THE BEST METHODS OF TAXATION. 739 



a profit, this labor must be bestowed in cultivating some product as 

 find a market in international trade. Hence arose the importance 

 of the sugar, coffee, tobacco, and spice crops of these Dutch islands, 

 and for many years a handsome profit to the treasury was obtained 

 from the management and sales of product. With the great fall in 

 prices of sugar and coffee throughout the world, and the narrowing 

 of the market for cane sugar, the Government obtained a less income 

 each year, and has found it of advantage to relax the conditions sur- 

 rounding cultivation, and to throw the management of the planta- 

 tions more and more into private hands. To such an extent has this 

 transition been effected that the state can no longer be considered as 

 controlling a monopoly in product or sales, and is content with a rev- 

 enue from other sources, one that does not even cover the expenses in- 

 curred in the colonial system. This experiment differs widely from 

 those industries undertaken with the aid or encouragement of the 

 state to be found in India. It was not with a fiscal object that they 

 were established, and not infrequently the state sacrifices revenue by 

 releasing them from tax burdens they would ordinarily endure. As 

 one of the few remaining instances of the direct participation of a 

 state in the production of products intended for foreign markets, yet 

 undertaken and maintained for fiscal reasons, the history of the Dutch 

 colonies in the East is instructive. 



In Prussia the working of certain mines is in the hands of the 

 state, and was originally looked upon as an important contribution to 

 the income of the state. As in the Dutch experience, the changes in 

 production throughout the world have greatly reduced the returns 

 and made the income variable; yet there is little disposition to dispose 

 of these possessions. " The danger of mineral supplies being worked in 

 a reckless and extravagant manner without regard to the welfare of 

 future generations, and the dread of combinations by the producers of 

 such commodities as tin, copper, and salt, with the aim of raising 

 prices, have both tended to hinder the alienation of state mines." * 



The more common form of state monopoly is that which occupies 

 a middle position, established for reasons of public safety or utility 

 as well as of revenue. The salt monopoly enforced in Prussia was only 

 abolished in 1867, and is still maintained in every canton of Switzer- 

 land. The strongest plea in its defense has been the guarantee by 

 the state of the purity of the article sold, and this phase of the ques- 

 tion has superseded the revenue aspect. Few articles of prime neces- 

 sity, like salt, are subject to monopolies imposed by the state, and by 

 a process of elimination it is only articles of luxury or voluntary con- 

 sumption that are regarded as fit objects of monopoly for the benefit 

 of the state. 



* Bastable. Public Finance, p. 181. 



