330 THE FISCAL PROBLEM IN MISSOURI 
A comparison of the net state expenditures of Missouri 
with those of eleven other states in the same section indicates 
that during the period 1923 through 1928 only Minnesota, 
[llinots, and Ohio had expenditures greater than Missouri. 
In relation to net total expenditures Missouri expended less 
for maintenance purposes than any other state used for com- 
parative purposes. Highways accounted for a larger propor- 
tion of total state expenditures in Missouri than in any of the 
eleven states. Since highway expenditures in Missouri were 
predominantly for capital purposes, the low proportion for 
maintenance is attributable largely to the highway function. 
[t is estimated that the gross expenditures of all local 
governments in Missouri amount to $163.6 million for the 
fiscal year ended in 1928. Of this amount the four largest 
cities, including school and other special districts therein, 
accounted for $90.6 million.! Education and highways are 
the most important local governmental functions, judged 
from the standpoint of the volume of expenditures. 
State AND LocaL INDEBTEDNESS 
The history of state indebtedness in Missouri may be 
logically divided into four periods. During the first period 
there was no state debt of significant size at any time. The 
second period, which began soon after the middle of the 
nineteenth century, was marked by borrowing for internal 
improvements, particularly for railroad development. The 
third period was characterized by a conservative policy, in 
accordance with which the indebtedness incurred for internal 
improvements was liquidated. In the fourth and present 
period, Missouri has taken a more liberal attitude toward 
state borrowing. The constitutional limitations on the bor- 
rowing power of the state government, imposed in 1875 when 
the present state constitution was adopted, were amended in 
1920, in order that funds mightbe obtained through borrow- 
ing for highway purposes and for the payment of a soldiers’ 
bonus. In 1922 the state began to borrow on a large scale, 
and the net bonded debt of the state increased from $0.70 
per capita in 1918 to $7.96 per capita in 1923 and $17.98 per 
1 Exclusive of payments for debt redemption.