GENERAL PRINCIPLES 21 



other reforms, a similar simplification and 

 reorganisation is required as regards local 

 finance. 



The consideration of the canon of 

 economy suggests a natural transition to 

 the principles of expenditure. The greatest 

 master of finance this country has produced, 

 asserted that good finance consists rather 

 in the spending than in the raising of 

 money. On the present occasion the sub- 

 ject of expenditure will only be touched 

 on so far as necessary in dealing with 

 taxation. The connection is of course very 

 close, and in my opinion, for every rule 

 of taxation there is, or ought to be, a 

 corresponding rule of expenditure. 1 Take 

 the fundamental principle of equity. In 

 estimating the real burden of taxation we 

 ought to deduct the benefits that are derived 



1 See my " Principles of Political Economy," Bk. v., 

 chaps, xv., xvi. 



