FINANCE. An extremely heavy public debt, whose origin dates back a century and a half, and which not only shows no signs of abatement, but keeps growing from year to year; a chronic deficit in the Imperial budget; a burdensome system of taxation, which falls heaviest on the shoulders of the poorer classes of the popula tion—such is the cheerless aspect of the national finances of the country. The following figures show the budgets of Austria and during the last quarter of the century: The per capita expenditure increased in Aus tria from $7.02 in 1830 to $9.53 in 1390, and to $12.76 in 1901; while in Hungary it was *7.49, $9, and $11.53, respectively. Nearly 40 per cent. of the total expenditure of the monarchy is ab sorbed by the service of the debt; IS per cent. of Austria's expenditure and 7 per cent. of Hungary's go to the common expenditure of the monarchy, i.e. for the ministry of foreign affairs, consular services, army and navy, etc.; and about 40 per cent. of the expenditure of either country goes to general 'administrative expenses, including clerical service in all depart ments, maintenance of schools and teachers, churches and clergy, police, gendarmerie, etc. The chief source of revenue is taxation, which furnishes SS per cent. of all the income of Aus tria, and 70 per cent. of the revenue of Min gary; and in both countries the indirect taxes, i.e. those falling heaviest on the consumers, especially the poorer classes, constitute the most important item of taxation, yielding more than 60 per cent. of the entire revenue in Austria and over 40 per cent. in Hungary. The direct taxes yield 28 per cent. of the revenue of Austria and 30 per cent. of Hungary, and the income tax goes to make up about one-fourth of the direct taxes. Finally, a more important source of revenue than in most other countries are the Government monopolies and undertakings, rail ways, telegraphs, post-otlice, tobacco, forests, mines, lottery, etc., which furnish as much as 30
per cent. of all the revenue of Hungary and about S per cent. of that of Austria.
The public debt of Austria-Hungary is ex tremely large. Fully 40 per cent. of the total expenditure of the monarchy goes toward paying interest and a slight part of the principal of the debt. By the agreement of 1867, the separate debts of the two countries were consolidated into a common debt of the monarchy. In 1899 this common debt still amounted to more than $1,102,000,000. Since 1868 the new debts con tracted by the two countries have been kept distinct, and interest paid out of the separate revenues of Austria and Hungary. While the common debt has been somewhat decreased, although very slowly, the separate debts have gone on increasing from year to year, until now they have grown to tremendous proportions, prov ing a great drain on the resources of the people. In 1887 the total indebtedness of the mon archy exceeded $2,114,000,000; in 1897 it had increased to $2,723,000,000. Of this great total $26,000,000 represented the floating debt of the monarchy, consisting mostly of paper money; $1, 090,000,000 was the amount of the joint consoli dated interest-bearing debt of the monarchy; $597,935,000 represented the special Austrian debt, and $1,006,000,000 the special Hungarian debt. It should be noted in conclusion that a great part of that debt has been incurred for the purchase or construction of profitable undertak ings, such as railways, telegraphs, mines, etc.