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proportion. If you are gifted with this juste milieu, or exceed it in the more desirable half, your temper, with prescribed management, will become the ne plus ultra of amiability, and you will represent by this alone a capital of 50,000l. Thus :


"Natural Endowments






"I think I have now fully established the real property I mentioned, and I trust, my dear nephew, you possess and see it with the same eyes. It is a reality which no stretch of law can deprive you of. Borrowing. I could unfold much in this division of my treatise, but without fatiguing you with my own individual modes, I will give you a narration, too full of interest not to be recorded, and which, I will add, mutatis mutandis, gave me the idea of reducing my modes to a practical digest. It has been said, and is said, and must ever continue to be said, that loans are the most productive sources of credit. It was the loans of Mr. Pitt which raised this country to the state of prosperity which it now enjoys, and in France the loans of the Ministry have elevated the funds to God knows what! These two examples are sufficient to prove, as a primary principle in public and private affairs, that the best system of finance is founded on this axiom

"The more we borrow, the greater our credit."

Would you have other examples? look at Spain, which always has been, and always would be borrowing; Portugal is similarly disposed; Russia is always anxious for a loan, and Naples has no other dependence. What succeeds with a nation cannot fail with an individual; and the truth of this is evident from the facts I am about to narrate, and which I know, from indisputable authority (my relation, Lord M.), gave to Pitt the idea of his celebrated scheme of finance.

"The memory of the interesting Schneider is still green in the valleys of Switzerland. I will relate the tale, if it be only to remove the last few scruples in your breast (if indeed any remain) regarding loans.

"Schneider was an inhabitant of the Canton of Underwald, and descended from a good Swiss family. His father had been very forward in opposing the oligarchies of certain Cantons. This man, a born democrat, asserted that the Helvetic constitutions were perfect farces, and that it was not reasonable that the aristocracy of a small canton should exist beside the democracy of another. He wished to see the whole united in one, and that the laws, imposts, and rights of one should be common to all; and he dreamed of some grand project of levelling the mountains of Switzerland with the social contract of Jean Jacques Rousseau-but it was impracticable. He expended a great deal of money on his scheme and then died, leaving his only son but a volume on Constitutions, handsomely bound, gilt, and decorated with the arms of the different Cantons.


The son, thus disinherited by the democracy of his father, was

naturally well endowed and had been well educated: he had made a sort of education of the eyes, similar to that which I have above described. To this he united a delightful disposition, which was certainly worth the 100,000l. capital of the man comme il faut; but young Schneider had not this cash in his pocket. As, however, he had a name known and esteemed, he was welcomed at the best houses in the canton. Although it was vaguely reported that his father had left him no fortune, yet it was not for a moment suspected that all he inherited was the volume on Constitutions.

"The system of loans came as suddenly into the head of Schneider as did attraction to the brain of Newton; and with the holy zeal which is usually elicited by a new discovery, he proclaimed to the world that he wanted 2000 rix-dollars, for which he would pay interest at five per cent. and the principal in six months. This loan raised, his way was clear before him. His manners were so good, that a banker of his acquaintance, of the firm of Frey & Co. offered him the assistance he required; and he received in exchange from young Schneider two bills of the date agreed on, which he consigned to his pocket-book.

"Having achieved this sum, Schneider resolved to live honestly and honourably. He limited his expenses, and pretended to talk to all of his regulated way of life. He was thought amiable and trustworthy: his father, he said, had bequeathed him very little, but aided by some trifling negotiations he had in hand, he hoped to be able to make both ends meet at the end of the year. This modest and unassuming conduct was soon noticed, and in three months the youth was known throughout Underwald as the interesting Schneider.'

"However the bills were coming to maturity in the pocket-book of Frey; but two months before they were due, Schneider had received from another banker, the wealthy Freuler, spontaneous offers of service and money. He of course accepted them, having extended this loan to 3125 rix-dollars, which he thus disposed of:

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Total 3125

"Thus successful, Schneider considered himself henceforward (and his genius was not deceived) as master of the capitals of Switzerland; but his ambition did not reach to that height, he only desired to live with comfort and be useful to his country. Frey, the banker, had not the least uneasiness concerning Schneider's bills; but the youth was desirous of profiting by the two months which he had before him to place his credit upon a stable foundation, and to give it certain success. He went to Frey, and told him that five per cent. was a heavy interest to pay, and that if he could agree with M. Frey as to the immediate taking up of the bills, he would do so with pleasure, on having discount. Ah! ah! M. Schneider, you know business, I

see; nothing is so sure as discounting one's own paper-that is the true system of banking.'-' But if it at all interferes with your books—' Not at all; but I will accede on one condition only.'-' Name it.' -If you want money at any time, you must come to me for it.'— 'Agreed.'

"Schneider had played his cards adroitly; but he thought it prudent for some time to change his lenders, which he contrived very skilfully to manage, so as to extend his credit all over Switzerland. This took three years to effect, after which time he was compelled to refuse the offers of money made to him-upon principle. It will be understood, that during these three years he was actually 12,000 rixdollars in debt, exclusive of the interest at five per cent. But this was nothing his credit was established. He had limited his expenses to 4000 rix-dollars per annum; and if he lived sixty years, he calculated that Switzerland and he would be quits-at least, that his country would have paid him his debt of 460,000 rix-dollars, which, by the admirable tenor of his life, he would have returned to it with usury. In fact his conduct was exemplary. As a merchant (for he was one, as he had accounts open with all the first houses in Switzerland), his punctuality and exactness were extreme: he kept his own books, and by double entry. Every night he struck his balance, and carried his cash-box up into his bed-room. His bill-book was a model of precision and method. He held nothing more sacred than his signature, which was never protested. He made a rigid vow never to exceed his revenue by a stiver, and he kept his pledge sacredly. His probity also trembled at the idea of exceeding the little civil-list which he had drawn up for himself on his country. As a social and worthy man, he was quoted in the Canton. He had built a delightful villa, where he had a library, dining-room, parlour, and spare bed-rooms. All the skill of Swiss horticulture was displayed in his garden, to which belonged a small farm, whence he supplied his household wants. As a moral character, he did good to all around him; he established schools of agriculture and industry-a memorable example, and which two benefactors to Switzerland, Fellenberg and Owen, have since renewed with so much success. As a religious man, Schneider fulfilled all the duties of a Christian; and refunded in alms to the poor a portion of his capital, amounting to at least 4000 rix-dollars. Finally, as a political character, he made his exact returns of household; paid all due imposts; and at every public meeting, spoke conformably to the interests of the Canton, and voted according to his conscience. But Schneider did not conceal from himself, that his station as a man thus drawing on his country for his capital, carried on for fifty years, would occasion at his death a check to the national wealth of Switzerland; his honest heart was therefore occupied with devising means of producing it was not enough for his feelings that he left to his fellow-citizens a great example of the power of credit, he wished also to create, or improve, a branch of national industry, and for this purpose determined to travel. His attention was arrested by the Valley of Gruyères, and he remarked the beauty of the cows: he observed their independent lite in the midst of fat pastures; he inquired and learned from the herdsmen of Bulle that the herbage of Gruyères so aided the udder of the cows, that they produced six times the usual quanti

ties of milk. He saw that their products varied with the seasons; that in spring they would yield twenty-four pints of milk each cow, twelve in summer and six in autumn; whilst fitting economy suggested that he should forbear to milk during the three months of winter. Schneider undertook the management of a flock, and from his abundant supplies conceived the glorious thought of that celebrated cheese, which the Old and New World now consume with delight under the distinguished appellation of Gruyères cheese. Soon herdsmen and cattle filled the fertile vale, and making cheeses occupied all the inhabitants. Thus did Schneider pay his debt to his country, or rather was entitled to draw upon it for a double, or even triple capital; and thus, too, he rendered the universe tributary to a humble valley

of Switzerland !

"Ought he now to have felt a shadow of a shade of a scruple of drawing on his country for his allowance of 4000 rix-dollars annually? Assuredly not. Thus then the excellent Schneider saw his end and bankruptcy approach without perturbation. As he died with a clear and unsullied conscience, he was desirous of declaring with his own lips his honourable failure, and not leaving to the syndic the care of calling his creditors together. He employed the last days of his exemplary life in putting his house and cash-books in order; and having cast up all his accounts and adjusted his balances, he found that he owed 389,722 rix dollars, inclusive of interest for fifty years, and his creditors were upwards of three hundred. He assembled them on the 4th of January 1720. They were ignorant of Schneider's intentions, but such was their regard for, and confidence in, this excellent person, that not one of them was absent from the convocation. Schneider was conveyed in his bed to his hall: his bill book on his left hand, his cash journal on his right; and a ledger before him. His creditors being all assembled, he began by apologizing for the weakness of his voice, which no longer allowed him to be heard as distinctly as he could wish: he then endeavoured to collect himself, and spake in the following words: Gentlemen, the great book of life is about to close on me; my account current has been open for upwards of seventy years. It is not for me to settle the balance of that debt; that is reserved for the Most High, who keeps the register of our actions. I behold him already prepared to make terrible additions to the immense sum already entered, and I tremble to learn the amount of the debt which will be made out against me.' (At this touching exordium, upwards of 300 pocket handkerchiefs were extracted from upwards of 300 pockets, and applied to twice as many tears flowing from twice as many eyes.) The old man continued: If I cannot arrange my account with my Maker, he has at least left me the courage and strength necessary to settle with each of you. This is my entry book: you see it is arranged alphabetically: it corresponds with the folios of my ledger beside it, which is methodised according to the customs of business, and in which each of you will find the sum due to him,' (fresh tears, great sighs and groans.) You would be wrong, gentlemen, if you thought that, as in usual balances, there was an active and a passive balance,' (a movement of attention); 'in that case it would be only an inventory similar to those you have so


frequently seen, when the credits and debits are struck out to leave the surplus to direct or indirect heirs. Alas! I have only to offer you a passive balance.' (Motion of surprise.) Do not expect to receive thirty per cent., twenty per cent., ten per cent. of what is due to you; you will receive nothing-positively nothing.' (Expressions of amazement amongst the 300 and upwards.)

66 6

My father the democrat left me nothing but a volume of Constitutions; yet I had to live-it was necessary. I conceived the great idea of credit. I discovered that it was founded on the fidelity of paying arrears. I have been a proof of the justice of this fact. If you have the least doubt of it, I beg of you to cast your eyes over my accounts, in which I defy any one to detect the slightest error. I am at a loss to know which you will most admire, my discovery or my moderation, when you reflect that I could have drawn on all the capitals of Switzerland, and that by my exactitude in paying up the interests which I drew from your chests, I could easily have enlarged my bankruptcy to twenty times its present amount. You may assure yourselves that it does not exceed 389,722 rix dollars, of which, thanks to my skilful administration, the division is in nearly equal proportions amongst you. I made it my duty up to these my last moments so to manage my loans, that at this hour the sum borrowed is from as many as possible, and they the richest of the land. And what, let me inquire, my creditors, is this loss when compared with the admirable system of finance which you will now be able to present to your Country? I, wretched mortal, am condemned to be a bankrupt; but our Country dies not, and its immortality will solve the sublime problem of credit! Yes, gentlemen, a country may borrow on indefinitely, because it lives on to an indefinite period. Let Switzerland pay the precise interest of her debts, and then there is no reason why she should not some day absorb all the capitals of the world. Can you think that any one of you would have paid too dearly for this discovery even by a million of rix dollars? You may see that by this an inexhaustible source of prosperity is open to peaceful Helvetia, by my example, and it would be ridiculous to talk to you of my Gruyères cheeses. Were I to expatiate upon the good I have done, I know that I should end by proving that you are all my debtors, and I prefer separating from you with the soothing idea that we are quits in the fullest extent of the word. I have served as an example to the rich; I have aided the poor. I have only moved some of your immense and torpid capitals to introduce them into channels in which they may find full occupation. I have begun the levelling those mountains of gold which it has pleased fortune to surround us withal. She was blind, and I, to use a characteristic expression, have performed on her the operation for the cataract.'

"This discourse, so unexpected, produced in the minds of the assembled creditors sentiments of ecstasy and admiration. Each merchant, as a token of respect and gratitude, deposited at the foot of Schneider's bed the last bills which that worthy citizen had accepted; he offered a pen, and each signed his acquittance. After putting all these bills in a packet, he raised them in his hands as if to show them to the world, and yielded his last breath, crying-Com

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