Virtue is Needed for Public Finance

It is particularly in this delicate part of the administration that virtue is the only effective instrument, and that the integrity of the Magistrate is the only real check upon his avarice.

Books and auditing of accounts, instead of exposing frauds, only conceal them.

Prudence is never so ready to conceive new precautions as knavery is to elude them.

Never mind, then, about account books and papers; place the management of finance in honest hands: that is the only way to get it faithfully conducted.

When public funds are once established, the rulers of the State become of right the administrators of them.

for this administration constitutes a part of government which is always essential, though not always equally so. Its influence increases in proportion as that of other resources is diminished.

A government has reached the last stage of corruption, when it has ceased to have sinews other than money.

Every government constantly tends to become lax. This is why no State can subsist unless its revenues constantly increases.

The first sense of the necessity of this increase is also the first sign of the internal disorder of the State.

The prudent administrator, in his endeavours to find means to provide for the present necessity, will neglect nothing to find out the distant cause of the new need; just as a mariner when he finds the water gaining on his vessel, does not neglect, while he is working the pumps, to discover and stop the leak.

From this rule is deduced the most important rule in the administration of finance, which is, to take more pains to guard against needs than to increase revenues. For, whatever diligence be employed, the relief which only comes after, and more slowly than, the evil, always leaves some injury behind.

While a remedy is being found for one evil, another is beginning to make itself felt, and even the remedies themselves produce new difficulties: so that at length the nation is involved in debt and the people oppressed, while the government loses its influence and can do very little with a great deal of money.

I imagine it was owing to the recognition of this rule that such wonders were done by ancient governments, which did more with their parsimony than ours do with all their treasures; and perhaps from this comes the common use of the word economy, which means rather the prudent management of what one has than ways of getting what one has not.

But apart from the public demesne, which is of service to the State in proportion to the uprightness of those who govern, any one sufficiently acquainted with the whole force of the general administration, especially when it confines itself to legitimate methods, would be astonished at the resources the rulers can make use of for guarding against public needs, without trespassing on the goods of individuals.

As they are masters of the whole commerce of the State, nothing is easier for them than to direct it into such channels as to provide for every need, without appearing to interfere. The distribution of provisions, money, and merchandise in just proportions, according to times and places, is the true secret of finance and the source of wealth, provided those who administer it have foresight enough to suffer a present apparent loss, in order really to obtain immense profits in the future.

When we see a government paying bounties, instead of receiving duties, on the exportation of corn in time of plenty, and on its importation in time of scarcity, we must have such facts before our eyes if we are to be persuaded of their reality. We should hold such facts to be idle tales, if they had happened in ancient times.

Let us suppose that, in order to prevent a scarcity in bad years, a proposal were made to establish public granaries; would not the maintenance of so useful an institution serve in most countries as an excuse for new taxes?

At Geneva, such granaries, established and kept up by a prudent administration, are a public resource in bad years, and the principal revenue of the State at all times. Alit et ditat is the inscription which stands, rightly and properly, on the front of the building. To set forth in this place the economic system of a good government, I have often turned my eyes to that of this Republic, rejoicing to find in my own country an example of that wisdom and happiness which I should be glad to see prevail in every other.

How does the needs of a State grow?

They generally arise like the wants of individuals.

They arise less from any real necessity than from the increase of useless desires.

Expenses are often augmented only to give a pretext for raising receipts.

In this way, the State would sometimes gain by not being rich, and apparent wealth is in reality more burdensome than poverty itself would be.

Rulers may hope to keep the peoples in stricter dependence, by thus giving them with one hand what they take from them with the other.

This was the policy of Joseph towards the Egyptians.

But this political sophistry is the more fatal to the State, as the money never returns into the hands it went out of. Such principles only enrich the idle at the expense of the industrious.

A desire for conquest is one of the most evident and dangerous causes of this increase.

This desire is not really from a the desire to aggrandise the Nation.

It is from a secret desire to increase the authority of the rulers at home by:

• increasing the number of troops
• diverting the minds of the citizens through the objects of war

The people of conquering nations are the most oppressed and wretched.

• Their successes only increases their misery.

History has shown that the greater a State grows, the heavier and more burdensome in proportion its expenses become.

Every province has to furnish its share to the general expense of government, and besides has to be at the expense of its own administration, which is as great as if it were really independent.

Add to this that great fortunes are always acquired in one place and spent in another. Production therefore soon ceases to balance consumption, and a whole country is impoverished merely to enrich a single town.

Another source of the increase of public wants, which depends on the foregoing, is this. There may come a time when the citizens, no longer looking upon themselves as interested in the common cause, will cease to be the defenders of their country.

The Magistrates will prefer the command of mercenaries to that of free-men; if for no other reason than that, when the time comes, they may use them to reduce free-men to submission.

Such was the state of Rome towards the end of the Republic and under the Emperors: for all the victories of the early Romans, like those of Alexander, had been won by brave citizens, who were ready, at need, to give their blood in the service of their country, but would never sell it.

Only at the siege of Veii did the practice of paying the Roman infantry begin.

Marius, in the Jugurthine war, dishonoured the legions by introducing freedmen, vagabonds and other mercenaries.

Tyrants are the enemies of the people they protect. They maintained regular troops to really enslave their countrymen.

To form such troops, it was necessary to take men from the land.

The lack of their labour then diminished the amount of provisions. Their maintenance introduced those taxes which increased prices.

This first disorder gave rise to murmurs among the people.

In order to suppress them, the number of troops had to be increased. Consequently, the misery of the people also got worse.

The growing despair led to still further increases in the cause in order to guard against its effects.

On the other hand, the mercenaries, whose merit we may judge of by the price at which they sold themselves, proud of their own meanness, and despising the laws that protected them, as well as their fellows whose bread they ate, imagined themselves more honoured in being Cæsar’s satellites than in being defenders of Rome.

As they were given over to blind obedience, their swords were always at the throats of their fellow-citizens.

They were prepared for general butchery at the first sign. This was one of the principal causes of the ruin of the Roman Empire.