SECT. I.
ABSTRACT of the EXPORTS from and IMPORTS to GREAT-BRITAIN from 1697 to
1773, with REMARKS.
IMPORTS. EXPORTS. EXCESS of EXPORTS.
£. £. £.
ANNUAL MEDIUM
for FOUR YEARS
ended at 1700 4.956,975 6.034,724 1.077,749 or 10/56 of
the exports.
For FIVE YEARS
ended at 1710 5.321,717 6.713,246 1.391,529 or 10/48 of
the exports.
at 1715 5.304,343 7.401,946 2.097,603 or 10/35 of
the exports.
at 1725 6.628,279 9.663,527 3.035,248 or 10/32 of
the exports.
at 1735 7.470,454 11.855,226 4.384,772 or 10/27 of
the exports.
at 1745 7.363,079 11.922,982 4.559,903 or 10/26 of
the exports.
at 1750 7.429,739 12.877,129 5.447,390 or 10/24 of
the exports.
at 1755 8.264,834 13.406,530 5.141,696 or 10/26 of
the exports.
at 1760 8.877,144 14.253,377 5.376,233 or 10/26 of
the exports.
For FOUR YEARS
ended at 1764 10.110,870 15.793,158 5.682,228 or 10/28 of
the exports.
For NINE YEARS
ended at 1773 11.996,769 14.814,074 2.817,305 or 10/53 of
the exports.
This ABSTRACT has been formed from the accounts delivered annually to the
HOUSE OF COMMONS, and lately published by Sir CHARLES WHITWORTH.
In order to draw just inferences from it, the following particulars
should be remembered.—First. The EXPORTS in the _Custom-House_ entries
are, for reasons well-known, too high. This excess has, by some of
the best judges, been reckoned at a million _per ann._—Secondly. The
IMPORTS are too low, no smuggled commodities being included in them.
This deficiency has been estimated at another million _per ann._ But, in
order to be sure of keeping within bounds, I will take both at a _million
and a half per ann._—Thirdly. The interest of the national debt paid to
foreigners; the money spent in foreign countries by _English_ travellers;
the bullion consumed in manufactures; and the wear of the current coin,
cannot, perhaps, amount to much less than two millions _per ann._ I will,
however, take them at no more than the annual sum which has been commonly
supposed to be due to foreigners from our funds; or, a _million and a
half_.—In order, therefore, to find the GRAND BALANCE OF PAYMENT between
_Britain_ and the rest of the world _since_ the last war, all these
sums (making up THREE MILLIONS) must be deducted from the excess of the
exports.—But, in order to find the same balance _before_ the end of the
last war, less must be deducted, in proportion as the national debt and
the foreign trade were _then_ less than they are _now_.
If the foregoing Abstract is examined with a due regard to this rule, it
will be found that, from[114] 1710 to 1764, the BALANCE OF PAYMENT must
have been in favour of _Britain_; and that consequently, there must have
been, during that period, an influx of money into the kingdom.—It was
this, together with the increase of our paper, that produced the rapid
fall of interest which began a few years before the _Accession_. And it
was this also that enabled us to bear the great expence of the two last
wars, and the loss of those enormous sums which were sent out of the
kingdom to pay foreign subsidies, and to support armies on the continent.
Before 1710 it appears to be doubtful, whether the excess of the
exports was such as brought any money into the kingdom; but it seems
certain, that it could not have been such as in any degree compensated
that drain of the public cash, which was occasioned by the continental
wars of King _William_ and Queen _Ann_. In consequence of this, the
quantity of _specie_ in the kingdom must have been greatly diminished;
and Dr. _Davenant_ computes that in 1711 it was nine millions less than
at the _Revolution_. Hence proceeded the high rate of interest; the
unproductiveness of the taxes; and the difficulties which government
met with in raising money during those two wars: And there is reason to
believe, these difficulties would have been insurmountable, had not a
substitute for _specie_ been provided by the establishment of the _Bank_.
In the interval of peace between the two last wars, or from 1748 to
1755, the balance in favour of _Britain_ was at the highest; and this
contributed to raise the stocks[115] to such a price, as enabled
government to reduce the interest of the public debts from 4 to 3 _per
cent._
But the observation I here intended principally to make is, that the
_balance_, since the year 1764, appears, from the preceding abstract, to
have been _against_ BRITAIN; and that this accounts for the high price of
bullion, the scarcity of specie, and the distress of the _Bank_ from that
year to 1773.
It deserves farther to be observed that, while the exports were
decreasing from 1764 to 1773, the IMPORTS appear to have increased
faster than ever: And the fact is, that since 1760, a greater addition
has been made to them, than had been made during the whole time from the
_Accession_ to that year.—This is a striking proof that luxury has been
for some years increasing with rapidity among us; and it is worth adding,
that the productiveness of the taxes has kept pace, as might have been
expected, with this increase of luxury, both the CUSTOMS and EXCISES
having brought in lately, near 250,000l. _per ann._ each, more than they
did twelve years ago.—It should be attended to, that this improvement
of the revenue must be the effect solely of an increased consumption
occasioned by luxury; the taxes, ever since the end of the last war,
having been nearly the same.
The _exports_ from 1710 to 1764 went on increasing constantly. I have
observed, that from 1764 to 1773 they have decreased. One reason of this
has been, the decline of the PORTUGAL trade; the exports to that country
having fallen, since 1760, from 1.200,000l. _per ann._ to 600,000l. _per
ann._—Another reason has been the check which a wretched policy has been
giving, ever since 1763, to our trade with the Colonies. This trade had
for many years contributed more than any other trade towards raising our
_exports_; and even in the period between 1763 and 1774, notwithstanding
the checks it received, it went on increasing, and produced a balance
in our favour of a million and a half _per ann._ But since 1774 it has
been entirely lost. _Before_ this loss, the balance of payment between
us and the rest of the world was, according to the account I have given,
_against_ us. Undoubtedly then, it was a loss we could by no means have
sustained, had it not been for the seasonable interposition of some very
particular causes. Time will shew whether these causes are of a permanent
nature, or temporary and accidental.
SECT. II.
_HISTORICAL DEDUCTION and ANALYSIS of the PUBLIC DEBTS._
_STATE and AMOUNT of the NATIONAL DEBT, at Midsummer, 1775, with the
Charges of Management._
CAPITALS and ANNUITIES transferable at the BANK OF ENGLAND.
Principal. Interest.
£. £.
CAPITAL of their original Fund—See Note (1) p. 125 3.200,000 96,000
EXCHEQUER bills, by 3d of _Geo._ I. c. 8th, bearing
originally 5 _per cent._ interest, but reduced
to 4 _per cent._ in 1727, and to 3 _per cent._ by
23d _George_ II. 1749. See Note (2) p. 126 500,000 15,000
Purchased of the SOUTH SEA COMPANY in 1722,—reduced
from 6 to 5 _per cent._ interest in 1717; from 5
to 4. _per cent._ in 1727; and to 3 _per cent._
by 23d of _George_ II. 1749.—See Note (3) 4.000,000 120,000
Lent to government at 4 _per cent._ in 1728,
charged on the surplus of the fund for the
lottery in 1714, and reduced to 3 _per cent._
by 23d _George_ II. 1749 1.250,000 37,500
Lent at 4 _per cent._ in 1727; charged on the
duties on coals; and reduced to 3 _per cent._
by 23d of _George_ II. 1749 1.750,000 52,500
Lent at 4 _per cent._ in 1746; charged on licences
for retailing spirituous liquors; and reduced to
3 _per cent._ by 23d _Geo._ II. 1749 986,800 29,604
---------------------
Amount of Bank capital 11.686,800 350,604
See Note (4) p. 126.
Charge of management 5,898_l._ _per ann._
BANK ANNUITIES.
Consolidated 4 _per cent._ annuities due
_April_ 5, and _October_ 10—See Note (5) 18.986,300 759,452
These annuities fall to 3 _per cent._ in
_January_, 1781. Charge of management
10,680_l._ _per ann._
Annuities at 3½ _per cent._ 1758, due _Jan._ 5, and
_July_ 5.—These annuities fall to 3 _per cent._
in 1782 4.500,000 157,500
See an account of them in p. 101.
Charge of management 2,805_l._ _per ann._
including management on half a million raised
at the same time by a lottery, and made a part
of the consolidated 3 _per cents_.
CONSOLIDATED 3 _per cent._ annuities due _Jan._ 5,
and _July_ 5. See Note(6) 38.251,696 1.147,551
Management 21,087_l._ _per ann._
REDUCED 3 _per cent._ annuities, due _April_ 5,
and _Oct._ 10. See Note (7) 18.353,774 550,613
Charge of management 10,324_l._ _per ann._
Three _per cent._ 1726, due _Jan._ 5, and _July_ 5,
charged on the deduction of 6_d._ _per_ pound on
all pensions from the civil list; and on all
payments from the crown, except to the navy and
army—See Note (8) p. 128 1.000,000 30,000
Management 360_l._ _per ann._
Long annuity due _Jan._ 5, and _July_ 5 6.702,750 248,250
The remaining term from _Jan._ 1776, is 84
years—See Note (9) p. 128.
Management 3,491_l._ _per ann._
CAPITALS and ANNUITIES transferable at the SOUTH SEA HOUSE.
SOUTH SEA STOCK 3.662,784 109,884
The dividend on this stock, at 3½ _per cent._
is 128,197_l._ 9_s._—Due _Jan._ 5, and _July_ 5.
SOUTH SEA 3 _per cent._ OLD Annuities due
_April_ 5, and _Oct._ 10 11.907,470 357,224
Three _per cent._ NEW Annuities due _Jan._ 5,
and _July_ 5 8.494,830 254,845
Three _per cent._ 1751, due _Jan._ 5, and
_July_ 5 1.919,600 57,588
Charge of management on _South Sea_ Stock and
Annuities 15,100_l._ _per ann._—See Note (10).
CAPITAL and ANNUITIES transferable at the INDIA HOUSE.
EAST INDIA STOCK 3.200,000 96,000
Interest 3 _per cent._
_Dividend_ 7 _per cent._ 224,000_l._ due _Jan._
5, and _July_ 5.—See Note (11).
Charge of management 1.285_l._ 14_s._ 4_d._
EAST INDIA Annuity due _April_ 5, and _Oct._ 10,
charged on the surplus of a tax on spirituous
liquors. See Note (12) 1.000,000 30,000
Management 401_l._ 15_s._ 8_d._ _per ann._
ANNUITIES payable at the EXCHEQUER.
ANNUITIES for 96 and 99 years, from various
dates, in the time of King _William_
and Queen _Anne_—See Note (13) 1.836,276 131,203
Salaries to Exchequer officers, and
management—5,250_l._ _per ann._
Annuities for lives, with benefit of survivorship,
granted by the 4th of _William_ and _Mary_,
1693.—These annuities are not yet extinct,
and they are valued at three years purchase 22,781 7,567
Annuities for lives, with benefit of survivorship,
by an Act of the 5th of _Geo._ III. 1765—See
Note (14) 18,000 540
Annuities for two or three lives, granted in
1694.—Also, Annuities on single lives 1745, 1746,
and 1757.—See Note (15)—Their original amount,
taken all together, was very nearly 124,000_l._
but they are now reduced by deaths to near
80,000_l._ and their value is here taken at
10 years purchase 800,000 80,000
UNFUNDED DEBT, consisting of Exchequer bills,
(1.250,000_l._) Navy debt, (1.850,000_l._)
and Civil list debt, supposed 500,000_l._—The
interest is reckoned at 2 _per cent._—See
Note (16) 3.600,000 72,000
Salaries to Exchequer bill officers 650_l._
_per ann._
---------------------
Total of the principal and interest of the
National Debt at _Midsummer_ 1775. £. 135.943,051 4.440,821
_NOTES containing an EXPLANATION and HISTORY of the different Articles in
the foregoing Account._
NOTE (1)—BANK OLD CAPITAL. See Page 119.—The BANK was established in
1694. Their original capital was 1.200,000_l._ bearing 8 _per cent._
interest, charged on 5/7ths. of 9_d._ _per_ barrel excise, with 4000_l._
_per ann._ for management.—In 1709, they lent to government 400,000_l._
without interest, which increased their old capital to 1.600,000_l._
bearing 6 _per cent._ interest. In 1742, they again lent to government
1.600,000l. without interest; and thereby increased this capital to its
present amount, or to 3.200,000_l._ bearing 3 _per cent._ with the same
annual sum for management.—It is of particular importance to observe with
respect to the sums of 400,000_l._ and of 1.600,000_l._ just mentioned,
that they were properly a compensation from the _Bank_ to the public for
continuing their exclusive privileges; and would have been advanced,
or at least the greatest part of them, though government had not bound
itself to return the purchase money, by making it a part of the principal
due to the _Bank_, provided the same interest had been continued for
some time on their former principal, and the same liberty granted to
increase their _stock_.—The like is true of 1.200,000_l._ advanced by the
_India_ Company without interest in 1708.—In these instances, therefore,
a needless addition was made to the public debt of 3.200,000_l._ which,
had it been avoided, the public would have had not only a principal so
much less to pay; but it would have saved in interest at least 96000_l._
_per ann._ for the old capital of the _Bank_ and the capital of the _East
India_ Company would have formed, in this case, between them, a debt of
only 3.200,000_l._ (instead of 6.400,000_l._) the interest of which might
long ago have been reduced at least one half; or from 8 _per cent._ the
original interest, to 4 _per cent._
* * * * *
NOTE (2)—_Half a million_, part of the BANK CAPITAL. See Page 119.—This
part of the Bank capital consisted originally of two millions in
_Exchequer_ bills, cancelled for government by an act of the 3d of _Geo._
I. But half a million was discharged in 1729; and a million in 1738.
* * * * *
NOTE (3)—FOUR MILLIONS purchased of the SOUTH-SEA COMPANY; part of the
BANK Capital. See Page 119.—In order to procure this money, the _Bank_
sold new stock at 18 _per cent._ premium. This produced a saving of
610,169_l._ the sale of 3.389,831_l._ _stock_ having produced four
millions in _money_. And, consequently, though by this transaction the
capital for which they received interest was increased four millions,
yet the _stock_ on which they made their dividends was increased only
3.389,831_l._
* * * * *
NOTE (4)—BANK STOCK and DIVIDEND.—The _stock_ on which the _Bank_ divides
is only 10,780,000_l._ This dividend varies as their profits vary; but
for several years it has been 5½ _per cent._ payable half-yearly at
_Lady-day_ and _Michaelmas_. Their whole annual dividend is, therefore,
592,900_l._ which subtracted from 350,604_l._ the interest paid by
government, makes their clear annual profit 242,296_l._—Besides interest,
they receive for management of their capital 4000_l._ _per ann._ on
account of their old capital, and 1,898_l._ _per ann._ on account of
four millions purchased of the South Sea Company; in all, 5,898_l._ _per
ann._—The _Bank_ receives farther the sums specified in the foregoing
account, towards bearing the expences of managing the annuities commonly
called _Bank Annuities_. All these expences, including the sums granted
for managing their capital, amount to 54,645_l._ _per ann._
* * * * *
NOTE (5)—CONSOLIDATED 4 _per cent._ BANK ANNUITIES. See Page 120.—The
capital of these Annuities consists of two loans, one in 1760, and
the other in 1762, consolidated into one stock, and charged on the
additional duty of 3_d._ per bushel on malt, the surplus of the duties
on spirituous liquors, and the additional duties on windows; all which
duties were ordered by 2d Geo. III. to be carried to the Sinking Fund,
and the interest with which they were charged to be paid out of that
fund.—I have made some remarks on these loans in page 96, and page 99.
They amounted to 20.240,000_l._ But 1.253,700_l._ of this capital was
changed in 1770, from an interest of 4 to 3 _per cent._ and the capital
reduced to the present sum.—A more full account of these annuities may be
found in Mr. _Ashmore_’s Analysis of the several Bank Annuities, p. 17.
* * * * *
NOTE (6)—CONSOLIDATED 3 _per cent._ BANK ANNUITIES. See page 121.—The
capital of these annuities is made a distinct stock from that of the
annuities called _Reduced_, because it never bore a higher interest than
3 _per cent._—It consisted originally of the following loans—37,821_l._
remaining in 1727, of 3 _per cent._ annuities, granted in lieu of
St. _Christopher_’s and _Nevis_ debentures—800,000_l._ borrowed in
1731—600,000_l._ borrowed in 1736—300,000_l_. in 1738—6.400,000_l_.
in 1742, 1743, 1744 and 1745, and charged on additional duties on
spirituous liquors, wines, vinegar, &c.—1.000,000_l._ borrowed in
1750—24.490,000_l._ borrowed in the course of the last war, and funded on
the additional duties on beer, houses, stamps, &c.—4.900,000_l._ borrowed
in 1766, 1767 and 1768—And 1.253,700_l._ of the 4 _per cent._ annuities,
subscribed into the 3 _per cent._ annuities in 1770.
All these loans were by 25 Geo. II. 1751, and several subsequent Acts
of Parliament, consolidated into one joint stock; and carried, with the
duties for paying the interest, to the _Sinking Fund_. And in 1770, they
formed a capital of 39.781,521_l._ which has been since reduced, by the
payments mentioned in the _Postscript_ at the end of this tract, to the
sum specified in the account to which this note refers.—See a more full
account in Mr. Ashmore’s Analysis, &c. from page 5 to page 11.
* * * * *
NOTE (7)—REDUCED 3 _per cent._ BANK ANNUITIES. See page 121.—The capital
of these annuities consisted, in 1749, of loans in 1746, 1747, and 1748,
and navy, ordnance and transport debts funded in 1749, amounting to
18.402,472_l._ and all bearing 4 _per cent._ interest.—By the 23d of
Geo. II. 1749, these loans were reduced to an interest of 3 _per cent._
and by the great consolidating Act in 1751, they were converted into one
stock, and carried into the Sinking Fund with the duties on carriages,
and the additional duties on glass, spirituous liquors, houses, windows,
stamps, merchandize imported, &c. which had been granted for paying the
interest.—In 1751, certain exchequer tallies and orders, amounting to
129,750_l._ were subscribed into this stock; and in 1765, navy bills to
the amount of 1,482,000_l._ were subscribed into it, which made its whole
original amount 20.014.222_l._—In 1751, there was paid off 830,898_l._
being stock which had not been subscribed agreeably to the Act in 1749
for reducing interest; and in 1772, 1774, and 1775, so much more of this
stock was paid off as reduced it to its present amount.—See Mr. Ashmore’s
Analysis, p. 12-16.
* * * * *
NOTE (8)—CIVIL LIST MILLION. See page 121.—The income settled upon King
George I. for his civil list, was 700,000_l._—In 1720, there had been
granted him besides, from the _Royal Exchange_ and _London_ Assurance
companies, 300,000_l._ And in 1726, this million was farther granted
towards paying off his debts.
* * * * *
NOTE (9)—BANK LONG ANNUITY. See page 122.—This annuity consists of
128,250_l._ _per ann._ for 99 years, given in 1761, as a _premium_ to the
subscribers of 11.400,000_l._ at 3 _per cent_; and of 120,000_l._ _per
ann._ for 98 years, given in 1762, as a premium to the lenders of twelve
millions at 4 _per cent._ See page 95 and 100. It is charged, together
with the loans to which it was annexed, on the _Sinking Fund_.—Its value
in the Alley is about 25 years purchase; but the remaining term is really
worth 27 years purchase, reckoning interest at 3½, (or the 3 _per cents._
being at 85¾.) But when interest is at 4 _per cent._ or the 3 _per
cents._ are at 75, it is worth only 24 years purchase.—When this annuity
is called a _premium_, it must not be imagined, that no compensation was
given for it. Government received the value of it; but, at the same time,
made itself a debtor for that value. And, what is very surprizing, this
has been uniformly practised with respect to all the premiums or douceurs
granted by government; and the consequence has been, that great and
needless increase of the public debt explained in the 3d section of the
2d Part.
* * * * *
NOTE (10).—SOUTH-SEA STOCK AND ANNUITIES. See page 122.—These four
capitals amounting to 25.984,684_l._ 13_s._ consist almost entirely
of the remainder of debts contracted in the reigns of _King William_
and Queen _Anne_. The following account will probably give sufficient
information concerning them.
In 1711, Lord Oxford being minister, the proprietors of certain navy,
army, ordnance and transport debts, to the amount of 9.177,968_l._
including arrears of interest, and half a million for the current
supplies, were incorporated into a company for trading to the
_South-seas_. They were allowed 6 _per cent._ interest for this debt,
with 8000_l._ _per ann._ for management; and the duties on wine, tobacco,
_East-India_ goods, candles, &c. were made perpetual, and granted as a
_Fund_ (ever since called the _South-sea Company’s Fund_) for paying the
interest. This kept up public credit at the time, and has been called
the _Earl of Oxford_’s master-piece.—By the 1st of Geo. I. 822,032_l._
consisting chiefly of interest payable on the Company’s capital, was
added to the capital, in consequence of which it was increased to TEN
MILLIONS, (ever since called their _original capital_) bearing 6 _per
cent._ interest.—In 1717, they agreed to take 5 _per cent_; and this was
the first great reduction of interest, which in conjunction with the same
reduction of the other redeemable debts almost all carrying 6 _per cent._
laid the foundation of the SINKING FUND established in this year. But
it is remarkable, that so fast did interest fall at this time, that the
price of _South-sea stock_, notwithstanding this reduction, rose from 101
to 111.—In 1719, the _South-sea_ capital was increased to 11.746,844_l._
bearing 5 _per cent._ interest (with an addition of 1,397_l._ 9_s._
to their former allowance for management) by advancing to government
544,142_l._ and by the proprietors of 94,329_l._ 12_s._ lottery annuities
for 32 years granted in 1710, accepting in lieu of them 1.202,702_l._
_South Sea stock_.—In 1720, the agreement was made by government with
the South Sea Company, which produced the great SOUTH SEA BUBBLE.—There
existed at that time _long_ annuities to the amount of 666,821_l._
8_s._ and _short_ annuities, for 32 years from 1710, to the amount of
127,260_l._ 6_s._ The proprietors of these annuities were allowed to
subscribe them into the _South Sea_ trading stock; and the Company, for
every 100_l._ of the _long_ annuity which should be subscribed, were
to receive from government an addition to their capital of 2000_l._
bearing 5 _per cent._ interest till 1727, and afterwards 4 _per cent._
till redeemed: and for every 100_l._ of the _short_ annuities, they
were to receive an addition to their capital of 1400_l._ bearing the
same interest.—They were besides to take in the redeemable debts to the
amount of 16.546,482_l_. and to receive an addition to their capital of
100_l._ for every 100_l._ subscribed.—By the subscription of the _long_
and _short_ annuities which followed this agreement, a capital due from
government to the Company was created, which was greater by 3.034,769_l._
than the original sum advanced for the annuities subscribed. And as
much of these annuities and of the redeemable debts were subscribed, as
increased the _South Sea_ trading capital to 37.802,203_l._—In 1722,
four millions of this capital was purchased by the BANK, (See Note 3.)
which reduced it to 33.802,203_l._—By 9 Geo. I. 1723, this remaining
capital was divided into two equal parts, one of which alone (or
16.901,101_l._) was ordered to be the trading capital of the Company,
and the other part was directed to be called _South Sea Annuities_.—In
1733, the _South Sea_ trading capital had been reduced by payments at
different times to 14.651,137_l._ 12_s._ By an Act of Parliament in
that year, this remaining stock received a farther division; and only
a fourth part, or 3.662,784_l._ was allowed to be the Company’s stock;
and the other three parts, or 10.988,353_l._ were directed to be called
NEW South Sea Annuities, in order to distinguish them from the former
annuities, which have ever since gone under the name of OLD South Sea
annuities.—From 1733, to the present time, SOUTH SEA STOCK has continued
the same; but the capital of the OLD South Sea annuities has been
reduced, by redemptions, to 11,907,470_l._ and of the NEW South Sea
annuities, to 8.494,830_l._ And of the whole _South Sea_ debt, which in
1722 was 33.802,203_l._ there has, since that year, been paid off in all
9.737,119_l._ This should have reduced it to 24.065,081_l._ but it is in
reality 25.984,685_l._ The reason of this is, that the diminution just
mentioned of the _South Sea_ debt was made in part with money borrowed in
1751, to pay off such proprietors of South Sea annuities as had refused
to consent to the reduction of interest proposed to them in 1749. The sum
borrowed for this purpose was 2.100,000_l._ bearing 3 _per cent._ with
1181_l._ 5_s._ for management. This debt is now reduced by redemptions to
the sum specified in the preceding account; or to 1.919,600_l._
* * * * *
NOTE (11).—EAST-INDIA STOCK. See page 123.—In 1698, a company of
merchants, in consideration of two millions lent to government at 8 _per
cent._ were incorporated, and entitled to the sole privilege of trading
to the _East-Indies_.—These two millions formed the first capital of the
present _East-India_ Company.—In 1702, an old company of traders to the
_East-Indies_ was united to this company; and in 1708, these united
companies lent to government 1.200,000_l._ without additional interest,
which made their capital 3.200,000_l._ bearing 5 _per cent._—In 1730,
this interest was reduced to 4 _per cent._ and by the 23d Geo. II. 1749,
to 3 _per cent._—The salt duties, and some additional stamp duties, were
at first charged with the annuity due on this capital; but at present the
duties constituting the aggregate fund are charged with it.
* * * * *
NOTE (12).—EAST-INDIA ANNUITY. See page 123.—The capital of this
annuity was advanced to government in 1744, at 3 _per cent._ and, in
consideration of this loan, the exclusive charter of the Company was
continued to Lady-day 1783, at which time it is to cease, provided three
years notice has been given, and the debt due from government discharged.
An observation here forces itself upon me, which I have often had
occasion to make.—Part of this loan was a compensation from the
_East-India_ Company for prolonging the term of its charter; and,
therefore, ought not to have been included in the loan. The Company would
have lent 750,000_l._ on the interest common at the time, or 4 _per
cent._ and the remainder would have been advanced as a gratuity.—It is a
pity those who managed these contracts for the public, did not attend to
the absurdity and extravagance of making a _debt_ of purchase money, and
_borrowing_ in the very act of _selling_.
* * * * *
NOTE (13).—EXCHEQUER LONG ANNUITIES. See page 123.—These are the _long_
annuities which, in 1720, remained unsubscribed to the South Sea Company.
See Note 10.—They consist first of annuities to the amount of 54,900_l._
14_s._ 6_d._ purchased by the 4th, 5th, and 6th of _William_ and _Mary_,
for 96 years, from January 1695, with the addition of 1350_l._ _per ann._
for salaries to exchequer officers. These annuities were originally 14
_per cent._ life-annuities. By the 6th and 7th of _William_ and _Mary_,
in order to raise more money, these annuitants, or any other persons
for them, were offered a reversionary interest in the annuities after
the failure of the lives, till the end of 96 years from January 1695,
on paying 4½ years purchase, (that is 63_l._) for every annuity of
14_l._—The predecessors of the present company of the MILLION BANK (so
called from the MILLION lottery 1694, in which they were some of the
principal adventurers) purchased 30,669_l._ 4_s._ of these reversionary
annuities. The life annuitants being now reduced to a very small number,
almost the whole of this annuity is lapsed to the _company_; and though
they have divided for several years 5 _per cent._ on a capital of half a
million, yet their growing savings, from the falling in of lives, have
been such, that, when their annuity ceases in 1791, they will, I am
informed, have accumulated a fund considerably larger, than the capital
on which they have made their dividends. But to return.
* * * * *
These EXCHEQUER Annuities consist farther of
£. _s._ _d._
30,400 6 8 purchased for 99 years from _Christmas_
1705, by 2d and 3d of _Anne_, with
1450_l._ for management.
23,234 16 6 purchased for 99 years from _Lady-day_,
1706, by 4 _Anne_, with 1470_l._
_per ann._ for management.
7,776 10 0 purchased for 99 years from _Lady-day_,
1707, by 5 _Anne_, with 375_l._ 12_s._
_per ann._ for management.
4,710 0 0 purchased for 99 years from _Lady-day_,
1708, by 6th of _Anne_, with 208_l._
2_s._ _per ann._ for management.
10,181 0 0 purchased for 99 years from _Lady-day_,
1707, by a 2d Act of 5th of _Anne_,
with 416_l._ _per ann._ for management.
Add 54,900 14 6
-----------------
131,203 7 8 Total.
The original sum contributed for these annuities was 1.836,276_l._ They
are even now worth more than this sum. The public has already paid above
TEN MILLIONS; and by the time they are all extinct, it will have paid
above THIRTEEN MILLIONS, on their account. This is great extravagance;
but it is nothing to the extravagance constantly practised of borrowing
on perpetual annuities, without putting them into a fixed course of
redemption.
* * * * *
NOTE (14).—TONTINE by an act of 6 Geo. III. See page 124.—The intention
of this Act was to raise 300,000_l._ towards paying off navy bills, by
offering to subscribers for every 100_l._ advanced, an annuity of 3_l._
for their lives, with benefit of survivorship. But the scheme did not
succeed, and only 18000_l._ was subscribed.
* * * * *
NOTE (15).—LIFE ANNUITIES. See page 124.—The annuities on _two_ lives in
1694, were sold at 12_l._ _per ann._ during _two_ lives, of any ages, and
the annuities on _three_ lives, at 10_l._ _per ann._ during three lives,
for every 100_l._ advanced.—This was very extravagant; for, supposing the
annuitants in general, about the age of 20 or 30, it was the same, in
the case of _two_ lives, with giving above 10 _per cent._ for money, and
in the case of _three_ lives, 9 _per cent._—It is, likewise, extremely
absurd in these cases to pay no regard to difference of ages. A _single_
life at the age of 60, supposing money improved at 4 _per cent._ is
intitled to 11 _per cent._ but at the age of 10, scarcely to 6 _per
cent._ _Two_ lives at 60, are entitled, on the same supposition, to 8½
_per cent._ but at 10, not to 5 _per cent._—The original amount of these
annuities was 22,700_l._ nearly. In 1762, that is, in 68 years, they were
reduced by deaths no lower than 9,215_l._
The other life-annuities mentioned in the preceding account were
_douceurs_ granted for loans in 1745, 1746, and 1757. An account of the
annuities granted in the last of these years may be seen in page 101.
The life-annuities in 1745, amounted to 22,500_l._ and were granted,
together with the profits of a lottery, for a loan of two millions at 4
_per cent._
The life-annuities in 1746, amounted to 45,000_l._ and were granted,
with the profits of another lottery, for a loan of three millions, at
the same interest.—The remarks made in the 3d section of the last part,
and particularly in the note, p. 101, are applicable to these two loans.
The value of the life-annuities, and the profits of the lotteries, were
made a part of the public debt. And, supposing the life-annuities worth,
one with another, only 14 years purchase, and the profits of the two
lotteries worth 300,000_l._ it will follow, that the capital created
by these loans, instead of being 5.000,000_l._ should have been only
3.755,000_l._
But there is another remark, which it is proper to mention here. The
life-annuities granted in 1757, amounting to 33,750_l._ were, in January
1775, that is in 18 years, reduced by deaths to 28,732_l._ or but a
little more than a seventh part. But, supposing the annuitants all in
the firmest stage of life, or between the age of 10 and 30, they ought,
according to some of the best tables of observations, to have been
reduced a _quarter_. These life-annuities have, therefore, fallen in much
more slowly than could have been expected; and I have found the same to
be true of all the other life-annuities.—The reason, undoubtedly, is,
that the tables exhibit the rate of mortality among all sorts and orders
of men taken together; whereas, the lives on which annuities are bought,
are a selection of the better sort of lives from the general mass, and
therefore must be of greater value.—Indeed I am not acquainted with any
table of observations which gives the probabilities of the duration
of life high enough to be a guide in this case; except that which was
formed by Mr. _De Parcieux_, from the French _Tontines_.—A calculation,
therefore, of the values of lives, agreeably to this table, would be of
considerable use.
* * * * *
NOTE (16).—UNFUNDED DEBT. See page 124.—I have given the navy debt, as it
was in January, 1775.—The civil list debt in 1775, was probably more than
the sum at which I have reckoned it. Lord STAIR, in his account of the
national debt, income, and expenditure, reckons it at 800,000_l._
Much the greatest part of the foregoing debts, with the taxes for
paying the interest, including the duties composing the _Aggregate_,
_South-Sea_, and _General_ Funds, have, by the 25th of _George_ the
Second, 1751, and several subsequent acts of Parliament, been thrown
into one general account; and the _surplus_ of the whole, after
deducting the interest, 800,000l. _per ann._ to the civil list, and a
few other payments, forms the SINKING FUND.—The debts not brought to
this account are about seven millions and a half in the _South-Sea_
House; 11.186,800l. of the _Bank_ capital; the Civil List million; four
millions and a half borrowed at 3½ _per cent._ in 1758; the capital of
the East-India annuity; and the Exchequer long and life annuities, except
those granted in 1758. But the _surplusses_ of the duties which pay
the interest of these debts are either carried _immediately_ into the
_Sinking Fund_ account; or brought _first_ to the _Aggregate_ Fund, and
from thence carried into that account.—On the contrary. Deficiencies in
these duties when they happen, are made good out of the Sinking Fund; and
afterwards replaced from the supplies.
For example. Three old nine-penny excises on beer, with an additional
three-pence per barrel, producing above half a million annually; also,
3,700l. _per_ week out of the hereditary excise on beer, together with
some duties on paper, coals, &c. and ⅓ additional subsidy of tonnage and
poundage, are appropriated to the payment of the Banker’s Annuity; the
Life Annuities granted in 1693 and 1694; the Exchequer Long Annuities;
and annuities on various sums subscribed to the South-Sea Company in
1720. The surplusses make a part of the _Aggregate Fund_; and after
contributing to satisfy the charge on that fund, are carried into the
_Sinking Fund_.—Again. Certain additional duties on soap, parchment,
coals, &c. are appropriated to pay the interest of 1.250,000l. and
of 1.750,000l. parts of the Bank capital.—The surplusses are carried
_directly_ to the _Sinking Fund_.—In like manner. The duties on houses
and windows imposed by an act of the 20th of _George_ the Second,
1747,[116] after deducting from them 91,485l. _per ann._ to satisfy
certain charges on old house-duties in the _Aggregate Fund_; and, also,
other duties on houses and windows imposed by the 2d and 6th of _George_
the Third, amounting in all to about 205,000l. _per ann._ are carried
into the Sinking Fund, together with the capitals, the interest of which
has been charged upon them. But the addition to these duties (with a
tax on pensions) granted in 1758, and charged with the interest (at 3½
_per cent._) of the loan in that year, having not been carried into the
_Sinking Fund_, and proving deficient; the deficiency is constantly made
good out of this fund, and afterwards replaced from the supplies.
_State and Amount of the NATIONAL DEBT at Christmas 1753; with the
Charges of Management._
BANK OF ENGLAND.
Principal. Interest.
£. £.
BANK capital 11.686,800 393,038
Of this capital 3.200,000l. bore at this time 3
_per cent._ interest; and the remainder bore 3½
_per cent._ till 1757, by 23d Geo. II. 1749.—See
note (1) p. 125.
Management 5,898l. _per ann._
Three _per cent._ BANK Annuities consolidated by
25 Geo. II. 1751.—See note (6) p. 127. 9.137,821 274,135
Management 4,450l. _per ann._
BANK Annuities consolidated by 25 Geo. II.
2.713,618l. carrying 3½ _per cent._ interest
till 1755; and 14.857,956l. carrying the same
interest till 1757. See note (7) p. 128. 17.740,132 619,546
Management 9,884l. _per ann._
Civil List million, 1726 1.000,000 30,000
Management 360l. _per ann._
Whole charge of Management at the Bank in
1753—20,592l. _per ann._
SOUTH-SEA COMPANY.
SOUTH-SEA STOCK carrying 4 _per cent._ till 1757 3.662,784 146,511
Old and New SOUTH-SEA Annuities carrying 3½
_per cent._ till 1757 21.362,525 747,688
Three _per cent._ 1751—See note (10) p. 131. 2.100,000 63,000
Whole charge of management at the _South-Sea-House_
on stock and annuities, 15,748l. _per ann._
EAST-INDIA HOUSE.
EAST-INDIA STOCK, reduced to 3½ till 1757 3.200,000 112,000
EAST-INDIA annuity 1744 1.000,000 30,000
Management 1,687l. 10s. _per ann._
---------------------
Total[117] £. 70,851,254 2.415,918
EXCHEQUER.
ANNUITIES for 96 and 99 years from various dates
in King _William_’s and Queen _Anne_’s times
being the original sum contributed. See note
(13) page 132. 1.836,276 131,203
Management 5,230l. _per ann._ inclusive of
management for the two next articles.
ANNUITIES for lives with benefit of survivorship,
being the original sum contributed 108,100 7,567
ANNUITIES for two and three lives, being the
remainder after deducting the annuities fallen
in by deaths, and reckoned worth 10 years
purchase 106,650 10,665
ANNUITIES for single lives 1745, being the
remainder after deducting the annuities fallen
in by deaths; and reckoned worth 14 years
purchase 296,142 21,153
ANNUITIES for single lives 1746, being the
remainder after the lives fallen in 582,274 41,591
Navy debt in 1754—Interest reckoned at 2
_per cent._ 1.296,568 25,931
---------------------
Total of the principal and interest of the
public debts in 1753 £. 75.077,264 2.654,028
_STATE and AMOUNT of the NATIONAL DEBT in 1739._
BANK OF ENGLAND.
Principal. Interest.
£. £.
BANK CAPITAL, consisting of 1.600,000l. old capital
carrying 6 _per cent_; and 7.500,000l. carrying 4
_per cent._ See note 1, p. 123. 9.100,000 396,000
BANK ANNUITIES at 3 _per cent._ for the lottery in
1731. 800,000 24,000
SOUTH-SEA COMPANY.
Stock and annuities bearing 4 _per cent._ 27.302,203 1.092,088
EAST-INDIA COMPANY.
EAST-INDIA stock carrying 4 _per cent._ 3.200,000 128,000
EXCHEQUER ANNUITIES.
Annuities at 3½ by 4 Geo. II. paid off in 1752 400,000 14,000
ANNUITIES at 4 _per cent._ charged on the duty on
wrought plate by 6 Geo. I. 1720 312,000 12,480
182,250l. of this capital was paid off in 1750.
The remainder is now included in the capital
of the reduced 3 _per cent._ annuities.
ANNUITIES at 3 _per cent._ charged on the Sinking
Fund by 9 and 10 Geo. II. Now included in the
consolidated 3 _per cent._ annuities 900,000 27,000
ANNUITIES on _Nevis_ and St. _Christopher_ Debentures
at 3 _per cent._ Now included in the consolidated
3 _per cents._ 37,821 1,135
EXCHEQUER BILLS charged on a duty upon victuallers
by 12 Geo. I. 1726—Carrying 3 _per cent._ 480,000 14,400
EXCHEQUER BILLS charged on a duty on sweets by 10 of
Geo. II. 1737—Carrying 3 _per cent._ and paid off
in 1754—See the note p. 140. 499,600 14,988
ANNUITIES for long terms from various dates 1.836,276 131,203
ANNUITIES for lives with _benefit_ of _Survivorship_
granted in 1693 108,100 7,567
ANNUITIES for two and three lives, 1694 106,650 15,000
_Navy_ debt[118] 1.300,000 26,000
---------------------
Total of the _Principal_ and _Interest_ of the
National Debt in 1739[119] £. 46.382,650 1.903,861
From the account in the POSTSCRIPT, at the end of this tract, it will
appear, that 10.639,793l. of the public debt was discharged between
the years 1763 and 1775; and also that the _funded_ debt was, in
1775, 1.400,000l. greater than it was at the end of the last war.
From hence, and from the amount of the public debt in 1775, as stated
in page 124, it follows, that the funded debt at the end of the war
was 130.943,051l. and the whole debt 146.582,844l. and, consequently,
that the war left upon the nation an _unfunded debt_ amounting to[120]
15.639,793l. This unfunded debt consisted of the following particulars—Of
3.500,000l. borrowed after the peace in 1763, and applied towards
bearing such expences of the war as could not immediately cease with its
operations.—Of near _eight millions_ in navy, victualling, ordnance, and
transport debts.—Of 1.800,000l. _Exchequer bills_; and the remainder,
of subsidies to foreign princes, extraordinaries of the army, and German
demands.
In the interval of peace between 1748 and 1755 the following debts were
paid off.
£.
_Bank Annuities_ bearing 4 _per cent._ 1.013,148
SOUTH-SEA Annuities bearing 4 _per cent._ 176,893
_Annuities_ bearing 3½ _per cent._ charged by 4 Geo. II. on
additional Stamp-duties 400,000
EXCHEQUER Bills bearing 3 _per cent._ charged by 10 Geo. II.
1737 on the duties on sweets 499,600
Borrowed in 1745 at 3½ _per cent._ on the credit of the Salt
duties 1.000,000
See note, page 140.
-----------
[121]Total £. 3.089,641
From the whole, the following account of the progress of the National
Debt, from 1739 to 1775, may be deduced.
Principal. Interest.
£. £.
_Amount_ of the _principal_ and _interest_
of the national debt before the war
which begun in 1740 46.382,650 1.903,861
Amount in 1749 immediately after the war 78.166,906 2.765,608
Increased by the war 31.784,256 861,747
Diminished by the Peace from 1748 to 1755 3.089,641 111,590
Amount at the commencement of the last war 75.077,264 2.654,018
Amount at the end of the war in 1763 146.582,844 4.840,821
Increased by the last war 71.505,580 2.186,803
Diminished by the Peace, in twelve years from
1763 to 1775 10.639,793 [122]400,000
Amount at _Midsummer_, 1775 135.943,051 4.440,821
We are now involved in another war, and the public debts are increasing
again fast. _Exchequer_ Bills have been increased from 1.250,000l. to
1.500,000l. A new capital of 2.150,000l. has been added to the 3 _per
cent._ Consolidated Annuities. And a vote of credit was given in the
last session of Parliament for a million. The last year, therefore, has
added 3.400,000l. to our debts, besides a vast sum not yet provided for,
consisting of navy, ordnance, victualling, transport and army debts.—The
present year (1777) must make another great addition to them; and what
they will be at the end of these troubles, no one can tell.—The union of
a _foreign_ war to the present _civil_ war might perhaps raise them to
TWO HUNDRED MILLIONS; but, more probably, it would sink them to—NOTHING.
SECT. III.
_Of the DEBTS and RESOURCES of France._
Ministers have of late sought to remove the public apprehensions by
general accounts of the weakness of powers, which, from the circumstances
of former wars as well as national prejudices, have been felt by the
people as jealous rivals or formidable enemies.—I wish it was possible
for me to confirm these accounts; and by contrasting the preceding state
of our own debts with a similar one of those of FRANCE, to shew, that
from this power in particular we have nothing to fear. The following
particulars, on the correctness of which I can rely, may give some
assistance in judging of this subject.
* * * * *
The whole expence of the last war to FRANCE was 1.118.307,047 livres;
that is, 49.702,000l. sterling: of which 23.152,000l. (520.926,000
livres) consisted of money procured by the sale of taxes, by free-gifts,
and extra-impositions during the war, which left behind them no debts:
And 26.550,000l. (597.380,100 livres) consisted of LOANS, or money raised
on perpetual annuities, life-annuities, and lotteries.—At the beginning
of 1769 the whole amount of the debts of _France_, including all arrears
and capitals advanced on annuities and lotteries, was 128.622,000l.
sterling, or 2.894.053,616 livres. The annual charge derived from this
debt was 6.707,500l. sterling (150.919,284 livres)—All the appropriations
amounted to 8.218,500l. sterling (184.919,284 livres).—The expences of
the army, navy, king’s houshold, prince’s houshold, foreign affairs, &c.
amounted to 8.947,000l. or 201.307,312 livres. So that the whole annual
expence was 17.165,000l. (386.226,596 livres).—The whole revenue had
amounted, before 1769, to 13.484,500l. sterling (303.401,696 livres).—The
public expence, therefore, had exceeded the revenue 3.681,000l.
(82.800,000 livres.) _per ann._
From the year 1769 to the present King’s Accession, by forced reductions
of interest, and by new taxes, the public revenue was carried to
16.289,000l. sterling (366.508,000 livres) and the public expence was
reduced so as not to exceed the revenue above 766,800l. _per annum_
(17.253,000 livres).—The anticipations also of the revenue, which
before 1769 had extended to _seventeen_ months, were reduced to _five_
months.—Such was the progress of reformation; namely, an increase of
revenue amounting to little less than THREE MILLIONS sterling _per ann._
in a few years, under an unpopular minister, in the latter days of a
reign never characterized by an attention to oeconomy, or a regard to the
public interest; and at this time particularly stamped by unprecedented
profusion and a general relaxation.
A new reign produced a new minister of finance whose name will be
respected by posterity for a set of measures as new to the _political_
world, as any late discoveries in the system of nature have been to the
_philosophical_ world.—Doubtful in their operation, as all unproved
measures must be, but distinguished by their tendency to lay a solid
foundation for endless peace, industry, and a general enjoyment of
the gifts of nature, arts, and commerce.—The edicts issued during his
administration exhibit indeed a phænomenon of the most extraordinary
kind. An absolute king rendering a voluntary account to his subjects,
and inciting his people to _think_; a right which it has been the
business of all absolute princes and their ministers to extinguish in
the minds of men.—In these edicts the king declared in the most distinct
terms against a bankruptcy, an augmentation of taxes, and new loans;
while the minister applied himself to increase every public resource by
principles more liberal than _France_, or any part of _Europe_, ever had
in serious contemplation.—It is much to be regretted, that the opposition
he met with, and the intrigues of a court, should have deprived the world
of those lights which must have resulted from the example of such an
administration.
After a short interval, a nomination, in some respects still more
extraordinary, has taken place in the court of FRANCE. A court which a
few years since was distinguished by its bigotry and intolerance, has
raised a _Protestant_, the subject of a small but virtuous republic, to
a decisive lead in the regulation of its finances. It is to be presumed,
that so singular a preference will produce an equally singular exertion
of integrity and talents. Though differing from Monsieur TURGOT in
several principles, which regard the larger lines of government, he
appears by his first steps, and, particularly, the preamble to a late
edict for raising 24 millions of livres by a lottery, to put his foot
on the same great basis of general justice, and a strict conservation
of the faith o£ the king; and points more particularly at the surest
of all resources in any modern states, a simplification of taxes and
a reformation in the collection of them. This administration, making
improvements in the Revenue its immediate object, is more capable of
present exertion; and, as such, is more formidable.
From these facts and observations it is impossible not to conclude,
that if we trust our safety to the difficulties of FRANCE, we may
find ourselves fatally deceived. I will add, that though (like the
3s. land-tax and lotteries among ourselves) some of the extraordinary
impositions of the last war have been continued in _France_, there
are some which ceased with the war, and which they can renew. It is,
particularly, an advantage of unspeakable importance to them, that they
can carry on a war, as they did the last, at _half_ our expence; and
that, having no dependence on the flattering delusion of paper, they
can, as they did in 1759, bear even a bankruptcy in the middle of a
war, and yet carry it on vigorously.—Their debts time itself is sinking
fast. Of 3.111,000l. (seventy millions of livres) in annuities on the
_Hotel de Ville_ at _Paris_, 1.777,000l. (forty millions of livres)
consisted in 1774 of Life Annuities, which were falling by deaths at
the rate of 71,000l. (1.600,000 livres) every year.—Even their loss of
credit, whatever present embarrassment attends it, favours them upon
the whole. To this they owe the advantages just mentioned. The facility
with which our high credit has enabled us to run in debt ensnares us;
and, if a change of measures does not take place,[123] must _ruin_ us.
Experience has given them a just horror at borrowing on permanent funds;
and were they inclined to do it, they are not able to do it to any great
amount; and, consequently, they cannot go on mortgaging one resource
after another till none is left.—While we lose sight of the capital in
the interest, they carry their views chiefly to the reimbursement of
the capital; and after receiving high interest, for some years, can be
satisfied with receiving back a part of their capital.—Their debts, being
confined in a great measure to the _Farmers General_ and others at PARIS,
are not circulated and diffused among the body of the people in the
manner ours are: And it is well known, that they can make use of methods
to discharge them which our government must never think of. The acts of
arbitrary power and unjust expedients to which, on many occasions, they
have had recourse for this purpose without producing any tumults, are
such as appear to us almost incredible; and should the time ever come,
when it will be necessary in this country to make use of any violence of
the same kind, all government will probably be at an end.
In point of territory and number of inhabitants, the two countries will
bear no comparison[124]. We have hitherto opposed _France_ by our free
spirit, and our colonies; and to them chiefly we owe our prosperity and
victories. Our colonies once separated from us, the islands will soon
follow. But should they remain ours, our comparative advantages will best
appear from the following authentic account of the imports into _France_
from their islands.
In 1774.
Weight in Pounds.
Sugar imported into _France_ 147.986,959
Indigo 1.734,206
Rocou 210,187
Coffee 58.247,133
-----------
208.178,485
In 1775.
Weight in Pounds.
Sugar imported into _France_ 171.932,972
Indigo 2.134,247
Rocou 169,831
Coffee 58.545,000
-----------
[125]232.782,050
Value of the above commodities re-exported from _France_, taken upon the
average price.
_Livres._ _Sterling._
In 1774 75.901,373 3.373,000
In 1775 74.961,318 3.331,000
The whole importation from the _West Indies_ into _Britain_ is about
three millions _per ann._
But I have gone much beyond the views with which I begun this section.
The facts which have been stated, and the reflections which they have
occasioned, are intended principally to shew that we ought not to suffer
ourselves to be drawn into security by any assurances of the weakness
of _France_.—May she, however, find herself the weakest of kingdoms
whenever, from motives of interest or ambition, she shall attempt to
injure any of her neighbours.—May _Britain_, hitherto the most favoured
spot under heaven, always preserve her distinguished happiness, and
escape the danger which now threatens her. And may the time soon come,
when all mankind, sensible of the value of the blessings of peace and
equal liberty, shall suffer one another to enjoy them, and learn war no
more.
SECT. IV.
_Containing an Account of the National Income and Expenditure; the
Surplus of the Revenue; and the Money drawn from the Public by the Taxes;
with Remarks on Lord STAIR’S Account._
_APPROPRIATED REVENUE at Midsummer, 1775._
£.
Interest of the national debt 4.440,821
Civil list revenue. See the note in page 163 800,000
Expences of management attending the national debt; of which
71,432 l. is the expence of management at the Bank, South-Sea
House, and _India_ House; and 5.900 l. salaries to _Exchequer
Officers_. See Page 119, &c. 77,332
Annuities payable out of the Aggregate Fund to the DUKE OF
GLOUCESTER, 8000 l.—DUKE OF CUMBERLAND, 8000 l.—the
Representatives of ARTHUR ONSLOW, Esq; 3000 l.—And the
Sheriffs of ENGLAND and WALES, 4000 l.—In all 23,000
Clerk of the Hanaper in Chancery—Coinage[126] expence—Tenths
and first-fruits of the Clergy appropriated to the
augmentation of small livings—Extra revenues of the
crown, consisting of _American_ quit-rents; duty of 4½
_per cent._ in the Leeward Islands; revenues of Gibraltar
and dutchy of _Cornwall_, &c.—Fees for warrants and orders,
for auditing and engrossing accounts of dividend warrants,
and other charges at the EXCHEQUER and TREASURY[127] 100,000
---------
Total of the Appropriated Revenue £. 5.441,153
_State of the SURPLUS of the REVENUE for 11 years ended at 1775._
UNAPPROPRIATED REVENUE.
NEAT PRODUCE of the Sinking Fund, for five years, including
casual surplusses, reckoning to _Christmas_ in every year;
being the annual medium, after deducting from it about
45,000l. always carried to it from the supplies, in order
to replace so much taken from it every year to make good
a deficiency in a Fund established in 1758. £. 2.610,759
Neat annual produce of Land Tax at 3s. militia deducted;
and of the Malt Tax[128] 1.800,000
(N. B. These two taxes in 1773, brought in only 1.665,475l.)
There are some casual Receipts, not included in the Sinking
Fund, such as Savings in Pay-Office, duties on Gum Senega,
American Revenue, &c. But they are so uncertain and
inconsiderable, that it is scarcely proper to give them as
a part of the permanent Revenue. Add however on this account 50,000
---------
Total of unappropriated Revenue £. 4.460,759
_Produce of the SINKING FUND, reckoned to Christmas in every Year._
1770 £. 2.486,836
1771 2.553,505
1772 2.683,831
1773 2.823,150
1774 2.731,476
The average of these five years is 2.655,759l. or, deducting 45,000l. (as
directed in the last page), 2.610,759l.
In 1775, the Sinking Fund was taken for 2.900,000l. including an
extraordinary charge of 100,000l. on the _Aggregate_ Fund; but it
produced 2.917,869l. The average of six years, including 1775, was
2.654,443l. The average of five years before 1770, was 2.234,780l.
ANNUAL EXPENDITURE.
£.
Peace Establishment, for the Navy and Army, including
all miscellaneous and incidental expences 3.700,000
Annual increase of the Navy and Civil List debts 350,000
Interest at 2 _per cent._ of 3.600,000l. unfunded debt,
which must be paid out of the unappropriated Revenue 72,000
---------
Total 4.122,000
ANNUAL SURPLUS of the Revenue 338,759
---------
Annual income £. 4.460,759
The estimate for the peace establishment, including miscellaneous
expences, amounted, in 1775, to 3.703,476l.—But the extraordinary
expences, occasioned by the war with America, made it fall very
short.—In 1774 it amounted to 3.784,452l. exclusive of 250,000l. raised
by Exchequer Bills, towards defraying the expence of calling in the
gold coin. And the medium for eleven years, from 1765, has been nearly
3.700,000l.—According to the accounts which I have collected, the expence
of the peace establishment (including miscellaneous expences) was in
1765, 1766, and 1767, 3.540,000l. _per ann._—In 1768, 1769, and 1770,
it was 3.354,000l. _per ann._—In 1771, 1772, 1773, 1774, and 1775, the
average has been nearly four millions _per ann._ exclusive of the expence
of calling in the coin.
* * * * *
The parliament votes for the sea service 4l. _per_ month _per_ man,
including wages, wear and tear, victuals and ordnance. This allowance
is insufficient, and falls short every year more or less, in proportion
to the number of men voted. From hence, in a great measure, arises that
annual increase of the navy debt, mentioned in the second article of the
_National Expenditure_. This increase in 1772 and 1773 was 669,996l. or
335,000l. _per ann._ The number of men voted in those two years, was
20,000. I have supposed them reduced to 16,000, and the annual increase
of the Navy Debt to be only 250,000l.—Add 100,000l. for the annual
increase of the Civil List Debt, and the total will be 350,000l.
* * * * *
Soon after the publication of the preceding account in _February_ last
year, the EARL OF STAIR obliged the public with another account of
the same kind, which brings out a conclusion much more unfavourable.
According to this account, were lotteries abolished, and the land-tax
at 3s. in the pound only, there would be a _deficiency_ in the revenue,
instead of such a _surplus_ as I have stated. The following remarks will
shew the reason of this difference.
The EARL OF STAIR has taken the annual produce of the _Sinking_ Fund
at 2.506,400l. being the average produce of EIGHT years ended at _Lady
day_ 1775.—I have taken it at 2.610,759l. being the average of FIVE
years ended at _Christmas_ 1775.—The neat produce of the land and malt
taxes has been also taken near 50,000l. higher in my account; and I have
besides admitted 50,000l. _per ann._ for casual supplies, which his
Lordship has not charged.
The annual increase of the Navy Debt, LORD STAIR states at 300,000l. and
of the Civil List at 200,000l. I have stated the former at 250,000l. and
the latter at 100,000l.—In order also to avoid, as much as possible, all
exaggeration, I have thrown out the expence of the new coinage. Lord
Stair has admitted it, and given an yearly expence derived from hence of
100,000l.—He has also taken the Peace Establishment for 1774, as a fair
medium for common years of peace, because it was lower in that year than
in the three years preceding 1775. I have taken the average of _eleven_
years of peace, which is 75,000l. less.
In consequence of these differences, the national PEACE expenditure in
_Lord Stair_’s account comes out 325,000l. _per ann. higher_ than in
mine; and the national income comes out 204,359l. _lower_; from whence it
follows, that without lotteries, and the land being at 3s. in the pound,
the kingdom must, according to his Lordship’s calculation, run out at the
rate of about 200,000l. every year.
In some of the particulars I have mentioned, this account is probably
nearest to the truth; but, I hope, it will be considered, that I have
studied to give moderate accounts, and aimed at erring always rather on
the favourable than the unfavourable side.
_Second Method of deducing the SURPLUS of the REVENUE._
From the year 1763 to the year 1775, or during a period of 12 years,
10.639,793l. of the public[129] debt was paid off.—The money employed
for this purpose must have been derived from the surplus of the
_ordinary_ revenue, added to the _extraordinary_ receipts. These receipts
have consisted of the following articles.—1st. The land-tax at 4s. in the
pound in 1764, 1765, 1766, and 1771; or 1s. in the pound extraordinary
for four years, making 1.750,000l.—2. The profits of ten lotteries[130]
making (at 150,000l. each lottery) 1.500,000l.—3. A contribution of
400,000l. _per ann._ for five years from the EAST INDIA Company, making
2.000,000l.—4. Savings by debts discharged at a discount,[131] making
at least 400,000l.—5. Paid by the Bank in 1764 for the renewal of their
charter, 110,000l.—6. Savings on high grants during the war; produce of
_French_ prizes taken before the declaration of war; sale of lands in the
ceded islands; and composition for maintaining _French_ prisoners,[132]
making 2.520,000l.—All these sums amount to 8.280,000l. There remains to
make up 10.639,793l. (the whole debt discharged) 2.359,793l. and this,
therefore, is the amount of the whole surplus of the _ordinary_ revenue
for twelve years; or 196,000l. _per ann._[133]
The Earl of STAIR has also, in this method, calculated the _surplus_ of
the Revenue; and makes the total, for eleven years, to be no more than
2.557,378l. even with the assistance of lotteries, and the land-tax at
4s. in the pound for five years; from whence it follows, that _without_
these assistances, there would have been a deficiency of near 60,000l.
_per ann._—The reason is, that his Lordship has taken the whole debt paid
since 1763, at no more than 7.053,855l. or three millions and a half
less than I have made it; and he has taken it so much less, chiefly in
consequence of including in the amount of the public debt in 1775, the
excess of the expences of that year above the common peace expences.
This excess is to be charged to the present war; and, in determining the
ordinary peace _surplus_, which is my object, it was proper to exclude
it, and to terminate the account at the commencement of the war.—I will
only add, that Lord STAIR has also included more in the extraordinary
receipts than I have; and, particularly, 700,000l. which he supposes the
public gained by the TEA INDEMNITY.—But this was only a compensation made
by the _East-India_ Company for the loss which the public sustained by
taking off, in 1766, a part (or 1s. _per_ pound) of the duty on tea. In
1772 it was restored; and the excise upon tea has since, if I am rightly
informed, produced as much as ever. _Before_ 1766, it produced annually
474,091l. Immediately[134] after 1766, it produced 341,284l.—But in 1775,
it produced near half a million.
_Sketch of an Account of the Money drawn from the Public by the Taxes,
before the Year 1776._
£.
CUSTOMS in ENGLAND, being the medium of the payments
into the Exchequer, for 3 years ending in 1773[135] 2.528,275
Amount of the EXCISES in ENGLAND, including the malt tax,
being the medium of 3 years ending in 1773 4.649,892
Land Tax at 3s. 1.300,000
Land Tax at 1s. in the pound 450,000
SALT DUTIES, being the medium of the years 1765 and 1766 218,739
Duties on Stamps, Cards, Dice, Advertisements, Bonds, Leases,
Indentures, News-papers, Almanacks, &c. 280,788
Duties on houses and windows, being the medium of 3 years
ending in 1771 385,369
Post Office, Seizures, Wine Licences, Hackney Coaches, Tenths
of the Clergy, &c. 250,000
EXCISES in SCOTLAND, being the medium of 3 years ending in 1773 95,229
CUSTOMS in SCOTLAND, being the medium of 3 years ending in 1773 68,369
Annual profit from Lotteries 150,000
Inland taxes in SCOTLAND, coinage duties, casual revenues, such
as the duties on Gum-Senega, American revenue, &c. 150,000
EXPENCE of collecting the EXCISES in ENGLAND, being the average
of the years 1767 and 1768, when their produce was 4.531,075l.
_per ann._—6 _per cent._ of the gross produce 297,887
EXPENCE of collecting the Excises in SCOTLAND, being the medium
of the years 1772 and 1773, and the difference between the
gross and nett produce—31 _per cent._ of the gross produce 43,254
EXPENCE of collecting the CUSTOMS in ENGLAND, being the average
of 1771 and 1772, bounties included, and 15 _per cent._ of
the gross produce, exclusive of drawbacks and over-entries 468,703
N. B. The bounties for 1771 were 202,840l.—for 1772, 172,468l.
The charges of management for 1771, were 276,434l.
For 1772, 285,764l. or 10 _per cent._ nearly.
Interest of loans on the land tax at 4s. expences of collection,
militia, &c. 250,000
PERQUISITES, &c. to Custom-house officers, &c. supposed 250,000
EXPENCE of collecting the Salt-duties in ENGLAND, 10½ _per cent._ 27,000
Bounties on fish exported 18,000
EXPENCE of collecting the duties on Stamps, Cards, Advertisements,
&c. 5¼ _per cent._ 18,000
----------
Total £. 11.900,505
----------
It must be seen, that this account is imperfect and defective. It is,
however, sufficient to prove, that the whole money raised DIRECTLY by the
taxes, (exclusive of tithes, county rates, and the taxes which support
the poor,) cannot be much less than TWELVE MILLIONS. The _Earl of Stair_
has in his papers made it to be above 400,000l. more, by including in
his estimate several articles which I have omitted; particularly, the
interest and management on the equivalent to _Scotland_, the Scotch crown
Revenues, Dutchy of _Cornwall_ and _Lancaster_ Fines, &c. He has also
given an estimate of the fees and perquisites of office of every kind,
and reckoned them at half a million; whereas, I have only reckoned the
perquisites of office at the _Custom-house_.
I should be inexcusable were I to quit this subject, without taking
notice of the particular gratitude due from the public to _Lord Stair_,
for publishing his papers; and for stepping forth at this time to draw
attention, by the weight of his name and character, to calculations,
which, as he justly says, “it becomes every man of property among us to
understand; to awaken the nation from the lethargy into which the mockery
of paper wealth has plunged it; and to bear his testimony against the
present unnatural war.”
POSTSCRIPT.
The following POSTSCRIPT has been published only in a few of the last
Editions of the _Observations on Civil Liberty._ It has been often
referred to in the preceding work; and, therefore, it is necessary to
give it a place here.
_ACCOUNT of Public Debts discharged, Money borrowed, and Annual Interest
saved from 1763 to 1775._
Debts paid off since 1763. Annuity decreased.
£. £. _s._
1765 870,888 funded, bearing interest at
4 _per cent._ 34,835 10
1.500,000 unfunded, 4 _per cent._ 60,000 00
1766 0.870,888 funded, 4 _per cent._ 34,835 10
1.200,000 unfunded, 4 — 48,000 00
1767 2.616,777 funded, 4 — 104,671 0
1768 2.625,000 funded, 4 — 105,000 0
1771 1.500,000 funded, 3 _per cent._ 45,000 0
1772 1.500,000 funded, 3 _per cent._ 45,000 0
1773 800,000 unfunded, 3 — 24,000 0
1774 1.000,000 funded, 3 — 30,000 0
1775 1.000,000 funded, 3 — 30,000 0
---------- ----------
Total 15.483,553 Total 561,342 0
In 1764, there was paid off 650,000_l._ navy-debt; but this I have not
charged, because scarcely equal to that annual increase of the navy-debt
for 1764, 1765, and 1766, which forms a part of the ordinary peace
establishment. The same is true of 300,000_l._ navy-debt, paid in 1767;
of 400,000_l._ paid in 1769; of 100,200_l._ paid in 1770; 200,000_l._ in
1771; 215,883_l._ in 1772; and 200,000_l._ in 1774.
_Account of money borrowed and debts contracted since 1763._
Annual interest
£ increased.
Borrowed and funded,
at 3 _per cent._ in 1765 1.500,000 45,000
in 1766 1.500,000 45,000
in 1767 1.500,000 45,000
in 1768 1.900,000 57,000
Unfunded in 1774 250,000 7,500
Civil list debt in 1775 500,000[136]
--------- -------
Total 7.150,000 199,500
From 15.483,553_l._ the total of debts discharged, subtract 7.150,000_l._
the total of debts contracted; and the remainder, or 8.333,553_l._ will
be the diminution of the public debts since 1763. Also, from 561,342_l._
the total of the decrease of the annual interest, subtract 199,500_l._
(the total of its increase), and the remainder, or 361,842_l._ will
be the interest or annuity saved since 1763.—To this must be added
12,537_l._ _per ann._ saved by changing a capital of 1.253,700_l._ (part
of 20.240,000_l._) from an interest of 4 to 3 _per cent._ pursuant to
an act of the 10th of George III.; also the life-annuities that have
fallen in; and 7,500_l._ _per ann._ gained by the falling (in 1771) of
1.500,000_l._ from an interest of 3½ to 3 _per cent._; which will make a
saving in the whole of near 400,000_l._ _per annum_: And it is to this
saving, together with the increase of luxury, that the increase of the
_Sinking-Fund_ for the last ten years has been owing.
To the debts discharged the following additions must be made.
In 1764 there was paid towards discharging the extraordinary expences of
the army, 987,434_l._: In 1765, these expences amounted to 404,496_l._:
In 1766, to 479,088_l._—Total 1.871,018_l._—This sum is at least a
million higher than the extraordinary expences of the army for three
years in a time of peace. This excess, being derived from the preceding
war, must be reckoned a debt left by the war. And the same is true
of 1.106,000_l._ applied, in 1764, 1765, and 1766, towards satisfying
_German_ demands.—There are likewise some smaller sums of the same kind;
such as subsidies to _Hesse-Cassel_, _Brunswick_, &c. And they may be
taken at 200,000_l._—The total of all these sums is 2.306,240_l._; which,
added to 8.333,553_l._ makes the whole diminution of the public debt
since 1763, to be 10.639,793_l._
Soon after the peace in 1763, an unfunded debt, amounting to
6.983,553_l._ was funded on the _Sinking Fund_, and on new duties on wine
and cyder, at 4 _per cent._ There has been since borrowed and funded
on coals exported, window-lights, &c. 6.400,000_l._ The funded debt,
therefore, has increased since the war 13.383,553_l._ It has decreased
(as appears from page 171) 11.983,553_l._; and, consequently, there has
been on the whole an addition to it of 1.400,000_l._—During seven years,
from 1767 to 1774, 1.415,883_l._ navy-debt was paid off. See page 172.
But, as this is a debt arising from constant deficiencies in the peace
estimates for the navy, it is a part of the current peace expences.—In
1768 this debt was[137] 1.226,915_l._—In 1774 it was 1.850,000_l._; and
consequently, though 1.415,883_l._ was paid off, an addition was made to
it, in seven years, of 623,085_l._ It increased, therefore, at the rate
of 291,000_l._ _per ann._
The paper from which I have taken the following account, came into my
hands after almost the whole of this work had been printed off. It
contains a fact of so much importance, that I cannot satisfy myself
without laying it before the public.—In a Committee of CONGRESS in _June_
1775, a declaration was drawn up containing an offer to GREAT BRITAIN,
“that the Colonies would not only continue to grant extraordinary aids in
time of war, but also, if allowed a free commerce, pay into the SINKING
FUND such a sum annually for ONE HUNDRED YEARS, as should be _more_ than
sufficient in that time, if faithfully applied, to extinguish all the
present debts of BRITAIN. Or, provided this was not accepted, that, to
remove the groundless jealousy of _Britain_ that the Colonies aimed at
Independence and an abolition of the Navigation Act, which, in truth,
they had never intended; and also, to avoid all future disputes about the
right of making that and other Acts for regulating their commerce for the
general benefit, they would enter into a covenant with _Britain_, that
she should fully possess and exercise that right for _one hundred years_
to come.”
At the end of the _Observations on Civil Liberty_, I had the honor of
laying before the public the Earl of _Shelburne’s_ plan of Pacification
with the Colonies. In that plan, it is particularly proposed, that the
Colonies should grant an annual supply to be carried to the Sinking Fund,
and unalienably appropriated to the discharge of the public debt.—It must
give this excellent Peer great pleasure to learn, from this resolution,
that even this part of his plan, as well as all the other parts,
would, most probably, have been accepted by the Colonies. For though
the resolution only offers the alternative of either a _free_ trade,
with extraordinary aids and an annual supply, or an _exclusive_ trade
confirmed and extended; yet there can be little reason to doubt, but that
to avoid the calamities of the present contest, both would have been
consented to; particularly, if, on our part, such a revisal of the laws
of trade had been offered as was proposed in Lord Shelburne’s plan.
The preceding resolution was, I have said, drawn up in a Committee of
the Congress. But it was not entered in their minutes; a severe Act of
Parliament happening to arrive at that time, which determined them not to
give the sum proposed in it.
FINIS.
POSTSCRIPT.
The following POSTSCRIPT was published only in a few of the last Editions
of the _Observations on Civil Liberty_. It has been often referred to in
the preceding work; and therefore, it is necessary to give it a place
here.
_ACCOUNT of Public Debts discharged, Money borrowed, and Annual Interest
saved from 1763 to 1775._
Debts paid off since 1763. Annuity decreased.
£. £. _s._
1765 876,888 funded, bearing interest at
4 _per cent._ 34,835 10
1.500,000 unfunded, 4 _per cent._ 60,000 00
1766 0.870,888 funded, 4 _per cent._ 34,835 10
1.200,000 unfunded, 4 — 48,000 00
1767 2.616,777 funded, 4 — 104,671 0
1768 2.625,000 funded, 4 — 105,000 0
1771 1.500,000 funded, 3½ _per cent._ 52,500 0
1772 1.500,000 funded, 3 _per cent._ 45,000 0
1773 800,000 unfunded, 3 — 24,000 0
1774 1.000,000 funded, 3 — 30,000 0
1775 1.000,000 funded, 3 — 30,000 0
---------- -----------
Total 15.483,553 Total 568,842 0
In 1764, there was paid off 650,000l. navy-debt; but this I have not
charged, because scarcely equal to that annual increase of the navy-debt
for 1764, 1765, and 1766, which forms a part of the ordinary peace
establishment. The same is true of 300,000l. navy-debt, paid in 1767; of
400,000l. paid in 1769; of 100,200l. paid in 1770; 200,000l. in 1771;
215,883l. in 1772; and 200,000l. in 1774.
_Account of money borrowed and debts contracted since 1763._
Annual interest
£ increased.
Borrowed and funded,
at 3 _per cent._ in 1765 1.500,000 45,000
in 1766 1.500,000 45,000
in 1767 1.500,000 45,000
in 1768 1.900,000 57,000
Unfunded in 1774 250,000 7,500
Civil list debt in 1775 500,000[138]
--------- -------
Total 7.150,000 199,500
From 15.483,553l. the total of debts discharged, subtract 7.150,000l.
the total of debts contracted; and the remainder, or 8.333,553l. will
be the diminution of the public debts since 1763. Also, from 568,842l.
the total of the decrease of the annual interest, subtract 199,500l.
(the total of its increase), and the remainder, or 369,342l. will be the
interest or annuity saved since 1763.—To this must be added 12,537l _per
ann._ saved by changing a capital of 1.253,700l. (part of 20.240,000l.)
from an interest of 4 to 3 _per cent._ pursuant to an act of the 10th of
George III.; also the life-annuities that have fallen in; which will make
a saving in the whole of near 400,000l. _per annum_: And it is to this
saving, together with the increase of luxury, that the increase of the
_Sinking Fund_ for the last ten years has been owing.
To the debts discharged the following additions must be made.
In 1764 there was paid towards discharging the extraordinary expences
of the army, 987,434l. In 1765, these expences amounted to 404,496l.
In 1766, to 479,088l.—Total 1.871,018l.—This sum is 1.100,000l. higher
than the extraordinary expences of the army for three years in a time
of peace. This excess, being derived from the preceding war, must be
reckoned a debt left by the war. And the same is true of 1.106,000l.
applied, in 1764, 1765, and 1766, towards satisfying _German_
demands.—There are likewise some smaller sums of the same kind; such as
subsidies to _Hesse-Cassel_, _Brunswick_, &c. And they may be taken at
200,000l.—The total of all these sums is 2.406,240l. which, added to
8.333,553l. makes the whole diminution of the public debts, or the whole
saving of the kingdom, since 1763, to be 10.739,793l.