The Hickman courier. [volume] (Hickman, Ky.) 1859-current, 1882-11-24
The British Debt.

'+< 4sAltlel Debt,
The popt4ar conception of the Nation-
al debt IS ti;2t u amounts on a rough es-
innate 70 te00, 100000. and that all
efforts tered it have touched onlv n
srf1slI frsfe<fen OF it. The accounts. how
ever. pro9e sat for the past quarter of a
century iK act Since the windino-uo
Of the cIistSges of the Crfmean War
the reGuetidSf Of debt has gone ON stead
ilv from<ye to year. In IS57-'58 the
total amoailt was f83J, ,O00,0 900: in 1855
,66. at the close of Mr.. Gladstone s most
brilliant perfod of financial adninistra-
tion. it was Brought down to fSl5. 0O0.-
600: IN 1868 81. when the Conserva-
tives hadI}kId Office for three years. it
had failed f1 ES03, 000. 900; in 1874.
: orasster advance had been made and
the debt stood at .f752, ,0OO, 600; and in
IS75-' rs. the process having been unin-
terrupted BY tire change of Governments.
At 9773, ,oD0.Q90. At this point there
was turn = The tide, due mainly to the
exigeacias foreign politics, and until
the last iincpt5al wear. lS8l-'82 the debt
nevaf so II X low q figure as in 1876
Testss { rgisz-ss 6e.: 760se e10, and
for the present year the osicial estimate
fixes the zmount at c763, ,0eo. OOO-that
is, f76, 600, 900 less than the 'e4sbt as it
stood five-and-twenty years ago.
This is not an inconsiderable rec-4e-
ton, even if the character of the burden
were precisely the same as that to which
the Nation was subject at the close of
the Crimean war. But, as Mr.. Hubbard
has pointed out in one of his instructive
letters which was lately printed on this
subject, large part OF the debt created
in recent years, which has diminished
the apparent net reduction, is repre-
sented by certain valuable assets unlike
anything to be found on the right side
of the account of 1857. For example,
the pGrcllase of the rights and property
of the telegraph companies by the
State involved the creation of nearly
Eli, 900. 900 worth of stock, but in ex-
change for this the Government has OBJ
tanned possession of a paying concern,
at present actually yielding profit equal
TO the interest on the stock created for
this purpose, and giving fair promise of
much larger return. Again, the money
raised for the purchase of the late khe-
dives Suez Canal shares figures as a
temporary increase of the 0ebt in 1876;
but the shares, it IS admitted were al
ways full value for the "a, 600, 600 which
were paid for them. and are now, If it
were expedient to part with them, worth
a great deal more. NJ. de Lesseps re-
minded us the other day that the origi-
nal 500-franc shares are now worth
about 200 francs each in the open
market, and though of course the shares
held by the British Government stand in
a different position from the ordinary
shares. because interest et five per cent
is paid upon them by the Egyptisn Gov
ernment and not by the compafy, and
the regular coupons have been alienated
for several years to come, it is still OBJ
vious that they share in the increase of
value due to the success of the enter
prise. Another element in the debt
which is rather apparent than real is
the amount representing ''loans recov-
erable.' which Mr.. Hubbard reckons at
over f2S,000, 600. The official return
shows that in the quarter of a century
the total de@ sase il the debt, mot tax
ing into account the amount of debt ere
ated for special purposes" was over
81l9,000. 600 But the especial pur-
poses in question include such unpro-
ductive expenditure as that upon fortifi-
cations and army iocalization. which,
however necessary and defensibles have
procured the country nothing in the
shape of a realizable and recoverable
asset. Taking, however the assets that
may be properly set eff against debt
the telegraph property, the Suez Canal
shares, and the loans to public
bodies-there is sum of not less
than 943, 600, 600 to be substracted from
the E763, 600, 600, which is the nominal
amount of the debt at the present time.
Mr.. Hubbard insists upon another point
in which, he maintains, the official
figures unfairly exaggerate the burden
upon the community. The amount of
the ordinary stocks is computed at par,
and certainly there seems to be no reason
for assuming that the Government viii
be able to extinguish their three per
cents. below par. But besides the or
dinary stocks there are the terminable
annuities. which in calculating the capital
of the debt have to be reduced to cash
value. 1t is an easy actuarial operation
to determine the cash value of the ter
minal annuities. But in the official re-
turn it is estimated as if invested in
three per cent. stock at an assumed price !
of 1913. 1t is difficult to understand
why this imaginary conversion is made !
at price which has no practical relation
to the present value of consols. If the
government had really TO sell or buy |
three per cent stock, it would have to
deal upon the basis of Il price ranging |
within fraction, one way or the other, /
of par. Mr.. Hubbard appears to be
justified in his criticisms upon the incon-
gruity of Jumping together in the COM
putation of the aggregate debt ordinary
stocks and unfounded debt all reckoned |
as payable at par, and the capital value
of the terminable annuities supposed to |
be invested at nearly eight per cent |
below par. If the value of the termin-
able annuities be supposed to be repre-
sented ike the rest of the debt, by three |
per cent. stock at par instead of at 93.3, |
another deduction of over $4,000. 900 |
must be made from the total. In that !
case. the actual burden of the debt will |
be found to be about 971S, 900, 600, or
4120, 10000 less than the amount ow-
ing by the State quarter of century
go.-London Times.