security of the shareholders furnished these two powers with justification for a close inquiry into the financial condition of the country.

The first decade of Ismail Pasha's reign showed an apparently widespread prosperity, and a corresponding increase in the public debt. The 1864 loan of £5,700,000 was supplemented in 1868 and 1870 by further loans for £3,000,000, £1,200,000, and £2,000,000, and in 1873 there was another for £32,000,000, in Mr. Dicey's round numbers. The Khedive's private loans were about £11,000,000, and the floating debt represented from £25,000,000 to £26,000,000. Up to 1876 the regular payment of the high rate of interest kept good the credit of Egypt.

But the Russo-Turkish war, while it revealed the emptiness of the Ottoman treasury, served also to unsettle men's certainty of the credit of Egypt. Unable to raise fresh loans, or to meet the demands upon him, the desperate Khedive sold all his shares in the Suez Canal to England for the sum of four millions in November 1875. The idea of buying the Khedivial shares belongs to Mr. Frederick Greenwood. It was hailed with general delight at the time; though it was then, and has since been, savagely attacked by a certain kind of Liberal politicians. Mr. Dicey points out that it is certainly a financial success, as the shares are now worth more than double the price we paid for them. Assuming the importance of a control of the Suez Canal to England, it is difficult to see how she could have done better than buy of the well-nigh bankrupt Khedive. The politicians who were most bitterly opposed to the purchase would have been still more unwilling to see England set a corporal's guard at Port Said, and hoist the Union Jack in the Egyptian Delta. At all events, England had her shares, and the Khedive his four millions, but he did not keep them long. Four millions were soon swallowed up in the whirlpool of his debts, and money was as much needed as ever. The Khedive turned again to England. A nation who was so ready to buy might no less readily lend, but the Khedive was shrewd enough to know that she would not lend without security. He invited England to study the state of his finances before advancing, and England in reply sent out Mr. Cave, at the end of 1875

The revenue was drawn from direct taxes on land, on date-trees, on trade licences; from indirect taxation in the form of custom and tobacco duties; from the Moukabaleh, the village annuities, from railway profits, and miscellaneous dues. The Moukabaleh, which means compensation, was a measure introduced in 1871 to redeem half the land tax, in the hope of paying off the floating debt. The Government proposed to give the Egyptian landholders, who had no regular

title-deeds, indefeasible titles, and to reduce permanently the land tax by one-half, in consideration of their paying six years' land tax in advance; a financial blunder which has introduced terrible complications into the duty of unravelling the Egyptian finances.

The village annuities are the amounts paid by the cotton growers to the Government for adopting the debt of about one million, which they incurred by the reduction in cotton in 1870. This, as well as the Moukabaleh, was to expire in 1885.

Mr. Cave made his famous report, showing that nothing could be done without accepting heavy pecuniary responsibility, and then he returned home, and Mr. Rivers Wilson, the controller of our own National Debt office, went out to advise the Khedive, only to be recalled soon after. The Khedive had so far failed to draw England, and at last, in May 1876, he calmly issued a decree of repudiation. This was rendered a dead letter by the international courts, tribunals which had been substituted by the European powers for the old consular jurisdiction, and which had great authority in Egypt. These courts decided that the Khedive had broken his contract to his foreign creditors, and his May decree took no effect. The French bondholders then proposed a scheme of their own for the consolidation of the debt, which fell through owing to the objections of the English bondholders. The two parties then agreed to send out a joint mission to negotiate with the Khedive, and Mr. Goschen and M. Joubert proceeded to Egypt at the end of 1876. The Khedive agreed with them to pay an annual sum, as interest and sinking fund, of about, in round numbers, seven per cent. on a capital of £100,000,000. In less than a year, however, Ismail Pasha declared that this arrangement was based upon highly untrustworthy returns, that the debt must be reduced, or Egypt would be ruined by the taxation enforced to pay the interest, and once more he demanded a fresh commission.

When a country has once accepted an investigation of its finances by foreign powers, and given the practical control of its treasury into the hands of foreign representatives, its claim to independence can hardly fail to be regarded as signally diminished, and it is hardly surprising that both England and France began to think themselves something more than the mere friends and advisers of the Khedive.

A suspicion of the Khedive's honesty led the French Government to decide that any inquiry now set on foot should apply itself, not only to ascertaining the resources of Egypt, but the causes which brought about Egypt's embarrassments. In this demand England was, under M. de Lesseps and Mr. Rivers Wilson, induced to join, and the Khedive was forced to allow a commission to

practically place him upon his trial. It was soon shown that the Khedive had become the owner of one-fifth of the entire cultivated land of Egypt, and that the funds oppressively raised from this vast monopoly were, in Mr. Dicey's words, "so miserably administered as to result in a loss, not only to the country at large, but to the Khedive himself." A threat of the Khedive's that he would be unable to pay interest on the Unified Debt in full forced matters to a crisis. France insisted on the interest being paid in full, and somehow or other paid in full it was. This strong action on the part of a European power may have convinced the Khedive of the hopelessness of his position. At last he met the report of the commission, which declared that real financial reform must commence with the concession of his estates, by yielding up a million of acres of Daira land to the creditors of the State.

The next step in the work of the commission-the inquiry as to what amount the country could afford to pay annually in respect of its debts, without injury to its own interests and to those of its creditors-was interrupted by the unexpected summons by the Khedive to Nubar Pasha from exile to form a ministry, in which the portfolio of finance was to be entrusted to Mr. Rivers Wilson. Mr. Rivers Wilson was controller of the English National Debt, and he succeeded in obtaining permission from his own Government to retain this office while accepting the portfolio offered him by the Khedive. This permission aroused the gravest suspicions in France, where it seemed to statesmen as if England, after all her pledges, was seeking by underhand means to obtain complete supremacy in Egypt; and, in order to satisfy the complaints of France, M. de Blignières was appointed, much against England's will, as the colleague of Mr. Rivers Wilson in the new Nubar Ministry.

Having yielded thus far, and made such concessions, the Khedive was seized again with a despotic mania, which led him, on the strength of a small army émeute, to dismiss Nubar Pasha, and shortly after to dispense with the services of his French and English ministers.

The dismissal of the Anglo-French ministers caused greater annoyance even to France than to England, and the French Government proposed to compel the Khedive by armed force to reinstate Mr. Rivers Wilson and M. de Blignières. The arguments of England, however, prevented this step, and strong despatches alone were addressed to the Khedive. This action convinced the Khedive that he was perfectly safe in doing as he liked, and naturally he did not reinstate his ministry. His former clique of Pashas were restored to power, Nubar and Riaz Pashas were exiled, and money was raised VOL. CCLII. NO. 1816.

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in the old evil ways. The warnings of England and France were despised, and he finally issued a decree, leaving entirely in his own hands the regulation of the liabilities of Egypt. The Khedive appeared to be entirely triumphant, and France and England seemed content to do nothing, when the sudden intervention of Germany forced them into action; the German consul at Cairo informing the Khedive that the German Government was prepared to defend the interests of German subjects at all hazards. Then England and France joined together, and accepted the offer which had been made before by the Sultan to depose the Khedive. The moment the order came, the power and the triumph of Ismail Pasha vanished into nothingness, and the bold defier of united England and France hurried away as rapidly as he could to Naples with his harem and his ill-gotten treasure, leaving his son Tewfik on the throne.

After the fall of Ismail the Anglo-French influence was re-established. M. de Blignières was reinstated, and Mr. Baring, who was afterwards succeeded by Mr. Colvin, took the place of Mr. Rivers Wilson. They were given great authority. They had the right to be present on the ministerial council, to advise on all financial questions, to appoint resident inspectors and receive their reports, and they were irremovable save with the consent of England and France. But in the face of their trying task even such powers seemed slight. Their difficulties lay not alone in Egypt; Austria, France, and Italy insisted that any financial settlement must be arranged by an international commission, in which other powers besides France and England should be represented; and such a commission was at length appointed with French, English, German, Austrian, and Italian members. The powers of the commission were theoretically unlimited; practically they had many limitations. They could not, like ordinary liquidators, bring the bankrupt whose estate they were considering to reason. So long as the European powers were not agreed together in compelling the Khedive to accept the advice of the commission, the commission had to wait his consent for any arrangement they made. As Mr. Dicey shows, the bankrupt was able to estimate his own revenue, to fix his own allowance, and to appropriate the bulk of an eventual surplus, after which the liquidators were allowed to distribute the sum which the bankrupt considered available for the payment of a composition to his creditors. The Moukabaleh claims were quietly shelved after a fashion much more agreeable to the Egyptian Government than to the claimants. To Mr. Dicey the liquidation seems "not in any sense a comprehensive settlement of the Egyptian financial problem," and he maintains that "the consolidation of all Egyptian loans into one stock,

paying one uniform rate of interest, and the collection of the revenue by one central administration, are the essential conditions of any effective and permanent reorganisation of Egypt."

In the mean time, however, there had been growing up in Egypt a spirit of hostility to the European intervention. A party calling itself the National Party began to lift its head against the foreign rule. " "Egypt for the Egyptians " was its cry; it refused to tolerate ministers representing some special European influence; it demanded for Egypt the right to govern itself in its own way. The doctrines of the party, at first circulated by stealth, soon became more widely known; it was presently to be discovered that it had the army at its back. A bloodless insurrection, the famous "insurrection of the Colonels," suddenly gave the National Party a position and a leader. This leader is Arabi Bey, who at the present moment appears to hold the fortunes of the Egyptian Government, as Kossuth held the destinies of the House of Hapsburg, in the hollow of his hand. Ever since the day when the soldiery of the citadel pronounced against the Khedive, the star of Arabi Bey has been in the ascendant. The socalled Egyptian Parliament was no sooner summoned than it found its real master in the Colonel, and not in the Khedive. Tewfik's ministry has fallen before his dictation; the ministry in existence is practically in his hands. But Arabi Bey's political career has been hitherto too brief to show whether he is the Cromwell of a great movement against an Egyptian Charles; the Garibaldi of a struggle for national liberty against a foreign rule; a scheming political adventurer, fighting for his own hand like Hal of the Wynd; or only a puppet, whose actions are guided by mysterious unseen strings.

Sir William Gregory, whose opinion should be listened to with respect and attention on Egyptian matters, both from his knowledge of the subject and his experience as a politician, has told the world what he thinks of the practical dictator of Egypt. He sees in Arabi Bey a man of great and patriotic ideas, with an eloquence which at times reminds Sir William of the utterance of Sophocles' Antigone, and inspired by the loftiest love of his country. This opinion is practically shared by another Englishman whose name is associated with Egyptian politics, Mr. Blunt, who, having sung of many loves under the name of Proteus, finds sterner pleasure at present in the struggles of the Egyptian democracy. Sir William Gregory is in favour of what he calls home rule for the Egyptian race. Mr. Dicey, on the other hand, would advocate some strong policy of English interference. Mr. Dicey is openly in favour of the preservation by any means of English authority in Egypt. He regards the possession