New-York tribune., 1905-08-24
MUNICIPAL SOCIALISM.
Sluggish Diuidends-High Ta.raticn
IN Yorkshire and Lancashire.
Halifax. England. Augu

80. expenditures for local improvements tram
uavs and supplies OF water. gar and electric
,,zht These are called municipal investments.
,-ora which good returns may ultimately be ex-
,s-,eo when the capital outlay has been repaid
,,s the interest charges wiped out Mean
,rhne the towns heavily taxed for the debt
..-zice o. all these improvements and corpora
,,o, Industries; and there are discontented rate
srs-s who cannot he convinced that they
.nest 70 he called upon to DO so much for the
sr- generation. Since land values are not
.sxsd and the betterment principle is not recog-
-,,es when areas are improved. the burden Of
supporting the local administration falls upon
restricted number of occupiers. The assessable
value Of their property has increased slowly
With the growth and prosperity Of the town; but
., has not kept abreast with the local indebted
ness when the municipalities have been freely
exercising their borrowing powers. The reform
e-s invariably assume that high rates occur
where there is no municipal trading TO keep
rheun down. and that the burdens are eased
vba- The public services are rnunicipalized. The
principle IS sound. but the wrong tense is used.
The burdens will be lightened when the principal
has been repaid by the operation of sinking
funds. and the profits of various municipal ser
vices are fully available for the relief Of local
taxatlor. In the mean time whatever is saved
hv r7uricinal trading is ordinarily more than
Offset by the largely increased cost Of education.
since the voluntary schools have been thrown
hack on the rates.
American experimenters ought 10 be warned
against drawing TOO elastic conclusions from the
statistics OF local government IN the United
kingdom Those figures are not compiled on
any uniform system. and there are so many
double and triple accounts and both receipts
and payments go into 50 many pockets that only
= trained municipal accountant can understand
The ofHcisI returns Of local taxation. Averages
ciphsrsd Of this tumble Of statistics are par
ricularlv deceptive II the official figures prove
awning at least one-thtrd Of the local in
6ebtedness Of the United Kingdom represents
tsrways. electric supply. gas, water and other
undertakings which are a source Of profit, and
The average corporation rate IN England is
about three shillings on the pound. and in Scot
land perhaps threepence less. These favorable
results are transformed whenever an individual
case is considered The total rate, for example
in this old wooIlen town of Halifax is nine
shIungs instead OF three, and, while about So,
$4,000 OF the aggregate Indebtedness Of SIG,
10000 represents capital invested in municipal
undertakings. the total profits available when
the interest charges and allowances for depre-
citation have been set aside are not equivalent
n a saving OF more than eight and one-half
surplus IS turned into the treasury and that the
saving Is actually effected The town, with IT'S
population OF over one hundred thousand has
rnunicipalized gas. water. electric light markets
slaughter houses, rramways and cemeteries and
SIS corporation property is valued at ST 100000
j IS well governed. and ranks among the most
progressive municipalities IN England: yet taxa
zion is high in consequence OF the debt service
and the school and poor rates, ana there has
been 10 marked relief from the various under
takings IN which large masses of capital have
been invested Doubtless il will come in the
course of thirty years, when the debt is scaled
down; hut for the present the rates are rising
high instead Of falling, and taxpayers are won
dering whether they may not be exhausting
their own resources for the benehs Of their
grandchildren.
Other Industrial cities nea- Halifax have ha1
similar experience. Burnley's gross rate is
seven shnlings with a saving ot ninepence IN
municipal services. Blackburn's tax ra14 is se--en
shilngs and sixpence and nothing is turned
into the treasury from municipal trading VOL
rerhaupton has the exception lis high rate Of
ten shlllings one penny the pound. and the
profits on its municipal industries are equivalent
n saving Of three and one-half pence The
rates fall in England in old towns which have
not done much borrowing. and in new cities
which have been administered with unusual
economy: but seldom do they drop below six
shnlngs on close assessment Of valuation. The
saving from municipal services also rises 10 A
shilling in Liverpool and Leeds. and above IT in
Wgan. Darlington. Nottingham. MacclesheId
Devshury and Bolton; but in these instances
the tramways and the gas supply have been
conducted with exceptional thrift and practical
ability Ordinarily there is no profit from
water. he electric supply is not self-sustaini
and there is moderate profit from the tram
ways and gas, unless 30 10 per cent Of the
capital represents plant and goodwill pur-
chased from private corporations. In every
vel regulated English town something is left
for the relief of local taxation when the ac-
counts - the various municipal enterprises are
balanced. but the profits from this source have
hses exaggerated by ENTHUSIASTS and really
repressrt a small percentage of the capital in
vested
Municipal ownership was not undertaken in
me frs instance for the sake Of hlling ex-
hsusted treasures Its main object was not
no2sy making. out good government The
sTsrrrirg hives of population in cities required
sn enlarged water supply, cheaper gas, an i'm
l-rved trarnvvay service with lower fares. the
dssznce Of slurns. the development OF sub
urhsn areas the construction OF parks and
ne opening Of public Libraries and art galleries.
These works were ordered because they were
Indispensable 20 public welfare, and not be-
cause municipal insnciers expected that they
would and them highly remunerative. When
large mss Of local Indebtedness had been
crested N carrying out these municipal under
takiEgs. II became necessary 10 introduce cleo
TIC power sor trarnways and street lighting
'ld 70 Increase the capital already invested.
~ the municipalities were borrowing at once
'ho On Jess fsvora bic terms than formerly, and
IS the irteree. charms "a m the councils we're