BOOK V. ON THE INFLUENCE OF GOVERNMENT. CHAPTER L OF THE FUNCTIONS OF GOVERNMENT IN GENERAL. § 1. ONE of the most disputed questions both in political science and in practical statesmanship at this particular period, relates to the proper limits of the functions and agency of governments. At other times it has been a subject of controversy how governments should be constituted, and according to what principles and rules they should exercise their authority; but it is now almost equally a question, to what departments of human affairs that authority should extend. And when the tide sets so strongly towards changes in government and legislation, as a means of improving the condition of mankind, this discussion is more likely to increase than to diminish in interest. On the one hand, impatient reformers, thinking it easier and shorter to get possession of the government than of the intellects and dispositions of the public, are under a constant temptation to stretch the province of government beyond due bounds: while, on the other, mankind have been so much accustomed by their rulers to in*erference for purposes other than the public good, or under an erroneous conception of what that good requires, and so many rash proposals are made by sincere lovers of improvement, for attempting, by compulsory regulation, the attainment of objects which can only be effectually or only usefully compassed by opinion and discussion, that there has grown up a spirit of resistance in limine to the interference of government, merely as such, and a disposition to restrict its sphere of action within the narrowest bounds. From differences in the historical development of different nations, not necessary to be here dwelt upon, the former excess, that of exaggerating the province of government, prevails most, both in theory and in practice, among the Continental nations, while in England the contrary spirit has hitherto been predominant. The general principles of the question, in so far as it is a question of principle, I shall make an attempt to determine in a later chapter of this Book: after first considering the effects produced by the conduct of government in the exercise of the functions universally acknowledged to belong to it. For this purpose, there must be a specification of the functions which are either inseparable from the idea of a government, or are exercised habitually and without objection by all governments; as distinguished from those respecting which it has been considered questionable whether governments should exercise them or not. The former may be termed the necessary, the latter the optional, functions of government. By the term optional it is not meant to imply, that it can ever be a matter of indifference, or of arbitrary choice, whether the government should or should not take upon itself the functions in question; but only that the expediency of its exercising them does not amount to necessity, and is a subject on which diversity of opinion does or may exist. on principles of general expediency who shall take the succession? and in case the successor is in any manne incompetent, does it not appoint per sons, frequently officers of its own, to collect the property and apply it to his benefit? There are many other case in which the government undertake the administration of property, because the public interest, or perhaps ozir that of the particular persons co cerned, is thought to require it. This is often done in cases of litigated pro perty; and in cases of judicially de clared insolvency. It has never been contended that in doing these things, a government exceeds its province. § 2. In attempting to enumerate the necessary functions of government, we find them to be considerably more multifarious than most people are at first aware of, and not capable of being circumscribed by those very definite lines of demarcation, which, in the inconsiderateness of popular discussion, it is often attempted to draw round them. We sometimes, for example, hear it said that governments ought to confine themselves to affording protection against force and fraud: that, these two things apart, people should be free agents, able to take care of themselves, and that so long as a person practises no violence or deception, to the injury of others in person or proNor is the function of the law in de perty, legislatures and governments fining property itself, so simple a thing are in no way called on to concern as may be supposed. It may be ima themselves about him. But why should gined, perhaps, that the law has only people be protected by their govern- to declare and protect the right ment, that is, by their own collective every one to what he has himself pr strength, against violence and fraud, duced, or acquired by the voluntary and not against other evils, except that consent, fairly obtained, of those wh the expediency is more obvious? If produced it. But is there nothing re nothing, but what people cannot pos- cognised as property except what has sibly do for themselves, can be fit to be been produced? Is there not the earth done for them by government, people itself, its forests and waters, and a might be required to protect them-other natural riches, above and below selves by their skill and courage even the surface? These are the inher against force, or to beg or buy protectance of the human race, and there tion against it, as they actually do where the government is not capable of protecting them: and against fraud every one has the protection of his own wits. But without further anticipating the discussion of principles, it is sufficient on the present occasion to consider facts. must be regulations for the commen Under which of these heads, the repression of force or of fraud, are we to place the operation, for example, of the Again, the legitimacy is conceded faws of inheritance? Some such laws repressing violence or treachery; must exist in all societies. It may be under which of these heads are we to said, perhaps, that in this matter go-place the obligation imposed on peop vernment has merely to give effect to to perform their contracts? Non-per the disposition which an individual formance does not necessarily in makes of his own property by will. fraud; the person who entered into the This, however, is at least extremely contract may have sincerely intende disputable; there is probably no coun- to fulfil it: and the term fraud, which try by whose laws the power of testa- can scarcely admit of being exten mentary disposition is perfectly abso- even to the case of voluntary breach lute. And suppose the very common contract when no deception was prac case of there being no will: does not tised, is certainly not applicable when the law, that is, the government, decide the omission to perform is a case of contracts, and of the relations which they establish among human beings, is a question for the legislator; and one which he cannot escape from con sidering, and in some way or other deciding. Degligence. Is it no part of the duty governments to enforce contracts? Here the doctrine of non-interference would no doubt be stretched a little, and it would be said, that enforcing contracts is not regulating the affairs of individuals at the pleasure of govern- Again, the prevention and suppresment, but giving effect to their own sion of force and fraud afford approexpressed desire. Let us acquiesce in priate employment for soldiers, police this enlargement of the restrictive men, and criminal judges; but there theory, and take it for what it is worth. are also civil tribunals. The punishBut governments do not limit their ment of wrong is one business of an concern with contracts to a simple en- administration of justice, but the deforcement. They take upon themselves cision of disputes is another. Innuto determine what contracts are fit to merable disputes arise between perbe enforced. It is not enough that one sons, without mala fides on either side, person, not being either cheated or through misconception of their legal compelled, makes a promise to another. rights, or from not being agreed about There are promises by which it is not the facts, on the proof of which those for the public good that persons should rights are legally dependent. Is it have the power of binding themselves. not for the general interest that the To say nothing of engagements to do State should appoint persons to clear something contrary to law, there are up these uncertainties and terminate engagements which the law refuses to these disputes? It cannot be said to enforce, for reasons connected with the be a case of absolute necessity. People interest of the promiser, or with the might appoint an arbitrator, and engeneral policy of the state. A contract gage to submit to his decision; and by which a person sells himself to an- they do so where there are no courts other as a slave, would be declared of justice, or where the courts are not void by the tribunals of this and of trusted, or where their delays and most other European countries. There expenses, or the irrationality of their are few nations whose laws enforce a rules of evidence, deter people from contract for what is looked upon as resorting to them. Still, it is uniprostitution, or any matrimonial en-versally thought right that the State gagement of which the conditions vary in any respect from those which the law has thought fit to prescribe. But when once it is admitted that there are any engagements which for reasons of expediency the law ought not to enforce, the same question is necessarily opened with respect to all engagements. Whether, for example, the law should enforce a contract to labour, when the wages are too low, or the hours of work too severe: whether it should enforce a contract by which a person binds himself to remain, for more than a very limited period, in the service of a given individual: whether a contract of marriage, entered into for life, should continue to be enforced against the deliberate will of the persons, or of either of the persons, who entered into it. Every question which can possibly arise as to the policy of P.E. should establish civil tribunals; and if their defects often drive people to have recourse to substitutes, even then the power held in reserve of carrying the case before a legally constituted court, gives to the substitutes their principal efficacy. Not only does the State undertake to decide disputes, it takes precautions beforehand that disputes may not arise. The laws of most countries lay down rules for determining many things, not because it is of much consequence in what way they are determined, but in order that they may be determined somehow, and there may be no question on the subject. The law prescribes forms of words for many kinds of contract, in order that no dispute or misunderstanding may arise about their meaning: it makes provision that if a dispute does arise, evidence II shall be procurable for deciding it, by requiring that the document be attested by witnesses and executed with certain formalities. The law preserves authentic evidence of facts to which legal consequences are attached, by keeping a registry of such facts; as of births, deaths, and mariages, of wills and contracts, and of judicial proceedings. In doing these things, it has never been alleged that government oversteps the proper limits of its functions. Again, however wide a scope we may allow to the doctrine that individuals are the proper guardians of their own interests, and that government owes nothing to them but to save them from being interfered with by other people, the doctrine can never be applicable to any persons but those who are capable of acting in their own behalf. The individual may be an infant, or a lunatic, or fallen into imbecility. The law surely must look after the interests of such persons. It does not necessarily do this through officers of its own. It often devolves the trust upon some relative or connexion. But in doing so is its duty ended? Can it make over the interests of one person to the control of another, and be excused from supervision, or from holding the person thus trusted, responsible for the discharge of the trust? There is a multitude of cases in which governments, with general approbation, assume powers and execute functions for which no reason can be assigned except the simple one, that they conduce to general convenience. We may take as an example, the function (which is a monopoly too) of coining money. This is assumed for no more recondite purpose than that of saving to individuals the trouble, delay, and expense of weighing and assaying. No one, however, even of those most jealous of state interference, has objected to this as an improper exercise of the powers of government. Prescribing a set of standard weights and measures is another instance. Paving, lighting, and cleansing the streets and tho roughfares, is another; whether done by the general government, or, as is more usual, and generally more ad visable, by a municipal authority. Making or improving harbours, building lighthouses, making surveys in order to have accurate maps and charts, raising dykes to keep the sea out, and embankments to keep rivers in, are cases in point. Examples might be incefinitely mul tiplied without intruding on any disputed ground. But enough has been said to show that the admitted functions of government embrace a much wider field than can easily be included within the ring-fence of any restrictive definition, and that it is hardly possible to find any ground of justification common to them all, except the comprehensive one of general expediency; nor to limit the interference of government by any univérsal rule, save the simple and vague one that it should never be admitted but when the case of expediency is strong. § 3. Some observations, however, may be usefully bestowed on the nature of the considerations on which the question of government interference is most likely to turn, and on the mode of estimating the comparative magnitude of the expediencies involved. This will form the last of the three parts into which our discussion of the principles and effects of government interference may veniently be divided. The following will be our division of the subject. Con We shall first consider the economical effects arising from the manne in which governments perform their necessary and acknowledged functions. We shall then pass to certain governmental interferences of what I have termed the optional kind (i.e. overstepping the boundaries of the universally acknowledged functions) which have heretofore taken place, and in some cases still take place, under the influence of false general theories. It will lastly remain to 'nquire whether, independently of any faise theory, and consistently with a correct view of the laws which regulate human affairs, there be any cases of the optional class in which governmental interference is really advisable, and what are those cases. to consider, may be reduced to the following general heads. First, the means adopted by governments to raise the revenue which is the condition of their existence. Secondly, the nature of the laws which they prescribe on the two great subjects of Property and Contracts. Thirdly, the excellences or defects of the system of means by which they enforce generally the execution of their laws, namely, their judicature and police. The first of these divisions is of an extremely miscellaneous character: since the necessary functions of government, and those which are 80 manifestly expedient that they have never or very rarely been objected to, are, as already pointed out, too various to be brought under any very simple classification. Those, however, which are of principal importance, which alone it is necessary heretion. We commence with the first head, that is, with the theory of Taxa CHAPTER IL ON THE GENERAL PRINCIPLES OF TAXATION. 1. THE qualities desirable, economically speaking, in a system of taxation, have been embodied by Adam Smith in four maxims or principles, which, having been generally concurred in by subsequent writers, may be said to have become classical, and this chapter cannot be better commenced than by quoting them.* "1. The subjects of every state ought to contribute to 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. In the observation or neglect of this maxim consists what is called the equality or inequality of taxation. "2. The tax which each individual is bound to pay ought to be certain, and not arbitrary. The time of payment, the manner of payment, the quantity to be paid, ought all to be clear and plain to the contributor, and to every other person. Where it is otherwise, every person subject to the tax is put more or less in the power of • Wealth of Nations, book v. ch ii, the taxgatherer, who can either aggra vate the tax upon any obnoxious contributor, or extort by the terror of such aggravation, some present or perqui site to himself. The uncertainty of taxation encourages the insolence and favours the corruption of an order of men who are naturally unpopular, even when they are neither insolent nor corrupt. The certainty of what each individual ought to pay is, in taxation, a matter of so great importance, that a very considerable degree of inequality, it appears, I believe, from the experience of all nations, is not near so great an evil, as a very small degree of uncertainty. "3. Every tax ought to be levied at the time, or in the manner, in which it is most likely to be convenient for the contributor to pay it. A tax upon the rent of land or of houses, payable at the same term at which such rents are usually paid, is levied at a time when it is most likely to be convenient for the contributor to pay; or when he is most likely to have wherewithal to pay. Taxes upon such consumable goods as are articles of luxury, are all |