tion, an important decision recently rendered by the supreme court of New Jersey is not to be overlooked. The case was that of the city of Newark vs. the North Jersey Street Railway, and the issue involved was the legality of the city's tax upon the company's road-bed. The local authorities had treated the road-bed as real estate, and assessed it as such under the general property tax. The corporation appealed to the state board of taxation, and secured a heavy reduction of the tax on the singular ground that "the trolley company had no greater right in the street than the traveler upon it, and that it therefore had no taxable interest in it." This was obviously contrary to fact and experience. The controversy was taken into the courts, and the supreme court has sustained the position of the Newark assessors. It says: "As between Newark and the North Jersey Street Railway, the latter has acquired the right to lay in the soil the foundations for its rails, to lay rails thereupon, and the right to the continuous uninterrupted occupancy of such part of the public estate. Its poles and its tracks are there permanently, to the exclusion of any other person that might desire to occupy the land, and during the life of the grant the city of Newark will be without power to remove them. The company has a grant of a part of the public estate as its own permanent, exclusive use, and that is an interest in real estate; the part must be of the same character as the whole. 99 tion of corporate property, especially of the intangible kind. A body of law is slowly being evolved, and the principle of equality of burdens is asserting itself. Resistance on the part of short-sighted corporations to equitable taxation and reasonable control is undoubtedly responsible for much of the favor which the alternative of municipal ownership and operation of public utilities is now receiving. The taxation of special franchisesthat is, exclusive privileges granted by the state or munic WILLIAM H. TAFT, Philippines. ipalities to corporations performing quasi-public functions-will probably receive an impetus First Civil Governor of the from the remarkable decision recently rendered by the supreme court of Michigan. Only in a few states are franchises taxed. New York enacted a law about two years ago taxing them as real property. The constitutionality of that act is still in doubt. New Jersey has adopted the plan of imposing a two per cent tax on the value of franchises. In some states it is the municipal governments which demand and obtain "compensation" for the special privileges a policy which is not free from objections, for the companies compelled to pay a percentage of their receipts are slow to improve their service and to reduce their rate of fare. Municipal reformers have not regarded "compensation" with any degree of favor. Here and there bold officials have asserted that even under the general laws for the taxation of property the full value of franchises may be taxed. This contention is now supported by the unanimous opinion of so able and learned a tribunal as the Michigan supreme court. The street railway company of Detroit had been assessed on the value of its intangible property, its franchises, though there is no express legislation in Michigan. for the taxation of franchises. The company objected, and has been defeated in the courts. In the opinion referred to it is held that there is no occasion for specific and express legislation authorizing such taxation. The constitution of the state demands equal and would be asked to decide upon the proposition, and there is little doubt as to what their verdict would be. Ten years ago equitable taxation of franchises might have operated as a preventive of "municipalization," but now this remedy is plainly insufficient in the eyes of the majority. In all parts of the country the movement for municipal ownership is steadily and rapidly gaining ground. uniform taxation of property of all kinds, and there is no doubt that special privileges are "property." There is no excuse, says the court, either for ascribing a fictitious value to property, tangible or intangible, or for undervaluing it or omitting it from the tax roll. A mere right of operating a street railway has no market value, but when an easement in streets and highways is granted, value is Porto Rico is now a part of the great created. A street free-trade union of the states and territories. railway in operation The Foraker act, imposing a fifteen per cent is worth much more tariff on the trade passing between that than are the combined island and the United States, has been suselements which enter pended by a presidential proclamation. The into its construction act itself, limited by its terms to a period as second-hand of two years, had several months of life yet, material. When but it contained a provision that whenever exclusive privileges the legislative assembly of Porto Rico should are associated with adopt a system of local taxation and tangible property the revenue adequate to the island's needs, latter takes on a new and should notify the president of that form and is enhanced fact, the latter might order the cessation often very greatly-in value, and the of the tariff. basis of the market value should be the basis of taxation. Is there any reason, asks the court, for assessing a street railway for less than it would command in the market if sold? It is therefore the right and duty of the assessors and receivers to ascertain the market value of franchises and to assess them at the same rate as other property. EVELYN B. BALDWIN, American Explorer who has started for the North Pole. Several months ago the Porto Rican legislature passed the so-called Hollander tax law, which has recently gone into effect. It has completely revolutionized the tax system of the island, and for the first time in its history provided for a general assessment of all property. At first there was some dissatisfaction with the law, but the American Now there is nothing peculiar about the tax provisions of the Michigan constitution. The organic law of every state in the union. demands equal and uniform taxation, and hence what is true of the franchises of Michigan corporations should be true of franchises elsewhere. No special law for the taxation of such privileges should be needful, and if the tax officials did their duty no franchise having value would escape its share of the tax burden. But, as intimated above, the effects of such taxation may prove far from beneficial to the public. No doubt it is the realization of this fact which is prompting more and more public men to advocate municipal ownership and operation of public utilities. In Chicago, for example, a special committee of the city council, composed of the ablest and most upright aldermen, has drafted a bill for municipal operation of the street railways. Even the conservatives were urging the state legislature over as long as the watch-dog is there." to pass this measure. The voters of Chicago SOUTHE UNCLE SAM:-"I don't believe they will ever come -Minneapolis Tribune. officials assert that all distrust and suspicion have vanished, and that an exceptionally satisfactory condition prevails on the island. There is no debt, and last year's budget has left a surplus of over $1,500,000 in the treasury. The fifteen per cent tariff greatly stimulated trade the Porto Rican-American trade. The law was passed in April, 1900, and the first year of its operation showed an increase of $4,000,000 in our exports to the island and a very material increase in the imports. The steady expansion since the substitution of American for Spanish sovereignty is clearly exhibited in the following table: The fiscal year 1901, ended June 30, was a remarkable one as regards the foreign trade of the country. The expansion of exports continued steadily, despite certain unfavorable factors, such as the war in Imports. China, the campaign in South Africa, and $2,181,024 the trade depression in Germany and Russia. 2,414,356 A considerable decrease in at least certain 3,078,648 lines of American exports would have sur3,748,093 prised no one, yet the figures show an actual and very considerable increase in each of the great classes of merchandise, except manufactured goods, and in this class the loss is rather apparent than real. 3,179,827 The opposition to the American administration has disappeared, and the people look forward to an epoch of prosperity, activity, and harmony. Of course, under the decisions of the supreme court in the insular cases, congress is at liberty to impose a new tariff upon Porto Rican exports to the United States, but this is merely a theoretical possibility. The freedom of trade Porto Rico has secured is as safe and permanent as that Our exports aggregated $1,487,656,544, exceeding those of the preceding fiscal year by over $97,000,000. The imports were valued at $822,756,533, being over $27,000,000 less than those for the fiscal year 1900. The balance of trade in favor of the United States amounted to the tremendous sum of $664,900,000, showing an increase of not less than $120,000,000 over the balance of the previous year. The reduction in the value of the imports is due largely to the fall in prices. Divided into classes, the values thus compare with those of the year 1900: Articles of food and animals, in 1900, $218,510,098; 1901, $222,227,898. Articles in a crude condition for use in domestic industry, in 1900, $302,426,748; in 1901, $269,763,404. Articles wholly or partially manufactured for use in manufactures and mechanic arts, in 1900, $88,433,548; in 1901, $79,080,716. Articles manufactured ready for consumption, in 1900, $128,900,597; in 1901, $130,662,903. Articles of voluntary use, luxuries, etc., in 1900, $111,670,094; in 1901, $120,938,095. The exports, divided into great classes, were as follows in the last two fiscal years: For ways that are dark, and tricks that are vain, the Heathen Chinee is now paying. -Chicago Record-Herald. 410,509,173 "on the face of the returns," seems considerable, and indeed the tendency for some months past has been downward. But the loss does not exceed a few million dollars. The exports of manufactures to Hawaii and Porto Rico no longer appear in the tables of foreign trade, and that fact alone accounts for a large proportion of the apparent decrease, since most of the merchandise shipped from the states to those territories is of the manufactured class. As stated above, the favorable balance was the largest recorded in our trade annals. The net balances for the past three fiscal years (including silver and gold) reach the sum of $1,745,236,489. It is further to be remembered that since 1893-the panic year every fiscal year has shown a heavy excess of exports over imports. For the eight years ended June 30 last the net balances aggregate $3,177,992,028. It is generally supposed that our current indebtedness to Europe, the annual payments for freights, interest on foreign capital, dividends, travelers' expenditures, etc., will not exceed $200,000,000. This accounts for half of the net balance. As to the other half opinions differ. Some allege that American stocks and bonds have been surrendered by Europe and acquired by our own investors in settlement of the difference. Others assert that Europe owes vast sums to American financiers and is paying interest on them. The question, "What becomes of the balance?" is under active discussion, and we shall have occasion to recur to it. A petition signed by the leading cotton manufacturers of the south, recently presented to the state department, called attention to the fact that the chief market for American cotton goods is found in the very region of China which is now disturbed, and that the cotton goods used in China are largely of the grades manufactured in southern factories which, since the beginning of the Boxer uprisings, have lost half of their trade and have been compelled to materially reduce the running time of their mills. They declare that the " open door" is necessary for them to hold their important trade with China, and they call upon the state department to take whatever action may be necessary to secure the " open door to China, and to prevent any movement by any European power calculated to close the Chinese market to our manufacturers. These facts will be new to most people, as also will be the figures here given showing the importance of this cotton trade with China to the whole country. The total exports of manufactured cotton from the United States amounted last year to but little over $20,000,000 in value. Over one-half of this went to China, and of the $10,273,000 worth of American cotton goods taken by China, almost $8,000,000 worth was taken by the three ports of North China - Tien-Tsin, New-chwang, and Chefoo all of which lie in the disturbed district. The foreign trade of these three ports amounts to about $40,000,000 per annum, being greater by far than that of all the Yang-tse river ports combined. Of these three ports, New-chwang, the port through which passes our trade with Manchuria, is by far the most important to us. It alone takes almost $6,000,000 worth of drills or sheeting, more than half our total export of cottons to China. The control which Americans hold of the cotton trade of this vast territory is shown by the report of the English consular officer stationed there. Out of 1,750,000 pieces of drills and sheetings landed at that port fewer than 50,000 pieces were of Japanese or English make, all the rest being American. The value of the cotton goods taken by this single port is more than one-third the total exports of the United States to the whole empire of China. It is apparent from this that the United States, and particularly the south, which is interested in the manufacture of cotton goods, cannot remain unconcerned at the prospect of the partition of China. Newchwang is now held by the Russians who have taken advantage of the place that Peking has held in the eyes of the world, to pour an army of 200,000 men into Manchuria, and there to wage a successful war of conquest. The agreement just published between that power and China for the government of Manchuria offers little promise that the hold which the Slav now has upon that territory will ever be relinquished unless force is used by some power like ourselves with vital interests at stake. Eastern Siberia has been a growing market for the wheat and flour produced on our Pacific coast, but such a tax has just been levied upon American flour imported into that region as completely to demoralize the trade, and the action of Russia in this case is an indication of what may be expected by us in Manchuria and those parts of China supplied through Tien-Tsin and New-chwang if they are allowed to remain under Russian control. Germany's hostile attitude toward American products is of course well known, and should she be allowed to secure her claims to the province of Shantung, a small part of whose twenty-six million we now reach through Chefoo, we may as well regard that rich market as permanently lost. Our total exports to China last year were only $15,000,000, two-thirds of which was cotton goods. Of the remainder, $4,000,000 was kerosene oil, leaving about $1,000,000 to cover other exports of every description. Our trade with China has almost been limited open door" to China, still its importance to the whole country lies in the fact that it is through our cotton goods that we are introducing other American products into that great empire. 66 MINHUI CHO, New Minister from Korea to the United States. The French parliament has passed the associations" act, which is rightly supposed to be directed against the monastic orders hostile to the republic (especially the Jesuits) and to aim at their expulsion. All the religious organizations which confine themselves to charitable and educational work will doubtless apply to the ministry for the license or grant of authority required by the law. The pope, who at first resolutely fought the act, has publicly advised the chiefs of the orders to reorganize and comply with the law. It is believed, however, that to some permission to continue their work will be refused by the government. On the whole, the Waldeck-Rousseau cabinet has succeeded beyond all expectations. As parliament is prorogued for the summer vacation, the ministry is "safe" till October, and it is worthy of note that at the end of that month it will have attained the twenty-eighth month of its existence, and will be the longest-lived cabinet in the history of the Third Republic. It was called into existence during the height of the Dreyfus agitation, which threatened civil war and a military attack upon the republic. It became known as the ministry of the Republican defense," and it enlisted the active and loyal support of the Socialists, two of whose leaders were given cabinet positions. A large number of moderate Republicans, led by Méline, the ex-premier and extreme protectionist, have opposed the ministry, and if it has survived all attacks -London Sketch. and realized nearly the whole of its program, APROPOS OF FRENCH DUELS: A HUMANE SUGGESTION. 66 |