substantial vitality which is the essential object sought in this straining after an "independent" standing.

Hence we see what we see during these latest times;— that the advance of research and the profounder insight gained by employment of the latest methods are upsetting the fancied independence of whole groups of these special sciences and replacing it with a comprehensive relation of dependence. This is what modern Natural Science teaches, when the traditional boundary lines of Medicine, Botany, Zoology, etc., have to be readjusted after every new step in advance, when Chemistry and Physics draw closer together as the potent force of sweeping generalizations based on the great mass of material furnished by research comes to the front.

Something similar, though hampered by the difficulties inherent in a complex subject matter, is to be remarked in the case of our own science. There is no contradiction in the fact it is rather the fruit of an improved method of research-that the latest developments of our science have been characterized on the one hand by an affectionate attention to the historical material bearing on economic life, and on the other hand-and at the same time by a broader and more comprehensive view of the nature of all economy. An attempt has been made in the first volume of the present work to form an estimate of the value of this evolution, and, so far as in me lies, to contribute something towards its furtherance. We shall simply be continuing the work on the same line in doing the like for the Science of Finance and placing to its credit what has been accomplished for the science. Just as Political Economy has been traced back to its deeper-lying sources, and has therewith been advanced beyond its narrow traditional limits, so also the science of finance may claim the like within its field after its achievements have likewise been assimilated into the body of the profounder conceptions of all social life.

4. That the Science of Finance is a part of Political Economy is a long-accepted fact.

There is an objection of a trivial character that may be raised at this point, an objection based on the varying meaning attached to the term "Political Economy." Since the term has been applied now to economic science as a whole, now to the fundamental (general) part of the science only, it has not rarely happened that the Science of Finance and Political Economy have been contrasted with one another as parts of a greater whole. The like was done more intentionally and consciously by K. H. Rau and his contemporaries and followers when they contrasted the Science of Finance with Economic Science [Volkswirthschaftslehre]. Indeed, the contrasting of the two was in this case the result of a well-defined purpose, and was consistently adhered to; Economic Science as a whole being designated "Political Economy" [Politische Oekonomie] (similarly of late in the Handbuch der politischen Oekonomie of Gustav Schönberg, 1882; 3. ed., 1890-91). The aim was to call attention to the difference between an ostensible "pure theory" and its application in the practical working of political affairs.

Neither a purpose of this kind nor the varying usage of the terminology must, in view of the conclusions reached in the first volume of the present work, be allowed to mar the simplicity of the relation in virtue of which we have here to do with a general and a particular, a whole and its parts;-with parts, of which the Science of Finance is one; with a whole, which is Political Economy. For everything contained in the discussions that follow is but a more detailed elaboration of the general outlines that have already been laid down in the first volume.

This view corresponds in the main with the views held at the time when an independent science of economic life first made its appearance. Even the creators of the new science, the Physiocrats,' made the theory of taxation the corner-stone of their theory of economy, and so incorporated the Science of Finance indissolubly into the structure of the system. Adam Smith devotes the fifth book of his Inquiry into the Wealth of Nations to The Revenue of the Sovereign or Commonwealth, and English manuals

have to this day followed the tradition initiated by him. So John Stuart Mill, in his Principles of Political Economy, likewise devotes his fifth and last book to the same subject, and he even unmistakably follows Adam Smith in his arrangement of details, only he introduces discussions of a general character on the influence of the government upon industry. A separation of the part from the whole has not hitherto been attempted in England, for the reason that the slightness of the subsidiary structure has offered no temptation to a claim of independence. There has also been no work, worth mentioning, which treats separately of this subject.'

§ 5. The place of Financial Science in the general science of Political Economy has also been questioned on other grounds.

A treatment of the subject that makes the distinction between "Social Sciences" and the "Political Sciences" its point of departure relegates Political Economy to the former head, the Science of Finance to the latter. My opinion regarding the contrasting of these two great groups of sciences has been expressed in the proper place (vol. i. sec. 54). Among the consequences of making this distinction would be that the treatment of private law would come under the general head of the social sciences, and that of administrative and public law generally under the head of the political sciences, a separation of things that belong together such as is manifestly untenable when we consider that precisely the latest advance in jurisprudence goes to show the impossibility of drawing any line between so-called private law and so-called administrative law. In like manner the latest progress of Economic Science places the state in such intimate relation to the factors of the social economy that any classification of the subject matter to be dealt with which places the State in contrast with Society becomes no less false in theory than it is in actual life. Such a distinction would be tenable only in case we had a science of the instinctive movements and activities

'C. F. Bastable's Public Finance (1892) has been published since this was written. [TR.]

of society (such as Sociology actually claims is possible), which could then be contrasted with the ethical "ought" as applied to the state. This question, however, has been so fully discussed in the general portion of the present work as to leave nothing more to be said about it at this point.

A much nearer approach to the real facts of the case is made in the observation that when the matter is viewed from the standpoint of the national administration we find ourselves confronted with a special phase of social life and a special problem, which require that the science should be treated as a political science in the narrower sense, and that hence arises a group of political sciences, in the narrower sense, which treat of the various phases of the political range of activities. But even if this be granted, a useful purpose will be served by this classification only in so far as the special science takes up a special subject matter for scientific treatment; so that the political sciences, in this narrower sense, will accordingly have to take up the particular institutions that go to constitute the state and through which the state acts. It then becomes a question between these "political" sciences and the other special sciences, how far the latter are to be deprived of their substance for the benefit of the former. It results that a theory of the State, of the Constitution, of Administration, may be developed up to a given point out of the principles special to the State as such; while beyond this point we pass to ground where these principles alone will no longer serve our purpose, and where recourse must be had to knowledge drawn from elsewhere. It is at this point that Jurisprudence, Economic Science, and Natural Science come in and demand recognition, the one or the other of them, according to the particular sphere of political activity under consider

ation.

The like is true of the Science of Finance. We may approach the public economy from the summit of the political structure as well as from the lower-lying fields of the economic life of the people. But the knowledge required in order to a scientific treatment of the public economy remains the same, and it

depends, in a greatly preponderating degree, on an understanding of what goes to make up the economic life of the people.

If, now, both these avenues of approach are open to us, the logic of our method decides us in favor of the one which affords the more vital connection between the fundamental elements of the problem.

II. THE RELATION OF THE SCIENCE OF FINANCE TO

POLITICAL ECONOMY.

§ 6. A few words will be necessary to justify the classification

here insisted on.

In the Introduction to the general doctrine of Political Economy contained in the first volume of the present work, it is attempted to lead up to the general body of the science by means of the following named chapters: An Exposition of the Scientific Method necessary to the Attainment of Truth in our Branch of Knowledge, The Relation of Political Economy to the other Sciences, The Historical Development of the Body of Doctrines, Fundamental Concepts.

The unity of part and whole-of the Science of Finance with Political Economy-has been so fully pointed out in the Doctrine of Method that there is no need of repeating here, in connection with this special point, what has already been said in discussing the general subject. It may therefore be sufficient simply to refer back to the earlier discussion. The meaning and import of the general principles, set forth after the fashion of the old school of thought; the relation of deduction to induction, of hypothesis to empirical knowledge; and more especially the value of financial history and financial statistics for the purposes of the Science of Finance;-all this could be intelligibly discussed only with the aid of appropriate illustrations, and bearing in mind what has already been said in the general portion of the work. But this would necessitate a great deal of repetition, which will best be avoided by simply referring back to the general introduction for the whole matter.