lars. Facts of this sort are observed everywhere. Farms may, as a general rule, be bought, especially in all the older States, at much less than their cost, after making all due allowances for depreciation of buildings, &c. We observe, first, that buildings are not generally put upon farms for the purpose of selling or letting them. They are almost invariably erected by the owners of the land, in order to create for themselves a home. To make that home pleasant and desirable, a dwelling is erected according to the tastes of the owner and his family, rather than the direct profit of the farm. There is a natural and becoming competition among agriculturists to have pleasant, and, as far as may be, elegant residences. Hence, they build upon a more expensive scale than the business of agriculture will fully justify; and though they may be able to keep on, and even thrive, with their establishments, these are, nevertheless, a heavy charge upon their industry. Whenever, therefore, such farming properties must be sold, the purchaser will rarely, if ever, give more than a fraction of the original cost of the buildings. If, as is generally the case, he must make the money off his land to pay for the estate, he cannot afford the cost of buildings erected to gratify the taste of somebody else. He gets the extra improvements gratis, really paying only for the useful and necessary. And, in the competition of cultivation in a community like the United States, it is to be remembered that its agriculture is a unit; that the products of the accessible and fertile prairies of the West are brought into the same markets as those of the hard and sterile hills of New England. And it is also to be taken into account, that a farm in Illinois, for example, with a productive power of five thousand bushels of corn, will probably not have upon it buildings worth more than one thousand dollars; while on many Eastern farms, of a productive power of but two thousand bushels, the buildings may have cost three thousand dollars. Now, as these farms are, in fact, competing in the same gen eral markets, it is clear that the extra expenditures upon Eastern farms can pay but little, if any, rental, though they may be very pleasant to the occupant. It is on the same principle that the amount expended in clearings, building walls around farms, and the like, do not, in the aggregate, return much rent or income, compared with their cost. They become, in the progress of years, to a considerable extent, like the gifts of nature, gratuitous. This is true of all countries, at all times. In cities, where the value of real estate consists principally of buildings, and improvements made upon the land, we find that the land itself feels the operation of the first cause of rent or value, viz. location, far more intensely than anywhere else. An acre of land, once of the value of fifty dollars for agriculture, becomes worth five hundred thousand dollars for city purposes. Such, and even more extraordinary, instances may be found, showing to what extent the principle of location may be carried. The estimated wealth of cities consists, to a considerable extent, of the appreciation in the value of land which the increasing density of population and the concentration of business enterprise has occasioned. Investments in commercial cities depend, of course, for success, upon commercial prosperity. Changes likewise take place in the business centres of every great city. There is much of mere whim and fashion in this; but, whether the commerce and trade of the city moves "up town" or "down town," rents move with it. City property, in all thrifty communities, is sure, on the whole, to advance in value with the lapse of time; and hence it is always a favorite investment. Yet so great is the competition, so large the amount of capital in cities, that the net average rental is probably not greater than the ordinary rate of interest. Rents are based on permanent property that requires much care; interest, upon securities that may prove worthless, but which demand but little attention. by State authority. The national government imposes taxes in every form, direct and indirect, except upon the poll. The State governments generally rely upon direct taxation; and the poll-tax is one of the forms adopted. Under State authority, counties, cities, towns, and schooldistricts impose taxes; so, also, parishes and religious corporations: but the latter, generally, only on voluntary membership. Taxes may first be divided into two kinds,-direct and indirect. A direct tax is demanded of the person who it is intended shall pay it. Indirect taxes are demanded from one person, in the expectation that he will indemnify himself at the expense of others. Such are customs and excise. In our further examination of the subject, we shall refer to the national taxation of the United States, and the State taxation of Massachusetts; selecting the latter State only for being the most convenient, and as representing that of the individual States generally with considerable exactness. CHAPTER X. NATIONAL TAXATION. - I. CUSTOMS. THESE are taxes upon importations, and collected through the custom-houses. Government establishes a tariff; that is, a list of duties upon such articles as it deems best: these are paid by the importer before he can gain possession of his goods. Duties are generally of two kinds, - specific and ad-valorem. Specific duties are imposed by the pound, yard, gallon, &c. Ad-valorem duties, as the term imports, are charged upon the value of the goods, as twenty per cent upon an invoice of silks, hardware, sugar, &c. In some of the American tariffs, the specific principle has predominated; in others, the ad-valorem. There has always been a struggle when the tariff was to be changed; those favoring specific duties, for protection, being in favor of spe cific, those of the opposite views contending for ad-valorem duties. There are difficulties attending both. If specific duties are laid, they operate with great inequality. For example,. suppose a duty of twenty-five cents per pound upon tea. This would be equal to a taxation of one hundred per cent on that which cost, originally, twenty-five cents, which the poor man must pay; while the rich, who would purchase tea that cost seventy-five cents, would pay but thirty-three per cent, or one-third as much per cent as the former. This was the character, to a large extent, of British taxation. The tax on tea was, for a long time, two shillings and sixpence per pound (over sixty cents), paid alike by the hand-loom weaver and the wealthy nobleman. When laid upon cloth, for example, a specific duty frequently operates in a most oppressive manner. By the American tariff of 1828, a duty of so many cents was laid. upon the square yard of coarse woollens. In applying the principle, it was found that negro cloths, as they were called, paid more than two hundred and fifty per cent. This gave rise to great dissatisfaction, and was the ostensible cause of the nullification movement. In regard to ad-valorem duties, the practical difficulty has been, when the rates were very high, to prevent fraudulent invoices. For example, the importer must present his original invoice at the custom-house, and make oath to its correctness. If dishonest, he may, by connivance with the shipper, furnish false papers, showing the cost to be much less than it really was. Precautionary measures have been adopted. Appraisers have been appointed to determine the actual value; but, with all possible care on the part of the government, there is danger of deception, and consequent loss to the revenue, as well as injustice to the honest importer. Of all modes of raising a revenue, that by customs is confessedly the most effective, and the most readily accomplished; and its great importance, as one of the chief sources of national revenue, demands that we give it careful con sideration. The first principle we laid down was "that all should contribute, as nearly as possible, in proportion to their respective abilities." As all duties are laid upon articles of general consumption, it will at once be seen that such taxation cannot have an equal bearing, because men are thus taxed in proportion to what they consume, not in proportion to their wealth. The poor man, with a large family, may pay more than a millionnaire. A case is personally known to us of one of the latter class, who actually paid less on dutiable articles than a printer, with a family, who received but fifteen dollars a week. Men are taxed in this way according to the mouths they have to feed, and the bodies they have to clothe. In the second place, we inquire, Is "the time and manner plain to the person who pays" this indirect tax? The farmer who purchases a carriage, -is he aware that he is paying a government tax by so doing? If so, does he know how much he is paying? Does he understand that all the materials, except the wood, have paid duties to government; that the linings, trimmings, and ornaments, the paints and varnish, and the tools with which it was made, have all been taxed; and that he is to pay the sum total of the whole? Even if so, can he or any one else easily compute the amount of taxation which enters into the carriage? So of all commodities which have passed through the custom-house: people seldom realize when or how much they are taxed. Then the second principle we have laid down is violated. But we shall not have a full view of the operation of duties on foreign merchandise, unless we take into consideration the fact that they raise the price of the home product, if there is one, to an equal degree with the foreign article, |