The Essential Writings of President Woodrow Wilson. Woodrow Wilson
revenue for the ensuing year, upon the hypothesis that taxation will remain unchanged."
Having with such aids made up his budget, the Chancellor goes before the Committee of Ways and Means prepared to give a clear history of the financial administration of the year just closed, and to submit definite plans for adjusting the taxation and providing for the expected outlays of the year just opening. The precedents of a wise policy of long standing forbid his proposing to raise any greater revenue than is absolutely necessary for the support of the government and the maintenance of the public credit. He therefore never asks the Committee to lay taxes which promise a considerable surplus. He seeks to obtain only such an over-plus of income as will secure the government against those slight errors of underestimation of probable expenses or of overestimation of probable revenue as the most prudent of administrations is liable to make. If the estimated revenue considerably exceed the estimated expenses, he proposes such remissions of taxation as will bring the balance as near equality as prudence will permit; if the anticipated expenses run beyond the figure of the hoped-for revenue, he asks that certain new taxes be laid, or that certain existing taxes be increased; if the balance between the two sides of the forecast account shows a pretty near approach to equilibrium, so the scale of revenue be but a little the heavier of the two, he contents himself with suggesting such a readjustment of existing taxes as will be likely to distribute the burden of taxation more equitably amongst the tax-paying classes, or facilitate hampered collections by simplifying the complex methods of assessment and imposition.
Such is the budget statement to which the House of Commons listens in Committee of Ways and Means. This Committee may deal with the proposals of the Chancellor of the Exchequer with somewhat freer hand than the Committee of Supply may use in passing upon the estimates. The Ministry is not so stiffly insistent upon having its budget sanctioned as it is upon having its proposed expenditures approved. It is understood to pledge itself to ask for no more money than it honestly needs; but it simply advises with the House as to the best way of raising that money. It is punctiliously particular about being supplied with the funds it asks for, but not quite so exacting as to the ways and means of supply. Still, no Ministry can stand if the budget be rejected out of hand, or if its demands for the means of meeting a deficiency be met with a flat refusal, no alternative means being suggested by the Opposition. Such votes would be distinct declarations of a want of confidence in the Ministry, and would of course force them to resign.
The Committee of Ways and Means, then, carries out, under the guidance of the Chancellor of the Exchequer, the resolutions of the Committee of Supply. The votes of the latter Committee, authorizing the expenditures mapped out in the estimates, are embodied in "a resolution proposed in Committee of Ways and Means for a general grant out of the Consolidated Fund 'towards making good the supply granted to Her Majesty;'" and that resolution, in order that it may be prepared for the consideration of the House of Lords and the Crown, is afterwards cast by the House into the form of a Bill, which passes through the regular stages and in due course becomes law. The proposals of the Chancellor of the Exchequer with reference to changes in taxation are in like manner embodied in resolutions in Committee of Ways and Means, and subsequently, upon the report of the Committee, passed by the House in the shape of Bills, "Ways and Means Bills" generally pass the Lords without trouble. The absolute control of the Commons over the subjects of revenue and supply has been so long established that the upper House would not now dream of disputing it; and as the power of the Lords is simply a privilege to accept or reject a money bill as a whole, including no right to amend, the peers are wont to let such bills go through without much scrutiny.
But so far I have spoken only of that part of parliament's control of the finances which concerns the future. The "Ways and Means Bills" provide for coming expenses and a prospective revenue. Past expenses are supervised in a different way. There is a double process of audit by means of a special Audit Department of the Civil Service, which is, of course, a part of the permanent organization of the administration, having it in charge "to examine the accounts and vouchers of the entire expenditure," and a special committee nominated each year by the House "to audit the Audit Department." This committee is usually made up of the most experienced business men in the Commons, and before it "all the accounts of the completed financial year are passed in review." "Minute inquiries are occasionally made by it into the reasons why certain items of expenditure have occurred; it discusses claims for compensation, grants, and special disbursements, in addition to the ordinary outgoings of the department, mainly, to be sure, upon the information and advice of the departments themselves, but still with a certain independence of view and judgment which must be valuable."
The strictness and explicitness with which the public accounts are kept of course greatly facilitate the process of audit. The balance which is struck on the thirty-first of every March is of the most definite sort. It deals only with the actual receipts and disbursements of the completed fiscal year. At that date all unexpended credits lapse. If the expenditure of certain sums has been sanctioned by parliamentary vote, but some of the granted moneys remain undrawn when April comes in, they can be used only after a regrant by the Commons. There are, therefore, no unclosed accounts to obscure the view of the auditing authorities. Taxes and credits have the same definite period, and there are no arrears or unexpended balances to confuse the book-keeping. The great advantages of such a system in the way of checking extravagances which would otherwise be possible, may be seen by comparing it with the system in vogue in France, in whose national balance-sheet "arrears of taxes in one year overlap with those of other years," and "credits old jostle credits new," so that it is said to be "always three or four years before the nation can know what the definitive expenditure of a given year is."
For the completion of this sketch of financial administration under the Commons it is of course necessary to add a very distinct statement of what I may call the accessibility of the financial officers of the government. They are always present to be questioned. The Treasury department is, as becomes its importance, exceptionally well represented in the House. The Chancellor of the Exchequer, the working chief of the department, is invariably a member of the Commons, "and can be called to account by interrogation or motion with respect to all matters of Treasury concern"—with respect, that is, to well-nigh "the whole sphere of the discipline and economy of the Executive Government;" for the Treasury has wide powers of supervision over the other departments in all matters which may in any way involve an outlay of public money. "And not only does the invariable presence of the Chancellor of the Exchequer in the House of Commons make the representation of that department peculiarly direct, but, through the Secretary of the Treasury, and, with respect to certain departmental matters, through the Junior Lords, the House possesses peculiar facilities for ascertaining and expressing its opinion upon the details of Treasury administration." It has its responsible servants always before it, and can obtain what glimpses it pleases into the inner workings of the departments which it wishes to control.
It is just at this point that our own system of financial administration differs most essentially from the systems of England, of the Continent, and of the British colonial possessions. Congress does not come into direct contact with the financial officers of the government. Executive and legislature are separated by a hard and fast line, which sets them apart in what was meant to be independence, but has come to amount to isolation. Correspondence between them is carried on by means of written communications, which, like all formal writings, are vague, or by means of private examinations of officials in committee-rooms to which the whole House cannot be audience. No one who has read official documents needs to be told how easy it is to conceal the essential truth under the apparently candid and all-disclosing phrases of a voluminous and particularizing report; how different those answers are which are given with the pen from a private office from those which are given with the tongue when the speaker is looking an assembly in the face. It is sufficiently plain, too, that resolutions which call upon officials to give testimony before a committee are a much clumsier and less efficient means of eliciting information than is a running fire of questions addressed to ministers who are always in their places in the House to reply publicly to all interrogations. It is reasonable to conclude, therefore, that the House of Representatives is much less intimately acquainted with the details of federal Treasury airs than is such a body as the House of Commons, with the particulars of management in the Treasury which it oversees by direct and constant communication with the chief Treasury officials.
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