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, digs a canal, opens a road, or builds a railway, it borrows money, on which the tax-payers pay interest; that is, the government, without adding to its productive capacity, increases its active capital,—in a word, capitalizes after the manner of the proprietor of whom I have just spoken.

Now, when a governmental loan is once contracted, and the interest is once stipulated, the budget cannot be reduced. For, to accomplish that, either the capitalists must relinquish their interest, which would involve an abandonment of property; or the government must go into bankruptcy, which would be a fraudulent denial of the political principle; or it must pay the debt, which would require another loan; or it must reduce expenses, which is impossible, since the loan was contracted for the sole reason that the ordinary receipts were insufficient; or the money expended by the government must be reproductive, which requires an increase of productive capacity,—a condition excluded by our hypothesis; or, finally, the tax-payers must submit to a new tax in order to pay the debt,—an impossible thing. For, if this new tax were levied upon all citizens alike, half, or even more, of the citizens would be unable to pay it; if the rich had to bear the whole, it would be a forced contribution,—an invasion of property. Long financial experience has shown that the method of loans, though exceedingly dangerous, is much surer, more convenient, and less costly than any other method; consequently the government borrows,—that is, goes on capitalizing,—and increases the budget.

Then, a budget, instead of ever diminishing, must necessarily and continually increase. It is astonishing that the economists, with all their learning, have failed to perceive a fact so simple and so evident. If they have perceived it, why have they neglected to condemn it?