as a clerk who compiles all the data. He is not responsible to the country for the amount he and the other departments have asked. The country does not look to him or the President for economy in the Government or for the carrying out of public improvements. Congress has the absolute power to determine how much money shall be expended. The estimates sent to Congress are referred, not to one committee who could look broadly at the proposition, but to a number of independent and separate committees. The revenue is raised by an entirely different committee, that.of ways and means. Business men and students of finance have condemned the American system. The expenditures are made with little reference to the revenues that may be collected. As legislation in America is mostly legislation by committees, the result of the financial system is that one set of men spends the money, and an entirely different set raises it. The Secretary of the Treasury and the heads of the departments, who should know the real needs of their departments and of the country at large, are not responsible to the country, for any fiscal policy that they may have. The President can do nothing, because, while he may detect extravagant items, if he vetoes at all, he will have to veto the entire bill. This he cannot very well do without stopping the whole governmental machinery.

Lord Bryce has said of the American Congressional system: "Under the system of congressional finance here described America wastes millions annually. But her wealth is so great, her revenue so elastic, that she is not sensible of the loss. She has the glorious privilege of youth, the privilege of committing errors without suffering from their consequences." 153. The English Budgetary System. In direct contrast with the American system is the English budgetary system. 1 Bryce, The American Commonwealth (new ed., 1911), vol. 1, page 184.

1

In England it is the executive, or rather the cabinet, which initiates budgetary legislation; the Parliament is a mere controlling body.

The estimates are prepared by the executive. The Chancellor of the Exchequer, or Secretary of Finance, revises all estimates of the different departments, criticizes these estimates, and even cuts them down. He has in his hands estimates of probable revenues, and therefore can harmonize the possible income and expenditures. If the other departmental heads do not agree with him as to his suggestions, the matter is brought up before the cabinet for final decision. The cabinet, at the suggestion of the exchequer, approves the fiscal budget, or plan, for the support of the Government for the coming year. Once the budget is decided upon in the cabinet, it is presented to Parliament by the Chancellor of the Exchequer. He states to Parliament the estimates of expenditures for the support of the Government and other public improvements and tells them what new taxes are necessary to carry out the plan.

Sitting as the committee on supply and the committee on ways and means, the House of Commons discusses in detail all the different estimates and the proposed revenues. The respective secretaries of departments explain to Parliament the different amounts they ask and the reason why they ask for them.

In short, the cabinet or the executive department takes the initiative in financial measures, and Parliament has only the veto power, as it were. Under the American financial system Congress takes the initiative, and the executive, through the President, has the veto power. It is just here that the fundamental difference exists between the American system and the Englhis system.

Under the English constitutional system, no appropria

tion can be voted unless the administration accepts responsibility for it by a specific recommendation. The rule of order of the House of Commons governing this matter dates back to July 11, 1713. It is now the oldest of the standing orders of the House of Commons. It runs as follows: "This house will receive no petition for any sum relating to public service,

or proceed upon any motion for a grant or charge upon the public revenue . . . unless recommended by the Crown." This rule is construed as prohibiting any motion to insert an item in an appropriation bill, or to increase any item beyond what has been asked by the government. A similar provision appears in all constitutions of British origin.

154. Essentials of a Budget. A government budget, in the proper sense of the word, is a plan for financing the government during a definite period, prepared and submitted by a responsible executive to a representative body whose approval and authorization are necessary before the plan may be executed. It is something more than an "estimate" or "statement" of financial conditions. It is a definite proposal to be approved or rejected. It should comprehend the fiscal program for the ensuing year and should exhibit at the same time the amount of revenues to be raised in accordance with the plan and the sources from which these funds are to be drawn. It should contain these details and specifications for the information of the approving body or legislature. "There must be a correlation between revenue and expenditures and between the various items of expenditures, and this information should be in the hands of the legislator with respect to every project upon which he is expected to give an opinion. Finally, a proper budgetary system involves an audit of all fiscal accounts, in order to determine with what economy previous appropriations have been spent. The preparation of the estimates, their authorization by law, and their audit comprise the cycle to be found in every efficient budgetary system." 1 155. Past Financial System in the Philippines. Nearly all struggles for constitutional government have centered on the control of the public purse. in the struggle between King John and the English barons. As a result of the struggle the Magna Carta provided that "no scutage (tenant's tax) or aid (contribution) shall be imposed except by the common council of the nation." In the American Revolution the battle cry was that taxation without representation is tyranny. That voice was reëchoed,

It was the greatest issue

1 Lowrie, The Budget, pages 12, 13.

in France when in 1789 the people's control over the revenue was declared to be one of the "prerogative laws of the state."

The Philippine Bill of 1902 provided that all appropriations must be made by law. (Sec. 5, par. 15.) This apparently gave the Philippine Assembly, established in 1907, co-equal power with the Philippine Commission on money matters. But such was not the fact. Another provision of the Philippine Bill, that in case of a deadlock on an appropriation bill the entire sum appropriated the year before shall be considered as appropriated for the ensuing year (Sec. 7, par. 3), gave the Governor-General almost dictatorial power in fiscal matters. He could. create offices in defiance of the opposition of the Legislature and coalispose in whatever way he wished of all the money of the Government so long as the entire sum did not exceed the sun ously appropriated. Thus, while other popular legislative bodies had the distinction of commanding and controlling all money bills, serving thereby as a great check on the executive, the Philippine Assembly was deprived of the function and was, as a result, a considerably weaker body than most legislative assemblies. Under the circumstances the budget system could not have been established. There was no executive responsible, or who could be made responsible, to the Filipino branch of the Legislature, and to whom the preparation of the budget could be entrusted. Nay, it was even more advantageous for the Filipino people to demand one principle of the Congressional system: the initiation of all money bills in the lower House. This demand, after a struggle with the Commission, was gained, although with no great advantage, for there being deadlocks between the two Houses on appropriation bills, the fiscal power remained practically in the hands of the Governor-General.

That there was a lack of a systematized plan in our pre