786 POPULAR SCIENCE MONTHLY. 



but which should be reserved for public control and administration, 

 either by the Government directly or by public agents acting under 

 such conditions and regulations as the Government may impose in 

 the public interest and for the public security." * A necessary con- 

 dition, then, is a public interest in the occupation or privileges to 

 be followed. The good will of a person or individual trader is not 

 a franchise in this sense, though a franchise may be enjoyed by an 

 individual as well as by a corporation, and good will may rest upon 

 the privilege implied in the franchise. 



The recognition of franchises, a species of property " as invisible 

 and intangible as the soul in a man's body," as a proper object for 

 taxation is now beyond any dispute. It is peculiarly appropriate as 

 a source of revenue for the exclusive use of the State, inasmuch as 

 the grant of franchises emanates from the State in its sovereign 

 capacity. In the case of Morgan vs. the State of Louisiana, Justice 

 Field, of the Supreme Court of the United States, said: " The fran- 

 chises of a railroad corporation are rights or privileges which are 

 essential to the operation of the corporation and without whifeh its 

 roads and works would be of little value, such as the franchise to 

 run cars, to take tolls, to appropriate earth and gravel for the bed 

 of its road, or water for its engines, and the like. They are posi- 

 tive rights or privileges, without the possession of which the road 

 or company could not be successfully worked. Immunity from 

 taxation is not one of them." f Further, the extent to which this 

 taxation of franchises may be carried rests entirely in the discretion 

 of the taxing power, subject only to constitutional restrictions. 



The great difficulty in applying such a tax lies in the methods 

 of reaching an understanding on the value of the franchise. How 

 can this indefinite something be made visible on the tax books? In 

 many instances the franchise may be regarded as inseparable from 

 the real property of the corporation. The rails of a tramway, the 

 poles and wires of a telegraph company, the pipes and conduits of a 

 gas company, are real and tangible things, necessary to a proper 

 conduct to the respective functions of the corporations. But the 

 right to lay tracks in the public streets, to sink pipes under the 

 streets, or to string wires overhead is as necessary a possession and 

 as essential to the performance of what the corporation was created 

 to accomplish. Whether this permits the franchise to be regarded 

 as " real estate " and so offers it for taxation is a question of some 

 theoretical interest, but of little practical importance.^: Unless the 



* California vs. Southern Pacific Railroad, 127 U. S., 40. 

 \ 98 U. S. Reports, pp. 217, 224. 

 J A recent law of New York is very full on this point : 



" The terms ' land,' ' real estate,' and ' real property,' as used in this chapter, include 

 the land itself above and under the water, all buildings and other articles and structures, 



