CONTAINING REMARKS on some Particulars in a SPEECH at opening the BUDGET
in _April 1776_.
SECT. I.
_Supplemental Observations on the Surplus of the Revenue; the Quantity of
Coin in the Kingdom; and Paper-Credit._
It is well known, that the great minister who presides over our finances,
took occasion, at opening the Budget in April last, to enter into a
particular account of the state of the nation. In this account, he
represented us as in a condition the most sound and happy; our trade and
revenue flourishing; our common people well provided for; our debts and
taxes light; our current specie sufficiently ample; our paper-circulation
safe; and the BANK, in particular, as little less firm and durable than
the world.
This account, so encouraging and flattering, was generally understood
to be given in designed opposition to another account very different,
which had been given in the _Observations on Civil Liberty_.—It cannot,
therefore, I hope, be thought too presuming in me to offer the following
remarks in my own defence.
* * * * *
I have grounded my opinion of the hazardous state of the kingdom, partly
on the smallness of the surplus in the revenue, and the nature and
circumstances of our paper-circulation, compared with the quantity of
_specie_ in the kingdom, and the weight of our debts and taxes.
The surplus of the revenue I have made out in two different methods;
and by a deduction so minute, that it is, I think, scarcely possible
it should be materially wrong. One of these methods brings it out
338,759_l._ _per ann._[81]: and the other, 300,000_l._ _per ann._
supposing the expence of calling in the gold coin, and the profits of
lotteries excluded; the land-tax at three shillings in the pound; and
the peace establishment the same that it has been at a medium for eleven
years, from 1764 to 1775.
Nothing more was said in opposition to this, than a general intimation,
that had it not been for the war with _America_, the peace-establishment
for the navy would have been reduced, and a sufficient surplus gained
(including lotteries) to enable parliament to pay off a million every
year of the public debt.
* * * * *
I am very sensible that reductions of the public expences and
improvements in the revenue are practicable, which would give such a
surplus. But I am afraid, they will never take place. Nor can I think
it proper, in determining what permanent surplus we possess, to include
those pernicious profits of lotteries, by which infinitely more is upon
the whole lost than gained; or, to form our judgment of the expence of
_future_ years, by any other rule than the medium expence of _past_
years.—It would, however, give little consolation, were there a certainty
that, had peace continued, a MILLION annually of the public debt would
have been discharged. This would have made a very slow progress in
discharging our debts. A million every year discharged in peace, and
eight or ten millions every year added in war, would leave us under the
necessity of breaking at last. But hitherto we have not proceeded in a
course so favourable. The great person to whom I refer, must know, that
in 1772, he announced in the _House of Commons_, his intention to pay off
a _million and a half_ every year, and SEVENTEEN MILLIONS in ten years;
that yet only 2.800,000_l._ was paid off in the three subsequent years;
and that, on account of the increase of the _navy_ and _civil-list_
debts, there has not been in fact the ability (without the help of
lotteries) to pay half that sum.
* * * * *
In page 74th of the _Observations on Civil Liberty_, I have said, “that
it has appeared lately, that the gold specie of the kingdom, is no more
than about TWELVE MILLIONS AND A HALF.”—This assertion has been much
controverted; and it is therefore necessary I should give a distinct
account of the reasons on which it was grounded.
I had learnt from unquestionable authority, that the quantity of gold
coin brought into the mint, by the Acts of Parliament and Proclamations
in 1773 and 1774, was about NINE MILLIONS[82]; or as much as, when
recoined, amounted nearly to that sum.—I find also, that it was expected
by the best judges, that the proclamation lately issued would bring in
about _three_ millions. These two sums make up _twelve_ millions; and
they include the gold coin of _Ireland_. Let this be estimated at a[83]
million; and the whole gold coin of _Britain_, to be brought in by all
the calls, will be ELEVEN millions; and none will remain, except that
part which was deficient less than a grain in a guinea, and remained
in the kingdom, at the time the coin Act took effect in June 1773. We
are here left entirely to conjecture. But it should be remembered, that
for many years before 1773, the heavy coin was catched up as soon as
issued, and either clipped, or melted down and exported; and that from
hence arose such a scarcity of heavy coin, that, in some counties, heavy
guineas might be disposed of at a premium.—In such circumstances, an
allowance of about a million and a half, for the coin deficient less than
a grain in a guinea before the coin Act in 1773, seems to be sufficient;
and therefore, it might, I think, with reason be said, that it appeared
that the gold coin of the kingdom was about TWELVE MILLIONS AND A HALF.
* * * * *
But there is another reason, by which I have been convinced, that this is
a moderate estimate.
The quantity of gold coin, deficient between three and six grains in a
guinea, was 4.800,000_l._ and this, when recoined, made 4.600,000_l._—The
coin deficient less than three grains could not have been so much, for
the following reasons. First, new coin being rougher, wears faster than
old coin; and therefore, does not remain so long in any given degree of
deficiency.—Secondly, coin, deficient less than three grains, is subject
to several peculiar causes of diminution and destruction.—Clipping and
sweating remove part of it to greater degrees of deficiency; and part is
destroyed by being melted down and exported; whereas, lighter coin is
diminished only by being worn[84].
These reasons seem to prove, that if the gold coin, deficient in June
1773 less than three grains, is estimated at _five millions_, (that is,
at a little more than the coin deficient between three and six grains) it
will be rated rather too high; and the conclusion will be, that the whole
of our gold coin (exclusive of the _Irish_) might possibly be _less_, but
could not have been _much more_, than the sum at which I have reckoned it.
* * * * *
Such have been the facts and arguments by which my judgment has been
determined in this instance.—But it must not be overlooked, that it helps
only to ascertain the quantity of _circulating_ specie in the kingdom,
as distinguished from that which is _hoarded_. When the _Observations on
Civil Liberty_ were published, I did not apprehend, that this part of the
coin could be considerable enough to deserve regard. But the contrary has
lately appeared. The Proclamation issued last summer, and which it was
expected would bring in about three millions, has, I am informed, brought
in about _six millions and a half_. This exceeds the sum at which I have
been led to state the _whole_ gold coin deficient less than three grains;
and proves, that several millions must have been hoarded[85]. Nor, I
think, will this appear incredible, when it is recollected, that only
gold coin under three grains of deficiency is likely to be hoarded; and
also, that distrust of the _Funds_ and of Paper-money has a particular
tendency to increase the practice of hoarding.
Assisted, therefore, by this new light, I would now state the
_circulating_ gold coin of the kingdom before 1773, nearly as I did
before; and call it TWELVE or THIRTEEN MILLIONS. But the whole gold coin
(including the hoarded part) I would reckon at SIXTEEN or SEVENTEEN
MILLIONS[86].
* * * * *
An account very different from this was given at opening the Budget; the
substance of which I will state as faithfully as my memory will enable
me; and just as I understood it.
“From the beginning of the year 1772, to the 23d of April last,
13.200,000_l_. had been coined at the Tower; and on that day there was
600,000_l_. more ready to be coined.—All this, (it was intimated) is
now left in the kingdom. The last Proclamation, it was expected, would
bring in three millions more; which, added to the coin deficient less
than a grain resting in the kingdom at the time of the Coin Act in
1773, and issued before 1772, will make the whole, EIGHTEEN OR NINETEEN
MILLIONS[87].”
* * * * *
On this account I would observe,
First. That if just, it proves that, in 1773, a _third_ at least of the
_circulating_ coin was in the best state possible. For the late calls
having shewn, that there was then, in _Britain_ and _Ireland_, no more
than about twelve _millions_ deficient _more_ than a grain; six millions
(that is, a third of eighteen millions) or seven millions (that is, more
than a third of nineteen millions) must have been deficient _less_ than
a grain.[88]—It will also follow, (since the quantity brought in by
the first call is known to have been 4.900,000l.) that but little more
than a _fourth_ could have been deficient so much as six grains, or a
shilling in a guinea.—No person can think this credible who recollects
the distress of traffic, and the complaints of the kingdom before 1773.
Secondly. The truth of the account I have stated depends, in a great
measure, on the supposition, that all the gold coined since the beginning
of 1772 is now in the kingdom. I cannot conceive on what grounds this
was taken for granted.—From the beginning of 1772 to June 1773, the
practice of clipping was more prevalent than it had ever been. During
the greatest part of 1772, the price of gold was so much above mint
price, that a profit, from 2 to 4 _per cent_. might be got by melting
heavy guineas[89]. And, in February in that year, the price of gold was
at 4l. 1s. 6d. per ounce; and 4½ _per cent._ might be got by melting
heavy guineas. Instead, therefore, of believing, that all the gold coined
since the beginning of 1772 remains with us; I think it almost certain,
that the greatest part of all coined during the first year and a half of
this period, has been either clipped or melted into bullion. That part
which was clipped has been recoined; and that part which was melted has
been either recoined or exported; and, therefore, neither has made any
addition to the coin of the kingdom.
These observations demonstrate, that the amount of the gold coin at the
time of the Coin Act in 1773, must have been near the sum at which I
have reckoned it. There may, for ought I know, have been an increase
since; but I shall not believe there has, till I know, whether the coin
brought in by the last proclamation has been all recoined and issued. But
this cannot be expected; for should it be done, FOUR MILLIONS[90] more
will have been coined and issued, than has been brought in.—The truth,
therefore, may be, that the coinage, since June 1773, has been carried
on only to provide a supply of new coin to be exchanged for old; in which
case, the quantity of coin in the kingdom, even according to this method
of computing it, will come out nearly the same with that which I have
given.
* * * * *
After all, let the _specie_ of the kingdom, including the silver, be
allowed to be as considerable as some have asserted; or about four
millions more than I have reckoned it; the difference arising from
hence will not be of particular consequence; and it will be still true,
that notwithstanding all our increase of trade and apparent opulence,
the _specie_ of the kingdom[91] is not much more than it was at the
_Revolution_.—What then is all the rest of our circulating cash? What
is it keeps up rents; feeds our luxury; pays our taxes; supplies the
revenue, and supports government?—Paper, chiefly, emitted, not only at
the Bank, but by tradesmen, merchants, and bankers in every corner of
the kingdom.—And is this a solid and permanent support?[92] Is there,
in the annals of the world, another instance of a great kingdom so
supported?—The causes are numberless which may suddenly destroy it; and
were this to happen, we should fall at once, with a debt of 140 millions
upon us, to the state we were in before the REVOLUTION.—Imagination
cannot paint to itself the shock this would give.—I must repeat here
what I have said in the _Observations on Civil Liberty_, page 73, &c.
that we should think of nothing but guarding ourselves against the danger
of such a situation, by restricting our paper currency, and gradually
discharging our public debts.—In giving this admonition, I look upon
myself as doing my country one of the best offices in my power; and
acting in the character of one who calls to another to awake who is
sleeping over a precipice.—But I know I call in vain.—The great minister
who directs our finances has assured us all is well; and, under this
persuasion, we are advancing, with unsuspicious and careless speed, to
the catastrophe I have pointed out; and pursuing measures which must
increase the difficulty of avoiding it, and the distress attending it.
Among these measures I have mentioned the present new coinage.—Before
this coinage, I have observed, the light money always remained, because
nothing could be got by melting and exporting it. But now, as soon as
gold rises to the price it bore for many years before 1773, the melters
and exporters of coin will be saved the trouble of selection; and
every piece on which they can lay their hands will be proper for their
purpose.—It seems, therefore, obvious, that, in consequence of this
measure, all our coin may be carried away, and the whole superstructure
of paper supported by it, break down, before we are aware of any danger.
I will take this opportunity to add, that this measure will at the
same time increase our paper. This has been the consequence of the two
former calls; but it will probably be more the consequence of the last
call. For, as no coin is now to be current which is more than a grain
deficient; and as also a great deal of it is already at or near that
limit; the vexation attending it will be so intolerable, that it will
be generally cried down, and paper substituted in its room.—Certain it
is, that nothing can prevent this evil, but another evil; I mean, the
deficient coin forcing itself again into circulation, and furnishing
clippers with more employment than ever; and, consequently, a return,
with increased violence, of the confusion and distress which took place
before the Coin Act in 1773.—This, indeed, will be much the least of the
two evils; nor, in my opinion, are there any methods of preventing the
diminution of the coin, which will not produce greater evils, except such
alterations in its form[93] as shall render clipping less practicable,
joined to the execution of severe laws against clippers, and a strict
vigilance in detecting them.
Upon the whole, it seems to me, that enough had been done by the
first coin act to restore the gold coin; and that all which has been
done since, at the expence of about 650,000l. has been nothing but a
preparation of the coin for melters and exporters, to the dreadful hazard
of the kingdom.—These are my present views of this subject. But I must
say, that I suspect my own judgment in this instance. The noble Lord,
who is furnished with infinitely more of the means of information than I
am, intimated, if I remember rightly, that there is no such danger: And
though I did not understand the reason he assigned for this assertion,
I must believe, that, in a matter so particularly interesting to the
kingdom, he has gone upon the best evidence.
SECT. II.
_Of the State of the Nation; and the War with America._
At the beginning of the preceding section, I have taken notice of the
flattering account which was given, at opening the Budget in April last,
of the state of the kingdom with respect to its commerce, revenue, and
opulence. On that account I shall beg leave to offer the following
reflections.
* * * * *
First. The observations in the last section prove, I think, that it
is not so well supported by facts, as there is reason to wish. I am
sensible, indeed, that we never made a more gay and splendid appearance.
But no considerate person will draw much encouragement from hence. That
pride and security; that luxury, venality and dissipation which give us
this appearance, are melancholy symptoms; and have hitherto been the
forerunners of distress and calamity.
Secondly. When this account was given there was a particular end to
be answered by it. Additional taxes were to be imposed; and it was
necessary to reconcile the public to the prospect of a great increase
of its burthens, in order to carry on the war with _America_.—On other
occasions, different accounts had been given. In order to prove the
justice of taxing the _Americans_, the weight of our own taxes had been
often insisted upon; and the difficulty of raising a sufficient force
among ourselves to reduce them, had been urged as a reason for seeking
and employing, at a great expence, the assistance of foreign powers.
On such occasions, I have heard our unhappy and embarrassed situation
mentioned; and, at the end of the last session of Parliament, one of our
greatest men, whose opinion in favour of coercion, had contributed to
bring us into our present situation, acknowledged the distress attending
it, and represented the vessel of the state as having never before rode
in so dangerous a storm.—This is, without doubt, the truth. But, if the
account on which I am remarking was just, we were then safe and happy;
nor was the vessel of the state ever wafted by more gentle and prosperous
gales.
But the reflection which, on this occasion, has given me most pain is the
following.
If, without _America_, we can be in a state so flourishing, a war to
reduce _America_ must be totally inexcuseable. I wish I could engage
attention to this. War is a dreadful evil; and those who involve a people
in it _needlessly_, will find they have much to answer for. Nothing can
ever justify it, but the necessity of it to secure some _essential_
interest against unjust attacks. But, it seems, there is no interest
to be secured by the present war. The revenue has never flourished so
much, as since _America_ has been rendered hostile to us; and it is now
reckoned by many a decided point, that little depends on the _American_
trade. It follows then, that if the end of the present war is to “obtain
a revenue,” it is a revenue we do not want; if “to maintain authority,”
it is an authority of no use to us.—Must not humanity shudder at such a
war?—Why not let _America_ alone, if we can subsist without it?—Why carry
fire and sword into a happy country to do ourselves no good?
Some of the very persons who depreciate the value of the colonies, as a
support to our revenue and finances, yet say, that we are now under a
necessity of reducing them, or perishing. I wish such persons would give
an account of the causes which, according to their ideas, create this
dreadful necessity. Is it the same that led _Haman_ of old to reckon
all his honours and treasures nothing to him, while _Mordecai_ the Jew
would not bow to him?—Or, are we become so luxurious, that luxury even
in the revenue is become necessary to us; and so depraved, that, like
many individuals in private life, having lost _self_-dominion, we cannot
subsist without dominion over _others_?
It must not be forgotten, that I speak here on the supposition, that
it is possible for this country to be as safe and prosperous without
_America_ as some have asserted, and as was implied in what was said at
opening the last Budget.—This is far from being my own opinion.—Some time
or other we shall, in all probability, feel severely, in our commerce and
finances, the loss of the colonies. As a source of revenue they are, I
think, of great importance to us; but they are still more important as
supports to our navy, and an aid to us in our wars. It appears now, that
there is a force among them so formidable and so growing, that, with its
assistance, any of the great _European_ powers may soon make themselves
masters of all the _West-Indies_ and _North-America_; and nothing ought
to be more alarming to us than that our natural enemies see this, and
are influenced by it.—With the colonies united to us, we might be the
greatest and happiest nation that ever existed. But with the colonies
separated from us, and in alliance with _France_ and _Spain_, we are no
more a people.—They appear, therefore, to be indeed worth any price.—Our
existence depends on keeping them.—But HOW are they to be kept?—Most
certainly, not by forcing them to unconditional submission at the expence
of many millions of money and rivers of blood. The resolution to attempt
this, is a melancholy instance of that infatuation, which sometimes
influences the councils of kingdoms. It is attempting to keep them by a
method, which, if it succeeds, will destroy their use, and make them not
worth the having; and which, if it does _not_ succeed, will throw them
into the scale of rival powers, kindle a general war, and undo the empire.
The extension of our territories in _America_, during the last war,
increased the expence of our _peace_-establishment, from 2.400,000l. _per
ann._ to four millions _per ann._—Almost all the provinces in _America_,
which used to be ours, are now to be conquered. Let the expence of this
be stated at 25 or 30 millions; or, at a capital bearing a million
_per annum_ interest.—_America_ recovered by the sword must be kept by
the sword, and forts and garrisons must be maintained in every province
to awe the wretched inhabitants, and to hold them in subjection. This
will create another addition of expence; and both together cannot, I
suppose, be stated at less than two millions _per annum_.—But how is
such an increase of revenue to be procured?—The colonies, desolated and
impoverished, will yield no revenue.—The surplusses of the sinking fund
have, for many years, formed a necessary part of the current and ordinary
supplies.—It must, therefore, be drawn from _new_ taxes.—But can the
kingdom bear such an increase of taxes? Or, if it can, where shall we
find a surplus for discharging an enormous debt of above 160 millions?
And what will be our condition, when the next foreign war shall add two
millions _per annum_ more to our expences?—Indeed this is a frightful
prospect. But it will be rendered infinitely more frightful by carrying
our views to that increase of the power of the Crown which will arise
from the increase of the army, from the disposal of new places without
number, and the patronage of the whole continent of _North-America_.
These consequences have been stated moderately on the supposition, that
we shall succeed in subduing _America_; and that, while we are doing
it, our natural enemies will neglect the opportunity offered them, and
continue to satisfy themselves with assisting _America indirectly_.—But
should the contrary happen.—I need not say what will follow.
Some time ago this horrid danger might have been avoided, and
the colonies kept by the easiest means.—By a prudent lenity and
moderation.—By receiving their petitions.—By giving up the right we
claim to dispose of their property, and to alter their governments.—By
guarantying to them, in these respects, a legislative independence;[94]
and establishing them in the possession of equal liberty with
ourselves.—This a great and magnanimous nation should have done. This,
since the commencement of hostilities, would have brought them back to
their former habits of respect and subordination; and might have bound
them to us for ever.
MONTESQUIEU has observed, that ENGLAND, in planting colonies, should
have _commerce_, not _dominion_, in view; the increase of dominion being
incompatible with the security of public liberty.—Every advantage that
could arise from commerce they have offered us without reserve; and
their language to us has been—“Restrict us, as much as you please, in
_acquiring_ property by regulating our trade for your advantage; but
claim not the disposal of that property after it has been acquired.—Be
satisfied with the authority you exercised over us before the present
reign.—PLACE US WHERE WE WERE IN 1763.”—On these terms they have
repeatedly sued for a reconciliation. In return, we have denounced them
_Rebels_; and with our fleets in their ports, and our bayonets at their
breasts, have left them no other alternative than to acknowledge our
supremacy, and give up rights they think most sacred; or stand on the
defensive, and appeal to heaven.—They have chosen the latter.
In this situation, if our feelings for _others_ do not make us tremble,
our feelings for _ourselves_ soon may.—Should we suffer the consequences
I have intimated, our pride will be humbled.—We shall admire the plans of
moderation and equity which, without bloodshed or danger, would have kept
_America_.—We shall wish for the happiness of former times; and remember,
with anguish, the measures which many of us lately offered their lives
and fortunes to support.
* * * * *
I must not conclude these observations, without taking particular notice
of a charge against the colonies, which has been much insisted on.—“They
have, it is said, always had independency in view; and it is this,
chiefly, that has produced their present resistance.”—It is scarcely
possible there should be a more unreasonable charge. Without all doubt,
our connexion with them might have been preserved for ages to come,
(perhaps _for ever_) by wise and liberal treatment. Let any one read
a pamphlet published in 1761, by Dr. _Franklin_, and entitled, _The
interest of Great Britain with respect to her Colonies_; and let him deny
this if he can.—Before the present quarrel, there prevailed among them
the purest affection for this country, and the warmest attachment to the
House of HANOVER. And since the present quarrel begun, and not longer ago
than the beginning of last winter, independency was generally dreaded
among them. There is the fullest evidence for this; and all who are
best acquainted with _America_, must know it to be true. As a specimen
of this evidence, and of the temper of _America_ till the period I have
mentioned, I will just recite the following facts.
In the resolutions of the _Assembly_, which met at _Philadelphia_,
July 15, 1774, after making the strongest professions of affection to
_Britain_, and duty to their sovereign, they declare their abhorrence of
every idea of an unconstitutional independence on the parent state.—An
assembly of delegates from all the towns of the county of _Suffolk_
(of which _Boston_ is the capital) delivered in September 1774, to
General Gage, a remonstrance against fortifying _Boston-neck_. In this
remonstrance, they totally disclaim every wish of independence.—The same
is done in the instructions given by the several colonies to the first
deputies chosen for a general Congress.—In the petition of the first
Congress to the King, they declare they shall always, carefully and
zealously, endeavour to support and maintain their connexion with _Great
Britain_. In the memorial of the same Congress to the people of this
country, they repeat this assurance.—In the order of the _Congress_,
which met in May 1775, for a general fast, they call upon all _America_
to unite in beseeching the Almighty to avert the judgments with which
they were threatened, and _to bless their rightful Sovereign_, that so
_a reconciliation might be brought about with the parent state_.—And in
their declaration setting forth the causes of their taking arms, they
warn us, “that, should they find it necessary, foreign assistance was
undoubtedly attainable;” but at the same time declare, “that they did not
mean to dissolve the union which had so long and so happily subsisted
between them and this country; that necessity had not yet driven them
to that desperate measure, or induced them to excite any other nation
to war against us; and that they had not raised armies with ambitious
designs of forming independent states, but solely for the protection of
their property against violence, and the defence of that freedom which
was their birth-right.”—In the instructions, delivered Nov. 9, 1775, by
a committee of the representatives of the province of _Pensylvania_, to
their delegates in the third general congress; they enjoin them, in
behalf of the province, “utterly to reject any propositions, should such
be made, that might lead to a separation from the mother country.”
What reason can there be for thinking the colonies not sincere in
all these declarations?—In truth; it was not possible they should be
otherwise than sincere; for so little did they think of war, at the
time when most of these declarations were made, that they were totally
unprepared for it: And, even when hostilities were begun at LEXINGTON
in April 1775, they were so destitute of every instrument of defence,
particularly ammunition, that _half_ the force which is now invading
them, would have been sufficient to conquer them at once.
I will beg leave to add on this occasion, the following extracts from
letters, written by some leading persons at NEW-YORK, the genuineness of
which may be depended on.
_New-York, August_ 3d. 1775.—“I am sensible of the many artifices and
falshoods which have been used to biass the minds of your countrymen,
who believe evil reports of us; and, particularly, that we are aiming at
independence.—Of this be assured, that even HANCOCK and ADAMS are averse
to independence. There was a lye current last week, that the congress had
finally agreed upon independence to take place the 10th of March next,
should not our grievances be redressed before that time. I wrote to one
of our delegates, to enquire whether this report was true. In his answer
he declares, upon his honour, that he believed there was not one man in
the Congress who would dare to make a motion tending to independence; or,
that if any one did, two could not be found to support the motion.—None
but those who are on the spot can conceive what a spirit is gone forth
among all ranks and degrees of men.—We deserve to be free. It is a heavy
sacrifice we are making. Trade is at an end. We expect our city to be
knocked about our ears. But I declare solemnly, I will submit to all,
and die in a log-house in the wilds of America, and be free; rather than
flourish in servitude.”—In a subsequent letter, dated NEW-YORK, Jan.
3d. 1776, the same person writes as follows:—“It is in the power of the
ministry to annihilate all our disputes, by restoring us to the situation
we were in at the conclusion of the last war. If this is done, we shall
immediately return to our allegiance. But if not, be assured, that an
awful scene will be opened in the spring. Let me repeat a caution to you;
believe not the insinuations of our enemies, who would make you all
believe that _independence_ is what _America_ aims at. It is an insidious
falshood. Madmen will be found in all large societies. It would be
singular, were there none such to be found in a body of three millions of
people and upwards. But they are like a grain of sand on the sea shore.”
Another person writes thus.—NEW-YORK, Nov. 2d. 1775. “We love and
honour our King. He has no subjects in all his dominions more attached
to his person, family and government, notwithstanding the epithet of
rebels bestowed upon us. No charge is more unjust than the charge that
we desire an independence on _Great Britain_. Ninety-nine in a hundred
of the inhabitants of this country deprecate this as the heaviest of
evils. But if administration will persist in their present measures,
this will and must inevitably be the event; for submit to the present
claims of the British parliament, while unrepresented in it, you may
be assured they never will. And what deserves notice is, that all the
violence of _Britain_ only unites the _Americans_ still more firmly
together, and renders them more determined to be free or die. This
spirit is unconquerable by violence; but they may be easily won by
kindness.—Serious people of all denominations among us, episcopal and
non-episcopal, are much employed in prayer to God for the success of the
present struggles of _America_. They consider their cause as the cause of
God; and as such, they humbly commit it to him, confident of success in
the end, whatever blood or treasure it may cost them.”
Since these letters were written, the sentiments of _America_, with
respect to _independence_, have been much altered. But it should be
remembered, that this alteration has been owing entirely to OURSELVES; I
mean, to the measures of the last winter and summer, and particularly the
following.
First. The rejection of the petition from the Congress brought over by
Governor PENN. In this petition they professed, in strong language, that
they still retained their loyalty to the King and attachment to this
country; and only prayed, “that they might be directed to some mode by
which the united applications of the Colonies might be improved into a
happy reconciliation; and that, in the mean time, some measures might be
taken for preventing their farther destruction, and for repealing such
statutes as more immediately distressed them.”—The Colonies had often
petitioned before without being heard. They had, therefore, little hope
from this application; and meant that, if rejected, it should be their
last.
Secondly. The last prohibitory bill, by which our protection of them was
withdrawn; their ships and effects confiscated; and open war declared
against them.
Thirdly. Employing _foreign_ troops to subdue them. This produced
a greater effect in _America_ than is commonly imagined. And it is
remarkable, that even the writers in _America_ who answered the pamphlet
entitled COMMON SENSE, acknowledge, that should the _British_ ministry
have recourse to foreign aid, it might become[95] proper to follow their
example, and to embrace the necessity of resolving upon _independence_.
I have, further, reason to believe, that the answer to the last petition
of the City of London, presented in March 1776,[96] had no small share in
producing the same effect.
By these measures, and others of the same kind, those Colonists who had
all along most dreaded and abhorred independence, were at last reconciled
to it.—I can, however, say from particular information, that even so
lately as the month of June last, an accommodation might have been
obtained with the Colonies, on a reasonable and moderate plan; without
giving up any one of the rights claimed by this country, except that
of altering their charters and disposing of their property.—And, as it
would have restored peace and prevented the desolating calamities into
which _America_ and _Britain_ are now plunged, no friend to humanity
can avoid regretting that such a plan, when offered, was not adopted.
But our rulers preferred coercion and conquest: And the consequence has
been, that the Colonies, after being goaded and irritated to the utmost,
resolved to disengage themselves, and directed the CONGRESS to declare
them Independent States; which was accordingly done, as is well-known, on
the 4th of July last. Since that time, they have, probably, been making
applications to foreign powers; and it is to be feared, that _now_ we
may in vain offer them the very terms for which they once sued.—All this
is the necessary consequence of the principles by which human nature
is governed.—There was a time when, perhaps, we should ourselves have
acted with more violence; and, instead of remonstrating and praying,
as _America_ has done, have refused the most advantageous terms when
offered with defiance, and under an awe from a military force. Had King
WILLIAM, instead of coming over by invitation to deliver us, invaded us;
and, at the head of an army, offered us the BILL OF RIGHTS; we should,
perhaps, have spurned at it; and considered LIBERTY itself as no better
than SLAVERY, when enjoyed as a boon from an insolent conqueror.—But we
have all along acted as if we thought the people of _America_ did not
possess the feelings and passions of _men_, much less of _Englishmen_.—It
is indeed strange our ministers did not long ago see, that they had
mistaken the proper method of treating the Colonies; and that though they
might be gradually _influenced_ to any thing, they could be dragooned to
nothing.—Had King _James the Second_ avoided violence; and been a little
more patient and secret in pursuing his views, he might have gained
all he wished for. But an eager haste and an open avowal of the odious
claims of prerogative ruined him.—This has been since considered; and
a plan both here and in _Ireland_,[97] less _expeditious_ indeed, but
more _sure_, has been pursued. And had the same plan been pursued in
_America_, the whole empire might in time have been brought, without a
struggle, to rest itself quietly in the lap of corruption and slavery.
It may, therefore, in the issue prove happy to the Colonies, that they
have not been thought worthy of any such cautious treatment. Our coercive
measures have done all for them that their warmest patriots could have
desired. They have united them among themselves, and bound them together
under one government. They have checked them in the career of vicious
luxury; guarded them against any farther infection from hence; taught
them to seek all their resources within themselves; instructed them in
the use of arms; and led them to form a naval and military power which
may, perhaps, in time, become superior to any force that can attack
them, and prove the means of preserving from invasion and violence, a
government of justice and virtue, to which the oppressed in every quarter
of the globe may fly, and find peace, protection, and liberty.—In short.
These measures have, in all probability, hastened that disruption of the
_new_ from the _old_ world, which will begin a new _æra_ in the annals
of mankind;[98] and produce a revolution more important, perhaps, than
any that has happened in human affairs.—As a friend, therefore, to the
general interest of mankind, I ought, probably, to rejoice in these
measures; and to bless that all-governing Providence, which, often, out
of the evil intended by wretched mortals, brings the greatest good.—But
when I consider the _present_ sufferings which these measures must
occasion, and the _catastrophe_ with which they threaten GREAT-BRITAIN;
I am shocked; and feel myself incapable of looking forward, without
distress, to the fate of an empire, once united and happy, but now torn
to pieces, and falling a sacrifice to despotic violence and blindness.
Under the impressions of these sentiments, and dreading the awful
_crisis_ before us, I cannot help, however impotent my voice, crying out
to this country—“Make no longer war against _yourselves_. Withdraw your
armies from your Colonies. Offer your power to them as a _protecting_,
not a _destroying_ power. Grant the security they desire to their
property and charters; and renounce those notions of dignity, which lead
you to prefer the exactions of force to the offerings of gratitude, and
to hazard _every thing_ to gain _nothing_.—By such wisdom and equity
_America_ may, perhaps, be still preserved; and that dreadful breach
healed, which your enemies are viewing with triumph, and all _Europe_
with astonishment.”
But what am I doing?—At the moment I am writing this, the possibility of
a reconciliation may be lost.—_America_ may have formed an alliance with
FRANCE—And the die may be cast.
SECT. III.
_Of Schemes for raising Money by Public Loans._
The following observations were occasioned by the scheme for the public
loan of last year, proposed to the _House of Commons_ at opening the
_Budget_, and afterwards agreed to. I have thought proper, therefore,
to introduce these observations here; and, as they appear to me of some
importance, I shall endeavour to explain them with as much care and
perspicuity as possible.
* * * * *
In order to raise _two millions_, the Legislature created last year a
new capital in the 3 _per cent._ consolidated annuities, of 2.150,000l.
Every share of 77l. 10s. in this new capital was valued at 65l.
17s. 6d. or every 100l. _stock_ at 85l. For the whole new capital,
therefore, Government has received in money, 1.827,500l.—The remaining
sum, necessary to make up _two millions_, was a compensation advanced
to Government for relinquishing the profits of a Lottery, consisting
of 60,000 tickets, each of the same value with 10l. _three per cent.
stock_; and might have been obtained, without annexing the Lottery to the
annuities.—This new capital the public may be obliged to redeem at _par_;
in which case, 322,500l. (being the difference between 1.827,500 and
2.150,000l.) that is 17½ _per cent._ will be paid by the public more than
it has received.—In this transaction, therefore, Government has acted as
a private person would act, who, in order to raise 850l. on a mortgage,
should promise for it 30l. _per ann._ (or 3½ _per cent._ interest) and
150l. (that is 17½ _per cent_. nearly) over and above the principal,
when the mortgage came to be discharged.—Such a _premium_ (should the
mortgage be discharged soon) would be very extravagant; but, if _never_
to be discharged, would be insignificant: Nor would it be possible to
account for such a bargain, except by supposing, that the borrower,
instead of meaning to repay the sum he borrowed, chose to continue
_always_ paying interest for it, or returning 30l. annually for 850l.
once advanced; and to subject his estate, for that purpose, to an eternal
incumbrance.
The public, I have said, may be obliged to discharge the new capital,
lately created, at _par_; and, consequently, to suffer a loss by this
year’s loan of 322,500l. This will, undoubtedly, happen, should the
nation prosper, and the public debts be put into a regular and fixed
course of redemption; for the 3 _per cents._ would then soon rise to
_par_.
The extravagance I have pointed out is the more to be regretted, because
it was entirely needless; for the same sum might as well have been
borrowed by schemes, which would not have subjected the public to the
necessity of paying, when the loan came to be discharged, more money than
had been received.—For instance. The sum advanced for the new capital of
2.150,000l. _three per cent._ annuities, might have been procured by
offering 3½ _per cent._ on a capital equal to the sum advanced; or on
1.827,500l. And the remainder, necessary to make up _two millions_, might
have been obtained by the profits of a Lottery, consisting of 60,000
tickets each worth 10l. in MONEY. This scheme would have differed but
little in value from the other; and the interest, or the annuity payable
by the public, would have been 63,962l. at 3½ _per cent._ on a capital
of 1.827,500l.;[99] instead of 64,500l. at 3 _per cent._ on a capital of
2.150,000l.
When a 100l. _stock_ in the 3 _per cent._ annuities is sold at 85¾,
purchasers get 3½ _per cent._ interest for their money. When, therefore,
the 3 _per cents_ are at this price, 3½ _per cents_ would be at _par_;
and a capital of 1.827,500l. might be redeemed by the public, (without
losing any advantage arising from its debts being at a discount,) by
paying this sum; or by returning the money borrowed[100]. But in the same
circumstances, a capital of 2.150,000l. in the 3 _per cent._ annuities,
for which 85l. _per cent._ or, in the whole, 1.827,500l. had been
received, could not be redeemed without offering 86 or 87 _per cent._
for it; nor, therefore, without paying _more_ than the original sum
borrowed.—When the 3 _per cents_ are near _par_, there would be a loss of
322,500l. in redeeming the same capital; whereas, the former annuities,
for which the same sum had been advanced, might be always discharged
by either paying the very sum[101] advanced, or a _less sum_.—In all
possible circumstances, therefore, these annuities would have the
advantage.—But we never, when contracting debts, carry our views to the
discharge of the principal; and the consequences must prove fatal.
* * * * *
It is necessary I should observe, in justice to our present ministers,
that in adapting the scheme on which I have made these remarks, they have
only followed the example of former ministers; and that, however needless
a waste it occasions of public money, there is reason to fear it will be
followed by future ministers; for the increase of difficulty and expence
in redeeming the public debts, which such schemes create, being to be
felt _hereafter_, it makes no impression, and is little regarded.
* * * * *
In 1759, the fifth year of the last war, the lenders of 6.600,000l. were
granted a capital in the 3 _per cents_ of 7.590,000l. together with the
profits of the Lottery. Subtract from the sum advanced, 150,000l. for
the profits of the Lottery; and it will appear, that, in this instance,
1.140,000l. was _needlessly_ added to the capital; there being no reason
to doubt, but that lenders would then have readily advanced 6.600,000l.
for a capital of 6.450,000l. bearing 3½ _per cent._[102] interest,
provided the profits of a Lottery were annexed; instead of advancing the
same sum for a nominal capital near 18 _per cent._ greater, but bearing 3
_per cent._ interest.
* * * * *
Again. In 1762, in order to raise 12 millions, every contributor of 80l.
was entitled to a capital of 100l. to bear 4 _per cent._ interest for
19 years; and afterwards to become redeemable, and to bear interest at
3 _per cent._ And for the remaining 20l. necessary to make up a 100l.
contributors were entitled to an annuity of 1l. for 98 years.—This was
the same with promising, for every 60l. advanced, a 100l. capital in
the 3 _per cent._ annuities, not redeemable for 19 years; and, for the
remaining 40l. necessary to make up 100l. an annuity of 2l. for 19 years;
and, after that, of 1l. for 79 years.
By this scheme no less a sum than 4.800,000l. was needlessly added to
the capital of the public debts. For, had 5 _per cent._ been offered for
every 60l. advanced;[103] and, for the remaining 40l. an annuity of 2l.
during 19 years, and afterwards of 1l. for 79 years; equal encouragement
would have been given to contributors; the annuity payable by the public
would have been the same; and the new capital would have been 7.200,000l.
bearing 5 _per cent._ interest; which might, at any time, have been
redeemed with a saving of a million _per ann._ (the first payment to be
made immediately) in _five_ years and a _quarter_: Whereas now, this debt
will not become redeemable till 1781; and then, it will form a capital
of 12 millions, not capable of being redeemed with the same saving, in
less than _nine_ years and a half. Five millions and a quarter,[104]
therefore, will be wasted.
The capital of 12 millions four _per cent._ annuities created this year,
were made irredeemable for 19 years, to guard against the effects of an
apprehension then unavoidable, that an interest of 4 _per cent._ would,
if the capitals were redeemable, be reduced, whenever peace came, to 3
_per cent._ as had been done in the preceding peace.—But this end would
have been answered, with equal effect and more advantage to the public,
by pledging the faith of Parliament, that whatever interest was promised
on any capital, should not be _reduced_ for 19 years; or (which comes to
the same) that the capital should not be _redeemed_, during that term,
by borrowing money, and creating a new capital bearing _lower_ interest.
This would have placed capitals bearing any interest on the same footing
_nearly_ with the 3 _per cent._ annuities; and an assurance, that no part
of them should be discharged, without at the same time discharging an
equal capital in the 3 _per cents_, would have placed them _entirely_ on
the same footing.—Had it, however, been necessary, on account of the fear
of a reduction of interest, to make the capital here proposed bearing 5
_per cent_, and the capitals to be mentioned presently bearing 4 _per
cent._ irredeemable, (and therefore the interest irreducible) for any
term (suppose till 1781); had, I say, even this been necessary (and more
could not have been necessary) no advantage of great consequence would
have been lost. These capitals would, during that term, have been exactly
the same burden on the public with the capitals which were actually
created; and after that term, they would have been a much less burden, as
will be shewn at the end of this section.
Again. In January 1760, eight millions were borrowed by offering for
this sum a capital of eight millions to carry 4 _per cent._ interest
for 21 years, and afterwards 3 _per cent_, together with a _premium_ of
240,000l. stock carrying the same interest, and divided into 80,000l.
lottery tickets, each 3l. stock.—This was the same with offering, for
80l. of every 100l. advanced, a capital of 100l. in the 3 _per cent._
annuities,[105] not redeemable for 21 years; and for the remainder
besides a lottery ticket an annuity of 1l. for 21 years.—The same sum
might have been raised by offering 4 _per cent_, irreducible during 21
years, or 3l. _per ann._ for 75l. of every 100l. advanced, and for the
remaining 25l. an annuity of 1l. for 21 years, together with a lottery
ticket.—In this case, the new capital, instead of 8.240,000l. bearing 3
_per cent._ not subject to redemption, and having an annuity of 82,400l.
annexed to it, for 21 years; would have been 6.000,000l. bearing 4 _per
cent._ with the same annuity annexed, but redeemable at _any_ time; and
240,000_l._[106] bearing 4 _per cent._ for 21 years, and afterwards 3
_per cent._
By the scheme likewise in 1761, for borrowing 11.400,000_l._ a capital
of 100_l._ bearing 3 _per cent. interest_, was given for part of every
100_l._ advanced; and for the other part, an annuity of 1_l._ 2_s._ 6_d._
for 99 years. Had, in this case, 75_l._ FOUR _per cent._ STOCK, been
offered for 75_l._ in _money_; and, for the remaining 25_l._ necessary to
make up 100_l._ the said annuity of 1_l._ 2_s._ 6_d._ for 99 years;[107]
the whole annual charge would have been the same; subscribers could not
have been sensible of any difference in the encouragement offered them;
and the public, in paying its debts, would have saved 2.850,000_l._
There was also this year 600,000_l._ received by government for
600,000_l._ stock, carrying 3 _per cent._ interest, and divided into
60,000 lottery tickets, each worth 10_l._ in stock.—As 150,000_l._ of
this sum was paid for the profits of the lottery; and as 4 _per cent._
could not at this time be made of money laid out in the funds, it is out
of doubt, that the same sum (or 600,000_l._) would have been given for
450,000_l._ stock, carrying 4 _per cent._ and divided into 60,000 lottery
tickets, each of the same value with 7_l._ 10_s._ four _per cent._ stock;
and thus 150,000_l._ more would have been saved.
In like manner; it will appear, that _three millions_, raised in
1757, by creating a capital of _three millions_ bearing 3 _per cent._
interest,[108] with a life annuity annexed of 1_l._ 2_s._ 6_d._ for every
100_l._ advanced; and also, _four millions and a half_ raised in 1758, by
creating a capital of _four millions and a half_, bearing 3 _per cent._
with an annuity of a _half per cent._ annexed for 24 years; might have
been raised by creating, in the former case, a capital of two millions
and a half, and, in the latter, a capital of four millions, bearing 3½
_per cent._ interest, with the same annuities annexed.
In 1758, the additional sum of half a million was borrowed at 3 _per
cent._ by a lottery, consisting of 50,000 tickets, each of the same
real value with 10l. _stock_, but sold to the subscribers for 10l. in
_money_[109]. As the 3 _per cents._ were now at 94, 3¼ _per cent._ could
not be made of money laid out in the funds. Therefore, 350,000_l._ of
this half million might have been raised at 3½ _per cent._ interest,
and the remaining 150,000_l._ might have been procured for the profits
of the lottery. Or (which is the same) 10_l._ each would have been given
for 50,000 tickets, of the same value taken all together, with 350,000l.
carrying 3½ _per cent._ interest; and a capital of 150,000_l._ would have
been saved.
The same is true of the lottery, by which half a million was borrowed
in 1756.—A million and a half also borrowed in this year, by creating a
capital of a million and a half, bearing 3½ _per cent._ for 15 years, and
afterwards 3 _per cent._ might have been procured, by creating a capital
of only 1.400,000_l._ bearing 3¼ _per cent._ interest. But I will not
examine any more of these loans. Let us next consider how detrimental
they have been to the public.
* * * * *
All the savings and surplus monies of the kingdom from 1763 to 1775, have
amounted (deducting 400,000_l._ gained by debts discharged at a discount)
to 10.739,793_l._ and with this sum 11.139,793_l._ of the national debt
has been paid off. (See the _Postscript_ at the end of this work.)—The
needless addition which was made to the capital of the national debt, by
injudicious schemes for raising money during the last war, exceeded this
sum; and it follows, therefore, that the whole surplus of the revenue for
twelve years, has not been sufficient to discharge the capital, to which
in the last war a right was given, without receiving any money for it, or
obtaining the least advantage by it.
The attentive reader must have observed, as I have gone along, that the
extravagance on which I have insisted, has been the consequence of not
separating, in the schemes for raising money, the premiums (consisting
of short and long and life-annuities) from the perpetual annuities, and
requiring them to be distinctly paid for; and also, of not attending to
the difference between selling an _annuity_, and selling the _stock_ for
which that annuity is paid. When a 100_l._ _stock_ in the 3 _per cents._
is at any given price, there is no one who would not be glad to purchase
from government a perpetual annuity of 3_l._ at any _lower_ price[110].
But when government sells the _stock_, instead of the _annuity_, at that
price, the public is injured in the manner I have represented.
Would any one, in selling any part of his property, offer to make the
purchase-money an outstanding principal which he shall be bound to
return?[111] This is what government has uniformly done in its proposals
for raising money.—Were I to desire any sum to be lent me _without_
interest, offering as a _compensation_ or _premium_ an annuity for a
given term, or an advantageous contract; the proposal would not be
accepted, unless the annuity or the contract was worth the sum to be
lent; and I should make myself a debtor to the purchaser for the very
thing which I sold to him.—The absurdity would be the same, if instead of
borrowing _without_ interest, I should in the same way borrow at a _low_
interest. In every such bargain, I should bring upon myself a needless
debt, equal to the value of the _premium_.
I am afraid I have tired my reader’s attention on this subject. But as
much depends upon a right understanding of it, I am anxious about shewing
it in every possible light. In hopes, therefore, of being attended to
a little longer, I shall endeavour to give a yet fuller view of this
subject, and to prove its importance, by recapitulating some of the
foregoing remarks, and comparing the _present_ state of our public debts,
with that which would have been their state, had the errors I have
pointed out, in the schemes of the public loans during the last war, been
avoided.
* * * * *
The sum of 12 millions, borrowed in 1762, would have left, at the end
of the war, a redeemable capital of 7.200,000l. carrying 5 _per cent._
interest, with an annuity added of 120,000l. for 18 years from January
1763, instead of an _ir_-redeemable capital of 12 millions carrying 4
_per cent._ for 18 years, and afterwards 3 _per cent._ See page 95, &c.
The sum of 12 millions, borrowed in 1761, would have left a redeemable
capital of 9 millions bearing 4 _per cent._ interest, with a long annuity
annexed; instead of 12 millions with the same annuity annexed. Page 100.
The sum of 8 millions, borrowed in 1760, would have left a redeemable
capital of 6.180,000l. carrying 4 _per cent._ with an annuity of 82,400l.
for 18 years from January 1763; instead of 8.240,000l. _ir_-redeemable,
and carrying 4 _per cent._ for 18 years, and afterwards 3 _per cent._
Page 99.
The sum of 6.600,000l. borrowed in 1759, would have left a capital of
6.450,000l. carrying 3½ _per cent_; instead of a capital of 7.590,000l.
carrying 3 _per cent._ Page 95.
The sum of five millions, borrowed in 1758, would have left a redeemable
capital of 4.350,000l. bearing 3½ _per cent._ interest, with an annuity
added of 22,500l. for 19 years from Midsummer 1763; instead of a capital
of five millions irredeemable, and carrying 3½ _per cent._ for 19 years,
and afterwards 3 _per cent._ Page 101, 102, &c.
The sum of three millions, borrowed in 1757, would have left a capital of
two millions and a half bearing 3½ _per cent._ interest, instead of three
millions bearing 3 _per cent._ interest.—And two millions, borrowed
in 1756, instead of leaving a capital of two millions, would have left a
capital of only 1.750,000l. Page 104.
The result, therefore, is, that the whole capital of the public debts
would have been, at the end of the last war, near TWELVE MILLIONS AND
A HALF less than it was; and at the same time, the annual charge not
greater.—In 1775, the difference would have been much more considerable.
For,
Supposing all the same sums applied since the last war to the discharge
of the public debts that we know have been so applied, not only the
_capital_ but the _annual charge_ would have been considerably less.—This
will be demonstrated by the following account.
It may be learnt from the _Postscript_ at the end of this Tract, that
11.139,793l. of the public debts has been discharged with 10.739,793l. of
the public money, derived from various savings and surplusses. All this
money _might_ have been employed, and without doubt _would_ have been
employed, in redeeming first the capital I have mentioned in Page 107,
of 7.200,000l. bearing 5 _per cent._ interest; and afterwards, the two
other capitals there mentioned of 9 millions, and of 6.180,000l. bearing
4 _per cent._ interest. It would have been sufficient to redeem the whole
of the former capital, and also 3.539,793l. of the two last capitals;
which would have set free for the public an annual charge of 501,591l.—To
this sum must be added an annual charge of 256,000l. saved in 1765, 1766,
1767 and 1768, by redeeming, with 6.400,000l. borrowed in those years, so
much of a debt unfunded at the end of the war, but afterwards funded, and
carrying 4 _per cent._ interest. And also 12,537l. _per ann._ gained by
changing 1.253,700l. from an interest of 4 to 3 _per cent._ and 7,500l.
_per ann._ gained in 1771, by the ceasing of an annuity of a ½ _per
cent._ annexed for 15 years to 1.500,000l. borrowed in 1756.—The total
decrease, therefore, of the annual charge would have been 777,628l.—But
at the same time there would have been the following additions to
it.—First. There would have been the addition of 199,500l. _per ann._
being the interest of 6.650,000l. borrowed since 1763.—Secondly. Of
69,187l. _per ann._ being the interest of 2.306,240l. applied, in 1764
and 1765, to the discharge of German and army debts derived from the
war, and which might have been converted into a funded capital bearing
3 _per cent._ interest, by borrowing money to pay them off, in order to
avoid diverting money employed in redeeming capitals bearing 5 _per cent._
These two sums make 268,687l. which deducted from 777,628l. leaves
508,941l. And this is the clear annual charge which would have been
saved to the public, exclusive of the savings which have arisen from the
falling in of life-annuities.
But the annual charge that has in fact been saved is only
382,129[112].—The difference is 126,812l.—With this additional saving,
as it fell in and increased from time to time during the course of 12
years, a million more of the public debts bearing 4 _per cent._ might
have been redeemed; and this would have made a farther saving of 40,000l.
_per ann._ It appears, therefore, upon the whole, that had the mistakes I
have pointed out, in the loans of the last war, been avoided, (all other
public measures remaining the same) the nation would _now_ have had 13
millions and a half less to pay, in order to redeem its debts; and also
an annual charge upon it 166,812l. less.
All this supposes that the capitals of the 5 _per cent._ and 4 _per
cent._ annuities in the improved schemes were redeemable.—But had they
been made irredeemable till 1781, as mentioned in page 98, the public
would not have been much less benefited: For, soon after 1781, these 5
and 4 _per cents._ (the former 7.200,000l. and the latter 15.180,000l.)
might have been easily reduced to 3½ _per cent._ and this would have
occasioned an annual saving of 183,900l. over and above the savings,
which would have arisen in that year, from the extinction of the short
annuities.
I will add, that had these annuities been made not only _irredeemable_
till 1781; but _irreducible_ for some time beyond that year, in the
manner intimated in page 98, the public would still have been greatly
benefited. For, the annual charge upon it would not at any time have been
greater; but its debts would have been 12 millions and a half less; and,
at the same time, they would have been capable of being discharged with
more expedition, and at a less expence, than a smaller quantity of its
present debts. See the note, page 94.
* * * * *
I cannot doubt but that all who will attentively examine these
observations will find them to be just.—I have confined my enquiries
to the loans of the last war. Had I extended them to all our loans, it
would have appeared, that a greater sum than most persons can think
credible,[113] has been such a needless addition to our debts as I have
explained; or, “a pure and uncompensated loss, which might have been
avoided by only framing differently the schemes of the public loans.”