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sidn of that revenue, arising either from direct reduction of taxation, or from diminished consumption, there would still remain a surplus of 714,000/.
In regard to the debt due to the Bank, which, it had been alleged, fettered the Bank in its operations, and disabled it from giving to the public that aid which it would otherwise have the means of affording, the chancellor of the Exchequer allowed, that it would be a very desirable object to effect a reduction in the amount of the advances made by the Bank, by which that debt had been constituted. The Bank held Exchequer bills of two sorts: the first sort consisted of bills upon which the Bank had originally and directly advanced money to government. The other sort were bills which they had purchased in the market, without any advance to government, and which they might have sold without affecting their transactions with government in regard to the former. Of the first sort of bills, the Bank held, on the 5th of January, 1826, 6,000,000/. In February, for the purpose of relieving the money market from the pressure which seemed to operate on this species of security, the Bank had purchased to the amount of 2,000,000/., upon an undertaking by government that they should be repaid in the course of the present year. The Bank was farther a creditor of the government for rather more than 3,000,000/., advanced for the purpose of paying off the four per cent dissentients: but provision had already been made for these last advances by charging them upon the sinking fund, and, at the close of the present year, they would be very nearly extinguished.
There still remained, therefore, about 8,000,000/., which it was the intention of government to pay off as convenience and their means allowed; and to begin by repaying to the Bank, during the present year, the 6,000,000/. of Exchequer bills, upon which direct advances had been made to go* vernment. f -I
The statement of the chancellor of the Exchequer, holding out much happier prospects than, from the distress which prevailed in the country, could have been anticipated, was received by the House with general satisfaction. Mr. Maberly, however, and Mr. Hume maintained, not only that there had been no reduction of the public debt, but that there had been an actual increase both in the capital, and in the annual charge, and that taxation had been raised, instead of being diminished. The capital of the debt, it was alleged, had been augmented by no less a sum than 6l,646,000/. between 1819 and 1826, and the annual charge had grown in proportion. This assertion rested entirely on a very obvious fallacy, arising out of a total misapprehension of the nature of what is called the deadweight-scheme, and of the arrangements, which, in pursuance of it, had been made with the Bank for discharging part of the half-pay and pension list. Mr. Hume's assertions, that taxation had increased during the last three years, was still more obviously and utterly erroneous. When such assertions arc hazarded in direct opposition to figures, and the votes of the House proving that, from 1816 to 1825, more thantwenty-seven millions and a half of taxes had positively been reduced, and no new taxes imposed, they argue great confusion as to facts, or great obliquity of intellect in the person who considers them. The taxes, said Mr. Hume, produced in 1817 £.51,183,000
But, in each of the then following years, more money had been taken from the people than in 1817, 1818, and 1810. The amount of taxes raised in
1823 was £. 52,561,000
It was, therefore, he argued selfevident, that, in the eleventh year of peace, when the people had a right to expect some relief from taxation, they were actually paying a million more annually than they had done in the years which immediately followed the conclusion of the war. But Mr. Hume, while he could not pretend that new taxes had been imposed, or deny that many old ones had been repealed or reduced, forgot that the increase of the revenue was merely the result of an increase in the consumption of excisable articles, and that this increased consumption was the effect of the reduction of the Excise duties. That reduction, by lowering the price of the articles, both enabled many persons, beyond the reach of whose means they had formerly been placed, to become consumers, and enabled those who had always been consumers to become consumers to a greater extent—and all this was a direct addition to the comforts and enjoyments of the people. In one sense the country may have paid more than before; but that was only because people had it in their power to enjoy a greater quantity of necessaries or conveniences. The increase of
revenue with diminished duties was the best index of the increase of comfort among the great mass of the population.
The state of the public debt, subsequently underwent much more lengthened and detailed discussion on two different occasions; and on both occasions the great questions were, not whether it ought to be reduced, and might be reduced, but, what was its actual amount, and whether in point of fact, any diminution of it had been effected during late years. On the 10th of March, the chancellor of the Exchequer having moved that the House should go into a committee of supply, the Speaker's leaving the chair was opposed by Mr. Maberly, whobrought forward, as an amendment, a series of resolutions concerning the state of the unfunded debt, the effects of the measure called the dead weight, and the real amount of the funded unredeemed debt. The amount of unfunded debt in Exchequer bills was, on the 6th January, 1826, thirty-seven millions and a half; and these se^ curities, he said, were so apt, from their very nature, to bring both the government and the Bank into sudden difficulties, that the reduction, or the funding of them ought never to have been lost sight of. On the 11th of October, 1825, there were 2 0,160,000/. receivable as revenue, and then due, being in fact promissory notes payable on demand, while government had not a shilling with which to meet them. The consequence was, that, on any depreciation of these securities, government, in order to prevent them from being paid in as revenue, was compelled to take measures to keep up their value; and as this was always effected by means of the Bank, the Bank in its turn was hampered by its connections with the transactions of government. In December 1825, Exchequer bills were at a discount of 80*.; government became apprehensive that they would become revenue; the Bank was sent into the market, and, by purchasing, brought them up to par. In addition to this, the interest was raised from \\d. to Zd. per diem, to guard against any extraordinary depreciation; yet, in the following February, they were again at a discount of 21*., and the Bank again came into the market, and, by its purchases, brought them up to par. Various circumstances might have prevented the Bank from making these purchases without injuring its own credit; and the consequence would have been that, by the paying in of these bills as revenue, the Exchequer would not have possessed the means of paying the dividends, unless the Bank had been able to advance the whole amount. But as the Bank had already advanced 5,548,817^., to pay the January dividends, it washighly improbable that it could, at such a moment, have advanced an additional sum of upwards of three millions (which would have been required) without placing itself in a most hazardous situation. The Bank had been able to avert these consequences by its purchases; but, as it might often turn out otherwise, nothing could be more improvident and unwise than to allow so large an amount of an issue of so dangerous a nature, to remain unfunded. He, therefore, moved as a resolution, "That notwithstanding the low rate of interest which has been paid on Exchequer bills, it has been both inexpedient and dangerous to leave so large an 10^000,000/. but of nearly thirteen millions and a half: On January 5th, 1819, the amount of unprovided Exchequer bills in the hands of the Bank, and of the public, was 19,4-80,0001.; and, on January 5th, 1826, it had been reduced to 6,139,000/. This reduction had been effected principally in the first three years, from 1819 to 1822, during which 10,000,000/. had been reduced, in conformity with the recommendation of the bullion committee; and, in the course of the three following years, a farther reduction of upwards of 3,000,000/. had been effected. Facts like these sufficiently vindicated government from airy charge of having neglected the reduction, or having been favourable to the growth of the unfunded debt. It could be reduced only in one of two ways, by converting the Exchequer bills which constituted it into stock, or by raising money to pay them off. Now it had beeH the opinion of government that the country would gain more by reducing the taxes, by encouraging manufactures and commerce, by reducing the Customs, and striking at the prosperity of the contraband trader, than by funding a greater quantity of Exchequer bills; and on that opinion they acted. Besides, at no time since 1818, could the funding of Exchequer bills have gone on, without loss to the public. If the whole sum of 44,000,000/. the amount of the unfunded debt, provided and unprovided, in the hands of the Bank and the public in January, 1819, had been funded in that year, it would have cost the country an additional charge of 5,125,000/.— if in 1820 £.5,352,000
amount of debt unfunded; that it might have been funded on most advantageous terms, and at a saving of some millions to the country, whilst, by leaving it unfunded till a period of political difficulty arrives, it cannot fail seriously to affect public credit, and to impair the energies of the country; and that it appears, therefore, to this House, that it is highly expedient to reduce the unfunded debt within more reasonable limits."
The other resolutions of Mr. Maberly went to impeach the accuracy of the official returns of the national debt, as having stated it more than an hundred millions below its real amount. First of all, the dead-weight had made an addition to the debt of nearly seventy-five millions. That arrangement was, in fact, a grant by government of an annuity of 2,800,000/. for a term of forty-five years. The value of this annuity, now that it had 4l£ years to run (3f years of the term having elapsed since it was first granted) was 74,632,000/.; and to this extent, the transaction was the raising of a loan by the country, and an addition to the public debt. The whole measure was one of the most dangerous and improvident to which recourse had ever been had; and it was not less so, because the Bank had been induced to purchase a part of this annuity, for which they had advanced 13,000,000/., while there was no probability of their being able to sell what they had thus locked up their funds in buying. So far as it remained unsold, the act authorizing the arrangement ought immediately to be repealed. By disregarding this burden, as well as some others, the amount of the public debt had been stated by
government at more than an hundred millions below its real amount. That statement omitted altogether tbe ilebt, duo on the life annuities and long annuities; no value had been put upon this large proportion of the public debt, any more than on the dead-weight: but the value of these charges, according to the statements of the government's accountants, exceeded 101,000,000/., a sum wliich must be added to what had hitherto been held out to the country as the total amount of the debt. On the 5th of January, 1819, the debt was 832,000,000/.; and, since that period, notwithstanding the boast of a Sinking-fund, and all the amount of our annual taxation, it had increased enormously. From returns signed by officers at the National Debt office it appeared, that, in January, 1826, the debt was 61,646,6361. higher than in January, 1819, the life annuities being valued, in both years, upon the same principles. A consequence, and at the same time a proof, of this increase in the debt, was the increase in the annual charge, which, in 1826, exceeded that of 1819 by 31,39S/. Thus, in the course of seven years, the capital of the debt had been increased by nearly 62,000,000/., and the annual charge, by more than 31,000/1.; although government considered themselves to have saved the country between 1,500,000^. and l,600,OOOZ.by the conversion of the five per cents into four per cents. The resolutions now proposed stated the fact, that by granting an annuity of 2,800,000^. for fortyfive years, the amount of the public debt had been increased by a sum equal, according to returns made to the House, in March, 1820', to 74,632,051/.:—that, exclusive of the portion of such annuity which
This proceeded, indeed, on the supposition, that the whole amount had been funded; but the funding of any part of it would have brought upon the country a proportional additional charge. To complain of government not having funded largely in 1823, was to complain of the absence of mismanagement. The funds in that year had not been between go and 100, as they were in subsequent years. They were about 72 when the dead-weight arrangement was entered into, and 74 in the April following. To have funded at such a price would at once have roused in wrath against government all the economical propensities of the supporters of the present resolutions. In 1824, again, the high price of stocks presented another difficulty; for, when stock was high, funding was ao easy operation, however desirous government might be to effect it, because the holders of Exchequer bills were then unwilling to part with them unless they received a premium. Moreover, it would have been most inconsistent to have attempted to fund a mass of Exchequer bills, at the same time when they were proposing to reduce the 4 per cents. The latter measure might have been a wise one, or it might not, but it would have been utterly impracticable in connection with the funding of Exchequer bills: it was necessary to relinquish the one measure or the other. Yet, even in 1824, government had been enabled, by the productiveness of the revenue, to pay off a large amount of deficiency bills.
The resolutions were negatived