The Hawaiian gazette., 1869-08-04

Prom the London Mail of May sth.l

An instructive glimpse of European pol
itics may be caught from the figures of the
North German Budget as detailed in cor
respondence from Berlin. Even that econom-
ical and thrifty Confederacy over which Prus-
sia presides, is now in financial difficulties.
The Federal Budget, like the Budgets of so
many other States, shows a deficit. The ex-
penditure for military and naval purposes,
has been increasing; the revenue, owing to
the prosecution of these very purposes, is
on the decline. 1t is the universal story.
Wars and rumors of wars press on the ex-
chequer, while trade stagnates, industry Ian
guishes, and taxes, necessarily, fall of in
productiveness The Prussian figures are,
doubtless, on q small scale compared with
the accounts of other nations. nor need it be
imagined that any serious difficulty will be
found in re-establishing the equilibrium de-
sired, but the case, as far as it goes is pre-
cisely that of other countries at this critical
conjunctUre.
According TO the constitution of the young
Confederacy, the Federal Government de-
frays, from Federal income, the charges of
the Army and Navy, with other small ex-
penses; but, in the event of this income
falling short of the expenditure, the States
of the COnfederacy are bound to make up
the deficit by contributions proportioned to
their means For the current year, the Fed
eral expenditure is estimated at something
less than el2, 900, 900, whereas il is not ex-
pected that more than eS, 900, 900 will be
yielded by the Federal revenue. A balance,
therefore, of some "a coo, 900 would remain
to be provided by the several States of the
Confederacy, and this prospect is regarded
with considerable perpleXity. 1t is not com
petent to the Government-so we are assured
to retrench its expenditure, and, in fact,
the proposed outlay has already been sane
toned Considering the recent convulsions,
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Kingdom by the supposed hostility of Aus
tria and the jealousy of France, Prussia,
which stands for five-sixths of the Fedora
tion, was compelled TO be OH her guard, and
q demand of ell 100000 for the Army and
Navy Estimates, was not, under such cir
cumstances, unreasonable. 1t follows, there
fore, as the outgoings could not be curtailed,
that the income must be increased, and such
increase can only come from taxes or loans.
The view, however, taken by the Germans of
this alternative, and OF the various exigencies
involved, is exceedingly characteristic.
1t would not be difficult to borrow, for
Prussian credit is good; but the credit of
Prussia is good for the very reason that bor-
rowing has never been in favor with her
people. The Germans see, clearly enough,
that the system of meeting yearly deficits by
yearly loans would lead to national embar-
rassment, nor can tney persuade themselves
that the present need is altogether excep-
tional. 1t is too likely that the balance at
the next reckoning would be found still
against them; in other words, the demand is
OF kind to be met rather by permanent
than casual increase of revenue-by taxa
tion, that is, and not by loan. The Federal
Parliament did, it is true, authorize a small
loan for new ironclads, and the remainder of
loan contracted in 1867, is still available to
q slight extent for the service of the current
year. But beyond these transactions-mod-
crate enough in comparison with the deal
ings of other States-the Germans will not
go, and SO nothing but taxation is left for
them At this point, however, their re-
sources are unusually varied.
AS the deficit is Immediately occasioned
by the insufliciency of the Federal income to
meet the Federal expenditure, ii is obvious
that the balance might be redressed by in>
creasing this particular revenue as distin-
guished from the contingent contributions
of the Confederate States. The income in
question is drawn mainly from Customs-the
profits of the post-office and the telegraph,
which also belong to the Federal Exchequer,
being hardly worth mention. These Gus
toms, therefore, might be increased, and that,
il seems, is the policy in favour with the
Government But here constitutional
difficulty arises. The Germans have not yet
won their political freedom. They have still
something TO sconquer and many popular
rights TO reclaim from the old military mon
archy, and they are fully sensible of the i'm
portance in such a contest of the command
of the purse. 1t happens, however, that
money granted to the Government in the
way suggested would be granted with very
few conditions, and would, in point of fact,
pass out of the control of the popular as
sembly almost as soon as voted. The cohse
quence Is that the Parliament objects to
pecuniary grants, producing no political con-
oi1 nd fhnuUIa II unuld ha DIV tn
vote annual supplies, it is not disposed to
provide the Government with permanent
taxes. On the other hand, the resort TO the
individual States of the Confederacy is by no
means a popular eXpedient. The contribu
tions thus levied fall with great severity, not
to say inequality, and the power of the pub
lie to support taxation appears to be on the
wane. AS there has always been deficit on
the Federal account, appeal has always been
made TO the several States, but the demand,
unfortunately, becomes heavier and heavier,
and is. this year something like a million
above the last reauisition. Besides, the State
taxes, it is said, are yielding less and less-a
proof that taxation has reached its limit.
North Germany is not among the most
highly-taxed countries in the world, but we
can readily believe that the Germans are un-
easy under their increasing obligations and
diminishing resources, nor could any stron-
ger evidence be given of the malady which is
now affecting Europe 1t is not alleged, or
even suspected, that the Government is
spending too much; on thisSground the fru-
gal traditions of the monarchy and the race
give sufficient assurance. Prussia, indeed,
"did her conquests cheap" but, for all that
the cost is felt, and not so much in the mere
outgoings of the State as in the political con-
ditions which weigh upon its industry and
reduce its income Year after year taxes be-
come less fruitful than before, simply because
confidence is destroyed and enterprise para
lyzed by incessant expectation OF war. These
rumors and dangers, whether real or other
wise, act with double weight upon the com
munity. They compel the Government
however prudently 1t may be disposed, to in
cur fresh expenditure in warlike prepare
tions, and at the same time, by checking
trade and impairing credit, they curtail the
resources Of the taxpayers. Attentive OBJ
servers of passing events can hardly fail to
ask themselves how long this can last In
Germany itself the question has not yet as
sumed any alarming proportions. As the
Parliament is satisfied Of the reasonableness
of the Ministerial demands, it will doubtless
find way out Of its difficulty, and, ineeed,
the whole amount actually in question would
appear in our eyes rediculously small But
the importance of the case consists In the
fact that even in thrifty and economical Prus-
sia that pressure is felt which has carried
other states to the brink of financial ruin.
Even in North Germany, with all the pru-
dence of the people, and all the care of the
Government, more money goes ont and less
money comes in. No policy, however fru-
gal, can stand against the conditions of in
terDational life which keep all States armed
to the teeth in expectation of war So long
as each great power thinks million soldiers
necessary to its existence, so long will Bud
gets be characterized by deficits, and indus