SCIENCE OF FINANCE AND ALLIED SCIENCES 183 



Relation to Political Science 



It is sufficient for our present purpose to know that political science 

 deals with the formal and administrative activities of political or- 

 ganization. It not unfrequently assumes the form of history, but 

 its history is limited by the purpose of understanding administrative 

 forms and of criticising administrative methods. The proximate 

 motive to which judgment is submitted is the same for political 

 science as for the science of finance. Eoth acknowledge public 

 welfare rather than personal advantage as the appropriate test of 

 all conclusions. It cannot, however, be claimed on this account 

 that political science includes a consideration of financial problems 

 or the search for financial principles. The distinction between the 

 two fields of investigation is more than a matter of convenience; 

 it touches the fundamental character of the two sciences. 



There was a time when the science of finance might properly have 

 been regarded as a branch of, or chapter in, political science, but 

 this is no longer the case. With the recognition of voluntary asso- 

 ciation as a means of correlating social activities, the financier has 

 been obliged to pay closer attention to the business conditions of 

 private agencies than to the business management of public properties. 

 This is true because he is now obliged to rely rather upon taxation 

 as a source of revenue than upon the possession of public property 

 productively employed. Nor can it be said that the modern tend- 

 ency of giving to the state the exclusive proprietorship over certain 

 profit-bearing securities tends to relieve the financier from the 

 necessity of administering such industries with a view to the endur- 

 ing prosperity of private industrial enterprise. Voluntary industrial 

 association is an established institution and the administration of 

 coercive association within the domain of industry, that is to say, 

 the nationalization of public-service industries, must be guided, if not 

 absolutely controlled, by what is required for the perpetuation and 

 success of private enterprises. This means that Kameralwissen- 

 schaf t, by some regarded as the forerunner of the science of finance, 

 and which might, perhaps, have been properly claimed as a branch 

 of the political science of its day, has passed, never to return. It dis- 

 appeared with the rise of the institution of private property, and in 

 its place there has appeared the independent and self-consistent 

 science of finance. 



At what point, then, do these two fields of investigation touch, 

 and what is the nature of the influence that passes from the one to 

 the other? I shall answer this question from the point of view of 

 finance only. 



There are two important lines of influence that political science 

 exercises upon the science of finance, the one formal, the other f unda- 



