Page:American Journal of Sociology Volume 8.djvu/62

 THE AMERICAN JOURNAL OF SOCIOLOGY

that we lost the good results achieved in 1876, and were thrown into a condition of financial instability. Our motive was a high and noble one. We wanted to make up for lost time in the great race for progress : we were anxious to become in fact, not in word only, a great power, taking our part in the work of civilization ; but we were hasty and impulsive, we lost sight of reality, and did not think of proportioning our efforts to our actual possibilities. Hence we built railroads and rebuilt cities, and threw the burden of the expense upon the labile structure of public debt.

Since the latest crisis, the watchword of our financial policy has been the most rigid enforcement of the rule : no more debts. We have come out of the struggle with a clearer head and a keener sense of reality.

The good results of such a change of methods were not slow in manifesting themselves. Since 1897 the surplus has not only been constant, but it has shown a steady increase. We had :

1897-1898.

1898-1899.

1899-1900.

1900-1901.

Receipts (million francs). . . Expenditures "

1,629.4 1,620.0

1,658.8 1,626.1

1,671.5 1,633-1

1,751.8 1,710.6

+9-4

+32.6

+38.4

+41.2

So far we have been considering only the actual receipts and expenditures of the kingdom, as the basis for our discussion of its financial situation. It is a fact that the kernel or soul, as it were, of every public budget lies in the relation that expenditure bears to receipt. But in order to get a comprehensive view of all the factors involved in the question, we have also to take into account the remarkable rise in the market quotation of government bonds a striking feature of the present financial situation of Italy. This may be due in part to the great popu- larity enjoyed of late years by state bonds at large as a safer investment than industrial bonds. But the increase would have been neither so rapid nor so high, had it not been for the healthy condition of the budget shown above. The price of the Italian 5 per cent, consols on the Paris market had dropped to 72 in