Star. — London, England, 1813-03-26 00:00:00

were very great, but equally great were those which flowed from the unimpeached t.onour of the country. The measttre under consideration would compromise this honour ; f tith would be broken, if it were acqui esced in, with the pubic creditor; and his reliance on it, found , 0 be vain, would fasten an indelible stigma on the nation in ?client' ; and more especially on that Patliament which would have been the organ of its injustice. With .hose considerations before them, the House would perceive that they were not about to enter into a mere discussion of financial ar rangements, but one which was to decLle a great question of national justice and national policy.— There was another consideration, of a more contrac ted nature, certainly, than those upon *Well he had already insisted, but which would be found, never theless, to have much weight ; he would remind the House that the Sinking Fund, on which they were now desired to trench, was the proudest monument wh ch had been raised by Mr. Pitt to his own fair fame ; it was such both in the apprehension of his friends and that of his political enemies-'-to both these classes of persons he appealed. His friends he adjured by the respect they bore his memory—his political opponents by their love of justice and of their country, to unite with every energy for the preservation of a plan pregnant with public advantage in all that sym metry and just proportion which had characterised it when it proceeded from the hands of its immortal author. It would be necessary, previous to any at tempt to shew in what manner it was intended to alter it, to give a brief view of it—to state for what purposes the Sinking Fund had been devised. When after the disastrous war with America Mr. Pitt was called to the head of the Administration, fie found in every quarter disorder, confusion, and approximate ruin. The finances of the country ap. peared tn be utterly ruinesl; but beneath this appa rently distressing state of her affairs, is cOmpre liensive and penetrating mind discovered latent 'principles of great strength and stability. The result proved that his views were correct, for in 1786, he had reduced the public expenditure of the nation to the peace establishment, and had, moreover, set aside one million towards the discharge of the Public Debt. This, he had provided, should be laid out at compound interest till it amounted to a revenue of four millions, which was to continue applicable to the reduction of the Debt, while the interest of that part which it went to redeem, was to be placed at the dis posal of Parliament, to be employed also for the re duction of the Debt, or in any other way which the circumstances of the country should induce them to think more eligible. but this great Statesman did not stop here. Not contented with extricating the country from the calamitous state in which it had been left by the American war, and planning a fund by which the people were to be released from the weight of taxation ) he endeavoured to provide against n future aberration of that fund from its original purposes, and, in the year 1792, submitted to the • }louse the plan which he wished to adopt with that view. This was, that the principle of redemption should be interwoven with the debt itself; that no contract should be made for a Loan without its being by implication a part thereof; that the Loan should go to the augmentation of the Sinking Fund in a cer tain ratio ; and that being so, no alteration of the sys tem could take place without a breach of faith being committed with the public creditor. If he (Mr. Hus kisson) wanted any illustration of the truth of what he now advanced, it could be provided from the re cords of the House, on which the objection then made to Mr. Pitt's plan would appear • namely, that it went to remove the discharge of t he National Debt from the reach and controul of Parliament.—[Here the Honourable Member caused to be read, in proof of what he had advanced, a portion of the fifty-fifth chapter of the third section of an Act passed in the thirty-second year of his present Majesty ; and then went on to observe, that at the time it was passed it was left to the option of Government to propose spe cific means to pay off a loan at the end of forty-five Eears, or from that period cause to be issued from the xchequer, to increase the Sinking Fund equal to 100th part of the capital Steck cieated.j—They were to choose one or another mode of reducing the Public Debt ; they were to raise a loan, which should he payable in forty-live years ;or they were to raise the Sinking Fund, the increase to terminate in forty-five years, if the reduction of the Debt could be effected within that time ; but failing in one of these modes, the Sinking Fund was to issue of course. He would now endeavour to explain why the term of forty-five years was that fixed on :—The One per Cent. Sinking Fund would produce a capital one hundred times the amount in that time. At the period in question, a great part of the Public Debt consisted of Three per Cent. Stock ; and whatever accumulation of Debt was to take place would be at that rate ; but the Sink-! ing Fund being at Three per Cent. for forty-five years, that gave the measure the time which was deemed necessary for the reduction of the Public Debt, so that as the Public Funds were depressed be low par, the Sinking Fund would be found of greater efficacy. Now if the Chancellor of the Exchequer , did not inform the parties interested of his intention to have recourse to some specific mode of relieving the financial system of the country, they would un derstand that the one per cent. was to issue and con tinue to accumulate at compound interest. A lender would be aware . of the circumstances of the Sinking' Fund, and its effect on the depression of the Funds to operate as 'two instead of one per cent. and thus re duce the Public Debt in 23 years instead of 45; the result of which was, that two class of men were ena-4 bled to bid higher, and, indeed, compelled to do so by competition. The public thus derived advantage from the Sinking Fund, and that and the obligation 'were reciprocal. Here the Honourable Member forcibly insisted on the injustice of the change of sys tem now projected, and went on to observe that the public creditor had no appeal but from the power to the justice of Parliament, and that therefore they were bound to shew, when about to have recourse to any mange that would affect his interests, that they had , justice on their side. The Honourable Member then contended, that if the Chancellor of the Exchequer was justifiable in making any infraction on the origi nal plan at Was time, he would have been equally 60 in ten days, or any shorter time after - it had been adopted. e would also tell his Right Hop. Friend, if an alteration were made with respect to the appli cation of Cie one per cent. Sinking Fund, why an al t :ration might not be made in die issue of the ewe y it - . Item the - Excheiltier ; for the saute AcrdPiritautent that prescribed the one, prescribed die other. The . plan of his Right Hoa. Friend, if it were adopted, would set the whole system of our Finances aficitt. In his opening speech, on this most important *abject. his .Right Hon. Friend had endeavoured to,pressonto his service the authority of JVIr. Pitt, contending that the inference from Mr. Pitt's conduct was, that were he now alive, he would support the proposed mea sure. Now he (Mr. Huskisson) owned, with all his veneration for Mr. Pitt, he -must say, that in a case where the meaning of an Act of Parliament, and of a contract, was so plain, he must look to the letter of that act, and of that contract, rather than to any au thority whatever. But. on what ground did the in ference of his Right Hon. Friend, that Mr. Pitt's au thority was in favour of the proposed measures, rest ? Assuredly not on any direct assertion, but en certain financial arrangements, which took place in 1798, 1799, and MOO, when Mr. Pitt was Chancellor of the Exchequer, and also in 1802, when Lord Sid mouth was in office, and received the concurrence of Mr. Pitt in the financial measures which he proposed. In the first place he would ask, what were the financial arrangements of the former of those periods, the years 1798, 1799, and 1800 ? That was a period of such great public depression, that Mr. Pitt thought it ne cessary to have recourse to the unexampled propo sition of raising the large supplies within the year by War Taxes, and of coupling with that arrangement a plan for the more rapid reduction of the debt than by the operation of the one per cent. Sinking Fund. In 1798 the triple assessments took place, and these were subsequently charged to the Income Tax. The principle of these measures was to prevent the accu mulation of debt, and to do so it was provided, that instead of the operations of the one per cent. Stnking Fund, the whole of the Income Tat should be mort gaged for the redemption of the Debt. In what view, therefore, could it be inferred from that arrangement, that Mr. Pitt would have been friendly to the one now proposed ? for, instead of prolonging the term of redemption, it curtailed it, and provided for its occurrence-within a few years ; and its great object was to invigorate the powers of the Sinking Fund.— " But," said his Right Hon. Friend, " had the war continued for 45 years, then there would have ex isted no mans of redemption but out of the general Sinking Fuhd." This was a far fetched supposition, and contained in it no argument unless it could be shewn, that when this measure to which he had al luded, was projected, Mr. Pitt and Parliament had it in contemplation that the war would last for that pe riod. It so happened, that in 1802 (a somewhat shorter time than 45 years !) peace was concluded. Lord Sidmouth, then at the head of the Treasury, thought it would be most conducive to the public in terest to repeal the Income Tax, and to consolidate the sum so charged on one tax (about 56 millions) with the general Debt as it then existed. It might, perhaps, be said in strictness, that as this 56 Millions had been so charged and secured on the Income Tax that tax ought not to have been repealed until that sum was redeemed. It was unnecessary for him to argue this point. All that he contended for was, that the operation of the measure of 1802, involved no departure from the letter of from the spirit of the Act of 1792. The 56 millions became part of the Debt like any other—a debt on which the Government of the time might properly exercise the option of either allowing the operation of the one per cent. Sinking Fund, or devising any other mode by which it would be redeemed within 45 years. He would not enter into the consideration of the policy of the course that was adopted on that occasion. It was sufficient for him to state, that the mode of allowing the operation of the one per cent. Sinking Fund was rejected, and that another mode was adopted, by which it was sa tisfactorily shewn, that the 56 millions (90 millions in Stock) would be redeemed within the forty-fire years prescribed by law. Tables were laid on the Table of the House, at that time, to prove that such Would be the case, even under the most unfavourable supposition, nam ely, that the 3 per cents. would re main invariably at par. There was nothing in all that inconsistent with the Act of 1793. On this subject, he would refer his Right Hon. Friend to a very grave and serious authority, deserving of the utmost reve rence and respect—he meant the Report of the Com mittee of Finance in 1797. Every one knew the de ference that was due to that Report. The first Re port of that Committee contained these remarkable words—words the more remarkable, as they com prised a 'statement of the condition of the old Sinking Fund, contra-distinguished from that of the new 44 he old Sinking Fund, after it has reached four millions. can no longer be made applicable to the purpose of the law ; and then the old Debt may re main. But the operation of the new Sinking Fund i is to continue at compound interest until the new . Debt shall be wholly extinguished by it." This pas sege seemed framed to draw the strict line between the law applicable to the old and to the new Sinking l i Fund. He-had, he conceived, said enough to shew that his Right Hon. Friend had noaight to infer that Mr. Pitt would have been favourable to the proposed measure. But regard to truth and justice, and the deep veneration in which he held the memory of Mr. Pitt, induced him to state a fact, to the truth of which he pledged his honour and every sacred principle dear to man. The fact was this—that in 1802, when the Bill was in progress through Porlia ment for consolidating the old and new debts and Sinking Funds, and when the attention of many per sons out of doors was directed to the subject, It per son eminently skilled in calculation, and of great acuteness of mind put into his (Mr. Huskisson?s) hands, a statement and a calculation founded upon it, of the nature and probable result of the proposed measure. The conclusion to which This person came was, that after the consolidation had taken place, it would be right, at stated intervals, to measure the Sinking Fund with reference to the unredeemed debt, and that whatever proportion appeared to be over and above what would be necessary to redeem the debt in 45 years, should be held applicable to the public service, either by leading to the remission of taxes, or in any other way that Government might think proper. For his own pan, he confessed, that he was a good deal struck with thik proposition. It did appear to him, that it had much to recommend it ; and either at the request of the party, or by his permission (he could not remember which) he gave it to Mr. Pitt. Mr. Pitt, however, received it with the most pointed reprobation, and when he (Mr. H.) attempted to• defend it as a measure applicable to a trisledtpeice, Mr. Pitt said, that he had other views with respect to providing against the evil adverted to I n peace (which views he did him, Mr. H. the honour to communicate to him) but that as applicable to a state of war, the proposed measure vsas inadmissible, and would be ruinous. These were the mildest terms used by Mr. Pitt on the occasion. He really applied harder words to the character of the plan, which he (Mr. Huskisson) 'would abstain from repeating, be. cause the plan now proposed' by his Right Hon. Friend was in substance precisely that which Mr. Pitt had so severely condemned. The complicated machinery of the measure now proposed certainly differed train that to which he had alluded ; but, he repeated, that in substance and in principle they were the same. At the same time he should do injustice to the view which he had taken of the former plan, if he did not observe, that although the principle of the two measures wat the same, the times at which they were proposed were essentially different. In 1802 the country was at peace, public credit stood very high, and it was not thought that any loan, ex cept that which was negotiating, would be - wanted ' for a long time. At present we were engaged in a war apparently indefinite in duration, public credit was mush depressed, and loans were every year con tracted for to an unprecedented amount. The whole principle of these two plans was, that in time of war we should best liberty to push the debt to the maxi mum of its amount, and to reduce the Sinking Fund within the minimum of its power, provided it erected its work of redemption in forty-five years. If his Right Hon. Friend conceived that he could establish a proportion between the Sinking Fund and the Debt for forty-five years, without paying any attention to the amount of unredeemed Debt, he cherished a principle that would be most fatal to the public inte. -rests. It was true in figures that ten millions of Sink. ing Fund would be as equal to the liquidation of 1,000 millions of debt as one million of Sinking Fund to the liquidation of 100 Millions of debt. But when it liras recollected that the vs hole debt was a market able and transferrable property, it would appear that that which was very true in arithmetic, would be very fatal in practice. One hundred millions was a debt which it might be salutary to the country not to redeem. But a debt of 1000 millions, even with its proper Sinking Fund, might break down the pub lic credit altogether. But his Right Hon. Friend had said that his plan possessed advantages which more thap compensated for the evils that it might contain. These advantages were four in number : the first ad vantage was, that it would provide for the gradual and equable reduction of the Public Debt ; the se. cond, that it woufd provide against the too rapid di minution of the rate of interest; the third, that it would afford a subsidy of 250 millions for carrying on the war ; the fourth, that it would enable us to, accumulate after the completion of the war a fur ther subsidy of one hundred millions for any purpose to which it might be thought expedient to apply it. With respect to the first of these advantages, it did appear to him extraordinary, that his Right Hon. Friend should talk at this moment of a gradual and equable reduction of the Debt, as if we had hitherto done too much in the way of reduction, or as if ttiat reduction had been of a desultory nature. It was true, that in the last tweet) , years, 200 millions cf debt had been paid off ; but in doing it, 6(X) mil lions of fresh Debt had been incuired. His Right Hon. Friend wished to make the reduction more equable ; and how did he proceed to make It so ? by reducing one half the means of redemption.— What were the symptoms he (Mr. Huskisson) wish ed to know, of the Sinking Fund being in too great a proportion to the Debt ? That which his Right Hon. Friend had added to the public Debt, this and the last year, exceeded the amount of the redeemed Debt during the six preceding fears ! At such a time it was strange to propose that the Debt should be redeemed more gradually. The second advan tage stated by his Right Hon. Friend was, that hi: plan would provide against the too rapid diminution of the rate of illterest. When did his gight Hon. Friend wish to do this ? When he was about to go to the money-market for a loan, which taking all the circumstances into consideration, taking also Ireland and India into the account, would probably be nearer 40 than SO millions ! At such a moment his Right Hon. Friend thought it necessary to guard against the diminution of the rate of interest. His Right Hon. Friend knew very well that with all the ad vantages given to the public creditor, with the ad vantage attendant on a nominal capital (available to future profits), with the advantages of the exist ing fund, with the advantage of the recent occur rences in the North of Europe, his Right Honour able Friend could not borrow—not forty millions, but not £lOO within the rate of legal interest ; and yet it was thought necessary at such a moment to guard against a rapid diminution in the rate of in terest. What was the disease that affected public i credit ? When his Right Hon. Friend was called in, he told the House that public credit laboured un der great depression, and he promised to administer a powerful stimulus to it. The state of the patient was the same—nay, it was worse than at the time when that character was given to it. . But what said' the physician ?—that he thought he had discovered something in the constitution of the patient, which if not checked, might, about the year 1830, subject him to the inconvenience of repletion ; and there. fore, that, instead of the cordial which he had talked , ( about, he prescribed an immediate and copious bloc dine, to be followed up by three others in rapid suc cession. If his prescription of his Right Honourable Friend's should be adopted by the House, it would be but fair to apprize the numerous f r i en d s o f t h e ! patient. in the ordinary language an such occasions, that they must prepare themselves for the event which could not fail to follow. He suspected, that after the fourth bleeding, the mourning for the poor patient would be very general and very sincere. The third advantage proposed, was to provide a subsidy i of 250 millions, for carrying on the war. When his! Right Hon. Friend first mentioned this, he (Mr. Huskisson) fancied that lie had discovered that which had puzzled Van lielmonti and many other great philosophers, namely, the philosopher's stone ; or that, at least, he had found an unexpected treasure in some secret drawer of the Treasury. What was the fact ? By incurring a debt of 600 millions, we bad paid off two millions—let it be remarked by the way, that we should not hive paid off these two mil , lions of debt unless we had incurred the six. Was it possible, therefore, that we could call the balance, of U an adjustment a subsidy ? The fourth advaringe proposed by his Right Honourable Friend, was the acquisition of another treasure of 100 millions in time of peace. This real treasure was of this de. scription, viz. that whereas we had added 500 mil. lions to our debt, if the war were to cease to and peace were to be of long duration, we should pay of 100 millions of that debt ; and this his Right Honourable Friend called a treasure. His Right Honourable Friend had said, that no other nation ever possessed such a treasure. True t but as a pre. liminary step, they must first get Into debt. Certainly no other nation was ever so deeply in debt as England. It was an advantage of which she would retain pos. tession undisturbed by that jealousy and envy with which her other blessings were viewed. If the tub: ject were not of too grave a nature to admit of such a proposition, he should imagine that his Right Ho. assurable Friend was trifling with their understand: ings. He had expressed himself as if the House were incapable of distinguishing between paying of a small portion of a large incumbrance, and an /CCU. mulation of riches-was if the public debt were the public property, instead of being only the melancho. ly record of so much wealth expended. But much stress had been laid by his Right Honourable Friend on the tendency of the plan to postpone the imposi. tion of taxes. Unless, however, every feeling of the present Parliament differed from the feelings of all their predecessors, before , they adopted a measure which was plausibly and delusively popular, they would look carefully at the circumstances of the times. What was. an exemption for three or four years ?—a short period in the life of an individual—. in the existence of a State, nothing. In considering the permanent interests of the country, their views ought to be carried forward to a much more distant period.--[The Hon. Gentleman here entered into it detailed examination, into which cannot not pretend to follow him, of the Tables that have been publish. ed by the Chancellor of the Exchequer, with a view to shew their htaccuracy.]—lf the proposed plus were allowed to be carried into effect, greater en. croachments would be made on the Sinking Xuad. and it would soon be in the same state as the Grand Army of France had lately been described to be by one of the Marshals of that country, namely, " as no longer existing, except in name." He had heard it argued out of doors, that the plan ought to be adopted, as it would give a temporary relief to the country. In the first place, in his view of the ex isting Acts of Parliament, this relief was not corn. patible with public faith. Parliament should re. collect, that they were judge and party in this bud. ness—judge too without appeal. Parliament should avoid injustice. Let the House consider what a Loan was. It was nothing more than a sale at a public market of a certain amount of Annuities. to be charged on the Public Revenue. The whole of the Public Debt was merely an aggregate of Loans. The Sinking Fund was set apart for the gradual re. ductiun of that Debt. *lf the Debt were eucreased on the one hand, 'and the Sinking Fund diminished on the other, there would be a greater supply of the commodity in the market, and a less demand for it. This must necessarily affect the price of the commo. dity, and injure those who held it. Huw extensive injury, could not be immediately calculated but the occurrences of late years had shewn that pub lic credit invariably improved as Loans, or in other words, Debt diminished. Let it also be considered, that the public creditor had in view not merely the interest of his capital, but the improvement of the capital itself. With respect to the subject as a guts. dem ofvolicy, to break faith would never be politic; bdt putting this out of view, the proposed plan was inconsistent with our nearest and dearest interests, growing out of our policy. It was contrary to all aiaxims of practical wisdom which he had data. ved during his public life from the financial dia. cthsions in that House, and from no one in greater lumber than born his Right Hon. Friend. Was a moment for such fatal experiment, when pub lic credit was in such a state, that it had been ciated 20 per cent. in two years? Did his Rtght= • Friend conceive that such a depreciation on a capital Jf 600 millions was no injury to the country—was a matter of indifference to private or public interests! Did he not think that it would not affect conunerce e manufactures, agriculture, and all important pubic works. Firmly was he convinced that it would As felt in all the branches of public industry. The Honourable Gentleman next proceeded to advert to the received impressions relative to the Sinking Fiat/ upon the Continent. It was considered, he said, as the main prop or stay of public credit in this coon• try, as the peculiar source of all those exertions which we had continued to make' during so long a period of war and difficulty. They had seen us adhering to it under all the pressure of 1797, at the stopp ige el cash payments by the Bank, and under all the it's.. ries a hich our trade hid suffered. Under away vicissitude and change of circumstances they knew, or thought they knew, what this Fund had done fee us. if he wished for a further illustration of the opinion which was entertained abroad of the utility of the Sinking Fund, he would instance the pba which Bonaparte himself had pursued in establishing a Sinking Fund on the model of that in England.— This despoiler of the world, who had made such ra• pid strides in the march of desolation—this despot, whose political economy goes to force men from being productive to become unproductive beings her his odious system of conscription, still had the a. 4 1. dom to establish a Sinking Fund in France as the best and safest source of national prosptrity. What then would be tt.e effect produced on the mind of the enemy, when they saw us seizing on one half of the Sinking Fund—when they saw us breaking down ag those safeguards which protected the rep:air:lx : The Hon. Gentleman next proceeded to exan oe , the ()Onions held upon the plan of 1801, for an ex emption from taxation for three years. Lord Sid mouth, when he brought forward his last bur!Lets had strongly urged the necessity of adding entitles million to the war taxes, in order to equalice we in come with the expenditure, fur when that. great point was attained, the accumulation of the Sinking Fond would afford a relief, which could not. with justice to the stockholder, be derived from it till then. Thea was the authority of his Right Honourable Friend (Mr. Vansittart) for not touching the Sinking Fund until the Public Debt ceased to accumulate. His. Right .Honourable Friend in 1809 and in 1812 ha/ uttered opinions very different from those which bi now expressed. If.he thought that the nation. after