The Sun.
London, England, 1854-05-23 00:00:00

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IMPERIAL PARLI AME NT.

HOUSE OF COMMONS—(YESTERDAY.)
WAYS AND MEANS.
The CHANCELLOR of the EXCHEQUER then moved
that the Speaker do leave the chair.
Mr. T. BARING said he felt it necessary to say that he
?should postpone the amendment of which he had given no-
tice, on the proposition of going into ways and means, till
the house went into committee.
The CHANCELLOR of the EXCHEQUER said, so far
as the Government were concerned there was no change
whatever in their intentions or announcements. He could
not understand how there could be any misunderstanding
as to the order of proceeding, for he had been most careful
to state That they should first take votes on all the new
taxes, and it was for that reason that he now moved that
the house should go into committee.
Mr. DISRAELI said that was certainly not the order of
proceeding they understood was to be followed. Ho did
understand the report of the formal resolution was to have
been brought forward last Monday, in order that the opi-
nion of the house should be taken on it. (Flew, hear.)
Lord J. RUSSELL sail he thought it was perfectly
clear that either the report or the further resolutions in
committee should be taken when the motion was brought
on. (Hear.)
Mr. T. BARING said he certainly had understood that
the original resolution should be proceeded with first ; but
as that was not to be the case, he must now move that
amendment in committee which ho had intended to submit
to the whole house. He certainly did wish he could give
a silent vote on this occasion, looking at the great and pe-
culiar difficulties of the times—difficulties which he would
say arose from the mismanagement of the finances last
Year, and from the unwise conduct of her Majes•
ty's Government. (Hear, hear, hear.) Thinking, as
he did, that the financial measures adopted last year
were wanting in prudence, and had been unsuccessful, he
could not now give a silent vote on the present measures.
He thought the Exchequer-bill market was amost valuable
resource for any Minister, but that market must be main-
tained by the Chancellor of the Exchequer shaping his
operations according to transactions elsewhere, and a con-
viction that Exchequer-bill hollers can always obtain their
money whenever they wanted to change their investments.
The sum of 652,4561. of stock of the funded debt of savings
were
had been sold to buy up Exchequer bills, and they
again converted to the funded debt of the country,
entailing an additional lueden on the debt of the country
~..03,000/.—and that was caus-d by the conduct of the
Government with respect to the financial measures of last
year. He hoped that for the future the finance of France
-would not be made the basis for that of a finance Minister
of this country; for it could not be creditable to compare
the
finance of a coantry like England, whose resources
or credit have never been doubted, with that of a coun-
try like France, which, whatever its resources might
be, was only just recovering from a general and total con-
vulsion. (Hear, hear.) He approved of the desire of her
Majesty's Ministers for preserving peace, but if there was
the slightest speck of a cloud of a disturbing canse abroad
they ought to have paused last April (1853) when
they proposed their financial measures—(hear),—and there
'was in the blue book a letter from Lord Clarendon on
tne movements of troops towards the Russian frontiers,
Which should of itself hove given them that warning. He
could not then but say they ought not allow this resolution to
Peas withoutsaying more caution should have been exercised
it the past, and that more prudence should be observed for
the future. (Hear.) He could not imagine that between a
reasonable Chancellor of the Exchequer and a prudent go-
vernor of the Bank of England, there should be anything
that could not be reconciled, for the benefit both of public
and of private credit. (Hear, hear). And whilst he allowed
that deficiency bills might be resorted to in an emergency,
yet if the Bank were forced to raise its interest on these
bills, they would not have great advantages, but they
would have the disadvantage that they might have to ask
the Bank for money, which the Bank could not grant
without serious restrictions upon the commerce of the
country. (Hear, hear.) The Bank had always been ready
to meet the demands of the Government, and for this rea-
son it was the earthen vessel, while the Government was
bills might
of iron. But while he would allow that deficiency
might occasionally be resorted to, he thought that
If they were to have a rule at all, the most prudent rule
Would-be to keep a balance in hand, so that the wants of
the Government might be supplied out of the previous
lather than the future income. (Hear, hear.) They had
heard something, indeed, of a little loss sustained by the
Public from allowing large balances to be in the Bank with-
out interest; but the gain from adopting the opposite
course would not be so great after all. The Goverument
of this country was a large borrower, and they must keep
,the state of the Exchequer Bill market in mind. If by
-Lowering their balauces they forced the Bank to raise its
rate of interest, not only would they have to pay that en-
hanced rate on what they borrowed from the Beak, but
they would have to pay a larger interest on the floating
debt. (Hear, hear.) Besides, they might have to ask for
money which the Bank could not afford without incon-
veniencin the trade and commerce of the country; and
that again, he need not say, would recoil on the prosperity
of the Exchequer. He thought that the policy which the
light hon. gentleman had laid down as that which was to
he the future policy of the Government, namely, to look to
tleficiency bills to a grear or less extent for e supply of
the daily wants of time public th
service, was as a principle—
exceptions were of course to be allowed—but it, was, as a
rule, impolitic. (Cheers.) He had said thus much upon
th
e policyof the Government; but if the house would ex-
cuse him he would now proceed to make some remarks
upon the present position of the finance of this country.
(Cheers.) The right hon. gentleman on the 6th of March
'Laid there were three ways in which the wants of the Ex-
chequer might be met, namely, by a system of loans, of in-
direct taxation, and of direct taxation. The right hon.
gentleman had adopted the last ; but he did not pledge
himself, if the war lasted, that he might not have to have
recourse to indirect taxation, and that, strong as was his
feeling against loans, he might not be eventually forced to
adopt that course. He (Mr. Baring) shared with the right
hon. gentleman's feelings with regard to increasing the
National Debt. (Hear.) So far as he had taken part in
the debates of that house, it had generally been to rebuke
the Government for not keeping sufficiently large balances
to be applied to the gradual extinction of that debt ; for he
was one who thought that the gradual extinction of that
debt in time of peace ought to have been made a more pro-
minent feature in our finance than had been the case.
(Hear.) Not, indeed, by fits and starts, by paying off ten
millions at par when it could have been bought at 85—
(cheers)--but by such a regular process as would have en-
abled the minister, not only to have reduced the capital,
but even to have dealt with the interest. The right hon.
gentleman had professed great reluctance to resort to a
loan ; hut he thought the right hon. gentleman was hardly
sincere in the language he had so properly held upon that
subject. When he had made use of the savings banks funds
to increase the national debt, and when he put forward his
scheme to reduce the interest to 24 per cent. by increasing
the capital of the debt ten millions, the right hon. gentle-
man was certainly not so coy. The right hon. gentleman had
censured the imprudence of Mr. Pitt in raising 180 millions
by loans in six years ; but he did not seem to reflect on the
difficulty Mr. Pitt must have had to raise 3J or 40 millions
a year by taxation without making the war unpopular or
too severely straining the national resources. The right
bon, gentleman said his own a tempt to raise six millions
Was not a loan ; but surely its being borrowed for two,
fe°llr, or even six years, would not make it less a loan.
',Hear, hear.) But was the right hon gentleman so sure
that he should be able to pay these bonds, when they be-
came due, without inconvenience ? Or was he even sure
that he should then be Chancellor of the Exchequer ?
(He•tr, hear.) The then Chancellor of the Exchequer might
talk of the right hon.. gentleman as he now talked of Mr.
-ritt, (A. laugh.) He might say, " I have the greatest
veneration for the name of Gladstone—(laughter)—but I
hal he had not begun his war with these ad interim
finances. (Hear, hear.) He was a great Chancellor of the
Exchequer, but he made these petty loans at short dates,
Which so puzzle me. (Laughter.) He was anxious to
_lase his country from burdens, but he has greatly embar-
rassed me who have to pay these loans with an empty ex-
-I,cuequer, and a country impoverished with war. I Hear,
`iiear-) Yet Gladstone was a great financier; for he eau-
.„-"yroade the House of Commons think he was not bor-
slwtug at all." (Loud laughter.) The sum which the
"ght " hon. gentleman wanted was 3,543,003/., of
Which the house had already granted 2,0,0,00 J/. by
vthis loan, and a million and a half was therefore what
now remained to be raised. He (Mr. Baring) believed
hat under any other circumstances than those in which
Placed
right honourable gentleman had most unfortunately
Placed the Exchequer-bill market, he might easily have
erelired the money by Exchequer-bills. (Hear, hear.) If,
wever the Government wished to Lemke a loan, let them
it openly, and call it a loan. (Mr. Gladstone, " Hear,
hear.") He understood by that ceeer that the right hon.
gentleman said it was a loan. It was then a loan, and
Oei made under great disadvantages, for they borrowed
at 4 per cent., and hound them selves to pay off the debt
Within a certain time. He (Mr. Baring) should at all
events propose, if the Government gave the option of pay-
bleat to the bondholders at all that the period should be
air years instead of four ; because then the terminable
annuities would have fallen in and the Government would
have something wherewith to meet the demand. (Hear,
hear.) The right hon. gentleman's loan had not hitherto
been very successful, and yet it seemed preposterous
that a scheme should fail which involved the
payment of 34 per cent. for four years. (Hear, hear.)
The right hon. gentleman had said that he had to combat
with great obstacles, with the monied power of this
country, and that that monied power had been constantly
anxious for war, in order that they might make colossal
fortunes, as heroes were anxious for war that they might
distinguish themselves. He thought it would have been
allowed that, at someperiod, the bankers and capitalists of
the City of London had rendered good service to the state ;
but the right hon. gentleman considered them as the
vampires that Bricked its life-blood. (Hear, hear.) He
said that Mr. Pitt was only called a heaven-born minister
because he made loans; but might it not be that the term
was applied to Mr. Pitt because he was always successful
in his operations ; and the right hon. gentleman certainly
could not claim to be " heaven-born" in that sense.
(Cheers and laughter.) He would tell the right hon. gen-
tleman that it had been his lot, in his vocation, to have
some dealings with those connected with the monied power
of this country ; and he did not believe them to be so bad,
!L.? Powerful, or so useless as the right hon. gentleman did.
He tried to cast an odium on those who were striving to
make colossal fortunes. Actuated by this feeling, with
what pleasure the right hon. gentleman must have doubled
the income tax ; anti with what pride and pleasure tit
country must know that there were colossal fortunes whthe
could meet the increased taxation. (Hear, hear.) But
!tooled interest were not so powerful as the right hon. gen-
tleman supposed. They did but reflect public opinion ;
they were but the middle men, who conducted the dealings
between those who had large fortunes and those who had
°Mall ones. They were but the representatives of public
°Pinion_; and the reason why the right hon. gentleman
found that they had not aided him was in reality because
,s
had not offered them anything which the public wanted
to buy. (Hear, hear.) It was those who had dissented
from. the right hon. gentleman's conversion scheme that
had made their fortunes—those who had taken their money
instead of his new stocks. (Cheers.) And now the right
licbegentleman said, " It is very strange I cannot get these
monied people to act with me, because I give them what
The right
is right, and they won't accept it." (Hear, hear.)
•te right hon. gentleman should recollect that public
°pinion was not to be forced, that forced operations
Were seldom successful. And, though he might say
that all was best that was done by this best of all pos-
sible governments, the public dealers in stocks might take
a. different view, and might think that they had not had
exactly what they ought to have. (Hear, bear.) Then
the right hon. gentleman said the matter was now in the
hands of the House of Commons; the First Lord of the
Treasury and the Chancellor of the Exchequer were very
weak with the monied power, but if the house passed a
resolution it must prevail. He (:afr. Baring) bad a, very
great respect for the, of Counnons; he knew that
its authority was almost supreme and omnipotent ; but
there was one thing it could not do—it could not make the
Pliblia buy what they did not want, U they had the option

of refusing it; it could not make them invest money in
what they did not like, or feel confidence in that which
they had been taught to distrust. (Cheers.) He would
ask the house to adopt his amendment for this reason. He
wished the Government to speak out plainly and tell them
what they wanted this money for, and to what extent
they really wanted it. Was it to restore the balances of
the Exchequer at least to what they were only last year,
and which the Government said ought never to be so large ?
Was it that they had under-estimated the expense of the
war? Let them come boldly forward and tell the house
what they wanted for the expenditure of the war, and they
had already seen with what readiness the house would
grant their demands. (Hear, hear.) It had been said
that this was a vote of want of confidence. But, if this
were so, anything might be distorted into a vote of want
of confidence. The slightest censure, the merest hint
or expression of apprehension for the future, might be
taken as a declaration of want of confidence. The -esost
powerful Governments had been beaten on a budget, and
had not considered it as a vote of want of confidence. Un-
der Lord Liverpool's administration the income tax had
been repealed against the Government, thus taking from
them a revenue of 12 or 15 millions ; still the Government
went on. They had seen, later, under the administration
of the noble lard (Russell), two or three budgets brought
forward and taken back again. (Cheers, and laughter.)
And that was not considered a vote of want of confidence.
He had voted for the new taxes of the Government, not
because he (lid not think that various objections might be
made to them, bug because he did not wish to throw im-
pediments in their way. (Hear) But this, if a vote of
want of confidence at all, was a vote of want of con-
fidence on schemes which had failed, on measures
which had been rendered abortive by the bad way in which
they had been put forward. (Hear.) It was a vote of
want of confidence that, in four or six years hence, the
state would be able to pay these Exchequer Bonds. (Hear.)
Let the Government say what they wanted; if it was a
loan let them have it. If they wanted taxes, let them come
forward and say what amount they wanted ; but let them
not go on inju ing the public credit by those constant,
worrying, meddling changes—this succession of disastrous
experiments. +Cheers.) Let not the Government think
that they could play the game like any other game, by
bringing forward a measure, and if it was a bad move,
taking it back, and playing again. Financial mistakes were
national misfcrtunes. (Hear.) Financial failures were
great calamities ; and a series of failures was fraught
with danger -,o the credit of the country. (Hear,
hear.) The Government had a great power to back
them ; they hid called on the energies of the people ;
they had taxed the resources of the country • and
the country would respond to the demand. (Hear.) But
they had within reach arms still more potent--the national
credit ; that credit had achieved wonders, and it could do
the same again. But while powerful it was at the same
time most sensitive. Under the guidance of a judicious,
careful, and experienced hand, it could be borne through the
crisis uncrushed and uninjured; but beneath the touch of
a meddling, fidgetty, irritating pressure, it might shrink
into impotence, or direct itself against its employer and pro-
duce nations? debility. He called on the house, not only
not to avoid loans, but to avoid this constant tampering and
meddling—(hear)—this constant attempt to do something
new, something novel, something grand. (Cheers.) With
those feelings, and wishing to enter his protest against the
continuance of this system, he ventured to propose the
amendment of which ho had given notice, and which was
in the following terms :—" That it is not at present expe-
dient to authorise any further issue of Exchequer Bonds,
with the engagement of repayment within the next six
ye ,rs." (Cheers.)
The amendment having been seconded and put from the
chair,
Mr. Y. WILSON rose, he said, to expose the numerous
errors into which Mr. Baring had fallen. He denied the
connection, which Mr. Baring had endeavoured to estab-
lish, between the financial operations of last year and the
resolution under consideration. He justified these opera-
tions, explaining the state of the national finances at
that period, the amount of the public balances, and
the object of the Chancellor of the Exchequer in his
action by means of these balances upon both the
unfunded and the funded debt. With regard to the
former, he +nsisted that, but for the failure of the attempt
to convert the South Sea Stocks, the operation upon Ex-
chequer-bills would have been successful ; as it was, the
result of both operations had been a reduction, in princi-
pal and interest, of the national debt; and the only point
contended for by Mr. Baring was, that better terms might
have been obtained. With regard to the transactions be-
tween the Government and the Bank of England, he ad-
mitted that each party was entitled to due consideration
from the other; but there were questions between them
upon which discordant opinions might exist. Since 1844
the terms of their dealings had been regulated by act of
Parliament, and Mr. Wilson showed the privileges and ad-
vantages which the Bank enjoyed under this arrangement.
The question at the bottom of all these discussions, he be-
lieved, was—Were we to pay the expenses of the war from
means raised within the year, or to have recourse to loans ?
He showed, from the report of Sir Henry Parnell's com-
mittee, the consequences of a fundamental error committed
by Mr. Pitt, in 1792, by the hasty an dunnecessary adoption
of the borrowing system, which had loaded our finances
with a debt, from a large portion of which the country
had derived not a farthing of benefit. This fact, he thought,
furnished a lesson to us, and a weighty argument against
the suggestion of Mr. Baring. The issue of Exchequer-
bonds was not to be considered as an ordinary loan ; they
were temporary securities, and not to be essentially
distinguished from Exchequer-bills. But, if the
expenditure was to be defrayed by taxes raised
within the year, what, it had been asked, was this
money wanted for? He replied that new taxes were long
in coming in, and the want of money in hand at the mo-
ment had been, during the late war, the occasion of im-
provident bargains. The resolution and the amendment
involved the whole question of enabling the Government
to lay the foundation of a system of finance so beneficial in
the conduct of a great war.
Mr. MALINS urged at considerable length the impru-
dence, in spite of warnings, of the measure of last year for
converting the 3 per cent. stocks ; and, in connection with
that operation, he condemned the scheme of Exchequer-
bonds, which, he insisted, constituted a loan, as at vari-
ance with principles laid down by the Chancellor of the
Exchequer himself. He could not put the loss to the
country from his false step, he said, at less than 800,0001.
The present proposal to raise a loan of 6,000,000/. at 4 per
cent. to pay off a 3 per cent. stock would occasion a loss
of 60,0001. a year. On the subject of Bank accommodation,
Mr. Malins argued against what he considered to bo falla-
cies in the views taken by the Chancellor of the Exche-
quer and Mr. Wilson, and, in conclusion, he predicted the
probability that the scheme now proposed might entail
hereafter a further loss of 600,0001.
Mr. LikING thought ii necessary, after considering the
wide field into which the discussion had wandered, to re-
mind the committee that the amendment of the hon. mem-
ber for Huntingdon was, that " it was inexpedient to
authorise any further issue of Exchequer bonds, with the
engagement of repayment within six years ;" the obvious
meaning of which was that there was a probability of Go-
vernment not being able in six years to obtain facilities for
paying off such bonds. Now he could not help thinking
that if that hon . member had the same peculiar experiences
which he (Hr. Laing) had acquired by sitting at a railway
board, he would not have put forward such a proposition.
In his capacity of chairman of a railway, by no means one
of the largest in the kingdom, he had seen operations car-
ried out almost equal to those which the hon. gentleman
feared as likely to cast so heavy a burden ou the country.
(Hear.) Having made some inquiries into the matter, he
(Mr. Laing) could state that the amount of the floating
loans of railway companies at the end of the year 1853 was
64,640,6681., and at the present moment it was about
70,000,0001. The average date at which the sums making
up that total were repayable, was considerably under five
years, but more than four. Taking it, however, at the
longer date, it would be seen that it involved the annual
renewal to the rail way companies of loans to the amount
of 14,000,000/. ; an operation which had been, and was
effected by those companies with perfect ease, in the open
markets of the kingdom. (Hear.) How was the opera-
tion effected? Simply by the rail ways availing themselves
of the enormous class of the public always on the look
out for an investment for their money, which would re-
turn them a some what larger interest than the public
funds. The average amount of the sums advanced to
railways was 1,5001., and the class advancing were those
who sought investments upon mortgage. A few large
sums were advanced by the great insurance offices. The
question was, Ought the Government of this country to feel
any apprehension in entering into competition with the
railway companies, especially when they could offer a bet-
ter security, and one more easily transferred ? He thought
that it was idle to talk of apprehension. (Hear, hear.)
But then it was said that the amount might be better
raised by means of Consols. That was really a question of
convenience. If the amount required were borrowed in
Consols, then it would be taken at 85 per cent., or 3 per
cent. interest; while, if it were borrowed upon Exchequer
Bonds, the amount of interest would be 4 per cent. But
in Consols the country would be bound to pay at par that
which was borrowed at 85, and for that reason he thought
that the Chancellor of the Exchequer had exercised a wise
discretion in the course which he had taken, for he avoided
the example of former wars, when money had been bor-
n owed upon a depreciated security. (Hear, hear.) As re-
garded the details of the carrying out of this principle, he
(Mr. Laing) felt bound to say that there were some things
to be questioned in the course of the Government. (Oppo-
sition cheers.) He thought that the wisest plan would have
been to go direct to the market with the security, and to
have had only one denomination of bond. Having, however,
said this much strictly to the question of these bonds, he
thought it right to state that, in his opinion, the motion of
the hon. member for Huntingdon (Mr. T. Baring) had, in
reality, bean used as a peg on which to hang a much wider
subject, for the subsequent discussion amounted to no-
thing more nor less than an impeachment of the whole
financial policy of the Chancellor of the Exchequer. This
virtual vote of want of confidence had been supported by
a retrospective review of the whole of the transactions in
which the right hon. gentleman had been engaged. The
greatest stress had been laid on the experiment with regard
to the conversion of a portion of the national debt. That
was undoubtedly an easy topic on which to find fault, be-
cause it was admitted on all hands that the experiment
was an unsuccessful one, which it would have been better
never to have made. Yet it was only fair to remember
that at the time when that experiment was made, the
public funds had been for a considerable period above par,
that a conversion had been recently successfully carried
out in a neighbouring country, and that it was a period of
great national prosperity. It was true that there had
been a slight reaction in ihe money market, but upon that
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ter to have closed the scheme at once (hear) and so
have saved all but the first loss; still, upon a mere ques-
tion of detail like that, he did not think that the com-
mittee would agree to a sweeping vote of censure. Look-
ing at this as a matter of private finance, it appeared a
most extraordinary idea. (Hear, hear.) The nation ought
to have a sufficient, indeed a liberal balance, in hand;
but that was no reason why a deficiency in one branch
should not be made good out of a surplus in another.
He (Mr. Laing) dissented from most of the criticisms passed
upon the financial experiment of last year, which was
founded upon the true principle of action upon the national
debt. Before he could consent to the extreme measure of
censure involved in the amendment upon the whole finan-
cial policy of the Chancellor of the Exchequer, he must
look, he said, at the question as a who le, and, admitting
that some errors had been committed, he could not glut

his eyes against the merits of the leading principles of that
policy. It would be a great misfortune to the country if
the present amendment was carried.
Mr. CAIRNS objected -to the proposal of the Chancellor
of the Exchequer to raise, the resources for carrying on the
war year by year within the year ; and he objected to the
taxation by which he proposed to raise these resources.
Who, he asked, were the persons to be permanently bene-
fitted by the war? Those who will come hereafter, and
they should, in his opinion, pay a share of the burden.
But, if the expenses of the war were to be raised each year,
he protested against this being done by doubling the in-
come tax, with all its ineq-cialities.
Mr. JOHN 3.4`GREGOR, approved of the principle of
borrowing money for short periods, and payieg the ex-
penses of each year of the war by the year's taxes. Had
that course been adopted daring the last war, the money
of the State would have boen expended as economically as
that of a private individir With regard to the conver- '
sion of stocks last year, be maintained that at the time
that it was proposed the state of the money market was
such as to warrant the Chancellor of the Exchequer in
making the proposal ; and. he denied that after the termi-
nation of the war, and the return of prosperity, the coun-
try would have lost one shilling by the transaction. The
present moderate proposal ought to be at once accepted.
He characterised the opposition to it as factious, and said
that the amendment had nothing to do with the financial
position of the country, lrat was and would be considered
by the country as a vote of want o! confidence in the mea-
sures of the Chancellor ,of the Exchequer. Whatever
might be the views of a certain portion of that house, how-
ever, he was convinced that the country would support the
finance minister, and would approve of his meeting the ex-
penses of the war without entailing heavy debts upon
posterity.
Mr. T. HANKEY said that after listening with great at-
tention to the speech of the hon member for Huntingdon,
ho was quite at a loss to understand his motive in proposing
the amendment with which he had concluded. He (Mr.
Hankev) was anxious to avoid any expression of opinion on
the part of the committee which should cripple the action of
the Chancellor of the Exchequer, or should declare that
the mode of borrowing mo:aey which he proposed to adopt
was injurious or undesirable. He had never been able to
understand why the Ministers of this country had so long
debarred themselves from raising money by loans for a li-
mited period on the system which had been pursued with
so much advantage by railway companies, and which was
a system acted on by the Governments of all countries ex-
cept our own. He rejoiced that the Chancellor of the Ex-
chequer had at last adopted a system which he believed
would be most beneficial to he country—that of borrowing
for a short and limited time money which he had shown
the house that he should have the means of repaying from
the income to be derived from taxes which he intended to
impose, and which he (Mr. Hankey) understood the house
was not unwilling to sanction. If he had the means of
doing this, he (Mr. Hankey) thought it was a most proper
course for him to adopt, anl he hoped that the house
would not throw any difficulties in the way of his carrying
out such a measure.

In compliance with repeated calls, the bell was rung for
a division. After it had be en ringing some time, and
when a considerable number of members hail entered the
house,

Mr. DISRAELI rose, and was received with cheers and
laughter. He said—Mr. Bou.verie—Sir, I did expect that
some member of the Government would perhaps have re-
plied to the motion made by a most important member of
the house, who is, I think, at all times and on all subjects de-
serving of the attention of a Government—(cheers)—and who
to-night spoke upon a subject upon which he addressed the
house with all the influence w'nich naturally results from his
pursuit, his character, and his ability. I think lam not say-
ing too much in saying that, though the great fault of his
eloquence is the rarity of his appeals, which we all regret,
on no occasion has he addressed either yourself or the chair
on which he has produed a greater effect, or more completely
justified the step which he hau taken. (Hear.) I should
myself have willingly listened to the answer of the Govern-
ment to the objections to the motion which is now before
the house on the part of the Chancellor of the Exchequer,
but I hope the committee will excuse me if on this occasion
I take the liberty of making some remarks upon the sub-
ject before the house. An hon. gentleman who has just
addressed the house told us that it is not upon a mere reso-
lution moved iu committee that the house has to decide,
but that it has indeed to decide upon the whole financial
policy of the Chancellor of the Exchequer. I was not my-
self disposed to view the question in that light, but at the
same time I am not prepared to shrink from that discussion
if it is the mood of the commit tee that we should enter into
it. Sir, I conceive that the demand which the Chancellor
of the Exchequer has made upon the committee to-night
has in a great degree resulted from the principles upon
which he has conducted his finance. I cannot agree with an
hon. gentleman who has recently addressed the house that
we have before us only an affair of detail, and not an affair of
principle. lam willing, therefore, to argue the case on the
broadest grounds, and to take the more comprehensive issue.
I think that the conduct of our finances by the right hon.
gentleman has been from the first erroneous, and I wish to
give to the committee, with as much brevity as I can, the
reasons why I think the administration of the finances by
the right hon. gentleman has been erroneous, and has been,
in consequence of those errors, injurious to the country.
Sir, I think that in the first year of the management of the
finances by the right hon. gentlemen—the management
which has led to the resolutions now before the committee
—it is not difficult to point out a variety of courses that
he has pursued which he was not justified in pursuing.
One advantage that we have in speaking upon these sub-
jects now is, that that which a year ago was abstruse to
the majority of hon. members—which even a couple of
months ago was not easy of immediate apprehension—has
really, by frequent discussions, become so familiar to every
gentleman that it is not necessary for me to dwell upon
these points at that length which on previous occasions
perhaps it was my duty to do. Now the first error of the
right hon. gentleman has been touched upox to-night by
the hon. member for Huntingdon, and was frequently re-

ferrod to in the course of this discussion, and that was one
which has been constantly bpaught before the considera-
tion of the house and the committee, namely, his lowering
of the rate of interest upon Exchequer-bills. The right
hon. gentleman has on several occasions, and in that speech
in which I may say he introduced the resolutions now
under discussion, vindicated the course which he in-
teneded to take. I don't think that I am giving a par-
tial opinion if I say that the vindication of the right
hou. gentleman of that step has not, I think, proved
satisfactory to this house or to the country. No doubt
the observation of the right hon. gentleman, that in
the month of March the very fact that Exchequer-bills
were sent in, not for payment, but for conversion, is a
seeming vindication, as he states, of the measure that was
taken. No doubt on the first blush of the matter that is an
apparent answer to the charge that we had made. But
really it is a superficial ono, and has been noticed to-night
by the hon. member for Huntingdon, as might have been
expected from .. gentleman of his experience and acquain-
tance with the subject. It is not immediately that the
commercial community call on the Chancellor of the Ex-
chequer to pay his bills in money ; but although for a
moment this indulgence was extended to the right hon.
gentleman, the consequence of his conduct was so appa-
rent when at a later date, but still not remote period
a large amount of the balances in the Exchequer were
called for in the most inconvenient manner to defray the
obligations resulting from his policy. Well, sir, I shall not
dwell upon another point, which I only notice that the
house may bear it in its mind. It is a fact, not to be disputed
that the right hon. gentleman did think it a wise course to.
reduce the interest upon the public securities when the
bankers were raising the interest upon private securities,
and when every symptom which I think ought to have
guided the right hon. gentleman—such as the fall in the
funds, which the right hon. gentleman will no longer deny
--the double rise of the rate of interest in the Bank—the
fall in the premium on his own Exchequer-bills—must all
have warned him that a considerable change was taking
place in the fortunes of the money market. I think the
reason given by the hon. gentleman the other night which
he drew from the course of the exchanges affected by our
Indian trade, however good so far as it went, of a very
limited and partial character. There is no doubt that the
right hon. gentleman, as well as other persons, was misled by
the great increase in the production of the precious metals,
and that ho did not give credit for that remarkable increase
in our commercial transactions which was the consequence
of the discovery of that increase of the precious metals, and
which was an increase in greater proportion than the increase
' in those metals. Sir, I am quite willing to share the blame
of having formed an erroneous opinion on the same subject,
of which the right hon. gentleman of course has reminded
me. I answered the right hon. gentleman that it was my
opinion—an opinion that I had formed as to the low rate of
interest, and in which I was fortified by high authorities,
and the right hon. gentleman said—" Did not you have
these opinions, and of what use are opinions unless they
are acted upon?" But although that was my opinion in this
month of December, still I do think that in the month of
February, if I had been aware that the funds had fallen lA
per cent., if I had been aware that the Bank had raised the
rate of interest twice in the preceding month, and aware also
of the great efflux of the precious metals—that whatever
might be my theoretical opinions formed from study, and
although I thought that that might have been in the long
run justified by experience and the course of events—l think
I should have had sufficient caution and prudence not to act
then upon that opinion. Under these circumstances, and in
refusing so to act, I do not think I would have conducted
myself in a manner that would have given foundation for
the belief that I was insincere in the opinions I had yen- i
tured to express. Well, I consider this to have been the
first great fault in the management of our finances in the
year 1853—1 mean the incautious dealing with the un-
funded debt of the country. And although, at first sight,
the consequences which ensued from that step may not
have been so apparent as they have since proved to be, I
still believe that that must be accounted a very great error.
Sir, the second great mistake which the right hon. gentle-
man has made in the administration of our finances—l am
sure ho will pardon my going somewhat pedantically,
through this catalogue, but I am obliged now, from an ac-
cident which we all deplore, to answer in some degree a
speech made some time ago, and it is but due to the right
hou. gentleman and myself—and I do not shrink from the
task—l say the second great fault of the right hon. gentle-
mayss
? in the administration of the finances in 1853, was
e
that celebrated scheme of conversion which has occupied
committeethe
sometimes t t e n attention ot nfhoi of thefgott e countryforgotten,
evening.
because
e eaTheu s
scircumstances preventedo much,astne and also that of the
of that scheme is
only a very comparatively minor portion having been
fulfilled, or attempted to be fulfilled. But I must
again remark that the whole principles upon which
that scheme of conversion, which might ha re been ap-
plied to the whole amount of the public debt, was calcu-
lated,
,
in my mind, fallacious and contradictory
principles. (Hear, hear.) The right hon. gentleman has
reproached me and others because, in the month of
March, when he brought forward his conversion scheme,
we warned him of the impolicy of his greater scheme, and
dwelt little upon the inconvenience that might accrue from
the failure of his minor project Now, sir, Ido not shrink
in the least from the opinion that I then gave, that it was
extremely unwise to bind this country up in engagements
which were to last forty yea s, to ensure the stipulation of
a certain fixed rate of interest. whether it were 3 per cent.,
or 2A per cent., I should almost be tempted to go further—
, I say that the principle of an arrangement of a duration
such as was proposed by the right hon. gentleman was in
my mind a most imprudent one, and one which, whatever
may be the rate of interest ruling in this country at any
time, ought not under any circumstances to be sanctioned.
Sir, the right hon. gentleman reproached us that we did
I not remind him of the inconvenience that might arise to the
Treasury from the failure of the smaller portion of his con-
' version scheme, namely, the n,_Ncessity of having to pay off
the hoiders of south Sea Annuities. I think I may leave
1 the vindication of hon. gentlemen on this side of the house
to the hon. and learned member for Wallingford (Mr.
Maio) who has laid before the house soh ample quota.