interfere with our pious benevolence, and how shrewdly they meet the danger of the natural disappearance of the veteran and the mechanical extinction of the tax.

It is now forty-seven years since General Lee surrendered at Appomattox Court House. One year later the Government was distributing $15,450,000 in pensions. This year, half a century later, the Government is distributing $183,780,000. By far the greater part of those who went to the war are dead; wounds and disease incurred in the service have either healed or done their work long since; widows long since have joined the husbands they mourned, and dependent orphans have become grandparents. But the pension bill keeps going up. Pensioners depart, but the pension bill is with us forever. The objects of our solicitude pass beyond its reach, but Congress creates new ones for us, and gives them bigger stipends. The processes of time must not be suffered to waste or lessen the pension bill; politicians and claim agents watch it with tender interest; no sooner does it betray a tendency to decrease than they rush to its aid with restoratives devised to create new classes of beneficiaries, to augment the rates of payment, and do away with the need of proofs.

Look at the diagram, and you will notice that after the close of the war the expenditure for pensions increased, attained its natural maximum in eight years, and began a natural decline. The decline would have continued — had not the pension-agents (by this time developed into a shrewd and powerful body at Washington) succeeded in persuading the politicians that a big, permanent pension fund could be used with tremendous effect in political work. Incidentally, the promoters of the "protective" tariff idea realized that to pay a big pension bill a high tariff would be a necessity, and that every pensioner would be an interested advocate of a higher and ever higher tariff. In 1878 began a systematic, artificial stimulation of pension legislation. It has continued ever since. The Arrears Act of 1878 instantly doubled the bill- and gave the first opening to fraud. There has followed, whenever it was needed,

some new Act to boost pension payments. Notice, though, in the diagram, that in 1893 the index line suddenly drops. That was the year Grover Cleveland came in for his second term and started investigation of pension frauds. They were continued by McKinley's honest Commissioner, H. Clay Evans. Despite all that the politicians and the pension agents could do for it, the expenditure continued about even until 1907. That year the Republican Congress, under the spur of an approaching election, passed a series of pension promoters, notably the Age Act. The bill ran to 153 millions in 1908, and 162 millions in 1909. Look at the diagram, and you will see that in the last two years the index line has fallen - not much, but still fallen down to 162 millions in 1911, and 158 millions last year. It was clearly time to do something, especially as another election was coming

on.

-

Congress has done something. It has passed, and President Taft has signed, a "Service Pension" Act of much ingenuity, calculated to raise the pension-tax by about 25 millions of dollars- $25,797,702, according to the estimate of the Pension Bureau. This is the biggest single raise ever made. Half a century after Appomattox it adds to the already enormous expenditure in pensions a sum equal to the total amount paid in 1868 to the real deserving and needy heroes of the war. How much more it will add next year and the next we are not told, but doubtless the annual increase during the next decade will be gratifying; the 200 million mark ought easily to be passed next year, when we shall be paying out annually for an army that long ago ceased to exist double what it costs to support the largest existing army in the world - that of Germany.

It is a supererogatory virtue of the new law that it very largely increases the operating cost of the Bureau- this will now be between three and four millions.

To raise the 185 millions of dollars which pensions will cost this year, the Government will allow every man, woman, and child in the United States to contribute a two dollar bill. Every head of a household

chips in twenty cents a week - ten dollars a year. This is pure disinterested charity! What a source of satisfaction it ought to be to each of us to remember that we are not selecting the objects of our gifts! They are named for us by politicians and bureau officials; in fact, pretty much anybody who wants a pension and is willing to make a few affidavits can have one, and the list includes a prodigious number of perjurers, forgers, campfollowers, deserters, and bogus widows. What a satisfaction it ought to be for us to remember that it is no longer even pretended that pensions are given only to patriots who deserve and need them! Under the law any one who spent 90 days in the recruiting camp now gets a pension, whether he needs it or not. It was proposed to refuse to give to those who already had an income of $2,400 a year, but the pusillanimous suggestion was rejected; 9,000 pensioners have confessed to the Bureau that they have a greater income than that (some are millionaires), but it would cost more in clerk hire to go into this than it would to pass out the money. What does any American family that pays its $10 tax into the pension fund care where the money goes?- care whether the recipient or the contributor needs it more?

A

HUNGRY ENGLAND AND

SOCIALISM

N AUSTRALIAN journalist in London discovered the horrors of the East End. At least he thought he discovered them, for he saw no mention of them in the daily press. He planned a series of articles that would stir London. Surely the people in the clubs on Piccadilly and the residents of Mayfair and Kensington were ignorant of the horrors of Whitechapel and Poplar! He would tell of the homes that were without fires when the thermometer was five degrees above zero; of the starving children who ran barefoot, their little toes raw with the cold; of the gaunt men who, failing in their search for work, sang "Britons never shall be slaves" as they begged for pennies through the streets!

The articles were powerful examples of the muckraker's art. The Australian carried them to the editor of a morning paper and sat expectantly while the Englishman glanced over sheet after sheet. The editor became excited. Finally he flung the articles upon the floor and turned upon the writer.

"Englishmen don't want to hear of this!" he cried fiercely. "No, sir! And British papers do not want to publish it! We know that this poverty exists, but England has been Merrie England for ten centuries and by the grace of God we'll keep it so!"

Nevertheless, Socialists have come nearer realizing their dreams in England than they have in any other European country; and Socialism is everywhere the instrument through which poverty and discontent make their protests heard. The audience that the British press denied them, the Socialists have found upon the stump; and they have proved to this audience that the boast of a happy England is a sorry sham. Their indictment of conditions as they are has brought about a revolution in the membership of the House of Commons so that government by "gentlemen" has given way to government by laboring men. A Socialist and labor leader, John Burns, is a member of the Cabinet; and the dominating personality in the present British Government is Lloyd George, who calls himself a Radical but who is to all intents a practical Socialist.

These are changes that completely alter the principles upon which legislation is made in England. The great Cabinet crises now arise not over questions of trade but over bills to effect a more equable distribution of taxes or the betterment of working conditions in the great industries. Mr. Samuel P. Orth, elsewhere in this magazine, shows how far England has drifted from the idyllic peace and feudal ideals of government of the "Merrie England" of sentimental retrospect. Indeed, he himself suggested the title, "The Land of Fulfilment," that appears over the article, after he had made a careful study of the advance of Socialism in France, Germany, Belgium, and England.

As he aptly says, "England has awakened hungry," and the answer to its cry is the threat of complete Socialistic domination.

THE BEST WORK OF OUR TIME

T

HE stimulus to the upbuilding of farm-life that is to be given by the financial help of Messrs. Sears, Roebuck & Co., of Chicago, to the extent of $1,000,000 is a most excellent deed in itself, but it is also a suggestive indication of the advanced stage which this movement has reached. Bankers also in many parts of the country are giving their help, and boards of trade in many cities and towns. There is no other genuine and fundamental movement in American life comparable in its earnestness to this many-sided effort to build up country life.

The work provided for by Messrs Sears, Roebuck & Co. is in the main, "farmdemonstration" work- the method of instructing the farmer on his own land, which Dr. Seaman A. Knapp worked out so helpfully in the Southern States. The same method is to be used, under the direction of the Department of Agriculture, now also in some of the Northern and Western states. It was a great discovery (for it is worthy to be called a discovery) that the most direct way to improve agriculture is to send teachers to the farmers. It seems absurdly simple. But it has already proved to be the most important economic force in the postbellum history of the Southern States.

The General Education Board which has for many years given very substantial help to the farm-demonstration work in the Southern States has now begun another attack on the problem of building up country life. The rural school in most parts of the country is feeble and unfit at once a result and a cause of inefficiency. This Board has quietly and conservatively begun the building-up of a certain number of country public schools in strategic places to do the tasks that the country schools of the future must do, schools which shall not only teach children what they must know, by right methods, but that shall be living and organizing and stimulating institutions for all the people

in their communities. This Board has also given $250,000 toward the endowment of a School of Country Life in the George Peabody College for Teachers, at Nashville, Tenn., where men and women will be trained to make the right kind of country schools.

Mr. Montfiore G. Kahn, of New York, has munificently provided for the beginning of work upon another phase of the landward movement by his gift of the perpetual use of 13,000 acres in New Jersey to be let, rent free, in ten acre lots, to immigrants who come from foreign rural communities. To describe such plans of work in merely general terms is not easy without apparent exaggeration. But this is a conservative statement: during the noises of our time-the noises of politics, of finance, of big business, of labor - which attract and distract us, there is no other work going on in our country comparable in its constructive value to such welldirected efforts as these to make country life what it ought to be and what it will become the nursery of the nation.

TO GIVE CREDIT WHERE IT IS DUE

HERE are good farmers in the United States paying 10 per cent. interest on mortgages upon their farms of 200 or 300 acres. The holder of the mortgage can ask that it be paid off at any time upon notice. Beyond this the farmer has practically no credit facilities unless it be a crop mortgage at a ruinous rate.

In contrast to this, in Germany, Ireland, and Denmark there are farmers with only a few acres and but a small income who can borrow money upon their notes at 4 per cent. for any legitimate farm use even if they are tenants and not landowners. And men with land can mortgage it at a low rate and the mortgage can not be terminated until they wish it.

Our system almost ignores the individual farmer and it cripples his operations by denial of credit as the operations of any other manufacturer are crippled when credit is withheld. In some parts of the United States mortgages may be had on good terms, but there are many places

where farmers cannot get mortgage loans even on good securities. In America the making of a mortgage loan is essentially a local transaction and it will be so until Americans have also established institutions to issue bonds instead of individual mortgages. American farm mortgages are not available securities in the sense in which railroad bonds are available, nevertheless the average mortgage security is greater than the security of railroad bonds. When we consider the low rate of interest paid on railroad bonds, municipal bonds, etc., there is no reason to doubt that mortgage bonds by proper methods would have similar results. That is what has come about in Europe.

A hundred and fifty years ago in Germany the same conditions existed except that the situation was more acute. The Seven Years' War was just over. Buildings were in ruins and farm equipment was destroyed. Money for improvements, Money for improvements, tools, and implements was necessary. That situation created the Landschaft, an association made up of the farmers themselves who issue bonds secured by the credit of all the members and lend the money from the sale of the bonds upon mortgage at a low interest to such members as need it; and the mortgage continues until the borrower wishes to pay it off. For a century and a half the Landschaften have given the German farmer a credit that the American farmer lacks, and needs. In all that time the members of the various Landschaften have never been called upon even to help pay the interest on the bonds, for the interest on the mortgages has never failed; and in that time, though now and then the bonds have depreciated in value, they have, as a rule, been as steady as Government securities. Something like $600,000,000 is invested in these Landschaft bonds at present, to the vast benefit of German agriculture.

II

But the mortgage on the farm corresponds only to the bonds of a manufacturing company. For its working capital, the manufacturing company applies to the banks. Its affairs are fairly large,

its business known, and its credit good. It can borrow money upon its notes. But the farmer can not. He has generally to provide his working capital himself, or go without. If his farm is already mortgaged and he needs a dozen or so head of stock, or money to tile drain or to use for any other proper purpose that will make the farm more profitable, he has no sure source from which to get that money. Our credit system does not supply it.

Abroad, the coöperative bank provides this much needed credit. In principle it resembles the Landschaft- a number of farmers in a district form themselves into an association. Every member assumes unlimited liability for the debts of the association. The credit of the association is not based upon land, as it is in the Landschaft, but upon the earning power of its members. This has been sufficient to raise whatever sums have been necessary. Moreover, none of these banks have failed or had to call upon the members to pay liabilities. As every member is liable for all the debts, candidates for membership are carefully scrutinized and the work of the officers is constantly watched. As the loans made by the coöperative banks are secured only by the notes of the borrower, the banks demand to know that the money is borrowed for some legitimate farm use and that it is used for that purpose. And these loans are like the Landschaft mortgages - long time loans and not subject to call.

In other words, in the United States the farmer has no certain place to get money by mortgaging his farm. He must find some local capitalist willing to lend him the money, and often he will have to pay a high rate. If his farm is mortgaged, his ability to raise money for proper and necessary running expenses and improvements amounts practically to nothing. If a farmer lacking the ready cash should wish to buy a traction engine that would be a good investment for him, he can not get money at a low rate to buy it. He buys it "on time." The manufacturer is lending him the money and the manufacturer cannot afford to do it cheaply. So it goes; from beginning to end our greatest industry