VI

AMERICAN LEGISLATION IN GENERAL

Before approaching the actual field of American legislation, it may be wise to make a few general statements concerning it. It was some fifty years after the adoption of the Federal Const.i.tution before it began in great bulk, but to-day we find in the States alone forty-six legislative bodies, and two of Territories, besides the Federal Congress and the limited legislatures of our insular possessions.

Nearly all of these turn out laws every year; even when the legislatures meet biennially, they frequently have an annual session.

Only in one or two Southern States have recent const.i.tutions restricted them to once in four years. It would be a fair estimate that they average five hundred statutes a year, which would make, roughly speaking, twenty-five thousand annual laws. It has been well doubted by students of modern democracy, by Lecky and Carlyle, if this immense ma.s.s of legislation is a benefit at all. Carlyle, indeed, is recorded to have taken Emerson down to the House of Commons and showed him that legislative body in full function, only taking him away when he was sufficiently exhausted, with the query whether Emerson, though a Unitarian, did not now believe in a personal devil. Administrative law-making for the machinery of government there must always be, but for the rest, if we rely on the common law and its natural development alone, our condition will be far less hopeless than most of us might imagine. Indeed, as we shall so often find, it is the very ease and frequency of legislation that has caused our courts and law-makers to forego the well-tried doctrines of the common law. Many of our statutes but re-enact it; when they go beyond it, it is frequently to blunder. Moreover, it is a commonplace that no law is successful that does not fairly express the thought and customs, the conditions, of the ma.s.s of the people. Professor Jenks of Oxford applies to all other legislation the term "fancy legislation," or, as we might say, freak legislation--the caprices and desires of the present legislature or their const.i.tuents, carried immediately into law; and we may say at the outset that such legislation has rarely proved wise, and hardly ever effective. It is needless to state that many modern statutes--like prohibition laws, for instance--are pa.s.sed for that very reason. Yet whatever the fact may have been in the past, there is no doubt that for the future, legislation by the people, constructive law-making at the popular behest, is the great new fact of Anglo-American civilization. There has just been brought out an immense index, under the auspices of the British Government, called "The Legislation of the Empire, being a Survey of the Legislative Enactments of the British Dominions, from 1897 to 1907." This work fills four huge volumes, and gives but the briefest possible index-headings of the statutes of the British Empire for that period.

Our excellent "Index of Legislation," published by the New York State Library, contains about six hundred pages, and even this is hardly more than an index, as the t.i.tle suggests.

Now, this tremendous increase in legislative output, most notable in the States of the United States, did not begin with us at once. For some forty or fifty years after the Revolution our State legislatures made as little constructive legislation as did the Parliament of George III. It was with the end of the first quarter of the nineteenth century that the great increase began. It seems to have taken democratic legislatures some fifty years to become conscious that they had this new unlimited power, and not only that they possessed it but were expected to exercise it; the power of making absolutely new laws, statutes which did not exist before as law, either by the common law or by the custom of the people. It is true, our ancestors had some taste of radical legislation during the Revolution, and the checks of the State const.i.tutions were adopted for that reason; but subject only to this limitation, it was the first modern experiment in popular legislation. The great wave of radical law-making that began with the moral movements--the prohibition movement, the anti-slavery movement, and the women's rights movement--of the second quarter of the nineteenth century, lasted down until the Civil War. After that there was a conservative reaction, followed by a new radical wave in reconstruction times, which ended with another conservative reaction at the time of the first election of President Cleveland. Since then, new moral or social movements, mainly those concerned with the desire to benefit labor and repress the trusts, with the desire to protect women and children, seem to have brought up a new radical wave, the progress of which has hardly ended yet. Before the Civil War, the women's rights movement and the anti-slavery movement always worked together. They were in great part composed of the same persons. In fact, the historical origin of the women's suffrage movement was a large abolition meeting held in England, but attended by many women delegates from America, where they excluded a leading American woman abolitionist and would only allow her husband to take her seat in her place. We shall, of course, consider this precise question later, and pause now merely to note the fact that with the anti-slavery movement, ending with the adoption of the war amendments and the women's suffrage movement, ceasing to progress soon after, there came the period of conservative reaction, or, at least, of quiescence, which lasted down to the recent labor and social movements that have caused our increasing ma.s.s of constructive legislation in the last few years.

It is true that some of the far Western Territories adopted women's suffrage soon after being made States, or at the time they were admitted; but no other State, even of those surrounding them, has followed their example, though the people have repeatedly voted on the point. Whatever progress the cause may have made in England, or in the larger cities of the East, I think that no unprejudiced observer would say that it looks so near to accomplishment as it did in the twenty years preceding the Civil War. Then, also, there was during the same decades a great increase in personal property; that is to say, in corporate stocks and bonds, the kind of property most easily attacked by legislation; but the very possession of such securities by large numbers of the people tended to make them more conservative in ordinary property matters. It is in the times when you have but farmers on the one side, as in the Shay Rebellion in Ma.s.sachusetts after the Revolution, or when the proletariat on the one side is opposed to the bourgeoisie on the other, as in certain Continental countries, that you find radical legislation. We were fortunate in that a large number of our citizens were thus arrayed on both sides of the question. Property rights, of course, have been granted to women most completely throughout the Union, but in twenty years they have made little progress toward the vote.

Blackstone says that democracy is peculiarly fitted to the making of laws, and calls attention to the importance of legislation, with the regret that there should be no other state of life, arts, or science, in which no preliminary instruction is looked upon as requisite; but by "democracy" Blackstone really meant representative government, which still acts quite differently from the referendum and the initiative. Democracies, he says, are usually the best calculated to direct the end of a law. But in no sense, says Professor Jenks, was the British Parliament the result of a democracy; while our State legislatures during the Revolution were, indeed, democratic, and practically omnipotent, and for that very reason were promptly curbed by the State const.i.tutions, which were adopted even before the Federal. And of late the distrust of our legislatures is shown by the most exaggerated list of restrictions we find placed upon them in the newer const.i.tutions of the Southern and Western States. Another thing Blackstone oddly says, is that in legislation by the people they will show great caution in making new laws that may interfere with their rights and liberties. Precisely the contrary is experienced. n.o.body is so willing to interfere with the rights or liberties of the people as the people themselves, or their supposed representatives in the legislature; and a body or faction of the people is far more ready and reckless to impose its will upon the others than have been the most masterful English monarchs.

The recklessness of legislatures has two or three most evil consequences. They pa.s.s foolish or unconst.i.tutional laws, relying on the governor to veto them, or the courts to declare them void--which has the effect of shirking their responsibility and imposing unjust and obnoxious duties on the other branches of government, to which they do not fairly belong; increases the growing disrespect for all law, and deteriorates the moral and intellectual fibre of the legislature itself. Finally, also, it provokes that hypertrophic modern State const.i.tution of the South and West, which tries to bind down future legislatures in infinite particulars, thereby again diminishing their importance and responsibility, making it more difficult to get able men to serve in them, and, by the frequent necessary amendment of State const.i.tutions, resulting in a continual referendum, which nearly does away with representative government itself.

Moreover, when a law is unconst.i.tutional it should ever be only because it violates some great natural right of humanity, personal liberty, property, or the right to common law. When const.i.tutions go into details which are not substantially connected with these cardinal rights, they bring themselves into contempt, and justify the growing prejudice of our labor leaders against them. The people should believe, as I think they do believe under the Federal Const.i.tution and under the older ones of the States, that when a law is declared _no_ law by a high court for being counter to the higher will of the people as expressed in their permanent const.i.tution, it is not on a technicality, but because some great liberty right is infringed by it.

Yet it is a curious thing that whereas our people only got the power to legislate by democratic a.s.semblies freely and completely from the year 1776, in hardly more than a hundred years after their conscious possession of that power we find a respectably strong popular movement attempting to reverse it, or, at least, to limit its field. Most of our advocates of direct legislation by the people a.s.sume that a great ma.s.s of law-making would result in practice; probably the contrary is true; the referendum would destroy more than the initiative would create. They would go back to a condition of things which, in theory at least, existed in the England of the early Saxon times; although, of course, in those days only the freemen, and no women, had the law-making vote. Anyhow, it is curious that that representative government upon which we have been priding ourselves as the one great Anglo-Saxon political invention should be precisely the thing that we are now urged to give up. In the _Federalist_ there is much discussion as to whether it is possible to have so big a democracy as the United States, and the answer made by Hamilton was; "Yes, because we shall have representative government." But detailed discussion of the initiative we must leave for a later chapter.

Perhaps we begin to detect the prejudice in the general mind, which is notable in the works of a few earlier theorists, to prefer statute law to what is known as judge-made law, on that ground alone. The writer is not of the school that admits there is such a thing as judge-made law, but believes the phrase to be a misnomer, at least in ninety-nine cases out of a hundred. The whole theory of the English law is that it exists in and by the people and is known of them before it is announced by a judge, and although the extreme of this theory be somewhat metaphysical, it is certainly true that a judge is a very bad judge who does not decide a point of law apparently new or doubtful according to the entire body of English-American precedent, experience, rather than by his own way of looking at things. If judges really made new law, particularly if they made it consciously, it would be more than "aristocratic"--it would be simply tyrannical, and, of course, be unconst.i.tutional as well as being an interference with the legislative branch of government. But it is doubtless this theory, that it is the statute law that is the democratic kind, which has given form and body to the vast ma.s.s of statutes we are here to consider. Certain of our legislators seem to be horrified when a court applies a precedent a hundred years old, still more when it is a thousand years old, although to the jurist, in most cases at least, if never since questioned and never grown obsolete, it is ent.i.tled to all the more respect for that reason. Both the labor interests and the "special interests" resent excessively the recent tendency of intelligent judges to look at precedent and history. Mr. Debs will tell you that such matters are aristocratic and reactionary; Mr.

Rockefeller, or his lawyer, that they are both visionary and obsolete.

Yet a statute may only represent the sudden will of a small body of mediocre intelligence on a new subject (or an old one) which they have never studied. It is true that if they make a mistake they can amend it to-morrow; but so, also, may be amended the decisions of the court.

VII

AMERICAN LEGISLATION ON PROPERTY RIGHTS

When we come to the vast field of legislation in the United States, comprising the law-making of forty-six States, two Territories, the National Congress, and the Federal District, it is difficult to decide how to divide the subject so as to make it manageable. The division made by State codes and revisions, and the United States Revised Statutes, hardly suits our purpose, for it is made rather for lawyers than sociologists or students in comparative legislation. The division made by the valuable "Year Book of Legislation," published by the New York State Library, comprises some twenty subjects: Const.i.tutional Law; Organic Law; Citizenship and Civil Rights; Elections; Criminal Law; Civil Law; Property and Contracts; Torts; Family; Corporations; Combinations and Monopolies; Procedure; Finance; Public Order; Health and Safety; Land and Waters; Transportation; Commerce and Industry; Banking; Insurance; Navigation and Waterways; Agriculture; Game and Fish; Mines and Mining; Labor; Charities; Education; Military Matters; and Local Government. This division, however convenient in practice, crosscuts the various fields of legislation as divided in any logical manner. The same criticism may be applied to a somewhat simpler division I have used in tabulating State legislation for the last twenty years into thirteen columns, the t.i.tles of these being, roughly speaking, Property and Taxation; Regulation of Trades and Commercial Law; Personal Liberty and Civil Rights; Labor; Criminal Law, Health and Morality; Government; Elections and Voting; Courts and Procedure; Militia and Military Law; Women, Children, Marriage and Divorce; Charities, Education, Religion and Jails; Agriculture, Mining and Forestry; Corporations, Trusts and Interstate Commerce. Is it not possible to begin with a broader and more simple division?

Now, all statutes are limitations on a state of pure individualism, defining this latter word to mean a state of society recognizing personal liberty and private property, and allowing all possible freedom of action and contract relating thereto; with a court administration for the purpose of protecting such liberty and enforcing such contracts in the courts. The usual rough division of our const.i.tutional rights, following the phraseology of the Fourteenth Amendment, is that of life, liberty, and property; but the rights to life and liberty obviously belong to the same broad field. Our first division, therefore, may well be that which divides life and liberty rights from property rights; although in some cases, notably in the earnings of labor, they would be found to run together. Liberty rights are multifarious and indefinite; we may, therefore, first take the field of property as presenting, after all, a more simple subject.

Considering all possible organizations of human society from this point of view, we shall find that all may be expressed, all at least that have hitherto been conceived, under the systems of anarchism, individualism, and socialism, these words expressing all possible states of human society when expressed in terms of individual liberty, that is to say, the free exercise of the individual will. Either one of these may exist either with or without the notion of private property; though, of course, one's action as to property would be controlled under a system of socialism, and property itself would have no legal protection under a system of anarchism. Nevertheless, the notion of property might still exist and be recognized by the custom of mankind without any sanction or enforcement from the entire community, _i.e._, what people call the state. When we are speaking in terms of property, we use the word _communism_--meaning that state of society where the conception of property exists, but the law or custom will not recognize individualism. Communism, therefore, usually implies ownership by the entire community, while in anarchism there is no property at all. There has been much confusion in the use of these terms in the popular mind, and even in ordinary writing. Many people have confounded, for instance, socialism with anarchism or nihilism, when the two things are whole poles apart. In the same manner, communism has been confounded with socialism, although the term should be used in entirely different connections--communism when we are speaking in terms of property, socialism when we are speaking in terms of individual liberty. The word _individualism_ was used by the present writer in a series of articles ent.i.tled "The Ethics of Democracy," beginning in 1887, as the most convenient term for describing that state of society where the greatest possible individual liberty is conjoined with a strong recognition of the right of private property, substantially the _laissez faire_ school as it existed in England in the first half of the last century; "the distinction between communistic and socialistic laws being, that the former are concerned solely with the taking or redistribution of money or property; the latter regulate or prohibit men's mode of life, acts, or contracts, either among themselves or as concerning the state." [1]

[Footnote 1: _Scribner's Magazine_, vol. XV, p. 653.]

Now, property is but the creature of law; and that is to say, in those of our States which have no common law, of statute. Jurists and communists are alike agreed on this. "Property is robbery," said Proudhon; property is but the creature of law, all English jurists admit. It is, of course, possible to conceive of a social system which recognizes no right of property, or one which makes all property belong to the community, or a middle ground which admits the inst.i.tution, but holds that every individual holds property subject to the state's, that is, the organized community's, regulation and control. A convenient term for this state of affairs to which, perhaps, in our statutes, we are approaching, is "allowable _socialism_"; private property is recognized, but its use is regulated. In England they call it "gas-and-water socialism"; but this term, though picturesque, is not sufficiently comprehensive, relating, as it does, only to munic.i.p.al activities. There is a third variety, the latest and perhaps the most intelligent of all, that believed in by leading modern German and American socialists, which we will call nationalism--the nationalization or munic.i.p.alization of productive industry--the science of this doctrine being that private property may exist in all personal belongings, articles of pleasure, or domestic necessity, but not in lands, mines, works, or other instrumentalities used for the further production of wealth.

Whatever the future may bring, we must start with the inst.i.tution of private property recognized to its fullest extent. It is expressly guaranteed in our Federal Const.i.tution, as for the matter of that it was also in Magna Charta, as clearly as the right to liberty, and usually in the very same clause. Not only that, but when we adopted our first State const.i.tutions, from 1776 to 1788, and the Federal Const.i.tution in 1789, every one of them made express guarantee of this right. One or two, following the lead of Ma.s.sachusetts and Virginia, recognized equality also, or, at least, equality by birth and before the law; but without exception property was expressly recognized as one of two leading const.i.tutional rights, and even in some States, like Virginia, it was termed a natural right. The same thing is true of the Ma.s.sachusetts Bill of Rights and in the Federal Fifth Amendment, though it is significant that the Declaration of Independence omits the word _property_, and only mentions among unalienable rights, life, liberty, and the pursuit of happiness--which some courts have held to include private property.[1] Nevertheless, under our const.i.tutions to-day, the right is not only doubly, but even triply, guaranteed; that is to say, by all State const.i.tutions against State action; by the Federal Const.i.tution against national action; and finally, by the Federal government in the Fourteenth Amendment as against State action also. This is the reason why, in any case affecting a cardinal liberty or property right, a litigant may carry his case not only through the State courts, which have sole jurisdiction of ordinary business and domestic matters, but to the courts of the United States as well.

[Footnote 1: Justice Brewer, in the _Yale Law Review_, for June, 1891.

He holds that under "the pursuit of happiness" comes the acquisition, possession, and enjoyment of property, and that they are matters which even government cannot forbid nor destroy. That, except in punishment for crime, no man's property can be taken without just compensation, and he closes: "Instead of saying that all private property is held at the mercy of the public, it is a higher truth that all rights of the state in the property of the individual are at the expense of the people."]

When we come to legislation on the subject, or to modern State const.i.tutions, there is hardly a change in this particular. Naturally, we find no new legislation confirming the right of property abstractly, or restating that that inst.i.tution is part of our civilization. There is but one significant exception to this statement. While most of the States in their const.i.tutions declare that men have a natural right to acquire, possess, and protect property, and Kentucky and Arkansas go to the length of saying that the right of property is "before and higher than any const.i.tutional sanction"--which latter statement is a legal hyperbole--Oklahoma in its recent const.i.tution, North Carolina, and Missouri state only that men have a natural right to the enjoyment of the fruits of their own labor; on the other hand there are recent intimations coming from Federal sources that individualism or private property rights, at least, and not anarchism or socialism, are part of our const.i.tutional system. Before 1907 a Texas district judge refused to naturalize an immigrant on the ground that he was a socialist and that socialism was inconsistent with the Federal Const.i.tution; and in that year Congress pa.s.sed an act to regulate all immigration of aliens, which excludes, among other cla.s.ses, persons who believe in or advocate the overthrow by force or violence of the government of the United States or of all government, or of all forms of law--a definition which would exclude anarchists, but not socialists; and in the case of South Carolina _v_.

United States (199 U.S. 437), the Supreme Court of the United States gave serious consideration to the question whether State socialism was compatible with a republican form of government. This is all, so far as I am aware, that a century and a half of legislation has given us affirming the abstract right of property, though there are several constructive statutes and const.i.tutional provisions applied to the general right to trade or labor, which we shall consider when we come to that subject.

When a right is expressly guaranteed by the Const.i.tution, we need ordinarily have no affirmative legislation about it. Liberty and property being always guaranteed by the State const.i.tutions, it has not been necessary for the States to legislate to protect them.

Our study of this subject, therefore, will be confined to the restrictive or limiting legislation affecting private property or property rights, and of this we shall find plenty. Now there are four, and only four, methods by which the state, that is to say, American society as organized into governments, interferes with the right to property or the enjoyment and use thereof; that is to say, taxation, which is, of course, general; eminent domain, a peculiarly American doctrine; the police power; and the regulation of rates and charges.

Some authorities place the last under the police power; but It does not seem to me that it historically, if logically, belongs there.

Starting with the simplest first--eminent domain, an American doctrine which, in its simplest form, subjects the land of any one to the need of the state or, in cases authorized by the Federal Const.i.tution, of the nation. It is questionable whether it applies to personal property. It is an American doctrine, for in England where the king remained in theory the feudal over-lord, it was not necessary for him or the sovereign Parliament, wishing to take or control land, and having no const.i.tution protecting property rights against such action, to invent any new doctrine; but with us all land is allodial. The old charters of the original States creating tenures in free and common socage are, of course, obsolete. Everybody is a freeholder, and the States are not, still less the Federal government, a feudal over-lord.

Nevertheless, the property of every one must be subject to the supreme common necessity; and the right is absolute in the States, although limited in the national government by the Federal Const.i.tution. It is an American const.i.tutional principle; and this principle also provides, as does Magna Charta and the early charters of England as to _personal_ property seized by royal purveyors, that full damages must be paid; and to this general principle our const.i.tutions have added that the damages must be paid at the time of the taking and the amount be determined by due process of law; that is to say, in most cases by a jury. Blackstone says: "So great is the regard of the law for private property that it will not authorize the least violation of it; no, not even for the general good of the whole community";[1] a new road, for instance, cannot be made without consent of the owner of the land, and the words "eminent domain" do not appear in the text of his book. But though we hold the contrary doctrine, the rights of the property owner are sufficiently protected when the taking is directed by the State, or even by a city or town. The menace to property here, with the increasing bulk of legislation, comes in the number of _new_ uses, not only directly for the State or for cities and towns, but for public-service corporations, or often other private corporations, and a.s.sociations of persons, who are permitted by legislation to take land under eminent domain, or, what is often worse, to acquire eas.e.m.e.nts over it. Most of the States give damages for land not actually taken, but damaged, though our Federal courts have not held this to be necessary under the Fourteenth Amendment; but although land can still, in theory, only be taken for a public use, the number of uses which our legislation makes public Is being enormously increased. The usual national purposes are forts, magazines, a.r.s.enals, dockyards, and other needful buildings. Independent of some express permission in the Const.i.tution, the Federal government has no power to take, or even to own, land at all within the State limits. Therefore, it is questioned whether land may be taken for national parks or forest reservations except in the Territories, where t.i.tle still remains with the Federal government. But the State's power of eminent domain is unlimited, although it began only with the towns or counties taking roads for highways, and cities and towns appropriating lands for schools and other public buildings. Probably the only serious addition of a wholly public use is covered by the general expression, parks and playgrounds; but the a.n.a.logy of the highway led to the taking of land under eminent domain for railroads, when they were first invented, then for street railways, then for telegraph, telephone, and electric-light lines, underground pipe-lines or conduits of all sorts, and finally, for drains, sewerage districts, public, and often private irrigation purposes. Most of the more complex State const.i.tutions define at great length to the extent of some twenty or thirty paragraphs just what purposes shall be considered a public use under eminent domain. In the absence of such definition, or without such definition, the number of such uses is being enormously increased by statute. Thus, reservoirs, storage basins, irrigation ca.n.a.ls, ditches, flumes, and pipes for water drainage, or mining purposes, working mines, as dumps, hoists, shafts, tunnels, are made a public use by the const.i.tutions of the arid States, Idaho and Wyoming. So as to water only in Montana, but in Idaho also to any other use "necessary for the complete development of the material resources of the State or the preservation of the health of its inhabitants."[2] And even by private parties, land may be taken for ways of necessity in many States, and for drains, flumes, and aqueducts by the const.i.tutions of the arid States.

[Footnote 1: Book I, p. 139.]

[Footnote 2: These provisions are collated in "Federal and State Const.i.tutions," p. 159.]

At common law, of course, a man or a set of men, who happen to be neighbors, would have had no right to take my land for a private way, or for drainage or irrigation purposes, however beneficial to their land; still less to take water from my stream across my land to their fields. But this precise thing can be done in an increasing number of States, although it has been held unconst.i.tutional in the courts of one or two of the far Western States, and has even yet not been decided by the Supreme Court of the United States as to the powers of the Federal government. Under the broad definition given in Idaho and Wyoming, you can probably take land to establish a munic.i.p.al coal-yard, or dispensary, or anything else that the legislature might suppose to be for the general health or benefit of the people. Yet a hotel company would not, as yet, be considered a public use, nor, probably, a private recreation park. And land taken for one use may be subjected to other and totally distinct uses without giving any new right of damages, as was decided in Ma.s.sachusetts, at least, when land given or taken for an ordinary city street was afterward occupied by a steam railroad. A notable limitation on the use of streets, however, we find imposed by the statutes of New York and many other States, which provide that no railway shall be placed therein without the consent of a majority of the property owners or ab.u.t.ters. There is frequent legislation providing that the betterment taxes collected in case of public improvement shall not exceed the damages given for the property actually taken. In the last two or three years there has been an extension of the doctrine, authorizing cities and towns to take more land than is actually needed, for the purpose of convenience, or in order to get a better bargain, and then sell the surplus; but such laws may be unconst.i.tutional.

Land may, of course, be taken for all munic.i.p.al purposes, including public squares or parks, playgrounds, reformatories and penal inst.i.tutions, levees, ditches, drains, and for cemeteries; and the right is being granted to private companies other than those above mentioned, in Colorado, to tunnel, transportation, electric power, and aerial tramway companies; in North Carolina to flume companies; in many States for private irrigation districts; in the West generally to mining or quarrying companies; in West Virginia and other States to electric power, light, or gas companies; while in North Carolina, Washington, and Wisconsin, we find the dangerous grant of this great power to electric-power companies, which are, in Wisconsin at least, expressly permitted to flood lands by right of eminent domain in order to form ponds for power purposes. It is easy to see that under such legislation everybody holds his land not only subject to public need, but to the greed of any designing neighbor. Perhaps the most important question of eminent domain is or was whether it authorized general schemes of internal improvement made by the State or by a munic.i.p.ality, or, worse still, by a private corporation chartered for the purpose. The Const.i.tution of Michigan, with those of the Dakotas and Wyoming, provides that the State cannot be interested in works of internal improvement, nor, in North Dakota and Wyoming, engage in them except on two-thirds vote of the people; nor, in Alabama, may it loan its credit in support of such works; nor, also, in Maryland, Minnesota, Ohio, and Wisconsin, create or contract debts for them; nor, in Kansas and Michigan again, be a party to carrying on such works. But the Tennessee Const.i.tution declares that a well-regulated system of internal improvement should be encouraged by the legislature. So, in Virginia, no town or county may become a party to any work of internal improvement except roads, and they are frequently forbidden from borrowing money for such purposes. There is, therefore, considerable const.i.tutional check to legislation in this direction.[1]

[Footnote 1: See "Federal and State Const.i.tutions," book III, secs.

92, 324, 345 370, 391, and 395.]

Taxation, of course, has from all time been the universal limitation upon property rights, though it is important to remember that until the present budget there has not in modern times been an attempt at direct taxation of the capital value of land in England; Cobbett records many "aids" of a few shillings per hide of land in Anglo-Norman times. The earliest taxation was the feudal aids imposed purely for defensive purposes, for building forts and bridges; later for foreign wars or crusades. We have traced the origin of the scutage tax as a subst.i.tute for military service and the two great const.i.tutional principles that all taxation must be with the common consent of the realm; that is to say, of Parliament, later of the House of Commons; and must also and equally be for the common benefit.

Theorists have argued, particularly with us, that under the latter principle protective tariffs are unconst.i.tutional; but even if it be admitted that they are not for the benefit of the whole people, the exception is as old as the rule; protective tariff laws, and, earlier still, laws absolutely prohibitive of importation, being plentiful on the English statute-books before and at the time this earliest of const.i.tutional principles appeared. There is a step beyond the protective tariffs, however, which is naturally mentioned in this connection, and that is the bounty--sums of money paid to certain interests and derived from the general taxes fund. Under the Acts of Congress there has been, I think, only one instance of a bounty; that is in the case of the Louisiana sugar-growers. In State legislation it has been a little more usual. Foreign countries, notably Germany and France, as to beet sugar, etc., have been in the habit of giving bounties. This precedent undoubtedly suggested it; but these countries do not enjoy our const.i.tutional principles. There has hardly been a direct decision on the const.i.tutionality of the Federal bounty, but as to State bounties we find several, with an increasing tendency to hold void such laws. There can be no question that they are utterly against our whole const.i.tutional system. The Supreme Court, when considering sugar-bounty laws, seems to have thought that it might be sustained as a compensation made for a moral obligation, the Louisiana planters having been led into industries from which the protection was suddenly removed; of such nature must be the justification, if any, for bounties given in times of flood, fire, or public disaster, which, however, are really sustained only in the absence of objection and on the principle _lex non curat de minimis._ The most insidious form of the bounty, however, is that of exemption from taxation, or, still worse, granting subsidies or subscribing to the stock and bonds of public-service, or even ordinary private, corporations. Undoubtedly the exception has been established in the case of railroads. The granting of State, city, or county aid to railroads has existed almost from their invention, probably on the a.n.a.logy of highways; at all events, it is too late to be const.i.tutionally questioned now. The exemption from taxation of private profitable enterprises, such as mills or factories, is less defensible. Frequently, however, they go without question, it being to no one's particular interest to do so.

The usual subjects of State bounties were, in 1890, beet-root sugar, binding twine, iron and iron pipe, potato starch, and rope, with tax exemptions to Portland-cement works. Ramie fibre continued a favorite subject of bounty for some years, with seed distributions to farmers, which were in some States held unconst.i.tutional. In 1896 Utah gave a bounty on canaigre leather and silk culture. There was an exemption on salt plants in Michigan, but beet sugar continued the favorite beneficiary. There has been a reaction against bounty legislation of recent years. In 1908, for instance, New York repealed its bounty on beet sugar, and it may be hoped, with greater intelligence of const.i.tutional principles, that all such legislation will be abandoned.

Coming to matters of ordinary taxation, of course the first thing to note is its extraordinary extent. In direct taxation it is not an unfair estimate to say that the States and their munic.i.p.al organizations undertake to impose an annual a.s.sessment on real and personal property which would average at least two per cent.

throughout the country; amounting to from one-third to one-half of the income derived therefrom. In indirect taxation, duties, and revenue taxes, a sum far greater is taken from the average household. One might very much wish that the individual householder might at least know how large a sum is thus taken from his earnings annually, for it is safe to say that in no civilized country, not even in the France before the Revolution, was individual taxation anything like so heavy.

Therefore, we are beginning to find legislation, even const.i.tutional provisions, carefully limiting the tax rate. The amount of the State tax is thus limited in probably half the States, mostly Southern or Western, and nearly all of them limit also the amount of taxation to be imposed by the counties, cities, towns, school districts, or for other special purposes. In the North-eastern States such limitation is not usual, though in Ma.s.sachusetts and New York it exists as to certain cities. It may properly be said of such legislation that it does not appear to be so futile as one might have expected. There is, of course, a tendency to raise the limit, involving frequent const.i.tutional amendment, or, in Ma.s.sachusetts, for instance, where the limitation is put on only by statutes, by later statutes authorizing the borrowing outside of the debt limit; for it should be said that such limitations do usually apply both to the appropriations and to the funded indebtedness incurred. Still I have not observed in the last twenty years any repeal of such laws or const.i.tutional provisions, but rather an increasing number of States adopting them, from which it may be inferred that they work satisfactorily. Nearly all the States purport to tax the capital value of both real and personal property, not, as in England, rents or incomes; and they tax "tangibles" and also "intangibles." That is to say, they undertake to tax stocks or bonds or mortgage debts; the evidence of property, as well as the property itself; and the debt as well as the property securing It. Some States, such as Pennsylvania, impose a smaller, more nominal, tax upon stocks and bonds in the hands of the owner, for the sake of getting a larger return, but in many States, such as Ma.s.sachusetts, this legislation would be unconst.i.tutional, as not proportional taxation.

There is a ma.s.s of legislation every year directed to the a.s.sessing and collecting of taxes, tending more and more to become inquisitorial, requiring the tax payer under oath to furnish full schedules of his property, with provision for an arbitrary a.s.sessment if he fails to do so. One effect of this has been to drive very wealthy men from Ohio or other Western States to a legal residence in the East, where the laws are more lenient, or their enforcement more lax. The problem is a most important one and I see no signs yet of any solution in the increasing ma.s.s of legislation one finds upon this subject every year. It is to be noted--what our socialist friends have never seemed to observe--that just in so far as a man's earnings or income are taken from him in the form of taxation, you are already in a state of socialism. That is to say, to that extent is his income taken from him and administered by the state. This is an observation most unwelcome to the opponents of capitalism, so-called, who resent the conclusion that if the State and Federal governments are already taking forty per cent. of his income from him, a state of perfect socialism could do no more than take the other sixty per cent. This whole problem of taxation, indeed, is evaded at present only by the miserable solution of fraud; hardly any one, except the non-propertied cla.s.ses, paying what the law purports to take from them; and the non-propertied cla.s.ses only pay it because their taxation, being indirect, is paid for them by others.

Coming to other forms of taxation, we may distinguish three: Income, succession, and license. Income taxation in England dates, it is said, from 1435; but (in the shape of t.i.thes) it is far older. The power of income taxation (except upon earnings and profits) belongs here only to the States; just as the sole power of imposing duties on imports is given to the Federal government. Many of the States impose an income tax, but I observe no particular increase in that kind of taxation in the legislation of the last twenty years. A man's income is commonly taxed with his other property. It is a form of tax far more evaded here than in England, probably because the English law provides a machinery for collecting a large part of income taxation from the persons from whom the income is derived, as, for instance, from the tenant who pays rent to a landlord; just as with us a corporation is made to pay the tax on its capital stock nominally due from the individual owner. The only notable extension of income tax legislation is in the establishment of the principle of the _graded_ income tax, which is beginning to be adopted in a few States, as in North and South Carolina in 1897.

This principle of graduated taxation has, however, been nearly universal in our next and more modern variety--the succession tax. The old English precedents are the "aids" and fines for alienation. But beginning here about 1893, this form of taxation has now been adopted by nearly all the States, the amount of the tax being graded both according to the relation of the inheritors to the person from whom the succession is derived, and according to the amount of the inheritance itself; the rate of the tax thus varying all the way from an absolute exemption, as to the wife or children, to a tax as high as twenty-five per cent. (in New York) in the case of large estates going to remote relatives. The Federal inheritance tax imposed at the time of the Spanish war was soon repealed, and this domain of taxation, with the income tax, is now almost universally employed by the States.

The principle itself can hardly be carried much farther, but it will be necessary to have some understanding or arrangement between the States, whereby double or treble succession taxes are not imposed on the same estate, as notably in the case of the stock or bonds of railroads chartered in several States, all of which may undertake to impose full succession taxes upon such stock. It has been held that succession taxes may be graded even in cases where a State const.i.tution provides for proportionate taxation, the tax being an excise tax and not a direct property tax; but this is not so in respect to income taxes. We may a.s.sume therefore that income taxes must be equal in States which have this const.i.tutional provision, although in one or two of them recent statutes have exempted a portion of the income of veterans of the Civil War. This might be sustained as a pension, pensions being for actual military service const.i.tutional, and are in the Southern States expressly permitted to Confederate soldiers and their families--despite the implied prohibition of the Fourteenth Amendment.

The last form of taxation, that of an excise upon licenses or trades, is most usual in the South. An increasing number of trades are thus being taxed or regulated. Sometimes the taxation is put under the guise of a fee for examination and licensing, sometimes plainly as an excise tax. Undoubtedly such taxation is against all the history of our legislation demanding complete freedom of labor and trade.

Nevertheless, it has not been held unconst.i.tutional by the States except, of course, when touching a trade which is interstate commerce, though the _examination_ occasionally has been. Such taxation has not yet become popular in the North, except definitely for the purpose of examination and license; but it is almost universal in the South, many States indeed providing by their const.i.tution or laws that all trades and callings may be thus taxed. These taxes may be arbitrary in amount, but are sometimes graded according to the amount of business done. Such legislation has been sustained in so far as it is a tax or a license imposed for protecting the public health in a reasonable manner; thus, doctors, plumbers, nurses, dentists, etc., have been submitted to such regulation, but in the case of blacksmiths its const.i.tutionality was in one State denied, and the law as to barbers in several States annulled. Nevertheless, it will always be a popular method of raising money in the poorer States, where land already bears its full burden and little personal property can be found.

Commissions of inquiry on this whole subject of taxation are continually being appointed--we have had two in Ma.s.sachusetts in the past ten years--and their recommendations nearly always prove unacceptable. The probable scientific answer, that you must only tax property and not money or the evidence of property, and that if direct taxation thereby becomes too burdensome we must reduce our rate of expenditure, is a conclusion our legislators are yet unwilling to accept. The taxation of corporations presents a different problem and we shall therefore leave it for special consideration with that subject. The matter of betterment taxes may be dismissed with a word, as it is hardly, in theory, taxation at all, but rather using munic.i.p.al agencies to collect the cost, or part of the cost, of a local work or benefit. It is, of course, closely connected with the subject of eminent domain. That is to say, only a public use, or at least a general local benefit, can justify a betterment tax. There is still considerable legislation on this matter, confined generally to the objects of securing a jury trial, or at least a public hearing, on the amount of the a.s.sessment, defining the purposes for which it may be imposed, as, for instance, paving, sewers, water-works where public, and--perhaps the most contested case of all--that of parks or pleasure-grounds; and providing that the amount of betterment taxes imposed shall not exceed one-half the value of the improvement of the property, and shall never exceed the amount paid as damages when part of the owner's land is taken.

By far the greatest ma.s.s of legislation relating to property is concerned with the police power and modern extensions thereof. It is also by far the most dangerous to property rights, and this for several reasons: firstly, it involves the destruction of property without any compensation whatever, not upon payment of damages, as in the ease of eminent domain; secondly, on account of the extraordinary extension by our modern legislation of this power to matters not hitherto deemed necessary for the safety, health, or even the well-being of the public, vague as the legal application of the last word is; thirdly, and perhaps most important, because the police power is usually exercised without any common-law guarantees, without process of law or jury trial, but by the arbitrary ruling of some board, or even single commissioner, and often, so far as the statute is concerned, without a jury or even an appeal from the commissioner's ruling to any court of law.

I believe this to be the most dangerous tendency that now confronts the American people--government by commission, tenfold more dangerous than "government by injunction." Not only is there no liberty, no appeal to common right and the courts, but all permanent "boards" tend to become narrow and pedantic or, worse, to be controlled by the works they are created to control.[1] The const.i.tutionality of such boards is, of course, always questionable, but the tendency to create them is perhaps the most striking thing in modern American legislation. Not only do we find them in enormously increased numbers in all the States, but even a late President of the United States seriously recommended that the contracts and affairs of all corporations at least (and the bulk of modern business is done in corporate form) should be so submitted to the control or dictation, or even the nullification, of such an administrative board or commission, and this again with no appeal to the courts. So audacious an upsetting of all Anglo-Saxon ideas of the right to law, it may be said without exaggeration, has never been attempted in the history of the English people, not even by the Stuart kings, who were most of all disposed to interfere in such particulars. Wiser counsels deterred the administration from insisting on this measure, but the fact that it could be brought up, and that with the approval of a large portion of the public, indicates how radical our legislation is getting to be in this particular.

[Footnote 1: Two singular instances happened only the past year: at common law any one may build railroads, and they are certainly for the general advantage whether profitable to the owners or not. Yet the railroad commissions of New York and Ma.s.sachusetts have recently in each State prevented the building of most important lines, by responsible applicants--under the opposition of other railroads.]

It is a commonplace in the law that no court has defined, or ever will consent to define, the exact limits of this police power; suffice it to say that in the cla.s.sic words of Chief Justice Shaw of Ma.s.sachusetts, "it is all that makes for the health, safety, or comfort of the people." As to the health and safety, there can be little question; but when it comes to indefinite words like "comfort"

or "well-being," too wide a field is left for the imagination. It has recently been decided that the aesthetic part of life does not necessarily concern the comfort or well-being of the people. That is to say, laws forbidding the use of land for the erection of hideous signs, or forbidding the height of buildings at an inartistic excess have been declared not to fall within the police power, but under eminent domain. So of statutes forbidding the taking of a man's picture, or a woman's portrait for advertising purposes, when not properly obtained; yet it may be questioned if any law is more certainly for the comfort of the persons concerned than such a statute. On the other hand, noisy or noxious trades, mosquito ponds, trees infected with moths, etc., sawdust in water, offensive smoke, and, in Vermont, signs, were all made nuisances by statute of one State or other in 1905 alone. The first historical instance, perhaps, of destruction of property under the police power was the blowing up of buildings to check a conflagration, a practice still common, although its utility was much questioned after the Boston fire, and which, at common law at least, gave the owner no right to compensation; but the more usual use of the police power until very recent years has been limited to the prohibition of offensive trades in certain localities, and the suppression of public nuisances. Later, the prohibition of the manufacture of intoxicating or malt liquors, and the regulation of tenement houses at the orders of the Board of Health. This led to the regulation or prohibition of certain trades conducted in tenement houses or in sweat shops, and to other matters which we shall find it more convenient to consider under the head of labor legislation.

Whether there are any limits to this power is much discussed. There is no question that the power must not be arbitrary or utterly without reason, and of that reason the courts must and do in fact judge.

Taking property for a purpose unjustified by the police power is, of course, taking property without due process of law. An arbitrary statute taking the property of _A_ and giving it to _B_, or even to the public, without compensation has, from the time of Lord c.o.ke himself, been the cla.s.sic definition of an unjustifiable law and one which with us at least is unconst.i.tutional; but our courts wisely refuse to judge if, when a proper police motive is disclosed in the statute, it is the _best_ method of effecting the result. This, I think, is a clear statement of the principle of our court decisions.