The Sun.
London, England, 1860-06-23 00:00:00

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manded for the defence of oar coast and dockyards,
which cannot be supplied by ordinary taxation,
while there is a very confident expectation that in-
stead of a surplus there will he a defic!eat revenue.
The Finance Minister will be driven to a loan, end
fresh burdens will imposed to pay the
It is curious to observe that as Europe itch
aaccs in
civilisation one of its characteristics is increased
indebtedness. All its leading states arc
with this malady. No efforts are made to !cps),
old liabilities. Burrowing, not liquidating, i, the
order of tho day. _Russia wants a little accommo-
dation ; the purse of Sardinia requires replenish-
ment; the coffers of Austria arc empty ; nor will
it excite surprise should the French exchequer
stretch forth its hand to the metal of Australia:Jed
California. Demands of this character are fatal to
the independence of nations, for every loan resolves
itself into a tax on labour, and before industry cen
sustain itself it must, part with more of its earn-
ings. The payment of interest demands an exten-
sion of the hours of toil, and is, in a very eel Lin
though not obvious sense, the antagonism of may
closing and the short-time movement: There are
unfortunately loose writers and thinkers who ex-
press themselves lightly on these monetary opera-
tions, and even exult in the facility with which
money can be borrowed on account of the stability
of British credit, forgetting that as indebtedness
increases credit diminishes. The subject is the more
serious at this financial juncture, when the present
Government and their adherents are bent on chang-
ing the entire system of revenue by converting
iu-
direct into direct taxation. Shift the burden as
we may, it must either fall on Tiroperty or labour,
and one or the other must sink under these con-
stantly-expanding accumulations. The monied
classes, possessing themselves of the national in-
strument of distribution, must become dominant, as
the interest on the public debt becomes more ex-
acting and the trade necessities for discount become
urgent. When these are maximised—and we are
tending in that direction—the victory of the drones
over the bees will be complete. .But the triumph
will not be of long duration ' • the contrast between
gilded idleness and squalid labour is not permitted
to continue—it meets its doom either in the wretch-
edness of an enfeebled slavery, under which pro-
duction expires, or in the unrestrained furies of a
devastating revolution. We know not when the
fatal hour may come, but a year of famine is one of
its assured precursors.
National defence certainly justifies a loan, but
aggressive war can never be pleaded in its vindica-
tion ; and as we are now driven to this sad necessity
in an era of boasted civilisation, we must submit to
the infliction ; but it becomes the Legislature to
consider well the mode and the terms. We must
borrow the money from the richest among our own
countrymen, for they are the class who can advance
the funds ; and though they would suffer most were
a hostile army encamped in London, they are not
likely to lend their stores of gold without interest.
That disinterested quality of patriotism is not among
the virtues of the money market. The defence of
the country is there, a bargain. Bake et decorum
est pro-patria niori, is a pagan prejudice, which
meets no response among those who grow rich as
other classes are impoverished. " These," says Dr.
Johnson, "rejoice when obstinacy or ambition adds
another year to slaughter and devastation, and
laugh from their desks at bravery and science, while
they are adding figure to figure and cipher to cipher,
hoping for a new contract for a new armament, and
computing the profits of a siege or a tempest." We
have then to make a bargain, for we have perverted
the ancient reserve of an income tax, which earlier
wisdom held back for military and naval defence,
Under the burlesque of free trade we have parted
with our best resource in the hour of exigency, and
we are now to pay the penalties of our folly in a
new loan; so sure is it that the day of retribution
comes, though none may be able to fix its date.
At this crisis, then, it is well to look back to past
times when loans were not novelties, and finance
ministers were the dupes of contractors. Any one
who consults our history as it relates to the national
debt will soon be convinced that it was immensely
increased in amount by our 'paying to the monied
classes vastly more than they loaned. For instance,
the celebrated economist, Dr. Hamilton, who ex-
posed the bubble of the sinking fund, calculates
that the stock created between 1776 and 1786,
chiefly in consequence of war with our American
colonies, amounted :to £115,267,993, while tho
cash received into the public treasury was only
£91,763,842, showing as excess of stock or debt
registered over cash for all future time against the
public debtor of £23,455,668. This last sum, there-
fore, was a bonus conceded to the contractors or
extorted by them from the Finance Minister of
the period, being 26 per cent. in excess of what was
advanced. This was the system which called forth
the invective of Dr. Johnson. It was in this man-
ner that the monied class arose. All the loans
partook of this shameless character, sometimes by
douceurs, sometimes by premiums ; but the most
flagrant exhibition of this rascality occurred be-
tween 1793 and 1816; for, according to Mr. Mar-
shall's tables, on an average of all the loans of this
period upwards of £173 of debt was created for
every £lOO received. At the beginning of the year
1793 the funded debt stood at £229,614,466. In
the corresponding period of the year 1816 it stood
at £816,311,939, being a net increase during those
years of £586,697,493. Therefore, according to
Mr. Marshall, as £173 of debt is registered against
£lOO borrowed, it follows that the public Treasury
only received £339,131,500, where it was made
debtor for £586,697,493, and thus was bubbled out
of £247,565,993. These statements may appear
incredible, but they are arithmetically true. The
past is beyond recall; no equitable adjustment is
now possible ; the taxation interest on money never
received must be continued—but the facts narrated
may serve as a timely warning for the future, so
as to prevent the repetition of similar robberies.
When a Chancellor of the Exchequer enters the
money market as a borrower it is seen that a few
leading capitalists hold the Government at their
mercy—a state of dependency which will astonish
a more enlightened generation. He must so frame
his terms as to conciliate bankers and brokers ; in
his propositions he is not to think so much of the
welfare of the country as of the wishes of those who
are to be lured to subscription. For instance, ter-
minable annuities are not so marketable as those
which are practicably irredeemable. A 3 per cent.
loan is preferred to a 5 per cent. loan, as there is
less chance of the former rising to par, and so be-
coming liable to be paid off, than the latter. On
such points the lenders are to be consulted, and
also the class known as the " jobbers," who are
always ready to buy or sell, as the case may be,
for a turn in their favour of one-eighth per cent.
They, therefore, desiderate such a duality of stock
as is most rapidly negociable. A national debt must
differ in character from all other forms of mortgage.
It must serve the double purpose of an investment,
securing an annuity to those who merely look to an
assured income guaranteed by the Government ;
but it must also assume such a form, as was never
originally contemplated, as will enable dealers to
speculate in the instruments of national indebted-
ness. Without these conditions the subscriptions
would fail, and thus the spirit of gambling feeds on
public calamity. Our writers of light literature
have graphically iportrayed such operations, and
sketched even to caricature the'moral physiognomy
of the usurer ; but unfortunately no strenuous and
continuous effort has been made to put down the
system. It is true that Mr. Gladstone
a n
pro-
tested against loans, and insisted thatt hitehthe_hreaea vyeenaure
for the year should be collected
even
but he has never pointed out odebt
tt
tois
ethe operation could be effected.w
hinted how
i Others have
spoken of sinking
funds, but unless they are created
from
obviously s t•p l u s
idlefunds
process
theyroc
es s areto sheerontra delusions eal unsei sd ;
randeem an old one, paying with one hand while
borrowing with another, for the only true surplus
er o
rme
pmr oe ds
ei tn i
te
as
t,
No,
ef
which money is but the symbol
f
counter.

PROVISIONING GARRISON TOWNS.—At the re-
quest of the Commission on the Defences of the Kingdom
application was made to the authorities of certain garrison
towns to know what stock of food would ordinarily be
found in hand for the subsistence of the population if the
towns were suddenly shut up. From the answers of the
mayors of Portsmouth, Plymeuth, and Chatham it may be
mta.ekeekilsthe(atlnstuuiti
the
consumption
;ly of meat and cattle is not above a
and of breadstuffs, salt provisions,
and grocery, not more than would last from three to five
weeks, if so much; but the mayor of Plymouth adds, that
with a brief notice, perhaps of a single day, a supply of
food might be collected sufficient for at least six weeks'
consumption, and that he had ascertained from cop' etent
authority in the corn trade that with a w ek s notice
provisions might be obtained sufficient for three months.

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