ling and neglect through lack of appreciation of the measure of the interests at stake no people can afford.
Let us assume that the discussion of Oregon's system of public revenues in chapters one and two of Part Two sufficed, in a measure, to bring before the mind's eye the flow of means utilized in the past life of the state. We desire still such a review of the remaining phases of the state's experience with its finances as will enable us to pass judgment on what constitutes the right ordering of them; and the discus- sion should also suffice to shed as much light upon the course of the commonwealth's life as financial records are adapted to give. To attain these purposes an examination of the public expenditures, the public credit and budgetary legislation and treasury administration, respectively, in Oregon is in order.
The Flow of Public Expenditures. — It will give the aid of concreteness to conceive of public expenditures as a flow, a stream of wealth passing through the state treasury. This flow has its largest source by far, as we have seen, from the annual income of the tax-payers. Only a small part of it in Oregon comparatively has come from the state's public domain, either as income from sales or as the income of interest from the loan of trust funds accumulated through previous sales. These two tributaries quite distinct in character thus make up this volume of public funds flowing into the state treasury. Initially, these revenues from taxation and from the land funds alike have their sources in the annual social income of the Oregon people, — from the net product secured by them from the soil, the rivers, the mountains and the factories. A portion of this collective surplus is diverted to the state treasury. The main part of it being used for the individual, the family, the local institutional and governmental needs. In this discussion we are concerned only with that particular portion diverted through the action of representative agencies of the people to the state treasury and consumed as public expenditures.
