The end and object of all production is consumption; for why should men exert bodily toil or mental care in producing, except for the gratification afforded by consuming, or using what had been produced. His productive industry has, therefore, always been conducted with a view to this result. Thus, let us look to the production of a loaf of bread. After the land has been cleared of its timber, or other spontaneous growth, it must be broken up by the plough or the spade. It must then be sowed with the seed sought to be multiplied - say wheat, and harrowed. It germinates, grows, and finally ripens, when it is reaped by one instrument or machine; threshed out by another, and winnowed by a third. It is then carried to the mill, where it is first ground into flour, which is separated into two or three kinds, and all of them from the bran. The flour is carried to the baker, who, by a process, partly mechanical and partly chemical, makes it into dough, kneads and bakes it, when it becomes one of the most common articles of human subsistence.

In like manner of a beef-steak. The ox from which it was taken was probably reared in a region where the natural herbage was abundant. He was thence transported to a distance, where he was purchased and fattened for the shambles. He was then killed by the butcher, who distributed his flesh, hide, hair, tallow, feet, bones, and horns to different sets of customers, for their several purposes, and one of the most savory portions of his meat was conveyed to the cook, who converted it into a steak. And so with every object of apparel, from a hat to a shoe, or of household furniture, from a grand piano to a kitchen-fork.

Of the immense multitude of articles thus annually produced for man's necessities or gratification, the whole is consumed in about the same time that it has been produced, with the exception of a small portion, - about five or six per cent., - which gradually adds to the wealth of the community.

This consumption, however, is not made altogether by the individuals who were the producers; but a considerable portion is made by the community, in its aggregate character - that is, by the Government. This distribution is very different in different countries; and as a general rule, the larger the share which is received by individuals, and the smaller that received by the Government, the happier and freer are the people.

The better to understand how the portion consumed by the Government is separated from the whole amount annually produced and disbursed, let us advert to the distribution of political power.

In all well-organized governments, the power of the state is, by its fundamental principles, or constitution, divided between the legislature, the executive, and the judiciary. The legislature determines its own ordinary functions, as well as those of the executive and judiciary. It controls the conduct of individuals when the public good requires it, enjoining some acts, and prohibiting others. It provides for the national defence, by sea and land. It maintains a friendly diplomatic intercourse with foreign nations. It establishes courts to administer justice and to punish crimes, prescribes the rules of property and of civil rights, and lastly, it provides an adequate revenue, which is disbursed in the modes and according to the rules it has prescribed.

The executive has the power of appointing all officers, civil, military, or naval. By these it defends the country against foreign enemies or domestic insurrection, collects and disburses the public revenue, and executes the judgments of the courts, both civil and criminal.

The judiciary, however, tries all public offenders, and sentences them to punishment. It settles all disputes between individuals about property, enforces contracts, maintains rights, whether derived from law or custom, and decides all questions by settled rules of evidence, and in accordance with the behests of law and the principles of justice.

To enable the Government to perform these high and important duties, the legislature must provide an adequate revenue, which is sometimes derived in part from the profits or sales of public property, but mainly from taxes, the principles of which we will now consider; premising that, inasmuch as by far the larger part of every community spend on themselves and their families all their earnings, this subject of taxation is a very important one, as respects both the productiveness of the tax and the interest of the people.

According to Adam Smith, whose views on this subject have been generally approved, taxes ought to conform to the four following maxims:

1. Every citizen ought to contribute to the public revenue in proportion to his ability. It is sheer justice that be who has the largest amount of property protected should pay the most for that protection.

2. The tax which each person is required to pay should be certain, both as to the amount, the time, and the mode of payment; so as to leave as little discretion as possible to the tax-gatherer. The uncertainty of a tax is severely felt by the payer, as it prevents preparation, or makes it unavailing, though it may add nothing to the revenue.

3. Every tax ought to be levied at the time and in the mode which is most convenient to the payer.

A tax, for example, on articles as consumpted, may be very little felt, while the same tax, collected at once, might be oppressive, and perhaps impracticable.

4. A tax should take out, and keep out, of the pocket of the payer, as little as possible beyond what it brings into the public treasury. Thus, a tax may pass through several successive hands, each of whom, receiving his compensation proportionally, deducts from the proceeds of the tax. It may, by prohibiting or discouraging particular branches of industry, render many persons less able to pay the tax. It may, by encouraging smuggling, and evasions of the tax, render it less productive. It may tax the time as well as the purses of the citizens. And lastly, it may subject the citizen to the interruption and vexation of domiciliary visits and inquisition.

Taxes are sometimes used for other purposes than revenue. When laid on what are regarded as nuisances, they are meant to be prohibitions, and, when they fail in this object, to make to the public some compensation for the failure. Of this character are taxes on gaming and drinking-houses, or lotteries.

They are also meant, by discouraging one branch of industry, to encourage another: as where a tax is laid on certain fabrics received from abroad by the exchanges of commerce, for the sake of encouraging the domestic producer of similar articles, on whose industry the tax operates as a bounty.

The preceding views will be illustrated by a separate notice of the taxes which are principally resorted to for revenue.