The Sun.
London, England, 1840-07-20 00:00:00

The following are extracts from the Second Repoli
of the Committee of Spanish Bondholders :
" The Committee feel that, as creditors, it is tbeir
duty, and they have a right, to investigate and watch
ever the financial position and pecuniary transaetiout
their debtor. In the exercise of this duty the/ liens
made the proper inquiries, both of the contractors and
of the Government of Spain : in both cases replies have
been refused or evaded ; and this apparently stjtclied
concealment, as in private life, naturally tended to bevel
suspicions both of the resources, intentions, and opera-
tions of the debtors. Nor were these suspicion* con-
fined to the Chairman and those Mt.mbers of the Com-
mittee who visited him at their rooms : from time to
time the most alarming reports poured in from the eel&
tal of Spain itself, and from Paris, both in the public
prints and private letters. With every success of the
Duke of Vittoria in the field, public credit seemed to
sink in Madrid on the Bo:sa: Private letters without
number were addressed to the Chairman Calling his at-
tention to the impending danger ; and among others,
one of the 27th May, from a Member of the Cornarit-
tee, Mr. NV) llie, was submitted to his discretion, which
he thought of too great importance to be withheld
from the Committee ; and they, after due consid-ere-
tion of its contents, and that its information cams
through a source not seeking to depress Spanish credit,
nor interested in the ups and downs of its stock, but, to
use the writer's own words, to serve the Committee
of which Mr. Wyllie is a member, and induce them to
look with due consideration upon the actual position of
his unfortunate country'—resolved it should be pub-
lished in their second report, the only.dissentjent
Mr. Henderson, who deprecated sunk aleclosuris, raid
professed his ability to disprove seeeral of the state.
ments. On this, Mr. Willie himself moved that Mr.
Henderson should be allowed time to prepare his state-
ment of the debt and revenue of Spain, offering to with-
draw his letter if the Committee, on the receipt of Mr.
Henderson's statement, should consider right, the
general interests of the bondholders ; and the Commit-
tee agreed that they should re-assemble on the 15th, to
consider the statement which Mr. Henderson engaged*
to prepare by diet day, but they refused to cancel the
resolution already passed respecting Mr. Wyllie's lets's..
M. Wyllie's report on the debt of Spain at the com-
menament of last year is as follows :
a I

On the Ist of January, 1839, after
deducting the amount cancelled in
the purchase of national properties,

the Internal Consolidatend or Active

Debt of Spain, bearing 5 per cent.

interest, amounted to,' 4 Reales 4e
Velion' .
And the debt of the same descrip-
tion bearing 4 per cent. interest,
ditto

1,117,529,663,14

612,034,731,83

On the same day the Foreign Active
Debt. bearing 5 per cent, amounted

to, ditto .. -

" Making in all, Reales de Vellon 5,419,748,583,1 r
" On nhich the interest, at the above rates, if paid
amounts to 265,867,081 annually.
" On the same day, and after making
the same deduction for amounts
cancelled in the purchase of na-
tional Properties, the Internal De-
ferred Debt, not bearing interest,
amounted to' Reales de Vellon' 9,533,884,347,21
The Internal Passive, not bearing
interest, to, ditto
" The Deferred Foreign, ditto, ditto 1,139,384,000,00
" And the Passive Foreign, ditto, ditto 1,294,960,000,00

Making in all, ' Reales de Velion' 12,429,133,322,09
And adding debt bearing interest... 5,419,748,563,13

" Grand total; Reales de Velkoz' ... 17,849,581,905,22"
" Which at 20 per dollar, and estimating the dollar at
4s. 2d., amounts to the enormous sum of 1.85,933,1441.
sterling.
" But this is not all : my informa:.t writes, We must
add the amount of the Active Bonds created, and
clandestinely' issued (puesta en cireula(i9u),by Senor
Mendizabal ; the creations of the last Minister, San
Millen ;' and those for which the present Minster,
Santillan,' solicits the sanction of the Cortcs. My in-
formant further says,' We ought also to bear in mind
that the Internal Passive Debt increases daily, and that
what the Government will have to recognise of the
finite' claims against the Treasury, is an amount which
cannot easily be calculated.
" It would appear that, from 31st of December, 1838,
no proper balance had been struck ; but my correspond-
ent (who has the means of knowing fully what he says)
states that the clandestine' issues already made, and
the creations now projected, will about equal the whole
amount cancelled by the sales of natiorsal properties
subsequently to that date, leaving 186,000,000/. as
the probable total debt of Spain at the present moment,
subject to the daily increases and the 'infinite' as 3eo
unsettled claims just mentioned.
" Now, I hold that, added to the indispensable ex-
penses of the public service, the public debt of Sp-,in
already far exceeds her present means of payment ; and
that it becomes the duty of the committee over which
you preside, by every means in their power, to discou-
rage ard prevent any nezv loan which the Government
may propose. lam informed, and I believe, that the
whole net revenue, when well collected, does not exceed
600,000,000 reales de vellon,' 6,250,000/. sterling. Hew
far this goes beyond the demands of the state, even its
years of peace, I am not prepared to say ; but it must
be evident to every one that it would barely suffice for
an annual dividend of about 3 per cent. upon the whole
debt of Spain, if bearing interest as it at present stands,
and that, under such circumstances, any addition to
that debt robs those who lend it, and only proportionally
accelerates her progress to national bankruptcy."
The following letter has been addressed by the chair-
man, Richard Thornton, Esq. to Lord Palmerston.
" Old Swan, April 10, 1840.
" My Lord,—Agreeably to the promise I made on
the .sth instant, I have now the honour of submitting
to your Lordship the opinions I entertain, in common
with several other influential merchants, on the subject
of the financial difficulties of Spain, and the means which
exist, immediate and prospective, for ameliorating her
condition.
" Much of the derangement which has affected, and
continues to affect Spain, is to be attributed to a long
period of mismanagement and mal-administration of her
finances, together with the total absence of proper com-
mercial re6ulations. The corruption and immorality of
some of her Ministers, and the grasping covetousnegs
of agents and loan contractors, arc as notorious as they
are lamentable, and I consider it perfectly useless to
advance to Spain one real more while the present Sean-
oial system remains unreformed. The practice of bor-
rowing money on usurious terms, the exchange of one
promise for another, or of ctne piece of paper for Qtr.
other, cannot be too strongly deprecated ; it tends only
to enrich jobbers and speculators, at the expense of
those whose interests ought solely to be kept in view.
" It is universally admitted that Spain has immense
resources, which, if properly developed and applied,
would in a very short time enable her to surmount her
difficulties. lam of opinion that the best assistance
which friendly nations can give to Spain is an example
of morality, the advice of a good system of po-
litical economy, and an unequivocal disposition to pro-
mote her prosperity by a fair commerce. The interests
of Spain, of her creditors, and of the nations friendly
to her would be best consulted by establishing a system
that would benefit all. For instance, such as opening
three or four ports, such as Cadiz, Barcelona, Corunna,
Bilboa, or any others, for the introduction of manufac-
tures and other articles, the productions of friendly Ras
tions ; that is, such powers as shall acknowledge thn
Queen of Spain, establishing an import duty of not
less than 25 or 30 per cent., as might be agreed upon.
A simultaneous arrangement of this sort might also
combine a plan for gradually defraying the external debt
of Spain, by a provision for the over-due coupons being
received in part payment of duties in all the ports to
which the treaty might extend. At present it is esti-
mated that aboutfour-fiftbs of the imports are introduced
by the demoralising system of smuggling, in which
illicit trade about 300,000 Spaniards are employed, most
of whom might be brought to habits of industry, and
the immense and varied productions of Spain might be
cultivated and exchanged for other commodities, instead
of being left inert in the soil. Comfort and prosperity,
now unknown, would result from an active track., and
the greatest ;possible benefits would arise both to Spain
and her now suffering creditors.
" I doubt not, my Lord, that your Lordship and teiy
Lord Clarendon will agree in the correctness of my
views ; and as I am of opinion that two more Compe-
tent or conversant statesmen cannot tae found, I trust
your Lordship will give the subject your serious consi'
deration, the more so as I am persuaded a more fitting
opportunity could not present itself; as on the part of
France, Monsieur Titters, I am sure, would lend his
willing and enlightened co-operation ; indeed every per-
son interested in the welfare and fate of Spain, either
directly or indirectly, ought to exert his influence in
pursuit of ol.jccts of such great commercial importance.
based as they would be upon equitable and reciprocal
interests.
" I have the honour to remain, my Lord,
" Your Lordship's most obedient servant,
"RICHARD THORNTON."
" To the Right Hon. Lord Viscount Paltnerston."
dcsireofthe Committee,ie h ultimo, area
M 1
15th
Hletndeorson'f;
reportAt the
vs•as forwarded to them on the
his estimate is-
-54,716,9501,3.37163
Reels
Irnetreeringabl D
d debte
b
t
.
..
..
..
. .
..
.......
On which he observes that the resources of Spain are,
in his opinion, quite equal to the payment of the chitty
on such a debt, if properly managed and husbanded.
Mr. Richard Thornton 'a return makes the total
121,909/.
Clf7u;ther states :
debTthoefirSrpeapionr2t
4, The bondholders will observe that the Committee
not only allowed Mr. Henderson every opportunity to
refute the statements in Mr. \Vyllie's letter of the 27th
of May, but through other sources endeavoured to pro-
cure accounts such as might give some assurance of
accuracy to the bondholders. Their foregoing letters
of the 18th and 22d of June to Messrs. Ricardo