PRINCIPLES OF TAXATION. 9 



Ion. The average annual consumption by the people of Illinois at 

 the time, supposing that they actually paid the tax on their prod- 

 uct of whiskey, must have also been at the rate of over six gallons 

 per head for every man, woman, and child of its population. 



When " an act to reduce taxation to provide revenue for the 

 Government and for other purposes" passed August 28, 1894 

 was under consideration by the Senate of the United States ; and 

 pending a proposition to increase the revenue by increasing an 

 existing tax of about seven hundred per cent on the average prime 

 cost of distilled spirits to a rate of near nine hundred per cent, a 

 Senator of long experience, apparently utterly oblivious that the 

 subject involved had years before been thoroughly considered by 

 the United States Treasury Department and declared to be im- 

 practicable, submitted a motion, permitting the use of alcohol in 

 the arts, or in any medicinal or other like compound, without the 

 payment of any internal revenue tax. The motion in question, 

 after very brief consideration, was accepted and incorporated in 

 the statute and now forms a part of the fiscal obligations and laws 

 of the United States. The result was that the Secretary of the 

 Treasury reported, that in default of any appropriation to defray 

 the expenses of the administration of the act and the repayment 

 of taxes, and ^' after full consideration of the subject, and an un- 

 successful attempt to frame regulations which would protect the 

 Government and the manufacturers, the department was con- 

 strained to abandon the effort." It was also estimated that the 

 expense to the Government of attempting to administer the act 

 would probably be not less than one million dollars per annum ; 

 that the legitimate loss of revenue contingent on its enforcement 

 would be about ten million dollars yearly, or " more than one half 

 of the estimated increase of revenue" that it was expected to 

 accrue from the increase of the tax, and that the loss of revenue 

 from the opportunity for illicit and fraudulent practice, which the 

 act would facilitate would be unquestionably very considerable 

 probably an equal amount. The inference from all of which is, 

 that when a State sends a representative to the United States Sen- 

 ate who, through indifference or gross ignorance of the most com- 

 mon principles and domestic experiences of taxation prospective- 

 ly, entails a loss to the Government of some twenty million dol- 

 lars per annum, it pays a very great price for such a privilege. 



During another comparatively recent fiscal debate in the 

 United States Senate, a Senator, who is popularly and justly ac- 

 credited with statesmanship, advocated certain proposed appro- 

 priations of the public money, which were opposed on the ground 

 that they were in the nature of extravagances, by saying that 

 they could not be grievous to the people " since they would not 

 amount to more than three cents per day per capita." But three 



