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himself indicated some of the most important of these exceptions, and the list has been extended by his successors. But these exceptions were all based upon reasoned principles, such as the incapacity of the persons concerned, e. g., children to make fair contracts; the lack of individual interest in public works, e. g., the maintenance of roads, and the importance of the highest security, as in the regulation of the issues of bank notes. And in spite of all these exceptions—strengthened and purified by these exceptions—the presumption remained undisturbed. Recently, however, some writers, under the influence of the ideal of maximum happiness and impressed by the power of the state, have sought to extend its interference far beyond these admitted principles-But, so far as this movement has any theoretical support, the reaction has already begun. The fundamental importance of freedom of contract has become more apparent than ever through the application of the comparative and historical methods to jurisprudence; the proposition that the progress of society has been from status to contract has almost acquired the force of an axiom. The analysis, too, of modern industrial systems in which division of labor has become more and more intricate and interdependent has shown the hopelessness of the attempt to transfer the management and control to the state. Changes in the methods of production, in the diffusion of knowledge, and in the transport of material commodities have been so rapid and so great that no executive government could have overtaken them. In the most advanced communities even that legislation which is necessary for the new conditions lags behind; even those elementary forms which simply aim at giving an interpretation to contracts in doubtful cases, or which are necessary for the adjustment of responsibility (as in bankruptcy and partnership), are behind the times. The growth of joint-stock enterprises has outstripped the development of the law of companies, and there is a crop of new frauds without corresponding penalties. Turning to the executive and administrative functions of government, the analysis of existing conditions shows that we have not yet overtaken those exceptions admitted by the strongest supporters of laisser faire. The British Government has, it is true, wasted its energies in devising temporary expedients of various kinds, but it has not yet accomplished the programme of Adam Smith. Not only are there privileges and restrictions that ought to have been abolished long ago, but on the positive side the programme is not complete. We have just begun universal education on the lines laid down by Adam Smith, but his scheme for imperial federation is not yet within the range of practical politics. We have effected great financial reforms, but we still fall far short of the full development of his principles. Even in matters of currency