﻿WAR BORROWING

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THE PAST

A careful historian of financial thought has lately
declared that there are few economic questions upon
which opinion has been so divided and for so long a
time as the best method of raising funds for the
conduct of war.1 For two centuries and a half
statesmen and economists have debated as to
whether in time of war all supplies should be raised
by taxation or some reliance should be had upon
public credit. In the present war this controversy
has been waged with new intensity but with old-time
uncertainty. In so far as settlement has been
reached as to the adjustment of war expenditure be-
tween taxes and loans, the formula has been oppor-
tunist rather than definitive.

Curiously enough, the discussion,2 spirited and

1	In W. R. Scott’s admirable address to the Economic
Science Section of the Royal Philosophical Society of Glas-
gow on “Adjustment of War Expenditure between Taxes
and Loans” (Glasgow, 1917); reprinted in the same author’s
“Economic Problems of Peace after War: Second Series”
(Cambridge, 1918).

2	See, for example, “ Financing the War,” a series of papers
if1 The Annals of the American Academy of Political and
Social Science, January, 1918; also “Financial Mobilization

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