September 4, 189 r.] 



SCIENCE. 



131 



erty held by the inhabitants of a great city at anything less 

 than the total value of the real estate, and it is my opinion 

 that it is much more. According to the report of the tax 

 commission of the State of New York in 1871, the real estate 

 assessed in that State for the years 1869-70 was more than 

 three and one-half times as valuable as all the personal prop- 

 erty owned by citizens of that State. In the city of Brooklyn 

 the valuation of real estate was over ten times as much as 

 that of personal property, Rochester over six times, Buffalo 

 and Albany over four times as much, In the city of New 

 York it was nearly two and one-half times as much. One 

 county in New York reports real estate worth seventy times 

 as much as all the personal property owned by its citizens. 

 Massachusetts, which has perhaps the best enforced law of 

 this kind, does not reach over two thii-ds of the personal 

 property in the opinion of its tax collectors. Connecticut 

 misses forty per cent. One may almost say that in the large 

 cities much the larger half of the personal property escapes 

 taxation altogether. That means, of course, that the other 

 forms of property are disproportionately burdened. The 

 total personal property of the entire State of New York was 

 returned in 1870 at $434,000,000. Why, there were at that 

 time in the city of New York alone twenty-five individuals 

 who together probably possessed that sum. The value of the 

 steam railroads in that State in that year was $300,000,000. 

 In a debate in the constitutional convention of 1867, Mr. 

 Pierrepont of New York said that he could name thirty in- 

 dividuals in New York City whose combined personal prop- 

 erty exceeded the whole assessment of the State for that year 

 by a very large sum. The whole personal property assess- 

 ment of the city of Brooklyn against private individuals for 

 the year 1867 was less than ten million dollars. Possibly it 

 had a single citizen who was worth that amount. 



But why multiply examples. They are like sands of the 

 sea for multitude. Now, under any such a system as this, 

 those classes who have, comparatively speaking, little per 

 sonal property are the ones who must bear the burden of 

 taxation. Who are they ? Speaking generally, the farmer 

 in the country and the small man in the city; the laborer 

 who has saved up money to buy him a little house, and 

 whose whole property is, therefore, open to the assessor; the 

 farmer who has put all his money into his farm. Who profits 

 by it ? The man of means who invests his money in rail- 

 roads, bank stock, gas companies, etc. 



The objection which I have been urging against the gen- 

 eral-property tax which forms the backbone of our system 

 would apply more or less to the system at all times; but it is 

 becoming more and more potent as time goes on, owing to 

 the fact above mentioned that the proportion of wealth in an 

 immaterial form, such as stocks and bonds, is steadily in- 

 creasing. I hardly need to dwell upon this point. You all 

 know how enormously the value of railroads in this country 

 is increasing. Nearly all of it consists of immaterial or per- 

 sonal property; or where it consists of real estate, the value 

 of such real estate cannot be measured by the ordinary 

 standards, but it possesses a value growing out of the pecu- 

 liar business of the railroad which is rarely reflected as it 

 should be in the tax books. The railroad is the most strik- 

 ing example, but not even is it so important as the aggregate 

 of similar undertakings in other lines of business. Consider 

 for a moment the stock of express companies, telegraph com- 

 panies, telephone companies, gas companies, electric lighting 

 companies, joint stock banks, manufacturing companies, etc. 

 Indeed, the marked tendency of capital to-day is to assume 

 the corporate form, owing, among other things, to the ease 



with which it escapes taxation. This is a phenomenon of 

 comparatively recent date. The corporation first became a 

 prominent feature of our industrial life, as of that of other 

 countries, since 1850. There were, of course, many corpora- 

 tions before that date, and one or two flush periods when 

 nearly everybody took a hand in them, but they were con- 

 fined to few departments of industry. After 1850 they grew 

 rapidly. In Germany, for example, only 54 are known to 

 have been founded before 1850, while 1,150 have been formed 

 since that time. In Austria there were in 1857 only 58 in 

 all, but they had risen to 731 by 1873. England and America 

 are, however, the classic lands for the development of cor- 

 porations. In 1844 there were 119 in England, but they had 

 increased to 2,549 in 1862, and by 1886 over 25,000 had taken 

 out charters, though many of them had wound up their 

 affairs, so that only 11,000 were in operation in that year, 

 with a paid up capital of over three thousand millions of 

 dollars. 



In this country we have accurate statistics only for a few 

 of the States, and then only in regard to certain formal facts. 

 In Massachusetts, from 1852 to 1863, anywhere from ten to 

 fifty companies were formed each year. The next three years 

 averaged three times as many; then came a long period up 

 to 1880 in which about seventy-five to one hundred were es- 

 tablished each year, and since 1880 an enormous number 

 have been formed, rising to 233 in 1889. The total capital 

 of these companies aggregated upwards of 8300,000,000. la 

 the State of Ohio in 1889 over three hundred corporations 

 for manufacturing purposes were organized, and the average 

 for the last ten years has been over two hundred. Now all 

 these things mean, of course, that property of the community 

 is all the while taking on more and more the personal prop- 

 erty form, is leaving the country for the city, and that any 

 general-property tax system is becoming more and more un- 

 equal owing to impossibility of keeping track of it. With 

 every passing year, then, our present system is becoming- 

 more and more untenable, and yet we are not ready to break 

 with it. 



There is still another circumstance which should be con- 

 sidered in this connection before leaving it. as having a 

 special relation to the farming classes, and that is the rapidly 

 changing proportion between town and country population. 

 It is easier to avoid personal property taxation in the city 

 than in the country. And thus from this reason also the 

 burden of taxation becomes more unequal. In 1790 only 

 three per cent of the population of the United States lived in 

 cities of 8,0n0 and upwards In 1800 (using round numbers), 

 four per cent, in 1810 five per cent, 1830 seven, 1840 nine per 

 cent, 1850 thir:.een, 1860 sixteen, 1870 twenty-one, and in 

 1880 twenty-three. It is not yet known exactly what the 

 new census will show in this respect, as the population of all 

 cities above eight thousand has not been given. But some 

 figures have been given to show that this tendency has steadily 

 increased. In 1880 there were twenty four cities in the 

 United States with 75,000 inhabitants and over, while in 1890 

 this number had increased to thirty-four, i.e., while ten years 

 ago about thirteen per cent of the people of the country were 

 living in cities of 75,000 and over, to-day over sixteen per 

 cent are to be found in such cities. The increase of these 

 thirty-four cities, without counting New York, has been 

 almost forty- five per cent, while the general increase in the 

 country as a whole has not exceeded twenty-five per cent. 

 Reports have been also published of forty-two other cities 

 having a population of 20.000 or over. The increase in the 

 seventy-six cities over llie population of the same cities in 



