Part 4

We have already observed, that out of the three last millions of inhabitants, 600,000 _capitalists_ only share among themselves the neat profits of the arts, and of cultivation. There remain therefore 2 millions 400,000 dependents, who look up, for their subsistence, to the caprice, the pride, or wants of those opulent men. Now out of that number of dependents under every denomination, servants, clerks, lawyers, physicians, &c. several thousands are to be reckoned, who, tired of their situation, put by constantly, part of the wages of servitude, in order to secure to themselves and their posterity a more free and less equivocal existence.—Would the State be benefited, were this class of men, as essential as any other parts of society, to bury, as it were, the surplus of their layings-out, till they should have amassed the sum they might think sufficient for their intended purpose?—Would not the money, thus lying idle, occasion a chasm in circulation, which would turn to the prejudice of trade, thereby deprived of part of its resources?—Besides, if the want of a chest, safe from the attempt of robbers, and other inconveniences, a chest which is not only a security for them, but affords an interest for the money therein deposited, should necessitate them prematurely to embark in some scheme foreign to their occupation, which must be either abandoned or neglected: would not that knowledge, which they have derived from experience in all matters relating to their primitive avocation, be entirely lost to the public?—A reimbursement therefore which would deprive that part of society, much more wretched and dependent than either the mechanic or the cultivator, of a resource which, from its certainty, induces the former to fulfill with more zeal and exactness, the duties they have imposed on themselves, would prove a measure as hostile to humanity, as it would be contrary to sound policy.

In the immensity of commercial operations, how many capitals to a considerable amount, unemployed during two, three, four, and six months, are indispensably wanted at the precise period! Would it turn out to the advantage of the State, if a considerable capital, useless for six months to the holders, and for the like space of time essentially wanted by those who possess none, should lie dormant in the proprietor’s chest, till time should give it life, and make it useful?

But it may be urged, a man buying stock in the public funds, would lend to the seller (were no such funds established) the sum which he gives for his purchase.—That he might do so, there is not the least doubt: But could he depend on receiving the money at the time appointed for the repayment? May not the best man to-day, be a bankrupt to-morrow, and break for a million; and if the enterprise, to the execution of which a merchant appropriates, to be paid in six months, that portion of his capital, which till then has been to him unprofitable, should require that punctuality which alone could insure its success, will not prudence compel him to give up six months interest, that his undertaking may not be left entirely to chance?—Will not the public have lost the fruit which might have been reaped from that dormant capital, had the owner been at liberty to dispose of it?—And, will the same public flatter themselves that the six months interest which the merchant was obliged to sacrifice, in order to secure the execution of his plan, will not be reckoned in the expenditure?

Some will say, with no small degree of acrimony, “How many drones are supported at the expence of the public funds! These are only an encouragement to idleness.”

But do the persons before spoken of, come within this description? And, if the man who has laboured in his youth, chooses to repose himself in his old-age, is this pretended idleness any thing more than that _otium_, that leisure, so justifiable, and so sweet, after a toilsome life, when the state of the mind, and of the heart, cease to make labour necessary?—And, supposing, that after his death his wealth devolves to an ideot, must the son of an industrious father, who has served the State both by his œconomy and labour, be deprived of his resource?

It might be objected, that my reasoning derives its force from the bare supposition of a total reimbursement, the possibility of which no one can admit; but were it subjoined, that, by acknowledging the impracticability of the measure, we suppose its expediency;—were it farther said, that the public papers have often spoken of, and do still point out as the readiest and surest way to effect it, _the application of the sponge_;—were it added, that the first geniuses of _England_, _France_, nay, of all _Europe_, have advanced, and do still maintain, that such a measure will one day or other become unavoidable;—then we should be forced to acknowledge, that it would be no inconsiderable service to humanity, to spare no endeavours to convince the people, that no greater ease, power, or happiness, would accrue to them, were the nation to resolve upon its own disgrace.

Nor would it, in my opinion, be a more difficult talk to prove, that from a real and gradual reimbursement, no other advantage could result, than bringing about by degrees and more imperceptibly, an evil which would prove equally unprofitable to all.

I set aside the outcry against the interest yearly paid to foreigners, as the produce of the sums vested by them in the funds, because I think ruin impossible, where the money borrowed at 4 or 5, is laid out at an interest of 6, 7, or even 10 _per cent._ I likewise overlook the declamatory complaints on the fate of the handicraft and husbandman; because the laws of _Lycurgus_ should be revived, or the government must confine itself to protect those two classes of men against every sort of private vexation, and to secure to them the trifling salary to which they are every where and forever doomed. In spite of avarice the salary must be raised, if the prices of every necessary should increase; and were these to fall in their value, mutiny itself could not prevent a diminution of wages.

That part of the people which truly deserves, and should engage the attention of government, is that crowd of dependents, in the other class, of which I have already spoken: like the cultivator and artificer, they have no other stock than the passions and wants of the _capitalists_. These would be much more wretched than the others, if the education they have received, carrying their thoughts constantly and in spite of themselves beyond the present moment, government should in a manner compel them to center them all within that narrow space. The merchant never has more in the funds than that portion of his capital, which, for the moment, is useless to his trade. The farmer, and the proprietor who manages his own estate, _considered under these two heads_, have at no time in the funds more than that portion of their capitals, the actual use of which upon the lands they cultivate, might turn rather to their prejudice than profit. The annihilating of the public funds, or, in other words, a partial reimbursement, a gradual discharge of the debt, could therefore affect those three orders of stockholders no farther than to deprive them of this way of increasing their capitals, without running any risk; and those are, undoubtedly, the smallest part of the sums which constitute the national debt. Which is, then, the order of citizens that receives the larger share of the interest funded for that debt? It is that multitude of dependents whom the political œconomy of society has doomed to toilsome occupations useful to that society, or to laborious studies, of which that very society daily reaps the benefit: it is to that multitude of widows and orphans of both sexes, whose future support the unfortunate class above-mentioned thought to have secured by means of the present privations which they had imposed on themselves: it is to those children whose elder brothers are in possession of all the family real estate, and whose parents hoped to have fixed their condition and settled their fortune by the only means that can effectually obviate, not the injustice of an unequal division, since it is admitted, but the inconvenience resulting from the indivisibility of the landed property, which devolves to the eldest.

Yet if, in a State, we must be father, brother, sister, widow, orphan, _capitalist_, in fine, or without a capital, but with the faculty of acquiring one; which, then, is the class of citizens interested in paying off, either totally, or in part and by degrees, the national debt, when once it is incurred? Besides, if the reimbursement cannot be effected but at the public expence, what advantage will the public derive from this operation?

_Objections of another kind against paying off the National Debt._

The nominal amount of a loan which nothing obliges us to repay, is a matter of a very little importance; the interest agreed upon for the borrowed sum, is the only thing that deserves attention. The total of the interest in _England_ is now about nine millions, three millions of which could not be procured but by laying taxes on those objects which had hitherto escaped the penetrating eye of the financiers, and by doubling or trebling the impost on those which appeared less liable to the inconveniences attending such an additional increase.

Before I examine in what mode the taxes operate, I shall suppose, for the satisfaction of the sensible and benevolent mind, that this formidable burden falls only on the consumer of such objects as are taxed. The only plausible aim of a reimbursement, is a diminution of the taxes which lie so heavy on that consumer; but the misfortune is, that the only means of refunding, is to devise new taxes, or increase the former ones. Besides, if this increase be trifling, the reimbursement cannot be effected in less than a century. I freely confess, that in this case, the proprietors of the public funds would be less aggrieved, having then sufficient time to think on the less disadvantageous modes of replacing their stock; yet, I repeat it, not less than a century would suffice to discharge that very debt; and the public being a little more burdened annually, than they would have been had not the project of paying off the debt been started, would have no other compensation for the additional burden, than the distant prospect of a general release in a hundred years.—If the intention is, to bring about that release within a period which, to the fiftieth part of the present generation, gives the hope of enjoying the effect of it, I agree, that by means of one million of additional taxes, and some financiering tricks, the whole debt may be liquidated within the space of 40 or 50 years; and then, that part of the present generation which may exist at that _most gracious_ period, will, perhaps, bless the hand by which it shall have been relieved. But would that same hand be, till then, entitled to the like blessings from the unfortunate who should be reimbursed, and from those at whose expence this operation would be effected?

A first difficulty attending the objects under examination, is, that on every head requiring an explanation, a multitude of questions occur, which must be previously discussed; yet, with the utmost candour I confess, that there is not one among them which is not above the extent of my abilities. I shall therefore offer my thoughts on the subject with all that diffidence which results from such a consciousness. Partly by chance, partly from some other circumstance, as little glorious almost, or as little humiliating, I have been so often in the right, and so often in the wrong, that I should not be now more surprised at the one than proud of the other.

Another inconvenience is, that a picture, which, in its _ensemble_, might hold out, through a thousand incorrections and as many essential defects, a grand subject which, to become generally interesting, seems to wait only for the pencil of a skilful artist, viewed, unfortunately, by pieces, (and indeed it cannot be viewed otherwise,) presents at each time, nothing but a singularity, an oddity, which will cease to be so only when brought near to another; and this last, nevertheless, will require the same indulgence in order to its being rightly understood. The picture which I have presumed to take in hand is, I think, nearly of this kind. My wish, and a bold one it is, would be, that no judgement be pronounced on any of the particular parts, till they have been seen all together; for there are but few of them which, till another has been examined, is not liable to very just objections: and under each head I have answered to those only which it was essential to refute, that the reader might be able to go through the whole of the exhibition, which, had the plan of it been presented in the first page, might have subjected the book to be committed to the flames without mercy, and, indeed, without much apparent injustice.

I now resume my subject, after a digression that may be looked upon as a preface, which the reader may perhaps think might have been spared.

In the age we live in, to justify a necessary impost, by the pretence of paying off the debt, would be, of all state manœuvres, the most unpardonable. To lay heavy burdens on the people now, so as to liberate them in the space of a century, is, independent of a great many more improbabilities, to suppose, in the plan of administration, an immutability which it cannot give itself, and which does not, nor ever can exist. To leave the individuals of a nation in possession of all, that it is not indispensable to take away from them, in order that, with what they have left, they may acquire that which it will be perhaps necessary to deprive them of, is a principle, the absurdity of which it would be no easy matter to evince; but, to crush them under such an additional weight of taxes as would be necessary to exonerate them forty or fifty years hence, would be, in my opinion, attempting a measure, some of the consequences of which have no doubt escaped the attention of the proposers.

What may be the immediate effect of a considerable reimbursement, which even solely depends on the produce of taxation, and by no means of a real increase of specie in the nation? It consists in refunding to the lenders a sum which must cease to be useful to them, till it is replaced somewhere else; and obliging them to vest it, without loss of time, on that portion of the debt which is not yet acquitted.—But this privileged portion, which, previous to the reimbursement, was supposed only worth 80, and produced four, (it may be observed that, in the numbers, which I fix upon, I only look for terms to explain my meaning) will be worth 90, and presently 100, yet will not bring in more than _four_. It may be answered, the stocks rise, public credit increases.—We are not yet come to this point; but the fortune of the repaid stockholders, which does not consist in a nominal capital, but in the revenue it produces, will therefore, in fact, suffer a diminution of one whole fifth. What will then become of that fifth of the taxed objects consumed by them, and which they can no longer purchase?—It will, in my opinion, be necessary either to put a stop to the manufacturing of that fifth, and throw so many hands out of employment, or else lower the prices, yet continue to levy the tax, and then the manufacturer will complain of the burden; or, in fine, this fifth, now useless to the nation, must be exported, and this adds to the first inconvenience resulting from the tax imposed for the reimbursement: for, after all, if taxation operates in the manner it appears at first sight to do, that is, if it diminishes the means of consumption, then, by laying 1,000,000 of taxes appropriated to the liquidation of the debt, you have diminished your home-consumption, it matters not of what articles; you have diminished it, and still more so by the incapacity, to which the creditors paid off are reduced, of consuming that which they did consume previous to the reimbursement. Your exportation, it may be said, is by so much more increased, and enriched.—Granted;—but at whose expence? Who is to profit by it? In what manner are the returns to be made?⸺When foreign trade augments in proportion to the increase of the produce and home-consumption, it is easily conceived, that if the money imported does not exceed the proportion necessary to answer that double increase, the progression being equal every way, each article (money among the rest) will keep up to its value; but if the number of representatives is increased without any addition being made to the objects represented, is not the price of representation thereby diminished? Or, in other words, if you add to the real stock of money in the nation, at the expence of part of your own consumption, (which is the object in question) will not the price of the other parts of that same consumption rise in spite of you?

Besides, by diminishing, in any quantity whatever, the general mass of home-consumption, (and in the present supposition you may well think that it has decreased, both by the tax imposed and the reimbursement made) have the sums appropriated to that part of the consumption, annihilated by you, been withdrawn from the circulation? If not, then by adding thereto the increase of that balance in your favour, which you pretend to receive from abroad, by what means can you prevent a general rise in the prices, in proportion, not only to the quantity of that fatal money imported, but also to that cash, which ought to have been buried under ground, that it might, at least, only prove useless, after the home-consumption has undergone the diminution occasioned by the reimbursement and taxes? This is not all; the unfortunate creditors who have been paid off, already reduced from five parts of what they enjoyed, to four only, will certainly, soon after you shall have put the said balance into circulation, become unable, with the _four_ that remain, to purchase more articles than they could have procured with _three_, previous to the tax and reimbursement.

Will you pretend to say, that this money does not circulate within the nation? that it becomes the source of a new trade? and that the exporters, instead of over-loading _England_ with that specie, send or carry abroad the value thereof from _Spain_ into _France_, _Germany_, and _Russia_?—that is to say, after having reduced the home-consumption, the exporters, who, rightly enough, are not willing to lose, will contribute to extend the internal consumption of _Spain_, _France_, _Germany_ and _Russia_, and of course _the ways and means_ of these different nations, as well as the produce of their taxes, in the same proportion as those objects have decreased amongst you.—Could this seriously be your intention?

But if it clearly appear, that the execution of the refunding plan would prove equally pernicious in its immediate tendency, both to the creditors who would be compelled to accept of it, and those at whose expence it must be effected, what then might be the case, if the interest of that debt, which ingrosses so much the public attention, being paid by _all_, were, in fact, paid by _no one_, but for so long a time as nature, assisted by all the calculations of individuals, may require to correct the errors of those upon a larger scale, _made by administration, when administration is capable of making any_.

_In what manner the Interest of the National Debt will be probably paid off._

It is the most generally received and best respected opinion, that taxes should in preference be laid on the articles of luxury. There is not a man possessed of the least feeling and honesty, who does not approve of this maxim, and whose wish has not often been that the wealthy only should pay the taxes. Canting enthusiasts further add, that the expence and luxury of the rich, prove the ruin of the nation. Be it so. But when the question is, to define what is luxury, in order to subject it to a tax, every individual exclaims, that it begins precisely with those articles which the mediocrity of his means, places above his reach. Instead of laying a tax on beer, would it not be better to increase that on hackney-coaches? says a porter who is stopped at a crossing, by one of the above vehicles; whilst the supposed idler who sits in the coach, and pays for it, exclaims, at the sight of a gilt carriage, that crosses and stops his way: What! 500_l._ laid out on a single article of luxury! Would it not be better to tax the owner by so much, and apply the produce to the maintenance of fifty poor objects during six months? But, my dear Sir, the manufacturing of this very carriage has maintained a far greater number. If you begin with the man who extracted from the mine, that gold, which, with indignation, you see glittering on the wheels; if it is not beneath you to notice the child employed in driving away the flies that might have hurt the gloss of the varnish when first laid on; and if you end your list only with those who, instead of horses, dragged the carriage into the coach-house of that stately man, whose pomp gives you so much offence; would it have pleased you more if all those hands had been paid for doing nothing? The rich man alone, say you, ought to pay the taxes: but it is impossible that they should be paid by others, “_if it be true, that every man, destitute of a capital, can pay nothing but at the expence of the capitalist_.”

It would be a difficult matter to trace out, with exactness, the progress of the taxes; but it appears to me, that whatever be the mode of establishing them, there is not a subject who does not contribute his share sooner or later, unless nature should annul the burden, even before the clashing of private interests should have succeeded in settling the division upon equitable principles.