The difficulties of Herr Sydow's position are further illus- trated
by the Prussian Budget Estimates presented by Baron von Rheinbaben in the Lower House of the Prussian Diet. The financial year 1907-8 closed with a deficit of £3,500,000 ; 1908-9, now closing, is expected to show a deficit of £8,250,000 and 1909.10, exclusive of £6,350,000 for matricular contribu- tions, £7,800,000, which will necessitate another loan. The chief sources of Prussian revenue have declined; £6,300,000 has to be provided for increased official salaries, and £3,000,000 for " extraordinary railway " expenditure, while the railways are expected to yield 25,000,000 less in revenue than 1908,—figures which may give pause to British advocates of railway nationalisation. Trade is bad, and, according to Baron von Rheinbaben, is likely to be worse before it is better. But the crux in Imperial finance is the question of matricular contributions. Until the present system is revised in drastic fashion, all schemes and proposals for meeting deficits will be mere palliatives. We may add that several other German kingdoms and States are financially in much the same condition as Prussia.