committee prepares and reports to the House the bills needed for imposing or continuing the various customs duties, excise duties, etc. The report of the Secretary has been referred by the House to this committee, but the latter does not necessarily base its bills upon or in any way regard that report. Neither does it in preparing them start from an estimate of the sums needed to support the public service. It does not, because it cannot; for it does not know what grants for the public service will be proposed by spending committees, since the estimates submitted in the Secretary's letter furnish no trustworthy basis for a guess. It does not, for the further reason that the primary object of customs duties has for many years past been not the raising of revenue, but the protection of American industries by subjecting foreign products to a very high tariff. This tariff, which was further raised in 1890, has brought in an income far exceeding the current needs of the government. Two-thirds of the war debt having been paid off, the fixed charges have shrunk to one-third of what they were when the war ended, yet this tariff remained till 1890 with few modifications, surpluses constantly accumulating in the national treasury, until in that year a Pension Act was passed which increased expenditures so largely as almost to absorb even the growing surplus. The Committee of Ways and Means has therefore had no motive for adapting taxation to expenditure. The former will be always in excess so long as the protective tariff stands, and the protective tariff stands for commercial or political reasons unconnected with national finance.

When the revenue bills come to be debated in committee of the whole House similar causes prevent them from being scrutinized from the purely financial point of view. Debate turns on those items of the tariff which involve gain or loss to influential groups. Little inquiry is made as to the amount needed and the adaptation of the bills to produce that amount and no more. It is the same with ways and means bills in the Senate. Communications need not pass between the committees of either House and the Treasury.

The person most responsible, the person who most nearly corresponds to an English Chancellor of the Exchequer, or a French Minister of Finance, is the chairman of the House Committee of Ways and Means. But he stands in no official relation to the Treasury, and is not required to exchange a word or a letter with its staff. Neither, of course, can he count on a majority in the House. Though he is a leading man he is not a leader, i. e., he has no claim on the votes of his own party, many of whom may disapprove of and cause the defeat of his proposals. This befell in 1886, when the chairman of this committee, an able man, and perhaps, after the Speaker, the most considerable person in the Democratic majority, was beaten in his attempted reform of the tariff.

The business of spending money used to belong to the Committee on Appropriations, but in 1883 a new committee, that on Rivers and Harbours, received a large field of expenditure; and in 1886 sundry other supply bills were referred to sundry standing committees. The Committee on Appropriations starts from, but does not adopt, the estimates sent in by the Secretary of the Treasury, for the appropriation bills it prepares usually make large and often reckless reductions in these estimates. The Rivers and Harbours Committee proposes grants of money for what are called “internal improvements," nominally in aid of navigation, but practically in order to turn a stream of public money into the State or States where each "improvement" is to be executed. More money is wasted in this way than what the parsimony of the Appropriations Committee can save. Each of the other standing committees, including the Committee on Pensions, a source of infinite waste, proposes grants of money, not knowing nor heeding what is being proposed by other committees, and guided by the executive no further than the members choose. All the expenditures recommended must be met by appropriation bills, but into their propriety the Appropriation Committee cannot inquire.

Every revenue bill must, of course, come before the House;

and the House, whatever else it may neglect, never neglects the discussion of taxation and money grants. These are discussed as fully as the pressure of work permits, and are often added to by the insertion of fresh items, which members interested in getting money voted for a particular purpose or locality suggest. These bills then go to the Senate, which forthwith refers them to its committees. The Senate committee on finance deals with the revenue-raising bills; the Committee on Appropriations with supply bills. Both sets then come before the whole Senate. Although it cannot initiate revenue-raising bills, the Senate long ago made good its claim to amend appropriation bills, and does so freely, adding items and often raising the total of the grants. When the bills go back to the House, the House usually rejects the amendments; the Senate adheres to them, and a Conference Committee is appointed, consisting of three senators and three members of the House, by which a compromise is settled, hastily and in secret, and accepted, generally in the last days of the session, by a hard-pressed but reluctant House. Even as enlarged by this committee, the supply voted is often found inadequate, so a deficiency bill is introduced in the following session, including a second series of grants to the departments.

The European reader will ask how all this is or can be done by Congress without frequent communication from or to the executive government. There are such communications, for the ministers, anxious to secure appropriations adequate for their respective departments, talk to the chairmen and appear before the committee to give evidence as to departmental needs. But Congress does not look to them for guidance as in the early days it looked to Hamilton and Gallatin. If the House cuts down their estimates they turn to the Senate and beg it to restore the omitted items; if the Senate fail them, the only resource left is a deficiency bill in the next session. If one department is so starved as to be unable to do its work, while another obtains lavish grants which invite jobbery or waste, it is the committees, not the executive, whom the peo

ple ought to blame. If, by a system of log-rolling, vast sums are wasted upon useless public works, no minister has any opportunity to interfere, any right to protest. A minister cannot, as in England, bring Congress to reason by a threat of resignation, for it would make no difference to Congress if the whole cabinet were to resign, unless of course the congressmen most conspicuously concerned should be so palpably in fault that the people could be roused to vigorous disapproval.

What I have stated may be summarized as follows:

There is practically no connection between the policy of revenue raising and the policy of revenue spending, for these are left to different committees whose views may be opposed, and the majority in the House has no recognized leaders to remark the discrepancies or make one or other view prevail. In the forty-ninth Congress a strong free-trader was chairman of the tax-proposing Committee on Ways and Means, while a strong protectionist was chairman of the spending Committee on Appropriations.

There is no relation between the amount proposed to be spent in any one year, and the amount proposed to be raised. But for the fact that the high tariff has, until quite recently, produced a large annual surplus, financial breakdowns must have ensued.

The knowledge and experience of the permanent officials either as regards the productivity of taxes, and the incidental benefits or losses attending their collection, or as regards the nature of various kinds of expenditure and their comparative utility, can be turned to account only by interrogating these officials before the committees. Their views are not stated in the House by a parliamentary chief, nor tested in debate by arguments addressed to him which he must there and then


Little check exists on the tendency of members to deplete the public treasury by securing grants for their friends or constituents, or by putting through financial jobs for which they are to receive some private consideration. If either

the majority of the Committee on Appropriations or the House itself suspects a job, the grant proposed may be rejected. But it is the duty of no one in particular to scent out a job, and to defeat it by public exposure.

The nation becomes so puzzled by a financial policy varying from year to year, and controlled by no responsible leaders, as to feel diminished interest in congressional discussions and diminished confidence in Congress.


The result on the national finance is unfortunate. thoughtful American publicist remarks, "So long as the debit side of the national account is managed by one set of men, and the credit side by another set, both sets working separately and in secret without public responsibility, and without intervention on the part of the executive official who is nominally responsible; so long as these sets, being composed largely of new men every two years, give no attention to business except when Congress is in session, and thus spend in preparing plans the whole time which ought to be spent in public discussion of plans already matured, so that an immense budget is rushed through without discussion in a week or ten days-just so long the finances will go from bad to worse, no matter by what name you call the party in power. No other nation on earth attempts such a thing, or could attempt it without soon coming to grief, our salvation thus far consisting in an enormous income, with practically no drain for military expenditure."

It may be replied to this criticism that the enormous income, added to the fact that the tariff is imposed for protection rather than for revenue, is not only the salvation of the United States Government under the present system, but also the cause of that system. Were the tariff framed with a view to revenue only, no higher taxes would be imposed than the public service required, and a better method of balancing the public accounts would follow. This is true. The present state of things is evidently exceptional. America is the only country in the world whose difficulty is not to raise

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