New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1912-06-26
TAXATION IN MINNESOTA
rwENrY-sEcoND ARTICLE
The Cost OF Government In Mimi
esOta No. 3.

| Taxes are compulsory contribu.
ton toward the expenses of govern.
ment, and all citizens are supposed
to contribute according to their sever.
al tax-paying abiliets. In like man.
ner fees and fines are compulsory con.
tributions, not indeed according to tax.
paying abilities, nor from all citizens,
but from all Of certain classes or In
certain circumstances. All of these
receipts are consequently classed as
general revenues, and the sum to-
tai Of general revenues taken from
the people in the long run measures
the true cost of government.
In contrast to general revenues, COM
mercial revenues are received by the
government in return for some spe-
cial service In paying such sums
to the government, the citizens mere
ly pays for value received, much as he
does at grocery or dry goods store.
It is on this account that the name
Commercial revenues" Is employed
for this class of receipts. For exam
pie, when a man pays a special assess
ment for a ditch, or sewer, or side
walk, he is helping to pay for pub
lie improvement which is supposed to
increase the selling value of his pro-
perty by at least the amount Of his
assessment. In case it does this, he
gets back, in another form, all that he
pays. Only in case he is assessed
more than the benefit to his property
is he taxed at all, while in all cases
where he is assessed less than the
benefit to his property, he actually
profits by the transaction. 1t is clear,
therefore. that special assessments,
unless in excess of benefit to the pro-
perry, are not part of the cost OF
government On this account 1t is
essential to separate special assess
ments from taxes, special assessment
loans from general loans, and inter-
est payable on special assessment
loans from interest on general loans.
The same line of reasoning applies
even more clearly to publicly opera
ted public service enterprises, such
as waterworks, electric, gas, heating
and power plants, telephones, scales,
markets, auditoriums, skatingrinks, &C.
meteries, warehouses, ferries, and
other enterprises which furnish to the
public a specific COMMODITY or service
in return for specific price. In all
these cases, the public enterprise is
merely a substitute for some private
enterprise which would otherwise be
patronized. What the individual pays
for it's service is therefore as little
part of the cost of government as wha+
he would pay to similar private con-
Germs. Such public enterprises conse-
uuently figure in the cost of govern
ment only in the event, and to the ex-
tent, that they fail to be self supper
ting and consequently become a
charge on the general revenues. For
this reason. as in the case of special
assessments, it is essential that the
receipts and payments for all public
service enterprises, the debts incur
red on their account, and the pay
es. ment of interest and principal, on
such debts, be kept entirely distinct
from all similar items pertaining to
the municipality in general. Unless
such separation is rigidly carried
through, it is hopeless to attempt to
learn the real cost of government.
The next article in this series will
consider certain fundamental distinc-
tons between classes Of expenditures,
in relation to the cost of govern