The Press. — London, England, 1854-05-27 00:00:00

rott6ings zn V artianunt. MINISTERIAL FINANCE. Monday was appointed for Mr. Gladstone's re entrance to Parliament after his temporary seclusion, and that day was accordingly fixed upon for the dis cussion of those borrowing schemes for which, after various contrivances and abortive efforts to obtain confidence among the capitalist classes on his own responsibility, the Chancellor of the Exchequer now sought to obtain a legislative authentication, under the title of Exchequer Bonds. Mr. T. Baring had proposed, by way of preliminary amendment on the whole project, a resolution declaring that "it was not expedient to authorise at present any further issues of Exchequer Bonds, with the engagement of repayment within the next six years." Some diff.- culty had, however, supervened, and the hon. mover was placed in an unfavourable position, of which he not unjustly complained, by the proceedings that had taken place during Mr. Gladstone's absence. Certain votes had then been taken, as matters of convenience, which so hampered the house that he was unable to move his amendment in a substantive form, in opposition to the motion for the Speaker leaving the chair, but was forced to bring it on in a subordinate character, as an amendment on the reso lution in committee. The house having thereupon resolved itself into committee of ways and means, some ,expostulations and explanations were interchanged on this sub ject : The CHANCELLOR of the EXCHEQUER explained the situ ation in which previous votes of the house had left the financial arrangements of the Government. Those ar rangements were twofold—first, as relating to the perma nent provision of revenue for the public service; secondly, with regard to the supply of cash for immediate purposes. Decisive votes had been passed authorising the expendi ture of money, and formal votes indicating the ways and means by which it was to be raised. He had now to take the opinion of the house on the single question how the ready money that was wanted should be obtained ; and this question, he intimated, turned simply upon the nar rower alternative whether it was most expedient to resort to an issue of Exchequer Bills, or authenticate the Minis terial project of Exchequer Bonds. Mr. DISRAELI charged the Ministry with sharp practice. They had asked for certain votes on the plea of adminis trative convenience, and under the pledge that the decision of the house was in no way committed upon the principle of the measure; and now those votes were accounted deci sive, and the house barred from the possibility of rescind ing or even of discussing them. The CHANCELLOR of the EXCHEQUER explained. The resolutions in question were wanted—as to the provision of ways and means in order to authorise the revenue offi cers to take steps for levying the enhanced imposts; and, with regard to the floating debt, in order to validate the contracts already opened with subscribers to the new bonds. Ample opportunity, he added, would be afforded for dis cussing the principles involved in these resolutions when the bills into which they must be embodied came before the house. Some further complaints were urged and explana tions offered on this point. At length the resolution empowering the Government to issue 2,000,0001. of Exchequer Bonds was put from the chair. Mr. T. BARING then rose to move his amendment. He began by min , itely reviewing the dealings of the Chancellor of the Exchequer since he firsttook office with th., funded and unfunded debt of the country, and charged him with making many blunders which entan gled the public revenue in repeated losses and embar rassments. Among other mischances was the impru dent reduction of the interest on Exchequer Bills, undertaken in the face of a tightened market, bols tered up by extensive purchases with the savings banks balances, and resulting, when these purchases were again funded, in a sacrifice of more than 1,200,0001. added to the permanent capital of the national debt. Another blunder was the celebrated conversion scheme of the Chancellor of the Exche quer:— "It was preposterous to assert that no lose had accrued from that project. How was it possible to pay off at par stocks worth only 83 per cent. without incurring a serious loss ? Some of the money might have been paid out of the Treasury balances, but the result was identical, seeing that now we had to borrow it over again in a depreciated market. With regard to the future system of policy he would not argue the question on the exclusive interests of the Bank of England, remarking only that the interests of that establishment and the Finance Minister were prac tically identical." Mr. Baring then alluded to the ' balance' question, contending for the expediency of maintaining a considerable balan e of public money in the hands of the Bank, and declaring that the system of deficiency bills was unsound and impolitic, and that, while the Bank was fet tered by the act of 11444, the Government ought to be mo derate in their calls upon its resources. Adverting to the resolution immediately before them, Mr. Baring remarked upon the danger of borrowing money at short dates, under a pledge of repayment at given periods, which it might be most inconve nient and expensive to redeem when the time came. The transaction now suggested was actually a loan, and should have been boldly announced as such, and THE PRESS. contracted upon the most advantageous conditions. The circumstances under which the proposed Exche quer Bonds were to be issued fell, as he contended, far short of that point. He then defended the great capitalist class of the country, who were, he said, neither so formidable nor so useless as Mr. Glad stone represented them to be. In conclusion he warned the Government not to weaken public credit by the repeated trial of such abortive experiments, reminding them that a financial failure was a national misfortune. Mr. WirsoN embarked upon a multiplicity of details in order to justify the conduct of the Finance Minis ter. Mr. Baring's speech, he declared, was full of fal lacious statements, to which he proceeded to offer counter•statements on his own authority. Passing on to the immediate question, he argued that the choice now before them lay between paying for the war expenses out of revenue, or raising it by loan. Arguing in favour of the former alternative, he ad verted to the lesson derived from the experience of Mr. Pitt, contending that, if the taxes easily levied towards the close of the last war had been raised from the beginning, no addition would have been necessary to the national debt during the whole period from 1793 to 1815, when, in fact., more than six hundred millions of debt were incurred. He then examined the special characteristics of the pro posed Exchequer Bonds, and pointed out many ad vantages and conveniences which, as he alleged, they possessed as the medium for obtaining supplies of ready money. Urging many considerations in favour of these new securities, Mr. Wilson earnestly warned the Legislature against two great errors—enhancing the permanent debt, or tampering with the currency. Mr. MALINS exposed and denounced the financial blunders of the Minister, enumerating the enormous losses and damages which they had inflicted upon the public. The proposition now offered to the com mittee, and which was at last admitted to be a loan, comprised a sum of six millions, borrowed at four per cent., in order to replace a paid-off three per cent loan, thus involving a sacrifice of 60,0001. a year revenue, with a prospective loss of perhaps 600,0001. when the time came for paying them off at Par. Mr. LAING contended that the amendment was introduced merely as a peg whereon to hang an im peachment of Mr. Gladstone's policy. He could not assent to any such vote cf want of confidence. He then encouraged the house in anticipating success to the new Exchequer Bonds, by setting forth the example of the railway companies. Seventy millions sterling were now under loan to those companies upon similar securities, the money being always obtained upon them with the utmost ease and on most advantageous terms. The hon. member pro ceeded to give a resume of the monetary history of the past twelve months, defending the Chancellor of the Exchequer, whose experiments, he said, were judiciously designed, if not always successful. Mr. CAIRNS controverted the assumption that the cost of the war should be defrayed out of current revenue. The individuals composing the tax-paying body were constantly changing, and it was unfair to throw upon one set, namely, the taxpayers of the present year, the whole burden of a contest from which another set were to enjoy the benefit. The injustice of calling on the present contributors to pay the whole charge would be doubled by the method in which it wag to be paid, namely, the un just and impolitic income tax. Mr. MAC GitEmin considered that the Chancellor of the Exchequer had been unjustly and unreasonably attacked. Mr. T. HANKEY believed that the proposed plan for raising money was business •like and expedient, and hoped that the committee would not, by accepting the amendment, cripple the hands of the Government in carrying it out. Mr. DISRAELI could not treat the question before them as merely one of detail. It grew out of the general principles on which the present Chancellor of the Exchequer had managed the public finances. Those principles he considered to have been erroneous from the beginning, and enumerated in detail the succession in which error had followed error throughout the whole course of the year 1853 : " The first was the reduction of interest on Exchequer Bills, the effect of which was now at length understood in the withdrawal of the balances in the Exchequer. The second great mistake committed by the right hon. gentle man was the celebrated scheme of conversion of 1853, which was founded upon fallacious and contradictory cal enlations. The first was an improper tampering with the unfunded—the second with the funded debt. When they were at that time discussing their financial measures, lion. gentlemen on the Opposition side were ignorant of a very important element in their consideration, for they were not then aware, as they were now, that at that very time the right hon. gentleman knew that a war with Russia was impending. Even in their ignorance of this impending war, they had warned the Chancellor of the Exchequer of the errors of the course he was pursuing; but had the house known, as the Government did, that there was more than the chance of war impending, they would hardly have agreed to the ,propositions he had made. A third great SATURDAY, t . error, and the greatest which a statesman could commii., was, that with the knowledge of an impending war h e had proposed a peace budget—a budget which not only repealed taxes, but which was founded upon the further repeal of other taxes. The right hon. gentleman, whichknowing itu o e by %h t e h t he wasft w o in g d h onl y country was on the eve of war, had, nevertheless, p roposed therenewal i o n f at te a a income coni gi e vetime, tax n with conditions do by a continuance of peace. A peace budget at such a time could only be considered as a very great blunder. It was the opinion of the late Government that there should have difference been a difference in the mode of assessment to the i ncome tax ; and he had heard nothing to convince him th at any details could the o f assessmentsreilder it impossible a p to make a d permanent between income. A fourth error committed by Mr. Gladstone was the reduction of the rate of interest, which caused him to withdraw 8,000,0001. of the balances in the Exchequer ; and he committed yet a fifth error by tampering with the fum of the savings banks, which amounted to a species of gambling in them. A sixth great error was committed in August, 16.53, in not having tilled his Exchequer when the opportunity presented itself for doing so." Out of these blunders, Mr. Disraeli argued, our pre sent difficulties had sprung. Passing on to the finance questions of the current year, he remarked upon the conflicting statements made in successive budgets, which he characterised as being to a great extent inaccurate and deceptive. Fallacious estimates were given of the costs of war, and delusive announce ments hazarded regarding the aids that would be re quired to meet the growing charges upon the revenue. At last a succession of mismanagement had culmi nated in the necessity for a loan of six millions ; and this loan in its turn was so mismanaged that the Chancellor of the Exchequer had offered four per cent. for the money, and yet could not get it. He had shown himself incompetent to deal with the bulls and bears, and had been forced to appeal to the stags of the Stock Exchange. And now came a last shift for raising a loan in masquerade : " Nobody objected to her Majesty's Ministers asking for 6,000,0001. or 12,000,0001. if they thought that the interest and honour of the country required them ; but that of which we complain is that the Minister of Finance, who had been called upon to investigate great questions that affected the country—who must have necessarily and naturally have placed himself in connection with his colleagues at the head of the various departments—bad made estimates on the sth of March which, during the interval of the boll. days, were found to be erroneous to the amount of 6,000,0004, sterling. (Cheers.) We now have the consequences of these continuous and systematic errors in the administra tion of our finance—namely, an attempt by the Govern• ment to raise a loan—for such I must still style it until I am better informed of the object and proceedings of her Majesty's Treasury. This attempt was accompanied by some of the most remarkable circumstances that have ac• companied financial transactions of this kind made by an English Minister—the Chancellor of the Exchequer of England at a time of unrivalled prosperity, at a time of un• exampled wealth—the country engaged in war, with all their feelings enlisted on behalf of their Sovereign and those who wielded authoritywith respect to this important event-- suddenly appears in the market to borrow 6,004)pool. at four per cent., and is absolutely unable to raise the funds which he requires. (Hear. hear.) What the Emperor of Russia must have thought of the business it is impossi ble for me to ascertain, but I certainly think he would put it down as a countervailing incident to the bombardment of Odessa. (` Hear,' and laughter.) It is a mystery to men of business as to how the right hon. gentleman could have managed so as to have brought his enterprise to such a ruinous conclusion. In that wild desert the city of London inhabited by—l will not say savage beasts, though there are some balls among them and the rest are bears—in the city the Chancellor of the Exchequer is supposed to hare some knowledge of these animals, but the right hon. gentle• man would not content himself with bulls and bears, but aimed at higher prey, and it was sought to bring down the antlered monarch of the forest and all the stags of London to contribute to maintain the credit of the Exchequer. (` Hear, hear,' and a laugh.) The right hon. gentleman was under the necessity of striking out 200,000 or 3u0,0 0 0 of the subscriptions on which no instalment was paid. This mismanagement of the finance, though slight, was the occasion of a great deal of public scandal, and does no good to the public credit. I speak not from hearsay, for, through unknown contributors, I have documents in my possescoa —letters from three persons, most obscure, penniless varlets, all subscribing 5,000/. of Exchequer Bonds. (Laughter.) It is a striking thing that these fellows with• out a roof not only subscribe for 115,0001. of the Exchequ er, for 5 , 0001 . of each of the series, but they received an of fi cial answer. What was the reply to them ? That the co t ha t. went would grant their request? Much more than tta The reply was not only granting the request, but beggi ng , r as a particular favour to the Government, that they would take the whole of the subscription for the series A, ant that by doing so they should enjoy all the advantages .ti!. privileges which they might obtain from se ri es ( d laugh.) The Chancellor of the Excheq uer, with tt!sif array of phrases which he has at command , may pre a that this scheme equals the Loyalty Loan of Mr. Pitt, w_ hom he so much admires, but I think that all aoqunit.ted wit h the subject must have felt annoyed that the Iressury_ o of r England should be placed in so r idiculous a posinco.L cir to not only could the right hon. gentleman not raise b ,000,tam• at four per cent., but he absolutely gave occasion mr. cumstances which make the public function aries temptible in the eyes of the country. WhoWo tdd have supposed, when we listened to the right hon. gentleman as he touched upon these matter s an indignant spirit of self•defence, that he_ . , n ., 1 1 been in correspondence with all the stags of L°11 """ .