which you will of course have to consider.

There are certain difficulties introduced into this part of the subject by a particular school of reasoners; but the distinction is sufficiently sound for our present purpose, and for all intelligible purposes. I shall proceed upon it.

Suppose we were all soldiers and sailors, i. e. nonproductive labourers, there would evidently be no one to feed and clothe us. To this preposterous state of ruin we therefore approach, the more soldiers and sailors we raise. The money that is given to them, and for them, is only the medium by means of which food and clothing, arms and accoutrements, are transferred to them from those who produce these articles. It is not meant to say that soldiers and sailors are useless, for they defend us; or that they deserve not what they receive, for they receive but little. All that is urged is, that they can produce nothing themselves, and that they must necessarily consume part of the produce of those who do; and that consequently, the more of them we are obliged to maintain for any purpose, whether of offence or defence, the poorer we shall be, and the less able to become rich. It is not therefore true, that because the money is paid away to our soldiers, sailors, public officers, &c., and never goes out of the island, that therefore we are not the poorer. And in the former case, that of subsidies, loans, &c., when the money obviously does go out of the island, then indeed it is allowed by all, that we are poorer.

In these two cases, therefore, the matter is clear, and I shall dismiss them.

Still some further explanation must be given of the manner in which we bear our extraordinary loads of taxation. Certainly there must be some truth in the popular notion, however

vague, that the money raised by taxes never goes out of the kingdom, and that therefore we are not poorer.

I must, therefore, now propose to your thoughts a distinction which you must recollect; it is this: the money originally lent from time to time by different monied men to government, is always to be carefully set apart in your minds from the money that is afterwards paid every year by the nation as the interest of it. The money originally lent, which the funds are the records of, is money that has been taken from the capital

of the country; all this is, therefore, positive loss; it has been spent; the soldier and his ammunition, the sailor and his ship of war, have at length disappeared and are annihilated. These were what the money produced; they are gone. The money has been spent, therefore; we have it not: and if it had not been so spent, we should have had it; it would have been left in society to be added to our capital, and thus left to increase our means of production or gratification. Here is, therefore, a distinct loss, continually measured and exhibited by the amount of the national debt, The only good that remains is the existence and affluence of those manufacturers that have been employed in furnishing our soldiers and sailors with their food, clothing, and implements of war; all the rest is loss. But the same cannot be said of the interest that is every year paid in consequence of it.

You must now consider by whom this interest is paid, and to whom.

It is paid more or less by every man in the kingdom to the annuitants or shareholders who originally lent the principal, The interest, then, is paid by one part of society to another part of the same society. We have not here an annihilation and total destruction of any thing purchased, as in the former case. The money is not spent in soldiers and sailors, in gunpowder and implements of war, in provisions for their support in foreign countries; it is not spent on objects which immediately perish without producing any thing but our defence. The money is now given by society to certain annuitants, and this money may be said not to travel out of the island, and in that sense not to make us poorer. The very annuitants themselves pay their full share to the taxes, i. e. they themselves pay a part of that money which they are afterwards themselves again to receive back as their interest; receive in their dividends at the Bank.

All this is true, and may contribute to explain to you the manner in which we pay so much every year, and yet survive our expenses.

But you are by no means to suppose that the quantity of our taxation is a matter of little or no consequence. You are not to conceive, as is generally done, that because the interest does not go out of the island, that it is, therefore, of no

consequence how much is drawn from the public. It is still a matter of great importance what quantity of money is every year levied; for, to drop for the present our former language of productive and unproductive labourers, and to adopt language of the most ordinary nature,-What is the case before us? The money is taken from one person and given to another. Now I may take the money from one person and give it to another, and the money may never go out of the island; but it is of great consequence who is the person I take it from, and who is the person I give it to. The person I take it from, may, and indeed must be, in the main, one who lives by his industry; I must be, therefore, very careful what I take from him, though I give it to his neighbour and fellow-citizen; for otherwise I may materially affect his prosperity—that is, as he is an industrious man, the prosperity of the country.

The quantity taken is a most material point. I may require from him so much, that I may injure, dispirit, distress, and at length ruin him; and all this, though the money never goes out of the island, and is only paid from one to another.

This leads me to say one word on the subject of taxes.

The most useful observation which I can make to you is this: that all taxes are paid by men out of their income; and, therefore, whether a person be a rich man or a poor man, but more especially in the latter case, his situation may be made, by taxation, to vary downwards from cheerfulness and affluence to uncomfortableness and privations, then to penury and ill-humour, and at last to wretchedness and sedition.

A system of taxation may be prevented, by different causes, from visibly producing these very ruinous effects; but it always tends to produce them, and always does produce injury to a certain extent. Though its full operation be concealed, the weight is not the less in one scale because it is overbalanced by opposing weights in the other. The prosperity of a nation under a great system of taxation may be very striking and very progressive, yet that progress is not, in the mean time, the less restrained and retarded by the secret operation of the load which it drags after it.

But to conclude: as you read the history from the Revo

lution, you will indeed see the national debt continually increasing; and you will observe, in the debates in parliament, repeated prophecies that the debt must soon destroy us, that the practice of borrowing cannot go on, that the taxes are already intolerable, &c. &c.

As no such effect has taken place, you may be tempted to despise all such prophecies and their authors, and will then have to despise the first patriots and statesmen which our country has produced, and such a writer on political economy, as Hume.

You will therefore observe, that, in the first place, it is the monied interest who lend money to a government-those who have money, for which they are satisfied to receive no more than the interest. This description of men, if I may use so violent a metaphor, is continually from time to time thrown off from the great circulating wheel of the national prosperity-of the national prosperity, you will observe; and, therefore, if the national prosperity declines, they will not be found.

In the second place, you will observe that it is from the produce of the land and labour of the community that the interest is to be paid. This interest, therefore, depends also upon the prosperity of the country. If therefore, as before, that prosperity declines, the interest cannot be paid as it has been before, not without greater injury and distress.

It happens that the prosperity of England since the Revolution has never ceased to be progressive, and this for many reasons which could not have been foreseen, and therefore to an extent which could not have been expected. Loans on this account have been continually made, and the interest continually paid. Yet neither are our statesmen nor our philosophers to be accused of mistaken principles. It does not follow, because a loan was made last year, that it can be made this year, nor the contrary. The whole is a question of prosperity, and therefore not a little of mere fact and experiment at the time when the loan is wanted, and the interest to be paid; whether there exist at the time those who have money to lend, whether they have arisen in society in consequence of their successful industry; and again, whether there exist a sufficient number of individuals in society who can

pay fresh taxes out of their income, that is, whether the new interest wanted can be paid.

The canker, however, of a state is taxation. We may remember, therefore, what Swift says to those who were continually looking for his death :

"My good companions, never fear,

For though you may mistake a year,
Though your prognostics run too fast,
They must be verified at last."

And if Hume were still alive (who is always referred to as a false prophet), he would probably not be induced, by any thing that has happened since he wrote, either in France or this country, to withdraw his observation, his sally of melancholy pleasantry, "That princes and states, fighting and quarreling amidst their debts, funds, and public mortgages, reminded him of nothing but a match of cudgel-playing fought in a china-shop."

At the close of the late lecture, we arrived, as I have observed, at the accession of George III. to the throne, and at the unexpected dismission of the great war minister, Mr. Pitt, to make room for a nobleman at that time far less known either in Europe or in England, the Earl of Bute.

The reign has been in part written by Mr. Adolphus, I am given to understand, upon much better sources of information than any other writer has yet enjoyed. No reign can be properly written till the sovereign is no more, and it is possible that important materials for the future historian will hereafter be produced; but in the mean time the history of Adolphus will naturally be received into your studies, and must be mentioned and even recommended by me; and it therefore became my duty to direct my own perusal to this history, and ascer tain whether it was necessary to accompany my recommendation with any particular remarks.

I had not proceeded far, before I met with the paragraph which I shall now read to you. You will be so good as to mark well every word it contains. You will find it a solution of all the material phenomena relative to cabinets and ministers that have distinguished this memorable reign. The passage in Adolphus is this: