Per $1000

Per $1000

Per $1000

sent per $1000 of national wealth as compiled at the various census periods mentioned. The proportion per $1000 of national wealth of the taxes levied to meet the expenditure, including schools, for government other than federal, from 1860 to 1902, and the grand total of expenditure for government, exclusive of federal, compiled only at the Eleventh and Twelfth Censuses, are also presented.

The expenditures of the national government payable from taxation may be compared with the general property taxes levied for the support of state and municipal governments. The tax levies for state and municipal governments were ascertained by the Bureau of the Census for 1880, 1890, and 1902. For 1880 the per capita of such levies was $6.26, and in 1902, $9.22. In twenty-two years it increased 47.3 per cent. The per capita of national expenditures payable from taxation in 1880 was $5.28, and in 1902, $5.91, and in 1907, $6.77. The percentage of increase from 1880 to 1902 was 12, and from 1880 to 1907 only 28.2. The former was only a fourth and the latter barely 60 per cent of the corresponding percentage of increase of state and local taxation for twenty-two years. State and local taxation is increasing proportionately with national wealth and the ability of the people to meet the added costs of local government, while national expenditures - though growing rapidly do not keep pace with the increasing national wealth; and so the burden of national government becomes smaller and smaller with the passing of the decades at least, that has been the general trend of affairs since the middle of the nineteenth century, in spite of the cost of the Civil War with its legacy of heavy interest and pension charges.

APPENDIX B

BUDGET PROCEDURE IN THE HOUSE OF REPRESENTATIVES

In answer to an application from the author, the following account of Budget Procedure was furnished, under date of October 13, 1909, by the Hon. James A. Tawney, Chairman of the Committee on Appropriations:

"Prior to the enactment of Section 7 of the sundry civil appropriation act, approved March 4, 1909, the law only required the heads of the several executive departments of the government to submit their estimates for the next fiscal year's expenditures to the Secretary of the Treasury on or before October 15th of each year. It was then made the regular duty of the Secretary of the Treasury to arrange and compile these estimates thus submitted, have them printed, and transmit the same to Congress on the opening day of the session. Under this law, and the practices which it authorized, the head of each department prepared his estimates, or the estimates for his department, without any reference whatever to the estimates submitted by the heads of the other departments, and without any reference whatever to the estimated revenues for the fiscal year for which the estimated expenditures were to be made. The law also required the Secretary of the Treasury, in submitting the estimates for expenditures for appropriations to also submit an estimate of the probable revenues. Under this practice the estimates for appropriations were made without any reference to the estimated revenues, and frequently these estimates for appropriations were far in excess of the estimated revenues. This threw upon the Committee on Appropriations the necessity

of reducing the estimated expenditures so as to keep the appropriations within the estimated revenues.

"Section 7 of the sundry civil appropriation act referred to, provides as follows:

"Immediately upon the receipt of the regular annual estimates of appropriations needed for the various branches of the government, it shall be the duty of the Secretary of the Treasury to estimate as nearly as may be the revenues of the government for the ensuing fiscal year, and if the estimates for appropriations, including the estimated amount necessary to meet all continuing and permanent appropriations, shall exceed the estimated revenues, the Secretary of the Treasury shall transmit the estimates to Congress as heretofore required by law and at once transmit a detailed statement of all of said estimates to the President, to the end that he may, in giving Congress information of the state of the Union and in recommending to their consideration such measures as he may judge necessary, advise Congress how in his judgment the estimated appropriations could, with least injury to the public service, be reduced so as to bring the appropriations within the estimated revenues,

if such reduction be not in his judgment practicable without undue injury to the public service, that he may recommend to Congress such loans or new taxes as may be necessary to cover the deficiency.'

"From this you will observe that if the budgets hereafter submitted exceed in the aggregate the estimated revenues, the President must either recommend to Congress what estimated expenditures can be omitted without detriment to the public service, so as to bring the appropriations within the estimated revenues, or else recommend to Congress new sources of taxation from which the deficit can be made up. The existence of the responsibility thus created has prompted President Taft to organize a committee of his cabinet to go over the estimates before the same are submitted to the Secretary of the Treasury in accordance with the law and thereby correlate all the estimated expenditures so as to bring the same within the estimated revenues. This will greatly relieve the committees of the House of Representatives which have appropriating jurisdiction so far as the estimates of the executive departments are concerned. Hitherto it has been the practice for

each department to resist any proposed reduction in their estimates in order to bring the total appropriations within the estimated

revenues.

"One of the greatest evils that to-day exist in our system of submitting estimates and making appropriations for public expenditures is the divided jurisdiction over appropriations. This jurisdiction is divided between eight committees of the House. Seven of these committees have jurisdiction over but one appropriation bill, and that is the bill carrying the appropriations for one particular executive department. The Agricultural Committee has charge of the agricultural appropriation bill; the Naval Committee, of the naval appropriation bill; the Committee on Military Affairs, of the army appropriation bill and military academy appropriation bill; the Post-office Committee, of the post-office appropriation bill; the Foreign Affairs Committee, of the diplomatic and consular appropriation bill; the Committee on Indian Affairs, of the Indian appropriation bill; and the River and Harbor Committee, of appropriations for river and harbor improvements, except those improvements which are authorized to be made under continuing contracts.

"The Committee on Appropriations has jurisdiction over appropriations for legislative, executive, and judicial expenditures, which are carried in one bill; the District of Columbia appropriation bill; the fortification appropriation bill; the pension appropriation bill; the sundry civil appropriation bill; and all deficiency appropriation bills.

"Each of those committees which has jurisdiction of but one appropriation bill naturally becomes the partisan representative of the department for which it recommends appropriations rather than the representative of the body to which its members belong and which is ultimately responsible for the appropriations which are made for that department. When, in the Forty-fourth Congress, under the leadership of Carlisle and Morrison, the jurisdiction of the Committee on Appropriations was thus divided, for the purpose of weakening the influence of Samuel J. Randall, a protectionist Democrat, Mr. Randall and Mr. Cannon, now Speaker, then members of that committee, predicted that this division of jurisdiction would cost the people of the United States not less than $50,000,000