Current accounting practices include in overhead:  taxes, interest, insurance and general items.  Actually the price of goods and services in a civilized economy includes minimal charges for raw materials and labor and maximum charges for overhead.

There is another phase of overhead which pyramids with each advance in the extent and complexity of a civilization—­taxes to cover the costs of government.  As the civilization expands and specializes, governmental services multiply.  The number of government workers grows in proportion and often out of proportion to the total production costs.  Expenses of government rise and with them the corresponding need to increase taxes.

Overhead costs in the village or small town are low.  Much of the “public service” is done by citizens who volunteer their time and energy.  In the centers of civilization public service is a profession, often well paid and usually quite permanent.

Expansion is a basic feature in the life of every civilization.  Expansion increases overhead costs.  When American Indians made their silent way through the forests or roamed the plains there was no overhead.  Each provided his own means of locomotion.  With roads came bridges.  With roads and bridges came capital costs.  As dirt roads gave way to macadam and macadam to asphalt and concrete, as country roads, winding over hill and through dale were replaced by graded superhighways cut straight through or built over all obstacles, the cost per mile rose fantastically.  All of these added costs appeared somewhere in the tax bills which citizens were required to pay.

In any enterprise overhead costs rise in direct proportion to the extent and complexity of the social order.  As they rise, they increase the prices of the goods and services which citizens (or consumers) must pay for their livelihood.  A good illustration of this principle is the price of an identical acre of land:  in the remote countryside; on an improved highway; in the suburbs of a growing city and at the city center.

Increasing wealth brings greater risks.  Wealthy cities like wealthy individuals and families must pay for their protection against robbery and piracy; against extortion and expropriation.  Among important business enterprises insurance ranks high.  The costs and profits of insurance are suggested by elaborate insurance company buildings and the high salaries paid to their officials.

Insurance, usually a private overhead, comes high.  Public insurance:  maintenance of law and order, crime and punishment, the secret and open police, the armed forces, (land and sea and air) are vastly more expensive.  If, to these limited costs of overhead are added the costs of militarism as a public enterprise and the ruinous costs of military adventurism and its inevitable wars, the mounting costs lead to insolvency and eventual economic and social ruin.