A nation differs from individuals in that no law can be imposed upon it by any external human power. The enforcement of the rights and obligations of nations in their intercourse with one another is left to the different nations themselves. As long as international law offers no peaceful means of redressing wrongs, war is the only recourse. " International law," says Woolsey, "assumes that there must be 'wars and fightings' among the nations." This assumption is universally correct. There are no signs, as yet, that nations will cease to consider that war, or at least the actual preparation therefor, as its sole preventive, is an absolute necessity. The whole theory of the independence and equality of sovereign States, upon which international law proceeds, throws the maintenance of national dignity, honour, and recognised national rights upon the nations themselves. The extent and character of preparation for war in each State depends upon its history, national character, and geographical situation. Thus, the warlike traditions, the mutual distrust, and contiguity of France and Germany, impel to extensive preparation for war, and similar considerations affect other nations of Europe. On the other hand, the traditions, national character, and geographical position of the United States have led to a feeling of security, and a preparation so insignificant compared to European armaments, as to call forth continual warnings and protests from military authorities. The necessity and probable continuance of this burden on the finances of nations being thus predetermined, the only task for the student of finance is to ascertain how great a burden this imposes on the treasuries and what possibility there is for some return.

There has been much discussion of the relative merits and economy of the different methods of army organisation. It is pointed out that the German system of compulsory service of all citizens without remuneration shows a much smaller cost, per man, than the English and American system of paid enlistment. But it is urged again that there are in Germany a larger number of expenses involved in the army system, than those of the government, as the personal expenditures of the soldiers, the cost to the country from the disturbance of production, the extra costs of enrolment, of free quarters during manoeuvres, etc., which do not appear in the budget, but which should be counted in before any fair comparison can be made. It would seem that, in the end, the actual expenditure for this purpose could only be as much less, per man, as the standard of life of the soldier is less in the one country than in the other. And on this ground it might be urged that the German system, which gives the soldier but little spending money to waste, and by very strenuous measures inculcates thrift and almost penurious economy, was on the whole the cheaper.

How much again this lessens the efficiency, per man, and necessitates a larger number of soldiers is hard to estimate. In England the volunteer system, while adding somewhat to the cost, does not make as heavy drains on the treasury as do the German reserves ; but as the expenditure by the individual members of the volunteer service is for a public purpose, it is a part of the cost of the system, and a part that is very difficult to estimate. On the whole no accurate comparison is possible. The actual expenses of the different nations as they appear in the budgets are as follows : England 1894-1895, army 18,000,000, navy 18,700,000, together, 36,700,000. United States 1895, army $54,500,000, navy $31,700,000, total $86,200,000, but this includes over $16,000,000 for the construction of new vessels. Including the amounts spent by the commonwealths the total expenditure for military purposes and the navy were, in 1890, $57,544,617. One of the main features of the American system is the establishment of training schools for officers, costing $360,000 for the military and $220,000 for the naval academy. In most countries this is a rapidly growing expenditure.

The expenses of actual war are not a part of the regular budget of modern nations. They are always treated as exceptional or extraordinaryexpenses. Besides the sums actually expended by the public treasury there are many indirect losses and expenses involved. According to the estimates of Wilson the cost of wars to England from 1688 to the present time was over 1,258,680,000. The cost to the United States of the Civil War is hard to estimate. The debt incurred amounted to $1,845,900,000 ; $800,000,000 of revenues were spent during the war ; commonwealths and cities spent a part of their current revenues and rolled up debts, and the pensions will probably amount to over $2,000,000,000. $6,000,000,000 represents approximately the actual expenditure by all the governmental agencies on the side of the North.

The general preparation for internal peace and security and the prosecution or punishment of the disturbance of that security by individuals or small groups of persons is a very important item of expense. Such security is generally maintained by the police and the military. In the United States the chief expense is borne by the cities. The States and counties have their own police officers for this purpose, as do, also, towns not cities. The cost of the police for the whole of the United States was, in 1890, $23,934,376.