which he had lent, and which the debtor did in reality and justice owe. For this fictitious debt which we have thus created we have rendered the property of the debtor subject to execution and his person to imprisonment. It is not that we have protected the creditor in his just rights; we have defrauded the debtor, and taken away his property, in this proportion and in this manner, throughout the whole extent of the kingdom. "These measures are laws by which we have established that all the public burdens shall be in a like proportion increased. They are additional taxes which we have imposed; pensions and salaries which we have distributed, amidst the increase of the public distress. We had accumulated a mass of annual taxes, to the amount of sixty millions, by a long and gradual course of taxation, directly imposed; we had increased pensions and salaries to twelve millions annually, by a long course of gradual, direct, and progressive augmentation; and then by these measures we proceeded to augment at once every existing tax on whatever it was imposed; every pension and every salary for whatever service: we accomplished this by a disguised and hidden operation, concealed from the view of the people, on whom we caused these augmented burdens suddenly to fall,from the view of their representatives, from our own view, our attention being occupied with one miserable object, and with one only. The sixty millions of annual taxes we thus made equal to one hundred millions, and the twelve millions of salaries and pensions have been made equal to twenty millions. We found eight hundred millions of accumulated debt, and we increased it at once to fourteen hundred millions, in their effectual pressure on the industry of the people, in their effectual drain on the property and resources of the country; which property and which resources we thus gave over to the creditors and servants of the state. Our annual taxes are at this moment, and by these means, more than three times the amount of all the rent of all our land; and we pay more in pensions and salaries than all the cultivators of all our soil can ever in future obtain. "These are the effects, the nature, the character of these operations, of magnitude and wrong without a parallel, which have been thus carried into effect." Bolder sophisms than these have seldom, we believe, been advanced in the British House of Commons; but as they were refuted by anticipation, in the masterly speech of Mr Huskisson, it is not necessary to extend farther our account of the debate, or to attempt any abstract of Mr Peel's reply. We may, however, be permitted to observe, that the whole reasoning of Mr Attwood is built upon assumptions, all of them false in theory, many of them erroneous in point of fact. For example, he denies that the fall in the price of corn has been produced by an excess in the supply, as compared with the demand. And how does he prove this allegation? By informing us that a concomitant fall to nearly the same amount with corn has taken place in the price of iron, wool, and cotton. Now, assuming the fact to be as he has stated, it is clear that the analogy here attempted to be established cannot possibly hold; for the price which these commodities bring in the market, must depend upon the demand for the articles into which they are manufactured. But this demand may be affected by a number of causes, which can have no influence upon the demand for corn, an article of the first necessity, and which undergoes no process of manufacture before it is fitted for consumption. In the next place, in estimating the increase in the value of money at 45 per cent., it is plain that Mr Attwood does not refer to the period when Mr Peel's bill was passed, but to the period of the greatest depreciation; and that he charges the whole increase in the value of the currency to that measure. Now, it is to the system which allowed of such violent fluctuations in the value of money, that Mr Peel's bill put an end. If, indeed, as Mr Ricardo remarks, the price of gold in 1819, or immediately preceding 1819, had been L.5, 10s. per ounce, no measure could have been more inexpedient than to make so violent a change in all subsisting engagements, as would, on that supposition, have followed the restoration of the ancient standard; but the price of gold was then, and had been for four years, about L.4, 28., that is, the currency had come within 5 per cent. of gold; and surely no proceeding could have been more monstrous, than to have again degraded it 30 per cent. below the value of the standard. How, then, could Mr Peel's bill have raised the value of money 45 per cent., and sunk the price of all other commodities in the same proportion, when it is evident that it only raised the value of paper 5 per cent., as compared with gold; or, allowing for the effect produced on the price of gold by the premature purchases of the Bank of England, at the most 10 per cent.*? Upon what principle will he account for the supposed increase, amounting to the remaining 35 per cent.? Even in 1813, the depreciation did not exceed 30 per cent.: how then can it be alleged, with any show of reason, that Mr Peel's bill raised the value of the currency 15 per cent. above the maximum of depreciation? As to the expedient of the Bank renewing its advances to Government, it only amounts to this, that now when contracts of all kinds have begun to adjust themselves to the restored standard, when the prices of all commodities have been nearly regulated to a better and sounder state, and when the country has just begun to recover from the evils which unavoidably followed the abandonment of the pernicious system pursued from 1797 to 1819, every thing is to be unsettled by a new convulsion, and the whole country thrown into confusion, that a nominal, not a real rise, may take place in the money price of corn. But it is useless, after what has been so ably urged against this perilous proposal, to waste another word in attempting to refute it. Mr Brougham having, inconsistently enough, spoken in support of the motion, and Lord Londonderry against it, the House divided, when there appeared for Mr Western's motion 30, against it 194, majority 164. Mr Huskisson's amendment was then put and agreed to. Undismayed by this total and memorable defeat, Mr Western, tenax propositi, determined to encounter the peril of a second, and on the 10th of July brought the subject again before the House, in a string of eighteen resolutions. Fortune, however, does not always favour the bold: the resolutions were negatived without a division. This argument may be put in another shape. The whole amount of taxes paid to the public creditor is thirty-six millions, or, including other fixed charges, forty millions. Now, supposing the land to pay one half of the whole taxation of the country, after deducting that part of the expenditure which depends on the value of money, and estimating the rise in the value of the currency at ten per cent., then the sum upon which the altered value of money has operated is forty millions, and the whole increase of taxation which has fallen upon the landed interest, including tenants and landlords, is four millions per annum. But, according to the allegations of the landed interest, rent is now paid from capital, leaving nothing for profit; therefore, if the only cause of distress be the alteration in the value of the currency, as Mr Western and Mr Attwood assert, it follows that, before such alteration, four millions must have constituted the whole income both of landlords and tenants; that is, from four millions of annual income, they must have paid annually twenty millions of taxes, or one-half of the whole taxation of the country, with the deduction above specified ! CHAPTER IV. FINANCE. Reduction of the Navy five per cents.-Superannuation Amendment Act Bill. -Scheme for equalizing the Naval and Military Pensions, and Half-Pay and Civil Superannuations-Fallacy of the project-Mr Hume's Amendment negatived.-The Scheme receives the approbation of Parliament, but fails for want of Contractors.-Brought forward anew in a modified form. -Two Amendments proposed by Mr Hume, and rejected.-Project, as remodelled, carried into effect.-Repeal of the Annual Malt Tax.-Mr Calcraft's Motion for a Repeal of the Salt Tax, lost by a majority of fourThe two Junior Lords of the Admiralty reduced, Ministers being left in a minority of fifty-four.-Lord Normanby's first Motion for the Reduction of one of the Postmasters-General negatived by a majority of twenty-five; the second carried by a majority of fifteen-Mr Creevey's Motion on the Board of Control, negatived. Mr Lennard's Motion on our Diplomatic Expenditure, and Mr Warre's on the Mission to the Swiss Cantons, rejected.-Reduction of the Salt Tax, Irish Window and Hearth Tax, Leather Tax, and Tonnage Duty-Navy, Army, and Ordnance Estimates.-Budget.-Mr Hobhouse's Motion for the Repeal of the House and Window Tax.—Mr Hume's Resolutions on the National Debt and Sinking Fund. ONE of the measures, it will be remembered, by which Ministers proposed to afford some relief to the agriculturists, was the repeal of the annual malt duty. This reduction had been resolved on, and a pledge to that effect given to Parliament, in consequence of the saving in the permanent charge of the public debt, which, it was calculated, would accrue from the conversion of the Navy five per cent. into four per cent. stock. The accomplishment of this important financial arrangement being, therefore, an indispensable preliminary to the repeal of the tax for which Government was pledged, Ministers lost no time in bringing forward the plan upon which it was to be effected, and which was in substance as follows: The stocks which bore interest at five per cent., were of three descriptions. The first and most considerable part was termed Navy five per cent. stock, which, at the commencement, was formed by funding navy and victualling bills to the amount of 25 millions, and which had subsequently been increased by funding Exchequer bills, and the loans raised in it, till it formed a total of 141 millions. The second description consisted of Irish five per cent. stock, raised for the service of Ireland, but on the credit, and payable at the Exchequer of England, and since the union of the treasuries, chargeable on the consolidated fund of the United Kingdom; this stock amounted to L. 1,400,000. The third species of five per cent. stock, created for a loan negociated in 1797, generally known by the name of the Loyalty Loan, and now of small amount, though originally much larger, was not included in the proposed conversion, owing to the peculiar conditions of redemption annexed to it. The remainder of the five per cent. stock, therefore, to which the proposed operation was to be applied, amounted to about 142 millions and a half; and this it was intended to commute into a four per cent. stock, the dividends on which were to be payable half-yearly, on the 5th of January, and the 5th of July; the said four per cent. stock not to be liable to be paid off until the 5th of January 1829. All holders of five per cents., who should not signify their dissent, were to have, for every L. 100 five per cent. annuities, L. 105 in the new four per cent. stock; the first dividend on which was to be payable on the 5th of January 1823. Books were to be opened at the Bank, from Monday the 4th, to Saturday the 16th of March, both days inclusive, for receiving the signatures of persons dissenting. Persons not signifying their dissent within this period were to be held as having assented, unless they were out of the United Kingdom during the whole of it; in which case it was provided, that they might enter their dissent any day before the first day of June 1822; and persons who might be in any other part of the world except Europe, were to be permitted to express their dissent at any time before the first day of March 1823. Persons dissenting were to be paid off numerically, in the order in which their names should be subscribed; and this payment was to commence on the 5th of July 1822, and to be continued at such periods, and in such manner, as Parliament should direct. All holders of five per cent. stock were to receive the dividends due on the 5th of July 1822; and trustees were to be indemnified by act of Parliament. By this commutation, it was calculated that L. 1,140,000 of annual charge would be reduced, exclusive of a farther reduction of L. 90,000 on the Irish five per cents, making a total saving of L. 1,230,000 *. On the 25th of February, the Chan The precedent by which Ministers were in a great measure guided, in proposing the above plan for the conversion of the five per cent. into a new four per cent. stock, was that established by Mr Pelham in 1749, and sanctioned by the act (23d George II.) which bears his name. The proposal was originally brought forward by Sir John Barnard in 1737, but did not then meet the concurrence of Parliament. In 1749, however, Mr Pelham, then Chancellor of the Exchequer, adopted the idea, and proposed to Parliament a plan for reducing that part of the national debt which consisted of four per cent. stock, and which then amounted to fifty-seven millions. The plan was this: A subscription was opened for the holders of the four per cent. stock, and the persons subscribing were entitled to receive three and a half per cent. for the next seven years, and three per cent. afterwards. The period fixed for the subscription was three months, at the end of which time more than thirty-eight out of fifty-seven millions of stock had been subscribed. Some great stockholders, however, encouraged, it is said, by the political opposition of the day, raised a violent clamour against the scheme, and prevented the complete success of this first subscription; but Sir John Barnard published a pamphlet on the subject, which contributed greatly to allay the ferment which had been excited, and, in conjunction with the firmness of Parliament, led to the completion of the proposed plan. The time allowed for the first subscription having expired, a second subscription was opened, (on terms rather less favourable to the holders of stock than the former one,) under which about L. 15,600,000 were subscribed, leaving only about L.3,400,000 stock, which was repaid in money to the holders. The total of the debt being then only cellor of the Exchequer submitted to Parliament the plan of which we have now given an outline. Among the various difficulties and objections to which it was alleged this measure was liable, the most prominent were the inconvenience which would attend paying off numerically those persons who should express their dissent; the shortness of the time allowed for doing so, the addition of a capital of seven millions to the national debt, the quantity of property forced into the foreign funds by the holders of five per cent. stock, consisting in a great proportion of small annuitants selling out in alarm at the threatened reduction, and the clause of the act 24th Geo. III. § 6., by which the Navy five per cents. were established, and which declares, "That the said annuities shall be irredeemable, until twenty-five millions of the public debt, bearing interest after the rate of either three pounds per centum per annum, or four pounds per centum per annum, shall have been redeemed and paid off;" no such diminution, it was alleged, having yet taken place. These objections were answered by the Chancellor of the Exchequer. Some reasons, he said, were urged for prolonging the time at which holders were to make their option; but the period on which Government had fixed was sufficiently long to enable them to make up their minds on the subject. As to the question, from what fund and in what manner the payment was to be made to such holders as did not assent to the terms; that question could not be answered until the option was made. As soon as the number of persons dissenting was ascertained, the plan by which they were to be repaid would be submitted to Parliament. As to the hardship with which the transfer was likely to operate upon persons of small property, it should be recollected, that such persons had purchased this stock at a lower rate, and with a larger return of interest, under the express liability of being paid off by Government. However much, therefore, they might be objects of commiseration, they had no title to complain; and the inconveniences of their situation would be mitigated by the great reduction which had taken place in all the necessaries of life. The rise in the price of foreign stocks had been attributed to the plan now proposed by Government; but it should be recollected, that that rise had taken place long before the present plan was promulgated. It was not the plans of Government, but the alarms which had been raised in consequence of rumours that the public credit was about to be infringed, which had had the effect of driving large sums of money abroad, and consequently of raising the price of foreign stocks. He doubted not that a contrary effect would take place; and that such sums as had been withdrawn from the country under the influence of a temporary panic would return, when it was known that there was no foundation for such rumours, and that the public credit was fixed upon a secure and lasting basis. With regard to the right of Government to redeem the five per cent. stock, no doubt could be entertained. In 1784, it was stipulated that it should not be redeemed until L.25,000,000 of three per cent. stock had been paid off. It was denied that this had been done. The stockholder at that time stood in this situation, that seventy-eight millions, fifty-seven millions, the sum reduced, though much smaller in absolate amount than the Navy five per cents., formed a much greater proportion of the whole debt of the nation. Under Mr Pelham's plan, the public ultimately obtained a relief to the extent of L.570,000, but, until the lapse of seven years, it did not exceed L.285,000. |