220 



A. L. Bishop — The State Works of Pennsylvania. 



In view of what lias been said, tlie unsoundness of tlie policy 

 adopted and perpetuated by Pennsylvania iu the financing of the 

 public works is now apparent. For the above contains numerous 

 instances of lines of policy pursued which were contrary to the 

 principles of any safe system of finance such as was adopted in 

 New York. As a natural result of almost a complete dependence 

 upon loans to build the works, and to pay the interest on the 

 ever-increasing debt, serious complications arose. So long as the 

 money market was easy, and the credit of the state was unques- 

 tioned, there Avas no need of any apprehension concerning the 

 prompt payment of the interest. But Avhen these conditions no 

 longer existed, there could be no doubt as to what must be the out- 

 come. With a constituency almost wholly unaccustomed to pay- 

 ing taxes, with no well-organized system of taxation ready to be 

 put into operation in case of emergency, bankruptcy was thus 

 inevitable. 



It now remains to examine the influences which determined the 

 adoption and persistent carrying out of this financial policy. While 

 •not overlooking in this connection the influence of the easy money 

 market, it seems fair to say that this course was due to two princi- 

 pal causes, viz. — the reluctance of the people to pay taxes, and a 

 general overestimation of the potential productivity of the public 

 works. The evidence presented by contemporary writers indicates 

 that taxation on general principles was peculiarly odious to the 

 people of Pennsylvania, and that the legislators, from the dread 

 of unpopularity, hesitated to resoi't to this method of raising 

 revenue.* Moreover, it was confidently believed that if, in one 

 way or another, sufiicient money could be raised to defray interest 

 charges until the works were completed, then the treasury certainly 

 would be filled to overflowing with the revenue from canal and 

 railroad tolls. In referring to the tax laws of March 25th, 1831, 

 Governor Wolf shed much light upon the question under considera- 



* "No adequate funds were provided for tlie payment of tlie interest on the 

 loans. In some cases new loans were negotiated for that purpose. Hence, 

 the credit of the state suflfered severely, and money was sometimes borrowed 

 on disadvantageous terms. This unmanly and discreditable conduct arose 

 from a paltry dread of unpopularity, the imposition of taxes being at all 

 times and in all countries viiipopular; and thus the public interest was 

 sacrificed to this unworthy motive. — Carey, Brief View of the System of 

 Internal Improvements in Pennsylvania, pp. 15-16. 



