cash to the larger market, and uncomplainingly pay the high prices for whatever they are compelled to buy locally, or they can contract to give the local store all their trade, paying cash, at an agreed profit upon actual cost to the dealer. When the trade of an individual is large, this last arrangement can ordinarily be made, provided the dealer feels confident that nothing will be said about it. It will not usually pay him to get only one customer at the expense of letting the whole neighborhood know his scale of profits. It is quite customary -and it is an excellent custom-for granges, or other farmers' societies, to buy at wholesale, for cash, and distribute to their members. It will frequently, if not usually, happen that quite as much profit, and far more convenience, will be gained by working the trade through the local dealers. In the first place, the dealer, if in good credit, can usually buy cheaper than any grange. It is entirely common for granges ordering from wholesale dealers, to imagine themselves to be getting the lowest net rates, when, as a matter of fact, a local dealer may be regularly receiving a percentage on all their purchases. There are many wholesale firms which will fill orders from such bodies at what they term "wholesale rates," and credit any customer in the town with a fair profit on the transaction, or, if there be two customers, divide it between them. The reason is that the trade customer buys more goods than the farmers, and is likely to buy much larger, and it will not pay to offend him for the profit to be made on a few direct orders from those who should be his customers.

Still, if the grange buyers spend time enough and study enough to keep fully in touch with the market, they can obtain, for such ordinary goods as they buy, lower prices than the local dealer can make for them under any circumstances. They can hunt until they find some wholesaler from whom the local dealer does not buy, and who will not therefore care about "protecting" his trade. Even this, however, is not certain. I have known a wholesale house to fill such an order, and credit a profit to a dealer who was not dealing with them at all. A little later, of course, the dealer's trade will be solicited, and some part of it probably obtained. It will

take farmers a long time to understand all the tricks of trade. It is a question whether it will not pay them best to work with the local dealer. It depends, of course, upon circumstances, but as a rule I think most money will be made in that way by the farmers.

But one thing is sure: if the farmer becomes seriously indebted to the local tradesman he will pay roundly for his folly. This is not, necessarily, because the dealer is a grasping, hard-hearted man, but because he must charge high prices to pay for the risk. For some of the goods sold on credit he will never be paid. He can not tell which these will be, or usually would not sell them, but it is a necessity of business that those who pay must help to support those who do not. The dealer can not bear the entire burden. Those who can pay cash, however, need not pay any part of these bills unless they choose to. If, as already said, one's trade is large, he can manage this matter individually. If it be small, he can only obtain this benefit by combination with his fellows.

I have but one thing farther to say upon this subject, which is that all retail trade is infected with fraud. If a farmer buys ground coffee or spices, oils, paints, or even flour and sugar, he can not be certain that he gets what he pays for. The demand of the farmer for "cheap goods" induces extraordinary efforts to supply it. This is done by manufacturers who adulterate goods, or skimp the weight of packages at the demand of retail dealers who wish to be thought to sell cheaply. It is well to beware of all who pretend to offer extra inducements in the way of prices. The manufacturers and wholesalers usually make no more money on sophisticated goods than upon those which are honestly made, or put up. The retailer, if he at all understands his business, knows perfectly well what he is buying. He should be held rigidly accountable to customers for quality and weight. All persons dealing with concerns having a special reputation for low prices should faithfully check off goods bought by weight or measure. The cost of goods is about the same to all retailers in good credit, and except as they transact specially large volumes of business, their scale of profits must be about the

same. Still it is true that the retailer with a surplus of available cash capital can save money in buying, just as the farmer can. No general rules can be laid down other than those already suggested, as to the best profitable methods of dealing with retailers. It will depend upon the circumstances of each case.

I

CHAPTER VI.

THE FARMER AND THE TAX-GATHERER.

T has become evident that the pressure of taxation in the United States is to increase until our burdens are quite

equal to those of the European people. There is a tendency to demand a constantly increasing service from the national, state, and local governments, and all this service costs money. We shall certainly push these demands until. we have reached the limit beyond which the people will not endure taxation. The fact that there is such a limit, not difficult to reach, impairs the credit even of the richest nations, in regard to what may be termed questionable forms and occasions of indebtedness. Universal experience shows that when a certain limit of taxation has been reached, a nation, or any political subdivision thereof, will repudiate its indebtedness. It will usually be possible to raise some quibble, or even some equitable contention, but at any rate no people will tax itself above a certain limit. So long as public funds are expended in such a manner as to make an equivalent saving in private expenditure, the limit of taxation may be extended indefinitely. If they are expended wastefully, the limit will be reached whenever the public burden, added to the necessary private expenditure, according to the prevailing standard of life, consumes the income of the average man. When a people is brought to a choice between evading a portion of the public debt, or permanently reducing the standard of life, it will not, if it can be avoided, adopt the latter alternative.

While we are as yet, happily, far within the limit of endurance of taxation, it is never too early to take into consideration the fact that there is a limit, or to remember that every dollar wasted in the expenditure of public funds is a dollar less to be expended for the comfort of him who has earned it. In this

country there is great waste of public money-more, doubtless, than in any other nation of the blood of the thrifty nations of Northern Europe. This is not because we are not intelligent and vigorous, but because our past has been to us a time of great things, and we have been too busy and too prosperous to feel the necessity of economy in public affairs. The opportunity, as always, has brought forth the men, and we have developed a class, larger and more astute than exists elsewhere of the same sort, which expects to thrive at the unnecessary expense of the public. Habits have been formed, and precedents set, which we now find it difficult to get rid of.

Our fiscal misfortunes include inequalities of taxation. and extravagance in expenditure; and extravagance may include economical expenditure for desirable objects, when beyond the means of the community incurring it. It is no more possible to the poor community than to the poor individual to practice all the economies of wealth. A rural community might bankrupt itself by the building of a stone road or an irrigation system, in the absence of other capital to make use of them. There must be traffic to justify the stone road, and the use of lands to justify the building of an irrigation system, and both these involve large investments of capital in addition to the cost of the improvements.

It is doubtless true that few taxes are justly assessed. Incidentally I have said something about our system of taxation elsewhere in this volume.* I do not intend to add much to what has been said there. We are committed to the system of raising most of our taxes for state and local purposes by an ad valorem assessment upon what is called the "value" of all property which can be found. Experience shows that propertyholders will lie to get rid of taxation, and that the number who do this is so great that it is a physical impossibility to deal properly with the criminals. In medieval times the thumbscrew and the iron boot were employed in assessing rich men.t Even those methods seem not to have been

* See book Sixth, chapters I and IV.

Farmers, and other comparatively poor men, doubtless pay an undue share of taxes, but it is mainly because they can not conceal their property. When