have observed my notions of those evils and their remedy, as they appeared in the Political Register of March 21st, May 30th, and June 6th, you will perceive that my opposi tion to your bill, is not founded upon a belief that instruction is not a boon to those who receive it, but on conviction that it is not the best buon which the people can receive in the present embarrassed circumstances of their pecuniary affairs. On the contrary, I have gone farther in defence of education than fact, I am now willing to be lieve, can bear me out; namely, that none could oppose its progress, but those who wished to monopolise the advantages which knowledge gives over ignorance. I know now that I had then judged harshly. Mr. Wm. Randall, 204, High Holborn, whose inestimable " Warning Voice," I hope you have, by this time, got by heart, opposes the education of the poor upon a ground which all the sufferings I have seen or felt throughout life never suggested to me; namely, that it makes the pains of political oppression more poignant than otherwise they would be. I grant it; Hament it; and I would prevent it if I could. But, when we consider the advantages of education, in surmounting all the surmountable evils of this life, or in teaching us resignation under them when they cannot be surmounted, do I labour under an error in holding, that its advantages far outbalance its evils? But, to return. Though "man wants but little "here, and not that little long," still my feelings tell me that food, raiment, and ease sufficient to support health and prolong life, is the best boon which the people can receive; my eyes inform me that a real want of these is the great first cause of complaint with the poor; and I am convinced by my reason, that were they to receive university education, it would not enable them to preserve for their own use a single grain weight of the food and raiment, which the taxgatherers by virtue of law; the monopolizers, by virtue of their right to do as they please with their own property; and the idlers, in virtue of custom, pull out of their mouths and tear from off their backs. Nay, that, if it could enable them to create more of both, it could not enable them to consume more of either, because the cravings of these their devourers are insatiable. On the principle, however, that there are more ways than one of doing a thing, 1 may be mistaken. Education, it is true, enables the poor to understand better their own rights and duties, and as they see these more clearly, so they are more disposed to revert to the constitution. If you mean, Sir, instruc

tion to be the best boon, as it tends to produce this effect, I have to beg your pardon for all I have said, or may say, in opposition to your bill, for, I believe you are correct. But, then, we are as far apart otherwise as ever. I disagree with you completely as to the application of the boon, in this round about way of coming at the object, because I prefer infinitely, that government should straitforwardly revert to the constitution, than that the people, by any means, should do it themselves, in opposition to the government. The people can do it; but, I would prefer that it should be done by their rulers, because the people generally wade through a great deal of misery before they accomplish their object themselves. The history of the world proves, indeed, that these miseries can lose their terrors, and that death in any other shape is better than that of dying by inches in hopeless expectations. When government, then, does that which requires nothing to do it with but the will; when taxation, monopoly, and idleness are brought down, by the gentle and parental hand of law to that level which will leave the necessary portion of food, raiment, and ease within the reach of industry; then instruct the people, and for the best of all possible purposes; namely, to enable them to guard by every possible means against the future return of these great causes of their wretchedness, misery, and vice. Suspicions, Sir, as your views may appear from your opposition to Sir Francis Burdett, and the cir cumstance of your having neglected to bring forward your motion for an inquiry into the state of the nation while your party were ministers, and therefore, could carry any measure in parliament it is generally thought, at least said; (still I am unwilling to believe that you are guilty of double dealing on the subject of the poor;) that your object is popularity on the hollow basis of public delasion; that the advantages of monopoly which completely shields you against the disadvantages of taxation warp your judgment, steel your heart, and blind your eyes to their effect upon the condition of the poor; but it confounds me, and all those, with me, who think seriously upon the subjects of evils and their remedy, that any man who is qualified to legislate for a nation should think of sending the children to school, as a remedy for the evils of taxation, &c. &c. while these very evils deprive the parents of power to supply them with a whole breakfast, of the coarsest of food, before they go out in the morning; or, that he should hold out no prospect of relief for the parents until the education of the children

removes those evils which do not arise from their want of instruction; but from causes over which their learning can have no controul. Is it possible, Sir, that the people can mistake these to be the principles of your plan? If it is not, depend upon it, Sir, that if, in their unguarded moments they should give you any credit for virtue and talents, it will be but of a short duration should you succeed in your scheme. Therefore, if you be truly anxious to live and die in public esteem; if you be really serious in your desire to mend the manners of the lower classes of the people, at general elections, and every where else, you must remove those evils which learning cannot reach, and enable them to eat and drink before you learn them to read and write.-C. S.-July, 13, 1807.

NEW FINANCE PLAN.

SIR, -Parliament being again assemled, and the subject of the public Finances about to come under its consideration, you will probably think some observations on the New Plan of Finance by lord Henry Petty not altogether out of season. In submitting the following remarks to you for publication in your Register, my chief object is to put the merits of the proposed Plan in a different and more familiar light than any in which, hitherto, it has been viewed: for, although many have disapproved of the new system, and although the result of different calculations (lord Henry Petty's own as well as lord Castlereagh's) appear to me to justify the fullest measure of disapprobation, yet no calculations, which I have met with, have aimed at precisely pointing out, wherein the principle of the new system is objectionable. This, however, I think highly expedient to be done, in order that we may trace, step by step, the action of the principle of this scheme to its ultimate, as I conceive, necessarily ruinous effects.-I ought, perhaps, to observe to you, that our political opinions are not in every respect the same, particularly as to the general merits of the late administration; and that, on this very question, the principle which I mean to insist upon as shewing the ruinous nature of the new plan, is the reverse of that on which you appeared once partially to approve of it, "because "for three blessed years," we were promised no increase of taxation. It is, Sir, because a country, opposed to an enemy so powerful as ours, must keep on foot a proportionate military establishment, which cannot be maintained but by the produce of commensurate taxation; because the pro

duce of the present taxes in England, how enormous soever they may be, is short of the actual expenditure of the country, and to shrink from raising the actual expenditure within the year leads to the inevitable necessity of laying on heavier taxes in the end; and because the new plan of lord Henry Petty does not extend, or act up to what was already adopted of the principle of raising the supplies within the year, but falls back from raising even the interest of the expenditure (for it takes only the interest of the interest ;) it is for these reasons, that I consider the Plan, as a temporary expedient by no means to be recurred to, and as a permanent system, speedily destructive. Whatever room my exist for reform in the expenditure of the public money, (and on the necessity of reform I go with your to the full extent of all your reasonings) no man can be sanguine enough to suppose, that, with our existing military and naval establishments undiminished, a sum of 11 millions annually could be saved, so as to render further taxes or loans unnecessary. It is plain that 11 millions yearly, of additional taxes, or loans, are required to complete our actual expenditure, and if our necessary expenditure be not short of our actual expenditure by 11 millions, it is evident, that to raise within the year our necessary expen-. diture calls for additional taxation.Now, Sir, I would make some observations on the pure Funding System; I speak in contradistinction to the system of raising one per cent. to create a Sinking Fund, and the new Plan of lord Henry Petty. The pure funding. system, it is well known, consists, not in raising the supplies of the year in taxes, but in borrowing the supplies, and levying taxes only for payment of interest of the sum borrowed This practice is professedly adopted for avoiding the e-ils of taxation. But what are ultimately its necesssary consequences? Let us suppose a country perfectly free from debt, whose annual ex; enditure is 20 millions, and that it adopts he funding system in its full extent, and borrows at a fair average interest of 5 per

cent.

It is manifest that, in a period of 20 years, the taxes levied for payment of interest will be 20 millions, or equal to the whole expenditure, while the supply of the 21st year will remain wholly to be provided for. In 40 years on the adoption of the system, the taxes levied for payment of interest will amount to 40 millions, or double the annual expenditure, while the supply of the 41st year will remain wholly to be provided for: and these will have been the consequence of a system adopted for avoid

ing the evils of taxation. It is clear, that for a country to have persevered in such a system 20 years, its power of yearly contribution, that is to say of raising taxes, sapposing it to have continued the same during the whole period, must have been originally equal to the whole yearly expen diture; to have persevered in such a system 40 years, its power of contribution must have amounted to double its yearly expenditure; and to have persevered in it 60 years its power of contribution must have been treble the yearly expenditure. And, Sir, regarding these the immediate effects of funding, what shall not be said of a system, which by its direct operation, drains a country of its whole resources in 20 years, if in the beginning, its resources were equal to its expenditure; in 40 years, if in the beginning its resources were double its expenditure; and in 60 years, if in the beginning, its resources were treble its expenditure? These which are immediate and inevitable effects of funding are primâ facie evidence of its evils: if we should be told that funding directly or indirectly extends the national industry, and augments the sources of revenue, it will be sufficiently in time, to inquire, whether in fact it is attended with such benefits in a sufficient degree to compensate for the evils of its immediate operation, or with such benefits at all, when the arguments in support of the assertion shall have been advanced. Sir, correspondent with the effects which I have stated directly result from the funding system, are the consequences which we have witnessed to flow from its operation in England. Not, indeed, that in England, or that I know of in any country, has the system brought the government to so full a stop, to so complete an incapacity for all further exertion, as I have stated to be the natural issue of funding, when in any country it has been persisted in till its powers of life are exhausted, till the system, if I may so phrase it, dies of old age. But this does not prove that my propositions are unfounded, or that the life of the funding system can possibly be prolonged beyond the dates, which I have assigned to it under ascertained situations of a country with respect to its power of contribution. Though in England funding has been practised for many years, yet it has been with frequent, and formerly long intermissions. Large sums were paid off by a sinking fund in the time of Sir Robert Walpole. Besides, funding was never, till Mr. Pitt's war of the revolution, adopted to so great an extent as in that war. Another cause why it has been possible to act upon

it with intermissions to the extent which has really taken place, is that, within the last 40 years, extraordinary improvements hate been made in the productive powers of industry in various of the most important branches of manufactures, and in the formation of canals and other public undertakings; by means of which improvements the power of raising taxes has been greatly augmented. A further advantage also as to raising a nominally larger revenue has arisen out of the reduction of the real value of our coin. This has operated to render easy a nominal increase of taxation, because the possessor of the same quantity of real wealth as before has a larger sum of pounds and shillings; the owner of a bushel of wheat is worth 103. or 11s. instead of 6s. or 78., a journeyman mechanic earns perhaps 30s. instead of 20s. per week, and therefore, they can contribute more shillings or pounds than before, but only the same real value. But another consequence of the reduction in the value of money is, that those, who were stockholders before the reduction, receiving in payment of interest only the same number of pounds and shillings in truth receive smaller dividends than formerly. So was the pay to the soldiers and sailors of diminished value, till the late augmentations of pay. Now all these agents have assisted to prolong the possible duration of the funding system, either by increasing the power of raising taxes, or lessening the real amount of the contributions called for. All the foregoing causes have co-operated to preserve England from being, hitherto, rendered incapable of all exertion; but they do not shew, that as far as the system has operated, we have not evidence from the existing situation of our finances, that the consequences of funding are such as I have stated them to be. We now pay for the interest of debt incurred by funding about 28 millions. Let us direct

onr

attention to that period in which the system was most extensively acted upon, namely, the war of Mr. Pitt, and see how much of this sum grew out of funding during a given period of that war. From a Table marked B 3, accompanying Lord Henry Petty's Plan of Finance*, it appears that, in nine years from 1794 to 1803 both inclusive, "the money capital of debt created" was £212,564,745, the interest of which sum, supposing the average rate of interest actually paid (but it was more) to have been five per cent., is £10,628,237. Thus in

*See Cobbett's Parliamentary Debates, Vol. 8, Appendix.

nine years the English nation was burthened by the funding system with ten millions and a half of permanent taxes, beides other taxes to create and feed a 1 per cent. sinking fund in the capital borrowed; and seeing that funding has, in nine years, imposed and absorbed 10 millions and a half of taxes, the supporters of the system may perhaps admit, that, in 36 years, with the like race of expenditure and interest, funding would absorb 42 millions of permanent taxes. The consequences which would attend such an increase of taxation it is needless to insist upon; they would, however, be the immediate consequences of this not a speculative but an adopted system, and one which was really acted upon to the extent required towards such an augmentation of burthens for nine years. Let us keep in mind that the taxes already raised for payment of interest amount to 28 millions. We at present raise within the year towards the expenditure £27,700.000, namely land and malt £2,750,000, surplus of consolidated fund £3,500,000, lottery £450,000, and war taxes £21,000,000. Eleven millions, which make up the whole expenditure (being £38 700,000), are proposed to be raised by loans. From this statement the country, at the present moment, appears to be extricated more than two thirds out of the funding system, and the present operation of that system of course to be proportionally diminished. But, to put the effects of funding in the clearest point of view, let it this year and henceforward be acted upon for raising the whole of the supplies. The taxes in such case (bating the 28 millions for interest of the present debt) would for the current year be only £1,935,000; and how glorious a thing (might the advocates of funding urge) would be the repeal at one stroke of £25,765,000. taxes! which might be the case, supposing the loan of £38,700,000, to be negociated at 5 per cent interest. But following the plan 20 years, what would the taxes for interest of loans amount to, no part of the coming year's expenditure being provided for? why £38,700,000, and in 40 years to £77,400,000, whien could be demonstrated by a mere vulgar arithmetic school boy: and this sum added to our existing 23 millions of taxes for payment of interest would make the whole of the taxes levied on account of the national

debt in the fortieth year from the preseut time £105,400,000, the expenditure of the forty first year remaining to be provided for. Such would be the consequence of abandoning at the present moment the plan

of raising any part of the supplies within the year; this of course is to be understood, if funding could so long be persevered in, but which the sum itself shews would be an impossibility. I think no man will contend that the produce of the labour of this country could maintain the labourers and contribute £105,400,000 yearly to support others in idleness. For it is to be remembered, so far from the creditors of the government, the stockholders qua stockholders employing industry with their imaginary capital, that on the contrary, if their demands on the government be obstinately and absurdly called a part of the capital of the country, they necessarily keep so much of the capital of the country unemployed and wholly unproductive: because if the owner of £100,000 stock, is determined to employ his capital in some branch of productive labour, he can only so employ it by getting rid of his stock and converting it into money, but the £100.000 stock has only changed hands, the seller becomes master of so much real capital to be employed in a branch of productive industry, while the former owner of this capital is become a stockholder. But, Sir, it is the yearly produce of the national industry, which can alone permanently be taken for defraying the expences of each year; if more than the produce of the year be taken after the necessary fund of subsistance of the labourers is subtracted, the principal is broken in upon, and the annual produce of industry (the productiveness of labour continuing the same) is yearly diminishing, which is a diminution of the sources of revenue.-If the providing for the whole public exponditure by means of loans would lead to the foregoing results, the borrowing of 11 millions to defray so much of the expenditure would lead to similar results. If the interest of the loans of 11 millions should average 5 per cent. for 20 years from the present time, the taxes for payment of interest would be 11 millions and by going on at the same rate 40 years they would amount to 22 millions. Now, possibly, many may be found ready to acknowledge the unsoundness of principle and ruinous consequences of raising the whole supply of £38,700,000by loans, who will yet refuse to acknowledge raising eleven millions by loans to be equally unsound in principle and equally of ruinous consequence. If there be such men, supposing the power of additional contribution by the country equal to 11 millions annually, and to continue the same, they contend for the wisdom of a plan, which in the short period of 20 years shall exhaust and absorą

the whole power of additional contribution beyond the present taxes, and leave the country in the 21st year of its operation, altogether incapable of supplying interest of the sum to be borrowed in that year; and yet the country will be burthened with the same amount of taxes, which, if laid on at the present time, would defray the same expenditure for ever. Supposing the resources of the country not equal to the contribution of 11 millions additional taxes, but of 5 millions, that is a reason, why our establishments and consequent expenditure should be curtailed so much; and not a reason, why we should continue an expenditure and system of finance, which, in 10 years, would absorb the whole power of contribution, and, as to 11 millions of the expenditure, leave the country in the 11th year without the funds for payment of interest even. But supposing the resources of the country equal to the contribution of 22 millions of additional taxes, the levying of 11 millions at the present time would be so much the more easy; and although the interest of funding 11 millions yearly might be provided for 40 years, yet at that period taxes for payment of interest would be double the taxes required now to be imposed for defraying the same expenditure for ever. Of the fanding system I shall only further observe, that the radical evils such as I have described, have been in a small degree dimi nished since the year 1793 by the creating a sinking fund of one per cent. on most of the different loans negotiated since that period, but, in the mean time, and until the loans are redeemed, the weight of taxes is thereby aggravated. Having now, Sir, stated what I had to observe on the system of borrowing money, and merely laying on taxes for the payment of its interest, I shall proceed to consider what is the proposed principle of borrowing in the system of Lord Henry Petty, and wherein it differs from the former, and is more objectionable; and to trace its results as stated in Lord Henry Petty's and lord Castlereagh's Tables, from the operation of its vitious principle:

The

26,700,000 raised by the ordinary taxes towards the expenditure of the year, have been laid out of the case in the different tabies, and the expenditure taken to be £32,000,000. To complete this sum 11 millions are required over and above 21 millions war taxes. To compare the respective merits of the two modes of borrowing, all aid from expiring annuities and the established sinking fund should be laid out of the calculations; because, it is obvious, the resources which they afford are independent of the

terms of any future borrowing of money. They are funds which do or will compose a part of our property; and any question to be raised with respect to devoting them to the payment of interest of any loans, can relate only to the expediency of paying interest with those funds, and not to the advantage or disadvantage of the terms on which the money, whose interest they are proposed to pay, may have been borrowed. Every thing has been done in Lord Henry Petty's tables to make the machinery of his plan cumbrous and intricate, and thereby to encrease the difficulty of ascertaining what will be the real rate of interest paid for the sums raised. But, Sir, it appears that a given sum of money each year will be borrowed, the interest for which we are to provide out of the war taxes, together with another sum equal to the interest of the loan (supposing it to be 5 per cent., which I will assume for the sake of perspicuity) to operate as a sinking fund of the loan; but a further sum is to be borrowed; for what? to replace that taken from the war taxes. Why then, Sir, we may put the war taxes out of the case, as to the supposition of the war taxes paying the interest and furnishing a sinking fund for the loan, and consider the second sum which is borrowed, as borrowed to pay the interest and create a sinking fund of the first loan. Now for this suni interest is to be provided by means of taxes, that is to say, taxes are levied to pay the interest of the interest of the loan for the service of the year, and of a sum which is intended to operate as a sinking fund. What are the effects of this mode of borrowing? The loan is 12 millions, the interest for which at 5 per cent. is £600,000. I will keep the consideration of the interest and sinking fund separate. The first year the sum of £000,000 interest is borrowed, to pay the interest of which interest £30,000 taxes are imposed. In the 2d year another £600,000 is borrowed for payment of interest of the former year's loan, and £30,000 more of taxes are levied for payment of interest of the second £600,000. A third sum of £ 600,000 is borrowed the third year: for the same purpose, and a third sum of 230,000 taxes levied for payment of its interest; making in three years the sum paid or debt incurred for the interest of a loan of twelve millions to be £1,980,000, or £180,000 more than 5 per cent. In fourteen years £3,150,000 will have been paid. on account of interest over and above the common rate of 5 per cent., the whole sum paid or debt incurred being at that period £11,550,000. Supposing, at the expiration of 14 years, the practice of borrowing the in