FOREST TAXATION IN THE UNITED STATES oot 
supported solely on its merits and in the light of the desired objective 
and the cost apportioned on a sound and ‘reasonable basis. ‘Thus it 
is reasonable that the Federal Government contribute to the cost 
of a transcontinental highway and that the State share the cost of an 
intercounty highway. Or, since forest-fire prevention is essential to 
the conservation of an important national resource, it would seem to 
be a legitimate field of Federal aid. The local governments should 
not be encouraged, however, to turn constantly to the State and 
Federal treasuries whenever they want something that they are 
unwilling to pay for themselves. Neither should the aid be employed 
to retard a redrafting of districts or a reallocation of functions. 
The relative position occupied by subventions and grants in the 
revenues of selected forest and agricultural communities was shown 
in part 2. The figures there given indicate that forest communities - 
have generally come to be more dependent on aids of this sort than are 
the more highly developed communities. This might be expected, 
for sparsely settled communities cannot ordinarily provide govern- 
mental services at as low cost per capita or per dollar of assessed 
value as the more thickly settled communities, and the aid is designed 
to mitigate the inequality. Under the most widely prevailing systems 
of local government forest communities are likely to suffer an abnor- 
mally high tax rate unless they receive aid. But the fact should not 
be overlooked that such aid involves an added burden on taxpayers 
outside the district, and in fairness to these taxpayers the eid should 
not be dissipated in needless overhead expense. At best, State and 
Federal aid should in no way remove the obligation for economical 
administration of government in the jurisdictions so aided. 
In neither the support of schools nor the support of other functions 
of local government have there been many bold attempts to prorate 
the cost between the local unit and the State on the basis of benefit or 
to effect a new distribution of functions. Likewise, there have been 
few efforts to zone rural territory according to population and eco- 
nomic outlook and limit governmental functions accordingly. In 
spite of attempts at equalization through State aid, the costs of local 
government generally bear little relation either to the quality of serv- 
ices enjoyed or the ability of the people to support them. 
While part of the high cost of local government in rural areas is due 
to overorganization and an improper distribution of functions, some 
of it must be attributed to faulty administration. Antiquated ma- 
chinery, untrained personnel, diffusion of responsibility, and the 
absence of those safeguards which are essential to the smooth func- 
tioning of democracy all contribute to high administrative costs. 
A fuller application of the short ballot, more rigid fiscal control, and 
a large degree of State supervision and guidance have proved useful 
aids to improved administration and in no way inimical to the preroga- 
tives of local self-government. 
The development of State supervision has been traced because there 
is evidence that it has resulted in a saving to local taxpayers and be- 
cause it is believed that State supervision can be expanded with profit, 
particularly in respect to financial practices. 
One may observe losses on every hand that sound financial practices 
would have averted. These losses take many forms—losses through 
bank failures, depleted sinking funds, needlessly heavy interest rates 
101285°—35——22 
