Doles. Throwing the confiscated money into nationalized banks. Raising wages in confiscated industries. War. Would these act quickly enough? An uninterrupted circulation of money is as necessary to a nation as an uninterrupted circulation of blood to an animal. Any general and simultaneous confiscation of income would produce congestion in London. Grants-in-aid to municipalities an important safety valve. Public works. Roads, forests, water power, reclamation of land from the sea, garden cities. Examination of these activities shews that none of them would act quickly enough. They would provoke a violent reaction which would give a serious set-back to Socialism. Nationalizations must be effected one at a time, and be compensated. 279 62 WHY CONFISCATION HAS SUCCEEDED HITHERTO Direct confiscation of income without compensation is already in vigorous operation. Income tax, super tax, and estate duties. The Chancellor of the Exchequer and his budget. Gladstone’s attitude towards income tax. General agreement of Capitalist parties that all other means of raising money shall be exhausted before levying taxes on income. Contrary assumption of the proletarian Labor Party that the Capitalists should pay first, not last. This issue underlies all the Budget debates. Estate duties (“death duties”), though unsound economically, and often cruel and unfair in operation, succeed in carrying Socialistic confiscation further in England under Conservative Governments than some avowedly Socialistic ones have been able to carry it abroad. The success of the operation is due to the fact that the sums confiscated, though charged as percentages on capital values, can be paid out of income directly or indirectly (by insuring or borrowing), and are immediately thrown back into circulation by Government expenditure. Thus income can be safely confiscated if immediately redistributed; but the basic rule remains that the Government must not confiscate more than it can spend productively. This is the Socialist canon of taxation. 284 63 HOW THE WAR WAS PAID FOR