him in the maintenance of the state government in Louisiana by the use of the military," and, as the incoming administration concurred in this belief, the Kellogg Packard government disappeared from Louisiana politics. —In February, 1871, the legislature of South Carolina called for and received federal troops to suppress insurrection in two counties of that state, and in October and November, under the enforcement act of April 20, 1871, the president by proclamation suspended the privilege of the writ of habeas corpus in nine counties until disturbances should cease. In October, 1876, Gov. Chamberlain renewed the application for federal troops, which thereafter maintained his state government until April, 1877. The result of the election for governor in November, 1876, was disputed, and in the lower house of the legislature the parties were so evenly divided that the control of the body depended upon the result in two counties. In these counties the democratic members claimed to be elected, but the returning board refused to give them certificates on the ground of violence and fraud in the election. The governor surrounded the state house with federal troops, who prevented the admission of the democratic members whose election was disputed. Thereupon the whole body of democratic members refused to enter, and two state governments appeared. One, the republican, had an undisputed senate and a disputed governor and house of representatives, and was supported entirely by federal troops, the other, the democratic, had a minority in the senate and a disputed governor and house of representatives, and was supported by the judiciary and tax paying classes of the state. The withdrawal of the federal troops, as in the case of Louisiana above, resulted in a similar downfall of the Chamberlain (republican) government, April 11, 1877. —In all the states, except in the southern states during the abnormal period above referred to, there has always been a great and jealous unwillingness to call for federal assistance except in a case of extreme necessity. Even in the disorder following the great Chicago fire of October, 1871, the governor of the state took strong exception to the hasty action of the mayor of the city in calling in the aid of federal troops to maintain order instead of applying for state militia. This systematic policy has had the good result of maintaining the efficiency and importance of the militia as the usual state police, and of giving extraordinary effect to the occasional appearances of federal troops in aid of the state. The disorders attendant upon the great railroad strikes of 1877 were suppressed mainly by unaided state power; but when, as in Pennsylvania, July 18, federal troops were brought into play, the strongest and most triumphant mobs refused to attack them, and quietly retired before their advance. In a single instance, at Baltimore, some stones were thrown, in other cases the mere appearance of federal troops was sufficient to restore at least temporary order. Since that time the "domestic violence" clause has been as inoperative as before 1860—1. See authorities under articles referred to: Martin vs. Mott, 12 Wheat, 19; Metropolitan Bank vs Van Dyck, 27 N. Y., 400; Prize Cases, 2 Black., 635; The Tropic Wind, 24 Law Rep., 144, the acts of May 2, 1792, and Feb. 28, 1793, are in 1 Stat. at Large, 264, 424; the act of March 3, 1807, in 2 Stat. at Large, 443; those of July 13, July 29, and Aug. 6, 1861, in 12 Stat. at Large, 255, 281, 326. II. See Story's Commentaries, § 1807, Duer's Constitutional Jurisprudence, 340; Tiffany's Constitutional Law, § 568; Cooley's Constitutional Limitations, 169; authorities under RECONSTRUCTION, and states referred to. ALEXANDER JOHNSTON. INTERESTINTEREST is the product, the increase (incrementum), the return (reditus) from capital. When interest represents the sum paid at fixed periods by the borrower to the loaner of capital, it retains its generic name, or takes the more special designation of rent or income. The price charged by the proprietor for the use of land leased by him, is rent. The term income is more particularly applied to the product of capital employed in commerce, agriculture or manufactures. In brief, interest signifies equally the profit the capitalist derives from the direct employment of his capital, and the return he receives for granting its use to others for a certain length of time. —No difficulty can arise with respect to the profits of a capitalist who employs his own capital: the interest on capital is in this case blended with the product of his labor. If a field be cultivated, or a workshop used by its owner, he has to render no account to any one. The operation is in a certain sense a domestic one, giving rise to nothing requiring regulation. Whether the capital employed by its possessor returns 5 per cent. or 20 per cent., whether it is productive or unproductive, concerns only the producer—pertains only to the proprietor. Nothing in relation to it comes within the province of legislation, which only extends to matters which affect relations among men. But the moment the owner of capital so far relinquishes its use as to lease it, if it be immovable property, or to loan it at interest, if it be movable property, a contract is formed between the one who delivers and the one who receives. From this contract arise rights and obligations for each of the contracting parties, which it is for the law to determine for the advantage of both parties; and consequences also arise from it which it is the mission of political economy to observe, in order to deduce from them, as much for the benefit of individuals as of society, the lessons of experience. —I. LOANS AT INTEREST. Is it permissible to loan at interest? Can one legitimately derive a product from his capital, a revenue from his money? On this question, which no longer seems to be one, the world, until toward the latter part of the last century, was divided. Loans at interest had in their favor the constant practice of peoples, especially of those noted for their progress in wealth, commerce and industry; on the other side were the oracles of religion and the doctors of the law. Now that theology has become more humane on this point, and jurisprudence has relaxed its rigor, socialism has taken up the thesis of the abolition of interest. The sophism has only changed defenders. Instead of justifying this interference with capital on the ground of charity or in consequence of unenlightened views in regard to morality, appeal is now made to envy and the anarchical passions. —The (so-called) laws of Moses recognized the legitimacy of loaning at interest, for it was only prohibited the Jews in their relations with their own countrymen, who were considered as members of the same family; and credit transactions with foreigners, as well as commercial ones, were wholly free. The laws of Solon, made for an essentially commercial people, placed no restriction or limit on the employment of money. At Rome, the severity of the legislation on this subject only provoked disobedience. Capital, which was persecuted, became exacting in proportion to the risks to which it was exposed. Nowhere was theory more strangely in contradiction with practice. Cato, who compared usury (i.e., interest) to assassination, was himself an avaricious and pitiless usurer; and the stern Brutus loaned at 48 per cent. per annum. —In the middle ages the civil and religious authorities were in accord in prohibiting loans at interest. This interdiction, already written in the capitularies of Aix la Chapelle, in 789, was perpetuated in French law until the revolution of 1789. But, during this long millenium, the observance of the legal precept was purely nominal. To evade it, recourse was had to subtleties without number. First the bill of exchange, and afterward the establishment of annuities, furnished the most simple and usual means. Later, people came to tolerate loans by note, discount, and every species of money negotiation between tradesmen. Sovereigns themselves needed to borrow, and were obliged to submit to the conditions of money-lenders. Everywhere the force of circumstances overcame the obstacle of antiquated and anti-social legislation. —The prejudice against loans at interest may be traced back to the time of Aristotle, and has its source in his writings. The following are the terms in which the Greek philosopher teaches the too-well-known doctrine of the sterility of money: "The acquisition of wealth being double, that is to say, at once commercial and domestic, the latter necessary and rightfully esteemed, the former not less justly despised as not being natural and not resulting from the sale of commodities, it is quite right to execrate usury, because it is a mode of acquisition born of money itself and not giving it the destination for which it was created. Money should serve only for exchange, and the interest of it increases it, as its Greek name sufficiently indicates. Here the fathers are absolutely like the children: interest is money which is the issue of money, and of all acquisitions, it is that most contrary to nature." The anathema pronounced by Aristotle against trade in money, extends, as may be seen, to every kind of commercial operation. He did not comprehend, though living in the midst of people pre-eminently commercial, the utility of the rôle commerce plays in society. He did not see that to bring nations into contact with each other, to open the ways to markets, to place products within the reach of consumers, was to give them value, was, in a certain sense, to produce them. —In a treatise aimed against loans at interest, another Greek moralist, Plutarch, exclaims: "What! you are men, you have feet, hands, and a voice, and you say you do not know how to get a living! The ants neither borrow nor lend; yet they have not hands, or arts, or reason; but they live by their labor, because they are content with things necessary. If people were willing to be content with things necessary, there would be no more usurers than there are centaurs." Plutarch here alludes to the rich who expended money in excess of their income, and who ruined themselves by loans contracted to give free indulgence to passing fancies; but, even in those times, the debauchees and prodigals were not the only ones who borrowed. There were already industries which needed capital, and traders who had recourse to interest loans, or loans for a share in the profits to bring their operations to an end or to extend them. The treasures accumulated by saving acquired by commerce, or obtained by victory, were not always dissipated in luxury and in pleasures; they sometimes served to stimulate production and to develop wealth. Money was at that time an instrument of labor. The capitalists who loaned it for that use, rendered service to borrowers and to society. They had consequently a right to receive pay for this service. Plutarch, on account of his preoccupation with the abuses of loans at interest, failed to perceive their good results. —The fathers of the church who treated this question, only copied Aristotle and Plutarch. "The lenders," said St. Basil, "enrich themselves by the poverty of others; they derive advantage from the hunger and nakedness of the poor. To take interest, is to gather where one has not sown." St. Chrysostom, insisting on this argument, exclaims, in a style loaded with metaphors: "What is there more unreasonable than to sow without land, without rain, without a plowshare? All those who devote themselves to that damnable agriculture, harvest only tares. * * * Let us, then, cut off these monstrous children begotten of gold and silver, let us stifle this execrable fecundity * * *." St. Ambrose, St. Augustine and St. Jerome held the same language. The following is a dilemma of the latter, which, if it is inspired by charity, is hardly so by logic: "Have you loaned to him who had, or to him who had not? If he had, why loan to him? If he had not, why do you ask of him more, as if he had?" —It is easy to reply that if one loans to those who have, it is because they do not always hold all their resources at their full disposal, and a timely loan of money permits them to await the receipt of their revenues. As to those who possess nothing, by loaning them capital one gives them the means of making their labor productive; one places in their hand the lever of wealth. If they had no credit, they would be still poorer; and they should at least, in consideration of the unexpected good, pay for the use of the money they have borrowed. —Another doctor in the church, Gerson, the author of "Imitation of Christ," says: "It is better that there be some light usuries which procure help for the indigent, than to see them reduced by poverty to theft, waste of property, and selling their furniture and immovable property at a very low price." —The church also condemned sales on time, as a stipulation was made in them in regard to interest on deferred payments. This was, according to the schoolmen, "to sell time, which can not be sold, since God has made it common to all." Strange to say, this maxim of the canon law was first proclaimed by the council of Coventry, in England, the very country where the popular adage, "Time is money," was afterward invented. —But no one carried the prejudice against loans at interest (which, since the ninth century, had been stigmatized by the name of usury) farther than Luther, the originator of the religious reformation. His view of the subject is thus given in his "Table Talk": "The civil laws themselves prohibit usury. To exchange anything with any one and gain by the exchange is not a deed of charity; it is robbery. Every usurer is a robber worthy of the gibbet. I call those usurers who loan at five or six per cent. To-day, at Leipzig, he who loans a hundred florins, asks forty for them at the end of the year as interest on his money. Do you think God will tolerate such a thing? There is nothing under the sun I hate so much as that city of Leipzig; there is so much usury, avarice, insolence, trickery and rapacity there." —More passion than knowledge entered into the judgment given by Luther. The Roman church had at that time relaxed its severity in regard to loans at interest. Its allies, the Florentines, had become rich by trading in money throughout Europe. In inveighing against bankers, Luther thought he was also inveighing against popes. Calvin showed better judgment, in not allowing himself to be turned from the examination of doctrines by considerations of party or of persons. He vigorously attacked the economic theory of Aristotle on the sterility of money. "Money, it is said, does not beget money. And does the sea produce it? Is it the fruit of a house, for the use of which, nevertheless, I receive a rent? Is money begotten, to speak properly, from the roof and walls? No, but the earth produces it; the sea bears ships which serve in a productive commerce, and with a sum of money a comfortable dwelling may be procured. If, then, more profit can be derived from money negotiations than from the cultivation of a field, why should not the possessor of a sum of money be permitted to derive from it any sum whatever, since the proprietor of a sterile field is permitted to lease it for a farm rent? And when land is acquired by the payment of money, does not this capital produce an annual revenue? What, pray, is the source of the profits of the merchant? His industry, you will say, and his diligence. Who doubts that money unemployed is useless wealth? He who demands capital, apparently wishes to use it as an instrument of production. It is not then from the money itself that the profit comes, but from the use that is made of it." (Calvin's letters.) —Doctrines have as much influence as laws on the development of public prosperity. Protestant nations certainly owe to Calvin their superiority to Catholic nations, since the sixteenth century, in commerce and manufactures. Freedom to loan for interest gave rise in them to credit; and credit has doubled their power. —Not until two centuries later did Montesquieu dare, for the first time in France, to profess the same principles. "Money," says the author of the "Spirit of Laws," "is the sign of values. It is clear that he who needs this sign should hire it, as he does other things he needs. * * * It is indeed a very kind act to loan money to a person without interest; but we perceive that this can only be a religious precept and not a civil law. In order that commerce be successful, money must have a value. If money has no value, no one will loan it, and the merchant can no longer undertake anything. I err in saying that no one will loan it. The business of society must always go on: usury becomes established, but with the disadvantages always experienced from it. The law of Mohammed confounds usury with interest. Usury increases, in Mohammedan countries, in proportion to the severity of the prohibition. The lender indemnifies himself for the peril of the contravention." —Montesquieu here, under cover of his criticism of the laws of Mohammed, brings a charge against Christian society. Loaning at interest was still under condemnation in France, both by the canons of the church and the laws of the state, at the time when the "Spirit of Laws" appeared. A magistrate could less openly brave that double authority than any other citizen. Hence the artifice of the author. He applies his criticism to the past, or transfers it to the Orient. It is for French society to recognize itself in the picture, if it desires. The following reign relieved writers from that somewhat hypocritical reserve; and political economy, in the writings of Turgot, set forth principles with entire freedom. —The constituent assembly sanctioned these principles. The law of Oct. 12, 1789, by proclaiming the legitimacy of loans at interest, put an end to a controversy which had been prolonged for twenty centuries: "All private citizens, bodies, communities and mortmain people" (i.e., those holding property which they could not alienate) "shall be able henceforth to loan for a fixed time, for interest stipulated according to the rates determined by law." The new law was written, in terms no less explicit, in article 1905 of the civil code, thus: "It is permitted to stipulate interest for a simple loan, whether of money or provisions or other movable property." —Since that time loans at interest have been in accordance with civil law in France. Is this likewise natural law? Can reason, based upon the principles of morality and public utility, approve what the law declares? The Catholic church itself no longer contests it. If any are still doubtful on this point, we would refer them to the fine dissertations of the Cardinal of Luzerne and Cardinal Gousset. And as to the jurists who still rely on the arguments of Pothier, they have only to read the learned and often eloquent refutation of them given by M. Troplong, in his "Treatise on Loans." But the thesis which jurisprudence and theology have abandoned, has become a revolutionary commonplace. Loans at interest could find no favor with the socialistic school, which has declared war on capital, and on whose banner is inscribed: "Property is robbery." The theological school, in its arguments against interest loans, showed itself inconsistent. While it forbade the capitalist to collect a monthly or an annual due for the money borrowed of him, it permitted the landowner to lease his land in consideration of a farm rent, and to grant the use of his house to a tenant for a stipulated sum. The prohibition consequently applied to the form of the investment and not to the investment itself. The capitalist was prohibited, not from investing his capital, but from investing it in a certain manner. For lack of having analyzed the nature and having followed in its course the circulation of wealth, and, in consequence, of taking the sign for the thing signified, and the precious metals for value, a sort of embargo was put on money. In virtue of a preconceived theory which represented money as a sterile metal, they really impressed it with sterility. —It is clear, however, that if the possessor of a sum of money has not the right to make it productive and to derive a revenue from it, the possessor of land could not, with any better right, lease it to a farmer to cultivate, in consideration of an income or rent from it. The earth, in fact, does not spontaneously engender a revenue any more than does money. Under both forms, capital is only the instrument of labor. He who receives it, must pay the price to him who leases it. The borrower owes the price in both cases, or he owes it in neither. There is no way of getting out of this dilemma. —"Coined money," says M. Troplong very justly, "the creation of man and not of nature, is in turn utilized as a commodity, or as a sign of values, without there being any reason to cry out against this two-fold employment of it. It must submit to the condition of matter, which is to be a slave of man, and must serve all the uses and necessities that it can reasonably satisfy. So far, then, from disparaging the means of acquisition invented by the genius of man, in imitation of the natural and primitive means of acquisition, we should, on the contrary, recognize that this is the masterpiece of civilization, which opens to social activity new careers, new sources of labor, new and admirable means of promoting comfort among the classes who have inherited no wealth. Plutarch thought he was overwhelming the loaners by an irresistible argument, when he told them that they made something out of nothing. But, without knowing it, he gave the finest eulogy on credit which derives wealth from sterility. Money is no more impressed with infecundity than everything around us; for there is nothing productive for man save what is fertilized by labor or utilized by necessities which pay for their satisfaction. What would the earth produce, save tares and thistles, without the plowshare? What revenue would a house give its owner, if the necessity of a dwelling did not oblige a neighbor to lease it? * * Money becomes productive by the need the borrower has of it, the same as a building becomes productive by the need the tenant experiences of occupying it. Money is sterile only when it remains unemployed. Hence we see the confusion into which the canonists fall, when, granting that money may be made productive by industry, they insist on saying that in interest loans, it is the industry of the borrower, which, keeping the money active, renders it productive, and that, since the lender has no part in that industry, he should have no part in the benefits it procures. But what matters it to the lender what use the borrower makes of the loan? * * It is about as if the lessor of property should have scruples about the legitimacy of his contract because the tenant who rented his house did not occupy it. * * The price the lender receives is not a part of the profit the borrower will make by his industry; it is the price of the transfer which the lender makes to him, for a certain time, of the ownership of a sum that he has declared will be useful to him: a price the legitimacy of which rests on the deprivation the lender imposes upon himself, and on the advantage alleged by the borrower, usura propter usum." —What M. Troplong here affirms, with general assent, is exactly what socialism denies. "He who lends," says Proudhon, "in the ordinary conditions of the trade of the lender, does not deprive himself of the capital which he lends; he lends it, because he has nothing to do with it for himself, being sufficiently provided with capital; he loans it, in short, because it is neither his desire, nor within his power, to give it value himself; because in keeping it in his hands, this capital, sterile by nature, would remain sterile; while, by the loan and the interest resulting from it, he produces a profit which enables the capitalist to live without labor." (From third letter to M. Bastiat.) —That eminent economist, M. Bastiat, whose early loss to economic science we deplore, has remarked that this argument attacks sales as well as loans. If it can be alleged that the possessor of a sum of money does not deprive himself of it, by loaning it, why could we not say the same of the one who sells commodities which he possesses in too great abundance? The system of Proudhon would render every commercial transaction impossible, because there is not a single one which is not based on interest on the capital invested. —But we do not need to appeal to analogies nor to enter upon comparisons, to refute a theory based on a position outside of facts accepted by everybody, and in opposition to these facts. Let us go directly to the root of the sophism. Socialism claims that the loan should not bear interest while the one who loans does not deprive himself, and that the lender suffers no privation while the capital loaned would remain sterile in his hands. This is an absolutely gratuitous allegation. First, if the capital borrowed must not produce interest, I can not see why the capitalist should part with it in favor of the borrower. People keep money only to derive an income from it; and if money must remain unproductive, people will cease to loan it. This will be the end of credit. —But nothing appears to have a weaker foundation than this thesis of the necessary unproductiveness of capital in the hands of the capitalist. In one form or another, a capitalist always employs his money. He loans it at interest only when other forms of investment offer either a less return or one more uncertain; but in lack of a profitable loan, what prevents him from employing his money in agriculture, manufactures or commerce? It is surely lawful for him to buy land or a manufactory; and if he does not wish to put his own hand to the work, he can always take an agriculturist or a manufacturer as a partner, invest his funds in a joint stock association, or obtain shares in some marine enterprise or in railroads. In interdicting loans at interest, the socialists have forgotten to interdict association or to close the ways to human activity. —The socialists, however, more consistent in this than the canonists, prohibit rent of land as well as interest on money. For them, the productiveness of capital, as Proudhon does not hesitate to say, is a pure fiction. What is there, if one reasons in this way, real in the world? Will the socialists always have eyes only not to see? The earth, from one end to the other of the countries which civilization has touched with its wand, recounts the marvels of capital. Capital is everywhere present. It is the universal motor, the soul of industry; it is the trace of the sojourn or the passage of man on the earth, that which distinguishes culture from barbarism. The power of a people is measured by the extent of its accumulation of labor. A farm in Beance, in France, of the same extent of land as could be bought in Canada or New Zealand for $800, would cost $80,000; and in an uninhabited country it can be had for nothing. Whence the difference in value? From the fact that the land which the colonists buy in New Zealand, for instance, is land yet to be tilled, land without capital; while he who acquires a domain in Beauce pays for the capital incorporated in it. The productiveness of soil enriched by fertilizers, improved by cultivation, provided with cattle and instruments of tillage, furnished with farm buildings and dwellings, and near to great markets—all these make the difference. —And should the owner of this wealth, which often represents the accumulated labor of many centuries, rent it for nothing, like land covered with bushes and brambles, such as met the eyes of the first occupant? Not only would this be contrary to equity, but it would be physically impossible. A state of society in which proprietors who did not cultivate the soil with their own hands should be condemned to give it over, without compensation, to farmers who would derive the benefits of the labor previously expended on it, in addition to the profits from their own labor, would not be long in coming to an end. The abolition of rent would speedily entail the abolition of property. —The socialistic theory of exchange belongs to a purely imaginary world. At no period of history has it even begun to be applied. Suppose men reduced to their own powers in a newly forming society. As certain individuals prove to be more richly endowed by nature or make a better use of their faculties, there will necessarily be workmen who will produce more than others, whose products will not find their equivalents in exchange, and will form an excess, a reserve, a capital; hence inequality of conditions and of fortunes. This inequality, when it exists, is transmitted or may be transmitted. Property implies inheritance. When we recognize in man the right to dispose of the results of his labor, we are inevitably led to admit that he may dispose, by the same right, of the results of labor which have been accumulated by him or his ancestors—in a word, of capital. To arrest this natural direction of human activity, the Banque du Peuple is a poor invention. [An allusion to a "People's Bank" instituted by Proudhon for the suppression of capital. E. J. L.] It would not, in fact, be sufficient to abolish rent of money and rent of land; it would be necessary, by a more radical and more logical process, to go so far as to abolish property. Communism is the last term of that theory, in which a subtle mind has imperfectly succeeded in disguising the absurdity and violence of the ideas by the novelty and charm of the form. —II. RATE OF INTEREST. The legitimateness of loans at interest is to-day recognized in the principal states of Europe. But while abandoning the ground of absolute prohibition, governments have not had the courage openly to avow the doctrines of liberty. Just as it is sought to protect agriculture and manufactures against foreign competition, it is claimed that the cause of the borrower may be defended against the lender, and of the poor against the rich, by fixing the rate of interest or limiting it by the establishment of a maximum. Whoever, in loaning, exceeds this legal rate, exposes himself to a penalty. Usury no longer signifies the interest on money. This word, modified from its primitive sense, takes an opprobrious meaning, and becomes a mark of infamy. To invest one's money at a rate the law discountenances, is called practicing usury, and is to commit a crime. —The laws which interdicted loans at interest have had their day; the laws which regulate the rate of interest will pass away in like manner. By examining the effects of this legislation, it is easy to show that it defeats its purpose. What is proposed to be accomplished by excepting money from the common rule of values, the level of which is determined by competition in the market? It is desired to prevent the price of that commodity from rising beyond measure, or, in other words, to oppose a barrier to the rise in interest. Now, observation teaches us that the more restrictions the laws have placed upon trade in money, in the past, the higher has become the rent of capital. The penalties against usury give rise to it or develop it; they are an added risk to those naturally connected with investments of capital. In compensation for this additional peril, the lender can not fail to demand a premium. The laws which augment the risk also discourage competition. The number of lenders and the amount of the disposable capital then diminishes, the number and eagerness of the borrowers remaining the same; and people are then astonished at the high price of the commodity, when they have done all they could to produce this condition of the market! —In ancient times, the peoples who allowed the greatest liberty in the investment of capital were also those who saw commerce and the industries flourish in their midst, and among whom borrowers obtained the most moderate terms from lenders. The nations, on the contrary, who gave no latitude to credit transactions, or security for credits, were obliged to submit to pay more dearly than others for money. The history of Athens and that of Rome present conspicuous and instructive types of this contrast. At Rome a debtor who did not meet his engagements when due became the slave of the creditor. At Athens the right of the creditor to the person of the debtor was abolished by the laws of Solon. Solon did not attempt to regulate the interest on money, and no trace of usury laws is found in the annals of that commercial republic. The rate of interest at Athens varied according to the circumstances and with the security offered by borrowers. The lowest rate appears to have been 10 per cent.: this was in fact a very moderate charge for movable capital, at a time when the income from land was 12 per cent. to those who did not work their lands themselves, and when maritime commerce, which attracted money as well as men, borrowed at from 20 per cent. to 36 per cent., and when the industries, employing slaves as workmen, returned fabulous profits. The interest on money was in proportion to the profits on labor; and here we see why the question of debts, that permanent cause of troubles in the Roman empire, never excited either commotions or political agitations in Greece. —In the early days of the Roman republic the rate of interest was not regulated by law. M. Troplong considers this latitude in regard to transactions as the cause of the oppression the people suffered from the patricians. But did the law of the Twelve Tables, which fixed the interest at 10 per cent. per annum, diminish the ravages of usury at Rome, and bring about a fall in interest? M. Troplong himself cites from Titus Livy and Plutarch numerous instances which superabundantly prove the contrary. Montesquieu was not in error on this point. "As the Roman people," he says, "were daily becoming more powerful, the magistrates sought to flatter them by having such laws enacted as were most pleasing to them: capital was restricted; interest diminished and finally prohibited; bodily constraint was taken away; and at last the abolition of debts was proposed, whenever a tribune wished to render himself popular. These continual changes, either by laws or by piebiscits, naturalized usury at Rome; for the creditors, seeing the people their debtors, their legislators and their judges, had no longer any confidence in contracts. The people, like discredited debtors, could borrow only at high rates; and this was the more so, because, though the laws only occasionally interfered, the complaints of the people were continuous, and always intimidated the creditors. Thus were all honorable means of loaning and borrowing abolished at Rome, and a frightful usury became established." —The results in modern times have been the same. The only nations or states in which the trade in money has been most regular and confined to reasonable limits, are the very ones where the greatest freedom in money transactions has been tolerated or authorized. It is sufficient to mention Genoa, Venice, Florence, Holland and England. Holland, in the seventeenth century, although its credit was weakened by war, borrowed at 4 per cent.; in England, the current interest was 3 per cent. toward the middle of the eighteenth century. Owing to their ability to give value to their capital, the Florentines and Milanese, in the sixteenth century, under the name of Lombards, took the place of the Jews, in a large way, and became the bankers of Europe. Freedom in the matter of interest favored the establishment of credit institutions. The foundation of the bank of England and that of Amsterdam were nearly a century earlier than that of the bank of France. —Moreover, the fall in interest and the development of commerce, in the states where there was the greatest toleration for credit transactions, appear to have followed step by step the progress of this liberty. Thus, in England, Henry VIII. had fixed the rate of interest at 10 per cent. Edward VI. absolutely interdicted loaning at interest. Elizabeth gave an impulse to trade by abrogating the statute of Edward and re-established 10 per cent. as a maximum rate, thus indirectly giving much latitude to traffic in money. —The statute of Queen Anne fixed the rate of interest at 5 per cent. per annum, and pronounced every contract void in which the interest should exceed this rate. In accordance with the usual practice of the English, who rarely act from general principles, this statute was long nominally in force after being allowed to become practically obsolete. Then it was abrogated by successive degrees, a part at a time. The act of the fifty-ninth year of George III. (1812) was the first attack made on the principle. It was enacted that a bill of exchange or a bill payable to order, which might be declared void because of usury, should be valid in the hands of one who had taken it in good faith. Then came the act of the fourth year of William IV. (1833), which, in renewing the privilege of the bank of England, abrogated the usury laws in the kingdom, so far as bills of exchange and notes payable to order on three months or less were concerned. The act of the first year of Victoria's reign extended the exemption to bills of exchange and notes payable to order, the term of which did not extend beyond a year; and the act of the third year of the same reign comprehended also all loan contracts made for sums which exceeded £10, provided the loan was not secured by a mortgage on real estate. —In consequence of the latter provision, landed property had now to pay higher than the current market rates for money, and was, therefore, at a disadvantage in comparison with manufactures and commerce. Such an inequality before the law could not permanently continue. In 1854 a law was enacted (17 and 18 Vict., ch. 90) repealing all existing statutes against usury, though not touching the statutes in reference to pawnbrokers. These were modified later (35 and 36 Vict., ch. 93). —The above-mentioned changes in the laws made to regulate the rate of interest appear to have been a result of the celebrated resolutions which were reported to the house of commons in 1818, in the following language. "1st, Resolved, that it is the opinion of this committee that the laws regulating or restraining the rate of interest have been extensively evaded, and have failed of the effect of imposing a maximum on such rate; and of late years, from the constant excess of the market rate of interest above the rate limited by law, they have added to the expense incurred by borrowers on real security, and that such borrowers have been compelled to resort to the mode of granting annuities on lives, a mode which has been made a cover for obtaining higher interest than the rate limited by law, and has further subjected the borrowers to enormous charges or forced them to make very disadvantageous sales of their estates. 2d, Resolved, that it is the opinion of this committee that the construction of such laws, as applicable to the transactions of commerce as at present carried on, have been attended with much uncertainty as to the legality of many transactions of frequent occurrence, and consequently been productive of much embarrassment and litigation. 3d, Resolved. that it is the opinion of this committee that the present period, when the market rate of interest is below the legal rate, affords an opportunity peculiarly proper for the repeal of said laws." —As to the effect of the repeal of these laws, unexceptionable official documents permit us to judge. In the year 1841 the bank of England took the initiative in that regard, and, in a country where it is customary to follow public opinion rather than to lead it, did not hesitate to give an impetus to public thought. On May 13, its court of directors met and embodied the results of eight years' experience in the following declaration: "Resolved, That the modification of the usury laws at present existing has contributed greatly to facilitate the operations of the bank, and is essential for the proper management of its circulation." Parliament, on its side, determined to obtain evidence of the good or bad results of the partial repeal of the usury laws. The house of lords, in the year 1841, investigated the subject, and the testimony brought before it (published in 1845), casts much light on the question. —A distinguished economist. Mr. Norman, after having called attention to the fact that the bank of England, thanks to freedom of interest, had successively fixed the rate of discount, following the variations of the market, from 4 to 4½ per cent. on July 21, 1836; at 5 per cent. on Sept. 1 of the same year; at 5½ per cent. on June 20, 1839; and at 6 per cent. on Aug. 1 of the same year; terminated his deposition in these terms: "I have always regarded with surprise and admiration the way in which the mercantile pressure of 1839 was borne. It was very severe, and the number of failures of consequence was certainly small; and I can not help attributing in some degree the manner in which that pressure was sustained, comparing it with what had occurred on similar occasions previously, such as in 1826, to the state of the law which enabled capital and loanable accommodation to flow into those channels where it was most wanted and could be best paid for—in fact, into its natural channels." —One of the most eminent practical bankers, Saml. J. Loyd (afterward Lord Overstone), confirmed this opinion by the following explanation: "Had the law which fixed the maximum rate of discount at 5 per cent. been maintained in operation, it would have produced inconveniences of two kinds: in some cases, parties requiring the command of money would have been unable to obtain it, and would consequently have been subjected to many very serious evils, such as forced sales of their goods at ruinous prices, injury to their general credit, and, in many cases, actual suspension of their payments; in other cases, parties would probably have obtained the money by resorting to circuitous contrivances for the purpose of evading the law, which would necessarily have entailed upon them great additional trouble, discredit and expense." Mr. Loyd hence concluded that the act of 1833 had saved British commerce, in the pressure of 1839. —This was also the conclusion to which Mr. Samuel Gurney, one of the most able bankers and most revered men in London, finally arrived, who called attention to the fact that in 1818, when the state loans were the only ones exempt from the operation of the usury laws, and when considerable loans had been issued by the government, capital deserted the commercial market, which was subject to the legal limit, for the market of public funds; and commerce had to suffer much in consequence of the restrictions which fettered business. Mr. Gurney entered into detailed calculations which brought into relief the consequences of the two systems of restriction and freedom in the matter of interest. "The advantages of the relaxation in the law to the trading community," he said, "are that under every circumstance they are able to procure supplies of money and to carry on their business with facility. In the two or three last pressures which we have had, we have had very few failures. I will now take the other side. What is the disadvantage? It is that they have to pay this high interest for a limited time; the calculation of that disadvantage brings it to a very small sum. A firm of large extent may have under discount to the extent of £50,000, and have to pay 6 per cent. interest for that £30,000 instead of 5 per cent. for six months; this is the extent of loss, which comes to only £250. For that loss he gets the advantage of general facility, a less risk, as credit is much better preserved—advantages greatly beyond the loss. One other great advantage is the ability to borrow money upon the security of his goods, or sell them. If he borrow money upon his goods, it resolves itself into a calculation of a similar character; if he thus borrow £100,000, there will be a loss of £300 or £400; but if he is compelled to sell his goods, he can not, under such circumstances, at a less loss than from 10 per cent. to 20 per cent.; and therefore, on the one hand, he may have to lose some £300 or £400; but, on the other, if compelled to sell his merchandise, which he must do were he unable to pay more than the legal rate of interest upon a loan, the loss would be, under forced sales, of from £10,000 to £20,000." We might extend these quotations. The witnesses summoned, in the course of the inquiry, were, with scarcely an exception, unanimous. —Some persons have observed that, if merchants in high position gained by the repeal of the usury laws, the same was not true of those whose credit was less firmly established, and that usurious rates were demanded of this class. But what does that prove? That there was, apparently, a certain risk in lending. If the usury laws had been operative, the embarrassed merchants would not have found money, or they would have had to pay still more to procure it. In either case, failure was imminent. Thus much for the example of England: let us now pass to France. —Interest on money was certainly much higher at the time when legislation interdicted interest loans and burned Jews, than under the far more mild régime which authorized loans under the form of annuities, and fixed by law the rate at which loans could he made by alienating capital in this manner; it had become still lower, and commerce had become extensive at the time when Turgot wrote these remarkable lines: "It is a well-known fact that there is not a commercial place on the earth where the greater part of the commerce does not depend on money borrowed without alienation of capital, and where interest is not regulated by a simple agreement, according to the greater or less amount of loanable money in the place, and the degree of solvency of the borrower. The rigor of the laws has yielded to the force of things; jurisprudence has been obliged to modify in practice its speculative principles, and people have long since come to openly tolerate loaning by note, discount, and every species of money negotiation between parties. It will always be thus whenever the law prohibits what the nature of things renders necessary." —The constituent assembly only half adopted the ideas of Turgot. The law of 1789 permitted loans at interest under any form, but it reserved to the legislator the right to fix, or at least to limit, the rate of interest. The civil code, promulgated in 1804, stipulated a similar reservation; these were mere preliminary and tentative changes, which prepared the way for the law of Sept. 3, 1807. —We say nothing of the intermediary régime. Some claim that the convention declared money merchandise, and that in consequence of that unlimited freedom, usury for some years invaded and ravaged the country. The laws of the convention were contradictory. At one time, to raise the price of the assignats, it interdicted trade in the precious metals: again, it removed the prohibition and left every one free to buy and sell gold and silver at their actual value. Interest, the rent of capital, only resumed its liberty as a consequence.28 This liberty was the result of the toleration of the government, and not of a clear perception of a principle which it firmly proclaimed. But what matter is it whether the convention, in removing the barriers it had itself raised, removed also others or not, and rendered homage to political economy without willing it or knowing it? The events which occurred in the commercial world, during that period of anarchy and the disturbed times which succeeded it, prove nothing either for or against any system. —We are, however, inclined to believe that, notwithstanding the calamities which were the inevitable result of the civil disorders and of war, and although commerce, manufactures and credit were nearly paralyzed in France from 1793 to 1797, the toleration accorded meanwhile to pecuniary transactions bore more good fruit than bad. People have quoted the protests of some chambers of commerce, which complained at that time of the dullness of trade, the great numbers of failures and the cupidity of loaners. In reply we will say, without having regard to these particular cases, that the speech of Joubert, who proposed the law of 1807, itself shows that interest on money had generally fallen. But, were it otherwise, can any one really suppose that laws more restrictive would have procured money for trade at a low price, at a time when the risks connected with every negotiation or credit transaction were so great, and when confidence was so weak? —The legislators of 1804, more favorable to liberty than those of 1807, had left the way open. Article 1707 of the civil code provided that the interest agreed upon might exceed the rate fixed by law, whenever the law contained no prohibition to the contrary. This was directly to recognize that the value of money, like all other values, results from the state of the market and the terms arranged between parties. The legislators of 1807 shut this half-open door, by putting agreed-on rates of interest in the same line as legal interest. It may be well to quote here the language of a law which can serve as a starting point in the discussion. "Art. 1. The interest agreed upon shall not exceed 5 per cent. in civil matters [i.e., those coming under the cognizance of what are known as civil courts, in France, in distinction from mercantile courts. E. J. L.], nor 6 per cent. in mercantile matters, without retention. Art. 2. The legal interest shall be, in civil matters, 5 per cent., and in mercantile matters 6 per cent., also without retention. Art. 3. When it shall be proven that a loan has been made at a rate exceeding that fixed by Art. 1, the lender shall be condemned by the court before which the case is brought, to restore this excess, if he has received it, or to suffer a reduction of the principal of the debt, and he may even be remanded, if cause appear, to the court of correction, and, in case of conviction, condemned to a fine not exceeding half the capital he has lent on usury. If the result of the law process shows that the lender has practiced fraud, he shall be condemned, besides the above fine, to imprisonment for a term not exceeding two years." —The economy of the law of 1807 consists entirely in a small number of rules. It lays down as a principle that freedom of agreement in regard to rate of interest must be exercised only within the limit of the legal maximum. Provisionally, this maximum is fixed at 5 per cent. in civil matters, and at 6 per cent. in mercantile ones. —The law of 1807 makes usury a crime. But what is usury? Bentham said truly that it was not susceptible of definition. And in fact, if usury consists in loaning at a rate higher than that fixed by the legislature, one may be a usurer in England while loaning at a rate which would be permissible in France, and vice versa. In France the offense depends, not on the nature of the act, but on the quality of the lender. One is a usurer if he loans at 6 per cent. in civil matters, but ceases to be so if he loans at the same rate to one engaged in commerce. These inconsistencies in legislation prove that an attempt has been made to regulate that which, from its nature, evades legal rules. The authors of the law of 1807 perceived this; for, after having made the act of loaning at an interest in excess of the legal rate a crime, they did not affix any penalty. The court, in this case, can only sentence the lender to restore the excess. The sentence can only extend to a fine in the case of habitual usury, that is to say, when the offense becomes changed; when, instead of having to deal with parties whose bargains depend upon the variations of the market, the court finds before it a speculator who makes a business of seeking the most risky investments, those which serve as an excuse or pretext for unlimited profits. —The law of 1807 has only one kind of merit. In a country where there is too little general information on matters of political economy, and where anticommercial prejudices have still much influence, it bears a certain relation to the average level of intelligence and the state of morals. In 1836 a motion was made by M. Lherbette aimed at the repeal of this law and the restoration of freedom in the matter of interest; but it failed because of the unenlightened opposition of the elective chamber. In 1850 the proposition of M. Saint-Priest to modify the law had no better success: the law which was enacted Dec. 15, instead of punishing the simple contravention of the law prescribing the legal interest, is only aimed against the habit of disregarding it, and confines itself to increasing the penalties. —The law of 1807 governs the trade in money in all the countries of Europe which have adopted or imitated the French civil laws. To examine into the effects it has produced in France, is then to obtain the elements which may serve to give the most general view of the question. The law of 1807 did not, as we know, bring about a fall in the rate of interest, which is, notwithstanding the solidity of the operations, much higher in France, in every scale of credit, than in England, Holland and Belgium. The absolute prohibition it contains has not prevented the loaner, wherever there were risks to be incurred, from stipulating for excessively high interest which was legally usurious. That has been accomplished in a contraband way instead of openly. But the troubles from it have been only the greater; for the interest must include, besides the premium for the risk arising from the small degree of solvency in the borrower, that of the risk arising from contravention of the law. —The mohatra, so much branded by Pascal, has reappeared, and the usurious loan has been disguised under the form of a sale. In other cases the fraud has been accomplished under the form of a donation; besides the legal interest, the lender has required a supplementary interest, under the title of gift. Sales with privilege of redemption have also served to conceal usury, which has, besides, taken place under cover of an exchange. But the most usual as well as the most simple form has consisted in stating in the loan contract, or on the notes given to the loaner, a sum higher than that which the borrower had received. —The defenders of the system sanctioned by the law of 1807 themselves recognize that this law, far from uprooting usury, has perhaps aggravated it. Usury, it has been said, is devastating French rural districts; and it is certain that the debts of small property-holders had much to do with the socialism of the central and eastern departments of France in 1849 and 1850. —A representative of the upper Rhine, M. Cassal, cited in the tribune curious examples of frauds practiced in Alsace to evade the provisions of the law of 1807. "The usurer," be said, "no longer proceeds in this fashion: 'I lend you one hundred francs in consideration of ten francs.' Nothing like that is written. A note of a hundred francs is made, but only ninety of it are given. Care is taken that it be done with no witnesses present, and then you have the provision of article 1322 of the civil code, which establishes a legal presumption in favor of the creditor who has a writing. In this case itself it is very difficult to prove usury. More frequently sales with power of redemption occur: property is bought for the consideration of one hundred francs, and only ninety are paid; and when the debtor wishes to obtain his property again, he is obliged to pay back the sum stipulated in the contract as price, and happy is he, too, if the purchaser will consent to restore him his property. In this case also, the stipulations of article 1325 of the French civil code are exactly fulfilled: you have no witnesses, and it is impossible to prove usury. When one of these men loans at 5 per cent. on a simple note, there is much reason for mistrust; the lender has evil designs. When the note falls due, the debtor can pay; but the creditor promises to wait. When the time comes that the latter knows the former has no money, he becomes pressing, prosecutes, hounds the debtor, forces him to make an assignment, lays down orders, and, finally, compels the unfortunate to pay what is called the interest of patience. Then he takes everything the former can give: fifty francs, a pair of sabots, a batch of bread, per week. But all this is the A B C of usury. The usurer but rarely makes his bargain in his own name. The borrower sometimes does not even know him; the business is done through an intermediary, a sort of broker, who, ordinarily, has nothing to lose, not even honor, who also takes brokerage, and thus increases still more the interest on the money. When loans are made, the first step is to ask for security. This security is the person who signs the note and carries it to the borrower, or vice versa; the intermediary likewise, signs the note, and it is sometimes covered by three, four or five signatures before reaching the real lender. The usurer is then in the position which, in the language of the law, is called 'a third carrier in good faith.' The aim of the business is to make some kind of a bargain: in primitive times, a trade in flocks or herds; later, in real estate. This is how it is effected. Sometimes one lends a sum, always by an intermediary, on a simple note or an obligation acknowledged before a notary, and on the other hand, he has a field or other real estate sold to him at an extremely low price. Care is taken, however, that the matter be so arranged that the lesion of the seven-twelfths may not be reached. These men, who thus exploit French rural districts, have divided the territory: each one has his chosen portion to exploit, and it is rare for another to permit himself to go there to do business. You comprehend then that they are perfectly well acquainted with the value of the estates, better than the peasants themselves. Consequently there may be usury of 100 per cent. or 200 per cent. without the cognizance of the law. At other times, and this is far more serious and more common, they force the borrower, giving him meantime the funds for the purpose, to buy a piece of land or some other commodity at a very high price. Here they do not take the trouble to put as large a sum as possible into the contract: they put the property at double or triple its value. Let them succeed in making a man contract a debt, and nothing can save him; he is soon dispossessed of his property. I know entire villages which do not contain two solvent private citizens." —Looking at this social condition, one would think he was living in the middle ages. Is it necessary, in order to remedy this, to make the penalties greater and to increase the legal restrictions? M. Cassal, who is not, however, an economist, but who has had a near view of the evil, does not think so. "I know the country usurer well enough," he said, "to apprehend that our law (that of 1850) instead of producing the extinction of usury, may perhaps produce the contrary effect, by closing the purse strings and shutting out all credit. Usury is the only means, the single source of credit to the countrymen; and if that source dries up, I fear they may be more miserable than before." —The defenders of restrictive laws in the matter of interest would do well to reflect upon this remarkable avowal. They think they have replied to all objections when they say: "If the borrower is not sufficiently solvent for loans to be granted him at the legal rate; if an additional premium is necessary to cover the risk—well, people will not lend to him at all." Shall credit be thus obliged to stop rather than exceed the level of interest which the legislator has supposed legitimate? But credit can no more be arrested in society than the circulation of blood in the human body. For the one as for the other, motion is life. You say that loaning at high interest will in the long run ruin the borrower. This is possible; but he will be ruined without usury, if he does not find a way to borrow what he needs to meet his obligations when they fall due! —The capitalist who speculates upon the temporary distress of the borrower is a wretch. Science has no intention of sheltering such under her mantle. If usury extends to direct or indirect fraud, there are laws to punish it. But let no one attack the freedom of mercantile transactions, under pretext of preventing usury. Provided the loaner and borrower are free to make a bargain, the contract should be valid. It matters little at what rate the investment be made: the interest of money is naturally subject to one law alone, that which determines that the price of things, instead of being fixed arbitrarily by the civil power, results from the essentially variable relation between supply and demand. There is but one way to abolish usury, and that is to extend to property the benefits of credit institutions, and accustom proprietors punctually to fulfill their obligations. For the rest, the relation of demand to supply so bears upon the contracting parties, that governments, when they wish to borrow, are themselves subject to it. Whenever it was necessary to contract public loans, the French government took good care not to appeal to the law of 1807. In difficult circumstances it has borrowed at 7 per cent. and even at 8 per cent.; and instead of then considering the capitalists who undertook the loan at these high rates as usurers subject to the penalty of the law, it sought to attract them by all means in its power. Not to speak of the profits they have made by loaning to embarrassed governments, have not bankers obtained all the marks of distinction which could flatter their vanity? Have they not been covered with cordons and admitted to the ranks of the aristocracy? —Thus the state itself sets the example of violation of the law. It seems that the legal rate of interest is obligatory on every one except itself. To loan at 6 per cent. to private individuals, is to expose one's self to the severity of the courts; to loan at 6 per cent. to the state, to cities, to departments, is to merit public gratitude. Who can henceforth take seriously this pretended crime of usury, which is not such for states, but is such in private transactions? —This is not all. In testimony of the powerlessness of the legislator when he attempts to do violence to the nature of things, the French law of 1807 was obliged, in fixing a maximum rate of interest, to admit of exceptions and establish categories. Thus, loans on property security, on pledge, on provisions, and discount, escape its rules. The same observation applies to commissions charged by banks, and to the premium given to brokers who answer for the persons to whom they sell merchandise; as well as to those commercial practices which are so many additions and supplements to the interest stipulated in the money loans. —III. LOANS WHICH EXCEED THE LEGAL RATE. The loan on pledge (or pawn), which entails at once numerous risks and considerable expenses of administration, is one of those which can be made only at a relatively high interest. All the pawnbrokers in Europe would be ruined in a few months, if they were compelled to loan at a rate corresponding to the price current of money in the market. The exception which has been made in their favor, or rather, the freedom in regard to interest which is allowed to be the rule in their case, has been favorable to those who patronize these institutions. To speak only of the mont de piété at Paris, the interest asked of borrowers has constantly diminished since the last century: it was 5 per cent. per month in the year III. (1795-6), 2½ per cent. per month in the year VIII. (1800-1), and 1¼ per cent. in 1831. As the rent of money becomes lower in the general market of capital, the pawnbroker will lend at a lower interest to necessitous families. —As to the loan of provisions, which the law of 1807 does not govern, and in which one may always, by the terms of article 1907 of the civil code, exceed the legal interest, jurists have found a reason to justify that exception, which, if they were disposed, might be made to apply equally well to loans of money. "How can we think," says M. Troplong in his "Commentary on Loans," "that the legislator could have intended to impose the same rate of interest on loans of provisions as on money? How can we suppose that he would have taken no account of the risks, which are much greater in the loan of provisions than in the loan of money; in the loan of provisions, we say, where an abundant harvest at the time of payment may take away so much of the value of the thing lent in time of dearth? Would he have condemned the system followed in all ancient nations by legislators and economists, of fixing the interest on provisions higher than the interest of money? We think, then, that there would be nothing illicit in an agreement which should obligate the borrower of a hundred measures of oil, grapes, or apples, to repay a hundred and ten or a hundred and fifteen at the following harvest." —When one borrows money, it is not the metal exactly which one wishes to possess, but the value it represents. Under the form of money or under the form of provisions, the lender delivers capital: capital is the object of the contract. From the essential point of view, which is that of value, there is no difference. In vain has it been objected that the value of grain was variable; for the same objection would apply to the value of money. Who does not know that the power of the precious metals was much greater in the time of Charlemagne than in the reign of St. Louis; in the time of St. Louis than in the reign of Louis XIV.; and in the reign of Louis XIV. than in our day? No doubt money presents a more fixed and certain measure of value from one year to another than wheat; but from one century to another the advantage of fixity and constancy passes to the wheat. The price of cereals is, in fact, the light by the aid of which we find our way in studying the economy of society in the past. —Under one form as well as another, the rent of capital depends on its abundance or rarity compared with the urgency of the demand. It is not the nature of the loan which can raise the premium; it is the situation of the borrower. Why did the legislator of 1809 allow the rate of 6 per cent. in mercantile bargains, while he imposed the minimum limit of 5 per cent. in civil matters? Apparently, that difference of interest signifies that the risks are greater in one case than in the other, and that the trader who invests his funds in uncertain operations does not give the same security for payment. Why does M. Troplong recognize in the lender of provisions the right to demand from 10 to 15 per cent. interest, if not because the certainty of payment is less in transactions of that nature? Starting there, to be consistent, one step more should be taken: the principle should be separated from the example, and one should say that the premium on the risk, which is one of the elements of interest, increases naturally in proportion as the certainty of reimbursement diminishes. In loans at interest, the premium on the risk acts as a sort of insurance on capital; this is why there are no reasons for refusing to allow it in the loan of money, when it is allowed in the loan of provisions. Credit is naturally personal. There exists no such thing as one rate of interest belonging to provisions and a different interest belonging to the precious metals. It is because those who borrow provisions generally place themselves in a more hazardous situation, that high interest is demanded of them. But a good number of borrowers to whom money is loaned personally merit still less confidence; why should it not be permitted to stipulate with them a premium for insurance, commensurate with the perilous chances they cause one to incur? The principle is admitted in wholesale contracts. Do you suppose that there is not, as M. Sainte-Beuve has so well said, any such debtor whose solvency makes the loaner run as much risk as he would incur from tempests? To sum up, either the exception made in the case of the loaner of provisions has no raison d'être, or the considerations which have determined it tend invincibly to liberty in the rate of interest, under a general law. —On the question of discount the subtleties of jurisprudence are freely exercised. Certain jurists rank it in the category of sales; others, in that of loans. "The banker who discounts," says M. Troplong, "only makes a loan. Accustomed to trade in money and notes, he only purchases a credit; and as 10,000 francs, payable in one year, are not worth 10,000 francs payable now, he gives a less price than the nominal one. This price is calculated on the time to run, on the solidity represented by the signature of the one who signs it, the value of that signature, the place. etc. Discount is only the difference between the nominal and the real value. I have said that the banker buys a credit; I add that, on his side, the borrower buys a present sum for a sum not due. In all cases, the borrower who sells his credit does not contract the obligation of returning the same thing, characteristic of the loan; his obligation is, to deliver the chose and guarantee its payment. On the other hand, the banker becomes proprietor of the effect, with the same title as if he had bought any other article; he uses it as be pleases, and has nothing more to do with the one who assigned it to him except so far as pertains to the security." —We see that if the rate of discount escapes in France the rules laid down by the law of 1807, it is not through respect to a theory which takes its point of support outside of realities. The legislator has yielded to the force of things, either by formally accepting or by tolerating usages which he could no more modify than destroy. —M. d'Esterno has cited, in the Journal des Economistes, curious examples of loans at a high rate, which are negotiated, to the mutual satisfaction of borrower and lender, the department of Saône-et-Loire. "There are," he say, "small farmers who buy, in May, cattle for labor, and sell them again in November. If they buy them for cash, they pay 600 francs for them, for instance, but, as they only pay 300 francs at the time of getting them, and promise the other 300 at the time when they count on having sold them, they consent to give 50 francs more for that accommodation. This transaction is usual, and it is repeated in the case of other animals, hogs, for example." Thus, farmers who would probably not consent to borrow at the rate of 7 per cent. upon mortgage, willingly borrow under that form at 33 per cent. The transaction has no relation to the current rate of interest; but it is within the ability and convenience of the parties who contract. That is sufficient to explain it. Credit institutions, by furnishing circulating capital at lower rates to property owners and farmers, will alone be able to supplant this custom. —Contraventions of the law of 1807 are especially frequent, and occur with impunity in civil matters. One has only to consult the notaries to be convinced that, if mortgage loans were confined to the strict limits of the legal rate, there would be to-day, outside of Paris and the range of the capital, few serious and effective loans. By means of accessory agreements, immediate deductions, and various compensations, people succeed, while inscribing only the legal rate in loan contracts, in winning and retaining capital in liens on real estate. —As a general statement, it may be said that the only loans which the restrictive laws affect, are the large transactions in which an habitually low price for money renders that intervention at least useless. Those, on the contrary, which escape the action of the legislative enactments, and of the law of 1807 as well as the others, consist of transactions of slight importance and in which a high rate of interest is invariably found to be stipulated. This is true, especially of loans in retail trade and for a short term of credit. Those who loan by the week figure largely in that category. Those who loan by the day are a class of capitalists that should not be forgotten, and who, notwithstanding the high interest they obtain, render real service. —"In the Paris provision market," said M. Aubréy in his speech against the proposition of M. Saint-Priest, "a well-known trade in money is carried on: one keeps a shop of five-franc pieces, that is to say, a certain variety of a banker keeps an office in the market and delivers to merchants of the four seasons and to vegetable gardeners a five-franc piece. With this five-franc piece the small trader buys provisions and food which he goes and sells about the city. At the end of his day's work he returns; he has often earned two or three francs with the aid of that five-franc piece. Do you suppose it is hard for him to pay the banker who furnished him the instrument of labor the sum of 25 centimes from his day's profits? * * In this case the interest of the money is 1800 per cent. Some people wished to enter complaint in the name of the law; but the magistrates of the bar of Paris were obliged to recoil before the numerous and incessant cries of the opposition; this resistance derived its strength from the good sense of the people and the benefits of liberty." —It would seem that an investment by which money brings 1800 per cent. would call in the competition of capitalists, and that this competition would lower the rent of capital. Yet the loans which have taken in the French language the name of "loans by the little week" remain at a rate that varies little. The reciprocal advantages of the borrower and lender would not suffice to explain the permanency of so high an interest in these investments. To understand it we must consider the risks to which capital is exposed. The ambulating tradesmen are an essentially nomadic portion of the population: it is the business to which those have recourse, who, for the time being, can do no other, or whose indolence makes them shun labor. From such customers one can not expect great scrupulousness in the fulfillment of their obligations. Five-franc-piece bankers are those who most frequently become bankrupt. The petty dealer, who often spends in drink the day's earnings, consumes both capital and profits. To escape the surveillance and pursuit of the creditor, the debtor has only to migrate from one occupation to another, in the infinite circle of petty trades which spring up and multiply in the streets of Paris. The capitalist lends to strangers, to people who have neither a sou nor a trunk, and without other guarantee than their interest to meet punctually their obligations so as to create for themselves a species of credit, an interest which all do not comprehend. If the debtors were punctual and scrupulous, the creditors, renewing their capital eighteen times a year, would very quickly make their fortune. Many, however, become ruined; and the sphere of these transactions does not appear to enlarge, which proves that there is in them a commingling of good and had chances. —And now, I ask, are not the laws which restrict liberty of interest judged, when we see that, for one transaction at 6 per cent. which they prevent in the average sphere of credit, they tolerate or do not prevent a little lower down the scale of loans, numberless public operations every day, in which the usury extends to 1800 per cent. per year? —IV. BASIS OF INTEREST. It is time to abandon the historical controversy to examine the foundation of interest. Three principal elements co-operate to determine it: the rent of capital; the premium on the insurance to cover the risk, and, in a great number of cases, the charge for commission; and the salary of the intermediary who puts the borrower in communication with the lender. The rent of capital, the instrument of labor, the motor which sets commerce, agriculture and manufactures in motion, is the principal element in interest. How is its rate determined? and what is its measure? Has this element anything fixed, which depends not on places, time or persons? or must it vary with circumstances and according to individuals? There is, we know, no such thing as unchangeable value; the notion even of value, arising as it does from the idea of relation, implies change. The rent of capital, like the price of all things, must vary under the action of demand and supply; and the law of demand and supply is itself subordinated to all the vicissitudes of production as well as of consumption, not to speak of the influence which progress or decline in means of transportation may exercise. One may not, then, prejudge what the rent of capital should be; but should confine himself to stating what it is. The observation of facts must rule in this matter. No doubt it is recognized in studying the economic history of peoples, that the rent of capital diminishes as wealth increases. But it should also be remarked that, through that incontestable tendency to a fall, the oscillations of interest become more frequent in proportion as commercial relations, developed by increased comfort and intelligence, come to multiply. The rent of capital varies, perhaps, less, in that descending progression, from one century to the following one; but from one year to another, it changes more. Credit, which formerly seemed to have nerves of steel and a hardened epidermis, has contracted the impressionable nature and delicate temperament of the sensitive. One can then determine the rent of capital only approximately, under given circumstances and while these circumstances continue. The system which would make the government regulate the rate of interest, to remain true and not deviate from the facts, would require the rate to be revised each month, each week; and, in some cases, each day; but a rule that required incessant alteration would not be a rule. This system is then condemned either to unchangeability of interest which is contrary to justice, or to an incessant change which would be the negation of law. As to the theories whose pet chimera is a fixed and in some sort normal interest, we will speak of them only to recall a few facts. The bank of France attempted to put them in practice, by maintaining the rate of discount at 4 per cent., in times of pressure as in periods of prosperity; but its resistance was finally overcome: in 1847 it was obliged to raise its rate of discount to 5 per cent. in order to arrest the export of specie; and in 1852, not to remain outside of the business world, it reduced it to 3 per cent. —The second element in interest is the tax for insurance or risk. This may be considered as still more variable than the preceding, and is certainly more difficult to estimate. The rent of capital is, as it were, the real part of interest, the part which is regulated by the value of things, the state of the market; and insurance is the personal part. The risk changes not only with the circumstances, but also with the situation and character of the borrowers: it is almost nothing in loans made on bills of exchange or notes payable to order which have several good indorsers; it is considerable in the case of a borrower who gives only his guarantee, and the lender raises the premium for the risk in proportion to the lack of solidity in the guarantee. This weakness of the guarantee may be diminished by the confidence of the lender or increased by his mistrust. This is an element to be taken into account, which, because it is personal on both sides, touches closely upon the arbitrary. "He who loans his capital," says M. Aubréy, "with risk of losing it in whole or in part, renders a greater and consequently better remunerated service than he who loans his capital without risking anything; this is what constitutes the difference between the lessor of real estate and of personal property; because the capital of the one always preserves its identity easy to establish, and is often secured by privileges and mortgages, while, on the contrary, the capital of the other is capable of being consumed by use and absorbed without return, as interest and principal; this is also the difference between the civil and the commercial loan, as well as the loan on pledge (pawn-loan), between obligations on short time and on long time, between maritime contracts and land contracts." The extent of the service is not measured by the extent of the risk; but he who consents to loan his capital, without the certainty of recovering it when due, is right in demanding of the debtor a premium for insurance against this danger: this is not a remuneration, it is simply a compensation, a guarantee. But whether remuneration or guarantee, in doubtful cases a prudent creditor would not dispense with this supplement to the rent of capital; yet it is not always sufficient to preserve him from ruin. When M. Proudhon said that the interest of money represented the risk, the chance that might befall, alea, he then exaggerated the truth, he took the part for the whole, he left out of account the very basis of interest, which is the rent capital gives. But even this shows that he took account of one element which all legislation has disregarded. —The socialist school, in the theory of gratuitous credit, substitutes for the premium on the risk, a sort of mutual insurance which unites all those making exchanges in the bonds of universal solidarity, and which makes every member of society bear his part in the consequences of the bad speculations or bad chances of all. This is not distributive justice: for the people who offer securities are put in the same category as those who offer none. The socialists make the moral being which they call society intervene in human affairs in exactly the same way as the ancients had their gods engage in them. Society, as they picture it in their romances, distributes subsistence and even wealth to all individuals; all the difference consists in having the manna come from the bank of the people, or the phalanstery, instead of descending from heaven. The people's bank having failed, and the phalanstery having aborted, we have to examine if it is possible, in the ordinary course of transactions, to establish any test or measure whatever of the risk. This element of interest obeys no rules, even for a day, even for a given case; it is an affair of opinion, a question of individual chances. There is nothing in it which one can generalize sufficiently to establish an economic principle, or a legal regulation. The element of risk interposes still greater obstacles than does the element of rent, to any attempt to fix or limit the interest on money. —The third element of interest is thus defined by M. Aubréy, who, as a banker, could speak from acquaintance with the subject: "The instruments of labor only reach the laborers through intermediaries; this is the consequence of progress. Capital in the form of money, being an instrument of labor, is as much under the law of division of labor as capital in any other form. As every one knows, capital is put in motion and circulates by the aid of motive agents called banks; labor improves and prospers by reason of the activity and abundance with which capital circulates in these great reservoirs; but every one should also know how much accumulated wealth, moral power and dignity of character is necessary, properly to direct these credit institutions. Now just these rare and valuable qualities, and this difficult and necessary labor in credit institutions, are remunerated by a charge for commission, which increases the interest on the capital furnished. M. Proudhon, in his people's bank, does not contest the legitimacy of this charge; for, when he decreed gratuitous credit, he reserved a discount of from 1 per cent. to 2 per cent. for expenses of administration. Is it possible to determine the measure of this third element? Evidently not. There are credit establishments of different kinds. The banker whose operations extend to millions in a day, takes only a very small commission and yet makes much money, while the petty dealer, who operates only with some thousands of francs, or with five-franc pieces, may charge a very high commission and yet earn but little; though he may give the same measure of his time and labor as the banker." —The above definition is neither complete nor altogether correct. Although it no more belongs to the government to regulate this part of interest than other parts, we must recognize that this contains an element more easy to estimate and less fluctuating. The institution of banks of circulation and discount has reduced the commission charge to small proportions, wherever their influence extends; yet even the state has a share in it, under the form of the stamp duty it puts on their notes. The commission charge of the intermediary bankers is often blended with the premium for risk: it is thus, for example, at Paris, where a discounter, for giving the third signature, and rendering a commercial bill acceptable at the bank of France, takes a premium or duty of 1 per cent., ¾ per cent. or ½ per cent. —In analyzing the elements of which interest is composed, we have seen that there is not one which gives a sure basis for estimating it. This has led M. Lherbette to say: "If you think there is a fixed, invariable basis for interest, why do you make it vary according to circumstances? and if you believe, on the contrary, that its basis is variable, why do you fix upon a rate from which the contracting parties shall not be allowed to vary according to the particular circumstances in which they find themselves and which they will understand better than you? In any case, if you determine to fix it, it will have to be continually modified; for circumstances constantly change; it would be necessary to establish mercurials for money as for bread." [The mercurials were registers of the price of grain and some other necessary provisions, and were formerly required to be kept in a public place in the market towns of France. E. J. L.] Even that would not be possible. The tax on bread embraces two or three qualities, of which it fixes the price by consulting the price of grain of corresponding quality; but the tax of interest does not depend on such simple calculations: in its case the rate in the mercurial would have to include as many qualities as there are particular situations, or individuals having recourse to credit. In the domain of credit, the list of classes is infinite: and this will infallibly baffle any pretension to a rule. Freedom in the matter of interest results not less from the powerlessness of the restrictive system than from the right which belongs to the contracting parties to dispose of their property as they think best. The experience of the past is here the most direct auxiliary of principles. —It is henceforth a recognized fact, thanks to the intelligence of our time, that interest on money is a legitimate value; why, then, should other conditions be imposed on it than on other values? When merchandise is in the warehouse or brought into market, its price is freely discussed between the buyer and seller; both find this method to their advantage; and the seller would carry away his goods as well as the buyer his money, if any one pretended to dictate to them the conditions of sale and purchase. In the matter of guarantees, both spurn the intervention of the state, and think themselves better off with free competition. Is there the least reason at all serious why trade in money should be excepted from the general law of trade? Sometimes society enjoys a tranquillity favorable to business, while again it passes through periods of monetary pressure in which every enterprise becomes difficult, and the activity of labor seems paralyzed. Money is sometimes scarce and sometimes abundant; the rent of capital must then vary, like any other value, according to circumstances. As to borrowers, they are not all equally solvent: on the contrary, they occupy, according to their morality, their reputation, and the competence they enjoy, various degrees in the scale of securities. Shall one say to a lender: "Whatever be the state of society, tranquil or disturbed; whatever be the abundance or scarcity of money; whether capital moves in full security or under the pressure of great anxiety; you shall loan your money on the same conditions and to all"? That would be unjust and absurd; one of two things would inevitably happen: either the prohibition would not be regarded, or capital would be refused, and society would have to manage as it could, to live without credit. Let us change the hypothesis. If a limit may be imposed on the profits of money capital by establishing a maximum rate of interest for money, why may not a maximum be fixed for every species of revenues, all kinds of transactions, and every sort of merchandise? If it is forbidden to lend above a certain rate of interest, why should it not be prohibited to sell above a certain price? The people have a much greater interest in not paying a high price for wheat in time of scarcity, than in finding loans at a low rate of interest. If money capital must not bring its possessor more than a certain per cent. yearly, why should the profit from capital in machines, land or manufactures be unlimited? Suppose I lend my neighbor $20,000, with which he purchases a spinning mill which gives him an annual return of 50 per cent.; why should not I be permitted to obtain what interest I can for my capital, when the borrower who receives this capital from me is free to derive any profit he can therefrom? —It is claimed that the interest of money is an exception to the general rules of trade. M. Paillet said that property rights must yield, the same as others, to public utility; and he compared the prohibition to loan above a certain rate, with the interdiction to build within the line of fortresses, with expropriation for the public good, with the prohibition to clear land, with all measures, in short, which society takes to protect the weak against the strong. Political economy does not contest the right of society; but it denies its applicability in this case. What public interest requires the state to regulate the rent of money? We find none. In a theocratic government, where the state is everything and does everything, that would perhaps be conceivable. The priests in that case fix the price of provisions, the form of garments and the number of ablutions. People are not astonished to see them interfere in the system of industries, when they behold their authority reaching even to the domestic hearth. But since the industries have come forth from their swaddling bands, and citizens of the same state can freely trade with each other, it is the interest of each and all that trade in money should be as free as in other commodities. What would the ability to buy and sell products signify, without any other rule than the price resulting from the relation between demand and supply, if capital, which begets the products, were subject to different conditions on the market? Competition determines the rent of capital as well as the price of merchandise; and that alone can bring about and surely will bring about a fall in the rate of interest. Only chimerical or violently-disposed persons demand other methods. —The adherents of the doctrine of the balance of trade thought that money, instead of representing the capital in circulation, was the capital itself of each country. This is why they subjected money negotiations to special rules. It was with this feeling that M. Jaubert, who reported the law of 1807, said: "If commerce gives itself up to speculations in interest, it goes out of its way, and will in the end arrest the progress of industry." As if capital, or rather accumulated labor, was intended for any thing else than to serve as a motor, and to procure profits for those who possess it. Communities live by tradition as much as by progress. We increase in stature because we rise on the shoulders of our fathers. Capital prepares the way for labor. The regulation of interest, as we know from the experience of our predecessors, is of no more service to labor than it is to capital. If it makes the latter unproductive, it prevents the former from development. But this system has consequences still more fatal to society than to the individual. It was decreed in France, by the law of 1850, that the maximum interest should remain fixed at 5 per cent. in civil matters. But that did not satisfy either M. Pelletier, who demanded money at 3 per cent., nor M. Proudhon, who aimed to reduce it to zero. The moment the people get the idea that it belongs to the law-making power to determine the rate of interest or to fix a limit to it, we are exposed to all the demands of anarchy. When the people, complaining rightly or wrongly of the hard times, come to demand a reduction in the annual interest, by what right can opposition be made? Will it be said, "We can not"? The legislators would then falsify their own action. Will they respond, "We will not"? That would be opening the way to revolution. The people would withdraw to the Aventine Hill, claiming abolition of debts; or, perhaps, to avoid paying them, or to pay them in paper money, they will send to the legislature, as certain departments did in 1849, socialistic revolutionists. Regulating interest by legislation is the first step of society toward bankruptcy; for it is the substitution of arbitrary law for the right to make agreements freely. —Freedom in the matter of interest is proper for all peoples who have attained their majority and who are governed by laws of their own making: but it is especially appropriate in republics. Where the right of a citizen to take part in governmental affairs is recognized, he can not, without injustice and contradiction, be denied the power to regulate as he pleases his own affairs; to buy, sell, lend or borrow on such conditions as the market offers. The component parts of the sovereign power can not be held in tutelage. It is ridiculous that the law should stipulate for them as for aliens or prodigals put under an interdict. Let them not be called upon to deliberate on the nature and direction of the government, if they are judged incapable of comprehending and defending their true interests; or if that honor is accorded to their independence and intelligence, let the horizon of sovereignty be at least extended to private transactions and the domestic hearth. —The United States probably owe some measure of their prosperity to the comparative freedom in the matter of interest. In New York discount has sometimes been taken as high as 18 per cent. per annum. At San Francisco money has been worth 4 per cent. or 5 per cent. a month. What matters it, after all, if those who borrow at this rate employ it so as to make still greater profits? —The rate of interest is generally in proportion to that of profits. Where industrial investments bring 12 per cent. to 15 per cent., it would be foolish to claim that one ought to borrow money at 4 per cent. to 5 per cent. The trade in money would, in fact, cease, if it could not take place under conditions similar to those prevailing in other industries. When, on the contrary, capital employed in agriculture and manufactures brings a return of 5 per cent. to 6 per cent., a moderate interest, say from 3½ per cent. to 4 per cent. is generally sufficient for the capitalist. Where the profits from agriculture are considerable, as in many of the western states, the remuneration of labor and of capital is high. Interest is high as well as wages. In Great Britain, on the contrary, where manufacturers, in order to become rich, must operate on immense quantities, the profit being very small on each fraction, capital obtains only a moderate interest. The abundance produced by the treasures accumulated by industry makes capital less in demand there than labor. —Harmony of these diverse functions in society can only result from liberty. It is liberty which has caused the growth of manufactures and has given wings to commerce. Liberty can alone regulate the interest of money, to the satisfaction of everybody. Capital can have no other master than itself; and its tyranny will be best avoided by not seeking to reduce it to slavery. A just balance will here arise from the relations naturally established between men and not from the laws they may be tempted to enact. —BIBLIOGRAPHY. 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Lucas, Paris, 1829, 8mo, pamphlet; Discussion on Usury, where it is demonstrated that moderate usury is neither contrary to the Holy Scripture, nor to natural law, etc., by Abbé Mastrolini, (translated into French from the 4th Italian edition, by the Canon of Annecy, and supplemented by a collection of the decisions of the Holy See on usury), Lyons, 1834, 8vo; Investigations made by the English Parliament in 1838 and 1841 on the effects produced by the Laws in regard to Usury; Monts de Piété (pawnbrokers' shops) and Banks which loan on Pledges, by M. A. Blaise, Paris, 1843, 1 vol., 8vo; Observations on the Usury Laws, by J. B. Byle, Serjeant at Law, (London?) 1845; Gratuitous Credit—a discussion between Bastiat and Proudhon, Paris, 1850, 1 vol., 16mo; Obstacles to Credit—considerations submitted to the commission of the legislative assembly, who examine the proposition of M. de Saint-Priest on usury, by J. Beauvais, Merchant, Paris, 1850, 8vo, pamphlet; Manual for Debates on Usury, Crédit Foncier (i e., loans secured by mortgage of real estate), Finance, etc.—a summary of the labors of the greatest thinkers, applied to France by a system immediately practicable, by Albert Polonius, Paris, 1850, 1 vol., 8vo; The Question of Usury, by Saint-Priest; Report of the Commission appointed to examine the Proposition of M. Felix de Saint-Priest on the Crime of Usury, by M. Paillet. The Moniteur of those times contains the speeches of MM. Aubréy (of the Vosges), Sainte-Beuve, Lherbette and Léon Faucher; in favor of the proposition by MM. Paillet, Saint-Priest and Corsan. Other writers have treated the subject of usury incidentally, among whom may be named Plutarch, Against Borrowing for Interest; Saumaise, Four Treatises on Usury, in Latin; Dumoulin, On Usuries; Voodt, De Pœnore; Scaccia, Questions; Montesquieu, Spirit of Laws; D. Hume, Essay on the Interest of Money (1752); Pothier, Loans, Contracts of Sale; M. Frémery, Studies in Commercial Law; Thieriet, Dissertation on Loans at Interest. To the above should be added: Some Considerations of the Consequences of the Lowering of Interest and Raising the Value of Money, by John Locke, 18mo, London, 1692; An Essay on the Law of Usury, by Mark Ord, Hartford, 1809, 8vo; Interest made Equity, by J. R. M'Culloch, N. Y., 1826; A Summary of the History and Law of Usury, with an examination of the Policy of the existing System, by J. B. Kelly, 8vo, Philadelphia, 1853; The History of Usury from the Earliest Period to the Present Time, together with a brief statement of general principles concerning the conflict of laws in different states and countries, and an examination into the policy of Laws on Usury, and their effect upon Commerce, by J. B. C. Murray, Philadelphia, 1866, 8vo; Labor and Loans at Interest, by Ch. le Lièvre, Paris (?); Labor and Usury in Ancient Times, by Ch. le Lièvre; Loans at Interest, by L. F. Vignon; A Treatise on the Law of Usury, Pawns or Pledges, and Maritime Loans, by R. H. Tyler, Albany, 1873, 8vo; Free Trade in Money the Great and Principal Cause of Fraud, Poverty and Ruin: Stringent Usury Laws the best defense of the People against Hard Times, etc., by J. Whipple, Boston, 1878. 8vo, paper; Encyclopedia of Commerce, article Interest, by Smith Homans; Appleton's Encyclopœdia, Johnson's Encyclopœdia, Encyclopœdia Britannica, article Interest. See also Poole's Index to Periodical Literature, under Usury and Usury Laws; also Saml. Jones Loyd's Testimony on Banks of Issue before the Select Committee of the House of Commons in 1840, queries 2841 and 2842; J. S. Mill's Political Economy, book iii., chap. xxiii.; H. D. Macleod's Principles of Economics, vol. i., pp. 215-219; Science of Wealth, by Amasa Walker, book iv., chap. vi.; Roscher's Political Economy, book iii., chap. iv.; Usury Laws: their Nature, Expediency and Influence—opinions of Jeremy Bentham and John Calvin, with review of the existing situation and recent experience of the United States, by Richard H. Dana, Jr., David A. Wells, and others, (Econ. Tracts, No. IV., series of 1880-81, N. Y., Society for Political Education); Essay on the History and Legislation on Usury, by Liégeois, Paris, 1863; Interest on Money and Usury, by M. Sabrau, Paris, 1865; Freedom of Money—official investigation into the project of repealing the laws which prohibit usury, by M. Dulae, Paris, 1865; Usury and Finance in relation to the Law of 1807, by M. Gorse, Paris, 1865. E. J. L., Tr INTERESTINTEREST, after the Historical Method. Several distinct yet fundamentally related inquiries arise with respect to interest. What are the causes that determine in a given age and country its general or average rate? What are the causes that determine its tendency to rise, to fall, or to remain stationary in the progress of society? What are the causes that determine its temporary fluctuations? —The causes determining its average rate have differed essentially in different ages and even in different parts of the same country in the same age. At a primitive social stage interest was unknown, and when the practice of exacting it emerged, it was considered immoral and generally prohibited by law. Archbishop Whately incorrectly defined man as an exchanging animal; exchanges did not take place in the earlier communistic stages of human progress. For a similar reason man can not be defined as an animal that pays interest on loans. The owner of superfluous wealth was in primitive times considered bound to lend it or give it gratuitously to any one in need; a distinct conception of individual proprietary right not having been developed. It was not until late in the reign of Henry VIII. that the payment of interest was legalized in England; a maximum rate of 10 per cent. being at the same time fixed. Before this act the receipt of interest was branded as usury, and contrary to both the common law and the canon law; although social exigencies, stronger than law, had in the later middle ages firmly established the practice of paying it, subject, however, to very different conditions throughout the country generally on the one hand and among mercantile people in the principal towns on the other. —Throughout the country generally, there was but little accumulation in the middle ages. If we take the produce of taxes as evidence, the pecuniary value of the whole movable property of England during the thirteenth and fourteenth centuries never amounted to a million. So late as 1523, it was estimated in parliament that all the movable wealth of the kingdom, money included, was under the value of three millions. A case, indeed, is reported in one of the year books of the reign of Edward III. from which it would appear that a deceased person had left goods and chattels to the value of 200,000 marks (£133,333), of which his widow claimed a moiety; but the amount is incredible, and is probably ascribable to some mistake of a copyist in the numerals. But if there was little accumulation, there was still less loanable capital. The great mediæval landowner was commonly needy, and his accumulations, if any, took the form not of loanable capital but of castles or manor houses, cattle, sheep, horses, arms, clothing, together with some plate and jewelry. One of the most instructive inquiries in economic history relates to the forms of accumulation in different states of society and different countries, and their causes; and it is an inquiry closely connected with variations in the rate of interest. One can without difficulty understand that the feudal lord built strong and imposing dwellings for power, consequence and security; and his possessions in cattle may also be easily explained. They were the natural produce of his land, and they fed a host of dependents in his hall. But if he rarely amassed money, it was not that the love of money was not strong in his breast, but because it was so scarce that even a thrifty noble with immense landed estates found it hard to procure. From the reign of Edward I. to the accession of Henry VIII. the entire amount of silver loaned in England was below £1,200,000, and the drain of money to the continent, especially by the papal court, during that period, was relatively enormous. Hence there was little money to lend in the country. Land, houses, cattle, sheep, and such kinds of property, movable or immovable, did not constitute loanable wealth. Loans, too, could not be effected by means of credit; the actual intervention of coin was necessary, and few persons had sums by them to put out at interest. The risk of the penalties on usury, and the rigor of the terms extorted by lenders under various covert devices, contributed to the difficulty of procuring loans, but the scarcity of money was a principal cause of the exorbitant rates of interest prevailing throughout Europe in the middle ages. Payments even to mercantile people in London itself were sometimes made partly in skins for lack of coin. Had banking and instruments of credit made it possible to effect loans without money, much lower rates of interest might have prevailed in spite of the penalties on usury. Hence the fall in the rate of interest in England, in the latter part of the sixteenth century, was undoubtedly caused in a great measure by the increase in the accumulation of money and the greater quantity entering the loan market after the influx of the precious metals from the mines of Potosi and the new coinage of Elizabeth's reign. In later times the growth of a system of credit has added so vastly in effect to the amount of loanable capital, that, unless in critical times when credit collapses, the quantity of loanable coin has no appreciable influence on the rate of interest, and would hardly be missed from the loan market. —It should be added, with respect to mediæval interest, that the customs of trade at length established in the commercial towns a rate with which the ordinary tribunals did not interfere. In England, in the reign of Edward III., the customary rate in London was 10 per cent., or half the customary rate of profit. We find here the emergence of the condition which in modern times has become the dominant one determining ordinary interest, but which in the middle ages operated only among the small number of trading people in towns, namely, the rate of commercial profit. The ordinary borrower in old times did not borrow to make profit, but because he was in immediate need of money to pay his debts. In modern times the fluctuations of interest are often caused by borrowing, irrespective of profit, on the part of persons or governments in immediate want of advances; but unless in critical states of trade, or on other extraordinary occasions, modern borrowing is chiefly on the part of people in business seeking to make profit on the capital thus obtained, and the interest they can pay is accordingly limited by the profit they can make. Thus, one of the fundamental differences between the causes determining mediæval and modern interest is, that the greater part of the capital lent in our age is lent to producers, and the main source of interest is the profit they make on production. There are still some unproductive private borrowers, and governments may pay interest out of taxes, but the general rate is determined by a commercial or industrial standard. —There is no other country in the civilized world in which the modern movements of interest, and the conditions affecting them, can be so advantageously studied as in the United States. Here the causes governing the rates in both old and new countries, and the course they follow as social and economic progress advances, can be investigated together. For, relatively speaking, the eastern states form an old country, the western states a new one; and again in the latter we can observe new regions at different stages of early development. The salient facts as regards interest are, in the first place, in the eastern states an average rate of interest not much above that prevailing in the chief countries of Europe; secondly, in the newest regions of the west an extraordinarily high rate, which has sometimes reached 25 per cent.; thirdly, a fall of interest in these new regions after cultivation and industrial development have gained considerable ground. To understand the significance of these economic phenomena we must take in connection with them some others no less remarkable. Wages, too, are found at their highest point in the new regions of the west at the beginning of their industrial career; they are lowest in the long settled eastern states; and they begin to decline in the western states when the first stage of their development has been passed. The explanation of the concurrent phenomena thus exhibited in the movements of interest and wages is simple. With the aid of the scantiest supply of capital the first Californian gold diggers might count on winning, on an average, an ounce of the precious metal, equal to sixteen dollars, a day. The first farmers could raise enormous cereal crops by merely plowing and sowing; and horses and herds, which they had only to take possession of, covered rich natural grass lands. Out of such returns both high wages and high interest could easily be afforded, and the scarcity of capital enabled lenders to exact a considerable proportion of the whole produce. But when the cream, as it were, had been skimmed by the first comers, both capital and labor had to content themselves with a poorer and harder earned yield. Gold was no longer to be won by mere digging, and needed deep and costly mining. The soil was found to require irrigation after a few crops had been raised, and even manure came into request. Not a herd was to be seen on the plains that was not marked with an owner's name. Capital was no longer scarce, but the returns were comparatively scanty. Nature did less and less to assist the advance of each successive wave of immigrants, until the difference between the productiveness of capital and labor in the new state and the old eastern states became one only of degree, not of kind. —It is objected, however, to this simple explanation of the phenomena of the coexistence of extraordinary high interest and extraordinary high wages in new and naturally prolific regions, and of the decline of both as such regions are peopled, brought under cultivation and developed by capital, so as to begin to display the features of long settled and advanced states, that the productiveness of labor and capital, that is to say, their wealth-producing power, is not less but greater in old than in new countries. In old countries, it is argued, the subdivision of labor is carried to a much farther point and directed with much greater skill, and their wealth is such that they not only support a large unproductive population, but have a numerous and rich idle class, whereas in new countries in their earliest stage every one is a producer. The richest states of America, it is pointed out, are not the western but the eastern, and the richest state in the world is Great Britain, with natural resources far inferior to those of Mexico or Brazil. But the single fact that labor and capital desert Great Britain for new countries affords conclusive proof that they are more productive, and therefore find more remunerative employment, in the latter. The wealth of England is no doubt greater than that of any new country, but a great part of its wealth is made not in England but in the very new countries in question. And the total wealth of England would be much less than it is, were the returns to English capital no greater in any other region than in England itself. England is rich because, on the one hand, it reaps harvests all over the world, and gathers the produce together into its granaries, and because, on the other hand, the aggregate capital it employs in production transcends calculation, although part of it yields but scanty returns from poor soils and inferior mines. A million might return 25 per cent. to the California corn grower and only 5 per cent. to the farmer in Middlesex, yet if for every million in California, there be a hundred millions in Middlesex, with London in its midst, Middlesex may have a revenue equal to that of twenty Californias; no inconsiderable fraction of it being, perhaps, actually drawn from California. —In these facts we find also a refutation of the theory that the appropriations of land and the growth of rent are the causes of the decline of interest in new countries in proportion as cultivation, industrial progress and population advance. When the farmer and the miner are compelled to resort to much more laborious and costly methods than those by which they gathered the first fruits that Nature laid at their feet, wages, profit and interest must decline, whether land be appropriated or not, and whether there be or not some fortunate owners of virgin soil and rich deposits of gold, from which a large rent can be drawn. There might be no rent, were all the more fertile soils and mines so exhausted that capital and labor were driven altogether to parts of the new state which the earlier immigrants had passed by with contempt, but the absence of rent would not prevent a fall of both wages and profit, and of the interest which the lender of capital derives from the gross profit it yields. To call the rise of rent the cause of the fall of interest, is to mistake the effect for the cause. As population advances, land with inferior natural powers or advantages is resorted to, and superior fields for the employment of labor and capital can thus afford a rent. Whether this rent is appropriated by the central government, or belongs to the first settlers, wages and interest must fall. It is true that were the government to become the sole landowner, its revenue in rent might enable it to dispense with taxation, thereby setting trade free from fiscal burdens and fetters, and so raising indirectly the return to labor and capital. But this would be the result of the absence of taxes and restraints on production and commerce, not of the absence of rent. —The general rate and movement of interest thus depend mainly on the profit which the capital employed in production holds out, and the movement will be downward as resort to less productive natural resources becomes requisite, unless science and art supply the deficit created by the failure of the bounty of nature. In the infancy of their development new countries afford a rate of interest which will never again be attained in later stages of their career, but whether interest must continue to decline throughout every stage of social advancement, is a question that can not be decisively answered, because the resources of science and art and the future powers of production of the human mind are beyond prediction. The human mind is a source to which capital may look for profit after some of the chief material sources at present known shall have begun to fail. —Although, however, the rate of profit determines the limit or maximum of interest, because the managers or employers of borrowed capital can not pay more than they make by its use and must reserve part for their own remuneration, it does not determine either the proportion of gross profit that interest absorbs, or the temporary fluctuations of the latter, which often bear no relation to profit. The proportions of profit falling to the share of lenders as interest depends on the amount of loanable capital, on the one hand, and the demand for it on the part of both productive and unproductive borrowers, on the other hand. A high rate of interest tends to diminish the number of persons engaged in business and employing their own capital, and therefore increases the supply of loanable capital; while a low rate forces a greater number of capitalists to employ it themselves and to add the remuneration of management to interest, and thereby diminishes the supply feeding the loan market. —Temporary fluctuations of the rate of interest result from a variety of causes, of which the chief is the state of credit. In ordinary times considerable loans are for the most part effected without the intervention of money in the proper sense of the term, but when credit collapses, nothing but cash is an available medium. The need of loans on the part of traders in difficulty becomes at the same time more and more urgent in proportion as credit contracts, so that at such periods the interest even people in business are ready to offer may bear no relation to the rate of profit in commerce. There are occasions, too, on which an urgent demand on the part, not of people in trade but of governments, is the chief condition operating on the loan market, and trade profit here again supplies no standard by which to estimate the terms on which loans are effected. Many other causes produce sudden divergences of interest from the rate which the standard of commercial profit would fix. The supply of money at call, for instance, may be abundant, and loans for a few days be obtained at little above 1 per cent., while the rate of discount on advances for three months may exceed 3 per cent. —It must not be forgotten that the profit which trade offers is, after all, speculative only; it holds out, not a certainty, but a probability or expectation. The interest, therefore, which lenders of capital can look for is likewise speculative or probable only. Nevertheless this speculative interest is the principal condition governing the rate on the safest investments, such as the government stocks of countries like the United States, Great Britain and France, and determining their price in the market. If a man has drawn a ticket in a lottery which gives him an even chance of winning $100, the ticket is worth $50, and he is not likely to part with it for $40. In like manner, if he has a probability of making 20 per cent. on an investment in trade, he will give only half the price for government stock that he might have given were 10 per cent only the expectation, on equal probability, held out by trade. T. E. CLIFFE LESLIE. INTERESTSINTERESTS, Moral and Material. Man can not do without bread, and the expression of this daily need forms part of the short prayer which Jesus himself taught his first followers; but it is equally true that man does not live by bread alone. He is composed of two elements, soul and body, intellect and matter; and this duality of his nature involves a duality of desires and appetites, one belonging to his soul, the other to his body; hence also that duality of interests which are qualified as moral and material, the former tending to the more and more complete satisfaction of certain spiritual wants, and the latter to the acquisition of the greatest possible amount of physical well-being. —Moral interests are to-day understood to mean the practical advantages which result from the progress of sound public education and advancement in the philosophical and moral sciences; and by material interests are meant the developments made by human industry and the conquests which the progress of the natural and physical sciences necessarily secures for it. These two kinds of interests are then, in their final analysis, the two terms of the great synthesis expressed by the word civilization. Hence, it is in this same sense that it has been said that "the two great means of advancing civilization are to propagate morality and industry, in order to render customs more benevolent and competency more general;" and moral civilization has been defined "the sum of the faith, laws, manners and virtues of a people, that is to say, the very end of the existence of nations;" and material civilization "the progressive development of trades and arts purely manual, or of industry." —Bossuet says, in speaking of the Egyptians, whom we may style civilization's firstborn, "they knew from the first the true end of politics, which is to render life comfortable, and the people happy." —No one says to-day, with J. J. Rousseau, that "everything is good when it leaves the hands of the Creator, but everything degenerates in the hands of man;" no one any longer maintains, with him, that man necessarily recedes, in a moral point of view, every time that he makes a step forward in the way of material civilization. No one now refers us back to savage life as an ideal of happiness, from which we are to be every day farther and farther removed; and the golden age which the poets showed us in the past, at the beginning of the existence of our race, is henceforth to be seen only in the future, as the end and recompense of man's efforts through the ages. Indeed, moral and material interests are not contrary one to the other, nor even essentially distinct. It is not true that the easy life, as Bossuet says, or the prosperity and morality of a people, are exclusive of one another, and that material well-being is developed only at the expense of public morality. It can not be truthfully said that men become morally corrupt in proportion as their condition improves materially, and that their civilization, so brilliant on the surface, is at bottom nothing but rottenness. This has been already absolutely demonstrated by the distinguished economist, de Molinari.—"In the first place," says this illustrious writer, "the history of civilization proves that those branches of human knowledge which contribute to the moral improvement of mankind, develop no less rapidly than those which tend to increase his material prosperity. Religion, for example, has, through the course of ages, improved and refined itself, and thereby exerted a more efficacious influence over man's morals. In this respect how far superior is Christianity to paganism! And can we not easily perceive a progress even in Christianity? Is not the Christian religion of to-day a more perfect instrument of moral development than it was at the time of St. Dominic and Torquemada? Do not the philosophical sciences, and especially political economy, succeed every day more effectually in rendering men more moral by showing them more and more clearly that the observance of the laws of morality is an essential condition of their happiness? In the second place, ought not material progress, far from being an obstacle to the moral development of the human species, contribute, on the contrary, to hasten it? Should it not, by rendering labor more fruitful, diminish the intensity and the frequency of the temptations which urge him to violate the laws of morality in order to satisfy his material appetites? Besides, these inductions, drawn from the observation of our nature, are confirmed by experience. The records of crime prove that the poor, other things being equal, are guilty of a greater number of crimes than the rich; they prove also that base criminality and crimes diminish in proportion as comfortable circumstances become more general in the lower walks of life. The objection of a pretended demoralization of the nation occasioned by the development of material well-being, is therefore at variance with observation and experience." —In fact, we can not see how the improvement of the conditions of our terrestrial existence, the invention of gunpowder, the discovery of printing, the innumerable applications of steam and electricity—we are at a loss to imagine how all these marvels of material progress, which have renewed the face of the earth, can be of themselves and virtually causes of corruption and moral decline. Is it not rather whatever binds man to the earth, whatever renders him dependent upon man, that is to say, slavery, that renders him brutal and degraded? Is it not whatever frees him from the fetters of matter, whatever emancipates him, that is to say, liberty, that elevates him and renders him capable of perfection? Does not the philosophy of history show that every revolution accomplished in the domain of industry is followed sooner or later by a corresponding moral progress? We say sooner or later, and it is in these words we must seek an explanation of the apparent contradictions which the gradual development of material and moral interests sometimes presents. This development is not always simultaneous and immediate on both sides. Moral progress, rendered possible by material progress, does not always go hand in hand with it; it delays sometimes, and it has its periods of interruption, but it infallibly follows material progress. To cite only one example, does any one believe that railroads, those powerful agents of equality and sociability among men, have already borne all the fruit that their establishment and actual extent render it possible for them to bear? Certainly not; but these are merely temporary inequalities, which will, when the time comes, be changed into brilliant harmonies. —If we but cast a glance at the comparative state of nations during the different phases through which they pass during even a single century, we shall readily appreciate, as in a tableau, this unequal but parallel and sure march of the progress of the human mind, this general equilibrium, which never fails to show itself, sooner or later, between the material and the moral interests of each country and of different nations considered in their entirety. We often hear our age reproached with its "worship of material interests," as if material interests were not worshiped in all ages, or as if our times alone were guilty of selfishness, thirst for gain and love of pleasure. We find these reproaches even in writers who, some pages further on, undertake to demonstrate that man is everywhere and always the same, that his surroundings change, but not his passions; and they support their doctrine by other analogous truths, which are the best refutation of our pretended exceptional perversity. For, as every one knows, the "worship" of material interests necessarily goes hand in hand with corruption. Now, we ask any one that has ever opened a volume of history, whether material interests and corruption are more prevalent in the nineteenth century than they were in the time of Louis XV., or of the regent, or of Louis XIV., or of the league, or of Louis XI., or when priests did not know how to read, or, finally, than among the Romans and Greeks. While writing these lines, facts crowd into our memory which demonstrate that men's passions have remained the same, that their expression alone is modified, and, thanks to the progress of education, improved. —In fact, the only difference there is between the past and the present is, that we have one additional means of restraining men's passions, or of moderating them, or of forcing them to conceal themselves. And it must be remarked that, in default of a higher motive, it is better that men should conceal their vices out of human respect, or for any similar reason, than flaunt them boldly before the eyes of all. The community is thus spared corruption by bad example at least; and besides, restraint is thus put upon one's self, and the number of one's defects lessened. This means is public opinion. There has existed a public opinion at all times, but its action was very restricted. There were at first very few educated men, and between the opinions of the learned and the ignorant there was an abyss. The invention of printing, the creation of a daily press, the diffusion of education, have increased a hundred-fold the force of public opinion. Public opinion has become a check upon evil, a stimulant to good, and as the average of education has been raised, which means that education is enjoyed by millions of individuals who were formerly left groping in superstition, and in the fanaticism which springs therefrom; as the average of education has been increased, we say, men know better how to distinguish good from evil, and this knowledge is frequently all that is needed to determine their choice. —This century is reproached with the worship of material interests! But this worship has never existed in a less degree than now. Material interests can never be suppressed. So long as we have material wants, we shall have material interests, and if the progress of the sciences renders it possible to more than satisfy these interests; if physics, chemistry and mechanics multiply wealth, so much the better, for wealth increases education, and education strengthens morality. Our opponents think they have closed the discussion when they have spoken of stock-speculations and luxury; but did not our forefathers dabble in stock-speculations? It is true that they did not speculate in railroad stock in the time of Cicero. As to luxury, you will find it in the stone age, for what else but luxury are those rude designs that embellish the ancient relies of this period? Luxury and art go hand in hand, and just as poetry preceded prose, so also has art preceded science. Who knows but that our most important inventions are due to the need we feel of embellishing what surrounds us. —To sum up, if vice unfortunately abounds in our day, it is certainly less wide-spread than formerly. No matter what may be said to the contrary, our age is more disposed to sacrifice material to moral interests than any that has preceded it, for formerly the very name of virtue was unknown to the uneducated masses; in the middle ages, the idea of fatherland was but very little diffused; the political passions that play so important a part in our time were scarcely known; in fine, the very idea of moral interests is modern. An epoch should not be judged by certain prominent and exceptional facts; we must examine it in its entirety, deliberately and impartially. We allow ourselves to be too much impressed by certain kinds of opposition, and take certain sayings too literally; it is not possible that we are worse than our fathers; sound reason and facts concur in refuting such assertions; but everything imposes upon us the duty of using every effort to make our children better than we are ourselves. MAURICE BLOCK. INTERIORINTERIOR, Department of the. While every European government has long had its ministry of the interior, or department of internal affairs, it was not until 1849 that the United States established what is called in the title of the act (though nowhere else), the home department. Up to that time the important functions now exercised by the secretary of the interior were distributed among four other departments of the government; the secretary of state had charge of patents, copyrights, the census, and public documents; the secretary of the treasury had the business of the public lands, mines and mining, and judicial accounts; Indian affairs were in charge of the war department, and the business of pensions was divided between the secretary of war and the secretary of the navy. All these varied departments of the public business (except copyrights), to which were added by subsequent laws the bureau of education, the Pacific railways, the public surveys, the territories, and the charge of certain charitable institutions in the District of Columbia, were assigned to the secretary of the interior by not of March 3, 1849. (9 Stat. at Large. 395). —The secretary of the interior is appointed by the president and senate, salary $8,000, and is by custom, though not by law, one of the seven members of the cabinet. He is required to make an annual report as to the public documents received and distributed under general laws, and he makes frequent special reports to congress, on call of either house or otherwise, concerning the business of any of the half-dozen bureaus subject to his supervision. All communications to the president or to congress from the heads of these bureaus are required to pass through his hands. —There are in the interior department, besides the clerical force attached to each bureau, an assistant secretary of the interior, salary, $3,500; a chief clerk, salary, $2,750; and 103 clerks, laborers and watchmen, drawing, in aggregate salaries, $115,190 per annum. There is also an assistant attorney general for the interior department, with five clerks, whose salaries aggregate $9,450 per annum. The secretary's office has seven divisions, each with a chief and clerks attached, these are known as those of appointments, of disbursements, lands and railroads, Indian affairs, pensions and miscellaneous, public documents, and stationery and printing. The vast extent and variety of the public business which passes through the office of the secretary of the interior demands executive abilities of the highest order in the head of that office. The rapid territorial development of the country, the public geological and mineralogical surveys, the sales, settlement and surveys of the public lands, the legal relations of the transcontinental railroads to the government, the care of the great Indian population with the purchase of their supplies, the execution of treaties with the tribes and the constantly recurring removals of the aborigines, the enormous business of pensions for army and navy service, the great and rapidly increasing business of patents for inventions, the census office with its periodically recurring and complicated labors, the custody and distribution of the vast series of public documents, the charge of hospitals and asylums at the seat of government; these and other weighty public interests demand a comprehensive skill, wide legal and general knowledge, and prompt capacity for business scarcely paralleled by any other department of the government service. While the heads of the various bureaus in the interior department have entire charge in detail of the business belonging to their offices, the secretary of the interior has the ultimate decision of all questions involving government action, with few exceptions. The secretary has also the power of appointing the clerks and subordinate officers in most of the bureaus, thus constituting a large patronage. All patents issued in the name of the United States must be signed by the secretary of the interior. —The multifarious business of the department of the interior, originally concentrated into one extensive building near the centre of Washington city, has expanded so prodigiously as to require many of its bureaus and more than half its official employés to be colonized in other localities. The bureau of education has its offices opposite; the geological survey is established at the National Museum; the pension bureau occupies a large building on Pennsylvania avenue; and the various divisions of the census office are distributed in rented buildings elsewhere. —The following is a list of the secretaries of the interior from the first, with the time of their respective appointments:
A. R. SPOFFORD. INTERNAL IMPROVEMENTSINTERNAL IMPROVEMENTS (IN U. S. HISTORY), a party question in the United States from 1820 until 1860. There has been very little objection to internal improvements where the jurisdiction of the improved property passes to the United States, as in case of lighthouses, forts, etc. The opposition has been to improvements where the jurisdiction has remained in the states, as in case of canals, rivers, harbors, etc. —I. 1789-1820. Under the articles of confederation each state exercised the right to control commerce, to levy duties, and to expend the proceeds at its discretion, with the proviso that the imposts or duties should not be levied upon the property "of the United States or either of them," should not conflict with treaties of the United States already concluded or provided for, and should not prevent the transfer to other states of goods imported. —In the convention of 1787, Sept 15, after the control of commerce had been given to the federal government, a provision was offered that "no state shall be restrained from laying duties of tonnage for the purpose of clearing harbors and erecting lighthouses." It was at once suggested that there were other purposes for which tonnage duties might conveniently be levied by the states; and the provision was altered to the more general form, "no state shall, without the consent of congress, lay any duty of tonnage." It was then incorporated into article one, section ten, paragraph three, of the constitution as it now stands. (See CONSTITUTION.) The intention of this provision is very evident, if we consider its original form, as above given, the geographical position of the states which then composed the Union, and the practice under it for thirty years. Every state, at the time, had seacoast, a seaport or seaports, and ocean commerce, more or less important. It was not until 1791 that Vermont, the first entirely inland state, was admitted. The original intention of the constitution, then, was that each state should control entirely the improvement of its own seaports, levying for that purpose duties upon the commerce which should enter them; but that the consent of congress should first be obtained, in order to guard against abuses—This was for many years the invariable practice. Whenever a state wished to improve any of its seaports or navigable rivers, its legislature passed an act to levy tonnage duties upon the commerce of the place to be improved; an act of congress approved the levy, for a limited time, and gave it validity; and the proceeds were expended under the direction of the state. One act of this nature, passed by Maryland in 1790, was continued in force until 1850, by successive "assents" of congress. There is no instance during this period, nor, indeed, until the act of March 3, 1823, hereafter referred to, of the expenditure of the national revenues for the improvement of rivers and harbors. Two "assenting" acts of congress are cited among the authorities, as instances of the practice during this period; the whole number (34) is too large for special reference to each. All the "internal improvements" provided for on the coast during this period were those in which the jurisdiction remained in the United States, such as "lighthouses, beacons, buoys, and public piers," for which congress appropriated money steadily after Aug. 7, 1789. These appropriations required as a prerequisite that the states should cede the sites of lighthouses, etc. —Since the original thirteen states ratified the constitution, no other states fronting on the ocean have been admitted, excepting Maine and Florida on the Atlantic, and California and Oregon on the Pacific. During the remainder of this period nine new states were admitted, all of which were growing rapidly, and none of which touched the Atlantic. This rapid influx of inland representation into congress soon began to work a change in the original conception of the powers of that body as to internal improvements. It seemed unfair that states which possessed seaports should be allowed to provide for internal improvements by levying duties, to be paid ultimately by inland consumers, while inland states should be left to make their necessary internal improvements at their own expense. In 1806 this idea took shape in a provision for a great turnpike road, to be built at national expense. (See CUMBERLAND ROAD.) It was to penetrate the western states and be the means of transmitting emigrants and mails in peace, and troops in war. Its constitutionality was variously defended upon the ground of the powers of congress "to provide for the common defense," "to establish post roads," and "to pass laws necessary and proper for carrying into execution" the foregoing powers; but the system found then, as it has always since found, a solider justification in the idea of "an equal division of benefits." In this instance the division recognized both the northwest and the southwest, for the bill for the Cumberland road was balanced by a bill for opening a road through Georgia on the route to New Orleans. From this time for thirty years bills for the construction of roads through the various territories were passed in great abundance. In congress it was first suggested by Henry Clay in the senate, Jan. 12, 1807, that a quantity of public land should be appropriated for the construction of a canal around the falls of the Ohio; and a bill for that purpose passed the senate, Feb. 28, but was not considered in the house. March 2, a senate resolution called on the secretary of the treasury for a plan for opening roads, canals, etc., at national expense. April 4, 1808, Gallatin submitted a voluminous report recommending a system of roads to cost $16,000,000. It was not acted upon. —From the beginning the constitutionality of appropriations for the construction of roads was warmly denied, and by none more steadily than by the successive presidents, Jefferson, Madison and Monroe. All of them refused to be convinced that the building of roads in different parts of the country was such a matter of "general welfare" as to justify the expenditure of the public moneys. All of them, however, approved the advisability of such measures, if they could be constitutionally effected, and urged an amendment to the constitution, to give congress the doubted power. (See CONSTITUTION, III., B. 3.) But in deference to the scruples of the presidents the roads were built through the territories, or, where they passed through a state, were constructed under a compact with the state, and by its consent. —During the war of 1812 the American armies on the frontiers labored under great disadvantages, owing to the almost entire want of efficient means of transportation. One consequence was, a great development of the idea of internal improvements, and its extension to include canals. In the great state of New York it took shape in the construction of the Erie canal. (See NEW YORK; CLINTON, DE WITT.) In congress a bill to set apart the bonus and government dividends of the national bank (see BANK CONTROVERSIES, III.), as a fund "for constructing roads and canals and improving the navigation of watercourses," passed the house Feb. 8, and the senate Feb. 27, 1817. Among its warmest advocates was Calhoun, who had introduced the proposition both in this and in the previous session, and who defended it on the broad ground that "whatever impedes the intercourse of the extremes with the centre of the republic weakens the Union," and that it was the duty of congress to "bind the republic together with a perfect system of roads and canals." Henry Clay, however, had been the real father of the scheme, and he never deserted his offspring. March 3, 1817, in the last moments of his official life, President Madison vetoed the bill, for the reason that congress had no constitutional power to expend the public revenues for any such purpose. An effort to pass the bill over the veto failed. The new president, Monroe, in his first annual message, while admitting the great advantage to be derived from a good system of roads and canals, declared it to be the settled conviction of his mind that congress did not possess the right to construct it. The attempt was therefore dropped temporarily, with the salvo of a house resolution, passed March 14, 1818, that congress had power to appropriate money for the construction of roads and canals, and for the improvement of watercourses. —II. 1820-60. The pronounced success of the Erie canal, and its evident bearing upon the prosperity of the state of New York, gave a new impetus to the internal improvement idea. Appropriations had already been made by congress for the preservation of exposed islands, and occasionally army officers had attended to the removal of annoying obstructions in navigable rivers. March 3, 1823, the first act for harbor improvement at the expense of the United States was passed by congress. It seems to have been due, in great measure, to an expression in President Monroe's veto of the bill for the preservation of the Cumberland road, May 4, 1822. He had vetoed it because of its attempt to assert jurisdiction by establishing turnpike gates, tolls, and penalties for their infringement; but he acknowledged a considerable modification of the opinions given in his first annual message. While his own opinion still was that an amendment to the constitution was necessary to give congress the power to construct a general system of internal improvements, he now held that congress had the power to appropriate the public moneys at its discretion; and that though it was in duty bound to select objects of general importance, it was not the province of the president to sit in judgment upon its selections. This idea was more fully exemplified in the act of April 30, 1824, appropriating $30,000 for the survey of such roads and canals as the president should deem of national importance, and in the act of March 3, 1825, ordering a subscription of $300,000 to the stock of the Delaware and Chesapeake canal. —The inaugural address of the new president, John Quincy Adams, warmly commended Monroe's internal improvement policy, and promised an adherence to it. Through his term of office appropriations for this object increased in number very rapidly; the board of engineers appointed under the act of April 30, 1824, was steadily engaged in pushing forward the surveys for new improvements: and every annual message of the president laid special stress upon the importance of this feature of the government's operations. This part of the "Adams and Clay policy" was one of the great moving causes which led to the new development of two opposing parties, and the overthrow of Adams at the election of 1828. (See DEMOCRATIC PARTY, III.; WHIG PARTY, I.) —In his first annual message President Jackson condemned the constitutionality of an internal improvement system, but advised the adoption of an amendment to allow congress to apportion the surplus revenue among the states. The first session of congress under his administration did not agree with his views. Internal improvement bills, aggregating $106,000,000, were reported by the committees, and the probabilities were in favor of the passage of very many of them. The first important one which reached the president was the bill to authorize a government subscription to the stock of the Maysville and Lexington turnpike road, in Kentucky. May 27, 1830, the bill was vetoed in a message which summed up all the objections to the internal improvement system. The bill was not carried over the veto. May 29, two similar bills were passed. The president got rid of these by a "pocket veto." (See VETO.) —The Maysville road veto ranged the president distinctly against the internal improvement system. Throughout the remainder of his two terms of office few acts were passed for this object, and these were vetoed. But through that feature of the presidential veto by which the president is compelled to sign or veto an entire bill in gross, without the privilege of vetoing particular provisions (see RIDERS, VETO), appropriations for detached improvements in great number were every year included in the general appropriation bills. The president was thus compelled either to approve the objectionable minor features of the bill, or, by vetoing the whole bill, begin a war of annoyances with congress. This is the form which appropriations for internal improvements have ever since regularly taken. —This change in the method of appropriations should be remembered in connection with the following table of appropriations for internal improvements under different administrations, as collected by Wheeler, cited among the authorities: Jefferson, $48,400; Madison, $250,800; Monroe, $707,621; Adams, $2,310,475; Jackson, $10,582,882; Van Buren, $2,222,544; Tyler, $1,076,500. —The two new national parties at once began the system of nominating conventions which has ever since obtained. (See NOMINATING CONVENTIONS.) The first convention of the national republicans (see WHIG PARTY, I.) asserted, in one of its resolutions, that "a uniform system of internal improvements, sustained and supported by the general government, is calculated to secure, in the highest degree, the harmony, the strength and the permanency of the republic." In 1836, 1839 and 1848 the whigs adopted no platform; in 1844 they approved the distribution scheme, hereafter referred to; in 1852 they finally approved the conjunction of protective tariffs and internal improvement known as the "American system." (See WHIG PARTY, II.) Their opponents were not ready to formulate a platform until 1840; from that time until 1864 they quadrennially condemned the internal improvement system in every form. Practically, however, "internal improvement," in its original form, died with the Maysville road veto. After that time the whigs had but one opportunity, after the election of Harrison, to enforce their views, and then they chose the "distribution scheme," hereafter referred to, instead; and the democrats, while condemning an internal improvement system, saw no objections to voting for isolated improvements in the general appropriation bill. Aug. 3, 1846, President Polk vetoed a river and harbor improvement bill which both houses had passed, and it failed. March 3, 1847, the last day of the next session, a bill for certain improvements in Wisconsin was passed and disposed of by a "pocket veto"; but at the opening of the following session the president sent his reasons for refusing to sign it, in a special message. The house, by resolution, declared that congress possessed the power to appropriate money for internal improvements; and with that the matter slept again until 1854, excepting that the house, in March, 1849, passed a river and harbor bill, which was not acted upon by the senate. In the session of 1853-4, President Pierce vetoed two bills, one for the appropriation of 10,000,000 acres of public lands to the states for the relief of insane paupers, and one for the improvement of rivers and harbors. Dec. 30, 1854, he gave his reasons for the latter veto in a special message, whose arguments were those of President Polk in 1847. This phase of the question of internal improvements then slept until 1870. —DISTRIBUTION. In 1829 Jackson had suggested a distribution of surplus revenue among the states, provided an amendment for that purpose could be ratified. In the following session a house resolution was passed for the distribution of the proceeds of land sales among the states. When the project next appeared, it had become a whig measure. April 16, 1832, Clay introduced a bill in the senate to provide for the distribution of the proceeds of public land sales among the states. It passed the senate, and failed in the house. At the opening of the next session, the president's message advised the reduction of the price of public lands to a nominal amount, or the cession of the lands to the states in which they were situated. On the other hand, Clay again introduced his bill, Dec. 12, 1832, which was debated, and passed both houses, March 2, 1833. It was not signed, and a special message of Dec. 4, 1833, assigned cogent reasons for the refusal to sign it. The bill appropriated 12½ per cent. of the proceeds of public land sales to the seven states last admitted (excluding Maine) for "objects of internal improvement or education," and 87½ per cent. to all the states according to population, to be distributed as the legislatures should deem proper. The objections were, in brief, 1, that the bill violated the compacts by which the original states had ceded their claims to the United States (see TERRITORIES); and 2, that congress had no power to appropriate the public revenues, directly or indirectly, for internal improvements. The bill was not passed over the veto. —The sales of public lands grew suddenly and enormously after 1830. For the previous ten years they had averaged about $3,000,000 annually; in 1836 they reached nearly $25,000,000. (see BANK CONTROVERSIES, IV.), and Calhoun estimated that at the end of the year the country would have $66,000,000 surplus in the treasury. He therefore introduced, May 25, 1836, an amendment to a bill to regulate deposits of public moneys in state banks (see INDEPENDENT TREASURY), providing that at the end of each year the money remaining in the treasury, reserving $5,000,000, should be "deposited" with the several states, in proportion to their representation in congress. The act became a law June 23. The president signed it with the greatest reluctance, and only in consideration of the amount of paper money already in the treasury; and his "specie circular" of the following month (see BANK CONTROVERSIES, IV.) seems to have been his method of cutting the Gordian knot, wiping out a paper money surplus, and checkmating Calhoun's distribution bill and internal improvements together. It ultimately had greater consequences. The first installment of the "deposit" was paid in January, 1837; the second in April, both in specie or its equivalent; and the third in June, in paper. By that time the "panic of 1837" had burst upon the country, and the fourth installment, in October, was never paid. The act of October 2, 1837, postponed it until 1839, when the treasury was in no better condition to pay it, and the law was repealed. The amount "deposited" was $37,000,000, which has never been recalled. —The return of the whigs to power with Harrison's election was marked by the passage of the act of Sept. 4, 1841, to distribute the proceeds of public land sales among the states. In this case, however, the distribution was to be suspended as soon as, and as long as, the duties on imports should rise above the maximum fixed by the compromise tariff act of 1833, which was to expire in June, 1842. Before this last date arrived, the conflict between Tyler and the whig party had become flagrant, and the majority in congress, were disposed to put a new pressure on the president. June 27, 1842, they passed an act for a provisional tariff, raising the duties above the compromise maximum, and yet retaining the distribution clause. Tyler had obtained the opinion of the attorney general that the compromise duties would remain in force after July 1, in default of the passage of a new tariff act; he therefore vetoed the bill, June 29. Aug. 5, a tariff bill, still including the distribution clause, passed both houses by narrow majorities, 25 to 23 in the senate, and 116 to 112 in the house; and Aug. 9 this bill was vetoed. (See CENSURES, II.) Aug. 27 congress yielded and passed the tariff bill without the distribution clause, and three days later it became law. Thereafter the distribution of public revenue or of proceeds of land sales among the states was no more heard of. —IN THE STATES. Space will not permit any full treatment of this division of the subject, for which the reader is referred to the authority cited below. The success of the Eric canal in New York state had prompted other states to imitate its design. Most of the state constitutions adopted from 1830 until 1850 contain either directions or permissions to the legislatures "to encourage internal improvements within the state." Where such enterprises were undertaken in states whose interests were agricultural, not commercial, and whose people were impatient of abstinence from the present enjoyment of capital for the prospect of possible future profit, the state's irresponsibility in courts of law led to but one result, "repudiation," a term whose first application in this sense is ascribed to Governor McNutt, of Mississippi, in 1841. European capital, tempted by high interest, and undeterred by any thought of "repudiation," flowed rapidly to the United States after 1830. The state debts, which were but $13,000,000 in 1830, reached $50,000,000 in 1836, and about $100,000,000 in 1838. When, after the crash of 1837, foreign capitalists undertook to withdraw, they found it easier to get their capital into state securities than to get it out. On one pretext or another, and sometimes on no pretext at all, a number of states repudiated, in whole or in part, their internal improvement debts, and, as they were irresponsible in their own courts, and, by amendment XI (see CONSTITUTION) irresponsible in the federal courts to citizens of other states, creditors were without recourse. (See also MINNESOTA.) The worst cases, at this period, were Maryland, Louisiana and Mississippi in the south, and Pennsylvania, Indiana, Illinois and Michigan in the north. Most of these have since paid or "accommodated" their debts. —The unwillingness to allow foreigners to brand all the states, separately or collectively, as "repudiators," was the parent of a proposition to assume the state debts for internal improvements. It was formally introduced in congress in July, 1842, met with warm opposition, and fell through in the following year. (For further information see STATE DEBTS, under the article DEBTS) —III. 1850-82. LAND GRANTS. A grant of 5 per cent. of the public land sales within the state had regularly been made to new states at their admission, the consideration being the exemption of the remainder of the public lands from taxation. Grants had been made also for state capitals and for universities. In 1850 began the system of grants of specified amounts of public lands to states for the encouragement of railroads. The first grant of this nature was by the act of Sept. 20, 1850, for the benefit of the Illinois Central railroad, coupled with a grant for the Mobile and Ohio railroad. Its inside history will be found in Cutts' work, as cited below. The number of acres, 2,595,053, was the largest granted by any single act until 1860. —The growth of the Pacific states, the difficulty of communication with them, and the vast extent of the intervening unsettled country, made very evident both the necessity of a Pacific railroad and the impossibility of constructing it by private capital. Before 1855 government surveys had ascertained practicable passes through the Rocky mountains; and in 1860 both political parties had declared, in their national platforms, in favor of the completion of the work by the federal government. The outbreak of the rebellion, and the necessity of a closer military connection with the Pacific, made the need for the road immediate and imperative, and it was begun by act of July 1, 1862, in favor of the Central Pacific, Kansas Pacific and Union Pacific railroads. The number of acres granted to railroads in every part of the country has grown enormously since that date; they will he found in the land office report cited below. The largest grants to single corporations have been 47,000,000 acres to the Northern Pacific railroad, and 42,000,000 acres to the Atlantic and Pacific railroad. The amount of bonds issued to the various Pacific railroads, interest payable by the United States, was $64,623,512. The grant of lands directly to corporations interested began with the act of July 1, 1862; before that date the grants were made to the states for the benefit of corporations. —RIVER AND HARBOR BILLS. After the veto by President Pierce of the river and harbor bill which was passed in 1854, this species of appropriation lapsed until 1870. Improvements which were imperatively needed were classed under "fortifications" and similar heads. The cessation of expenditures under this head, however, was far more than balanced by the appropriations for postoffices, custom houses, and other public buildings in various parts of the country. These increased until, in 1873-4, they amounted to $12,341,944. —In 1870 a river and harbor appropriation was made, amounting to $2,000,000. From this time appropriations of this nature were no longer covered up in other appropriation bills, but took distinct rank for themselves. In 1873 the appropriation rose to $5,286,000, and they have since generally remained above that amount, as follows: 1873-4, $7,352,900; 1874-5, $5,228,000; 1875-6, $6,648,517.50; 1876-7, $5,015,000; 1877-8,——; 1878-9, $8,322,700; 1879-80, $9,577,494 61; 1880-1, $8,976,500; 1881-2, $11,451,300; 1882-3, $18,743,875. This last increase in the appropriations provoked a veto by President Arthur, Aug. 1, 1882, but the bill was immediately passed over the veto. In such a mass of appropriations it is impossible that there should not be very many objects well worth the care of the national government; but, with every allowance, the amount of absolute plunder in the total must have been enormous. In debating one of these bills a member of congress declared from personal knowledge that one "river," for which an appropriation had been inserted, could be fitted for commerce only by being paved or macadamized; and this instance was certainly not an isolated one. In many cases the coveted appropriation is only to "secure the work," and compel succeeding appropriations to eight or ten times the original amount to complete it. Many appropriations are inserted, not upon their merits, but by "log-rolling," by an understanding among a number of members that each will vote for the appropriations demanded by all his associates. In fact, most of these appropriations are not for the public benefit at all, but for the personal interests of the legislators, for the re-election of a congressman often depends upon his success in "bringing money into the district" through the river and harbor bill, or the erection of public buildings. In this manner congress has probably squandered in twelve years money enough to have built a railroad from the Mississippi to the Atlantic, whose running expenses could be paid by the similar appropriations for the future. It is hard to say which of the two methods of getting rid of surplus revenue would be most demoralizing to the people. —See CONFEDERATION, ARTICLES OF, VI, IX; 5 Elliot's Debates, 548; 1 Stat. at Large, 184, 190 (assent of congress to acts of Maryland legislature). 1 Stat. at Large, 54 (first lighthouse act. Aug 7, 1789), authorities under CUMBERLAND ROAD; Adams' Life of Gallatin, 351; 2 Adams' Writings of Gallatin, 72; Tanner's Memoir on Internal Improvements (1829); 5 Benton's Debates of Congress, 665, 711; 3 Statesman's Manual (edit. 1849) xxviii., (Madison's veto) II. For this period in general the best authority is 2 Wheeler's History of Congress, 109; 1 Statesman's Manual, 491 (Monroe's Cumberland road veto); 3 Stat. at Large, 781 (act of March 3, 1823); 4 Stat. at Large, 23 (act of April 30, 1824), 124 (March 3, 1825); 2 Statesman's Manual, 719 (Maysville road veto); 3 Parton's Life of Jackson, 285, 340; 3 Statesman's Manual, 1635, 1711 (Polk's vetoes); 1 Webster's Works, 169, 347; 2 ib., 238; 4 ib., 247, 252; 5 Whig Review, 537; 1 Colton's Life and Times of Clay, 428, 1 Benton's Thirty Years' View, 102, 130, 167, 275, 362; 2 ib., 125, 171; Cluskey's Political Text Book, 540; Bradford's History of the Federal Government (see its index); Cutts' Treatise on Party Questions, 41; Gillet's Democracy in the United States, 132 DISTRIBUTION. 12 Benton's Debates of Congress, 124, 765; 2 von Holst's United States, 181, 454, 2 Calhoun's Works, 620; 5 Stat. at Large, 52, 201, 453 (acts of June 23, 1836, Oct 2, 1837, and Sept. 4, 1841); 2 Benton's Thirty Years' View, 36; 4 Opinions of the Attorneys General, 60, 63; 14 Benton's Debates of Congress, 443, 456. IN THE STATES. The best authority is 2 B. R. Curtis' Works, 93, being his article "Debts of the States" from the North American Review, January, 1844. III. Cutts' Treatise on Party Questions, 187; 9 Stat. at Large, 466 (act of Sept. 20, 1850); Reports of the General Land Office (1873); the same in substance is more easily accessible in Spofford's American Almanac for 1878, 237, and in Appleton's Annual Cyclopœdia for 1871, 674. The first Pacific Railroad act of July 1, 1862, will be found in 12 Stat. at Large, 489; a convenient summary of Pacific Railroad legislation is the long preamble to the act of May 7, 1878 (20 Stat. at Large, 56); Report of the Secretary of the Treasury (Dec. 5, 1881), 25; Major H. M. Robert's Index to Reports on River and Harbor Improvements (Art. "Appropriations"); Porter's West in 1880, 585 (and Map). ALEXANDER JOHNSTON. INTERNAL REVENUE OF THE UNITED STATESINTERNAL REVENUE OF THE UNITED STATES. Under the constitution congress has power to lay taxes, duties, imposts and excises. This provision includes every species of taxation, direct and indirect, specific and ad valorem; poll taxes, taxes on property, income, business, licenses, imports and tonnage. The only limitation placed upon this taxing power is that these taxes shall be uniform throughout the United States, and that direct taxes shall be apportioned among the several states which may be included within the Union, according to their respective numbers. In practice the national government has obtained its revenues from taxes on imports, and has resorted to internal imposts only when such have become necessary. The term "internal revenue" has been restricted in its meaning to such revenues only as are collected under the internal revenue bureau connected with the treasury department, and does not include all revenues that are, properly speaking, from internal sources, that is, from sources other than duties levied at the frontiers upon foreign commodities. Thus, moneys arising from the sale of public lands, from patent fees, or the revenues of the postal service, are not generally known as "internal revenue." As will be seen, a large number of taxes, direct and indirect, have been under the management of this bureau, which did not exist until 1862; so that no more exact definition of this branch of the public revenue system can be framed. —At the close of the revolution, to raise money by any internal taxes was hardly thought of. It is true that the provision in the constitution shows that the possibility of having recourse to such taxes was not overlooked: but in the then existing temper of the people it would have been impolitic, if not impossible, to put in operation any system of excises. Hamilton, in No. XII of the "Federalist," writes: "The genius of the people will ill brook the inquisitive and peremptory spirit of excise laws. The pockets of the farmers, on the other hand, will reluctantly yield but scanty supplies, in the unwelcome shape of impositions on their houses and lands, and personal property is too precarious and invisible a fund to be laid hold of in any other way than by the imperceptible agency of taxes on consumption"; and again he writes: "It has been already intimated that excises, in their true signification, are too little in unison with the feelings of the people, to admit of great use being made of that mode of taxation"; and he goes on to show that the possessors of land would not, in all probability, bear the burdens of any internal taxes. So strong was the prejudice against excises, that it was twice moved, in the New York convention for adopting the constitution, that the power of laying excises be prohibited to congress. Nor can this feeling against such taxes be referred only to a prejudice inherited from England, for there was a sound economic reason which effectually prevented the application at that time of internal duties and taxes. An elaborate system of internal taxes supposes a country well advanced in manufactures and general wealth, and at the close of the revolution the economic condition of the people and of manufactures was not such as to invite taxation. The country was impoverished by the long war, trade was confined within narrow limits, and manufactures were few in number; and forced, as many of them were, into an unhealthy existence, they could ill endure any increased burdens in the shape of taxes. On the other hand, the resources of the country had been severely strained by the war, there was no central government, and when such a government did exist, one of its first acts was to bolster up these manufactures by tariff duties on imported manufactures. —But an excise was soon proposed. In 1790 a measure for taxing distilled spirits of domestic manufacture was introduced into congress, but the opposition it at once aroused was sufficient to defeat its passage. The legislature of Pennsylvania instructed its representatives in congress to oppose the passing of an excise, "the horror of all free states"; and in a petition to congress the inhabitants of Westmoreland, Pa., claimed that to convert grain into spirits was as clear a natural right as to convert grain into flour. The proposed taxes would weigh heavily upon the farmers of the western counties of Pennsylvania. Owing to the distance of the markets and the great difficulty and expense of transporting such a bulky commodity as grain, the farmers were in the habit of converting their grain into whisky, and transporting it in that shape. Mr. Breckenridge, in his "History of the Western Insurrection," states that the still was the necessary appendage of every farm, where the farmer was able to procure it. And this petition from Westmoreland recites that "for these reasons we have found it necessary to introduce a number of small distilleries into our settlements, and in every circle of twenty or thirty neighbors one of these is generally erected for the accommodation of the neighborhood." —In the following year, under the advice of Hamilton, a like measure was introduced, and, after a bitter contest, was passed, March 3, 1791. Under this act spirits distilled from foreign materials (molasses) were taxed at a somewhat higher rate than those from domestic materials (grain and fruit), the discrimination amounting to from two to five cents per gallon, according to proof. There was also a difference made in the taxes imposed upon spirits distilled in cities, towns or villages, (nine to twenty-five cents per gallon), and those distilled in other places, (at the option of the distiller he could pay a yearly tax of sixty cents per gallon upon the capacity of the still, or nine cents for each gallon distilled). Notwithstanding the low duties charged, the opposition to it was very determined. The tax bore with great severity upon the distillers in the western part of Pennsylvania, at that time very thinly populated, for with them money was very scarce, and as trade was carried on by barter, spirits served as money. The most determined opposition came from that quarter. In May, 1792, with the hope of allaying in some degree the discontent, the rate of excise was somewhat reduced, and a further concession was made by giving to the distiller the alternative of paying a monthly instead of a yearly rate, with liberty to take out a license for the precise time he intended to work, and to renew it for a further term.30 And at the same time, with a view to possible resistance, measures were taken to provide for calling out the militia; thus curiously fulfilling a saying made sixty years before by an Englishman, "we know what a general excise is, and can not be ignorant that it hath an army in its belly." But the concessions made were not enough, and in September of the same year Washington issued a proclamation admonishing all persons to refrain from unlawful combinations tending to obstruct the operation of the excise laws; and it is worthy of note that he struck out from Hamilton's draft of this proclamation the sentence, "these laws were dictated by weighty reasons of public exigency and policy." But the open resistance to the measure (whisky insurrection, which forms an important chapter in the political history of this country) was soon put down. The general dislike, however, to the excise prevented an early and complete organization of the excise system. As late as 1795 the law had not extended to Kentucky and Tennessee, and the tax was but imperfectly collected in North Carolina; nor until that year was the system put in full operation in any part of Pennsylvania. However, the government had carried its point, and had not only established its right to impose an excise, but shown its power to enforce such a tax. —In 1794, under a fear of renewed hostilities with England, but ostensibly to defray clerk hire in the department of state, a fee was charged for all patents issued for inventions and discoveries; and to provide means for paying the interest upon money borrowed to pay the expenses attending the intercourse of the United States with foreign nations, internal duties were laid upon carriages for the conveyance of persons; upon licenses for selling wines and foreign distilled liquors by retail; upon snuff (eight cents per pound) and refined sugar (two cents per pound) manufactured in the United States; and on sales at auction (¼ per cent. of the purchase money arising from the sale of any right, interest or estate, in lands, tenements or hereditaments, utensils in husbandry, farming stock, or ships and vessels; and ½ per cent. of the purchase money arising from the sales of any other goods, chattels, rights or credits). The proceeds of these taxes, together with what accrued from the postoffice, land sales, and dividends on bank stock, formed the only sources of the internal revenue of the government. Of these, the land sales, postage on letters, patent fees and taxes on distilled spirits were permanent taxes, or commensurate with the existence of the debt for the payment of the interest of which they were pledged; and the dividends from bank stock were commensurate with the duration of the property in the stock. The other taxes were only temporary taxes, and were to continue no longer than till the end of the session of congress next after the expiration of two years from the respective times of passing the laws which established them, though their operation was extended in 1795. It should be noted that the debate upon this measure assumed a sectional character. Thus it was claimed that the tax upon tobacco fell almost wholly upon the middle and southern states; and as to the carriage tax, it was stated that there was not a single vehicle in the state of Vermont, and but two in the whole state of Connecticut, which would be subject to that tax. In his report for 1795, Hamilton says of these taxes, when discussing the advisableness of extending their operation, which was done: "It is believed that there can not be devised objects of revenue more proper in themselves, or more generally acceptable to the people. Whatever interested parties may allege, it seems self-evident that there can hardly be a reasonable question, except as to the best mode of collection. The objection that part of them falls on manufactures, has no weight. The manufactures on which they fall are complete luxuries, and completely established; consequently fit objects of revenue. The increased duties on the rival foreign articles are a full protection to the manufacture. Whatever may be the appearances in the infancy of the tax, it is certain, in principle, that it will finally fall on the consumer, as generally as duties on imported commodities." —Yet in spite of this able defense of his policy, the results of these taxes, when viewed in 1796, after an experience of from two to four years, did not prove their fitness to the circumstances or disposition of the people. The tax on spirits was openly resisted and secretly evaded; the tax on carriages produced but little on account of an uncertainty whether it was a direct or an indirect tax, a question which was finally settled by the supreme court of the United States; the drawback allowed upon exported snuff was so high as to act as a bounty, and so large were the quantities exported that the drawback paid exceeded the amount of collections, and this law was soon suspended. The sugar tax was productive, because, owing to the high import duty on sugar, the domestic manufacturers almost wholly supplied the home demand. Mr. Gallatin, in 1796, estimated the annual produce of all these internal taxes at $416,000. —In 1797 congress laid duties on stamped vellum, parchment and paper. Of this tax Mr. Gibbs, in his "Administration of Washington and Adams," writes: "The stamp act, although a very necessary one, as a certain means of raising money, had the misfortune of being exceedingly unpopular; certain disagreeable associations being connected with the name, which gave a handle to the opposition to work upon those who did not understand the relations between taxation and representation. It also, curiously enough, furnished a cause of jealousy to the president, who, from some reason, supposed it to exalt the powers of the secretary of the treasury at his expense." These stamp duties were however continued, but only as a temporary expedient, and yielded a moderately large revenue. —In the following year, when the relations between France and the United States were far from friendly, in order to put the country in a state of defense, a direct tax of $2,000,000, the first of its kind, was apportioned among the states. It was proposed that this tax should be assessed to individuals as follows: 1, on dwelling houses, which were distributed into nine classes according to the value, and taxed uniformly in each class; 2, on slaves, and 3, on lands, to be taxed at such rate ad valorem in each state as, with the sums assessed on houses and slaves, will produce the entire amount of the sums apportioned to the respective states; and, in anticipation of the amount of this tax, the president was authorized to borrow $2,000,000. —But with the accession of Jefferson to the presidency, an attack was made upon the system of internal taxes, and on his recommendation the act of April 6, 1802, to repeal all internal taxes, was passed, with outstanding, uncollected duties amounting to nearly $700,000. This sacrificed a large portion of the revenues of the government, but from 1802 to 1813 no internal duties on articles grown or manufactured in the United States were imposed. These taxes were to be laid only in the last resort, and were classed with loans, as extraordinary resources, and during that interval when a larger revenue was needed, the duties on imports were increased. In 1808, when a war cloud was impending, Gallatin wrote that no internal taxes, either direct or indirect, were contemplated, even in the case of hostilities carried on against two great belligerent powers; and he only expressed the general feeling of the people, who were strongly prejudiced against internal duties. —This early attempt to impose internal duties has thus been dwelt upon at length because it served as a model for later systems. The opposition that it engendered was not due so much to the taxes laid, for there could be no doubt that most of the subjects were eminently titled for taxation, as on account of a strong prejudice against the method of collecting. In order to prevent fraud and evasion of excises, a body of officials must be kept up, with powers of entering and searching the houses of those who deal in excisable commodities. The tax gatherer comes into direct contact with the tax payer, and in the strict performance of his duty creates a strong prejudice against himself, and renders himself odious to the people. Jefferson said, in his annual message of 1805, with his customary exaggeration, that the internal taxes covered the land with officers, and opened "our doors to their intrusions, beginning that process of domiciliary vexation, which, once entered, is scarcely to be restrained from reaching successively every article of produce and property." Herein is shown the true ground of popular dislike to internal or excise duties. —The existing revenues of the national government were wholly inadequate to meet the increased expenditure occasioned by the war of 1812, and in order to meet the deficits of 1812 and 1813 recourse was had to loans and issue of treasury notes. But it was soon seen that the revenues, including these loans, would not prove sufficient, and early in 1813 the foundation of a system of internal revenue was laid, by imposing those taxes which had been recommended by the experience of a former period, and which included a direct tax as well as excises. Again were these taxes, known as "war taxes," regarded as temporary, and their operation was to cease one year after the termination of the war; but with the exception of the tax on refined sugar, and the stamp duties on bank notes, bills of exchange, and other notes, they were afterward extended and pledged to the payment of the interest and principal of the national debt, or until they might be replaced by other taxes equally productive. All of the old taxes were imposed, excepting a tax per gallon on distilled spirits, which was replaced by a license tax to distillers. It was estimated that these taxes would produce a revenue of $3,500,000 annually, but this could not be had until the year following the passage of the act, and the inconvenience thus occasioned was commented upon by the secretary of the treasury in his report for 1815. "It may, perhaps, be considered as a subject for regret, and it certainly furnishes a lesson of practical policy, that there existed no system by which the internal resources of the country could be brought at once into action, when the resources of its external commerce became incompetent to answer the exigencies of the time. The existence of such a system would probably have invigorated the early movements of the war; might have preserved the public credit unimpaired; and would have rendered the pecuniary contributions of the people more equal as well as more effective. But, owing to the want of such a system, a sudden and almost exclusive resort to the public credit was necessarily adopted, as the chief instrument of finance. The nature of the instrument employed was soon developed; and it was found that public credit could only be durably maintained upon the broad foundations of public revenue." But in spite of loans and taxes the public revenues were not adequate, and in the middle of 1814 the national government found itself seriously embarrassed, a situation which was rendered more precarious by a decrease, due to the war, in the product of duties, and by a sudden suspension of specie payments by the banks throughout the country, which was followed by all the evils of a variable currency. A special session of congress was called, and further loans authorized; the annual direct tax was doubled, and its operation extended to the District of Columbia; the duties on carriages, auctions, licenses and the rates of postage were increased; new taxes were imposed, and for the first time in the history of the nation taxes were laid upon domestic manufactures other than spirits, snuff and sugar. Specific taxes were laid on iron and candles; and ad valorem taxes on hats and caps, umbrellas, playing cards, leather and plate, beer, ale, harness and boots. Household furniture was taxed according to its value, and gold and silver watches paid duties. The necessity of the treasury being pressing, a loan was raised on the pledge of the direct tax and the excises on distilled spirits. With the return of peace steps were at once taken to revise the existing taxes. In 1821 the estimated deficiency, due in great part to unliquidated war claims, was only $3,500,000; and as the revenues were $4,000,000 in excess of the requirements of the government in a time of peace, it was thought that the country should not be burdened any longer than was absolutely necessary with war taxes. In 1816 the direct tax was reduced one-half, and in the following year every internal tax was repealed. From 1818 to 1861 no direct tax of any kind, duties of excise, or other internal tax, was in operation in the United States. Though it was at times proposed to lay such taxes, it was never actually done, and whatever resources were required were obtained by modifying the tariff, customs and land sales forming the permanent sources of revenue. —Not until 1861 was an elaborate system of internal revenue imposed upon the country, for the two attempts we have just described were remarkably simple and included few articles. And again was a recourse to internal taxes an outcome of necessity, and was regarded as a temporary measure. With the outbreak of the rebellion, and the various expedients then taken to raise the necessary revenues, we enter upon one of the most curious, vast and complex experiments in taxation ever attempted, and one so burdensome in its results as to afford a most striking proof of the wonderful elasticity and vigor of the national resources, because it caused no permanent injury to the productive capacity of the nation. An enormous debt was created in a very few years, and its creation was accompanied by heroic measures to extinguish it. Loans, customs and internal taxes were made use of to an extent hitherto unknown in this or any other country, and this too while the country was engaged in a long and exhausting war. Internal taxes had remained unused for nearly half a century, and were known to the people only by tradition; in the changed conditions of the country there was little in past experience that could serve as a guide, and there was no opportunity afforded to study the systems of other countries; there was no existing machinery for assessing and collecting such taxes; and finally, in the excited condition of public opinion it was uncertain how such a system, if imposed, would be endured by the people, for it was feared that such a measure would only alienate from their allegiance to the central government the people of some states up to that time loyal. The first movements were made cautiously and tentatively. Money was required to carry on the operations of government and to support the charges of the war, but it was a very delicate matter to decide in what manner this money should be raised, for never before had the country stood in need of such resources. In the first years of the war almost entire reliance was placed upon loans to supply extraordinary demands, and it was not until 1863 that internal taxes were recognized as an essential part of the settled revenue policy of the government. But even before that year it had been clearly seen that some great alternations in the sources of government revenue were required. Import duties were largely increased, heavy loans authorized, and the "act to provide increased revenue from imports, to pay the interest on the public debt" included sections which contained the germs of the present internal revenue system. It provided for an annual direct tax of $20,000,000, to be apportioned among the states—a tax which was assessed and collected only in the first year after the passage of the act—and also for a tax of 3 per cent. upon the excess of all incomes over $800. It is a curious fact that these provisions should have been attached to an act providing in its title for an increase of customs duties only, and it can only he explained by supposing that it was from doubt on the manner in which a direct tax or an income tax as separate measures would be received, or to avoid any disputes on the income tax, that being essentially a direct tax, and would, under the constitution, have to be apportioned among the states as there directed. However, this incongruous measure was passed, but its practical enforcement was postponed until the following year, and it was seriously expected to employ state machinery in its collection, in this way avoiding any contact between a tax collector of the national government and the tax payer. The demands of the government rapidly increased, and it was soon seen that no half measures would prove sufficient. The act known as the internal revenue law was passed July 1, 1862, which is a complete code of taxation, and one of the most extraordinary which any country has ever seen. Under this law was organized the bureau of internal revenue, and provision was made for the machinery necessary to collect the taxes imposed by the act. To show the general scope of this law, it may be stated that it provided for taxation upon trades and occupations; upon sales, gross receipts and dividends; upon incomes of individuals, firms and corporations; taxes upon specific articles not consumed in the use; stamp duties; taxes upon various classes of manufactures; as well as taxation upon legacies, distributive shares and successions. —The extent to which taxation was carried under this and subsequent acts can not be better expressed than by the words of Sydney Smith written forty years before. "Taxes upon every article which enters into the mouth, or covers the back, or is placed under the foot; taxes upon everything that is pleasant to see, hear, feel, smell, or taste; taxes upon warmth, light and locomotion; taxes on everything on earth, and the waters under the earth; on everything that comes from abroad, or is grown at home, taxes on raw material; taxes on every fresh value that is added to it by the industry of man; taxes on the sauce which pampers man's appetite, and the drug which restores him to health; on the ermine which decorates the judge, and the rope which hangs the criminal; on the poor man's salt, and the rich man's spice; on the brass nails of the coffin, and the ribands of the bride: at bed or board, couchant and levant, we must pay." This is no exaggeration of the system imposed by the act of 1862. —In other countries the systems of excises and internal taxes have usually been the product of long experience, and have been frequently modified so as to be adapted to the economic condition of the country, its population and material prosperity. Being moreover of slow growth and of long standing, and, generally speaking, subject not to violent alteration but to gradual modification, they fall more equally upon the people, and are less burdensome than would be an entirely new system, ill-adapted to the condition of the people, and subject to frequent and violent alterations. For time is required to allow the conditions of an industry or occupation to adapt themselves to a tax; and in time it is the tendency of a tax to diffuse itself, and to bear with less weight upon the commodity or person primarily taxed. But at the time of the passage of the internal revenue law the necessities of the government were so pressing that no regard was paid to any of the principles of taxation, to the experience of other nations, or to the conditions of trade and industry and their consequent ability to bear a tax; and there is no knowledge of economic doctrines displayed in the debates in congress upon this and subsequent measures. The country, from being very lightly taxed, passed at once under a system of excessive and burdensome taxation. Processes were taxed as well as products of industry, taxes were laid upon all labor, upon all tools by which work was to be done, and upon all classes and conditions of men. Every branch of trade and industry, every kind of manufacture, raw materials and net results, alike bore the burden of taxation. "No other nation," said the London "Economist," "would have endured a system of excise duties so searching, so effective, so troublesome." System there was none. "The one necessity of the situation," writes Mr. Wells, "was revenue, and to obtain it speedily and in large amounts through taxation, the only principle recognized—if it can be called a principle—was akin to that recommended to the traditionary Irishman on his visit to Donnybrook Fair, 'wherever you see a head, hit it.' Wherever you find an article, a product, a trade, a profession, or a source of income, tax it!" —A system of taxation so comprehensive and minute in its details, in which the exemption of any article from taxation was the exception rather than the rule, imposed with so little thought and discrimination, was naturally found to be unsuitable in many particulars to its purpose, and was subject to frequent alterations and modifications. At least one revenue bill was passed at every session of congress, and within the period 1861-7 more than twenty-five such bills became laws. The pendency of such a measure furnished frequent opportunities for numerous amendments, some of them not important in themselves, but by changing the language, rendered valueless many precedents and regulations of the bureau and well-considered decisions of the courts. For the first years after the passage of the internal revenue law the action of congress was directed to its increase, and new objects of taxation and additional sources of revenue were sought for; and not until the close of the war was there any movement looking to its decrease. —These many changes in the internal revenue laws naturally produced great uncertainty in their application, and consequent injury to trade and industry, confusion in the revenues, and inequality of taxation, for an uncertain or arbitrary tax is an unequal tax. So that it was impossible to estimate with even a near approach to truth what these taxes would yield. Nor was there any stock of economic knowledge or accumulated experience to assist in framing such estimates. And in support of this statement the following incident may be noted. Secretary Chase, in his report for 1863, states that, with a view of determining his resources, he employed a very competent person, with the aid of practical men, to estimate the probable amount of revenue to be derived from each department of internal taxation for the previous year (1862). The estimate arrived at was $85,000,000, but the actual receipts were only $37,000,000. —Among the effects of the practical application of this law may be mentioned the following: 1. Many industries found themselves too heavily burdened by the taxes imposed upon them, and were forced to choose between the alternative of producing at a loss, or of ceasing to produce. While the instances are few in which trades were actually taxed out of existence (for an example see article DISTILLED SPIRITS in this work), yet owing to the effects of the war, and the alterations in customs duties and internal taxes, the conditions of production were disturbed, and every branch of trade and industry was to some extent affected. In many branches there was a forced reduction in the production of from 30 to 75 per cent. One of the first recommendations of the revenue commission in 1866 was to entirely exempt the manufacturing industry of the United States from all direct taxation (distilled and fermented liquors, tobacco and possibly a few other articles, excepted). 2. Duplication of taxes. In imposing a general excise tax upon all manufactures, it necessarily entailed a system of duplication of taxes, for the finished product of one manufacture is the raw material of another, and is almost always itself an aggregate of several distinct and separate manufacturing processes. Some examples of this duplication of taxes may be cited. "It was formerly the practice of umbrella makers to manufacture the main constituents of their product as one business; but now the business of an umbrella manufacturer is rather to assemble the various constituents of an umbrella or parasol, which are made separately, and in different parts of the country. Thus, for example, the sticks, when of wood, are made in Philadelphia and in Connecticut, part of native and part of foreign wood, on which last a duty may have been paid. If the supporting rod is of iron or steel, it is the product of still another establishment. In like manner the handles of carved wood, bone or ivory, the brass runners, the tips, the elastic band, the rubber of which the band is composed, the silk tassels, the buttons, and the cover of silk gingham or alpaca, are all distinct products of manufacture; and each of these constituents, if of domestic production, pays a tax, when sold, of 6 per cent. ad valorem, or its equivalent. The umbrella manufacturer now aggregates all these constituent parts, previously taxed, into a finished product, and then pays 6 per cent. on the whole." And another example is found in the manufacture of books. Every separate item which entered into this manufacture—paper, cloth, boards, glue, thread, gold leaf, leather, and type material—paid from 3 to 6 per cent. in the first instance, and then 5 per cent. on the whole combined; and this not on the cost, but on the selling price. So that the finished book, and its constituent materials paid from twelve to fifteen distinct taxes before they reached the reader. This recalls what was said of Amsterdam, that in that city a dish of fish with its sauce, before it was served up to the table, paid excise "thirty several times." 3. As every tax is so much added to the cost of production, the cost to the consumer was greatly enhanced by this load of taxation, and to this is in part due the great rise in prices; for the government actually levied and collected from 8 to 15, and in some instances as much as 20, per cent., on the finished industrial product. 4. The frequent changes in the taxes created a spirit of speculation, and rendered uncertain the revenue from those sources to which these changes applied. On July 1, 1864, when the advance in the tax on distilled spirits, of from sixty cents to one dollar and fifty cents per gallon, took effect, there were in store, in anticipation of this advance, at least forty millions of gallons, or a quantity that was believed to be sufficient to supply the wants of the country for at least a year in advance. From July 1, 1864, to the time of the first report of the commission, the receipts of the government from distilled spirits were, from this cause, necessarily inconsiderable. Of cigars, in like manner, it was estimated that from seventy to eighty millions were manufactured and stored in the city of New York alone, in anticipation of the tax, while in the case of the insignificant article of matches, on which the tax was only one cent per bunch, the stock accumulated in anticipation of the tax was so large that it had not been entirely exhausted by January, 1866. So that from August, 1864, the date at which the match stamp tax was introduced, to January, 1866, the government failed to derive its legitimate revenue from that source. These variations in the taxes and their effects upon production, naturally disturbed and rendered uncertain the amount of revenue to be derived from each particular source. This will be made clear by a reference to the following table, which shows the collections in the same month for three years, the differences being caused by alterations in the tax law:  The table shows how uneven the production of taxable articles was; of some the production was stimulated, while of others it was retarded or perhaps altogether destroyed. 5. The vast system of internal revenue was imposed without reference to the existing tariff, or to the conditions imposed by the treaty of reciprocity with Canada, which was to expire in 1866. There was no equalization or adjustment between the tariff and internal taxes, and this resulted in frequent discriminations against the American producer and in favor of his foreign competitor. "In the case of the umbrella manufacture, the cover, as a constituent element of construction, represents from one-half to two-thirds the entire cost of the finished article. The silk, the alpaca, and the Scotch gingham, of which the covers are made, are all imported; the former paying a duty of 60 per cent., and the latter two about 50 per cent. ad valorem. The manufactured umbrella, covered with the same material, whose constituent parts are not taxed, either on the material used in their fabrication or on their sale, is, however, admitted under the present [1865] tariff at a duty of 35 per cent. ad valorem, or at a discriminating duty, against the American and in favor of the foreign producer, of from 15 to 25 per cent. If we make allowance for the various United States internal revenue taxes, it is claimed by the American manufacturers that the discrimination in favor of the foreign producer is fully equal to 40 per cent." Other examples could readily be given. Under the reciprocity treaty the products of American industry subject to high rates of excise were injuriously brought into competition with similar products of provincial industry, which were subjected to little or no excise, and then admitted into the United States free of duty. —In treating of the effects produced by the actual operation of this measure, no attempt has been made to maintain a chronological order, for in some cases the ultimate effects of a tax would not appear until the lapse of a certain length of time. —Yet owing to the enthusiasm and patriotism of the people this system was cheerfully welcomed and endured by them, and was successful in its main object. The revenues collected under it have never since been equaled, and judged from this standpoint it was most effective. Yet a more burdensome and diffuse system could hardly have been framed, as a simple calculation will show. In an early report Secretary Chase estimated that the internal revenue system would produce $50,000,000, and he thought that this sum was equal to about one-sixth of the surplus earnings of the country. In 1869 the special commissioner of the revenue made an extensive examination of the wealth and resources of the country, and was led to the conclusion that the annual increase of active capital in the United States, arising from the excess of production over expenditure, could not at that time be considered as in excess of 8 per cent. of the gross annual product, or $546,000,000 per annum. The collections from internal taxes, which were in 1863 but $43,000,000, rose rapidly to $117,000,000 in 1864, $211,000,000 in 1865, and culminated in 1866 with the enormous sum of $310,000,000; this last sum being equal to nearly 57 per cent. of the actual annual surplus wealth of the nation. Yet a large portion of the taxable property in this country escaped its proper charges through fraud or an imperfect administration of the laws. Under a perfect administration the revenues would have been much greater; for at that time the sources of national revenue were commensurate and co-extensive with every department or subdepartment of trade or industry in the country, as well as every form of fixed or circulating capital. For the purpose of placing in a clear light the burden of taxation, attention may be called to the following table, which shows the amount per capita, collected by various forms of direct and indirect taxation in the United States for 1865-6, and in several of the leading states of Europe for the year 1865, (the revenues from the public or crown lands, postoffice receipts, and colonial subsidies, being excluded from the estimate); also the amount of the public debt in the same countries per capita:  Nor, generally speaking, were manufactures at all depressed by this enormous burden of taxation. On the contrary, owing to the demand for most manufactured and agricultural products, and the great rise in the prices of commodities, the profits of the producer were actually enhanced by reason of the taxes to an extent considerably greater than they would have been had no taxes whatever been collected. Thus, in the case of distilled spirits, the advances in the tax were foreseen, and large quantities were manufactured before the increased tax took effect, in order to be sold at the higher price which followed the imposition of a higher tax. "In the case of raw cotton, which advanced mainly through conditions affecting its production or distribution, it was shown by actual calculation, in respect to one manufacturing corporation in New England, that if they had at the commencement of the war burnt their mills, lost their insurance, and sunk their capital, other than what was invested in cotton, and had subsequently sold their cotton at the highest prices obtainable, in place of manufacturing it, the result would have afforded to the stockholders a permanent annuity of at least 12 per cent. on their original investments." —Mr. Mill admits that a tax upon profits may give a stimulus to inventions, and the use of them when made. This may produce a cheapening in the products of manufactures and so raise profits to such an extent as to make up for all that is taken from them by the tax. This seems to have been the condition of the United States, for it is known that few industries were permanently injured by the taxes, so great are the natural advantages and productive capacity of the country. The rapid increase of population, the great progress of agriculture and manufactures (though accompanied by no corresponding increase of commerce), and the large number of expensive undertakings entered upon with a return of peace, showed beyond question the resources of the country. In fact, the conclusion of Mr. J. R. M'Culloch in regard to the continental wars, 1775-1812, might almost be accepted as applicable to the condition of affairs at that time: "An increase of taxation has the same influence over nations that an increase of their families or of their unavoidable expenses has over individuals. The constantly increasing pressure of taxation during the American war, and the war begun in 1793, was felt by all classes, and gave a spur to industry, enterprise and invention, and generated a spirit of economy, which we should have in vain attempted to excite by any less powerful means. * * Man is not influenced solely by hope; he is also powerfully influenced by fear. Taxation brings the latter principle into the field." —We have no more space for examining further into this most interesting chapter of the financial experience of this country, nor can we trace its ultimate effects upon prices, upon production and consumption, and upon foreign commerce. With the close of the war a reduction in taxation was demanded by the people, and was soon effected. Between Sept. 1, 1865, and July 1, 1869, taxes yielding, in the aggregate, upward of $200,000,000 per annum were abated or relinquished, chiefly on the recommendations of the revenue commissioner. When Mr. Fessenden assumed the office of secretary of the treasury in 1864, recognizing the incongruity and burdensome nature of the tax system, one of his first recommendations to congress was the formation of a commission to inquire into the most profitable sources of revenue, and to devise improvements in the modes of its collection; but his recommendation was not at that time adopted. In his annual report for that year he again returned to the subject, and in March, 1865, such a commission was appointed, and included David A. Wells, Stephen Colwell and S. S. Hayes. The creation of this commission was the first practical movement toward a careful examination of the business and resources of the country, with a view to the adoption of a judicious revenue system. The commission made a report in 1865-6, and as it showed how necessary such an examination had become, in 1866 the office of special commissioner of the revenue was created, to continue the labors of the commission, and Mr. David A. Wells was appointed to the office. It is in the reports of this able economist that we find the best and most thorough examination of the revenue system of the government, and we have depended chiefly upon them for our information on the practical effects of the act of 1862. The office was discontinued in 1870. —Large reductions were made by the statutes of July 13 1866, ($63,000,000); March 2, 1867, ($40,000,000). Feb. 3, 1868, ($23,000,000); and March 31, and July 20, 1868. Under the act of March, 1868, which took off taxes from all manufactures of the country other than distilled spirits, fermented liquors and tobacco, no reduction in the prices of commodities followed, as would naturally be looked for. As it was an unexpected measure, it was thought to be but a temporary measure, to be soon replaced by other taxes; so that producers made no reduction in their prices. Many of the taxes had become unproductive, and hardly figured in the returns; for in 1869 upward of 90 per cent. of the internal revenue was collected from a few objects and sources, all of which might be classed as luxuries, or as the accumulated wealth of the country. The act of June, 1872, made important reductions by repealing the taxes on incomes, and gas, and abolishing all stamp taxes under schedule B (1864) except that of two cents on bank checks, drafts or orders. —The effect of this great reduction of taxation, accomplished in so short a period and with as little discrimination as was used in imposing these taxes, must have had some effect upon the industries of the country which had accommodated themselves to the burdens imposed upon them, though it would be difficult to determine to how great an extent they were injured or benefited. The theory has been advanced by a competent authority, Mr. Abram S. Hewitt, that the revulsion of 1873 was in great part due to this reduction of taxes. This could, however, have been but one out of many causes, and it would be a mistake to insist too strongly upon this as an active cause. —The sources of internal revenue were now nearly reduced to what they are at the present day; so that a large number of intermediate measures, either reducing or abolishing taxes, regulating the machinery of collection, or providing against fraud, may be passed by. Nor need anything be said of the system of informers and spies, or of the great frauds perpetrated upon the government. —The receipts for the fiscal year ending June 30, 1881, under internal revenue laws, were drawn from the following sources:
Thus it may easily be seen that the most objectionable features of the system have been gradually removed, and the taxes now included in it are such as weigh but lightly on the industry of the country, and for the most part fall ultimately upon those who of their own free will pay them. But as the revenues of the government are at the present time far in excess of its legitimate needs, justice and public policy alike demand a still further reduction. The stamp tax on matches, though small in amount and easily collected, is a very unequal tax, and on that ground should be condemned; the tax upon bankers and banks might be reduced or repealed, for the circumstances that existed when the tax was first imposed, and which rendered it a comparatively light tax, have changed, and it is claimed that the tax has now become very burdensome. In fact, the internal revenue taxes could be reduced to those on spirits, tobacco and fermented liquors, and the rates on these commodities could even be reduced. But no other changes could be defended on grounds of public policy or of sound economy. The cost of collection was for the year 1881 but 3.64 per cent. upon the amount collected. —Yet a movement looking toward the repeal of the whole system of internal taxation has found great favor among the leaders of the protectionist party, for it would of necessity require a continuance of the present tariff. It is difficult to speak of such a proposition with any moderation. The objections that were urged against internal taxes in the last century will not apply at the present time, for the country is well advanced in wealth and material prosperity, and can easily bear such taxation. Moreover, as we have said, the present system of internal taxes falls, with some exceptions, only upon such articles of voluntary consumption as may be dispensed with and may be taken in excess, and therefore fulfills in the highest degree the requirements of just taxation. While valid objections may be urged against the stamp taxes and those on bankers and banks, no reason that will bear examination can be found for taking off the excises on tobacco and distilled spirits. To maintain that these last named taxes fall chiefly upon the poor affords no sound plea for their repeal. That the necessaries of life consumed by the poor should remain untaxed, is in accordance with the demands of humanity and sound economic doctrine, and on this ground the tariff needs revision. But when a man spends a part of his income on indulgences, as spirits and tobacco confessedly are, it is fit and proper that he be taxed; for the lower strata of society escape most other forms of taxation, and it is through indirect taxes alone that they may be reached and made to pay their quota to the expenses of the state; and there is no more just method of doing this than by taxes on their indulgences. In fact, the objections urged against the internal revenue system of the country are rather of a sentimental character, and are not based upon a careful survey of the resources of the country, the incidence of taxation, and the most fitting objects of taxation; and the various schemes looking to "free whisky and free tobacco" belong more to the doctrines of demagogues than to the principles of true statesmanship. They are vulgar appeals to the uneducated masses who do not know their own interests, and are thus misled into indorsing a scheme that will only serve to fasten upon the country a system of taxation by customs duties that is far more onerous and inequitable, and therefore more indefeasible, than the taxes now imposed as internal taxes. —Following we give a table of receipts of the United States from internal revenue from March 4, 1792, to June 30, 1881, (by calendar years to 1843, and by fiscal years from that time):
In the intermediate years some outstanding amounts were collected, but they are not of sufficient importance to be given in this place. The total amount derived from internal revenue since the formation of the government is $2,807,357,366.28. —AUTHORITIES. Reports of the Secretary of the Treasury and the Commissioner of Internal Revenue; Report of the Revenue Commission and of the Special Commissioner of the Revenue, David A. Wells, in the Cobden Club Essays; and also his article on DISTILLED SPIRITS in this work. Compilations of the revenue laws have from time to time been issued by the government. A great mass of information is contained in the Internal Revenue Record. (See EXCISE, INCOME TAX, STAMP TAX.) WORTHINGTON C. FORD. INTERNATIONALINTERNATIONAL, The, or the International Association of Workingmen. This too notorious association owed its origin to the relations which were established at the time of the universal exposition at London, in 1862, between the socialistic French workmen who were sent there at the expense of the government and the English workmen belonging to the trades unions. Up to this time continental socialism had scarcely descended to the ground of realities. It had contented itself with making plans for the organization of labor, of which the essential feature was the substitution of association for wages and the subordination of capital to labor. But in 1862 the contact of the French socialists with the English unionists gave the former an opportunity to become acquainted with the organization and powers of the trades unions, and they determined to import these powerful machines to the continent, and press them into the service of their theories, that is to say, employ them systematically in the war against capital. It was at a meeting in favor of Poland held at St. Martin's Hall, Sept. 28, 1864, that the foundations of the international were laid. A provisional rule was adopted, appointing a committee to draw up the laws of the association, and to summon the affiliated societies to a congress, by which these laws should be definitively adopted. A preamble, purposely expressed in terms rather vague, so that they might be accepted by the different socialistic sects, was placed at the head of the provisional rule and afterward at the head of the laws. In this it was particularly stated "that the subjection of labor to capital is the source of all moral, political and material slavery; that on this account the economic emancipation of the working class is the great end to which all political movement should be subordinated; that thus far all efforts in this direction have failed for want of thorough co-operation among the workmen of different trades in each country, and of fraternal union among the workingmen in different countries," etc., etc. The conclusion was, that the workmen of all nations ought to unite, taking "for the basis of their conduct toward all men, truth, justice and morality, without distinction of color, faith or nationality." The terms of this programme were sufficiently general and elastic to exclude no one; however the association was slow in forming, though the annual assessment had been fixed at one shilling; still, a bureau was established in Paris, rue des Gravilliers, where the first group of internationalists assembled; but, according to the testimony of Mr. Fribourg, "from the outset of the enterprise money was lacking." This was the case also in London. "But for the proceeds of a family tea, with a concert, lecture and ball, which the English members gave to the London public, the want of money would, perhaps, have prevented the work from taking root in England for a long time." (L'Association international des travailleurs, by E. E. Fribourg, p. 23.) It was not until Sept. 3, 1866, that the nascent association held its first congress at Geneva, under the presidency of Yung, a member and delegate of the central committee of London. The number of delegates from the sections already formed or in process of formation in France, Germany, England, Switzerland, Spain and Italy was about sixty. The congress first adopted the manifesto and by-laws of the association which a committee had been ordered to prepare, and then discussed a certain number of social and political questions which were made the order of the day. In the following years the association held three other congresses, one at Lausanne in 1867, at Brussels in 1868, and at Bâsle in 1869. The events which followed compelled it to suspend these international reunions, and they were not resumed until September, 1872, at the Hague, where a division took place, following which an opposition congress was held at London. —The by-laws adopted by the congress at Geneva consisted of eleven articles, with regulations in the form of an annex containing fifteen articles. The first article of the by-laws was as follows: "This association is established to provide a central point of communication and co-operation for the workingmen of different countries seeking the same end, namely, the mutual co-operation, progress and complete enfranchisement of the working class." The succeeding articles treat of the "general council" which was to be composed of workingmen of different nations. Each year the congress or general assembly of the delegates of the association was to elect the members of the council and determine where the council should sit. As a matter of fact it always met in London. The general council was not invested with any authority over the association, its duty was simply to establish relations among the workingmen's associations of different countries, and endeavor to increase the sections of the association; these associations or sections, however, preserving their autonomy. Each section, whether large or small, had the right to send a delegate to the congress, and when it reached 500 members, one delegate more for such number. Each section or federation of sections managed its own affairs, fixed the amount of its assessments, and disposed of them as it saw fit. Nevertheless, a general assessment was levied upon all the members of the sections or affiliated societies for the benefit of the general council; but this assessment was very small: ten centimes per capita each year. The total of these receipts for the year 1866, presented at the congress at Lausanne, did not exceed sixty-three pounds sterling, and it is doubtful whether it was much higher in the following years. In this respect the writers who have occupied themselves with the international have fallen into very serious exaggerations. For lack of resources the "general council" was compelled to give up the publication of a bulletin of international statistics which was to have furnished the societies affiliated to the international with regular information as to the state of the labor market, the rate of wages, etc., and it was not able even to maintain a special organ. The Belgian, Swiss and other sections had their journals, such as the Egalité of Geneva, the Mirabeau, of Verviers; but the general council had none. In short, the international association formed a vast federation of "sovereign sections," of which the general council was the bond of union, but without exercising any effective authority over them. The regulations annexed to the by-laws were intended to render it entirely subordinate to the congress or general assembly of the delegates of the sections which it was commissioned to organize, and whose resolutions it was obliged to execute, (art. 1), with this express stipulation, that the congress should assemble freely, without special convocation, at the times and places which had been fixed upon the preceding year. It is easy to recognize here the spirit of jealousy and defiance of all authority which has always characterized democracy. —Thus constituted, the association had before it, from the beginning, a double end: one purely theoretic, which consisted in discussing, in its congresses, its journals and its special publications, all questions of interest to the working class, and fusing together, if possible, the different socialistic doctrines; the other object, of a practical character, consisted in multiplying its sections so as to include within its pale, in time, all the working masses, thus forming an innumerable army, acting principally by means of coalitions and strikes, for the overthrow of capital. At each congress a great number of "questions" were submitted to the sections, among which, as in most other congresses, the work to be done was divided. Those which were discussed were made the subject of a report which was further debated in the general assembly. Finally, they voted on "resolutions" summing up the opinion of the majority on these questions. Among the subjects which gave rise to the most important discussions may be mentioned property in general, landed property, property in railroads and mines, the laws of inheritance, interest on capital and mutual credit, machines, the reduction of the hours of labor, strikes and societies for resistance, co-operation, education and war. It is needless to say that opinions hostile to property predominated. Thus at Bâsle, in 1869, the congress declared by a vote within four of being unanimous, "that society has the right to abolish individual property in the land, and restore the land to the community." But, by a singular inconsistency, in the same congress, the abolition of the right of inheritance did not receive the necessary majority, (32 of the delegates voting for the abolition, 23 against it, and 17 not voting at all). On the other hand, there was almost perfect unanimity for restoring railroads, mines and forests to the domain of the community, and organizing mutual credit for the purpose of suppressing interest and "releasing labor from the domination of capital by restoring the latter to its natural and legitimate rôle, which is that of the agent of labor." (Resolutions of the congress of Brussels, 1868.) The co operative societies which retained interest were condemned as "transferring that egoism which is the bane of modern society from the individual to the community." As to strikes, while declaring "that strikes are not a means to the complete freeing of workingmen, the association was of opinion that they might be considered as a necessity in the actual situation," and that it was desirable to multiply societies for resistance in order to sustain them. In regard to the introduction of machinery, the association was of opinion that it ought not to take place without guarantees and compensation to the workmen. It finally pronounced for the legal limitation of the hours of labor, and the establishment of "complete education." Very energetic and radical resolutions against war were voted in each congress. As to the future political constitution of society we note the following resolution adopted at the congress of Bâsle: "The groups (trades unions) will constitute the commune of the future, and government will be replaced by councils of bodies of tradesmen." However, there was a difference of opinion as to whether the international ought to occupy itself with purely political questions; in 1869 the question was decided in the affirmative. The congress of the friends of peace, composed of a group of republicans, met at Lausanne, while the congress of the international was sitting at Bâsle. The two congresses, between which could be perceived the old antagonism of politicians or Jacobins and socialists, made peace, under the auspices of M. Victor Hugo, who proclaimed "the union of the republic and socialism." —To sum up, although the economic and political doctrines represented by the international present singular inconsistencies, they were generally agreed on these different points, to wit, that there must be a breaking up of existing society; a transforming of property or its suppression; the abolition of wages by transferring existing enterprises to the hands of associations or companies of workingmen, in which work alone would be remunerated, capital, for the future, furnishing its services gratis; and finally, that the government should be only a sort of delegation of the federated communities of workingmen. Such were the doctrines that the international strove to popularize and finally to realize. As to the way in which they were to be realized, opinions differed: some favored political means, otherwise called revolutionary; others favored the economic procedure of strikes. While the British trades unions regarded coalitions and strikes simply as a means of raising wages or shortening the hours of labor, the international saw in them a power destined to make the war against capital general and finally to bring under subjection that tyrant of labor. With this object, the international strove to extend its thread of local sections and federations over the entire civilized world; the general council, which served as a medium of communication, was to enable them to render each other mutual aid, so that each strike, if regarded as opportune, should be sustained by subsidies from all the sections or federations. Thus was created an instrument which in time might acquire irresistible power, and the international would end, at least so it flattered itself, by controlling the labor market and dictating the conditions of wages to capitalist employers. If it found them too hard, its intention was to purchase their enterprises and hand them over to associations or communities of workingmen, and thus put an end to the odious régime of wages and the tyranny of capital. This is why from 1867 the international took a part more or less direct in numerous strikes in France, Belgium and Switzerland. We read, for example, in the report on strikes presented to the council of Brussels, in 1868, by César de Paepe, that "the house builders in Geneva saw their strike succeed because the workingmen of France, Italy, England and Germany came to their aid. The sections of the international organized a vast subscription, and the bureau of Paris alone procured the sum of 10,000 francs." Besides the assistance collected usually by way of subscriptions in the sections, the international undertook to transmit all the advice and information which might aid the cause of the strikers. Thus, during another strike of the same house builders at Geneva, the journals of the international induced masons, stonecutters, etc., to refrain from going to Geneva until further orders. At Lyons, the strike of the female silk spinners (June, 1869) was encouraged by the international, which sent them a small sum of money (1,323 fr. 30 c.) collected from the sections. (Oscar Testut, L' Internationale, p. 72.) At Paris, the strike of the leather-dressers and bronzers was sustained by similar support. The bronzers, an exception which Mr. Fribourg points out, afterward paid it back. The international interfered in an equally active manner, in the strikes at Creuzot and Fourchambault (April, 1870), in the strike at Seraing (Belgium), etc., etc. But, following the example of the trades unions, it interfered only when the circumstances seemed favorable. In the strike at Renaix, it even attempted to exert a pacifying influence. A proclamation from the bureau of Paris, signed by Messrs. Tolsin, Fribourg and Varlin, condemned the destruction of machinery. But the international did not often hold such moderate language; the workmen themselves have accused it, at different times, of having encouraged strikes without giving them any assistance beyond proclamations and the exhortations of its agents. However, it acquired such an influence that the imperial government, after trying to negotiate with it, became alarmed. The bureau of Paris had to stand three law suits, (March and May, 1868, and July, 1870), several members of the bureau were condemned, first to pay a small fine, afterward to a year in prison. These sentences do not seem to have arrested the progress of the international. The events of 1870 exercised a decisive influence over the destinies of the international. It is only justice to it to say that at first it protested vigorously against the war. In this spirit, the Parisian members published a "manifesto to the workingmen of all countries." On the 23d of July the general council published a similar manifesto. "We declare if the working classes of Germany permit the present war to lose its strictly defensive character and degenerate into an offensive war against the French people, victory or defeat will be equally disastrous" According to Mr. Fribourg, the international, as a corporate body, took little part in the revolution of September 4th; nor do we find it much more active in the defense of Paris. (L' Internationale, p. 143.) At this time the place of its meetings had been transferred to rue de la Corderie-du-Temple, and in the room of the Cour-des-Miracles, near the passage of the Caire, its members had a club, very meagrely attended (club of the Cour-des-Miracles). The international gave few signs of life until the eve of the commune. What part did it take in the insurrection of the 18th of March? It is difficult to say. Only two of its members, Varlin and Avoine fils, figured among the thirty-six members who composed the "central committee of the national guard." On the other hand, among the seventy-nine members of the commune, twenty belonged to the international; a few, Ch. Beslay, Theisz and Longuet, were among the moderates; others, on the contrary, such as Vésinier, Pindy and Varlin, figured among the promoters of violent resolutions and measures. On the 23d of March, a circular emanating from the "federal council of the provisional sections," and from the "federal chamber of the workingmen's societies," urged the people of Paris to vote for the commune, which was to be elected three days later (March 26th). This is the only thing emanating from the association which we find in the collection of documents of this epoch. (Le Gouvernement du 4 Septembre et la Commune de Paris, by Émile Andréoli, p. 215.) But immediately after the repression of the insurrection (May 30, 1871), the general council at London published a long manifesto addressed "to all the members of the association in Europe and the United States," in which the insurrection of the 18th of March was justified and the commune glorified. (This document will be found in the Histoire de l' Internationale, by Edmond Vélletard, appendix, p. 327.) —A general outcry was then raised against the international, and there was even a question of a convention between governments to prohibit it. This project did not amount to anything, but in France a law was passed, under date of March 14, 1872, forbidding, under heavy penalties, all affiliation with the international, and even the giving publicity to its documents. Whether the international thought it prudent to let the storm pass over, or whether it was weakened by the internal dissensions which broke out a little later, little was heard of it for more than a year. The congress did not assemble in 1871; there was only at London a simple "conference" whose deliberations were not made public. The following year the general council of London, of which the celebrated socialist, Karl Maix, had been made president, took courage and convened a congress at the Hague. But in the meantime the centralizing tendencies of the general council had roused intense opposition, and Karl Marx was accused of aspiring to the dictatorship. On the eve of the congress at the Hague, Aug. 4, 1872, at the congress at Rimini, the Italian federation formally broke with the general council. On the other side, the Jura federation sent a delegate, Guillaume, to the Hague, expressly commissioned to demand "the abolition of the general council and the suppression of all authority in the international." This burning question was made the order of the day at the opening of the congress, and called forth the most stormy debates. —Thanks to the gathering of a certain number of the old members of the commune, Ranvier. Dereure, Vaillant, etc., the majority pronounced in favor of maintaining the general council. The federalist minority then withdrew from the congress. But it was not long before the majority was itself divided; it embraced two very distinct elements: those who wished to confine themselves to the economic struggle, at the head of whom was Karl Marx; and those who demanded that the international should take upon itself, in the first place, to organize the proletariat as a political party. The old members of the commune, who formed the party called the "Blanquists," especially sustained this opinion; but Karl Marx and his friends refusing to agree to it, the politicians, in turn, quitted the congress, thus leaving the field open to the partisans of the economic struggle. The latter resolved to transfer the seat of the general council from London to New York, and after taking this resolution, the congress adjourned. Some days later, on the 15th of September, the dissenters, to the number of twenty-five, assembled in the Science Hall, Old street, London, to protest against the decisions of the congress of the Hague, accusing that congress of having "compromised and betrayed" the cause of the international. This opposition congress, led by the two communists, Vésinier and Landeck, pronounced the dissolution of the international, and decided that it should be replaced by a "universal federal association." —The history of the international ends here. Created under the influence of the false idea which has been at the bottom of all socialistic ideas for the last half century, that labor is necessarily defrauded (exploité) by capital under the wages system, the object of the international was to suppress wages and substitute associations in which capital would be subordinate to labor for the existing enterprises of production and exchange. To attain this end, it employed sometimes the novel mode of procedure of the trades unions whose forms of organization it had borrowed, and sometimes the old revolutionary methods. Neither of them has succeeded, and it may be hoped that the association will never recover from the blow dealt it by the dark events of 1870-71; but it is less certain that it will not have successors. G. DE MOLINARI. INTERNATIONAL LAWINTERNATIONAL LAW. (See LAW, INTERNATIONAL.) INTERPELLATIONINTERPELLATION, a question propounded to a minister by a member of parliament. Many arguments can be offered in favor of the right of interpellation, even setting aside those founded upon ministerial responsibility. Has not the nation a right to be informed about its own affairs, and can its mandatories exercise their control without asking for the information they may need? When the law does not allow deputies to interrogate the representatives of the government in a legislative assembly, it frequently happens that the questions arise of themselves, and the government immediately answers them. The government may even sometimes be glad of the opportunity thus presented of expressing its opinion. The solemn preparation of these questions only has been removed. Where the right of interpellation is admitted, in Europe, the ministers are informed of the subject of the interpellation, the day is fixed by mutual consent, and the government has an opportunity to prepare itself; but it is not always obliged to answer. The public good may sometimes require the refusal to grant interpellation. The government may also, it is true, pretend a necessity for silence, based upon this motive, and thus avoid a difficulty. MAURICE BLOCK. INTERREGNUMINTERREGNUM is the interval between one reign and another. In an hereditary monarchy the heir to the throne is king by right after the death of his predecessor; every one knows the expression: "The king is dead, long live the king." An interregnum can occur only in states where, at the end of one dynasty, the new prince succeeds only after a certain interval. —There is no interregnum in a republic, for the supreme magistrate is elective; he does not reign, but governs. The end of his government being known beforehand, the election of his successor can be held, and the one enters into office the moment the other departs from it. In this case, also, there is no break in the continuity. —It is not so in an elective monarchy. The king having been elected for life, the precise date of the end of his reign is not known, and it would not be pleasant to tell a man that you believe he will soon die. In these states, then, there is an interregnum, the time of election. The evils that result from these momentary removals of the representative of supreme authority, are well known. Thus at Rome, after the death of a king, the senate nominated a substitute for the performance of the religious functions that could not be performed by other magistrates. The wars of the pretenders which, in the Roman empire, followed the death of Galba, and of Didius Julianus, were veritable interregnums. In France we may cite the interregnum from 736 to 741, from the death of Thierry II. to the accession of Childeric III Charles Martel governed France during this period, as he had governed it under Thierry II., and as his son, Pepin the Short, governed it under the succeeding monarch. There was also an interregnum of one year between the death of Charlemagne and the accession of Charles the Simple; an interregnum of five months in 1316, from the death of Louis the Quarrelsome to the birth of John I, who reigned four days. The most celebrated in history was the great interregnum of the German empire, which lasted twenty-three years, from the death of Conrad IV. (1250) to the election of Rudolph of Hapsburg (1273). Three emperors were elected at the same time during this interval: William of Holland, Richard of England, and Alphonsus of Arragon. None of them reigned. It was a period of discord and violence. —The great improvement in political institutions has, in the different countries, either suppressed the royal power, or extended to the mode of transmitting it the increased regularity of all political movements. Thus the interregnums which were so terrible and so disastrous in ancient history, are accidents entirely foreign to the history of modern times. JACQUES DES BOISJOSLIN. INTERVENTIONINTERVENTION. By intervention, in politics, is meant the influence exercised by one or several governments over another or several other governments regarding internal or external affairs, of a nature to compromise the general peace. Taken in its etymological sense, the word intervention should signify arbitration; but as the duty of an arbiter supposes absolute disinterestedness on the part of the one who takes this character, the term certainly can never be rigorously applied in politics, for the interference of a nation in the affairs of a strange state rarely possesses and still more rarely preserves this noble character. Still, the principle on which the right of intervention is based, is theoretically the recognition of a human right, the affirmation of the unity of human reason, the attestation of the moral and material solidarity of all nations and all individuals, independent of and superior to the constitutions and particular laws that govern them. —Nil humani a me alienum puto: I esteem nothing human foreign to me; such is the profession of faith of every man of progress, no matter what his nationality. Surely, nothing can be nobler than this. In France the right to interfere in the internal and foreign debates of other countries is considered almost as of divine investiture, and this generous passion has often made the French forget even the care of their own independence. —Can it be said that there is a human law, fixed and invariable, accepted by all, and calculated to serve as a rule for all relations of people to the government, and of state to state? We need but cast a glance at contemporaneous events and recall the history of past times to recognize how far we still are from such a realization. However, the right of intervention is exercised every day, either openly or covertly, to the detriment of universal morality. It has served and may still serve as a pretext for every species of usurpation, iniquity and spoliation. Instead of preventing war, it most frequently leads to a general conflagration; from a circumscribed debate, colored with some show of justice, it leads to the most audacious attempts against the independence of nations and the liberty of individuals. —There are several kinds of intervention-intervention simply by means of notes called verbal, delivered by the ambassador of the intervening power; official intervention by notes publicly delivered; pacific intervention, which nearly always has for result a congress or international conference, and armed intervention, preceded by an ultimatum, accompanied by military demonstrations and followed by a declaration of war. —The principal authors who have treated of the law of nations have vainly endeavored to circumscribe the right of intervention, but they have not succeeded in giving a positive definition of it, or defining its limitations. Vattel, Wheaton, de Martens, Pinheiro Ferreira, admit that it should apply only to the purely external acts of nations, and that the circumstances in which a foreign government may intervene in the internal affairs of a state are very special and restricted; but these authors have taken care not to specify the particular cases in which intervention appears to them legitimate, and thus the way is left open to all interpretations. —Some modern publicists have professed the principle of non-intervention in opposition to the principle of intervention; endeavoring (so lacking in precision is political language) to give a positive value to a negation. Instead of considering in itself the right of nations to dispose of themselves, to form their institutions, to contract alliances, and to conclude treaties of commerce, they have reduced the declaration of independence of nations to this lamentable formula: Each one for himself, and at home. —In 1820 at the time of the meeting of the congress of Troppeau and Laybach, the English government endeavored to establish more definite limits to the exercise of the right of intervention: the question arose apropos of the Neapolitan nation, which, in the course of an uprising, had wrested from its sovereign certain guarantees against arbitrary power. The popular movement had been successful, the king abdicated in favor of the duke of Calabria, and granted a constitution. The emperors of Russia and Austria, and the king of Prussia, interested themselves in the matter, and convoked a congress of the powers that signed the treaty of 1815, to take counsel, in their common interest, as to the revocation of the concessions granted; England declined to attend, and her declaration deserves mention here, for it inaugurated the policy of non-intervention which secured to Europe so long a period of peace. —While acknowledging that a government might have the right to interfere seriously and directly in the affairs of another state, the English government deemed this right justifiable only by the most urgent necessity; it did not admit that this right could receive a general and unrestricted application in all cases of popular movements, and it believed especially that it should not be employed as a prudential measure, nor form the basis of an alliance. This right, it said, should be an exception to the most essential principles; it could be allowed only in special circumstances. The liberal attitude of England, at this period, is not to be attributed to a respect for the independence and autonomy of nations; policy proceeds from interest, more or less correctly understood, and not from principle. —The most curious result of the congress of Laybach, was the pretension (a pretension made by the intervening powers) to prevent a sovereign from granting, or, to speak more accurately, from restoring to his people the liberties which had been taken from them. Its decision was to the effect that the absolute principle should be re-established at Naples, that the former king should resume his crown, and that, if necessary, force should be employed to obtain this end. Austria was charged with the execution of the decree; her armies invaded the kingdom of the Two Sicilies, and during several years occupied, at the expense of that country, the principal cities of the kingdom. —One year later Piedmont rebelled, and proclaimed a constitution copied after the Spanish constitution of 1812. Again there was a new intervention, a condemnation of the insurrectionary action of the Piedmontese people, and a restoration of absolutism; and again it was Austria that had the honor of the repression. The allied governments thus justified their intervention: "It was a right which, in this special case, became an urgent necessity to unite in common measures of security against the states in which the overthrow of the government effected by revolt could be considered but as a dangerous example, which would result in an attitude hostile to legitimate constitutions and governments." —Two years passed, and Spain in turn demanded the constitution of 1812; this time France was the executor of the decrees of the holy alliance; her arms overthrew the national compact of Spain and restored absolutism beyond the Pyrenees. —Upon the revolt of the Spanish colonies, the desire to intervene was again manifested, but here the United States upheld the revolted provinces, and England declared herself ready to recognize the independent governments that had been formed, and the holy alliance was obliged to withdraw before the consequences of its own principle. —In 1825 the death of John VI. called to the throne of Portugal his eldest son, Dom Pedro, then emperor of Brazil. The constitution of the latter country being opposed to the reunion of the two crowns, Dom Pedro abdicated in favor of his eldest daughter, Donna Maria, who inaugurated her new reign by according a constitution to Portugal. A competitor arose to oppose her, under the auspices of the great powers. France supported Dom Miguel, but England declared openly for the constitutional power of Donna Maria, and disembarked a body of troops in Portugal; this effective intervention a second time foiled the retrograde action of the French, Russian and Austrian governments. —In 1826 a new coalition was formed, in which England participated in the intervention demanded by France and Russia in favor of the Greek insurrection. The united powers burned the Turkish fleet at Navarino. Fourteen years later, France intervened in favor of the Turkish government, and all Europe was prepared to take up-arms in defense of an empire which it had so terribly ill treated but a few years before. —Since 1848 interventions have followed one another pretty steadily: the intervention at Rome to re-establish the temporal power of the pope; the intervention in the Crimea to insure the integrity of the Turkish empire; the intervention in Italy for the re-establishment of Italian nationality; the intervention in Syria for the protection of the Christians of Libanus; the intervention in China and Cochin China, under pretext of suppressing acts of cruelty committed upon the missionaries, and in reality to enlarge the circle of the commercial relations of France and England; and French intervention in Mexico, the sad results of which are well known. —To sum up, intervention is war, and war is the subordination of civil to military genius, and as a talented author has very forcibly expressed it: "As dangers accumulate, war opens the era of saviours. Scipio makes us forget the Gracchi, and prepares the way for the Cæsars. The austerity of public morals gradually disappears before the corruption of ill-acquired riches; the glory of the great generals eclipses all social virtue. War is as disastrous to morals as to the public finances." It was in the name of the right of intervention that Catharine II. prepared the way for the division of Poland; it was by an appeal to the same right that Prussia and Austria sanctioned this usurpation by taking part in the spoliation of the Polish nation; it is under color of intervention that England even successively dispossessed the native princes of Hindostan. It was under the pretext of intervention that Brunswick addressed to revolutionary France the insulting manifesto to which she replied by so many victories. However, the French revolution was an entirely internal matter; when it broke out it had not the character of propagandism which it assumed later. We may say that the intervening powers violated the autonomy of nations, and that the principle of intervention which they wished to legitimatize by a series of manifestoes, proved, in the absence of a well-defined human right, applicable to all peoples, whatever degree of civilization they may have reached, solemnly and directly accepted by them without the compulsion of their respective governments, to be nothing more than a modern disguise of the right of force. —It is this so-called right that legalizes those military establishments which absorb so many useful arras, and so much fruitful capital; appealing by turn to the right of nations and the interest of sovereigns, the right of conscience and the interest of religion, it will destroy to-morrow what it erected yesterday; it changes arbitrarily the balance of international relations, and under pretext of establishing between nations one common law of justice and civilization, fosters their mutual enmities. —What would be said of a tribunal passing judgment under pressure of the interests and passions of the moment; applying a law which has neither been defined nor confirmed, and executing its own sentences? Such, however, is the power exercised to-day by the right of intervention. Does this mean that the juridical idea, the thought essentially human whence intervention proceeds, shall never be satisfied? I do not think so; the question ought to be put thus: Above the arbitrary conventions of politics, above treaties, above governments, above nationalities themselves, so frequently appealed to in our day, does a human law exist? Can it be established upon a serious, durable, respectable basis? What international convention could draw up this code of civilized nations? How should the members of this convention be chosen? What sanction should the constitution which might result from these deliberations, have? What tribunal would take cognizance of offenses against this new code? What would be the means of enforcing obedience to it, and the manner of executing the decisions of this international tribunal when it would have summoned before it a dispute between two nations, or the protestations of a nation against the despotism of its rulers? It is thus the question should be put, if we would give a respectable foundation to the right of intervention; if we would substitute reason for force, right for brutality, peace for war, a stable equilibrium for an insecure one, and economy for prodigality. Until it be resolved in this manner, we must condemn intervention, under whatever disguise it may conceal itself; for, springing from force, it can lead to nothing but arbitrary power. FRANCIS EDWARD HERVÉ. INVASIONINVASION. In every European continental war there is an invasion. When France, for instance, goes to war, either she invades the enemy's territory, or the enemy invades the territory of France. Undoubtedly it is to each nation's interest to carry the evils of war into the enemy's country, but they should not, in these circumstances, forget the precept: "Do unto others as you would that others should do unto you." It is, in fact, a rule that the invader should respect the persons and property of private individuals; it is a rule also that the civil population of the country invaded should be allowed to continue, as far as possible, their peaceful occupations. The question may, however, be asked: In case of an invasion, what should the citizen do? The question is a difficult one to answer, particularly if the answer required be a general one. Should the entire population rise as one man? We should incline to an affirmative reply, if the fear of a general uprising would be likely to prevent the invasion. But little attention is paid to theories in these matters. The people will take up arms if conquest be the object of the invasion, or if they are in sympathy with the government, or desire to expel the invader; but they may also remain indifferent. Indifference, however, in our day, is apt to lead to their own ruin. When the people take an active part in the war they no longer enjoy the immunities accorded to peaceable citizens. The enemy generally feel themselves justified in practicing greater cruelty upon armed citizens than upon soldiers properly so called. Specialists maintain that the enemy is obliged in self-defense to treat with severity every armed man who is not in uniform and does not form part of a regularly organized body; first, because they can not recognize him from a distance as a soldier, and can not guard against him; next, because the invading force spares men and property, only under the express condition that these men and this property shall not work them any injury. Nevertheless, we can not justify these excesses. All men taken with arms in their hands should be treated alike. Unfortunately, more attention is given to the voice of passion than to that of reason, in time of war, and men allow themselves to commit acts which they reprove and energetically denounce when committed by an enemy. MAURICE BLOCK. INVENTIONSINVENTIONS include all contrivances which increase the power of man in production. Their economic effect is to take the place of the labor of man, and at the same time to multiply the results of this labor, either by utilizing the forces of nature, or by deriving a greater benefit form the men and the various kinds of capital, of which inventions are themselves one of the most important groups. —The considerations which we are about to present apply, in all respects, to mechanical, chemical and physical discoveries and inventions of every kind, to all processes of whatever nature they may be, to all displacements of capital and the industries, to all advancement resulting from the application of an economic truth hitherto unknown or misunderstood, and having for its final result to produce in a better manner, more quickly and more cheaply; and to do this in agriculture, in manufactures, in transportation, exchanges, sciences, the arts—in a word, in all avocations. In the number of these improvements we may mention those which result from greater freedom of trade, which, bringing about the importation of products prohibited or too highly taxed, and opening the way to markets, may be compared to the employment of a series of new machines. —It is at once evident how the subject enlarges; for it is impossible, so far as results are concerned, to make an economic separation between inventions or even simplifications in what is strictly a mechanism, and a method of cultivating the soil, the employment of a chemical apparatus, or any administrative or scientific work. In them all we have forces better combined, better employed, and which give a better result, that is to say, which produce more, more quickly and more cheaply. —I. The Power of Inventions in Production. To produce more, more quickly and more cheaply, is an expression for all economic progress obtained by a better employment of the instruments of labor, which are the earth and other natural agents, the physical and intellectual forces of man, and capital. A well-ordered division of labor, and the employment of inventions, are, perhaps, the two most striking general examples of this progress that can be given. Let us cite a few facts which will show what an enormous difference modern industry, with its astonishing means of action, with the machines and inventions whose power it has been able to utilize, has made between society at the present day and communities before our time, which were considered as endowed with a brilliant civilization. —Before the invention of water mills and wind mills, slaves, poor prisoners or unfortunate women turned the millstone; and ancient authors inform us how slow and laborious this operation was. According to Homer, twelve women were constantly occupied in the house of Penelope in grinding the grain needed for the household. On the other hand, the most simple water mill, a mill rented at about $600 a year, a mill which will in its turn become antiquated by the side of the improvements in mechanics, can grind in one day as much grain as one hundred and fifty men. If this mill is in operation three hundred days in a year, its cost is ten francs ($1.93) per day; on the other hand, the men would cost at least three hundred francs: so there is a saving of two hundred and ninety francs, which, apportioned on thirty-six hectolitres (about 100 bushels) constitutes half of the price of the grain itself. —Homer did not say how many persons composed the household of Penelope; but Michel Chevalier,31 considering that Ulysses was king of a poor kingdom, thinks he exceeds the truth in estimating them at 300 in number. The same writer, considering, on the other hand, the mill of St. Maur, found that in this remarkable establishment, forty millstones under the charge of only twenty workmen, ground to flour 720 hectolitres (1,980 bushels), which would furnish food for 72,000 persons. In the time of Ulysses, the labor of one person was then necessary to produce the flour needed for twenty-five others. In our day, that operation has been brought to such a degree of perfection that one person can supply the flour for a population of 3,600 persons.32 or 144 times as much: consequently, now, 278 workmen, distributed in fourteen establishments like that of St. Maur, can grind for a million of the inhabitants of Paris. At Rome or in Greece, an army of 40,000 slaves were needed to produce the same result. Besides, there is no possible comparison between the condition of those who work in the improved mills of our day and the slaves turning the millstone; between the flour of a mechanical mill and that of Penelope's house. The most wretched of the Parisians eat bread a hundred times preferable to the black cakes of Ithaca's queen, and each of the workmen we just mentioned can procure for his home more comforts than the prudent Ulysses. —In the Pyrenees, where the ancient mode of working iron is kept up, with some improvement, however, one still finds forges similar to those which must have been used centuries ago. The quantity of iron representing a day's work of a man with these furnaces, may be approximately estimated at about six kilograms (over thirteen pounds avoirdupois). Modern industry has constructed blast furnaces,33 enormous structures, capable of running off from three to five thousand kilograms at a heat, if operated with charcoal, and from ten to eighteen thousand kilograms if operated with coke; and the average daily product of the labor of a man may be estimated at 150 kilograms of iron. In other terms, the labor of an iron worker is to-day twenty-five times more productive. Note also that the ores mined present more difficulties, and that the product obtained is better. —Another comparison will show us a prodigious growth, made not since the time of Homer or within centuries, but simply within the last three-fourths of a century. Spinning machinery, in fact, which has given rise, as if by enchantment, to so numerous and such fine manufactures, dates no farther back. It was only in 1769 that Arkwright took out his first patent; and only in 177434 that Watt, whose inventions made the steam engine common, took his. The cotton industry, as it exists to-day, is the work of these two men. Thanks to them, admirable spinning machines set in motion hundreds of spindles which are so disposed and combined, that it is calculating largely to estimate five workmen to take charge of two frames connected with 800 spindles, or one workman for 160 spindles. But a good spinning mill of India or Europe makes just as much thread as half a spindle; so that a cotton spinner to-day turns off 320 times more thread than in 1769; in other terms, within a little more than a century, the productive power of man has increased 320 times in that necessary industry. In the spinning of flax, which is of comparatively recent date, one person is sufficient to take care of 120 spindles, which produce as much thread as 240 spinners, and the thread produced is finer. —It has been by combining the advantages of the division of labor with mechanical and steam power that printing has wrought those prodigies which defy all comparison. Workmen transform the copy of the writer into pages of type; but a machine impelled by steam, and aided only by two or three men, spreads the ink over this type, carries the sheets of white paper over it as fast as they are presented, prints them, and delivers them on the other side to the person whose business it is to collect them. There are machines which ordinarily print five or six thousand copies35 an hour. How many copyists would be needed to do as quickly and as well? —By the aid of a simple mechanism, called a slide, people succeeded in extracting from the depths of impenetrable forests, trees which were there valueless. Such a slide was that of Alpnach, in Switzerland, which for several years enabled the century-old trees lost on the heights and in the gorges of Mt. Pilatus to be utilized. By means of plane surfaces ingeniously supported by scaffoldings, passing over precipices, over and under numerous rocks, and following a well-managed gradient, these trees traveled over a space of twelve kilometres (about seven and a half English miles), in two minutes and a half. In six minutes a tree passed from the forest into Lake Lucerne; thence it descended the Reuss, and went by the way of the Aar and the Rhine to the sea. —The progress attained in our day in ordinary transportation is not less phenomenal. When Fernando Cortez arrived in Mexico, everything was transported on the backs of men. This is still the case in many localities in America, Asia, Africa, and even in Europe. Wherever the improvement of the roads would allow transportation on the backs of quadrupeds, the progress has been as thirty kilograms (about sixty-six lbs.), the load of a man, to 200 kilograms (about 440 lbs.) the load of a good horse traveling at a walking pace. Wherever the roads have become passable for carriages the same motive power has been able to draw, on a two-wheeled cart, a weight at least five times greater. On a canal, and with a boat, the same horse draws from eighty to a hundred times more; that is to say, eighty to a hundred thousand kilograms. On railroads, traction is ten times more easy than on ordinary roads. On these, travelers ordinarily go ten (French) leagues or forty kilometres (about twenty-five English miles) an hour; merchandise, four to five leagues. Whole populations and masses of merchandise are transported at one trip, and that at prices extraordinarily reduced, being between twenty and five centimes per ton and per kilometre, according to the kind of merchandise. One makes in a few hours a journey which, not many years ago, required several days, and, a century ago, weeks and even months. In 1763 the public conveyance from Edinburgh to London took a fortnight; in 1835 the stages went this distance in forty-eight hours; to-day the trip may be made by railway in eight hours. Madame de Sévigné tells us that in 1672 it was necessary to sacrifice a month in order to go from Paris to Marseilles, a journey that is made in sixty hours by the ordinary roads, and that can be made in one-third this time by railway. "Time is money," say the English, money that may be saved. "It is the material of which life is made," said Franklin. The economy to the people of the new ways of communication is therefore considerable. Suppose a line of travel frequented by a half million travelers. The saving of an hour for each traveler produces for the whole the sum of 500,000 hours, or 50,000 days, representing a year's manual labor of 166 men who do not increase by one cent the general expense of food, and whose time has a value much superior to that of the average workman. —We may add that in the time of Madame de Sévigné and even considerably later, such journeys involved perils sufficiently serious for it to be prudent to make one's will. In our day, and notwithstanding the extreme rapidity of steam travel, the chances have been singularly diminished. In England, only one victim (killed or injured) is estimated to 500,000 or 600,000 travelers. —We have just called attention to the fact that the saving produced by inventions for transportation may be estimated in the days' work of men who do not increase the general supply of food. This observation is important, and we ought to extend it to the action of inventions. It was estimated that there were in France, in 1846, nearly 4,400 steam engines, equivalent to 1,100,000 men. These eminently laborious automats, coming to the aid of the human population, content themselves with coal for their only food, and in no way diminish the supply of provisions or make them dearer. —II. Economic and Moral Effects of Inventions. It is superfluous to dwell here on the manner in which inventions, the first effect of which is an abundance of products and a lowering of prices, finally result in the possibility of a continually increasing number of the population procuring for themselves these products; and how inventions thus diminish their sufferings, increase their material well-being, and obtain for them the means of participating in the share of intellectual and moral enjoyments of which civilization permits the attainment. (See CONSUMPTION.) The high price of products is the principal obstacle to the progress of society. There is a tendency in society (constantly progressive, but hitherto incapable of attaining its object) toward a condition which may be expressed as being an accumulation of alimentary substances, of those which serve for clothing and for dwellings as well as of objects of science and the arts, so that every man may always be able to procure for himself and his family larger and larger quantities of these objects. This is a result desired alike by the philanthropist, the philosopher, the economist and the statesman; and it is every day approaching realization, through the fecundity of human genius, expressing itself in improvements and inventions of every kind. Formerly the English cotton factories scarcely met the demands for internal consumption, which averaged a decimetre of cloth for each person. To-day they give from sixteen to eighteen metres, and they export considerable quantities. Prices grow lower every day. "Consequently this soft, convenient and useful cloth, formerly so dear and so rare, is to-day within the means of every one. This is almost a revolution in manners. A change has been wrought in domestic life; a love for neatness and a habit of it, have become general; and "cleanliness," as the English preacher, Wesley, said, "is more than a quality: it is a virtue which elevates the soul, because it gives man a sense of his dignity." (Michel Chevalier, Cours d' Economie Politique, p. 91.) —In the reign of Henry II. no one had a handkerchief; most of the great lords were themselves obliged to wipe their noses on their elbows. Through the progress in agriculture, navigation, spinning and weaving, most of the French to-day can be provided with some of these aids to neatness. The same is true of shirts, and of all the necessaries of life. In former times, the purchase of a Bible required a small capital; to-day an infinite number of works are sold at only a few sous, and in England and the United States the humblest family can take at least one weekly journal. Only a short time ago traveling was a great luxury; by the improvement of the avenues of communication, it is now within the reach of every one. —The facts which we have given, and others still more numerous which we might recall, prove how mechanical, physical and chemical inventions unite powerfully to realize conditions of liberty and equality, to redeem man from slavery, properly so called, as well as from that other slavery of privation and brutalizing labor, and to elevate him in his own eyes and in those of his fellow creatures. Religion and philosophy have in turn proclaimed these great principles of liberty and equality; but, as M. Aug de Gasparin observes, (Considérations sur les machines, Lyons, 1834), they would have remained powerless to give them value without progress in the industries. Slavery, we must not forget, existed among the ancients side by side with philosophy; in modern times it was imported into the colonies and maintained there by Christians, both Catholic and Protestant. Religion and philosophy would alone be incapable of accomplishing the temporal redemption of humanity. Mills have come and freed a host of slaves, who, among the ancients, were engaged in pounding grain in mortars or turning grinding stones by hand; and those whom the lot of war condemned to be simple machines, have been replaced by millers to whom free labor always secures a modest competency, and sometimes wealth and consideration. The sail effected the deliverance of the unfortunate ones who were compelled to ply the oar, a labor so severe that slaves among the ancients, and malefactors, in more recent times, were, under the name of galley-slaves, put to this work. To the sail, steam is added; and henceforth the sufferings of the sailorboys and the sailors are alleviated; the privations they endure are less severe; their manners become more gentle. Intelligence has come to take the place of force, or better, to direct it, guide it, and make it productive. —What we say of the severe and fatiguing labors, is still more true of the labors of a repulsive and dangerous nature, which scientific processes modify or transform, or of which inventions wholly relieve men. Such, for example, is the new method of gilding and silvering, which dispenses with the intervention of mercury, so destructive of human life; such is the new way of cleaning ditches, which saves laborers from the morbid effects of sulphureted hydrogen, and their tools from its corrosive power. —Let us also observe that, by favoring the division of labor, mechanical and other improvements bring women back more and more to the care of the family and of housekeeping, and make it possible for all the faculties of man to be cultivated and made productive in the general interest of humanity. It has been noticed that in England and the United States, where mechanical appliances have been largely developed, women labor very little in the fields, and are not seen bending under the weight of a harvest burden or a basket of manure. This sad spectacle, on the contrary, meets us in many parts of continental Europe, and even in several localities in France. In Paris, itself, in the heart of civilization, it is not rare to see women harnessed to vehicles, or bending under the weight of heavy burdens. It is also in countries where improvements in agriculture have been the greatest, that it most fully employs the resources of mechanics, the power of animals and the teachings of science; in countries where transportation is the easiest, that the means of subsistence are produced with the fewest hands, and consequently that a greater number of minds can turn to other branches of human activity, such as the industries, commerce, the arts and philosophic and scientific researches, the influence of which then makes itself felt on laboring men and indeed on all humanity. —There is one last remark we wish to make. Certainly, every one is of the opinion that industrial improvements, machinery and other applications of science, give nations a greater desire to have security maintained, and that, by binding people more closely together through the growing exchange of products, of ideas, of sentiments and of esteem, their influence has already made war, conquest and domination unpopular; and every day this same cause renders more difficult the return of that folly of princes and peoples, an impious recourse to arms. But on this point there is a still more direct influence of inventions and the genius of invention, which we must here take into account. In becoming perfected, instruments of destruction, by one of those admirable apparent contradictions of which Providence holds the secret, become in fact less to be dreaded. There has been less destruction of human life since the invention of cannon. Battles where guns are used are relatively less fierce than those with swords; a few projectiles intelligently thrown can take the place of those impetuous assaults after which the conquered were put to the sword, and the conquerors, mad with victory, marked their pathway with blood. It is because the certainty of destruction has been increased by the improvements in firearms; and it is in the nature of the most courageous even, to shun such a certainty. —We have, as we think, sufficiently analyzed the power of inventions, and their industrial and social effects. We have, however, said nothing of the services rendered humanity by printing, nothing of the influence of the improvements in the means of communication, both by land and by sea, nothing of postal communication, of the mariner's compass, or of the electric telegraph! III. Objections made to Inventions; Inventions always useful to Society and to Labor in general. The case of inventions has been won in political economy; but the prejudice which condemns them has still too many echoes in society for us to here pass over in silence the arguments which perpetuate it. Let us proceed with them in due order. Here is the fundamental objection, which goes to the heart of the problem, and which is the root of the thicket of sophisms formed by all the others. People can not and do not deny the prodigious effects of the employment of machines and the resulting economy of productive force; but they say (and this was the very objection of Montesquieu36 ), that this economy for some is compensated by the loss of others, and that finally society grows poorer by the amount of labor saved by the invention and lost to those of its members whom it deprives of work. —We will not dwell on the question of justice which meets us here. John produces an article under certain conditions, and makes me pay a certain price for it; Paul exercises his ingenuity, and finds a way to do better and to offer me the article at a lower price. By what right does John keep the monopoly of doing worse? In virtue of what justice is Paul not to be permitted to do better, and I compelled to buy of one rather than the other? But we will not dwell on this. It is not correct to say that society loses, and on this point we will give the words of Bastiat: "Jack had two francs with which he was employing two workmen. But he conceives an arrangement of ropes and weights which shortens the labor by half. He therefore obtains the same result, saves a franc and discharges a workman. He discharges a workman: this is what people see. * * But behind the half of the phenomenon which people see, there is another half which they do not see. They do not see the franc saved by Jack and the necessary results of that saving. Since, in consequence of his invention. Jack spends but one franc for manual labor, in the pursuit of a particular advantage, he has a franc remaining. If then there is in the world a workman with unemployed hands, there is also a capitalist who offers this unemployed franc. These two elements meet and combine, and it is as clear as daylight that between the demand and supply of labor, and the demand and supply of wages, the relation is in no respect changed. The invention and the one workman paid with the first franc now perform the work which was formerly accomplished by two workmen. The second workman, paid with the second franc, produces a new piece of work. What then has been changed in the world? There is one more object in the country that can satisfy human desire, in other terms, the invention is a gratuitous conquest, a gratuitous profit to humanity. * * * Its final result is an increase of satisfaction for the same amount of labor. Who gains this additional satisfaction? First, the inventor, the capitalist, the first one who employs the invention successfully, and this is the reward of his genius and of the risk he has taken. In this case, as we have just seen, he realizes a saving in the expense of production, which, in whatever way it may be spent (as it always is), employs just as many hands as the invention has caused to be discharged. But soon competition forces him to lower his selling price in proportion to the saving in expense. And then it is no longer the inventor who gets the profit from the invention, but it is the buyer of the product, the consumer, the public, including the workman—in a word, mankind. And what people do not see, is that the saving thus effected by all consumers creates a fund from which wages get a supply, which makes up for that which the invention had stopped. Thus, to recur to the above-mentioned example: Jack obtains a product by expending two francs in wages. Thanks to his invention, the manual labor costs him only one franc. So long as he sells the product at the same price, there is one less workman occupied in making this especial product this, people see; but there is one workman more employed by means of the franc which Jack has saved: this, they do not see. When, in the natural course of things, Jack is compelled to lower the price of his product a franc, he no longer realizes a saving by the invention: then he will no more have an extra franc at his disposal, with which to command, of the labor in the nation, another product. But, in this respect, the purchaser is put in his place, and this purchaser is mankind. Whoever buys his product pays for it a franc less, saves a franc, and necessarily holds this saving, at the service of the wages fund: this, again, people do not see'37 —Applying this demonstration to the example of the water mill, which we gave at the beginning, we find that instead of paying at least 290 francs per day to those who turn the grinding stone, the consumers of flour, which is made in mills, turn over these 290 francs into the common fund of wages, from which those who turned the stones and who will now employ their time at some other occupation to produce something else useful to society, will derive the benefit. It is, therefore, not true that society loses by the employment of a new invention which saves money to the buyer. For this saving is simply changed in direction: as the industries are conjoined in their interests, what is economized in one, goes to another. They form, as Bastiat has also said, a vast whole of which all the parts communicate by hidden channels: and consequently economy does not occur at the expense of labor and wages. —Another demonstration may be given that inventions do not injure society. It is that which J. B. Say (Nouveaux Principles d'Economie Politique, vol. i. chap. vi.) addresses particularly to Sismondi, taking up the objection of Montesquieu and starting with the premise that the wants of nations are a fixed quantity, that, in consequence, every time that consumption exceeds the means of production, every new discovery is a benefit to society, and that when production suffices fully for consumption, every similar discovery is a calamity. At the outset we should remark, that Sismondi grants the utility of inventions in a case which, taking everything into consideration, is the general case, and J. B. Say, in fact, to reply to him has only to deny that the wants of society are a fixed and assignable quantity; because population increases, because every day we make use of products unknown to those who came before us, because, as the invention reduces the expense of production, the lowering of the price of the product incites to an increase of consumption, which necessitates an increase of production, and, in the end, the employment of as many men, or even more, after the invention as before it (we shall revert to this point): because, finally, the products created by a producer furnish him the means of buying the products created by another, and in consequence of this production both are better supplied. And here J. B. Say calls to his and the theory of markets, on which he has thrown so much light. He also cites the development of two great parent industries, very modest in their beginnings, but which the genius of invention has developed so enormously and so rapidly that they have become trunks with almost innumerable branches, employing a thousand times as many laborers as formerly38 These two industries are printing and spinning cotton. We might mention many others, and prove by statistics, that at the end of a certain time the new industry engages, either directly or indirectly, a larger working population. This demonstration corroborates the preceding. Alone, it would be insufficient; for it would leave one to conclude that in the case (very rare, it is true) where the special consumption of the product in question remains stationary or nearly so, the invention is an injury to labor, which is incorrect; for not only does it not harm society, but it is of advantage to it by putting it in the way of increasing its gratifications without increased effort, and by giving it an opportunity to accumulate an increase of capital, with which it can pay for more labor. —Other minor objections have been made to inventions. It has been said that they impose upon man oppressive toil. But this conclusion has been drawn from a few particular cases which have not been clearly brought under the general rule. To any one who has a little acquaintance with industrial occupations as a whole, this assertion has no foundation. If inventions have one evident, incontestable effect, it is to simplify and lighten labor. It has been said that they render industrial labor irregular, by promoting alternations of activity and complete stagnation, and consequently exhausting the workman by over-work and condemning him afterward to poverty. This objection is likewise the expression of imperfect observations. The employment of inventions supposes establishments on a large scale, whose proprietors have invested a large amount of capital. Now, it is only at the last extremity that those who carry on such establishments stop their business, because they do not wish to lose interest on their capital and general expenses; and experience proves that before suspending work, these business men sacrifice their own interests and even knowingly incur losses in hope of better days. These efforts to continue production are less in establishments which do not employ inventions, and which, in the alternative of suspending labors or continuing them at a loss, hesitate less to discharge their workmen. Inventions have also been accused of promoting division of labor, over-stimulating the increase of the manufacturing population, leading to excessive production and industrial crises, and bringing on a decline in wages and too severe labor. These are all objections which, were they well founded (which we are not willing to admit), would be wrongly attributed to inventions. The latter are sometimes the effect and sometimes the cause of a greater division of labor; but this division is one of the greatest means of progress, and the charges brought against it will hardly bear examination. (See DIVISION OF LABOR.) It is not to inventions that we should impute the incitement to self-multiplication among the working population, but to the system of protection and prohibition. Inventions have more properly the reverse effect, by lightening the occupations of man and thereby improving his morals. Excess of production and crises also arise from causes entirely different. (See CRISES, PRODUCTION.) As to decline in wages and the excessive length of a day's labor, these result from an excess of working population, a subject which will be presented and developed under the word POPULATION. We can, however, say here that the condition of the working classes in our day, compared with that of times more remote, when inventions were not common, and that the condition of the working classes of manufacturing and agricultural countries where the employment of inventions is considerable, compared with that of the same classes where inventions are rarely used, proves that the facts observed are at variance with the objections just stated. Sixty years ago the great mass of the English and French people were not nearly so well provided with necessary articles. Nor must we look to Egypt or any other country still destitute of inventions, for comfort, morality and intelligence. —IV. Inventions may displace Workmen; numerous circumstances which counterbalance this disadvantage. If we consider only the workmen whose place the invention takes, we see at once men deprived of their work, their means of living, and obliged to seek other occupations, to put themselves to a new apprenticeship, and to suffer the privations of a stoppage; hence, anxiety and suffering "Here," says Rossi, (Cours d'Economie Politique, 2d vol., 10th lesson). "we have a grave fact, a fact which the defenders of inventions would be wrong to question. * * When it was claimed that this fact merited little consideration; when it was asserted that laborers passed readily at once from one kind of work to another; that the increase of products and the decline in prices, and the increasing general consumption, caused the same producer soon to demand again, not withstanding the inventions, the same number of workmen as before, I do not hesitate to say, the question was evaded, and, to a certain point, the true results of the operation were concealed." We will add, that it would be interpreting Rossi erroneously, to adjudge him hostile to inventions. If he does not defend them, it is, as he says, because they defend themselves. They mark industrial progress, and "industrial progress nothing can arrest."39 We agree with Rossi that it is well, in political economy, not to evade difficulties; but, happily, we have a statement to insert here, of several circumstances which can, and which in fact do, diminish the inconveniences which may temporarily result to the working class from the introduction of inventions which accelerate production. 1. New inventions are generally expensive, and a large amount of capital is needed to put them in operation. If this difficulty does not prevent their final adoption, it at least delays it. Convincing proof of this can be found in the history of most industries. 2. The routine spirit, the dread of innovations, and the fear of losing capital, delay the application of new inventions, render the transition gradual, and sometimes prevent the appearance of any inconveniences. 3. In proportion as the arts become more nearly perfect, the invention of machines becomes more difficult. There is a degree of art in which blind force is made to execute all that is possible to it, and where man fulfills only a purely intellectual function. —But in the century which has just elapsed, and which is so remarkable for the progress of the sciences and the industries, certain classes of workmen have been most cruelly affected. In our times we may mention those of Belgian Flanders, whom the introduction of flax-spinning, added to other causes, reduced to poverty. (See Etudes d'Economie Politique et Statistique, by M. Wolowski; Guillaumin, Paris, 1848.) Because of these facts, writers have thought they must make out a case against new inventions, industrial innovations, and the general displacement of labor and capital. In whatever has been said, no one has thus far been able to refute the body of considerations which we have presented. We should add, many of the opponents of inventions and of industrial improvements used this theme to exaggerate the defects of present society, which they proposed to reconstruct from the foundation, and that it was to them a literary or scientific instrument, far more than an economic or scientific discussion. —To recapitulate: those who have rejected inventions have seen that they were obliged to oppose the increase of useful things, oppose economy in production, the attainment of a result with diminished effort; in short, to maintain the theory of poverty; and more than one has used faulty logic. But let us revert to the displacement of workmen. Means have been sought to remedy this evil, which, happily, is temporary and transient. Barbarians thought they could proscribe machines. The reader will hardly permit us to stop to consider this opinion. To reject machines is to reject every invention, every improvement, every innovation, every step forward. And, as every man thinks, invents and perfects more or less in his especial business, it would be necessary to decree immobility of intellect, the death of humanity. It is absurd: that is all. As for the rest, we join in Ricardo's remark (p. 241, M'Culloch's edition of Ricardo's works): "The employment of machinery could never safely be discouraged in a state, for if capital is not allowed to get the greatest net revenue that the use of machinery will afford here, it will be carried abroad, and this must be a much more serious discouragement to the demand for labor than the most extensive employment of machinery; for while a capital is employed in this country it must create a demand for some labor; machinery can not be worked without the assistance of men; it can not be made but with the contribution of their labor. By investing part of a capital in improved machinery, there will be a diminution in the progressive demand for labor; by exporting it to another country, the demand will be wholly annihilated." There are people who dare not go so far, and who propose to prevent or prohibit only certain inventions, perhaps the most complicated, or those which take the most work from the workman, or the newest. But if one should ask the authors of these propositions to themselves classify the inventions to be preserved or destroyed, to be allowed or proscribed, they would really not know how to reply. If steam is to be rejected, why not the power of wind or water? Why mills to grind the grain? Why stones? And would the plowshare, which does the work of ten men working with a spade, find favor? We are indeed, we repeat, still wholly absurd, and we must make haste to rid ourselves of our absurdity. But, do you ask what we must do? Let us first tell what has been proposed. —M. de Sismondi, the most serious opponent of machines, draws no definite conclusion. Only one may say that the logic of his criticism, inspired by honest feeling, but based on imperfect observation, leads to the abandonment of the division of labor, of machines, and of manufactures, and to a return to a patriarchal state of society, which M. Proudhon has defined as "the system of every one at his own abode, every one for himself, in the most literal acceptation of the phrase." M. Proudhon adds: "It is to go backward; it is impossible" J. B. Say had already said so to M. de Sismondi; but it is well to have it repeated to him by the harsh criticism of the Malthusians (Contradictions Economiques, 1st vol., iv., § iii.) —The communists and socialists reasoned thus: "Since the object of inventions is to render man as rich as possible with the least labor, since the natural agents must do everything for all, inventions ought to belong to the community." Then follow, as remedies for the evils attributed to inventions, the various new systems of social organization. It is not for us here to discuss these illusions. (See SOCIALISM.) —Another opinion arises from this, without being as logical: it is that of those who have proposed an association of the inventors, proprietors and workmen. This is another utopia, which it would take too much time to discuss here; we confine ourselves to its mere mention. —It has been proposed that the workmen should be indemnified by the inventors, or by the capitalists and manufacturers who make use of the new inventions. Here arises at once a question of justice, property and rights. But, the question of justice aside, who does not know the uncertainties of new enterprises, the perplexities and mortifications of inventors and those who first apply the inventions! Should not these also have a right to indemnification? And then who, pray, would not have a right to complain of the wrong done him by any innovation, any improvement whatever? Has any one dreamed of the indemnities which would have been due for the application of steam, for the introduction of stages, canals or locomotives? —People can not insist on this order of ideas, and so they propose that the state be the chief indemnifier. But if one only means philanthropy and alms, we will remark, at the outset, that the state has no other pockets than those of its citizens, and that the most numerous class of citizens are the poorest. We admit, however, that there may be a case in which humanity and prudence would recommend either the creation of public works to give temporary relief to the displaced workmen, or some other kind of assistance. These are precarious means; but there are no others; and the final conclusion of this matter is, that the bad effects of an invention being always exceeded by the social advantages it secures, will be so much the less felt by the workmen it displaces, as the industry prospers the more, and the unclassed laborers the more readily find again a remunerative occupation and are able, from previous savings, to provide for their necessities during stoppages. —In the number of means for contending with the disadvantages of inventions should then be found a general diffusion of the first principles of political economy, in the schools, by the aid of which the children, who will some day be workmen, would begin to comprehend the true nature of things, and would be fortified in advance against the prejudices which incite them later to hate and oppose inventions, or to depend upon chimerical means for subsistence. —V. Conclusion. To recapitulate: the question of inventions is one of the most clearly resolved in political economy. —The right to invent, to improve, and to apply, is unassailable in itself. Moreover, its prohibition is impossible. —In the second place, society derives from every rational, mechanical, scientific, administrative or other change, more satisfactions for less effort, satisfactions which can be measured by the effective power of modern industries. —In the third place, the improvements made in the industries are not long in curing the individual evils, which sometimes, but not always, result from the displacement of labor and capital. These evils can not be compared with the advantages which counterbalance them, and they are so much the less as the industry is the more prosperous. —Finally, we can do no better than close with one of the observations with which we began, and we borrow the words of Bastiat: "There is a natural inclination in men to go, unless forcibly prevented, to a good market, that is to say, to that which, with equal satisfaction, saves them labor, whether this good market comes from a skillful foreign producer or from a skillful mechanical producer. The theoretical objection made to this inclination is the same in both cases. In both cases it is accused of paralyzing labor. Now labor rendered not inert, but disposable, is precisely what determines this inclination; and this is why, in both cases, it is opposed by the same practical obstacle, viz., force. The legislator prohibits foreign competition and interdicts mechanical competition: for what other means exist of arresting an inclination natural to all men, except to take away their liberty? In many countries, it is true, the legislator strikes at only one of these two kinds of competition, and contents himself with lamenting the other: this proves only one thing, which is that, in this country, the legislator is inconsistent. This need not surprise us: on a wrong road, people are always inconsistent; if it were not so mankind would be destroyed. Never have we seen and never shall we see a false principle carried out to the extreme. I have elsewhere said: Inconsistency is the limit of absurdity. I might have added: it is at the same time the evidence of it." (Bastiat, Ce qu'on voit et ce qu'on ne coil pas; Paris, Guillaumin, 1850, brochure in 16mo, p. 49.) Nothing can be more just than these words of our illustrious co-worker and friend. —The question of inventions did not engage the attention of Adam Smith; yet a part of his celebrated chapter on division of labor relates to this subject. J. B. Say contributed much to its elucidation, first in his Treatise, afterward in his Course, 1st part, chaps, xviii. and xix. See also the Course, by Florez Estrada. chap. ix.; the first lessons, by M. Michel Chevalier; the Elements, by M. Joseph Garnier, etc. See also the pamphlet by M. A. Gasparin, often quoted above. Mal thus and Rossi have said little on this subject. Ricardo has developed some particular points in his Principles, chap. xxxi. (See above.) Sismondi has only spoken of it in one very short chapter, devoted likewise to the effects of division of labor, which circumstance produces a certain confusion in his objections. Socialistic schools and political pamphleteers have, in turn, exaggerated the advantages or disadvantages of inventions M. Proudhon has, in Contradictions Economiques, given considerable attention to inventions. He is favorable to this species of improvement; he analyzes and combats the various means proposed to neutralize directly the displacement of workmen which a new invention may occasion. (See CAPITAL, DIVISION OF LABOR, FREE TRADE, INDUSTRY, MACHINES.) JOSEPH GARNIER. IOWAIOWA, a state of the American Union, formed from the "Louisiana purchase." (See ANNEXATIONS, I.) After the organization of the state of Missouri in 1820-21 (see COMPROMISES, IV.; MISSOURI), the territory north of that state extending to British America, and lying between the Mississippi and Missouri rivers, was neglected by congress until the act of June 28, 1834, made it a part of the territory of Michigan "for the purpose of temporary government"; the act of April 20, 1836, took it from Michigan territory, after July 3 following, and added it to Wisconsin territory; and the act of June 12, 1838, erected it into the territory of Iowa, after July 3 following. Oct. 7, 1844, a convention of delegates from the southern part of the territory formed a state constitution, claiming about the same boundaries as at present. This territory seemed to congress unreasonably large, and the act of March 3, 1845 (see FLORIDA), while admitting the state, assigned to it as a western boundary the meridian of 17° 30' west of Washington, and as a northern boundary the parallel passing through the mouth of the Blue Earth river, in the present state of Minnesota; Iowa would thus have been about half as wide as at present, and slightly longer from north to south. The boundaries having been submitted to the people of Iowa, in accordance with section four of the act, were rejected by a vote of 7,235 for and 7,656 against it, and Iowa remained a territory. A convention, which met May 4, 1846, at Iowa City, formed a new state constitution, which was ratified by popular vote, Aug.3. It defined the state boundaries as follows: "Beginning in the middle of the main channel of the Mississippi river at a point due east of the middle of the mouth of the main channel of the Des Moines river; thence up the Des Moines river to the northern boundary of Missouri; thence westward on that line to the Missouri river; thence up the Missouri to the Big Sioux river; thence up the Big Sioux to the parallel of 43° 30' north latitude; thence east on that line to the Mississippi river and down the Mississippi to the beginning." A supplementary act of congress of Aug. 4, 1846, accepted the boundaries thus defined, and the state was finally admitted by act of Dec. 28, 1846. —The constitution of 1846 prohibited slavery, the loaning of state credit to individuals or corporations, the contraction of a state debt of more than $250,000 or county debt to more than 5 per cent. of its property valuation, and the granting of charters except by general laws; made the sessions of the legislature biennial and the governor's term two years; restricted the suffrage to white males; and fixed the capital at Des Moines. A new constitution, formed by a convention which met Jan. 19, 1857, and ratified by popular vote Aug. 3, changed none of the above particulars, and no change has since been made except that the word "white" was stricken out of it in 1868. —The political history of Iowa falls into two periods, 1846-54 and 1855-81. In the first of these the state was democratic in all elections, presidential, congressional and state, except that a whig congressman was chosen in one of the two districts in 1848. The general election of 1854 was the turning point between the two periods; in it the republicans succeeded in electing the governor, one of the two congressmen, a heavy majority of the lower house of the legislature, and came one short of a majority in the upper house. One result was the election of James Harlan to the United States senate. Since that time (1855-81) the democratic party has been practically a nonentity in the state. Until 1859 one of the United States senators (chosen in 1853) was a democrat, and in 1854 and in 1874 a democrat was chosen in one of the congressional districts; these, and from 20 to 40 of the 150 members of the biennial legislatures, have been the extent of democratic influence upon the politics of the state. The republicans have elected all the governors, United States senators and representatives (with three exceptions), and have maintained from 60 to 70 per cent. of the popular vote. In 1874 the democrats, taking the name of "anti-monopolists," succeeded in electing one of the nine representatives, in the northeastern or Dubuque district, by a majority of but 63 in a vote of 22,069; in 1878 two of the representatives, Weaver and Gillette, were "greenbackers," the former from the southern or Keokuk district, and the latter from the southwestern district of the state; but in all these cases the lost district was again carried by the republicans. (See PROHIBITION.) —This almost invariable regularity has operated very much to the disadvantage of the public men of the state. One party has always been careless, and the other party hopeless, as to the result of Iowa's vote; and the favors of the national parties have been reserved for the public men of states whose vote was more doubtful. Consequently, though Iowa has never lacked able men, their services have been better appreciated by the state than by the nation. Among them are W. B. Allison, republican representative 1863-71. United States senator 1873-85; Wm. W. Belknap, secretary of war under Grant (see ADMINISTRATIONS, IMPEACHMENTS, VII.); James W. Grimes, first republican governor of the state, United States senator 1859-71; James Harlan, United States senator 1855-65 and 1866-73, and secretary of the interior in 1865, John A. Kasson, representative 1863-7 and 1873-7, and minister to Austria 1877-81; Samuel J. Kirkwood, governor of the state, United States senator 1866-7 and 1877-81, and secretary of the interior under Garfield (see ADMINISTRATIONS); and George W. McCrary, representative 1869-77, secretary of war under Hayes, and appointed United States circuit judge in 1879. —The name of Iowa was given from that of its principal river, an Indian word said to mean the sleepy ones; but its popular name is The Hawkeye State. —GOVERNORS: Ansel Briggs (1846-50); Stephen Hempstead (1850-54); Jas. W. Grimes (1854-8); R. P. Lowe (1858-60); S. J. Kirkwood (1860-64): W. M. Stone (1864-8); Samuel Merrill (1868-72), C. C. Carpenter (1872-6); S. J. Kirkwood (1876-8); John H. Gear (1878-82). —See Poore's Federal and State Constitutions; Plumb's Sketches of Iowa (1839); Parker's Iowa as it is (1855); Barber and Howe's History of the Western States (1867); Ingersoll's Iowa and the Rebellion (1867); Salter's Life of J. W. Grimes; the acts of June 12, 1838, and March 3, 1845, are in 5 Stat. at Large, 235, 742, and those of Aug. 4 and Dec. 28, 1846, in 9 Stat. at Large, 52, 117; Porter's West in 1880, 272. ALEXANDER JOHNSTON. IRELANDIRELAND, an island on the western extremity of Europe, constituting a portion of the state known as the United Kingdom of Great Britain and Ireland, lies between the parallels of 51° 26' and 55° 21' north latitude and between 5° 20' and 10° 26' west longitude, Greenwich meridian. It is 306 miles long and 182 broad; its superficial area being about 32,713 square miles, or 20,808,320 British statute acres. The interior of the island is in the main a fertile plateau, but toward the shore on the south, west and north, rugged mountains rise irregularly to a height in some places of over 3,000 feet. The coast, on the west especially, is bold, and in many places precipitous; but is, on every side, except on the southern portion of the eastern shore, deeply indented with bays, fiords and estuaries, affording natural harbors of great capacity. The scenery is strikingly picturesque; in some parts of unsurpassed beauty. The southern and western counties, however, contain many tracts of bleak and desolate country. In the low-lying parts of the island there are vast areas of peat moors or "bogs," embedded in or beneath which are found the remains of primeval forests. There is historical certainty that more than a thousand years ago the island was richly timbered from sea to sea; but the destruction of the woods by the English power in the course of its five centuries of warfare with the natives, has left Irish landscape on the whole exceptionally bare of trees. There are numerous lakes; some of considerable size. The principal river, the Shannon, flows into the Atlantic on the western side of the island; the Lee, the Blackwater, and the combined Suir, Barrow and Nore reach the sea on the south coast; the Bann and the Foyle on the north; and the Slaney, the Liffey and the Boyne on the east. Of the cities and towns of Ireland, few can be deemed important as to size or commercial activity; the principal of them being Dublin, Cork, Belfast, Waterford, Limerick and Derry. The first named city is, as it has been since the reign of King John, in the thirteenth century, the national metropolis and seat of government. The country is politically divided into four provinces; these being subdivided into thirty-two counties. —The climate of the country is mild and genial; more moist than that of France or Britain, but much less rigorous than that of either in winter. Although coal, iron, copper, lead, silver and gold have at one period or another been mined in Ireland, shafts and adits of long-forgotten times being occasionally discovered, the mineral resources of the country, judged by practical experience, are poor. Manufacturing industries, unless on a very insignificant scale, are almost unknown, outside the province of Ulster; the great bulk of the inhabitants being engaged in agricultural pursuits. The population was, at the last census, 5,159,839; exhibiting a serious and steady decrease since 1841, when it was 8,175,124.40 —Ireland is governed by a viceroy, subject to the imperial cabinet in London, and is represented in the imperial parliament by 103 members in the house of commons, out of the 652 who constitute that body. Out of 494 princes, peers and bishops, who sit in the house of lords, 28 are titularly Irish. —Few European countries are possessed of authentic historical data reaching to an age so remote as that to which the ancient records or memorials of Ireland in one shape or another extend. Like all old countries it has its fabulous and legendary periods; but reasonable certainty is attainable at a much earlier period in Irish history than it is in most other cases. The inhabitants of Ireland, of what may be called the native race, belong to the great Celtic family. For two thousand years past they have claimed to be pre-eminently "Milesians," that is to say, descended from an expedition of conquerors, led by the three sons of a military chief named Milesius, who, according to well received tradition, landed and subdued the country some ten or twelve centuries before the birth of Christ. But inasmuch as at least two distinct colonizations had previously been effected, and as the Milesians simply reduced their predecessors into subjection, and did not extirpate them, it is clear the general population in the course of time became more or less a combination of the new elements and the old. The Milesians originally came from a birthplace variously fixed in Persia. Syria and Phœnicia, and indisputably were of eastern origin. They were a race of soldiers and statesmen, conquerors and lawgivers. It was they who virtually organized and constituted the Ireland known to history for the last 1,500 years. The political system they established was a strange mixture of a republican monarchy and a military aristocracy. The country was divided into five sub-kingdoms, an Ard-Ri (literally high-king) being supreme sovereign. This chief-king was elected from the reigning family or dynasty; the electors being the clan chiefs, these latter in then own sphere being elected by the clans. A parliament or "feis" assembled triennially at Tard in which sat the princes, chiefs, judges, high priests, brehons and bards of the whole nation. This legislative body, one of the earliest known in history, revised the old laws and enacted new ones, very much as modern senates and assemblies did. On the introduction of Christianity by St. Patricius or Patrick in the fifth century, the existing code of laws was referred to a commission, consisting of one chief, one brehon and one Christian bishop, with a view to purging it of pagan ideas and adapting the statutes of Erin to Christian principles. The body of laws thus revised and codified are now, by order of the British government, being translated and published, as a rare and valuable treasury of ancient jurisprudence, parliament making an annual grant for the purpose ever since 1852. —Such was the constitution and polity which prevailed in Ireland down to the sixteenth century, a period of more than 2,000 years. From about the year 200 B. C. to A. D. 800, the Ireland of ancient history may be said to have attained its zenith of power and reputation. In the three centuries which followed the introduction of Christianity, the country was pre-eminently the great centre of scholastic and missionary enterprise in western Europe. To its free schools and universities flocked students from every part of christendom, and Irish missionaries and teachers spread throughout the known world. With the incursions of the fierce and savage Northmen or Danes, plundering and desolating hordes of pagan marauders, which began about the close of the eighth century, commenced the disorganization and wreck of the Milesian nation. These hordes, just then the scourge of western Europe, never were able to conquer the country as they did the neighboring island of Britain; but an intermittent war of utter barbarism, prolonged through 300 years, utterly demoralized it, and almost extinguished a civilization that had been the light of western Europe in its time. From A. D. 900 to A. D. 1170, with the exception of a brilliant interval of a few years under Brian I., who broke forever the Danish power, disintegration rapidly made way. The idea of a common national interest or a central national authority was almost totally discarded. Each sub-king fought for his own hand, and the post of Ard Ri was claimed by various competitors in reckless and exhausting contests that bathed the land in blood. —Meanwhile, England, that had yielded more or less easily to every invader, Saxon, Dane and Roman, once more received a new yoke. Its new conquerors were the Normans, who, fortunately for its future welfare, were strong enough to weld, albeit by ruthless process, the Danish, Saxon and British kingships and communities of England into a single political system. By the middle of the twelfth century the Normans had well consolidated their new kingdom, while Ireland had been steadily breaking into fragments. One of the Irish sub-kings, MacMurrough, prince of Leinster or Lagenia, revolting against the Ard-Ri, who had indeed deposed him, applied to Henry II. of England for help in his quarrel. Henry gave him permission to seek auxiliaries or mercenaries among the Norman English knights and free-lances. One of these, surnamed Strongbow, accepted MacMurrough's terms, and swiftly landing a powerful force on the Leinster shore, succeeded in restoring him to his principality. These Norman adventurers, brave, skillful and highly disciplined, saw a splendid opportunity for pushing their fortunes in the distracted and faction-torn condition of Ireland. They helped now one chief, now another, always on terms of payment highly advantageous to themselves, and soon their marvelous success and their daring ambition excited the jealousy and anger of King Henry. He called on them to return to England. Strongbow made various excuses for disobeying, and Henry, to the great satisfaction of the Irish princes, announced that he would proceed to Ireland in person to investigate the conduct of the Norman adventurers. He did so come to Ireland, and at once assumed the rôle of arbitrator or authoritative regulator of affairs, civil and ecclesiastical, pretending, as to the latter especially, that he had got a bull from his countryman, Pope Adrian, commissioning him to restore order in Ireland. The Irish princes did not quite realize all that this exercise of quasi-friendly offices involved, until long after Henry had returned to England. When they did, that is to say, when they found the Norman auxiliaries, one of their own body, converted into the garrison of a foreign king, they were dismayed. Some at once resisted; others diplomatized; a few submitted. Some felt the reality of the change; others did not. For centuries after the so-called "conquest" by Henry II. most of the native chiefs ruled their principalities or made war on one another, just as they did before a Norman had set foot on the Irish shore. Fitfully but gradually the Anglo-Normans pushed their power; but it was not until the close of the sixteenth century, or more than four hundred years after Henry's landing, that the struggle of native Irish sovereignty against English rule closed in the tacit surrender of Ireland to James I. —During the latter half of the last century of the above period, a new element of antagonism was imported into the conflict. Religious animosity was added to race hatred and national hostility. The English peers and people followed Henry VIII. into the reformation: followed Queen Mary out of it, and Queen Elizabeth into it again. The Irish, on the other hand, clung more devotedly than ever to the Catholic faith; a circumstance of contrast which has largely contributed ever since to keep the two peoples distinct, and which, allied with race influences and national traditions, marks each with a separate individuality. With the reign of James I. began the political system which, with little variation, still exists in the union of Ireland under one crown with Scotland and England. England came in by succession to the Scottish king, and by a remarkable coincidence or concurrence Ireland at the same moment virtually surrendered to the sovereignty of a Gaelic prince, sprung from a race kindred to its own. Throughout the whole Stuart period, from 1600 to 1700, the national feeling and actions of Ireland, with a loyalty fatal to Irish welfare, were displayed on the side of the dynasty thus accepted. In the victorious rebellion of the English republicans against the duplicity of Charles I., as well as in the still more successful English revolt against the despotism of James II., the Irish remained steadfast to the royalist cause; and, in the result, paid a dreadful penalty for such disastrous fidelity. The soil of the country was declared forfeit by the existing owners, and was parceled out as spoil among the soldiery of the Cromwellian and Williamite armies; hundreds of thousands of acres were bestowed on the mistresses and on the natural offspring of William and the early Hanoverian kings, while the native gentry, beggared and homeless, were banished and proscribed, and the general body of the people reduced to a condition little short of outlawry. Under what is known as the "penal code" from 1700 to 1775, the bulk of the population were forbidden to educate their children, to attend religious worship, to carry arms, to learn a trade, or to hold property. The schoolmaster and the priest had each a price on his head; and statutes of George I. and George II. went so far as to make it felony to send an Irish child abroad to receive the education forbidden at home. There was one circumstance, which, apart from the shocking barbarity of the "penal code," has made it rankle in the breasts of the Irish to the present hour; namely, that it was laid upon them in flagrant violation of a solemn treaty signed between the English and Irish commanders, duly countersigned by royal commissioners on king William's part, at the close of the Williamite struggle in 1691. Although the splendid army of Scandinavians, Dutch, Swiss, Prussians, Hugue-not-French and English, which the prince of Orange led into Ireland, had defeated the raw levies of the Irish royalists at the Boyne, and, more by happy accident than generalship, driven them from their position at Aughrim, he was again and again defeated before the walls of Limerick, which city was defended by Gen. Sarsefield, in command of the Irish armies of King James.41 At length, William, who was a brave soldier and a statesman, saw the wisdom of arranging terms with such a foe; and accordingly, on Oct. 3, 1691, articles of capitulation were negotiated, whereby the Irish army, retaining its arms, colors, bands and transport stores, marched out with the honors of war, free either to enter the service of King William or to sail for France where King James now resided as guest and ally of Louis XIV. The "civil articles" of the treaty of Limerick stipulated, in substance, that there was to be no proscription, no confiscation, no disarmament, and that the exercise of the Catholic religion should be as free as it had been in the reign of King Charles II. After the rough draft had been agreed upon, but before the fair copy was signed by Gen Sarsefield, the arrival of a French fleet with considerable aid in men, money and stores was announced to the Irish commander, and he was entreated not to sign the treaty; he replied, sorrowfully, that the news reached him an hour too late, that his honor and the honor of Ireland were pledged, and should not be broken. No sooner, however, had the Irish army sailed away to France than the treaty covenants, despite the protests and endeavors of King William, were cast to the winds. Angered at the idea of having no spoil by confiscation to divide, the anti-Stuart faction, now dominant in the Irish parliament, refused to approve the king's treaty, and, by stopping the supplies, compelled William to yield. Thereupon commenced the proscriptive legislation, known as the "penal code." The more severe these enactments grew, the more alarmed the dominant party became lest the Irish masses should rebel against them; and thus further and further severity was deemed necessary, as repression and alarm acted and reacted on one another. As a matter of fact, not even during the memorable Scottish risings of 1715 and 1745, which so nearly restored the Stuart line, did the Irish at home give pretext or justification for such a policy. The self-expatriated Irish battalions, however, now serving as an Irish brigade in the service of France, took heavy reprisals on the English power, confronting it on every battle-field, and deciding by their impetuous valor the fortunes of many an eventful day. At Fontenoy, fought May 11, 1745, by a French army of 45,000 men under Marshal Saxe, in presence of the king and the dauphin, against an English force of 65,000 men under the duke of Cumberland, victory was snatched from the British commander at the close of the day by a decisive charge of the Irish regiments. It was on the arrival of the dispatches which announced the fate of Fontenoy, that George II., much of a soldier and little of a bigot, is said to have exclaimed. "Curse upon the laws that deprive me of such subjects." —In the minds of many besides King George, a reaction against the terrible rigor of the "penal code" had, by this time, set in: and events were drawing near, which rendered its continuance impossible. According to the political constitution, which the Anglo Norman sovereigns conferred on their colony in Ireland, that country was annexed to the British crown, but not placed under the legislative action of the English parliament. On the contrary, it had a parliament of its own, supreme as to Irish affairs. When Henry VII. was strengthening his royal prerogative and generally centralizing his government, he had a statute passed by a subservient Anglo-Irish parliament at Drogheda, known as "Poynings Law," rendering the Irish parliament subject to the control of the English legislature The unconstitutionality of this law was always asserted, and "Poynings Act" was disregarded by Irish parliaments in the reigns of Charles I., Charles II. and James II. The Williamite parliament in London, however, from the first claimed the power to bind Ireland; a claim from time to time contested by jurists and public writers on the Irish side, who, though thoroughly Protestant, and attached to the new dynasty and the English connection, vehemently repudiated the idea of such subjection in legislative matters. The dispute was embittered by the manner in which the London government repressed Irish trade and manufactures. An address to William III., from English manufactures, complaining of too successful Irish competition, elicited from that monarch a remarkable promise that "he would do all that in him lay to discourage manufactures in Ireland." This royal pledge unhappily was only too well fulfilled. The Irish parliament of 1719, in the midst of its penal legislation against the conquered Catholics, openly resisted the doctrine of subordination. The Irish house of lords for bade the sheriff of Kildare to execute a decree of the English peers; whereupon the latter body retaliated by reaffirming "Poynings Law" in still more galling terms. The controversy, with little respite, went on up to 1775, when there rolled across the Atlantic a tocsin of liberty in the echoes of Bunker Hill. By this time a patriot party had appeared in the Irish parliament, a parliament in which no Catholic was allowed to sit, led by Lord Charlemont. Lord Kildare, Flood, Hussey-Burgh, Sir Lucius O'Brien and Ponsonby, later on by the man, the splendor of whose fame truly illumines this page of Ireland's history, the illustrious Henry Grattan. Encouraged by the conduct of the American colonists, they grappled boldly with the oppressions and corruptions of the government; their earliest efforts being devoted successfully to the liberation of Irish trade from the fetters that had crippled and well nigh destroyed it. They next claimed the restoration of the ancient freedom of the Irish parliament. King George and his cabinet resisted while they could, but the concession was inevitable. Sorely straitened by the effort to subjugate Washington and his colonial levies, the London government had to withdraw the troops from Ireland, which was now garrisoned and guarded by a national volunteer army of 150,000 men. The volunteers, who were citizens as well as soldiers, enthusiastically sustained the movements of Grattan. A thoroughly national spirit was aroused through out the island. The long-oppressed Catholic millions clasped hands with the long dominant Protestant colony or garrison. With the capitulation of the British armies to Washington and the recognition of American independence, vanished the last hope of successfully combating the Irish demand for a free parliament. A solemn treaty, in the form of a statute of the British parliament, 22 Geo. III., chap. 28, renounced "forever" the usurpation of "Poynings Law," and covenanted that the ancient constitutional right of Ireland to be bound only by laws of a free Irish parliament should henceforth be "unquestioned and unquestionable" The effect of this measure of national liberty seemed to be magical. In the ten years that followed, Irish trade and commerce expanded in a degree never known before or since. The spirit of tolerance also for a moment prevailed, and some of the most grievous of the penal laws were repealed. The country seemed to go forward on the road of progress by leaps and bounds under the guardianship of the free parliament won by Grattan and the volunteers. This great victory, as well as the previous recovery of commercial freedom, was long retarded by the restricted franchise and anomalous usages under which the parliament of the period was returned The representation of many boroughs was literally owned by aristocratic proprietors; and presentation to a seat in the house of commons was bought and sold like any other marketable title or commodity. The national party under Grattan now directed their attention to a reform of a system so fatal to public liberty. The British minister, on the other hand, the American war being over, had his hands free, and he determined to maintain a system which would enable him in a few years, by the expenditure of money in purchase of seats, to subvert all that Grattan had accomplished and overturn the treaty arrangement of 22 Geo. III, chap. 28. The struggle progressed for seven years with increasing earnestness on each side, when suddenly an event occurred which threw the great game totally into the hands of the British minister and swept the Irish popular party into a situation that proved disastrous. The French revolution of 1789 burst forth like the blaze of a tremendous conflagration. The governing classes all over Europe were stunned with horror and dismay. The friends of popular liberty hailed the event with joy. In Ireland, the property classes, flinging all other considerations aside, rallied to the side of governmental authority, so as to strengthen the bulwark against republican principles. The government, thus re-enforced, at once assumed a stern and haughty attitude toward anything in the nature of popular discontent or democratic manifestations. The Irish national reform movement, after struggling for a few years with such a state of things, eventually broke to pieces: its leaders differing widely on the new doctrines or principles launched in Paris. Some sided with the government, rather than embarrass the arm of authority at such a moment; others were for pushing the movement forward on still broader lines; while many. Grattan himself included, retired from the scene, as if foreseeing what was about to happen. The advanced section, driven from their open movement, all aflame with the new gospel of liberty, equality and fraternity, and infuriated by the English minister's design of betraying or subverting the settlement of 1782, enrolled themselves in a secret revolutionary conspiracy for the overthrow of British rule in Ireland. Although their main reliance was naturally on the bulk of the population, who were Catholics, the original founders and earliest adherents of the enterprise were Protestants; chiefly Ulster Presbyterians. Later on, men of all religious creeds, and unquestionably men of the purest motives and loftiest character, embraced the design. Lord Edward Fitzgerald, son of the duke of Leinster, was at the head of affairs; its ablest organizer, Theobald Wolfe Tone, being stationed in Paris as accredited agent or ambassador to the French directory. The government early discerned the advantage which an abortive insurrection would give them in persuading the property classes to "draw closer to the centre of power and authority" by consolidating the parliaments; and for a time the proceedings of the revolutionists were viewed with secret satisfaction. By the end of 1796, however, this feeling gave place to alarm when it was found that the French directory had determined seriously to assist the Irish party. This determination was made plain by the dispatch of a powerful expedition under Gen. Roche toward the close of the year. A storm dispersed Roche's flotilla, only a few vessels of which reached the bay of Bantry on the southwest coast of Ireland. The government now sought to force the hand of Lord Edward, by compelling him to take the field before another expedition could be prepared. To this end "martial law" was proclaimed, and shocking means were used to goad the populace quickly into a rising. While it was yet uncertain how far these tactics would succeed, an over whelming blow fell on the revolutionary party. Their central council or directory were surprised and seized in the very act of deliberating on the question of immediate operations; and a few days subsequently Lord Edward was captured, after a desperate struggle, in which he was mortally wounded. Less by concerted action than as an impulse of desperation, the insurrection now broke forth in four or five of the Irish counties—Antrim, Wexford, Wicklow, Kildare and Carlow. In Wexford the outburst was almost entirely the result of the forcing process above referred to. The people, half-armed and wholly undisciplined, took the field in rude array. Destitute as they were of military leaders, equipment or resources, they nevertheless through several months fought a fierce campaign which the entire available strength of the government forces barely sufficed eventually to subdue. Like all other bursts of popular passion this rising was marked by some lamentable excesses; or rather, in a struggle in which "no quarter for rebels" was the watchword on the one side, and in which discipline in the popular camp could be but slender, episodes of savage vengeance were in a sense inevitable. The rising in Ulster had been quickly and easily suppressed, and all the other counties of Ireland lay quiescent during the Wexford revolt. Disaffection and desire to rebel was intense; but a conviction prevailed that insurrection single-handed against Great Britain must absolutely fail, and another French expedition was expected. When it did arrive, under Gen. Humbert, who landed at Killala in the northwest of Ireland in August, 1798, with a force of a little over 1,000 men, the government was flushed with victory and the populace utterly overawed. Humbert defeated a force of nearly 5,000 opposing British troops at Castlebar; but eventually had to surrender to an overwhelming force under Lord Cornwallis. The after-scenes of this insurrection were barely less tragic than the struggle in the field. The scaffold and the executioner long plied their dreadful work, completing what the fusillade began. It was at such a moment Pitt produced his long meditated scheme for breaking the treaty of 1782, and abolishing the Irish parliament. Even amid the gloomy horrors of 1799 his proposal was at first defeated in the Irish parliament; the constitutional nationalists under Grattan, Curran, Charlemont, Parnell, Ponsonby and Plunkett making a last desperate effort of resistance. By the next year, however, Pitt had expended nearly £2,000,000 in buying up what were called "proprietary boroughs," and otherwise purchasing votes sufficient to secure a majority, and in 1800 his scheme of "union" was carried through. By this time Bonaparte had become the terror, as he subsequently very nearly became the conqueror of Europe. England alone successfully defied and victoriously encountered him. On English soil alone it may be said constitutional government for the time dared to exist in the old hemisphere. For fifteen years all other political issues seemed abandoned or forgotten in view of the titanic struggle which culminated and closed at Waterloo. Beyond a madly hopeless attempt of the youthful enthusiast, Robert Emmett, in 1803, to renew the insurrectionary enterprise of 1798, Ireland may be said to have lain sullenly dormant, through the eventful years that saw the meteoric course of Napoleon. When next an Irish question challenged public attention, new elements of political power, new leaders, new tactics, came into view. Hitherto the Irish Catholics, nine-tenths of the population, being for-bidden the rights of citizenship, had to depend for public advocacy on those noble-minded Protestants, like Grattan and Curran and Parnell, who, from a pure love of justice, espoused their cause. The Ireland which had legal or political existence in the eighteenth century was merely the handful of Anglo-Irish Protestants settled in the country. The millions of Celtic bondsmen around them counted for nothing in the state, except as material for taxation. The bondsmen now arose and strode into the political arena to determine their own fortunes. The political Ireland that appeared with the nineteenth century was a Celtic Ireland; or, rather, an Ireland that excluded none and embraced all Irish-born men of whatever race or class or creed. The question of Catholic emancipation had early enlisted the efforts of Grattan and other of the Protestant patriot leaders in Ireland; and even in 1799 had made such way in England that Pitt pledged himself to make it one of the first measures the united parliament would pass. George III. absolutely refused, however, to entertain the question, and it was put aside. Forth from the ranks of the Irish Catholics there came a leader of their own race and faith destined to make king and cabinet alike feel his power. This was Daniel O'Connell, who, for nearly half a century, was the foremost political figure in Irish history. He aroused and combined the masses of the people; he covered the country with the network of a vast organization, and soon six millions of people, fired with enthusiasm and determined to be free, were disciplined to obey his will. The government sternly combated the movement; forbade it, proclaimed it, persecuted it, punished it—all in vain. O'Connell was no sooner suppressed in one shape than he reappeared in another. Again and again the king and the government declared that no concession could be made to demagogues and agitators; that the law would be vindicated, and established institutions in church and state upheld. Although no actual outbreak occurred, the state of affairs in Ireland was critical in the extreme. In 1829 the duke of Wellington, who had taken office expressly on a pledge of opposition to emancipation, announced to the king that it was a choice between its concession or civil war, civil war in which a vast body of English popular opinion would side with the Irish people and in which the Irish regiments of the army dare not be called upon to act against their countrymen. King, cabinet and parliament forthwith saw the question in a new light, and the penal code was in effect expunged from the statute book. From this period may be said to date a series of efforts on the part of British statesmen to grapple with the more prominent or pressing of Irish grievances; seldom or never, however, until popular complaint of them, long neglected or resisted, had developed into disorder, disaffection and violence. Between 1829 and 1835 the country was convulsed with a struggle against "tithes." The Protestant clergy were authorized to levy on the agricultural inhabitants, nearly all of them Catholics, a tenth of the produce of the land. After three or four years of stormy agitation, disfigured by deplorable outrage and violence, the people at length combined in a national "strike" against tithes. This proved effectual. A law was passed abolishing tithes in form; that is to say, adding them to the landlords' rent, and compelling the landlord, to whom the amount was paid in rent, to pay it over to the clergy minus 25 per cent. for the trouble of collection. These victories encouraged O'Connell to undertake an enterprise more serious and more formidable than any he had yet attempted, namely, an endeavor to recover the separate parliamentary constitution of Ireland subverted by Pitt in 1800, or, as it was called, to "repeal the union." The Irish masses were now full of confidence in the ability of their leader to accomplish anything he took in hand. Their social and physical condition was still painfully low. The grinding exactions of exorbitant land rent left the agricultural population, as a royal commission of inquiry under Lord Devon declared them to be, "the worst housed, the worst fed and the worst clad peasantry in Europe." They retained, however, the hopeful buoyancy of their Celtic nature, and the marvelous success of the total abstinence or "temperance" movement under Father Mathew (a Catholic priest of Cork city) had enormously elevated their morale. The abolition of the Irish parliament in 1800 had at the time been vehemently resisted by the ultra-Protestant party in Ireland; but when, in 1840. O'Connell, the Catholic leader, took up the question of its recovery, it was found that their attitude had totally changed. The parliament an 1 the nation which they had contended for was one from which papists were excluded. So far from favoring legislative restoration now that the Catholics had been emancipated, they ardently implored the government to maintain the union, and not to deliver them up to "popish ascendency." O'Connell's movement, therefore, though it was sustained by more than three-fourths of the people of Ireland, encountered from the outset the mistrust, the dread or the hostility of the Irish Protestants. The full power of England was pledged to oppose it as an at tempt to dismember the empire. The Irish leader found himself in a critical position. The government, so far from yielding to the popular demand, plainly meant to encounter it by force. Were England engaged at that moment in any serious foreign complication, concession would have been inevitable. But never in her history was she more great, more powerful or more strong. She was at peace with all foreign nations, and, possessed of a giant's strength, was ready to use it in stamping out once and forever this dangerous Irish idea of national autonomy. O'Connell's embarrassment was all the greater because there had now grown up around him a race of young men who scorned his exaggerated love of the peaceful ways of moral suasion, and who held the lawfulness of Ireland recovering the rights she claimed by armed resort if practicable. This conflict between the "moral force" and "physical force" principles of what were called respectively the "Old Ireland" and "Young Ireland" parties, rent the great Irish movement in twain. In the midst of the controversy there fell on the country a calamity that buried all political though or effort for the time. This was the Irish famine of 1847-9. In the autumn of 1846 the potato crop, which formed almost the sole support of the population, was struck with blight and rotted in the ground. All could see the awful consequences that were at hand; yet the action of the government was disastrously tardy, circumlocutory, blundering and impotent. The people perished in hundreds of thousands amid scenes of anguish and horror beyond human power adequately to portray. Howsoever culpable the inefficient action of the government in coping with the difficulty, the conduct of the English people was truly noble. They poured princely subscriptions into the treasuries of various relief associations, and did the best that private effort could achieve to mitigate the dreadful affliction. Nearly every country in the world joined in the Samaritan endeavor; but foremost and first—far outstripping all the rest, England included—was the land that long had been the free asylum and happy home of expatriated Irishmen, the United States of America—O'Connell died, aged and heart-broken, in May, 1847. In February, 1848, revolution in Paris once more sent the impulse of insurrection through Europe; and once more Ireland yielded to its influence. The Young Ireland party took the field, or rather vainly attempted to do so, under William Smith O'Brien. The leaders of this abortive movement were everything but good revolutionists. They were men of genius, poets, scholars artists, orators; men of the purest and loftiest aims, fired with the generous enthusiasm of youth, maddened by the famine scenes around them. But they were utterly incompetent as military conspirators, and their attempt broke down on the threshold. It cost Ireland, however, a heavy penalty in the dispersion of a school of intellectual culture and activity, even the early-checked labors of which have left a deep imprint on the literature and the politics of that country. There followed upon the famine of 1847 and the abortive insurrection of 1848, a period of utter prostration. To the dreadful havoc of the famine there was now added wholesale eviction and expatriation of the ruined tenantry. In many parts of the island "clearances," as they were called, swept away the entire human population of the district, in order that vast bullock-ranges, sheep runs or grouse-moors might take the place of homesteads and villages. The human suffering involved in this policy can only be estimated by those who know how passionately the Irish peasant clings to the spot, however humble, which has been the birthplace and the home of his forefathers. In truth, the eviction scenes of that period, 1849 to 1860, rendered inevitable the events that have convulsed Irish society for the last twenty years. Hundreds of thousands of the eviction victims perished by the roadsides or in the pauper barracks. Other hundreds of thousands fled or were deported to America. They went with bursting hearts, ready to embrace any enterprise, no matter how wild and hopeless, that promised vengeance on the power that had driven them forth. As early as 1858 some of the exiled Young Ireland leaders conceived the idea of utilizing for revolutionary purposes this feeling on the part of the American Irish. The result was the organization of the Fenian conspiracy by Mr. James Stephens and Col. John O'Mahoney. Keenly alive to the causes of failure in 1848, the Fenian leaders aimed at careful preparation and extensive military organization. Notwithstanding the strong opposition of the Catholic clergy, and the dissuasions or protests of those nationalists who believed insurrection impracticable and mischievous, they pushed their enrollment with intense ardor and earnestness, and succeeded in establishing the most wide-spread and formidable revolutionary movement known in Irish history since 1798. In armament they were utterly deficient, but their organization and discipline were on the whole remarkably perfect. The government throughout was kept well informed by its spies in the conspiracy, and in 1865 swooped suddenly down on the leaders in Dublin, seizing the subordinates simultaneously all over the country. The organization never recovered from this fatal blow, although for fully two years subsequently it made desperate and persistent efforts to reconstitute itself, and at length, in March, 1867, gave the signal for a national uprising. The moment the long formidable secret society came out into the open, its great spell was shattered. It was found to be just as deficient as the much-blamed Young Ireland movement of 1848 in the most elementary conditions of military existence. The fortitude, devotion and heroism exhibited by its members in the dock and in the dungeon enlisted for them the sympathy of thousands who had condemned that enterprise; and even among English statesmen the feeling spread that the Irish question must be dealt with by remedial, not by repressive, measures. Mr. Gladstone, as leader of the liberal party of England, gave eloquent expression to this conviction; and announced that, to begin with, the Irish state church, as a badge of conquest and an oppressive burden. must be swept away. In the general election of 1868 he was returned to office with an enormous majority, and, well fulfilling his promise, he forth with carried through parliament an act for disendowing and disestablishing the Irish Protestant state church. Practically, the measure was one of disestablishment alone; for as to endowment, he was able so skillfully to arrange the financial portion of his scheme that not a shilling less income than before was secured to the church. This reform be followed up in 1870 by an act which aimed at settling the still more important and much more exigent question of land tenure in Ireland. The latter attempt fell lamentably short of the real necessities of the situation; a short-coming which occasioned great disappointment Meanwhile, in the twelvemonth that followed on the disestablishment of the church, there ensued the most remarkable transformation ever witnessed in Irish politics. The Protestant "conservative" party—peers and commoners, land lords, merchants and aristocrats—reached out hands to the Catholic millions, and openly offered to join them in a national movement for the restoration of Irish parliamentary independence. This, no doubt, was in some degree through resentment on their part against England for selfishly throwing them over and repealing the union between the churches. But it was also largely through genuine conviction that a wise compromise between total separation by rebellion, and national extinction by the domination of the London parliament, ought to be presented to a people so plainly determined not to acquiesce in the existing state of things. Mr. Isaac Butt, an Irish Protestant barrister of great eminence, may be said to have negotiated the remarkable alliance or fusion of parties, creeds and sections, which, under the name of the "Irish Home Rule Association," made its appearance in 1870. The programme of this movement was, on the one hand, reconciliation between Catholic and Protestant Irishmen, between peers and peasants, liberals and conservatives; and, on the other, reconciliation between Ireland and England, on the basis of a federal union, whereby Ireland should enjoy such legislative and administrative autonomy as is possessed by a state in the American republic. Even among the Fenian or separatist party this experiment was favorably regarded as presenting the minimum of a satisfactory compromise, and in a few years the movement took such hold on Irish public opinion that, tried by every test known to constitutional countries—parliamentary, municipal and township elections—the national will has, ever since, year by year, with more and more determination declared itself for "Home Rule," as the scheme is called. In 1872 the old system of election procedure was replaced by ballot-voting, whereby for the first time the Irish people were enabled freely to manifest their views in the election of representatives. In the next following general election of members to the imperial parliament in 1874, the home rule party carried fifty-seven out of one hundred and three Irish seats. In the elections of 1880 they carried sixty-five, and it is computed that on the next occasion they will return at least seventy five or eighty members. Despite the strong parliamentary majority from Ireland in favor of national autonomy, the cabinet of Mr. Disraeli in 1874, and down to 1880, backed by their powerful following in parliament, imperiously refused every measure of reform or amelioration which the Irish party demanded. With especial earnestness and perseverance the Irish members year by year besought the government to deal with the land question as one which might any day lead to a catastrophe. Their warnings were disregarded; their efforts at remedial legislation were haughtily overborne by enormous majorities of British and Scotch votes. In 1878 the harvest was a failure in Ireland and in England. In 1879 it was almost a total loss in the former country; and a gloom of terror darkened the land. A repetition of 1847 seemed at hand. Now, however, there was seen a startling change in the spirit and action of the people, as compared with their conduct in that year. In stern and resolute tones they announced that the subsistence of a toiling population was a first charge on the land, and on the earliest whisper of landlord preparations for a gigantic eviction campaign, the whole island sprang to action with a cry that the hour had come when feudal landlordism must-fall. Throughout 1880 and 1881 there raged in Ireland a fierce and implacable social war, with such evil concomitants of incidental disorder, violence and outrage as usually attend upon popular convulsions Mr. Gladstone and the liberal party were restored once more to power by the general election of 1880 In 1881 the great English statesman took the Irish question in hand; bringing in a coercion bill in January, and a land bill in April of that year. The former added fuel to the flame in Ireland, by its Draconian severity, exceeding anything known outside of Russia. The land bill, on the other hand, was a measure of noble and comprehensive character. It did not "disendow and disestablish" Irish landlordism, but it stripped it of the despotic power it had so mercilessly and disastrously used in the past. Justly irritated by the coercion act, and bitterly disappointed that the new land law did not wholly abolish landlordism, the Irish tenant-farmers at first received the latter measure in a sullen and almost hostile temper. The disposition manifested by Mr Gladstone, however, in 1882, to supplement its beneficent provisions wherever needful, and the growing conviction that the measure could be worked so as to accomplish before many years the gradual establishment of a "peasant proprietary," may be said to have brought the people of Ireland to recognize in the land act of 1881 a charter of liberty and a guarantee of a peaceful and happy future. —The character, temperament and habits of the Irish people have naturally been influenced by the vicissitudes of their stormy history. Among the peasantry the regretable effects of their furtive life in the penal times can even still be discovered in various ways. It is only within the past half century that the two races—the Anglo-Irish and Celtic Irish—have fused in any marked degree. The people are brave, naturally quick-witted and intelligent hardy, laborious, inured to toil, patient in privation, hospitable, warm in their affection, devoted in their fidelity to friends; but dangerously fierce and quick in anger, easily aroused and quickly allayed. Their deeply religious fervor and their passionate love of country are perhaps the most prominent traits in their character. In public life they are capable of great achievements under the influence of enthusiasm, hope or confidence; but are impatient of results, exhibit a lack of plodding perseverance and cool, methodical action. In fine, the buoyant and volatile temperament of the Celt largely prevails; yet their more extensive intercourse with other peoples of late has considerably developed in them a steadiness and seriousness of purpose which has attracted general attention. Since 1830 education has made great progress among the Irish people; and their material condition has on the whole been vastly improved; but the start was from a point painfully low. It must be long before they can fully recover from the dreadful effects of those not remote centuries during which education was "felony by law." Throughout the period that gave to English literature the works of Spenser, Shakspeare, Milton, Bacon and "Rare Ben Johnson," of Dryden, Pope and Addison—the period during which it may be said the intellect of the modern English nation was being formed and cultivated and its civilization moulded and refined—Ireland was having the eyes of the mind put out, and intellectual blindness and habits and tastes of barbarism forced upon her. That dreadful policy has been abandoned, and at length the Irish race are being allowed access to the blessings of education. Between 1831 and 1840 a system of primary schools was established by the government, which, although ill recommended in many respects to popular confidence and favor, has been almost universally availed of; it may now be said that in every cottage in Ireland the school and the printing press have wrought or are working a marvelous revolution. —Despite all disadvantages, Ireland makes a goodly show on the roll of scholars, poets, authors, sarants, soldiers and statesmen of the world. Swift, Goldsmith, Sheridan, Moore, Banin, Griffin, Carleton and Lever, in literature; Burke, Grattan, Curran, Plunkett, Richard Lalor Shiel, O'Connell, Duffy, Magee (bishop of Peterborough), Butt and Lord Dufferin, in oratory, statesmanship and politics, are familiar names. In the last generation Wellington, and in the present the only two capable generals England has in command, Sir Garnet Wolseley and Gen. Roberts, have been contributed by Ireland. Hogan, Foley, McDowell and Farrell, as sculptors; Maclise and O'Connor, as painters; Balfe and Wallace, as musical composers; Prof. Tyndall and Dr. Haughton, as scientists—all Irishmen, are honorably known. The two most competent historians of our own times in the English language, Mr. Lecky and Mr. Justin McCarthy, are Irishmen. In the camps and courts and cabinets of friendly foreign states, from Vienna to Madrid, and from Paris to St. Petersburg, men of Irish race have long been marked to eminence and fame. Finally, it may be said that the labor, industry and enterprise of Irishmen have largely contributed to the prosperity and power of those comparatively new states in the western and southern hemispheres that promise to exercise potential influence on the future of the world.—(See GREAT BRITAIN.) A. M. SULLIVAN, M. P. ITALYITALY, Kingdom of. I. Unification. The kingdom of Italy has an area of 114, 296 square miles, with a population of 28,200,000 (26,801,154, census of 1871), or 237 inhabitants to the square mile, with an increase of 7.1 per cent. every ten years. On Dec. 31, 1861, the average population per square kilometre was 84, with an excess of males over females in the proportion of 1,000 to 996. In 1882 the population per English square mile was 248. We shall relate succinctly the events which preceded the establishment of the kingdom of Italy, up to the time of Rome becoming the capital. Before 1859 the provinces which now compose this kingdom were grouped into several states After a fortunate war with Austria, the French and Sardinian troops, the latter re-enforced by volunteers from all Italy, expelled the Austrians from Lombardy. July 11, 1859, in the preliminary treaty of Villafranca (on the Mincio) the emperor of Austria ceded that province to the emperor of the French, who made it over to the king of Sardinia. The annexation of these provinces to Sardinia had been already voted by 561,002 in favor of it to 681 against it, in the plebiscitum of June 8, 1848, the effects of which had been suspended by the victories of the Austrian armies, and the reoccupation of the country which followed them. The preliminaries of Villafranca were ratified at Zurich by the treaty bearing the name of that city, and the date of Nov. 10, 1859. —While the struggle was going on in Lombardy, Tuscany, Parma and Modena and the northeastern portion of the States of the Church rose in insurrection. The grand duchy of Tuscany and the duchy of Modena were governed by the sovereigns of the house of Hapsburg Lorraine; at Parma reigned a branch of the Spanish bourbons. In the month of September. 1859, four bodies, elected by universal suffrage, met at Florence, at Parma, at Modena and at Bologna; these voted, 1, the abolition of their old form of government; 2, annexation to the kingdom of Sardinia, under the constitutional monarchy of Victor Emmanuel II. of the house of Savoy. These unanimous decisions of the four assemblies were submitted to a direct vote of the people in March, 1860. They were ratified by 792,577 votes, out of 807,502 votes cast. This vote of annexation was accepted by the king of Sardinia, upon whom his old parliament had conferred full powers, April 23, 1859. The annexation of Parma, Modena and the northeastern portion of the States of the Church which had been united under a provisional government, was decreed March 18, 1860; that of Tuscany, the 22d of the same month. At the same time the election of deputies was proceeded with, who were to represent the annexed provinces in the parliament of Sardinia. The elections took place Feb. 29, 1860. Parliament opened at Turin, April 2, and again ratified the annexation vote in its session of April 13. —The old kingdom of Sardinia (which had before the war 5,000,000 inhabitants, and from which Savoy and the arrondissement of Nice had been detached by the treaty of March 24, approved by the law of June 11, 1860, and followed by the annexation vote,) contained, including the annexed provinces, a population of 11,000,000 in June, 1860. —But the march of events did not stop here. In various parts of Sicily feeble attempts at insurrection took place, which failed. A few bands of insurgents sustained themselves in that island, when Gen. Garibaldi, who had distinguished himself in the war of the preceding year, embarked with 1,000 volunteers at Genoa, May 5, 1860, on two merchant steamers. He ran the gauntlet of the Neapolitan cruisers, and disembarked under their fire at Marsala, Sicily. on May 11. Upon reaching land, he formally took possession of the government of the island, in the name of Victor Emmanuel II., king of Italy. May 15, 1860, there was a bloody fight at Calatafini, where the troops of the king of Naples were repulsed After a series of fights and marches, Garibaldi entered Palermo, the capital of the island, the garrison having capitulated June 5. Of the royal troops there remained only a garrison in the citadel of Messina, when Garibaldi descended into Calabria. Aug. 21. Sept. 7, 1860, he became master of Naples, without firing a shot. —While this was taking place in the south, the corps of the royal army of Sardinia advanced through Roman territory, in which was assembled a corps under the orders of General Lamorciére. After the battle of Castelfidardo, (Sept. 18, 1860), the pontifical army was dispersed. The garrison of Ancona sustained a siege by land and sea for some days. On the 29th of the month it was forced to surrender. —The army, with King Victor Emmanuel himself at its head, next advanced to ward the frontiers of the old kingdom of Naples Oct. 17 there was a skirmish at Isernia, and on the 26th, one at Teano. Several bloody fights had taken place between Garibaldi's volunteers and the Neapolitan troops, in the country surrounding Capua, then in a state of siege. This city surrendered on Nov. 2, and King Victor Emmanuel entered Naples on the 7th. Francis II. had shut himself up in the stronghold of Gaëta, with a very respectable army; the garrisons of Civitella del Tronto, in Abruzzo, and of Messina still held out for him; Gaëta surrendered Jan. 13, Messina on the same day, and the citadel of Civitella del Tronto on March 20, 1861. —While these military movements were taking place, the people of Marches, Umbria, Naples and Sicily came together Oct. 21, 1860, to decide upon a form of government. The plebiscitum of Marches pronounced in favor of their annexation to the constitutional monarchy of Victor Emmanuel, king of Sardinia, by 133,077 against 1,212 votes. The plebiscitum of Umbria gave 97,040 votes for and 380 against annexation. In the plebiscitum of Naples and Sicily the Italian formula was adopted, "one and indivisible," under King Victor Emmanuel and his legitimate descendants. This formula obtained 1,302,064 votes in the Neapolitan provinces, and 432,053 in Sicily, or, in all, 1,734,117 votes against 10,979. The king, to whom parliament had given full power in the matter, in the sessions of Oct. 31 and Dec. 3, 1860, accepted these plebiscita, and sanctioned the uniting of these provinces into one state by royal decree, Dec. 17. Jan. 23, new general elections were held. Parliament assembled at Turin, Feb. 17, and one month after (March 17, 1861) was cast the vote of the two chambers, proclaiming the kingdom of Italy, with a population then of 21,776,953. Count Camille de Cavour, Victor Emmanuel's first minister, the mighty inspirer of the policy which resulted in the unity of Italy, died June 6 Baron Bettino Ricasoli, who had been dictator in Tuscany, before the annexation of that province to Sardinia, and who formed a new ministry, succeeded him. Baron Ricasoli, resigned March 2, 1862. His successor was M. Urban Ratazzi, head of a new ministry, which lasted until Dec. 8. Then still another was formed, under the leadership of Louis Charles Farini, formerly dictator in the provinces of Parma. Modena and the northeastern part of the States of the Church. M. Farini retired March 24, and the leadership of the ministerial council devolved upon M. Mark Minghetti, minister of finance. —Since 1849 France had maintained an armed force at Rome: by a treaty signed at Paris Sept. 15, 1864, between the two governments of France and Italy, it was stipulated that France should withdraw her troops as fast as the organization of the army of the pope could be proceeded with; the evacuation to take place. however. within two years. Italy agreed, on her part, not to attack the pope's territory. and even to repel any attack upon it from without, and she became responsible for a proportionate part of the debt of the old States of the Church. By a subsequent agreement the Italian government engaged to transfer the capital of the kingdom from Turin to Florence. Unfortunately things had not gone smoothly nor without bloodshed at Turin The ministry led by M. Minghetti gave place, Sept. 24, to a new administration directed by Gen. La Marmora The transfer of the seat of government to Florence was nevertheless sanctioned by the law of Dec. 11, 1864. The central administrations began to remove toward the middle of the following year. Parliament was opened Nov. 18, 1865, in the new capital of the kingdom. —June 17, 1866, war having broken out between Prussia and Austria, Italy, which had bound itself to Prussia by a secret treaty. declared war against Austria. After the battles of Sadowa in Bohemia, and Custozza in Italy, hostilities were suspended. July 5, the emperor of Austria ceded Venetia to the French emperor, who declared that it had been taken from Italy, and should be restored to her in time of peace. There were held negotiations on the part of Italy, for the cession of Trentin, or Tyrolean Italy, which came to naught. The treaty of peace between Austria and Prussia was signed Aug. 23, 1866, and between Austria and Italy, Oct 3 of the same year. As the consent of the people to these measures had been stipulated, they were consulted Oct. 21 and 22, and gave 647.246 votes for union with the kingdom of Italy. and 69 against. The annexation of Venetia was sanctioned by royal decree, Nov. 4, 1866, and ratified by the law of July 18, 1867. —The Ricasoli ministry, which had succeeded the La Marmora government at the breaking out of hostilities, handed in their resignations, April 4, 1867. A new ministry under Ratazzi succeeded it. The evacuation of the pontifical states, stipulated in the agreement of Sept. 24, 1864, had been accomplished within the specified time. In September, 1867, Gen. Garibaldi proposed to attack them with bands of volunteers; the royal government not succeeding in preventing an armed invasion. the French interfered, and the Garibaldians were defeated and put to rout at Mentana, (Nov. 3, 1867). From the effect of these events the Ratazzi ministry had fallen. Gen. Menabrea became chief of the new cabinet, appointed Oct. 24, and which remained in power until Dec. 14, 1869 From that time until July, 1873, the administration was intrusted to the Sanza ministry Then it passed into the hands of the Minghetti ministry, which embraced several members of the former cabinet. —In 1870 war broke out between France and Prussia. After the first disasters France recalled her troops from Rome. Passion ran high; the national will clamored loudly for Rome, its natural capital. Parliament had already unanimously recognized it as such, March. 1861. A new outbreak was inevitable, an armed repression would only have arrayed the government against the country, and would perhaps have been unsuccessful. A plenipotentiary was sent to negotiate with the pope. but could come to no agreement with him. Then a division. commanded by Gen. Cadorna, advanced upon Rome; the assault was made Sept. 20. A breach was already opened when the foreign troops forming the pontifical army capitulated. —Oct. 2, 1870, the Roman plebiscitum was held, which resulted in 133, 681 for, and 1,507 against. A royal decree of Oct. 9, 1870, declared Rome and its provinces integral parts of the kingdom; it guaranteed to the pope his dignity, inviolability, the personal prerogatives due to a sovereign, and reserved the right to establish, by a special law, the necessary guarantees for the independence of the holy father, and the exercise of the spiritual authority of the holy see. The annexation of Rome and its provinces was ratified by law, Dec. 31, 1870. The guarantees of the holy father and the holy see were sanctioned by the law of May 13, 1871. The removal of the government to Rome was decreed by law, Feb. 3, 1871. The new legislature, the eleventh since the promulgation of the constitutional statute by Charles Albert, king of Sardinia, the fourth since the proclamation of the kingdom of Italy, began its session there Nov. 27, 1871. —II. Constitution. The charter, granted by Charles Albert, March 4, 1848, to the kingdom of Sardinia, was accepted the same year in Lombardy by the "act of fusion." It was also accepted by the plebiscita, which we have just referred to. This charter is therefore the constitutional charter of the kingdom of Italy. The following are its provisions: The government is monarchical and representative; the succession is regulated by the salic law. The king attains his majority at the age of eighteen During his minority the regency devolves upon his nearest male relative; or, male relatives failing, upon the queen mother. At the commencement of each reign, and for its entire duration, the civil list is fixed by vote of parliament. The old dotation in the state budget was augmented after the proclamation of the kingdom of Italy. Later it was reduced, by consent of the king, and is now (1882) 16,250,000 francs. The dotation of the crown, not personal property. consists of villas, palaces and castles. The allowances of the princes of the royal family amounted to 1,600,000 francs in 1873. The legistive power is divided between the king and the two chambers, the senate and chamber of deputies. The construction of the laws is also within the province of the legislative power. The executive power belongs to the king, who has supreme command of the army, declares war, makes treaties of peace, of alliance and of commerce, with the assent of the chambers, when they involve special expense or changes in the territory of the state. The king appoints responsible ministers. and no act of the king is valid unless countersigned by one of these. The king appoints also to all the offices of state, gives his sanction to laws, and sees to their execution. He has the right of pardon. The two chambers are convoked each year by the king. He can prorogue them, and can even dissolve the chamber of deputies. But in the latter case he must call a new one within three months. The initiative in the making of laws belongs to the two chambers as well as to the king. Nevertheless, all laws imposing taxes must first be passed by the chamber of deputies. The Catholic religion, professed by the vast majority of the citizens, is the religion of the state; other religions are tolerated. Nevertheless, the principle of toleration toward dissenting religions is in reality liberty of conscience. All citizens are equal before the law; they enjoy the same civil and political rights, and must contribute to the expenses of the state in proportion to their means. Personal liberty is guaranteed; domicile is inviolable, the press is free, and the right of assembly acknowledged Property is inviolable, save in the case of the exercise of the right of eminent domain. when damages are allowed. Taxes can only be imposed by law, and every citizen has the right to petition the chambers. The princes of the royal family are senators, with the right of a seat in the senate at the age of twenty-one; they vote at the age of twenty-five. The other senators. to an unlimited number, are appointed for life by the king. They must be at least forty years old. Senators are appointed from among bishops, archbishops. deputies, ministers, ambassadors, magistrates of the court of appeals, general officers; councilors of state and chancellors of the exchequer: prefects; men who have done honor in any way to their country; and those who pay more than 3,000 francs direct taxes. In 1880 the senate was composed of 270 members. The senate is the high court of justice, for the trial of crimes of high treason, and of ministers impeached by the chamber of deputies. To be a deputy, a person must be a citizen of the kingdom in the full exercise of his civil and political rights, and must have completed his thirtieth year. The deputy's term of office is five years. The chamber of deputies alone has the right to impeach ministers. The two chambers sit at the same time. Each chamber governs itself. Senators and deputies are not salaried The sessions are public. Resolutions are adopted by an absolute majority of votes. Members of the two chambers can not be held accountable for opinions delivered or votes cast during session. Each chamber judges of the validity of the nomination or election of its members. At each new session the president and vice presidents of the senate are appointed by the king. The other members of the board of officers are elected by the senators. The chamber of deputies names its own board of officers, including the president. Except in case of flagrante delicto, a senator can not be arrested. It is the same with the deputies, during the session of the chamber. Nevertheless, the two chambers can consent to the arrest of their members at the request of judicial authority. Both senators and deputies take before their respective chambers the oath of fidelity to king, country and laws. Judges and magistrates are appointed by the king; they are irremovable three years after their nomination. There can be no special courts nor jurisdiction. Sessions of courts are public. —Such are the general principles of the constitution of the kingdom of Italy, embodied in the statute granted March 4, 1848. The electoral law proclaimed shortly after the statute of March 4. gave one deputy to every 25,000 inhabitants, which made 204 deputies for the old kingdom of Sardinia. After the annexation of Lombardy, a law of Nov. 20, 1859, modified this proportion, and provided for one deputy to every 30,000 inhabitants; so that there were, after the other annexations from central Italy, 387 deputies. After the plebiscita of 1860, the proportion was changed again, and it is now (1882) one deputy to every 40,000 inhabitants. After the annexation of Venetia and Rome the number of deputies increased. In 1873 it was 507, and in 1880, 508. To enjoy the electoral right, one must be a citizen by birth or naturalization, be twenty-five years of age, and know how to read and write. The electors of certain provinces, designated in the electoral law, are provisionally exempt from compliance with this last condition. Electors must, besides, pay forty francs annually in direct taxes, or pay for the hiring of a location for the carrying on of commerce, art, or some business, a fixed rent, varying, however, according to the population of the communes where the industry is established. —The conditions of the electoral law are not imposed upon the following persons: members of academies; members of chambers of industry and commerce; professors of arts, sciences and letters; civil and military employés; persons decorated with a national order; laureates of universities; persons exercising the liberal professions; and brokers approved by the government. Nor are the above conditions necessary to eligibility to the position of deputy; the exercise of civil and political rights and to be thirty years of age are sufficient Functionaries and employés paid by the state are not eligible. Nevertheless, functionaries and employés belonging to the following categories can be admitted to the chamber of deputies. to the extent of one fifth of the whole number. Ministers of state. who are not counted in this fifth, and secretaries general of the ministries; members of the council of state, and of the courts of cassation and appeal. to the exclusion of those charged with the administration of public affairs, superior officers of the army and navy. provided they be elected outside of the district of their command: members of the superior council of public instruction, public health, public works and mines: finally, professors in universities. The members of the clergy are not eligible when they have charge of souls or a fixed residence, for example, bishops, vicars, chapter-canons, etc. —The electoral lists are prepared by the municipalities. and they are subjected to annual revision by the same authority. Those interested may object to the formation of these lists; in case of refusal on the part of the municipalities to right the matter, the person so objecting can petition the court of appeals. Each electoral college may be divided into several sections. The electoral colleges are convoked by royal decree. within three months from the expiration of the quinquennial mandate, or of the dissolution of the chamber, within one month, in case of vacancy by death, resignation or any other cause. To be elected on the first ballot, the candidate must get a number of votes equal to one-third of the electors registered. and one-half of those voting In default of which, eight days after, those two candidates are voted for who obtained the highest number of votes the first time In both cases the president of the board of officers proclaims the deputy elected. provided it be ratified by the chamber, to which are now sent his credentials, together with protests and objections, if there be any. —III. Administration. The executive power belongs to the king. who wields it through nine responsible ministers, to wit. Minister of foreign affairs; of the interior; of finance; of pardon, justice and worship; of public instruction; of war; of the navy. of public works; of agriculture. industry and commerce. One of these ministers presides at the meetings of the ministries. The powers and privileges of each are determined by law Nearly the whole system of administrative laws has been renewed since the foundation of the kingdom of Italy. On March 20, 1865, were enacted the laws for the administration of communes and provinces, public safety, public health, the council of state and public works. From April 29. 1869, dates the law for the administration and general accountability of the state. The executive power is based upon a council of state, which has a consulting voice in all affairs referred to it by ministers, or which are within its province by law. The administration decides no legal controversies. Its power to do so was abolished by law, March 20, 1863. Every question of a civil or political right, even where the state is interested, is within the province of the ordinary courts. The council of state is called on to settle controversies concerning jurisdiction. —The kingdom is divided into 69 provinces; these are subdivided into 274 arrondissements, and the arrondissements into 9,438 communes Each province is administered by a prefect, each arrondissement by a subprefect. In the Venetian provinces each district is administered by a commissioner. The syndic (mayor) is chief of the municipal administration. He is appointed by the king from among the municipal councilors. Each prefect is assisted by a council, whose members are nominated by the king. Side by side with the "prefecture," there is an elective council for the province, having an administrative representation in the provincial deputation. In the arrondissement, besides the prefect or subprefect, there is a questor, a delegate or commissioner of public safety. In each chief town of a province there is a recruiting commission, and in the capitals of provinces and districts commissions of public health meet, and there is a board of education In the capital of a canton there is a judge and a commissioner of public safety. In each commune there is an elective municipal council, with an administrative committee, composed of assessors, presided over by the mayor. Each province has its own budget. The provincial council votes it; the provincial deputation, appointed by the provincial council, administers it. The sources of revenue of the provinces are made up of the incomes from patrimonial estates and trifling additions to the state taxes. The commune also has its budget. The municipal council votes it; the committee of assessors (junta) and the mayor administer it. The sources of revenue of the commune are like those of the province, and, besides, the commune has tolls and local taxes. —The councils, both of commune and province, by the law of March 20, 1865, are elected by a relative majority of votes. The duration of their office is five years. At the close of every year, one-fifth of the council goes out. In the first four years the members retiring are chosen by lot; in the subsequent years, by seniority. Retiring members are indefinitely re-eligible. They receive no remuneration. The king can dissolve communal and provincial councils, in the interest of public order, but must cause them to be renewed within three months. During the interval, communal and provincial affairs are administered by a royal commissioner. The legal age of an administrative elector is twenty-one years; the other electoral conditions are almost the same as for political elections. Nevertheless, the amount of taxes qualifying an elector is but twenty-five francs in communes of more than 60,000 inhabitants; twenty francs in those of from 20,000 to 60,000 inhabitants; fifteen francs in those of from 10,000 to 20,000; ten francs in those of from 3,000 to 10,000; and five francs in those of less than 3,000 inhabitants. A person may be an administrative elector in one or several communes, in one or several provinces, if he have a residence, estate or establishment there. The administrative electoral lists are drawn up and revised like the political electoral lists, and the electors have the same right of objection. —The communal council is composed of eighty members in communes of more than 250,000 inhabitants, of sixty in those of more than 60,000, of forty in those of from 30,000 to 60,000, of thirty in those of from 10,000 to 30,000, of twenty in those of from 3,000 to 10,000, and of fifteen in the smallest communes. The junta, or board of assessors, is appointed by the council, by absolute majority of votes. The assessors are ten in number, with four substitutes, in cities of 250,000 inhabitants; eight, with four substitutes, in those of more than 60,000; six, with two substitutes, in those of more than 30,000; four in those of from 3,000 to 30,000 inhabitants; and two in communes of less than 3,000 inhabitants, with two substitutes. The communal councils assemble in ordinary session twice in the year, in spring and in autumn. In extraordinary session they may come together at any time, subject to the authorization of the prefect of the province. —The council, not the junta, appoints and dismisses all employés of the commune; deliberates upon all administrative matters, contracts and everything touching the interests of the commune. It passes laws concerning local magistracies, institutions of benevolence and instruction, police and local sanitary matters; also laws for the collection of local taxes. All available funds must be employed Among the obligatory communal expenses the law enumerates the salary of a secretary, office expense, cost of recovering taxes, cost of preserving the property of the communal patrimony, the construction of roads, the keeping in repair of roads and public places, elementary instruction, the national guard, lighting, cemeteries, subscription to the "bulletin of laws," electoral boards and local police. The council is obliged to concur with the state or the province, and with the union or consorzio of the communes interested, in certain expenses fixed by law. All other expense is optional. The budgets for the communes of 1870 amounted to, receipts, 338,978,834 francs, and expenses, 341,150,600 francs. The subprefect decides whether or not the deliberations are conformable with the laws. He can suspend the execution of them, except in case of urgent need; the prefect may, in case of need annul the deliberations of the council. The law determines what deliberations of the communal councils must be approved by the provincial deputation, or by the king. From the decision of the prefect, or of the provincial deputation presided over by the prefect, there is an appeal to the king, who submits the question to the council of state. —The provincial councils (general councils) are composed of sixty members in provinces of more than 600,000 inhabitants, fifty in those of from 400,000 to 600,000, forty in those of from 200,000 to 400,000, and twenty in all others. The provincial councils assemble regularly in ordinary session the first Monday in September of each year; they can be convoked in extraordinary session by the prefect. Their deliberations usually concern the founding of public provincial establishments; secondary and technical instruction; provincial roads; the support of the insane and of foundlings; the preservation of monuments and archives; the regulation of the streams, etc., and, in general, all the administrative affairs in which the province has an interest. The provincial council takes charge of the charitable, benevolent and religious institutions; gives its opinion upon proposed changes of territorial limits, on the construction of roads, on tolls and markets, and on the establishment of associations between communes, and between tax payers (consorzii). The provincial deputation, which has the "guardianship" of the communes, is composed of ten members in provinces of more than 600,000 inhabitants, eight in those of more than 300,000, and six in the others, with substitutes to the number of four in the first class and two in the others. The provincial budgets, not including that of the province of Rome, amounted, in 1870, to 78,766,736 francs, receipts, and to 79,109,567 francs, expenditures. —IV. Finance. The law of April 29, 1869, established the general principles of the financial administration The minister of finance prepares each year the general plan of the budget of the receipts and expenditures of the state. For this purpose each of the other ministers transmits to him the plan for the particular budget of his own department. In the budget ordinary receipts and expenditures are first entered, followed by the extraordinary. Every item of extraordinary expenditure exceeding the sum of 30,000 francs must first be approved by special law. —The financial year coincides with the solar year (Jan. 1 to Dec. 31). It is never longer, and the account of the financial year relates only to the actual receipts and expenditures of that year. In the first two weeks of March the minister of finance must present to parliament a scheme for the budget of each ministry, and one including all of these, indicating the provisions made for the receipts and expenditures of the following year. These estimates are approved before Jan. 1. During the same two weeks in March the minister of finance must present a general and definitive budget for the current year, together with the modifications of the provisions of the first budget, already approved, and giving account of the balances of the preceding year. To this definitive budget is added a statement of the condition of the treasury. —The collection of direct taxes has been regulated, since Jan. 1, 1873, by the law of April 20, 1871 By virtue of this law there must be a collector of taxes for each commune or union of communes (consorzio). He is paid by the communes; the office is by them awarded to the highest bidder, for a term of five years. The collector is also charged with the collection of the taxes of the state, as well as those of the communes and provinces, according to lists which are furnished him. He is responsible for the sum total of his lists, even for the sums which he may not have collected. In the chief city of each province a receiver general collects the sums due by the collectors of taxes for the state and province, and is responsible for them, even for those not collected. The office of receiver general is sold at auction for a term of five years, and he is remunerated from the provincial funds. The taxes on landed property have been made uniform by the laws of July 14, 1864, and May 25, 1865. The whole financial system was then unified, and now all citizens are subjected to the same taxes throughout all the provinces of the kingdom; though the islands of Sardmia and Sicily are exempt from the duty on salt, and the latter from that on tobacco even, the cultivation and sale of this plant having remained free there. The taxes of the kingdom may be divided as follows: 1, taxes on landed property: 2. taxes on the income from personal property; 3. taxes on the grinding of cereals. 4. taxes on affairs, such as the right of registration on civil acts, on the right of succession and judicial acts, stamp duties, etc; 5. taxes on the cultivation of tobacco, except in Sicily, and on the manufacture of beer, soda waters and alcoholic drinks; 6. taxes on articles of consumption in city and country communes. (with the exception of flour, meat and drinks, all articles of consumption may be subjected to communal dues, and besides, the commune can add its own taxes to those of the government). 7. taxes on foreign commerce, customs and rights of navigation. (raw material is exempt from all impost laws, and the tariff on the other products of industry and manufacture is extremely moderate—no prohibition nor differential law is insisted upon); 8. the government monopolies, such as the sale of salt and tobacco. 9. lotteries; 10, the profits of the public services, such as the postal system, telegraph, etc; 11, the revenues from domains, and the receipts of the railroads operated by the state, 12, contingent revenues of divers kinds; 13, reimbursements and regular receipts; 14, ecclesiastical revenues. —V. Administration of Justice. The kingdom of Italy obtained a uniform civil legislation by the code promulgated June 25, 1865; in it, civil marriage and the equality of males and females in the right of inheritance were established. Tuscany only has her own peculiar penal code, whereas all the other provinces have one and the same, the penal code was modified in a few respects for the Neapolitan provinces, for the purpose of lightening the penalties imposed for certain offenses. Capital punishment is effaced from the code of Tuscany. Commercial legislation, as well as codes of procedure, are the same throughout the kingdom; the codes of commerce and civil procedure date from June 25, 1865; those of criminal procedure from Nov. 26, 1865. Nevertheless, there are five courts of cassation. They are held at Milan, Florence, Naples, Palermo and Rome, and are called upon to decide, in matters civil and criminal, cases of violation or false application of the law. The courts of appeal do not render final judgment, but reject the opinion or reverse the decision of the first judges and send the case to another tribunal. The law of Dec. 6, 1865, made the judicial organization uniform throughout the realm. It embraces the court of appeals, appellate courts, courts of assize, tribunals of commerce, civil and correctional courts and pretors In each commune there is a justice of the peace, in the large communes, several There is a public prosecutor for the court of appeals, as well as for the civil and correctional courts. Justices of the peace are appointed by the king. Their services are gratuitous They decide without the formality of procedure, and render final judgment in petty cases, involving personal or real property to a sum of not more than thirty francs. They act as arbiters when their advice is demanded in disputes between residents of the same commune. Where there is no justice of the peace these duties devolve upon the syndic, or mayor Every judicial district (the judicial district consists of one or several communes and even of part of one) has a pretor, who decides in the first instance in civil and commercial cases involving as much as 1,500 francs, and in offenses against police regulations. The civil and correctional tribunals have jurisdiction over one or several administrative districts. There are 162 of them. They pronounce in the second instance upon the decisions of the pretors, and in the first instance upon civil matters, which are relegated to them by law, as well as crimes. Connected with these tribunals there are one or several judges, charged with the examination of criminal matters. —The members of the tribunals of commerce are appointed by the king on the recommendation of the chambers of commerce respectively: there are sixty-eight of these in the whole kingdom. The tribunals decide in cases deferred to them by the commercial code and other laws. The courts of appeal are twenty in number, of which three have altogether four detached sections, which sit outside of the city, the residence of the court. Thus, there are twenty-four cities with a court of appeals, or a section of one. The courts of appeal take cognizance in the second instance of cases already judged by the district and commercial courts, and of complaints in matters of election. They decide, moreover, on the acts relative to the record of crimes to be sent before the court of assize. Each court and even separate section of appeals consist of three chambers, viz. civil chamber, chamber of correction and chamber of accusation. Five councilors at least must be present in civil cases, six in correctional appeals, and three in the chamber of accusation, to make a decision valid. The courts of assize are convened every year by royal decree at the time and place determined by law. The jurisdiction of each court of assize embraces that of one or of several tribunals. Each court of assize is composed of three councilors of the court of appeal, to which the decisions of the court of assize may be carried for approval or reversal: they are charged with the making up of the record of cases, and the application of the law after the verdict of the jury. The jury is composed of twelve men, chosen by lot from among the electors of fully thirty years of age, and able to read and write. The court of assize has cognizance of ordinary crimes, misdemeanors of the press and political misdemeanors. Appeal can be taken against the decision of the court of assize. —Crimes of high treason and political trials of ministers come under the jurisdiction of the senate, which is erected into a high court of justice on such occasions The public ministry represents the executive power in relation to judicial authority. The functions of the public ministry are exercised in relation to the judges of districts by the delegate of public surety (police commissioner), or by the mayor, or by a fiscal procurator In the tribunals of the arrondissements the public ministry is represented by the procurator of the king; before appellate courts and the court of appeals, by the attorney general. The public ministry has charge of state actions against criminals. It has the right of appeal to the higher court in the interest of public order and law. —The defense, by courtesy, of the poor, in civil and penal cases before tribunals and courts (judicial aid) is confided by the president of the tribunal or of the court to some lawyer practicing within its jurisdiction. Counsel for defendants, under such circumstances, who take the case without remuneration, have to defend, in both civil and criminal courts, individuals and moral bodies admitted to judicial aid, according to rules determined by law. —VI. Worship; Relations of Church and State Almost all Italians (99.7 per cent.) profess the Catholic religion. In the north a few valleys of the Alps, on the side of Pignerol, are inhabited by Vaudois, descended from the partisans of Peter Valdès. They have a temple at Turin. A few ancient Albanians, living in scattered localities in southern Italy, along the shore of the Adriatic, profess the United Greek faith. There are 40,000 or 50,000 Jews and 30,000 to 40,000 Protestants. Altogether, the members of non Catholic religions do not number over 100,000 The principle of toleration in religion is embodied in the constitution of March 4, 1848, and has been interpreted and widely applied in the most liberal sense. Churches and temples may be erected by non-Catholics and kept open to the public, but the permission of the government must first be had. This permission is not necessary for the Catholics. The discussion of religious matters is entirely free. —The relation of church and state are regulated by the law of May 13, 1871, which at the same time determines the prerogatives of the sovereign pontiff and the holy see. According to this law the person of the pope is sacred and inviolable. Attempts against his person or instigation to such action, as well as public insult and injury, are punished with the same penalties as are the same crimes and misdemeanors against the person of the king. These crimes come under public jurisdiction and are taken cognizance of by the high court of assize. The Italian government renders the sovereign pontiff within the territory of the realm the sovereign honors and pre-eminence of honor accorded to him by Catholic sovereigns. The pope has the power of retaining the usual number of guards attached to his person and palace. The holy see is made the same allowance—3,225,000 francs—that it received in the budget of the pontifical states; this allowance is inscribed on the ledger of the public debt as a perpetual annuity, and inalienable in the name of the holy see, payable even during the vacancy of the holy see; and it is exempt from all sorts of taxes and burdens, whether governmental, provincial or communal. It is provided that the sovereign pontiff shall continue to enjoy the palaces of the Vatican and of the Lateran with all their dependencies; as well as the villa of Castel Gondolfo. The said palaces, villa and surroundings, with their museums, libraries and art collections, are inalienable, exempt from all taxes, and not subject to the exercise of the right of eminent domain by the state. During the vacancy of the holy see no authority can, for any reason whatsoever, interfere with or restrict the personal liberty of the cardinals; the government is pledged to see that the conclave and the œcumenical councils are troubled by no violence. The representative or agent of public authority can penetrate into the palaces and places which are the habitual residence or temporary dwelling of the sovereign pontiff, or in which may be assembled a conclave or an œcumenical council. It is prohibited to pay visits of examination, search, or to remove papers, documents, books or registers, in the pontifical offices or congregations, when such are of a purely spiritual character. The sovereign pontiff is entirely free to perform all the functions of his spiritual ministry, and to cause to be affixed to the doors of the basilicas and churches of Rome the acts of that ministry Those ecclesiastics, who, in the exercise of their functions, participate in the production of these acts, are subject to no search, investigation or prosecution by reason of them; any strangers at Rome, invested with ecclesiastical functions, enjoy the personal guarantees of Italian citizens. The ambassadors of foreign governments to the holy see enjoy all the prerogatives and privileges of diplomatic agents, granted by international law. The representatives of the see at foreign courts are insured the same guarantees and immunities, both going and coming. —It is provided that the sovereign pontiff shall have the right to correspond freely with the episcopacy and the whole Catholic world, without any interference on the part of the Italian government. He can establish at the Vatican or his other residences, post and telegraph offices with his own employes. The pontifical postoffice may correspond directly, in sealed envelope, with the offices of foreign administrations, or deliver its own correspondence through the Italian office. In both cases the transportation of the pontifical mail is exempt from all taxation or expense on Italian territory. Couriers expedited in the name of the sovereign pontiff are put on the same footing as those of the ministries of foreign governments. It is also provided that the pontifical telegraph office shall be connected with the general system of the realm, at the expense of the state; that its telegrams shall be received and sent as telegrams of the state, and shall be free of charge; that the same advantages shall be granted in the case of messages presented at any regular office by order of the pope, and messages addressed to him shall be exempt from the charges made against the person to whom the telegram is sent. —In the city of Rome and its six suburban sees, the seminaries, academies, colleges and other Catholic institutions, established for the purpose of ecclesiastical education, depend solely on the holy see, without any interference on the part of the school authorities of the realm. All restrictions on the right of assembly of the Catholic clergy are removed. The government renounces the right of nomination to and patronage of the major benefices; bishops are not obliged to take the oath of fidelity to the king. The major and minor benefices can only be conferred upon citizens of the realm except in the city of Rome and in its suburban sees. —The royal exequatur and placet have been abolished; likewise every other form of governmental authorization of the publication and execution of the acts of ecclesiastical authority Nevertheless, until the reorganization, preservation and administration of ecclesiastical property shall have been provided for by a special law, the acts of the ecclesiastical authorities, having for their object the disposal of church property, and provision for major and minor benefices, except those of Rome and its suburban sees, shall remain subject to the exequatur and placet. In matters spiritual and disciplinary, there is no appeal from the acts of the ecclesiastical authorities, on the other hand, they can not execute their decrees by the aid of the state. Cognizance of the legal effects of such acts and of every act of ecclesiastical authority belongs to civil jurisdiction; these acts are devoid of all force and effect, if contrary to the laws of the state, to public order, or if they violate the rights of individuals; if they constitute a crime, they come under a penal code. The royal decree of June 23. 1871. regulates the concession of the placet and exequatur; by article five of this decree, a person invested with a benefice can not take possession of it until his title be provided with the royal placet or exequatur. —A law of July 7, 1866, suppressed all orders, all religious corporations and congregations. The members of these moral bodies, even mendicants, were allowed a life pension of 600 francs or less, according to the age of the pensioners. Their possessions were made over to the state. —The number of archbishops having dioceses is 47; of bishops, 217; in all, 264. It may be well to note here that in the diocese of Milan the Ambrosian rite is still in use. The Milanese or Ambrosian church, although one with the Roman Catholic, is distinct from the latter in its ritual, its celebration of the mass, the breviary, and especially in the administration of the sacraments, beginning with baptism by immersion. The revenue of the property of the secular clergy, administered by themselves, is estimated at 55,000,000 francs at the very least. To this we must add the tithes levied by the clergy upon the harvests in several provinces, and the fees for baptisms, marriages, funerals, etc. —VII. Public Instruction. The fundamental law of public instruction is that of Nov. 13, 1859, modified for the provinces of Tuscany and the old kingdom of Naples at the time of its promulgation in those countries. A few other modifications have been effected by laws common to the whole kingdom. Education is of three degrees. namely: elementary, secondary and superior. Secondary instruction is divided into classical and technical. Higher education comes within the province of the universities and higher institutions of learning. Secondary classical instruction is given in the lyceums and gymnasia (colleges); secondary technic instruction, in the schools and institutes of technology; elementary instruction is given in the communal schools. We have enumerated elementary instruction as among the obligatory communal expenses. Universities and lyceums are supported by the state. Gymnasia and schools of technology are at the charge of the communes in which they are established. Technological institutes are maintained by the provinces. However, in the case of the two latter categories, the state contributes toward their expenses to the amount of half the salaries of the faculties. —VIII. Public Charity. Benevolent institutions are numerous in Italy. Every commune supports one or more. They are regulated by the law of Aug. 3, 1862. Provinces maintain at their expense foundling and insane asylums These institutions are administered by a bureau of charity in each commune. This bureau is appointed by the municipal council, and has a president, with four or eight members, according to the population of the place. The president's term of office is four consecutive years; the other members' service expires, one each year for four years; but they are always re-eligible. The municipal council may elect a special board or bureau for an institution, when the board of charity does not suffice. Institutions, whose manner of administration has been predetermined by the act establishing them, are without the jurisdiction of the latter. Every year a budget of receipts and expenditures is prepared. This is approved by the provincial deputation, to whom are also referred the rules of government, the sales, purchases, acceptances or refusals of bequests and the authorization to sue. However, permission to acquire property through legacies is definitely granted by the government. When an institution is subventioned by the state, its budget must have the approval of the minister of the interior. The latter has, moreover, the right of surveillance and control of the administration of all charities. In cases provided for by law, institutions may be reformed, or even transformed, when they no longer serve their purpose. This has been done in the case of asylums for pilgrims and neophytes, institutions created for the ransoming of Christian slaves in heathen countries, etc. The demand for reform or transformation is addressed to the council of the province by the municipal council. The prefect then submits it to the minister of the interior, who acts upon the instruction of the state council. All new foundations of benevolent or charitable institutions must be authorized by the government. —IX. Military Organization. The kingdom comprises sixteen territorial divisions. There are twenty-eight fortresses and fifty-three military districts. Four general commands of army corps are established in Rome, Verona, Naples and Palermo. By the Sardinian law of March 20, 1854, which, after the annexation, went into force throughout the whole kingdom, every citizen is subject to conscription as soon as he has completed his twentieth year, and even before that age in case of war. All the young men born in the same year form a class from which is drawn the yearly contingent, fixed by law. This contingent is distributed by arrondissements, in proportion to the number of those inscribed upon the lists of the class, which is chosen by lot to enter the army. The direction of the conscription, according to the law of March 29, 1865, is confided to a functionary of the administration, to the prefects and the subprefects; its execution devolves upon a council of conscription in each arrondissement. The latter is composed of the prefect or subprefect, two provincial councilors and two army officers. It is assisted by the administrative officer and a doctor The mayors of each commune enroll the name of the young men upon the recruiting lists. After these have been published, lots are drawn; after that, the council of conscription visits the enlisted and pronounces upon their right to claim exemption from the service. The men chosen by lot to form the annual contingent from the first category. They are called to the army, and are assigned according to their aptitudes, to one or another corps of the army; the rest form the second category, and are subject to military services for forty days in each year. —The law of July 19, 1871, modified the organic recruiting law, and instituted a provincial militia. It provides for the voluntary enlistment for one year, under certain conditions, of young men who wish to become proficient in the art of arms. All exemption from military service has been done away with, except the substitution of a brother, and this liberation, dependent upon the payment of a premium fixed by law (2,600 francs in 1871 and 1872), only transfers the young man from the first to the second category. University students, students of medicine, pharmacy, surgery and veterinary pupils enrolled in the second category, are exempt at their request from military instruction; but they are liable, in time of war, to be called upon to serve in their capacity of doctor, surgeon, etc., up to the age of thirty-four years. A like exemption may be claimed by ecclesiastical students. Both classes are deprived of this right of exemption, if, at the age of full twenty-five years, they have not received their professional diplomas, or taken higher orders. The volunteers of one year receive no pay. At the end of their time, if they have given proof of sufficient military knowledge, they may claim exemption upon paying a premium not exceeding one-third of that fixed in ordinary cases; or they may be transferred into the provincial militia, even with the rank of officer, after an examination as to fitness. Besides the voluntary enlistment of a year, there is, for young men of, at the least, seventeen years of age, a kind of volunteering called permanent, that is, for eight years of service; also a form called temporary enlistment. Aliens, and in general all volunteers not included in the recruiting lists, are accepted only for eight years of service. Soldiers, discharged at the close of their term of obligatory service, may re-enlist voluntarily for a term of not less than three years. In time of war volunteers for the duration of the war are enrolled. All citizens are subject to military service. The provincial militia is composed of men of the first category, who are in the three or four last years of their service, and men of the second category, who are in the four or five last years of service. The government may claim the services of soldiers of the militia to re-enforce the active army in time of war. Cavalrymen, artillerymen and men of the artillery train and sanitary corps are attached to the active army during their entire term of service. The officers are chosen from among soldiers who have quit active service by reason of retirement, voluntary resignation or permanent leave, and who wish to join the provincial militia. They receive an allowance, to which may be added a pension. —By the law of military organization passed Sept. 30, 1873, the standing army of Italy is divided into seven general commands, or corps d'armée, each consisting of three divisions, and each division of two brigades; four or six battalions of "bersaglieri." or riflemen, two regiments of cavalry, and from six to nine companies of artillery. The actual strength of the rank and file of the army at the end of December, 1878, was 199,537 men (peace footing), and 444,509 men (war footing). with 15,110 officers. The national militia is composed of 232 battalions of infantry, each of four companies, of fifteen battalions of "bersaglieri" cavalry; of sixty battalions of artillery; and of ten companies of engineers. The time of service in the standing army is three years in the infantry and five years in the cavalry. A certain number. distinguished as "soldati d'ordinanza," to which class belong the carabinieri and some of the administrative troops, have the option to serve eight years complete, and are then liberated without further liability to arms. In the army of reserve the time of service is nine years. —The naval army, that is, the gunners and marine infantry, is recruited from among the young men forming the yearly military contingent. There is a special conscription for sailors and mechanics of the navy. The term of service of conscription in the navy is eight years; of volunteers, until they are forty years old. —The navy of the kingdom of Italy consisted, at the end of December. 1881, of 88 steamers, afloat or building, armed with 684 guns. The navy was manned in 1880 by 11,200 sailors, and 660 engineers and working men, with 1,271 officers, the chief of them one admiral, one vice-admiral, 10 rear-admirals and 83 captains. The marines consisted of two regiments, comprising 205 officers and 2,700 soldiers. The merchant marine comprises 18,800 sailing vessels, with a tonnage of 990,000, and carrying a total of 184,000 seamen. The number of steam vessels is rapidly increasing. In 1872 there were 120 of these, with a tonnage of 33,000. The regular and coral fisheries give employment to 11,600 boats and 31,000 men. GASPAR FINALI. —X. Economic and Commercial History. The economic and commercial history of the times that extend from the crusades to the discovery of America, is in great measure Italian history. There will certainly be no one who will dare to call a useless work or a vain complacency of learned men, this investigation in the volume of history of the titles of Italian one time supremacy. The picture of the glory and of the treasures acquired by Italians, in the countries where they traded, ought to serve as a stimulus to imitation. After the changes that have happened he would be foolish who should dream of new domains on the coasts of the seas of the east. But the navigation of these seas is open, and if the times which Providence is preparing will be so favorable to the nations living on the shores of the Mediterranean that a part of the commerce with Asia shall take again its former route, it will then be known how profitable the results will be. It suffices to call to mind the geographical position of the Italian peninsula that we may recognize how Italian traders were naturally invited to be the first to take in hand the production of Asia and Africa, from the ports of Egypt and Syria or of the Black sea; and how, transporting them along the Mediterranean, they could furnish all christendom therewith, while greatly advantaging themselves. —At this epoch America had no existence for Europe; all the products in which the latter was lacking, and therefore obliged to demand of other parts of the world, came from Asia and Africa only. The countries of the east, in which nature has with so much liberality lavished her gifts, are in part bathed by those same seas that surround Italy. Greece, Syria and all Asia Minor offered to Italian traders excellent dépôts for the storing or exchange of their goods. The countries situated in proximity to the Black sea were almost all barbarous, and therefore could ill compete with the hardy Italian navigators, who visited the colonies founded by their valorous fellow-citizens around the Euxine, to receive the merchandise which caravans had brought from the central regions of Asia and even from the remote shores of the gulfs of Arabia and Bengal—merchandise which was then by them distributed through all Europe. Let us remember these conditions, in part natural and physical, in part economic and civil, to which of necessity their commerce was subject, and we shall be able to form some idea of the necessary and spontaneous superiority which these conferred on the merchants of Italy. —If we examine on the map the respective positions of the various provinces of Italy we shall see that lower Italy and Sicily must have been, at the time of which we speak, the principal seats and richest emporiums of this trade. On one side Naples commanded the Tyrrhenian sea. Tarento on the other side, and the cities of Puglia and Calabria, were those whose navigators could most immediately communicate, by passing through the Ionian sea, with the islands of the Archipelago and the ports of the Levant. Sicily, in turn, saw extending before her the coasts of Africa and Egypt, forming one of the principal routes of commerce. And yet history, reserving only the brief period during which Amalfi deservedly proclaimed herself queen of the seas, far from presenting lower Italy as having the palms of commerce, places her below Pisa, Genoa and Venice. Although this fact may at first sight appear strange enough, it will not be difficult to find a reasonable explanation thereof. —Sad consequences to commerce proceeded from feudalism, that form of social administration in which is to be found the real cause of the mercantile inferiority of Naples and Sicily. The isolation, says Giuliano Ricci, in which they live in the midst of the state, withdraws both plebeians and patricians from extended commerce and perfected industry, interrupting or rendering slow and difficult all communications and relations of interest, at the same time that it paralyzes undertakings of every kind. Hence it is that Norman feudalism withered the municipalities in the south of Italy, and paralyzed that commerce and those manufactures which prospered in the north, and which might have found in the south, through the convenience of its ports and the nearness of the springs and routes of commerce, favor and encouragement. If feudalism was not the cause, how is it that from Briudisi mistress of the mouths of the Adriatic, commerce thrust itself to the lagoons of Venice from Syracuse and Amalfi to Pisa and Genoa? But, as above indicated, Amalfi, situated on the gulf of Salerno, had its period of prosperity. It is even the first Italian city of which we can infer with certainty the maritime commerce with the Levant. Obliged to contend against the Arabs and Saracens, its navigation received an extraordinary increase; and in the year 849 saved Rome from a threatening invasion. At Palermo, at Syracuse, at Messina, its traders possessed store houses and agencies; and the vessels of Amalfi, from the tenth century, were to be met in the ports of Beyroot and Alexandria, employed in the transportation of pilgrims to the Holy Land and in mercantile operations. By the route of Durazzo they trafficked meantime with the Greek empire, and at Constantinople obtained conspicuous privileges. During the brief periods of its prosperity Amalfi could count 50,000 inhabitants; its money was current throughout all Italy and the Levant, and the famous Tavole Amalfilane formed a maritime code imitated by later and foreign legislation. Of Flavio Gioïa, a citizen of Amalfi, and of the mariner's compass, we need say nothing here. But foreign conquest and military fury soon brought to ruin this great prosperity. The Normans, in 1131, deprived Amalfi of its liberty; and, soon after, a fleet from Pisa assaulted and sacked it, reducing it to a heap of ruins. Amalfi fell at the very moment in which Italian commerce generally was rising, and Pisa and Genoa obtained the rich heritage. —From the tenth to the twelfth century Pisa was the principal commercial mart of Italy. The Arno, then navigable right under its walls, made almost a maritime city of it, while at the same time opening up a channel into the interior of Tuscany Pisa, in whose deserted streets to-day the grass is growing, had, in the times of its splendor, as many as 200,000 inhabitants. The frequent irruptions of the Saracens, from one of which it was freed by the prowess of its heroine, Cinzica Sismondi, had obliged Pisans to acquire skill also in the use of arms; and the common peril had induced the Genoese to unite with their rivals against the infidels, from whom the two republics snatched the dominion of Sardinia, which was afterward to become the apple of discord. In 1087 the Genoese and Pisans combined made an expedition against Tunis; and the Tuscan navigators made conquests besides on their own account, among others those of Corsica and the Balearic isles, from which able mariners were recruited. —That which distinguished Pisa from the other Italian republics was the liberal policy with which its ports were opened to strangers. But the Genoese contemplated with an evil eye the dominion of the Mediterranean being contended for by the Pisans, for whom they were reserving the same fate which the latter had inflicted on Amalfi. The possession of Corsica and Sardinia was the occasion and pretext of war; a war of extermination, from which the greater profit was drawn by the queen of the Adriatic, which with secret joy beheld, as a spectator, the terrible injuries which its two sisters on opposite shores were inflicting on each other. —In the first and second crusades the Pisans had taken a leading part, obtaining, as a reward, great privileges in the Levant, and fortresses and establishments upon all the coasts of Syria and Asia Minor. Jaffa, St. John d'Acre. Tripoli, Laodicea and Antioch were almost entirely in their power. At Tyre they had founded a company, religious and at the same time mercantile, called, as if by antiphrasis, that of the Humble, (sociatas humiliorum) devoted to trade, principally to the weaving of wools. —These great successes increased all the more the rancor and envy of the Ligurian metropolis which, toward the end of the twelfth century, definitively took away from Pisa the two islands so long disputed: and in 1283, near the reef of Meloria, the Pisan fleet and grandeur were destroyed. And not even content with this, the Genoese stirred up internal factions, which soon covered with blood the banks of the Arno; and, to deliver a last blow to their former rivals, and excite a formidable competition to the Pisan port, in 1421 they sold to Florence the harbor of Leghorn for 100,000 gold crowns. —The discords of the Italian cities were always the principal cause that prevented the peninsula not only from uniting to form a powerful nation, but likewise from preserving the palms of civilization and commerce acquired with so much toil and blood. And yet it must be confessed, that, in the history of the world, those intestine strifes themselves were the occasion of some good and the cause of a progress which otherwise would with difficulty have been obtained. From the most painful evils Providence knows how to draw out germs of future advantage for the human family. Previous to the great epoch of the Italian republics, war was carried on ordinarily through mere thirst for conquest, by barbarous and ferocious soldiers, who fought only for the sake of fighting and destroying. Italian communes, on the contrary, introduced a new kind of wars, commercial ones, from motives of interest; they destroyed but for the sake of producing, of accumulating; wealth was their object, as much at least as glory. Besides, but for the profound rivalry which divided those municipalities into inimical camps, and obliged them to perform deeds of prodigious heroism, can we believe they would have become so great? In order to be great it is necessary to be able to love strongly and hate strongly; and it is quite doubtful whether hatred or love contributed most to the greatness of Italy. Heaven forbid that we should say this as a justification or apology for the miserable fratricidal arms, the eternal cause of Italian weakness and shame at this time; but impartial history must explain the facts it relates and not shrink from confessing the benefits which often had their origin in the most deplorable misfortunes; and we can have no doubt that these mercantile wars were a notable social progress in comparison with former wars of conquest and invasion. —Genoa and Venice alone remained to contend for the empire of the seas. It is known how Venice arose. Attila had passed the Alps, sacked and reduced Aquileia to ashes; he was threatening to descend on Rome. The inhabitants of the destroyed city and of the neighboring country sought refuge on the sandy islets of the lagoons, and founded there, in the year 450 after Christ, a species of federative republic, in which each of the isles was governed by its own tribunes. Fishing and the production of salt were the first industries of the little nation. The security they enjoyed, in the midst of the sea upon their rocks, invited new colonists, and little by little this became so conspicuous as to be able to neutralize the importance of Ravenna, the capital of the empire of the Ostrogoths. When Justinian, emperor of the east, declared war against the latter, and sent his generals, Belisarius and Natsetes, to subdue them. Venice afforded to the Greeks the aid of its fleet. The battle of Vesuvius put an end to the Gothic dominion, and the exarchate of Ravenna inherited its power. But, hard pressed by the Lombards, the conquerors of the valley of the Po, the exarchs sought to make friends of a city that could do them great service, and granted Venice important privileges and commercial liberties. When Charlemagne descended into Italy to wrench the iron crown from King Desiderio, the Venetians, most skillful in profiting by every propitious occasion, won to themselves the friendship of the new Cæsar by aiding him in the siege of Pavia, and obtained as their reward the right of trading in his Italian states. Meanwhile the Greek empire, menaced by the Arabs, the Bulgarians and the Hungarians, was going to decay; and Venice, quick at all times to take advantage of circumstances, offered subsidies which were dearly requited. Fiscal exemptions, agencies and establishments in Roumelia and Constantinople itself, the conquest of Dalmatia—such were the rewards granted to the Venetians. In proportion as the circle of their political power was enlarged did they feel the necessity of modifying their internal constitution, giving it greater force and unity. They had already substituted the authority of a single doge for that of several tribunes. The Venetian oligarchy, glorious and illustrious, succeeded the democracy, and became the granite base upon which was to rest the whole machinery of the state. Ancona and Comacchio, which in the matter of trade had shown some disposition to rival Venice, had fallen under the blows of the Saracens and the Narientien pirates, and the queen of the Adriatic let them succumb without aiding them. —The Grecian emperors had helped to promote the crusades, but were not long in repenting of it. The Frank warriors, who remained for some time in Byzantium, committed violence and abuses; the Italian traders obtained important privileges, which Constantinople granted through fear of the Turks and from a desire to make powerful friendships. The Venetian agency (fattoria) in the suburb of Pera, had about 10,000 inhabitants and formed a little state, capable at times of neutralizing the power and authority of the local government. The tortuous and disloyal policy of the Byzantine emperors could not long remain faithful to treaties concluded with neighbors so formidable. And their perfidy, already long suspected, appeared manifest in the conduct of the emperor, Emmanuel Commenus, who in 1172, being refused by the Venetians their aid in his affair with William, king of Sicily, caused to be confiscated all their vessels with their cargoes, and all they possessed in his states, arresting even a great number of their citizens. —The republic of St. Mark was not one to tolerate such an unjust affront, and the opportunity of obtaining revenge for it did not long delay. When the fourth crusade was undertaken in 1202, Venice not only took upon itself the transport of the whole army, but prepared, besides, an expedition of its own, under the command of the doge, Enrico Dandolo. But not against the Turks, rather against the Greeks were these troops directed. Constantinople was taken, and the Latin empire was substituted there in 1204. The entire suburb of Pera, the Morea with the most fertile islands of the Archipelago, fell to the lot of Venice; which, in this manner, became once more preponderant in the commerce of the Levant, in which the Genoese and Pisans, at a former period, had been its victorious rivals. —Genoa, though prosperous and rich, had until now remained second to Venice. The industrious character of the Ligurians, and the advantages of the site they occupy, ill adapted to agriculture and marvelously litted for navigation, had early made them a people of traders, to such a degree that a proverb ran: Genuensis, ergo mercator. They were burning with the desire to supplant the Venetians in the Levant and to substitute their own power there. Able and astute politicians, the Genoese saw that Venetian power rested principally on the duration and force of the Latin empire of Byzantium: and that this destroyed, the other would also fall. They resolved, therefore, to use every means for the restoration of the Greek emperors; and they succeeded in their well-imagined enterprise. —Michele VIII., Paleologus, implored the aid of the Genoese, who carried him in a fleet in 1261 to Constantinople, whence the Franks and Venetians were driven out; and Genoa obtained of the new lord all the possessions and privileges which its rival had enjoyed. Thus the capital of Liguria became the first commercial power of Europe; and, as Scherer justly observes, if the enterprising audacity and the fearless courage of its inhabitants had been governed by a wiser policy, they might long have preserved their supremacy. But the internal administration of Genoa was profoundly unlike that of Venice, and the Genoese were different men. The Venetian government represented a system strong, permanent, lasting; it was an edifice soundly established on the basis of an aristocracy prudent and ambitious. That of Genoa, on the contrary, was uncertain, fluctuating, torn by continual factions, and led from one novelty to another. If the comparison is allowable, we would say that Venice was the England and Genoa the France of Italy. Hence it happened that Genoa, having reached the summit of grandeur and prosperity, was not long in falling into decay, while Venice, on the contrary, though passing through the most contrary vicissitudes, knew how to maintain itself strong and respected. —If the Genoese had allied themselves with the schismatic Greeks to make war on the Venetians, the latter, less delicate still and less scrupulous, had leagued themselves with the Turks to bring the Genoese to ruin. Those trading peoples knew well how to compromise with their conscience and faith whenever their interests were at stake, or whenever they wished to satisfy their mutual hatred. But, in order to explain this point of Italian history, a few considerations are needed. There were then two principal routes by which the goods from Asia could reach the seas of Europe. One of these, from the Persian gulf, along the course of the Euphrates and the Tigris, extended as far as Trebizond and the other ports of the Black sea. And of this the Genoese, after the last revolution, had become masters. The other was that which, by means of the Red sea and Egypt, ended at Alexandria, where although the Genoese had their agencies, there was still a possibility of competing with them. And all the more since the first of the two routes, in consequence of the commencing decadence of the caliphate, had become insecure on account of the brigands who infested it: while, on the contrary, in Egypt, under the military rule of the mamelukes, order and security reigned. Whence it was that when the Genoese seized the trade of Constantinople and the Black sea, the Venetians turned all their attention to the possession of Alexandria. —Papal Rome had, by a pontifical edict, forbidden any direct relations with the infidels. But Venice, by the astuteness of diplomacy and rich presents, knew how to obtain a special dispensation, thanks to which the Roman court granted to those traders permission to send a limited number of vessels to Egypt and Syria. But soon even that last clause limiting the vessels fell into disuse, and Venice directed to those ports the principal efforts of its policy and navigation, and concluded several advantageous treaties with the mameluke sultans. It must be said that Genoa had not been a whit more particular than its rival, and had, some thirty years before, signed a treaty with the Tunisians. —Thanks to this new commercial revolution, favored by the Venetians, Alexandria became, at the commencement of the fourteenth century, the centre and emporium of Indian trade. The Venetians carried there the productions of Italian industry, such as wool, arms, mirrors, glass, and the wares of other European countries; and exported thence drugs, spices, pearls, precious stones, ivory, cotton, Indian silk, and the indigenous products of Egypt. —The Genoese, though preponderant on the Bosphorus and the Euxine, could not long remain indifferent to the sturdy competition of the Venetians in the Italian seas. They also tried to obtain privileges in Egypt; and inasmuch as the sultans were interested in giving permission to every trading people who could bring abundance to their markets, they were not backward in satisfying them, so that the two great rivals soon met face to face on the banks of the Nile. On the other hand, the Venetians had not left their competitors tranquil on the Black sea; and in Trebizond they had strengthened themselves anew. From these causes there arose a mortal war between the two republics, which lasted from 1356 to 1380, and which terminated, after various vicissitudes, with the discomfiture of the Genoese. and the prostration of the contending parties, to the profit of the common enemy the Turk, who threatened to advance and confound in the same ruin the conqueror and the conquered. —But before occupying ourselves with the decadence of Italian commerce, we think it opportune to inform our readers with respect to some most important points appertaining to the epoch of its grandeur. We have related, according to chronological order, the vicissitudes of that memorable epoch; but let us stop to consider the various characters that distinguished it. And first of all it is well to make special mention of the Genoese colonies; which we do all the more willingly in as much as the government and legislation of these in many respects may truly be adduced as models. —The Black sea had, as we have indicated above, come almost entirely into the power of the Genoese. Taking possession of ancient Theodosia, they named it Caffa, from the name of one of the family, Caffaro, which gave to Genoa one of its best historians. The vicinity of the Mongol Tartars obliged the Genoese to fortify the city of Tauris and surround it with walls; but well knowing that the power and security of states rest upon good and strong internal regulations more than on bulwarks, they busied themselves in constituting there a regular and free government, composed of a consul, two councils, greater and lesser, a parliament, intendants, purveyors, a mint, chancellors, keepers of the keys, agents, captains of the town, of the port, of the market, and of stores. —All the consuls of the Genoese colonies, the first day they entered office, swore to observe the regulations of the republic, and to render justice to all. The consul of Caffa remained in office one year, which being finished, he was to lay aside his dignity immediately under penalty of 500 Genoese lire; but if his successor had not already come, three days before the expiration of his term he was to convoke the greater council (of twenty-four members), and invite it to elect the consul. The one chosen remained in office only three months, and could be reconfirmed until the arrival of the one sent from Genoa. The consul could not undertake anything without the approval of said council, which had to concur, at least by a two-thirds vote, for the sanction of any scheme. The greater council elected two key-bearers, who had charge of the money of the commune of Caffa. The lesser council (of six members) appointed every three months two agents and every six months two comptrollers. That which was especially laudable was that Genoa left to its colonies a sufficient liberty of internal administration. The magistrates of the republic were forbidden to meddle with the election of those of Caffa, except, as has been stated, the consul and his chancellor, representing the executive power of the colony. The consul was prohibited receiving any gift whose value should exceed the sum of ten soldi (cents) under penalty of four times the value. A month after his return to Genoa he came before the auditors, and before showing the operations of his administration the auditors (or syndics) were to consult with two or four of the best merchants of Caffa The auditors of the colony had the duty of inspecting the acts of the other magistrates. The officials over merchandise, victuals, money, etc., superintended these various branches of colonial police. —Similar to that of Caffa was arranged the administration of the other Genoese establishments on the Black sea, such as Cambalo (Balaclava), Trebizond, Amastri, Tana and Soudah. —The trade of Tauris contributed much to the wealth of Genoa; the Genoese exported thence salt, corn, timber, commodities which abounded there. In similar manner the skins and wool of the Crimea were exchanged for other merchandise of Greece and Roumania, especially wines. The Russians brought skins of the ermine, the lynx and other animals. The Tartars furnished linens, cottons and silk goods. By the caravans of Astracan there came the hair of Augora, used in the weaving of camlets. which the Genoese manufactured in a masterly way and sold at Constantinople, Cyprus, Alexandria and Nicosia. Finally. the colonists carried on a commerce of an infamous kind, carrying away from the Caucasus young creatures of tender age and both sexes and selling them as slaves to barbarous nations, chiefly to the sultan of Egypt. This traffic had been carried on by the Greeks, and was exercised by the Genoese, the Venetians and the Turks, who continued it until, in 1829, the treaty of Adrianople put an end to it The daring of the Genoese, shown in penetrating and spreading themselves everywhere with their commerce, is truly worthy of marvel. Along the mountains that flank the empire of Trebizond, toward its southern and eastern part, they went as far as Erzeroum, in Armenia, and thence to Tauris, in Persia. Marco Polo found them navigating the Caspian. As far as Tauris their caravans carried the wares obtained from Caffa and Galata, and exchanged them for those which the Asiatics brought along the Euphrates and through the deserts. But often it happened that instead of intrusting their goods to other hands, the Ligurian traders would themselves venture into the regions to the south and east of Persia. According to the testimony of the Englishman Anderson, the Genoese coins were very common at Calicut, on the coast of Malabar; and from a letter written in 1326 by Andrea da Perugia, and referred to in volume fifth of the annals of Vadding, we learn that the traders of Genoa went as far as the port of Zaytoun, in China. Of some other large mercantile stations of the Genoese we shall speak presently in the proper place. —We now turn to the commercial organization of Venice and its principle operations in trade. A peculiar and distinctive character of that republic was the extreme interference of the government in economic and industrial matters. These were affairs of the state. Maritime equipments and charters of vessels were not left to private will, but the government regulated the epochs and conditions of the contracts, the nature and composition of the cargoes, the payments, and the mode of carrying out the speculations. It ordinarily furnished the timber for naval constructions, and most severe laws were in force as to the cutting of forests. The crew and oarsmen (ciurma) of an Italian galley were of 220 to 300 men, and they calculated, at Genoa as at Venice, the annual expense of maintaining it at sea, at 120,000 lire. It must be remembered that the ciurma, or oarsmen, to the number of 110 to 180 (usually galley slaves), were not paid, and were very poorly fed. —We have no very exact statistics of the Venetian marine, it is calculated, however, that in the prosperous times of the republic it possessed 3,000 merchant vessels and forty-five galleys, with crews of 36,000 men. In the arsenal there were 160,000 workmen occupied. At the epoch of its decay, that is, from 1660 to 1797, this arsenal gave to the sea ninety-two ships of the line and twenty-four frigates. He who considers these figures, and remembers that Genoa in 1253 armed 193 galleys against Pisa, and in 1295 equipped against Venice 200, manned by 45,000 combatants, can form an idea of the immense naval force which Italy had then at its disposal. —In the Adriatic an admiral exercised supreme authority, under the title of captain of the gulf, and other similar officers were stationed in the Black sea and in the parts near Cyprus. As long as it was a question of voyaging in the Adriatic, isolated vessels could undertake it, but to go beyond the gulf a great number of vessels united in a convoy and sailed in company, lending each other assistance. The time for departure was fixed by law; the fleet for the Low Countries sailed in April; that for the Black sea in July; that for Alexandria in September, etc. The captain of a ship could not carry goods on his own account on the vessel he commanded, but was allowed to do so on another craft. As soon as the fleet arrived at its port of destination, the authority of the admiral or captain, as far as the trade was concerned, expired, to give place to that of the consul furnished with full powers. —The creation of consuls abroad is likewise of Italian origin. To establish a national authority in the midst of foreign states which, in this respect, renounced in part their territorial authority in favor of the representative of a foreign state, was a thing as difficult as it was necessary to a people which, like the Italian, had so gradually extended the sphere of their relations. Genoa obtained this privilege at Antioch in 1098: at Jaffa, Cesarea and St. John d'Acre in 1105; at Tripoli in 1109; at Laodicca in 1108 and 1127. Pisa obtained the same permission in the principal stations of the Levant in 1105 Venice had consuls at Jaffa from 1099, at Jerusalem in 1111 and 1113, at Antioch in 1167, at Beyroot in 1221. The custom of having consuls abroad, now general, was only introduced at a later date among other nations; and among the towns not Italian, Marseilles and Barcelona were the first to follow, in this, the example of Italian maritime republics. —The Venetian treasury did not claim duties on the goods imported from the Levant by the armed galleys, but those which arrived on unarmed vessels, belonging to private individuals, paid an ad valorem duty of 3 percent. In general, goods could be exported free. A mass of minute prescriptions emanated from the grand council as to commerce and navigation; and woe to the captain or merchant who dared to detract from that inflexible authority. But such was the habit of conforming to the regulations. such the universal conviction that trade was the first of state affairs, that the most noble families. at Venice as at Genoa. willingly educated their sons to commerce, although thus restrained. And it was a misfortune that the Italians of those days accustomed themselves to that protecting government in such a way, because when, the times having changed, it became necessary for individuals to act for themselves, they found themselves unfitted to meet the competition of nations newly entered into the lists, and fell behind like men from whom the daily care of their guardian had taken away the full and free use of their members. —From the year 1172 the republic of St. Mark created a tribunal charged with the superintendence of arts and trades. The quality and quantity of raw materials were exposed to severe examination. It was forbidden to any workman to engage in more than one industry, so that, with the division of labor, perfection might be assured. Weaving had made very great progress. and it was at Venice, in 1429, that was made public the first collection of receipts and processes employed for the dyeing of stuffs. The trade in drugs had propagated among the people a great deal of practical knowledge of chemistry. Skins were prepared and gilded in that market with a superiority that all admitted. The laces known as Venice point, hardware, sugar refineries, the works for the manufacture of glass and mirrors, feared no rivals. There was a law prohibiting a Venetian artisan from leaving his own country, for fear he might carry to foreigners a knowledge of industrial progress; whoever infringed this regulation received, in the first place, an order to return; if he resisted, his nearest relatives were arrested and remained in custody until the guilty one could be reached by assassins who slew him. A strange mixture of barbarism and civilization truly was the organization of the Italian republics! —One of the most potent instruments of commerce and production is credit, which accelerates the circulation of capital and gives a value to the capital, time. Venice was the first city that saw rise in its own bosom one of those institutions of credit which were then called monti or banchi, and are now named banks (banche). In 1171 was founded that bank of deposit which opened credits to whomsoever would entrust to it sums of money to facilitate its payments and transfers of cash. The office did not make any charge for custody or commission, nor did it pay any interest to depositors, but its certificates of deposit were accepted in circulation as if they were money. The bank paid at sight, in coin, the drafts that were presented and accepted. It was established as a principle that the bank, on receiving sums deposited, should credit the depositor only the intrinsic value, that is, the weight in fine metal, without taking account of the extrinsic value, in order to avoid the losses that occurred from the frequent monetary alterations which foreign governments did not scruple to make. And in consonance therewith it was decided that payments should only be made in effective ducats, whose quality was finer and less subject to alteration than other coins. Hence it was that the paper of the bank obtained a favor, a premium over all other titles of credit, and even over other representatives of coined money. Economy in the use of coin, promptness of payments by means of transfers upon their registers, stability of value in not being exposed to the perpetual oscillations of the market: such were the three supreme advantages which the bank of Venice offered, since then imitated in the greater number of commercial countries. —The traffic in salt was one of the principal branches of the Venetian administration. It was collected from Istria, Dalmatia, Sicily and the coast of Africa; and Venice became the great emporium of salt for all the south and east of Europe. At first this traffic was free to all on the payment only of a tenth; subsequently the state took it into its own hands. —There exists a discourse, pronounced in 1421 before the grand council by the doge Tommaso Mocenigo, which throws much light upon the finances and commerce of Venice. We see from it, among other things, that the duchy of Milan had to settle every year at Venice accounts that amounted to 1,600,000 ducats; and that 94,000 pieces of cloth were exported during the same period to that province The total value of the Venetian commerce with Lombardy was estimated at 28,800,000 ducats. It must be remembered that while Venice was carrying on a trade so gigantic, it possessed at the same time to an eminent degree the genius of polities, of the fine arts, of letters and the sciences The fatherland of Marco Polo, of Giosafatte Barbaro. and other great voyagers and merchants, was likewise that of painters like Titian, of men of science and letters like Frà Paolo Sarpi. —Before descending to an examination of the causes that precipitated from so lofty a height the Italian maritime republics. it is well to cast a rapid glance upon the communes of the interior of Italy. —Tuscany was, in common with Flanders and Brabant, the most industrial European country of the middle ages; and if Pisa, Genoa and Venice took the lead on the sea. Florence was ahead in manufactures and banking. The silk and wool fabrics of Florence enjoyed great fame as far back as the thirteenth century, and in order to procure the necessary supply of wool. the Florentines possessed agencies and branch houses in the principal emporiums. the single family of the Alberti had, about the middle of the fourteenth century. establishments at Bruges, Avignon. Naples, Barletta and Venice. From England and France came the common wools. and the fine qualities from Spain. In 1338 there existed at Florence 200 woolen factories, producing yearly 80,000 pieces From France, Great Britain and the Low Countries were collected rough cloths to a value of 300,000 gold crowns, which received in Florence a new preparation, of which the Florentines possessed the secret, in keeping with the taste of the Levantine markets for which they were destined. Indigo, cochineal, orchal and other substances had been for a long time employed by the Florentine dyers who were famous throughout Europe. Up to the fifteenth century Florence had been compelled to make use of other nations as intermediaries for the transportation of its productions Not having any port of its own, it was accustomed to use that of Pisa, which had granted to the sister town freedom from fiscal dues. But this privilege was taken away as soon as the rapid development of its commerce aroused the jealousy of the Pisans; and then Florence saw itself constrained to come to terms with Sienna to export its products from the port of Talamore. When Pisa, ruined by its wars with Genoa. felt itself in decadence, it sought anew the friendship of Florence. which once more began to make use of the former's port. But every friendly relation between the two Tuscan republics ceased when Genoa in 1421 had sold to Florence the port of Leghorn Placed thus in contact with the sea, the Florentine republic could devote itself to navigation; it created a special administration under the title of "magistracy of the consuls of the sea;" built an arsenal and dockyard; obtained at Alexandria in Egypt the same privileges which Pisa had first enjoyed there; ordained that twelve young men of the most conspicuous families should embark every year to initiate themselves, in the respective countries, in the trade of the Levant. The mercantile fleet of Florence was divided into two squadrons, that of the east and that of the west, but the total force never exceeded eleven great and fifteen small galleys. —Banking in Florence was carried on on a very large scale, and the bankers of that metropolis had correspondents, agents and branches in the principal seats of commerce of the then known world. In Italy alone one could count eighty Florentine houses exclusively devoted to this lucrative business. The princes of nearly the whole of christendom were debtors in important sums to the bankers of Florence, and the greater part of the historic patrician families descend from those mercantile houses. The Pazzis, the Capponis, the Buondelmontis, the Corsinis, the Falconieris, the Portinaris and the Medicis, were devoted to commerce. But unable to resist the temptations of a fortune always constant, and blinded by their success, the bankers of Florence enlarged to excess the sphere of their operations, and were involved in an immense bankruptcy, whose consequences were felt in the most distant seats of trade. —We can not take leave of the past of Florence without indicating how it occupied, on other grounds, an important place in the history of commerce and political economy. It was the first town, perhaps, which contributed valuable authors to mercantile science. Three Florentine traders, Pegoletti, Antonio da Uzzano and Bernardo Davanzati, have left the most ancient treatises on commercial matters. The first two arranged, with great order and method, in their works, varied information upon goods, moneys, weights and measures, usages, bookkeeping, insurance and charters. The third, celebrated for his translation of Tacitus, composed two lessons upon moneys and exchange, which are, even at the present day, models of clearness and elegance for writings of that class. —For flourishing agriculture, for active commerce and for good social organization, Lombardy was famous in the times of Italian grandeur. When the renowned confederation of the towns of upper Italy, formed under the name of the "Lombard League," came out victorious from the long war of Frederic Barbarossa, and constrained the haughty emperor to acknowledge and sanction the independence of those municipalities by the peace of Constance (1183), the world saw of what marvels Italy would be capable if united in one single will. But victory separated those valorous communities which danger had united, and the former strife recommenced once more, so that their political power was of but short duration. Their industries, however, remained prosperous and their accumulated wealth was increasing. —In foreign countries Lombard was synonymous with merchant and banker, and to-day still, in London and other metropolitan cities, they preserve the name of Lombard street for one of the principal thoroughfares. They, in fact, in the twelfth century, were the first to compete with the Jews in the art of exchange and lending at interest; in which profession, however, they soon met the competition of the Caorsini, so-called by antonomasia because the inhabitants of the town of Cahors in Languedoc also had devoted themselves quite early to this lucrative branch of trade. They lent upon security, exacting for their money an interest proportioned to the risk incurred; and as this was great in those calamitous times, the interest was consequently very high. In order to protect poor debtors religion then came to the rescue: two monks, Barnaba da Terni and Bernardino da Feltre, founded the first monti di pietà, charitable establishments that lent gratuitously upon pledge, which, however, were not long in degenerating and becoming usurious, so that Barianno slily vituperated them by naming them monti di empietà (impiety). —One of the economic glories of Lombardy was the construction of those navigable and irrigating canals which served as models for the hydraulic works of foreign nations. As far back as 1179 the Milanese made a commencement of the canal which was called Ticinello and after ward Naviglio Grande. —But it is necessary to pause in the description of the commercial and economic glories of the Italians of the middle ages; and it will be well at present to inquire what causes of decadence were so potent as to drag such grandeur down to ruin. According to some, one must needs blame as the only cause the single fact of the maritime discoveries of the Portuguese and Spaniards occurring toward the close of the fifteenth century; which, by changing the routes of commerce, took away from Italians their superiority in the trade of the Levant and transferred it to western nations. The passage to India by the cape of Good Hope and the discovery of the new world were, according to them, the sole reasons by which Genoa and Venice were precipitated from the summit of grandeur. This opinion we deem superficial, derived principally from the unfortunate tendency which Italians have to hope for too much, and to fear to excess events that are fortuitous or independent of them. A soothing thing it is to human sluggishness and national vanity to say, if we were great and now have descended from our former splendor, the fault is not ours, but rather that of fate or chance, which chooses to give to other nations the pre-eminence which we have lost without any fault of our own. Now we believe but little in the effects of chance upon the destiny of nations, and much, on the contrary, in the away of natural, economic laws. —Undoubtedly those discoveries contributed to accelerate the decadence of the Italian communes, because the geographical and political relations of the diverse portions of the world being changed, the navigation being diverted from the Mediterranean to the ocean, Italians were no longer the only ones to traffic with eastern countries, and to serve as intermediaries between them and the west. But the decadence, by this cause hastened and converted into regular ruin, had already some time before commenced; and Italians would have been quite able to overcome foreign competition as they had already conquered other obstacles not less important, if they had still been young and vigorous, in place of nourishing with in their own bosoms the germs of senile corruption. In addition to the discoveries of the Iberians, there were, in our opinion, three causes of the decay of Italian commerce. The first is to be sought in the weakening of Italian public spirit. In the fifteenth century the states of the peninsula had reached the summit of civilization and were commencing to descend the great are of which they had touched the top. In the fortunate period from 1100 to 1400 the Italian communes, having achieved their liberties, afforded the most celebrated examples to be found in history of activity, skill, diligence, virtue and heroism. Not in commerce alone, but in every art and branch of science were Italians then first and unique While Italian navigators were victoriously scouring the seas, and Italian bankers establishing agencies and houses in the most distant countries; while moles were hardily constructed and lighthouses erected, and canals and harbors excavated; while industries were flourishing and commerce was enriching Italy; at that very period all hearts were palpitating with the love of country. and were ready to swear it in Pontis and to combat for it at Legnano or Campaldino; warriors, men of science, citizens, Italians, were great none the less that they were merchants. And it is this simultaneousness of all the glories that constitutes the profound difference between the Italian communes and the Hanseatic Flemings. The latter for a long time were nothing but traders; Italians were all they chose to be, and wished to excel in everything, But, little by little, such great virtue became corrupt; minds became less jealous for liberty; to the strong and sublime literature of Dante succeeded the soft and effeminate kind of which Petrarch had been the innocent initiator; customs degenerated from their former austerity; luxury and dissipation squandered capital and contaminated morality; and to such a state as this were Italians reduced when the news reached them that Vasco de Gama had weathered the "cape of tempests" and Columbus had landed at San Salvador. What wonder if they allowed themselves to be surprised by these great facts and found themselves powerless to profit by them! If Genoa and Venice had still been what they were in the thirteenth and fourteenth centuries, they would have equipped their fleets and despatched them beyond the pillars of Hercules, and would have known how to reap their part as well, and certainly not the smallest. in the new conquests of Europeans. —The second cause that rendered Italians feeble and unfit to resist unforeseen misfortune, sprang from the intestine wars of which Italy was at all times the theatre. Her great cities considered each other always as so many states not only separated, but as enemies. The idea that they belonged to the same nation never dawned upon the minds of the doges of Genoa and Venice. Pisa brought rain upon Amalfi, Genoa cast Pisa to the ground; the war of Chioggia exhausted Genoa and left Venice weakened. Florence was at war with Pisa and Sienna; Milan with Pavia; and so it continued for three or four centuries, this Iliad of Italian woes. But why speak alone of contests between the various cities? Each municipality was divided and lacerated by many parties; the victory of one was the signal for the exile of the other. The houses of the vanquished were razed to the ground, and their wealth dispersed. So far from remaining astonished at the decadence of Italian greatness, Italians ought rather to wonder at its long duration. They had been able for three or four centuries to fill the world with their name, while in the fatherland they were killing each other in turn' These wars were the principal cause of the weakening and rain of Italy. a ruin which the coming of Charles VIII., of Louis XII., of Charles V., of Francis I, the league of Cambray, the policy of the Sforzas, the Medici and the Farnese, did much to accelerate. —In the third place, a great political and military event, of which the Levant was the bloody theatre, contributed to take away Italian supremacy The Turks, for a long time at war with the Greeks, increasing in strength and boldness since their Astatic rivals, the descendants of Timour, had re-entered their steppes, after having established themselves in Roumania. were threatening Constantinople, which in 1453 was occupied by Mohammed II The Genoese colony of Galata fell with Byzantium; and the other Italian establishments in the Archipelago, Asia Minor and the Black sea, fluctuated for some time, exposed to continual peril, until they also came under the power of the infidel. By the events which placed the Black sea under the authority of the Genoese, this republic, more than its rival Venice, had to suffer from an event so mournful. Venice. besides, had been able at an early date to come to terms with the Turks, and its potent oligarchy, with varying fortune, was still able to govern and make itself respected after that catastrophe. —If intellectual culture would suffice to constitute the civilization of a people, and if the splendor of letters, of science and the arts, were sufficient to render a nation happy, no other country could have the right to a more legitimate pride than that which Italians could nourish as to their own deeds in the sixteenth, seventeenth and eighteenth centuries. But poets, sculptors, painters, and men of science themselves do not avail to make a country great, when by the side of a few eminent celebrities lives a common people ignorant and idle; when tyranny and corruption are weakening, debasing and profoundly vitiating the national character. When a country has given birth to a Columbus, a Vespucci, a Cabot, a Verazzani, and permits these great men to achieve their sublime undertakings under a foreign flag, that country has ceased to take part in commercial history. Pigafetta of Vicenza, the companion of Magellan in his circumnavigation, described his memorable voyage; and the Venetian Ramusio published the recitals of illustrious discoveries: both these historians unwittingly cast a slur upon their own country, which, unmindful that it had once ruled the seas, was then yielding to other nations the palm of victory. GEROLOMO BOCCARDO. —XI. Agricultural, Industrial and Commercial Resources. The kingdom of Italy comprises 25,000,000 hectares of productive land, and 4,500,000 hectares covered by mountains, rivers, roads, cities, etc. These 25,000,000 hectares form about 5,000,000 estates or properties, and may be subdivided as follows: arable land and vineyards, 12,000,000 hectares; meadow land, mostly irrigated, 1,200,000 hectares; rice fields, 150,000 hectares; olive orchards, 590,000 hectares; chestnut plots, 600,000 hectares; forests, 4,400,000 hectares; pasturage. 5,600,000 hectares; marshy and uncultivated land, 4,000,000 hectares. —The average net income of a landed proprietor is computed to be 80 francs per hectare: which would be 2,000,000,000 francs for the total ground rent of Italy. This capitalized at 4 per cent. would amount to a principal of 50,000,000,000 francs. The average annual wheat production is estimated at 36,000,000 hectolitres; of rice, 1,600,000 hectolitres; of maize. 19,000,000 hectolitres. Adding the production of barley, oats, chestnuts, potatoes, etc., we have an annual production of 91,000,000 hectolitres. —The wine production is very abundant, and the qualities various. The wines most highly esteemed are those of Asti, in Piedmont, Montepulcians and Broglio in Tuscany, Capri and Lacryma Christi at Naples, those of Syracuse and Marsala in Sicily. The average production of wine is 26,000,000 hectolitres yearly. The cultivation of hemp is restricted principally within the provinces of Bologna, Ferrara, Forli and Ravenna. The product is estimated at 4,500,000 kilogrammes. The cultivation of tobacco is free in Sicily and Sardinia; it is also grown in Ancona, Pesaro, Umbria, Benevento and Terra d'Otranto Little cotton is grown as yet; a few fine bales were nevertheless sent to the London exposition of 1862. The American civil war, or the cotton crisis resulting from it, gave a lively impetus to its cultivation. The zone favorable to the growth of cotton commences at the forty-third degree, or the mouth of the Tronto, on the Adriatic, and extends along the southern coast to the promontory of Piombino, on the Mediterranean; it embraces the Neapolitan provinces, Sicily and Sardinia. Limiting this zone to lands in the vicinity of the sea, we would have 2,000,000 hectares suitable to the growth of cotton; 450 kilogrammes per hectare may be harvested in Italy; the costs of production come to about 200 francs, and the cotton can be ordinarily sold at from 1.30 francs to 1.50 francs per kilogramme. —Italian industry does not rank high in Europe, but is, notwithstanding, of some importance. Her mines yield iron, (especially in the island of Elba), beautiful marbles, lead and copper (in Sardinia), sulphur (in Sicily and Romania), salt, borax, etc. Among the most extensive industries we may cite that of silk culture (210 kilogrammes of cocoons or 13,200,000 kilogrammes of raw silk in 1871). The value of the pottery, porcelain and glassware manufactured in 2,300 establishments by 80.000 workmen, is estimated at 50,000,000 francs. The exportation of straw hats from Tuscany amounts to 15,000,000 francs annually. Tissues of all sorts are also made, arms, and many other things. —The value of the commerce of Italy in 1871 was 2,048,000,000 francs, as follows: imports 1,085,000,000 francs; and exports, 963,000,000 francs. The principal exports were: cereals, 101,000,000 francs; fruits, flowers and fodder, 60,000,000 francs; silk, 383,000,000 francs; straw hats. 11,000,000 francs; olive oil, 126,000,000 francs; chemical products, 24,000,000 francs; wines, 14,000,000 francs; live stock. 59,500,000 francs. The commercial operations of the ten years 1862-71, not including transit trade, are represented in the following table:  The following table exhibits the total revenue and expenditure of Italy, together with the annual deficits in each of the years 1875-9:42 The following are the budget estimates for the year 1881:
According to these returns, there was a deficit of 1,402,179 lire in 1881, which supplementary, or extraordinary expenses, incurred afterward, increased largely, the amount of which, however, was not made public. —The public debt at the end of 1878, was made up of the following liabilities:
As a guarantee for the issued treasury bonds and of paper currency, which has a forced circulation, the government has deposits of certificates of the funded debt, bearing no interest, in the national bank of Italy. The total amount of these deposits was calculated at 1,150,000,000 lire, at the end of 1878—The following table shows the total imports and exports of the kingdom in each of the five years 1876-80:  —Italy possessed in 1871. 6,287 kilometres of railways in operation; 7,800 kilometres of national highway; 19,600 kilometres of provincial roads, and 90,000 kilometres of communal roads. In 1876 it had 7,704 kilometres of railways, and in 1879, 8,210 kilometres. —If we should now compare the actual state of affairs of Italy with that existing prior to the formation of the kingdom, we should at once see the immense intellectual, material and economical progress that has been made within a few years; in a word, the great rapidity with which Italy has advanced on the road to civilization. She may well congratulate herself on her political unity, achieved after so much effort. —BIBLIOGRAPHY. Muratori, Archivio storico italiano, 1838, and Annali d'Italia, 12 vols., Milan; Coppi. Annali d'Italia dal 1750-1861. Florence, 1848. The Works of Bossi, 19 vols., Milan, 1819, Campiglio, 7 vols., Milan, 1837-67, Balbo, Turin, 1841; CantȒ, Storia degli Italiani, 6 vols., Turin, 1854, 4 vols., 1859, Lebret. Geschichte con Italien, 9 vols., Halle, 1778-87. Leo, Geschichte der italienischen Stuaten, 3 vols., Hamburg and Gotha, 1829-32, Sismondi, Histoire des républiques italiennes du moyen áge, 16 vols., Paris, 1809-18; Troya, Storia d'Italia del medio evo, 3 vols., Naples, 1839-51; Morbio, Storia de'municipj italiani, 6 vols., Milan, 1841-6; La Farina, Studj sul secola XIII, Florence, 1842; Hegel, Geschichte der Stadleverfassung von Italien, 2 vols., Leipzig, 1847. Ferrari, Histoire des révolutions d'Italie, 4 vols., Paris, 1858; Reuchlin, Geschichte Italiens ron der Grundung der regiereaden Dynasticu bis auf die Gegenarait, 4 vols., Leipzig. 1859-73; Montanelli, Memorie sull' Italia del 1814 al 1850, 2 vols., Turin, 1854-5; La Farina, Storia d'Italia del 1815 al 1850. 2d ed., 2 vols., Milan, 1864; Bianchi, Storia della diplomazia europea in Italia dal 1815 al 1861. Turin, 1865-72, Butt, The History of Italy from the Abdication of Napoleon I., 2 vols., London, 1860. Rey, Histoire de la renaissance politique de l'Italie. 1814-61. Paris, 1864; Anelli, Storia d'Italia dal 1814 al 1863, 4 vols., Milan. 1864; Gualterio, Gli ultimi rivolgimenti italiani. Florence, 1852; Ranalli, Le isterie italiane dal 1846 al 1853, Florence, 1855, La Marmora. Un po' piȒ di luce. Florence, 1873; Hillebrand, Italia, Leipzig. 1874. Bodio, Lui documenti statistici del Regno d'Italia, cenni bibli grafici, presentati al VI. Congresso internazionale di statistica, Florence, 1868; Cesare, Il Passato, il Presente e l'avennire della Pubblica Amministrazione nel Regno d'Italia, Florence, 1865; Fornelli, Miscellanea geografico storico politica su l'Italia, Naples, 1869; Gallenga, Italy Revisited, 2 vols., London. 1876, Laveleye, L'Italie actuelle, Paris, 1881; Lossa, Annuario del commercio ed industria del Regno d'Italia. Florence, 1881; Morpurgo, La Finanza Italiana della Fandazione del Regno fino a questi Giorni. Rome, 1874; Muzzi, Vocabolario geografico storico-statistico dell Italia, 2 vols., Bologna, 1873-4; Stivieri, Geografici e statistica commerciale del Regno d'Italia. Venice, 1879; Wrightson, History of Italy from the French Revolution to 1850. London, 1855: Arrivabene, Italy under King Victor Emmanuel, 2 vols., London, 1862; Alford, Letters from Abroad, 2d ed., London, 1865; Taine, Voyage en Italie, 2 vols Paris, 1866, English translation by J. Durand, 2 vols., New York, 1869, 1 vol., 1874. GASPAR FINALI. [25.]Vattel, book iii., chap. xv., § 232, asks no more than this. He is satisfied with aid since it seems impossible to him to indemnify every one for the damages caused by the chances of war. Grotius, book iii., chap. xx., § 8, recognized the solidarity of the nation. [26.]The "Times," of Aug. 9, 1871, in giving an account of the above discussion, in a leader, treats the doctrine of national solidarity with reference to acts of war (first part of proposition) as extravagant theories, and recalls the fact that, in a similar case, Cavour held analogous language, in 1859, which was approved by the parliament of Turin. For our own part, we can not admit recruiting by lot, and many other institutions which impose sacrifices on some citizens for the advantage of all, unless we rest on the principles of solidarity. [27.]Passy's report will be found in the Journal Officiel of the first days of April, 1873. [28.]"Not that the laws of the convention ever meant to proclaim the principle of absolute liberty in the matter of interest. It would be an error to suppose this: they only intended to remove the prohibitions on payments in money." (Troplong.) [30.]What good use was made of this alternative is shown by what Gallatin wrote in 1801; that, owing to improved methods of manufacture, distilleries had reduced the tax to three cents per gallon, and in a short time, by further improvements, would reduce it to three-fifths of one cent per gallon. [31.]Cours d' Economie Politique, 1st vol., 2d lesson. From this work we borrow such of these facts as relate to the mill of St. Maur, to iron and to spinning, which are presented there more in detail. [32.]The present rate of production (July, 1881) in the flouring mills of Washburn, Crosby 8 Co, Minneapolis, Minn., is such that the average product of a man's labor is the flour required for 3,983 persons, allowing three-fourths of a pound daily per individual, and considering that consumption continues one day more per week than product on. These mills employ 281 men (who work twelve hours per day—a part from noon to midnight and a part from midnight to noon, exclusive of workmen not connected directly with milling, such as carpenters, millwrights, machinists and laborers. The total daily production with this force is 5,000 barrels of flour per day of twenty-four hours.—E. J. L. [33.]A blast furnace now in operation in Kentucky has run off forty tons of iron per day for several successive days. By the aid of recent improvements, a better quality of metal is obtained from very refractory ores than was formerly obtained from ore more easily worked.—E. J. L. [34.]Watt took out a patent for his invention in 1769, and in 1775 obtained from parliament a prolongation of his patent for twenty-five years. (See Chambers' Encyc., Art. Watt.)—E. J. L. [35.]The Walter machine, on which the London "Times" and the New York "Times" are printed, gives 11,000 perfected sheets an hour. The Victory press will print, cut, fold, and paste at the back a twenty-four page sheet at the rate of 7,000 an hour. The Hoe perfecting press will give 12,000 or more perfected sheets in an hour. (See Appleton's Cyclopædia, 1880.) [36.]Montesquieu said: "Those machines which aim to shorten the process are not always useful. If an article sells at a middling price one equally advantageous for the buyer and the workman who made it, any machines which should simplify the process of manufacture, that is to say, which should diminish the number of workmen, would be injurious; and it mills propelled by water power were not established everywhere, I should not believe them as advantageous as people say they are, because they have deprived a great number of people of an opportunity to work cut off the use of the water from many fields, and have made many others lose their fruitfulness.' (Esprit des Lois, book xviii., chap. xv.) We reproduce here the whole substance of Montesquieu on this subject. We should remark that the illustrious publicist knew nothing of the marvels of modern industry, and that he wrote before Adam Smith and his successors had thrown upon economic questions the light to which his superior reason would not have been insensible. [37.]Ce qu'on voit et ce qu'on ne voit pas. (What people see, and what they do not see), brochure in 16mo, p. 50. (This pamphlet is one of Bastiat's essays on Political Economy, and included in the published American translation of the same.)—E. J. L. [38.]In England, before the invention of machines, there were estimated to be only 5,200 spinners at small wheels, and 2,700 weavers; in all, 7,900 workmen, while in 1787, ten years after the number of spinners, according to the report of an investigating committee, was estimated at 105,000, and of weavers, 217,000; in all, 352,000 workmen. Since then, machinery has changed, the same work is performed with much fewer workmen, and steam has taken the place of men in many kinds of labor, and yet the number of workmen has increased. Mr. Barnes, in his "History of the Cotton Manufacture,' (London, 1835), has shown that in 1883 there were 237,000 workmen spinning or weaving at machines, and 230 000 weaving by hand, in all, 487,000 persons. By grouping the workmen in the side industries, such as cloth printing, tulles, cap making, etc., Mr. Barnes reaches 800,000 or 1,500,000, if the old men, women and children are counted; and 2,000,000. if he includes the joiners and masons who build the factories, and the locksmiths who make the machines, without counting the women and the old men. [39.]Ricardo (chap. xxxi. of his "Principles" added to the 4th edition, translated into French in the Collection des Principaux Economistes,) examines the exceptional and theoretical case of sudden invention and application. He shows, likewise, that, in certain given cases, the invention or the industrial improvement may augment the net product while diminishing the raw product, and may displace workmen. But Ricardo is not on that account hostile to inventions. He says (p. 240, M'Culloch's edition): "The statements which I have made will not, I hope, lead to the inference that machinery should not be encouraged. To elucidate the principle, I have been supposing that improved machinery is suddenly discovered, and extensively used; but the truth is, that these discoveries are gradual, and rather operate in determining the employment of the capital which is saved and accumulated, than in diverting capital from its actual employment." (See, farther on, another quotation from the same author.) [40.]It is calculated that in 1847 the population was about 9,500,000. [41.]A worthy counterpart to this defense of Limerick was the heroic conduct of the Protestant Williamite garrison and population of Derry, who, despite the most cruel privations, gallantly kept the city against a Stuart-Irish besieging force, until the arrival of a relieving expedition. [42.]Surplus. |
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