Upon Local Government, decisive action would be taken. ‘When Parliament

reassembles at the beginning of February next, the Government are

sanguine that they will be prepared with definite proposals on that

large question. Their object will be, as far as possible, to eliminate

party feelings and to secure for the consideration of the question as

large an amount of Parliamentary co-operation as can be obtained; so

that whatever settlement may be arrived at may not be regarded as a

political triumph of either party, but rather in the nature of a final

and lasting settlement.... The great sign-posts of our policy are

equality, similarity and, if I may use such a word, simultaneity of

treatment, so far as is practicable, in the development of a genuinely

popular system of government in all the four countries which form the

United Kingdom.’ He ended by declaring in simple terms that the verdict

of the constituencies for the maintenance of the Parliamentary Union

must be considered final and irreversible.

Such was the policy which Lord Randolph Churchill was permitted to

declare with the assent of the Prime Minister and of the Cabinet. In

order that there might be no misunderstandings, he took the precaution

of writing out the actual words and submitting them beforehand to the

principal Ministers. It was the policy of his own heart. It is the

policy which, in spite of some lamentable lapses, of many purposeless

and vexatious delays and of more than one incident of prejudice or even

tyranny, has upon the whole, as history records, been carried

laboriously forward by Unionist Administrations during nearly twenty

years and which in the end, whatever problems it has left unsolved, has

notably advanced the social, political and economic stability of the

Irish people.

Lord Randolph Churchill was much praised for his speech. The

Conservatives were in high spirits, and the newspapers next morning

emphasised the favourable impression which had been produced. Yet he

does not seem himself to have been much affected by these tributes; for

on being asked the next day ‘whether it is the intention of the

Government to introduce any changes in the fiscal laws of the country by

placing duties on imported manufactures, by taxing foreign corn, by

countervailing bounties or in any other respect,’ he replied, with an

odd gleam of foresight or of humour: ‘The ways and means for the year

1887-8 which the Government will propose to Parliament, will be

communicated to the House on or about March 31 next by the

person--whoever he may be--who at the time happens to be Chancellor of

the Exchequer.’

[Illustration: _Reproduced by permission of the proprietors of ‘Punch.’_

THE GRAND YOUNG MAN.

SHADE OF ‘DIZZY,’ _loquitor_:

You stand--at your age--where I stood after years

Of waiting on Fortune and working on fools.

Not forty! Unwearied by failures or fears.

To him who can use them are ever the tools,

But there’s an advantage you’ll scarce understand

In having the tools ready shaped to your hand.

_Punch_, August 7, 1886.]

The debate on the Address and its amendments was protracted. It had

opened with much calmness; but as it progressed the smouldering fires of

the great encounter began to sparkle. In this flicker the deep

antagonisms which the election had made permanent between friends and

parties, became visible. Lord Hartington’s speech on the third night was

uncompromising. Standing in the midst of his old colleagues on the Front

Opposition Bench, with much formal courtesy and weighty argument he made

it plain that he would exert his whole strength to sustain the Ministry

in power. He was heard by his party in moody silence, broken from time

to time by Irish interruptions and Tory applause. Mr. Parnell, who moved

next day an amendment of his own, took pains to cast back disdainfully,

as trash unworthy of notice, the material aid to Irish resources which

the Chancellor of the Exchequer had proffered. He spoke of the

‘dishonesty of bolstering up the system of landlord and tenant in

Ireland by the expenditure of large sums of money the repayment of which

is quite uncertain and highly problematic,’ and of the ‘folly of

building harbours of refuge for fishing-boats that do not exist.’ He

derided the proposal to spend three-quarters of a million on the

arterial drainage of the Bann and the Shannon, where nothing less than

ten millions would suffice. Fed by such fuel, an ugly glow grew

gradually in the House.

The sixth day of the debate on the Address was stormy. It began with an

unexpected motion for the adjournment of the House as a protest against

the despatch of Sir Redvers Buller to Kerry. The member who moved it,

Mr. Edward Russell, made an elaborate and indignant speech. He enlarged

on the iniquity of employing a military officer accustomed to dealing

with savage tribes to discharge duties which properly belonged to the

civil magistrate. Lord Randolph dealt with this motion in a summary and

even audacious manner. ‘In the opinion of the honourable gentleman,’

said the Chancellor of the Exchequer, ‘the appointment of Sir Redvers

Buller is a startling innovation in our Constitution, a serious blow to

civil and religious liberty, a wilful invasion of the immutable

principles of justice, and other things of that serious kind. He holds

strong opinions and he prophesies the most alarming results. He declares

that all Kerry will immediately take an active part in the proceedings

of the “Moonlighters” and that all Ireland will very shortly be involved

in a general conflagration. Now, sir, I do not complain of the

honourable member holding these opinions; they are opinions he is

perfectly entitled to hold and to express. What I want the House to do

is to compare the opinions he holds with the course he suggests. What is

the course he proposes? He proposes that the House of Commons should

immediately adjourn. What will be the effect of that course on Sir

Redvers Buller or his appointment? Absolutely none. The House would

adjourn, if they agreed with the honourable member, and, like the

Emperor Titus, might exclaim that they had lost a day; but, before the

House met again, Sir Redvers Buller would be well on his way to Kerry.

‘As to employing military officers in civil positions, had not Mr.

Gladstone after the London riots appointed Sir Charles Warren, an

officer on the active list, liable to be called away at any moment on

military service, not to look after “Moonlighters,” but after the

civilised inhabitants of London?’ He suggested that the motion had been

brought forward to delay the speech which Mr. Chamberlain, who had

obtained the adjournment on the previous night, was known to be about to

deliver. No greater compliment could be paid to a member than that his

opponents should show that they feared what he was going to say. ‘I have

to announce,’ he concluded, ‘that Her Majesty’s Government entirely

decline to take any part in the discussion.’

This was hard hitting, but it succeeded. ‘Lord Randolph Churchill,’ said

the _Times_ the next day, ‘pricked the bubble with a Disraelian

dexterity of touch.’ Angry speeches in reply failed to sustain the

debate. The fate of the motion was never for a moment doubtful, and on a

division it was rejected by a majority of 241 against 146.

The motion for the adjournment being thus brushed aside, the

consideration of Mr. Parnell’s amendment was resumed. The treatment

accorded to Mr. Chamberlain’s speech afforded some foundation for Lord

Randolph’s charge. He was repeatedly interrupted both from above and

below the gangway. Mr. Speaker was invited to notice the smallest

deviation from the strictest relevancy. Cries of fierce derision saluted

him from the Irish benches. The men around him did not conceal their

discontent. And in his turn he struck back with dexterous severity.

Ceremonious language, much ‘right honourable be-friending,’

smoothly-turned sentences, soft, purring accents, ineradicable

antagonism; such was his speech. It was the first of many similar

episodes in this new Parliament. Yet some respect is due to the

forbearance of the Liberal majority. For six weary years the

Liberal-Unionist leaders sat on the Front Opposition Bench. Their

followers held the balance of every division. Their authority sustained

the Conservative Government. Their debating skill was always at hand

when all else failed. They supported Coercion; they justified

Mitchelstown; they even defended the Special Commission; and with

decisive effect. Yet never once, not even at times of sharpest

indignation, were they denied by those who surrounded them their freedom

of debate.

The Government were naturally delighted at this decided support. ‘You

made a splendid speech last night,’ wrote Lord Randolph to Mr.

Chamberlain (August 27). ‘It is curious, but true, that you have more

effect on the Tory party than either Salisbury or myself. Many of them

had great doubts about our policy till you spoke.’

On September 1, Mr. Sexton brought forward an amendment drawing

attention to the Belfast riots, and this, of course, served as a

convenient peg on which to fasten an almost interminable series of

attacks upon Lord Randolph Churchill. At least twenty-five persons had

been actually killed in the streets and many hundreds injured or

arrested. All was attributed to the epigram, ‘Ulster will fight and

Ulster will be right.’ Sir Michael Hicks-Beach was able to make a good

defence. In spite of a long and solemn denunciation from Sir William

Harcourt, the Chancellor of the Exchequer remained silent; but the

debate ran on, full of life and spite, until on September 3 Mr.

Labouchere sought to provoke him by embodying a direct charge in a

special amendment. ‘Surely in vain the net is spread in the sight of any

bird,’ said Lord Randolph piously; ‘and of all the unskilful and clumsy

Parliamentary fowlers of whose manœuvres it has been my lot to be a

witness, I never met a sorrier practitioner than the honourable member.

In the various snares and wits and wiles with which he distinguished

himself in the last Parliament he only succeeded in this--that he made

himself the laughing-stock of the Parliament and of the public; and he

appears to be desirous to add to-night to his already great reputation.’

‘There was not,’ the speaker declared, with some boldness, ‘a shred of a

shadow of a shade, or a shade of a shadow of a shred’ of foundation for

such charges. So the attacks were brushed contemptuously away, and the

Government majority did not fail in the Lobby to endorse their Leader’s

disdain.

On September 3 the Chancellor of the Exchequer moved a resolution

securing precedence for the Committee of Ways and Means and of Supply.

So far as form was concerned, he based himself upon the precedent of

1841. But he ventured further upon an earnest yet restrained appeal to

the House. ‘We have pledged ourselves as a Government to produce at the

meeting of Parliament next year such schemes of legislation as we may be

able to decide upon and mature in the autumn and winter. If the

proceedings of this session were to be greatly protracted and if the

energies of members and Ministers were to be greatly exhausted by them,

it would become very difficult for the Government to summon Parliament

as early next year. I ask no consideration on behalf of the Government,

but in the interests of Parliament and of the country. This motion is

intended to wind up, with as much expedition as is reasonable and

decent, the business of the session, and to allow members to separate in

time for the annual recess. I would not for a moment wish the House to

understand that I am advocating a rapid or slovenly discussion of the

Estimates. I have always protested against that and always shall. I ask

only that the House will concentrate its attention on the Estimates and

proceed without unusual dilatoriness and loss of time. The difficulties

which lie in the future before the Government, are very great indeed. No

one can be more deeply impressed with their magnitude than my colleagues

and myself; and certainly I see no possibility of arriving at anything

like a solution of those difficulties unless the House is prepared to

give a reasonable amount of time during which the Government may take

thought for a future so anxious and grave.’

The effect of this appeal, conjoined as it was with a promise that Mr.

Parnell should have an opportunity for bringing forward his Tenants’

Relief Bill, was to induce the House to consent without a division to

endow the Government with full control over public time. Lord Randolph,

however, thought it proper to write a special letter of explanation to

Lord Hartington, fearing apparently lest the Whig leader should become

suspicious of any compact with the Nationalist party:--

Treasury Chambers, Whitehall, S.W.: September 5, 1886.

Dear Lord Hartington,--You will have observed in the papers that

the Government gave a promise to Parnell to afford him facilities

(_i.e._ a night) for laying his land proposals in the form of a

Bill before Parliament.

Whether this promise was a wise one or not, I will not say. There

were no doubt grave objections to any concession to Parnell of any

sort or kind, but I think if you had been in the House last week

you might have been of opinion that the objections to a course of

stolid resistance on the part of the Government were perhaps

greater.

However this may be I own that I am extremely anxious that (if

possible) when the Bill does come on, the Government may receive

your support in opposing it. Of course the Bill will only be

Parnell’s original amendment to the Address in another form, and

the Government will not give way an inch to him under any

consideration.

But Parnell has undoubtedly hopes, which if they are unsound cannot

be too clearly and speedily demonstrated to be unsound, that he can

make out a case so plausible for the tenants on the score of

inability to pay that he may secure the support or at least the

abstention of the Liberal Unionists; and of course if he were

successful in this the moral strength of the Government would be

seriously diminished, with corresponding disadvantage to other,

greater and more common interests.

I therefore trouble you with these few lines now, though I do not

suppose the discussion on the Bill can arise till next week at the

earliest.

Believe me to be

Very faithfully yours,

RANDOLPH S. CHURCHILL.

A friendly message emboldened the Minister to write more freely of his

difficulties:--

_Lord Randolph Churchill to Lord Hartington._

_Private._

September 13, 1886.

The position of this Government must always be most precarious. It

may have a long life; but it is a rickety infant, requiring the

most careful handling. The condition of the House of Commons, the

recklessness and utter lack of all sense of responsibility on the

part of the Opposition, their guerilla character and the want of a

leader who can control, is most alarming. There is no precedent

that I know of in our history of such a combination of ominous

circumstances. I hear you are going to India; and if this means

your absence from the House till March or April, I think it right

to tell you that without your support in Parliament this Government

cannot last. The assaults of an Opposition unrestrained by your

presence will be too desperate for me to sustain. A state of great

confusion will arise; the Government will go, and you will have to

try your hand. I feel awfully alone in the House of Commons, and am

glad to grasp an opportunity of placing things before you as I look

at them.

_Lord Hartington to Lord Randolph Churchill._

_Private._

Brantingham Thorpe, Brough, Yorkshire: September 14, 1886.

My dear Churchill,--I received your letter this morning before

leaving London, and am glad to know so fully your opinions on the

position in the House of Commons. It is quite true that I have some

doubt, which I expressed to Sir M. Hicks-Beach, as to resisting the

whole of Parnell’s Bill. I do not think that you can leave

expediency out of the question in dealing with the rights of Irish

landlords. They have very few friends; and if they are encouraged

to strain their rights, and if disorder could justly be put down to

their account, they would have still fewer.

It is quite clear that the intention is to fight the Nationalist

battle on the question of the land during next winter, and it will

be to Parnell’s advantage that there should be as many evictions as

possible. Your best chance is that he will not succeed in inducing

tenants who can pay to risk eviction. But if landlords evict

wholesale tenants who cannot pay, he may succeed in getting up

another very dangerous agitation. I thought, therefore, that this

was to a great extent a question for the Irish Government, and if

they considered a check on eviction necessary I should have been

inclined to grant it. But, as I understand, they think that the

Courts have already a considerable discretion which may be

sufficient, and undoubtedly any concession to Parnell would do harm

unless the evil of resistance is still greater.

I do not think that I misunderstood your action in giving Parnell a

day for discussion of his Bill, though I do not know the exact

reasons for the decision. But I certainly thought that, while you

were quite right to keep your absolute freedom of action in regard

to the Bill, you were not precluded from accepting any part of it

which the Irish Government might on further consideration think

necessary.

I shall always be very glad to communicate with you on

Parliamentary matters when you think it desirable, and can very

well understand the anxiety and responsibility of your position.

Yours very truly,

HARTINGTON.

The Address was disposed of in the first week of September and the House

plunged at once into Supply. Forthwith obstruction became patent and

flagrant. A select, determined and well-organised band, among whom Mr.

Labouchere was the best known, took charge of national interests. They

did not disdain trifles, however small; nor grudge study, however

laborious. It was the last chance of a minority under the unreformed

procedure. No Supply Rule, automatically fixing limits, regulated the

votes. No Closure aided the Minister. The Committee debated to their

hearts’ content, and on after that till they were sick and weary.

Business crawled forward on its belly in the small hours of the morning.

Any attempt on the part of the Leader of the House to accelerate its

passage was met by alternate motions to report progress and to adjourn.

Lord Randolph was teased with mischievous satisfaction upon all the

former manœuvres of the Fourth Party. It was a severe, if

appropriate, expiation. Nothing but imperturbable temper and physical

endurance availed. The Leader of the House was always in his place. He

listened to all the discussions. He defended every detail of the Civil

Service Estimates himself. On warlike stores, on public accounts, on

salaries in the House of Lords, on secret service and town holdings and

polluted rivers, on poor ratepayers and gold coinage, he was found

suave, adroit, and well informed.

‘The Chancellor of the Exchequer,’ observed the _Times_, not always a

friendly critic (September 17), ‘is making great progress in the art of

so answering questions as to keep the House in a good temper. This he

does sometimes by judicious concessions, sometimes by a sly turn of

humour, sometimes by a touch of good-natured irony.’ Indeed, he used

every Parliamentary art and all the resources of his many-sided

character. Sometimes he coaxed and sometimes he complained. Sometimes he

resisted with vehemence only to make surrender an hour or two later more

valued. Once, as has been shown, he appealed earnestly and with success

to the House. Once he rapped out that the tactics of the obstructionists

were ‘not conceived in the public interest,’ and after an angry debate

made a reconciliation with them and secured incidentally some progress.

He knew the House in all its moods. He humoured it and offended it and

soothed it again with practised deliberation. Yet he always appeared to

be its servant. Ministers and Governments were but the respectful

stewards of the public service. Parliament had rights and authority over

them, to which, however capriciously asserted, they must bow: ‘My own

opinion,’ he said when his attention was roughly drawn to a criticism of

the Public Accounts Committee on some departmental practice, ‘is that

the Comptroller and Auditor-General and the Public Accounts Committee,

acting together, ought to be a superior authority to the Treasury; and

that, if they distinctly lay down a rule as to the expenditure of money,

it is the business of the Treasury to acknowledge that authority as

superior to their own.’ The member, Mr. Arthur O’Connor, who had

complained, was so contented with this soft answer that, after

congratulating the Chancellor of the Exchequer ‘upon the breadth of view

with which he always looks at matters of this kind,’ he withdrew his

motion for the reduction of the vote. Thus, inch by inch, Supply crept

forward.

The Irish members watched Lord Randolph hourly. He and they had

obstructed so often together that both sides knew enough of each other’s

ways not to be deceived by blandishments or manœuvres which would

captivate the innocent spectator. Soured and indignant as they were--not

unnaturally--by the turn of events, in their hearts they nourished a

certain secret sympathy for the conqueror. They enjoyed seeing the game

played scientifically, and they realised how different their new

antagonist was from the prosaic authoritarians who chafe the hearts of

Celtic peoples. At last the Estimates were done. ‘It is due to the

Chancellor of the Exchequer,’ said the _Times_ (September 16), ‘to say

that no Leader of the House of Commons in recent years has met

obstruction, open and disguised, with more exemplary patience.’

The general satisfaction of the Conservative party at Lord Randolph’s

management of the House of Commons found expression in much solicitude

for his health. ‘Don’t worry yourself and get knocked up,’ wrote Mr.

Chamberlain (September 1). ‘I do not believe that the Irish will keep

you sweltering very much longer.’ ‘You really must take more care of

yourself,’ Mr. Balfour insisted. ‘Now that the main business of the

Address is got over, I cannot see why you should spend so much time in

your place in the House.’ And Lord Salisbury on the 14th: ‘I am afraid

your work is getting intolerably hard. Don’t sit up too much.’

‘I am particularly commanded,’ said Lord Iddesleigh, writing from

Balmoral on the 16th, ‘by the Queen to say that Her Majesty was greatly

amused by the contents of your box last night. I suppose you won’t

understand this message without the gloss--there was a sprinkling of

tobacco in it.

‘Her Majesty is very sympathetic over the sufferings of our friends in

the House of Commons. You have indeed a very hard task and it is not

very clear how it is to be lightened.’

Only Mr. Parnell’s Bill remained after the Estimates were passed. Two

days (September 20 and 21) were occupied in its discussion. The Bill was

badly drawn. Mr. Gladstone supported it in principle; but was forced to

object to nearly every detail. Lord Hartington was severe in his

condemnation. The Government declared they would have nothing whatever

to do with it. Mr. Morley alone was fortunate in his advocacy. It was

rejected by 297 to 202. Ministers were much advantaged by having

persuaded their opponents to expose themselves to the perils of

constructive policies.

Lord Randolph Churchill ended the session amid golden opinions.

Congratulations and goodwill flowed in upon him from all sides. He

himself was in high spirits. ‘You must find it very hard work,’ said an

admirer, ‘leading the House and at the same time being at the

Exchequer.’ ‘Not half such hard work as it was getting there,’ was the

droll answer. The party newspapers were loud in their praises. All

doubts about his tact and patience were dispersed, and Conservative

members hurried off to the country feeling that a great man had arisen

among them, and that ‘Elijah’s mantle’ had lighted upon no unworthy

shoulders. The Sovereign wrote him an autograph letter of exceptional

favour:--

Balmoral Castle: September 22, 1886.

Now that the session is just over, the Queen wishes to write and

thank Lord Randolph Churchill for his regular and full and

interesting reports of the debates in the House of Commons, which

must have been most trying.

Lord Randolph has shown much skill and judgment in his leadership

during this exceptional session of Parliament.

[Illustration: Balmoral Castle:

Sept: 22, 1886.

Now that the session is just over the Queen wishes to write and thank

Lord Randolph Churchill for his regular and full and interesting reports

of the debates in the House of Commons, which must have been]

[Illustration: most trying. Lord Randolph has shown much skill and

judgment in his leadership during this exceptional session of

Parliament.]

Difficulties abroad were soon added to the difficulties at home. At the

end of August foreign affairs in Eastern Europe were suddenly plunged

into crisis through the kidnapping of Prince Alexander by Bulgarian

officers under Russian influence, and his consequent abdication. The

Chanceries of Europe throbbed with excitement and apprehension. To

Lord Randolph Churchill the news was specially unwelcome. He did not

concern himself too much about Constantinople, and cared nothing at all

for Turkey. The sentiments which had in 1878 induced him to write to Sir

Charles Dilke, offering, if the Liberals would support him, to move a

vote of censure upon Lord Beaconsfield’s foreign policy, were unaltered.

The freedom and independence of the Slav, Bulgarian and Hellenic peoples

seemed to him still a wise and lofty object; but any sympathies which he

had for stifled or struggling nationalities were strictly controlled.

Great Britain should not shrink from her share in the responsibilities

of Europe; but no duty of isolated intervention lay upon her. He had,

moreover, been deeply impressed by the satisfactory manner in which the

Afghan frontier dispute had been settled. He had become much more

hopeful of a good understanding with Russia than when he had first gone

to the India Office. Above all, he was resolved to offer no wanton

provocation which might lead by Russian reprisals in Asia to the

reopening of a question of such grave importance to the tranquillity of

the Indian Empire.

The proceedings of the Foreign Office seriously disquieted him. As early

as September 4 he wrote to Lord Salisbury: ‘I have just read Lord

Iddesleigh’s telegram to Lascelles, telling him to prevent Alexander

from abdicating and to cause him to appeal to the Great Powers. I think

this is very unfair on Alexander. Iddesleigh knows perfectly well that

the Great Powers won’t move a finger, and he knows we cannot act outside

a most Platonic range. I am afraid of our incurring moral

responsibilities towards the Prince and his people which may lead us on

far without previous calculation.... I do most earnestly trust that we

may not be drifting into strong and marked action in the East of Europe.

It will place us in great peril in the House of Commons, politically and

financially.’ And again on the 6th: ‘Iddesleigh’s last telegram to

Lascelles is really _un peu trop fort_. I do think we ought to have an

immediate Cabinet before such messages are sent. I look at the series

together; the two first were startling, but recognised European concert,

which the last altogether flings aside. W. H. Smith concurs strongly

that the Cabinet ought to meet. Any moment it may leak out at Sofia that

we are taking strong action.... Lord John Manners made a remark to me at

4.30 this afternoon symptomatic of surprise that there had been no

Cabinet. As you know I loathe Cabinets, you will feel that this is

disinterested; but I own to being frightened.’ The Prime Minister

consented to summon his colleagues, adding merely that he and Lord

Iddesleigh were agreed as to the policy, but that the Cabinet could

overrule them if it thought fit. The Cabinet, however, cleared the air

and led to better understandings.

Lord Randolph Churchill to Lord Salisbury.

Treasury Chambers, Whitehall, S.W.: September 15, 1886.

Dear Lord Salisbury,--Another desperate night in the H. of C. You

may imagine how bad was the Irish conduct when Beach’s last words

to me were: ‘I am now all for a strong Clôture.’ ...

M. de Staal has just been to see me. He declaimed against White....

I said that in view of our occupation of Egypt it was necessary

that we should have a representative at Constantinople of character

and resolution. He said the Bulgarians had done something or other

rude to the Emperor’s portrait at Sofia. He spoke of the great

difficulty Russia had in coming to an understanding with Austria on

account of the Hungarians, who thought of nothing but ‘49.’ He

tried to ascertain my views as to our interests in the Balkan

territories; my reply was (speaking only for myself) that our chief

interests were Egypt and India, and that anything which affected

our interests in those countries would necessitate very strong

action on our part. Speaking generally, I said that with Ireland on

our hands, our foreign policy, except under great pressure, would

naturally be pacific. He asked about the position of the

Government. I told him that Gladstone was hopelessly out of it, and

was no longer young enough to get into it again; that his principal

supporters were hopelessly discredited and divided; that Hartington

possessed great balancing influence, but could not look to forming

a Government himself; that whether this particular Government

lasted or no, power was with the Conservative party, whose

political organisation and strength were increasing and improving

every day; that such a fact as London returning forty-three

Conservatives against four Gladstonians ought to have great weight

with him in appreciating the Conservative position.

Finally, I hinted at an understanding with Russia by which she

should give us real support in Egypt, abandon her pressure upon

Afghanistan, in which case she might settle the Balkan matters as

she would--or, rather, as she _could_!

Yours most sincerely,

RANDOLPH S. CHURCHILL.

A few days later Lord Salisbury was able to retire to his villa near

Dieppe, although the situation still continued critical and obscure. The

Chancellor of the Exchequer, delighted by Lord Salisbury’s proposal to

change the British Agent at Sofia, seems to have made great efforts to

bring his opinions nearer to those of his chief. On the 23rd he reports

an interview with Count Hatzfeldt. ‘I told him that I had been thinking

much over what had passed between us about the East of Europe, and that

I had come to this conclusion as a member of the House of Commons and

from a House of Commons point of view: Any anti-Russian policy which

involved England taking the lead ostensibly on the side of Turkey,

either about Bulgaria or even Constantinople, would probably place the

Unionist party in great peril, might fail to receive the support of the

constituencies, and would be savagely assaulted. An anti-Russian policy,

however, in which Austria took the lead supported by Germany, we could,

I thought, well fall in with, and hold our own easily in the House of

Commons. He said: ‘That is all very well; but what will be wanting, will

be Germany’s support of Austria. Our eyes are riveted on France.’ I

said, if that was really so, of course we could not play; but that it

occurred to me that it was not impossible that if Germany and Austria

took the lead against Russian advance and in defence of Bulgarian

independence, and we followed and joined loyally and thoroughly, I

thought that would seem to entail logically action on our part,

diplomatic or otherwise, against France if she tried to be nasty. He

seemed much interested by this, and I impressed upon him at parting not

to forget that it must be to Germany’s interest that the Unionist party

and the Government should endure and remain strong; that foreign policy

on our part which followed the lead of Germany and Austria would not try

that strength too high, and might be carried far; but that foreign

policy against Russia in the East of Europe which left the initiative to

England would be a policy too dangerous, seeing the other great

interests we had to defend, for us to contemplate. I told him these were

mere House of Commons views, for his own private information for

whatever they were worth, and that he was not to consider them in any

other light.

‘I don’t know whether you will think this expression shows any change of

views from what I have expressed to you recently. I do not think it does

really....’

‘If Russia attacked Constantinople,’ wrote the Prime Minister in a

letter approving generally of this discourse, ‘and all the other Powers

refused to intervene, I am rather disposed to the idea that we should

have to act in the Dardanelles; but I hope the contingency is too

improbable to require us to trouble about it.’ The Chancellor of the

Exchequer replied meekly that he would be quite agreeable to ‘a

piratical seizure of Gallipoli.’ ‘There is,’ he adds, ‘a practical

flavour about such a step which would commend it to the most Radical and

peace-loving House of Commons.’ Lord Salisbury detected a flavour of

levity in this answer.

‘You are naturally sarcastic,’ he wrote on the 28th, ‘on my Dardanelles,

and I hope the matter will not come up in our time. But the possession

by Russia of Constantinople will be an awkward piece of news for the

Minister who receives it. The prestige effect on the Asiatic populations

will be enormous, and I pity the English party that has this item on

their record. They will share the fate of Lord North’s party.

‘At the same time I know the great military objections there are to the

Dardanelles scheme.’

Further activity at the Foreign Office renewed the correspondence. On

the 30th Lord Randolph wrote again urgently to the Prime Minister:--

I have read with the utmost dismay Iddesleigh’s telegram to

Lascelles instructing him to inform the Bulgarian Government that

our Government approve of the reply sent by them to the Russian

Note.

What is the reason for this apparently isolated and certainly most

risky action? I cannot make out that an opinion was ever asked for

directly, which makes such instructions all the more strange. Have

we any right to express approval in so pointed and uncalled for a

manner, without at the same time letting those poor Bulgarians know

that beyond the merest diplomatic action we cannot go? I thought,

when you told me some days ago that Lascelles was to be changed

that that meant a modification of policy. I see no use in changing

the agent in this case, if the policy to which objection has been

taken is to be even more accentuated.

Why cannot Iddesleigh consider the propriety of trying to act at

Sofia in conjunction with the Austrian, German and Italian

Governments, and, if joint action is for the moment impossible,

abstaining from any action at all? We shall never get joint action

while Iddesleigh keeps rushing in where Bismarck fears to tread.

What I would like to see aimed at would be a Second Berlin

Memorandum--this time addressed, not to Turkey, but to Russia, and

England joining in. But all chance of such a document, which would

imply irresistible forces, fades further and further into the

distance.

Our action with Austria means war with Russia. Our action with

Austria and Germany means peace. But I feel sure that our present

niggling, meddling, intriguing, fussy policy is gaining for us the

contempt and dislike of Bismarck every day. I do pray you to

consider these matters. It was supposed that Lord Iddesleigh would

act under your direction. I feel certain that much that he has done

has been done on his own account. After all, it is very fine for

him now; but the day of trial will come when all this has to be

explained and defended in the House of Commons.

Now I have risked your wrath by inflicting this jeremiad upon you,

but it is the last, for I go abroad Sunday and shall know no more

till I return.

‘Like you,’ replied Lord Salisbury from Puys, on October 1, ‘I am not

happy about foreign affairs, but not entirely for the same reason. I do

not wholly take your view about our attitude towards Russia. I consider

the loss of Constantinople would be the ruin of our party and a heavy

blow to the country: and therefore I am anxious to delay by all means

Russia’s advance to that goal. A pacific and economical policy is up to

a certain point very wise: but it is evident that there is a point

beyond which it is not wise either in a patriotic or party sense--and

the question is where we shall draw the line. I draw it at

Constantinople. My belief is that the main strength of the Tory party,

both in the richer and poorer classes, lies in its association with the

honour of the country. It is quite true that if, in order to save that

honour, we have to run into expense, we shall suffer as a party--that is

human nature. But what I contend is, that we shall suffer as a party

more--much more--if the loss of Constantinople stands on our record....

I am therefore rather uneasy about foreign affairs--for I am afraid you

are prepared to give up Constantinople: and foreign Powers will be quick

enough to find that divergence out. On the other hand I sympathise with

you in some uneasiness as to the course of the Foreign Office. Many

things, I fear, are not done--and I am disquieted at the result ... when

I get back to England I may be able to exert a stronger influence.’

_Lord Randolph Churchill to Lord Salisbury._

Treasury Chambers, Whitehall, S.W.: October 3, 1886.

Dear Lord Salisbury,--I was not able to write yesterday and thank

you for your letter, as I had to go down to Dartford.

You must not think that I in any way disagree from what you urge

about Constantinople. It is only that I have a great doubt whether

the particular method and scheme of policy which was carried out at

the time of the Crimean War, and again to a great extent in

1876-78, is the best. I doubt whether the people will support that

method; and it seems to have this enormous disadvantage, that it

enables Austria to lie back.

We can, I think, perfectly defend Constantinople by going in for

the independence of Bulgaria; and we can best obtain that

independence by persuading Austria to take the lead.

But no doubt the proceedings of Lascelles, and the probable

proceedings at Constantinople of Sir W. White, are more in

accordance with the old policy, which I fear is now impracticable,

than with a modification of that policy.

Please do not suspect me of indifference to a matter on which you

feel so strongly. My only business and object are to bring, in the

best way I can, any policy which you wish carried out into favour

with the House of Commons and the constituencies, so far as it may

be possible for me to influence either. You must remember that you

have not spoken on these matters either in the Lords or the

country, and I am only anxious that you should find a _terrain_

well prepared.

I am off to-morrow night and out of reach of everybody till 23rd.

Lord Randolph Churchill’s speech at Dartford (October 2) was probably

the most important of his life. Upwards of twenty thousand Conservatives

were gathered to receive him. Nearly a hundred addresses from all parts

of the country were presented to him by deputations. The town was bright

with flags by day and fireworks by night. Standing upon an improvised

platform among the picturesque glades of Oakfield Park, and backed by

the solid phalanx of Conservative members which Kent had returned to

Parliament, the Chancellor of the Exchequer unfolded to an audience,

variously computed at from twelve to fourteen thousand persons, the

future legislative programme of the Government. He extolled the loyalty

of the Unionist Liberals. He reiterated the declarations upon Ireland

which he had made to the House of Commons. In order that the Unionist

party might legislate, as he described it, upon ascertained facts and

not, like Mr. Gladstone, by intuition, he recounted the appointment of

the four Royal Commissions on Irish Land, on Irish Development, on

Currency and on Departmental Expenditure. He urged a complete reform of

House of Commons procedure, including the institution of the Closure by

a simple majority. He announced that the Government would introduce a

Bill which should provide facilities, through the operation of local

authorities, for the acquisition by the agricultural labourer of

freehold plots and allotments of land. And in this connection he spoke

gratefully of the pioneer work which Mr. Chamberlain and Mr. Jesse

Collings had performed. He held out the promise of an alteration in the

law of tithe, so that payment should, in the first instance, be demanded

of the landlord; and a threat to remodel railway rates so that the home

producer should not be undercut by the foreigner. He mentioned a Land

Bill for making the transfer of land easy and cheap; a broad

reorganisation of Local Government with a new assessment and application

of local taxation; and finally he said: ‘I will not conceal from you

that my own special object, to which I hope to devote whatever energy

and strength or influence I may possess, is to endeavour to attain some

genuine and considerable reduction of public expenditure and consequent

reduction of taxation. I shall be bitterly disappointed if it is not in

my power after one year, or at any rate after two years, to show to the

public that a very honest and a very earnest effort has been made in

that direction.’ Such was the Tory Democratic programme. Nor should it

be supposed that these were the unauthorised views of a single Minister.

All these legislative projects had received the consent of the Cabinet.

Nearly all have since been passed by Conservative Administrations into

law.

Then the speaker turned to foreign affairs, and here he contrived,

without doing violence to his own convictions, to support faithfully and

effectively in its general tenor Lord Salisbury’s policy: but he used

very different arguments from those which Conservative audiences were

accustomed to applaud.

‘We had every reason to hope,’ he said, ‘that the union of Eastern

Roumelia with Bulgaria under the sovereignty of Prince Alexander would

develop a prosperous and independent nation, in the growing strength of

which might ultimately be found a peaceful and true solution of the

Eastern Question. Those hopes have been for the moment to a great extent

dashed. A brutal and cowardly conspiracy, consummated before the young

community had had time to consolidate itself, was successful in

this--that it paralysed the governing authority of the Prince and

deprived Bulgaria of an honoured and trusted leader. The freedom and

independence of Bulgaria, as well as of the kingdoms of Servia and

Roumania, would appear to be seriously compromised. It has been said by

some, and even by persons of authority and influence, that in the issues

which are involved England has no material interest. Such an assertion

would appear to me to be far too loose and general. The sympathy of

England with liberty and with the freedom and independence of

communities and nationalities, is of ancient origin, and has become the

traditional direction of our foreign policy. The policy based on this

strong sympathy is not so purely sentimental as a careless critic might

suppose. It would be more correct, indeed, to describe such a policy as

particular, and, in a sense, as selfish; for the precious liberties

which we enjoy, and the freedom of Europe from tyranny and despotism,

are in reality indissolubly connected. To England Europe owes much of

her modern popular freedom. It was mainly English effort which rescued

Germany and the Netherlands from the despotism of King Philip of Spain,

and after him from that of Louis XIV. of France. It was English effort

which preserved the liberties of Europe from the desolating tyranny of

Napoleon. In our own times our nation has done much, either by direct

intervention or by energetic moral support, to establish upon firm

foundations the freedom of Italy and of Greece.... A generation ago

Germany and Austria were not so sensitive as they are now to the value

of political liberty. Nor did they appreciate to its full extent the

great stability of institutions which political liberty engenders; and

on England devolved the duty--the honourable but dangerous duty--of

setting an example and of leading the way. Those were the days of Lord

Palmerston; but times have changed, and the freedom and the independence

of the Danubian Principalities and of the Balkan nationalities are a

primary and vital object in the policy of the Austro-Hungarian Empire.

Those things being so, it may well be that England can honourably and

safely afford to view with satisfaction that Power whose interests are

most directly and vitally concerned, assuming the foremost part in this

great international work. We must, of course, take it for granted, as I

am doing, that the liberty-giving policy of the Treaty of Berlin will be

carefully and watchfully protected. Whatever modification this great

fact may enable us to make in our foreign policy, whatever diminution of

isolated risk or sole responsibility this may enable us to effect, you

may be certain of one thing--that there will be no sudden or violent

departure by Her Majesty’s present Government from those main principles

of foreign policy which I have before alluded to, and which for nearly

three centuries mark in strong, distinct and clear lines the course of

the British Empire among the nations of the world.

‘There are Powers in Europe who earnestly and honestly desire to avoid

war and to preserve peace, to content themselves with their possessions

and their frontiers and to concentrate their energies on commercial

progress and on domestic development. There are other Powers who do not

appear to be so fortunately situated, and who, from one cause or

another which it is not necessary to analyse or examine, betray from

time to time a regrettable tendency towards contentious and even

aggressive action. It is the duty of any British Government to exhaust

itself in efforts to maintain the best and the most friendly relations

with all foreign States and to lose no opportunity of offering friendly

and conciliatory counsels for the purpose of mitigating national

rivalries and of peacefully solving international disputes. But should

circumstances arise which, from their grave and dangerous nature, should

force the Government of the Queen to make a choice, it cannot be doubted

that the sympathy--and, if necessary, even the support--of England will

be given to those Powers who seek the peace of Europe and the liberty of

peoples, and in whose favour our timely adhesion would probably, and

without the use of force, decide the issue.’

It would be hard to say whether this speech made more stir at home or

abroad. For more than a week the declarations upon British foreign

policy were the chief theme of the Continental press. And in Berlin,

Vienna and Rome they received a measure of welcome which grew as their

phrasing was more carefully examined. Lord Randolph’s outspoken

condemnation of the Bulgarian kidnapping conspiracy was declared to give

a satisfaction to the moral feelings of Christendom which had been

looked for in vain in the late utterances of European statesmen. The

announcement that Great Britain would take her part in the work of

preserving international peace, and that her influence would be

exerted upon the side of the Central Powers--not for the sake of the old

pro-Turkish policy, but in the name of the liberties of the Balkan

peoples--was accepted with the utmost satisfaction in Berlin. The style

of the declaration created an impression of calm authority; and

‘Palmerston Redivivus’ is an expression which repeatedly appears in the

foreign despatches and articles of that time.

[Illustration: _Reprinted by permission of the proprietors of ‘Punch.’_

‘YOUTH ON THE PROW AND PLEASURE AT THE HELM!’

_Punch_, August 14. 1886.]

At home the Conservative party was too much astonished to give vent

immediately to any effective opinion. The party newspapers generally

applauded the proposals and tone of the speech as ‘temperate,

reasonable, and practical.’ The _Times_ observed that the programme in

its scope and fulness ‘recalled the palmy days of Mr. Gladstone.’ The

Opposition, with evident disgust, denounced the Chancellor of the

Exchequer as ‘an unscrupulous opportunist’ who had stolen the policies

of his Radical opponents and had calmly appropriated their famous motto

of ‘Peace, Retrenchment and Reform.’ It was not until some days had

passed that the perplexed anxiety in Tory circles found expression in

grumblings that the Prime Minister was being effaced by his lieutenant.

But even then no sign could be discerned in any quarter of a wish or

intention to repudiate the policy declared.

From all this buzzing, friendly and unfriendly alike, Lord Randolph fled

secretly and silently. For more than a week he was lost to the public

eye. It was rumoured that he had passed through Paris and Berlin on

October 7; but it was not until the 12th that ‘Mr. Spencer,’ an English

tourist, who with his friend Mr. Trafford had been looking at picture

galleries, museums and theatres at Dresden and Prague, was identified

with the orator of Dartford.

Few things were more remarkable in Lord Randolph Churchill’s brief

career than the quickness with which he acquired a European reputation.

All over the Continent he was already regarded as the future master of

English politics. The tension in the East was unrelieved and the

diplomatic skies were grey and shifting. Here was the second personage

in the British Cabinet, fresh from a most important public statement,

travelling _incognito_ through Germany and Austria. What had he done in

his passage through Berlin? Had he a mission to Bismarck? Had he been to

Varzin or not? From this moment his movements were watched with the most

minute and provoking curiosity and the fullest details were telegraphed

to every capital. The press revived memories of Gambetta’s journey to

Frankfort, and perhaps beyond, two years before his death. We learn from

the foreign intelligence of the _Times_ of October 13 that ‘Mr. Spencer’

and Mr. Trafford, ‘the two travellers whose every step is watched by the

European press,’ have been ‘residing at the Imperial Hotel [Vienna]

since yesterday.’ They had been received by a crowd at the station, and

several persons who had seen Lord Randolph Churchill in England had

‘maintained most positively’ that ‘Mr. Spencer’ was identical with the

Chancellor of the Exchequer. We are told that ‘Mr. Spencer’ looked

somewhat fatigued, and retired to rest after telling the landlord ‘in

emphatic terms’ that he had come to Vienna for nobody, and proposed

without exception to receive no one; that he walked about the town both

in the morning and afternoon, and visited among others the shop of Herr

Weidmann ‘where the most exquisite Vienna leather goods are made’; that

in the evening he had heard Millöcker’s operetta ‘The Vice-Admiral’ at

the Theater an der Wien; and that he was everywhere dogged by

journalists, who gave the public elaborate descriptions of his person,

the shape of his hat and the colour of his coat.

‘I am hopelessly discovered,’ wrote Lord Randolph to his wife (October

12). ‘At the station yesterday I found a whole army of reporters, at

whom I scowled in my most effective manner. Really it is almost

intolerable that one cannot travel about without this publicity. How

absurd the English papers are! Anything equal to the lies of the _Daily

News_ and _Pall Mall_ I never read: that _Pall Mall_ is most

mischievous.... W. H. Smith is here, and we had a long talk last night.

I have got him to go and see Paget--who wanted me to go and dine with

him--and tell him that as I saw no one at Berlin I did not wish to see

anyone here. The reporters have been besieging the hotel this morning,

but I have sent them all away without a word. The weather is fine and

bright, though there is an autumn chill in the air.... This pottering

about Europe _de ville en ville_ suits me down to the ground, if it

were not for the beastly newspapers.’

His holiday was a short one. On his way back through Paris he had an

interview which would certainly have interested those curious folk who

had pried so zealously upon his unguarded leisure:--

_Lord Randolph Churchill to Lord Iddesleigh._

Hôtel Bristol, Paris: October 19, 1886.

Dear Lord Iddesleigh,--This morning Count d’Aunay called upon me. I

think, from what he said, that he had been sent by Freycinet, I

used to know D’Aunay very well when he was in London. I left him to

begin what he had to say, and kept talking about _la pluie et le

beau temps_. At last he rapped it out. He said the Egyptian

Question was going to be ‘re-awakened.’

I asked what question.

He said the reorganisation of the administration, the tribunals,

the customs, the army.

I said I did not see that any of these pressed; that Wolff and

Mukhtar had got to make their report, which would take some time to

consider; that, in the meantime, everything was going on quietly;

that the country was progressing; that the payment of the coupon in

full would be resumed next year; and that I could not conceive what

object there was in raising the Egyptian Question in a critical

manner now.

He said that the French were most desirous to co-operate with

England in the re-establishment of Egypt; that they wished to be

perfect friends with us, but that M. de Freycinet felt that Egypt

was a continual _pierre d’achoppement_, and that there would always

be great difficulties until it was got out of the way; that public

opinion in France was now much agitated on the question; that they

suspected we meant to take Egypt altogether; and that they must

know what we intended to do about retiring.

I replied that it was impossible to reconcile this great desire on

M. de Freycinet’s part for friendship with the tone of the French

Press on the proceedings of French agents at Constantinople; but

that, in any case, of this he might be certain--that these things

did not influence our policy in the least; that we did not intend

to retire from Egypt until a stable Government had been constituted

there, able to maintain itself and to pay its way; and that we

should not ‘budge an inch’ from that resolution _pour quoi que ce

soit, ni pour qui que ce soit_; that the work would take a long

time, perhaps three years, perhaps five years, or perhaps ten

years, or longer; but that till it was done our occupation of Egypt

would continue.

He appeared much pained and upset by this, and argued for a long

time that we could do nothing in Egypt on any question without

French assistance.

I said we were most anxious for French assistance, although up to

now we had managed to rub along without it; but that if there was

to be any understanding for the solution of Egyptian questions

between the two Governments, it must be upon the basis of our

continued occupation of Egypt until certain definite and practical

results were obtained which would be a reward to us for all the

loss of money, men, time and trouble which our occupation had

entailed on us.

He said we ought to fix a date for evacuation; that that would

remove all suspicion of bad faith; that the French were obliged to

press the point on account of their enormous interests and their

numerous colony; that in the time of the ‘condominium’ they had

occupied a perfectly satisfactory position, which they wished to

regain.

I reminded him that they had deliberately abdicated that position

when M. de Freycinet was Minister before; that they had left us all

the trouble and all the danger, and that they must accept the

logical results of that policy; that I saw no good in fixing a

date for evacuation; that I did not think such a step would be

honest, as we might not be able to abide by our pledge; that it was

much better to define the work which had to be done, and to adjourn

all questions of retirement until the completion of the work.

He went on pressing about the date in a curiously imploring manner.

He said that it might be _aussi éloigné que vous voulez_, but that

if we would only fix a date M. de Freycinet _sera parfaitement

satisfait_, that he would work loyally with us, and that all would

go differently.

I then said that this question of the date, to which he evidently

attached so much importance, was a new one to me; that I could not

tell what your opinions were, nor Lord Salisbury’s; that personally

I saw immense and insuperable objections to such a course; that it

would really introduce a new element of uncertainty, and probably

lead to great trouble. In conclusion, I entreated him not to be

under any illusion as to our determination to remain in Egypt and

to pursue our work there steadily; that the present Government,

unlike Mr. Gladstone’s, was very strong in Parliament, and would

not yield to pressure; and that, till the French thoroughly grasped

this fact, they would fail to understand the A B C of the Egyptian

Question.

He said he should tell M. de Freycinet all I had said. He asked me

if I wished to see M. de Freycinet, to which I replied in the

negative.

I thought you would wish to know all this, and I hope you will

approve of what I said. I return to town on Tuesday.

Yours very truly,

RANDOLPH S. CHURCHILL.

‘You seem to have defended the pass well, and the position you hold is a

sound one,’ replied Lord Iddesleigh in a letter which appears to be the

last that passed between them.

Short as his absence from England had been, Lord Randolph found some

difficulties aggravated on his return. The orthodox portions of the

Conservative party had become articulate. Mr. Chaplin was denouncing the

Closure by a simple majority as unconstitutional and improper. The

_Times_ had made up its mind against such a change, which it regarded as

‘irreconcilably at variance with the fundamental principle of freedom of

debate.’ It expressed itself anxious to know what would have been the

opinion of the former leader of the Fourth Party on the proposals of the

new Chancellor of the Exchequer. The ‘Dartford programme,’ as the

principles and measures expounded in Kent had already come to be called,

notwithstanding the full approval which it had previously received from

the Cabinet, had been exposed to various attacks in quarters usually

believed to derive their information from official sources. The Carlton

Club was reported to be vexed and sulky. Everywhere the question was

asked: What would the Chancellor of the Exchequer say to the conference

of Conservative Associations at Bradford? Would he be discovered in

retreat or standing to his guns? Would he enlarge upon the Dartford

programme or would he explain it away?

The conference met at Bradford on October 26. Lord Randolph made three

speeches during the day. At the evening meeting he said he was very

sorry he had made the Dartford speech. ‘If I had not made it at Dartford

three weeks ago, I might have made it here to-night.’ He stood to the

policy then declared in every detail. He welcomed Mr. Jesse Collings as

an ally in the Allotments Bill. He asserted that Closure by a simple

majority was the ‘motor muscle’[56] of any reform in Parliamentary

Procedure. He ridiculed the complaints of the Liberal party. ‘All they

can do apparently is to exclaim with impotent rage, “How unfair! how

shameful! how unprincipled! You have stolen our programme.” Why “their

programme,” I should like to know? Since 1880 they have been in office,

and they did not make an attempt to carry out a single item. They tell

us that the programme I sketched at Dartford is a Radical programme;

that the Tory party have turned their coats and abandoned their

principles and adopted the principles of the Radical party; and

quantities of sentences of that kind and of equal stupidity. All I know

about the programme of policy, foreign and domestic, which I endeavoured

to outline at Dartford three weeks ago is this--that it was a mere

repetition of the programme of Lord Salisbury at Newport in 1885. All I

know about my speech at Dartford which I can say in reply to what I am

told as to its being a total adoption of Radical principles and measures

is this--that it was a mere reiteration and elaboration of the Queen’s

Speech of January last, when Lord Salisbury’s first Government was in

office, and of the speeches of the Ministers who supported the policy

which was contained in that speech.’

These statements were greeted by the loud and continuous acclamations of

an audience of Conservative delegates representing, it was calculated,

fully a million and a half electors.

This determined speech and its thunderous endorsement silenced for the

moment all hostile criticism. Some of Lord Randolph’s colleagues

expressed to him their disapproval of the attacks upon him from within

the Conservative ranks. Others assured him of their agreement. Even the

Lord Chancellor was satisfied. ‘I have just finished reading your speech

at Bradford,’ he wrote (October 27). ‘There is not a word that is not

sound, good Toryism--aye, and old Toryism, too. The truth is that the

enemy have been so long dressing up a lay figure which they have

invested with their notions of what a Tory ought to be, that they do not

recognise the genuine article when they see it.’

It is a pity not to end the story here. Lord Randolph Churchill seems at

this time to have been separated only by a single step from a career of

dazzling prosperity and fame. With a swiftness which in modern

Parliamentary history had been excelled only by the younger Pitt, he had

risen by no man’s leave or monarch’s favour from the station of a

private gentleman to almost the first position under the Crown. Upon the

Continent he was already regarded as the future master of English

politics. His popularity among the people was unsurpassed. He was

steadily gaining the confidence of the Sovereign and the respect and

admiration of the most serious and enlightened men of his day. His

natural gifts were still ripening and his mind expanding. The House of

Commons had responded instinctively to the leadership of ‘a great member

of Parliament.’ Alike in the glare and clatter of the platform and in

the silent diligence of a public department he was found equal to all

the varied tasks which are laid upon an English Minister. If he were

thus armed and equipped at thirty-seven, what would he be at fifty? Who

could have guessed that ruin, utter and irretrievable, was marching

swiftly upon this triumphant figure; that the great party who had

followed his lead so blithely, would in a few brief months turn upon him

in abiding displeasure; and that the Parliament which had assembled to

find him so powerful and to accept his guidance, would watch him creep

away in sadness and alone?

Still, for an interval the sun shone fair. The clouds were parted to the

right and to the left, and there stepped into the centre of the world’s

affairs--amid the acclamations of the multitude and in the hush of

European attention--the Grand Young Man.

CHAPTER XV

THE CHANCELLOR OF THE EXCHEQUER

‘Those who live to the future most always appear selfish to those

who live to the present.’--EMERSON.

At the Treasury the appointment of the new Chancellor of the Exchequer

had been received with no little apprehension. Every great department

has an atmosphere and identity of its own. No politician, however

popular in the country or influential in Parliament, can afford to be

indifferent to the opinion formed of him by the Civil Servants through

whom and by whom he works. Concealed from the public eye among the

deeper recesses of Whitehall, seeking no fame, clad with the special

knowledge of life-long study, armed with the secrets of a dozen

Cabinets, the slaves of the Lamp or of the Ring render faithful and

obedient service to whomsoever holds the talisman. Whatever task be set,

wise or foolish, virtuous or evil, as they are commanded, so they do.

Yet their silent judgments of their masters and their projects do not

pass unheeded. Although the spell still works, it loses half its potency

if these spirits are offended or alarmed; and padded walls of

innumerable objections, backed by the masonry of unanswerable argument,

restrain the irreverent or unworthy from the fullest exercise of the

powers they may have won by force or favour.

Over all public departments the department of finance is supreme.

Erected upon the vital springs of national prosperity, wielding the

mysterious power of the purse, the final arbiter in the disputes of

every other office, a good fairy or a perverse devil, as ‘My Lords’ may

choose, to every imaginative Secretary of State, the Treasury occupies

in the polity of the United Kingdom a central and superior position. No

school of thought is so strong or so enduring as that founded on the

great traditions of Gladstonian and Peelite finance. Reckless Ministers

are protected against themselves, violent Ministers are tamed, timid

Ministers are supported and nursed. Few, if any, are insensible to the

influences by which they are surrounded. Streams of detailed knowledge,

logic and experience wash away fiscal and financial heresies; and a

baptism of economic truth inspires the convert not merely with the

principles of a saint but--too often--with the courage of a martyr.

To many who had spent their lives at the Treasury, Lord Randolph’s

arrival was a shock. They regarded him, we are told, as ‘an impossible

man,’ as ‘one whose breath was agitation, and whose life a storm upon

which he rode.’[57] They had instinctively resented the assaults he had

delivered against Mr. Gladstone, ‘the best friend the Civil Service ever

had.’ They remembered that, not long before, Lord Randolph had made

himself the mouthpiece of a harsh attack upon one of their number. He

was known to have expressed privately a candid opinion that they were ‘a

knot of damned Gladstonians.’ Lastly, they had read his Fair Trade

speeches; and, notwithstanding the reputation he had made at the India

Office as a departmental chief, he still appeared in the eyes of

Treasury officials as a Minister who would ride roughshod over their

habits and violate all their most cherished financial canons.

This mood was short-lived. The disquieted officials found a Minister

assiduous and thorough in work and scrupulously patient and quiet in

discussion. He possessed the very rare gift of keeping his mind

exclusively devoted to the subject in hand, and impressed on all those

with whom he worked the idea that the business on which they were

employed was the only one of interest to him. No time spent with the

Chancellor of the Exchequer was ever wasted. No interruption of any sort

was suffered. No one ever left his room after an interview without

having at any rate gained a clear knowledge of his views and intentions.

Around all played an old-fashioned ceremony of manner, oddly mingled

with a sparkle of pure fun, which charmed everybody. In a month the

conquest was complete. Every official worked with enthusiasm in his

service and all their mines of information were laid open to his hand.

It has often been said that Lord Randolph won his popularity among

permanent officials by his subservience to their views. This is by no

means true. If he cast away altogether as vicious and unpractical the

Fair Trade opinions which he had urged, and which commanded so much

support among the Tory democracy, it will also be seen that he was able

to enlist the interest and positive support of his subordinates in

schemes far outside the orthodoxy of the official mind. His stay at the

Treasury was short; but his memory was long respected. He left behind

him golden opinions and dearly treasured reminiscences. He took away

with him friendships which lasted him his life.

‘Our anxiety,’ wrote Lord Welby in 1896, ‘as to our new chief was soon

dispelled. He met us from the outset with perfect frankness, which soon

became cordiality; and I cannot recall a word or a line of his during

his autumn office which I should have wished unspoken or unwritten. Not

that he was an easy or an unexacting chief. He expected subjects to be

laid before him fully, clearly and intelligently; and he was keen to

mark default. He was, in short, a Minister of the type that Civil

Servants appreciate. He ruled as well as reigned. He had a mind, and

made it up; a policy, and enforced it. He was quick in acquiring

information, quick in seizing the real point, quick in understanding

what one wished to convey to him, impatient in small matters and details

and contemptuous if one troubled him with them. Above all, he was

accessible; ready and willing to hear what one had to say, whether it

accorded with his own views or not. Doing business with him was most

interesting. Not being a respecter of persons he criticised freely and

pointedly men and matters.... In “chaff” he was unsurpassed. He was

singularly free from affectation of knowledge he did not possess. Could

one fail to take an interest in a chief “who always showed us sport”?’

Many tales of Lord Randolph in these days have been preserved. We have a

glimpse of his first meeting with a rather dismayed subordinate in the

historical Board Room at the Treasury--the stiff and formal cut of his

frock-coat, the long amber cigarette-holder, so soon produced, the

eternal cigarette, and ‘an old-world courtesy of manner’ which surprised

and disarmed a preconceived dislike. We see him going down to the City

with Sir Edward Hamilton to lunch formally with the Governor and

Directors of the Bank of England and hovering for half an hour outside

in a panic of nervousness which robbed him for the time of his

self-confidence. We see him once, and once only, when the Court of

Exchequer, presided over by its Chancellor, settles the list from which

Sheriffs are selected, in his robes of office--those imposing and

expensive robes which seem to assert the opulence which should result

from thrift, rather than thrift itself. His cynicism was disarming. We

are told how, when the dreadful subject of bimetallism cropped up, he

turned to Sir Arthur Godley and said: ‘I forget. Was I a bimetallist

when I was at the India Office?’ When he received an influential

deputation of sugar-refiners and sugar-planters in protest against the

foreign Sugar Bounties, he created general consternation by inquiring,

with immense gravity, ‘Are the consumers represented upon this

deputation?’ We are even told how he complained to a clerk who put some

figures before him that they were not clear and he could not understand

them. The clerk said that he had done his best, and, pointing them out,

explained that he had reduced them to decimals. ‘Oh,’ said Lord

Randolph, ‘I never could make out what those damned dots meant.’ But

this was surely only to tease.

[Illustration: _Reproduced by permission of the proprietors of ‘Punch.’_

BELLEROPHON JUNIOR.

‘I THINK THIS’LL FETCH ’EM!!’

‘The Chancellor of the Exchequer states to the Board that Her Majesty’s

advisers desire to satisfy themselves that the clerical establishments

of the Civil Service, of the Naval and Military Departments, and also of

the Revenue Departments, are organised generally upon a principle which

secures efficiency without undue cost to the public.’--_Treasury

Minute_, Sept. 14.

_Punch_, September 25, 1886]

From the very commencement of his career at the Treasury Lord Randolph

began the exertions for economy to which he felt himself bound by his

electoral pledges. In his private affairs he was usually extravagant and

often unbusiness-like; but public money seemed to him a sacred trust.

The character and extent of Treasury control over expenditure is very

often misunderstood. It is represented sometimes almost as a statutory

or constitutional power over the other departments. Such an idea is a

complete delusion. The Chancellor of the Exchequer is able to exert his

influence in two ways: first, over administration. In small matters not

connected with policy, the Treasury acts upon a set of well-defined

rules and principles, which the spending departments recognise and

endeavour not to infringe and which are enforced more or less strictly,

according to the relative authority of the Chancellor of the Exchequer

and the other Ministers concerned. Secondly, there is the wide domain of

policy; and in all great matters the control of the Treasury is neither

more nor less than the personal influence of the Chancellor of the

Exchequer upon the Cabinet. Of Lord Randolph’s attempt to assert that

influence the next chapter must give some account; but in the meanwhile

he laboured with industrious severity to effect administrative

economies. On September 14 a Treasury Minute announced the appointment

of a Royal Commission to inquire into the establishment and organisation

of the great spending departments: ‘The Chancellor of the Exchequer

states to the Board that Her Majesty’s advisers desire to satisfy

themselves that the clerical establishments of the Civil Service, of the

Naval and Military Departments and also of the Revenue Department, are

organised generally upon a principle to secure efficiency without undue

cost to the revenue.’ A variety of petty economies were effected by his

personal authority. He discovered, among other things, that Government

specie had to be conveyed in merchant ships, at much expense, because an

old custom entitled naval officers to a high percentage. His indignation

at hearing that Her Majesty’s gold could not be conveyed in Her

Majesty’s ships because of claims by Her Majesty’s officers led to

immediate action, and the practice was reformed forthwith.

A remark by the Comptroller and Auditor-General in one of his reports to

Parliament drew his attention to another abuse. Of old times sums were

issued out of the Civil List to the Secretary of the Treasury for secret

service. No public account was rendered of the money thus expended. In

1783, many evils being alleged, Parliament, under the influence of

Burke, was persuaded to limit this grant to 10,000_l._ a year; and that

amount was yearly issued to the Secretary of the Treasury from 1783 to

1886. This branch of secret service was, of course, political and was

quite distinct from that which is ordinarily known as foreign secret

service. The money was used for the purposes of political organisation

by the party which happened to be in power. Such a custom could not on

any valid ground be defended. Yet for over a century the grant had never

been seriously questioned. It might have been urged that the Liberals

had always profited by this sum during their long period of power and

that many famous men had assumed responsibility for it. Lord Randolph

brushed such wire-puller’s arguments aside. Before he had been in office

a month he introduced a Bill, which passed rapidly through Parliament,

abolishing this payment altogether, and it has never since been renewed.

Until 1886 there had existed an octroi duty on coal coming into the

Metropolis, the proceeds of which were divided between the City and the

Metropolitan Board of Works. The principle of this duty was not

unpleasing to the Conservative party. Its abolition was roundly

denounced by the _Standard_ and in high Tory circles. The Metropolitan

authorities were glad to get money in an easy and painless manner.

Powerful interests objected to a rise in the rates, while the abolition

of a duty upon a necessary of life which affected the poor consumer, did

not elicit much enthusiastic support. Lord Randolph took some time to

make up his mind. He decided that an octroi duty was out of date, that

it was a survival of a financial policy that had been emphatically

condemned. He declined to countenance its renewal. His speech to the

deputation may be read with profit by any who care to see the arguments

against such an octroi put tersely, forcibly and without reserve. His

impressions at the Treasury seem to have stimulated his mind to great

activity and to have aroused in him a keen financial instinct. All sorts

of plans were being moved forward by his agency towards and into the

sphere of political action. He contemplated the purchase of Irish

Railways by the State and their use as an instrument of economic

development and of political and strategic control; and Lord Salisbury

himself seems to have been persuaded by his arguments. He paid the

closest attention to the coinage, and harboured a deadly design against

the half-sovereign--‘that profligate little coin’--which he believed was

an expensive and unnecessary feature of British currency. But there was

one great scheme which overshadowed all the rest.

Parliament had no sooner risen than Lord Randolph turned to the

preparation of his Budget. He knew that the duties of leadership in the

next Session would demand his whole attention and physical strength;

and, in spite of the labours of the memorable year, 1886, he succeeded,

by what Sir Algernon West has described as ‘a performance never

equalled,’ in getting ready and laying before the Cabinet his financial

proposals for the year 1887-8. For nearly twenty years his projects have

been veiled in mystery. The silence of the Treasury has remained

unbroken. The few high officials who were admitted to his confidence and

whose sympathy was enlisted in his plans, have kept their own counsel.

Lord Randolph did not choose in any public speech to reveal what he had

purposed. He is the only Chancellor of the Exchequer who never

introduced a Budget; and in his lifetime rumour alone asserted that he

had ever formed one. The time has now come when the abandoned Budget of

1887-8 may be fully unfolded in the form in which, during November,

1886, it received the provisional assent of Lord Salisbury’s Cabinet.

The reader who has accustomed himself to the giant Budgets of modern

times must turn his mind and contract his fancy to the humbler figures

of a vanished age. The cost of governing the United Kingdom and of

providing for the defence of the Empire during the early ‘eighties

fluctuated between eighty and ninety millions a year. This was in itself

a distinct increase on the estimates of Lord Beaconsfield’s

Administration; and Tory speakers were wont to dwell with genial malice

upon the fact. The various wars which had disturbed Mr. Gladstone’s rule

had left their marks upon the economy of the Army. The money raised by

the Vote of Credit in 1885 had been scattered with a lavish hand, and

prominent men in both parties were concerned to notice some apparent

relaxation in the strictness of Treasury control. Few, indeed, thought

so seriously of the future as Lord Randolph Churchill, and his

prediction that a ‘Hundred-million Budget’ would be an event of the

future was generally regarded as unduly pessimistic. But nevertheless

the times were not unfavourable to retrenchment, and there was a healthy

demand for departmental reform. With estimates standing at under ninety

millions small economies were not disdained. The Ministers of those days

had not learned to expand their view of the public resources. A saving

of a hundred thousand pounds was regarded as a matter of legitimate

congratulation. A reduction of a million was an achievement.

Yet at the same time the narrow scrutiny to which expenditure had been

so long subjected and the habitual reluctance of statesmen to enlarge

its bounds, left no very obvious opportunities to the new Chancellor.

The field had, except for some small patches, been well and thriftily

gleaned. Nor did it seem at first sight that the system of taxation

which had for five years received Mr. Gladstone’s approval would readily

lend itself to striking or sensational treatment.

On the other hand, however, more than one great tendency to change was

apparent. The whole question of the Sinking Fund was ripe for

reconsideration. The remodelling of the death duties thrust itself

before every Chancellor each succeeding year. Above all, the inevitable

and swiftly approaching departure in Local Government, involving as it

did a complete readjustment of national and local finance and the

transference of large responsibilities and resource from Whitehall to

the County and Borough Councils, required a strong and daring mind at

the Treasury.

Certainly Lord Randolph Churchill’s plan did not err on the side of

timidity. He contemplated nothing less than a complete reconstruction of

the revenue. The general rate of expenditure and the whole condition of

the National Debt were examined anew by a searching and audacious eye.

Hardly a single tax was left untouched. The death duties, the house

duties, the stamp duties, the wine duties, were all the subject of

reform. Immense reductions were proposed in existing taxes. Numerous new

taxes were devised. All these changes were not a mere meddlesome and

vexatious shifting of burdens from one shoulder to the other. They were

each and all essential parts in a vast financial revolution.

The first object of the Chancellor of the Exchequer was to effect a

large and substantial reduction in taxation. He desired especially to

diminish those taxes which fell upon the lower middle class. He laboured

to transfer the burdens, so far as possible, from comforts to luxuries

and from necessaries to pleasures. He applied much more closely than his

predecessors that fundamental principle of democratic finance--the

adjusting of taxation to the citizen’s ability to pay. His second object

was to provide a much larger sum of money for the needs of local bodies,

so that the impending measure of Local Government might be wide and real

in its character. His third object was to effect a certain definite

economy in the annual expenditure.

The estimates with which he was confronted amounted to 90,400,000_l._

The income which the existing taxes were expected to yield was

90,000,000_l._ The Chancellor of the Exchequer proposed to augment his

income by extra taxation aggregating 4,500,000_l._--namely, by an

increase in the death duties of 1,400,000_l._, and in the house duties

of 1,500,000_l._; by extra stamps to yield 284,000_l._; and by a wider

application of corporation duty, worth 315,000_l._; by the revival of a

tax on horses to produce 500,000_l._; by an increased tax on wine to

produce 250,000_l._; and by certain minor taxes, to be considered later,

which were estimated to produce 300,000_l._ He proposed to diminish his

expenditure by withholding the 2,600,000_l._ local grants-in-aid, for

which a new provision was to be made; by a reduction in the charge for

the debt of 4,500,000_l._; and by a direct economy of 1,300,000_l._ He

had, therefore, raised his income to 94,500,000_l._, and reduced his

expenses to 82,000,000_l._, thus becoming possessed of a surplus income

over expenditure of 12,500,000_l._ This surplus he intended to

distribute variously. 5,000,000_l._ were to be available for the

purposes of Local Government, in lieu of the old grants-in-aid of

2,600,000_l._ The indirect taxpayer was to be relieved by a reduction of

the tea duties from 6_d._ to 4_d._, costing the revenue 1,400,000_l._;

and by a reduction of 4_d._ in the tobacco tax, costing 500,000_l._ The

income-tax payer received the greatest advantage, for by a remission,

costing no less than 4,870,000_l._, the rate of the income-tax was to be

lowered from 8_d._ in the pound, at which it stood in 1886, to 5_d._ in

1887. These outgoings together aggregated 11,770,000_l._, and the

Treasury was left with a final surplus of 730,000_l._

These proposals require to be more closely examined. The principal

feature of the new taxation was the re-grading and increase of the death

and house duties. The death duties in force in 1886-7 were four in

number--namely: (1) Probate duty upon the _personal_ property passing on

the death of any person, irrespective of destination; (2) the account

duty, imposed since 1881 chiefly as a preventive to evasion of probate

duty, and chargeable in respect of personalty included in voluntary

settlements--death-bed gifts, &c.; (3) the legacy duty, upon benefit

derived by the successor to _personal_ property of the deceased at rates

according to consanguinity; and (4) the succession duty, upon benefit

derived by the successor to settled personalty and to the _real_

property of the deceased, also at rates depending on consanguinity,

chargeable, however, on the life interest and not on the capital value.

Lord Randolph Churchill approached this complicated system of taxation

with the double object of obtaining a larger revenue by a simpler

method. He wanted more money and less machinery, fewer taxes and an

increased return. His early inquiries at Somerset House and the

discussion of the first suggestions which, coming fresh to the subject,

he

[Illustration:

Expenditure

90. 400 000

deduct 2. 600 000 lord grants in

4. 500 000 charge for do

1. 300 000 diminished

-------------

82. 000 000

Surplus income over expenditure

12. 500,000

liquor licenses

remit to local bodies 5. 000 000 other ---

3d. income tax 4. 870 000 [words illegible]

2d. off. tea duties 1. 400 000

4d. --tobacco-- 500 000

-------------

11 770 000]

[Illustration:

Budget (Facsimile).

Income

90. 000 000

add

Extra taxation

1. 400 000 death duties

1. 500 000 House duties

204 000 extra stamps

315 000 Corporation duty

500 000 horses

300 000 Sundries

250 000 wine

-----------------

94 500 000.

12 500 000

11 770 000

-----------

730 000 Surplus income.]

put forward, served to convince him that a higher symmetry and

co-ordination were required. He saw that any scheme which involved four

or five different duties, and which attempted to deal with _personal_

estate by means of a graduated _ad valorem_ tax on the estate as a

whole, and later with _real_ estate by means of consanguinity on

individual benefits, would not bear controversial examination. The death

duties had grown up in a series of successive expedients. They were an

admitted patchwork, but a patchwork to which the House of Commons had

become accustomed. So long as they were left untouched, their anomalies

and entanglements would be tolerated, or even admired; but if they were

to be remodelled, re-graded and, above all, increased, they would have

to stand fire, their whole structure would be criticised, and a new plan

would be damned because it resembled an old plan long respected. The

Chancellor of the Exchequer, therefore, began next to inquire as to the

‘possible effect of a graduated _ad valorem_ tax on _real_ estate

corresponding to the graduated tax on _personal_ estate,’ and his mind

was soon determined in favour of such an assimilation of the death

duties on the two classes of property. The method by which to achieve

this object involved, of course, the whole question of graduation.

Should graduation be regulated by the total mass of property passing by

any one death, whether composed of realty or personalty; or partly of

one and partly of the other; or should it be governed by the total

benefit received by an individual on succession, whether out of realty

or personalty, or both combined? Should the rate of duty depend upon the

total wealth of the testator or upon the respective windfalls of the

heirs? These questions have been long and fiercely debated. The Childers

Budget of the year before had aimed at an equalisation of the death

duties on _real_ and _personal_ property by means of an extension of the

account duty, but it contained no element of graduation. The rate of

duty was to be the same for large properties as for small (except very

small) estates, and was to apply equally to realty as to personalty.

Lord Randolph did not adopt this idea. His scheme was to graduate the

duty according to the value of the individual succession. What the

living man got, not what the dead man left, was to be the unit of

graduation.

If, for example, by the death of A., X. took 2,000_l._ _personalty_ and

3,000_l._ _realty_, Lord Randolph would have combined the two, and have

applied the rate (say, 3 per cent.) levied on a succession of 5,000_l._

If by the same death Y. took 20,000_l._ _personalty_ and 30,000_l._

_realty_, Lord Randolph would have applied the rate (say, 6 per cent.)

for a succession of 50,000_l._; and so on, always graduating the rate

according to any one person’s succession; so that the successor to a

small benefit would pay a low rate of duty, and the successor to a large

benefit a high rate of duty. In short, Lord Randolph was for a graduated

succession duty instead of a graduated estate duty. The Finance Act of

1894 has asserted and established the opposite principle. Sir William

Harcourt looked simply at what a dead man left or liberated, and on the

aggregate of that amount the graduation now in force depends. Thus it

may very well happen, and often does happen, that a successor to a small

benefit--perhaps a succession worth no more than 500_l._--pays the

highest rate (8 per cent.) of estate duty; because his succession is

part of an aggregate estate worth one million. The principle which

governs the Finance Act of 1894 was laid very plainly before Lord

Randolph in 1886. But he rejected it in favour of the graduation on the

individual succession, saying, after one long discussion at Somerset

House, ‘My instinct tells me that it is wrong.’ It is curious that his

instinct, whether right or wrong on the technical question, anticipated

the principal objections which Mr. Balfour and Mr. Chamberlain urged

against Sir William Harcourt’s Bill, and indicated the line of principle

to which the whole Conservative party was subsequently committed.

This choice being made, the Chancellor of the Exchequer turned his

attention to the principle of consanguinity. Why should graduation be

regulated by kinship? Does not kinship find its adequate expression in

the dispositions made by the testator? Does not the testator naturally

select his wife and children as the objects of his bounty in preference

to relations of remoter degree? Why should the State complicate its

affairs by recognising the principle of consanguinity in a taxing

statute? Lord Randolph Churchill therefore proposed to discard the

principle of consanguinity altogether. All existing duties on

properties of whatever kind, passing by death after a given date, and in

dispositions taking effect after that date, were to be swept away. Real

property was to be placed on the same footing as personalty, and

chargeable no longer on life interest, but on capital value. The one

graduated succession duty, graduated on amount of benefit received and

not depending at all upon consanguinity, was to replace them all. The

old probate, account, legacy, inventory (Scotland) and succession duties

were to be left to work themselves out by lapse of time, that process

being accelerated by a liberal system of discounts.

It is, perhaps, of some interest to contrast this scheme with that which

now holds the field. We now enjoy a duty called ‘estate duty’; an extra

duty, levied in certain circumstances on settled property, called

‘settlement estate duty’; and, finally, the legacy and succession

duties, depending on the consanguinity existing between the donor and

the donee. We now assert the vicious principle of taxing property

instead of persons. We try to tax the dead instead of the living. The

State refuses to consider for purposes of graduation anything so

personal as the sacrifice of the heirs, and bases itself on the mass of

the inheritance. Conjoined with this in utter contradiction we have a

cumbrous and elaborate recognition of such a purely personal and private

principle as consanguinity.

Lord Randolph would have replaced these four or five duties of great

complexity by one intelligible tax. He would have substituted one Act

of Parliament for thirty or forty. He would have secured a far greater

flexibility in case further increases of direct taxation were necessary.

A vast simplification of the accounts required would have notably

diminished the expenses of lawyers, valuers, accountants and actuaries,

now attendant on the payment of death duties. The just complaint of the

small inheritor from a great estate would have been prevented; and for

various illogical or contradictory methods the one simple principle

would have been erected, that taxation should be proportioned to ability

to pay and to benefit received. The increase which Lord Randolph

contemplated in the death duties would have been unpopular with the

Conservative party. He was informed that the estate of nearly every

member of the House of Lords would have been prejudicially affected

thereby. But, in view of what befell in 1894, it is clear that wealthy

people would not have been in the long run the losers by an early

settlement.

The tax upon inhabited houses was respectably ancient in its origin. It

had been first imposed in 1696, and had continued at various rates till

1834. Repealed in 1834, it was reimposed in 1851 by Sir Charles Wood on

the abandonment of the duty on windows, and at the rate of 6_d._ for

shops, beer-houses and farmhouses, and 9_d._ for dwelling-houses (those

under 20_l._ annual value being exempt), it yielded in the financial

year 1885-6 1,867,377_l._ to the revenue. Lord Randolph proposed to

repeal the existing Act, thus cutting away the many important

exemptions it contained, and by a new Act to restore the house duty to

what it formerly was--namely, a tax on all houses inhabited either by

day or night. He intended to revert to the old principle of graduation,

to the old definition of an inhabited house and to the old lowest limit

of taxable value. The new Act would further have repealed the provision

in the law under which only one acre was to be included with the house

for purposes of valuation--excepting the case of agricultural lands

attached to farmhouses. Mills and warehouses used for storing goods were

to be exempt; but it was provided that any person on the register of

voters in respect of the occupation of a tenement should be liable to

assessment for that tenement or part of a building; including even all

who were entitled to vote under the service franchise as occupiers of

apartments in Militia or other barracks. The scale of duty was lower for

shops than for private houses, and progressed rapidly as the value

increased. Value under 20_l._: shops, 3_d._; cottages, 4_d._ Value over

20_l._ and under 50_l._: shops, 6_d._; private houses, 9_d._ Value over

50_l._ and under 150_l._: shops, 1_s._; private houses, 1_s._ 6_d._

Value over 150_l._ and under 300_l._: shops, 2_s._; private houses,

3_s._ Value 300_l._ and upwards: shops, 2_s._ 6_d._; private houses,

3_s._ 6_d._ This new tax was estimated to produce, on existing

valuations, an additional revenue in the first year of 1,500,000_l._,

and, what was of even more importance (having regard to future Budgets),

was estimated to rise to 2,380,000_l._ in the second and subsequent

years.

Under the heading of ‘extra stamps’ the Chancellor of the Exchequer

proposed: (1) An alteration in the scale of duty upon patent medicines.

The scale then in force under an Act of George III., and continued to

this day, presses rather heavily on the 1_d._ and 2_d._ boxes, &c., of

medicines sold in poor neighbourhoods. Lord Randolph’s new scale would

have afforded relief to these small parcels, and have more than recouped

itself on the larger and more costly.[58]

The yield of the old duty had been steadily increasing in later years.

In 1869-70 it had produced 72,000_l._; in 1879-80, 135,000_l._; in

1885-6, 178,000_l._ It was estimated that Lord Randolph’s duty would

produce an increase of between 50,000_l._ and 70,000_l._ in the first

year (not, of course, complete) and of 100,000_l._ in the second year.

But the yield of the future would have been much richer. The old scale

of duty still in force produced in 1904-5 not less than 331,000_l._ Had

Lord Randolph’s scale been in force the extra revenue would probably by

now have exceeded 250,000_l._ a year.

The Chancellor of the Exchequer also proposed: (2) A 2_s._ per cent.

stamp duty on the share capital of joint-stock companies. He estimated

this to produce 100,000_l._ yearly, and 58,000_l._ in the year 1887-8.

This plan was adopted by Mr. Goschen in 1888. The results exceeded

expectation, and the tax yielded in the first year 158,000_l._ In 1899

the duty was increased to 5_s._ on share capital, and extended at

half-scale to loan capital. The yield for 1904-5 was 388,000_l._ from

share capital and 73,000_l._ from loan capital.

(3) A group of proposals comprising an extension of receipt duty to sums

between 10_s._ and 2_l._; the repeal of certain exemptions, such as a

receipt written upon a bill of exchange, or upon a duly stamped

instrument, acknowledging receipt of consideration money therein

expressed; a duty on tickets of admission to places of amusement (French

plan) and upon certain documents in the nature of vouchers, e.g. those

given to persons making purchases at stores and other large trading

establishments; a duty on certificates of proprietorship of shares, and

upon letters of application for stock; and an assimilation of the duty

on transfers of debenture and ordinary stock. This last has been since

effected. The others, with all that may be urged in their behalf, must

stand upon their mere recital. This group of revised duties was

estimated to produce an additional 150,000_l._ a year, and the whole of

the alterations in the stamp duties would have yielded 284,000_l._ in

the first year and above 400,000_l._ in the next.

A yearly tax of 5 per cent. was imposed in 1885-6 on the income of

corporations as an equivalent for the death duties, which they escape.

The yield in the first year was 34,000_l._ Municipal corporations were,

however, exempted, although they paid income-tax on their realised

property. By repealing this exemption Lord Randolph Churchill would have

considerably increased the yield of the duty. Taking the accounts of ten

municipal corporations of mixed sizes and importance, it was found that

the average income derived from rentals, waterworks, gasworks, tolls,

&c., exclusive of interest on investments, was 38,000_l._ Assuming there

were 275 corporations--an assumption which left an ample margin--the

gross income assessable would have been 10,450,000_l._, yielding a

revenue of 522,000_l._ From this, however, a large deduction had to be

made for interest paid on loans raised on the security of the property

apart from the rates, leaving as the result of the tax a net addition to

the revenue of 315,000_l._

The Chancellor of the Exchequer proposed also to revive the tax upon

horses and the special tax on racehorses which had been abandoned by Sir

Stafford Northcote in 1874, from which a sum of 500,000_l._ would accrue

to the State. In 1888, when Mr. Goschen endeavoured to re-introduce this

duty, no serious objection was raised by the House of Commons. Strong

opposition was, however, excited by the wheel and van tax which he

suggested at the same time. In the hope of carrying the unpopular tax by

linking it with one more favoured, Mr. Goschen declared that the two

taxes must stand or fall together.

But the House was not to be cajoled. Both projects were withdrawn, and

the transfer which has since taken place of all analogous duties to

local authorities, seems permanently to have interfered with any attempt

to secure this convenient source of revenue for Imperial purposes.

Two other classes of proposed extra taxation remain to be considered. If

every one of the 70,000,000 cartridges which were used each season had a

1_d._ revenue stamp pasted over the shot end, the national resources

would be enriched by 280,000_l._[59] in a complete year. The sportsman

whose unerring aim never required a second barrel, except for another

bird, would in poetic justice enjoy a comparative immunity. But while

his unskilful companion blazed away he might remember that at each

discharge the stamp blown to pieces by the explosion would carry its

tribute to the public treasury. Besides this, mainly with a view to

putting a stop to their reckless use by boys and others, pistols were to

be taxed 1_l._ a year and pistol-dealers 20_l._ a year; and brokers,

whose responsible functions seemed to deserve some recognition from the

State, were to be duly licensed at 5_l._ a year. By these sundries

300,000_l._ would be secured immediately, and about 400,000_l._ in a

complete year. The augmentation of the wine duties by various devices,

falling chiefly upon the higher quality wines, so as to yield an

additional quarter of a million, raised the total of the new taxation to

4,500,000_l._ in the first year, with a considerable natural growth in

prospect.

Of the steps by which Lord Randolph designed to diminish his expenditure

only one need be considered here; for the transference of the

2,600,000_l._ grants-in-aid to another and larger fund is a matter

chiefly of book-keeping, and the definite economy of 1,300,000_l._ which

he regarded as so important belongs to another part of the story. But

the proposal to reduce the Sinking Fund by no less than 4,500,000_l._ is

startling enough to compel attention.

The condition of the National Debt was in 1886 peculiar. When Sir

Stafford Northcote, as Chancellor of the Exchequer, in 1875 reorganised

the service of the debt, he had, in order to make ‘steady and continuous

efforts for its reduction,’ assigned a fixed annual sum of

28,000,000_l._, covering both interest and Sinking Fund, and payable,

unless Parliament should in the meantime otherwise determine, as long as

any debt remained outstanding. On March 31, 1875, the National Debt

amounted to 769,000,000_l._; and if Sir Stafford Northcote’s scheme as

it stood on the statute book had remained unaltered, if no war or other

disturbing element had intervened, this debt, without any addition to

the yearly charge of 28,000,000_l._, would have been entirely paid off

about the year 1930. This was the arrangement which Lord Randolph now

proposed to revise, and it therefore requires closer examination. The

full charge of 28,000,000_l._ came into operation in 1877-8. It was

divided between interest and Sinking Fund. At the outset the proportion

assignable to interest and management was between 23,000,000_l._ and

24,000,000_l._, and the proportion assignable to Sinking Fund between

4,000,000_l._ and 5,000,000_l._; but this proportion steadily changed by

the automatic working of the scheme. Year by year as the debt capital

was reduced by the amount of successive Sinking Funds, that part of the

28,000,000_l._ required for interest diminished, and that part available

for Sinking Fund proportionately increased. According to the moderate

computations of Sir Stafford Northcote when presenting his scheme to the

House, 230,000,000_l._ of the debt would have been paid off by the

present year--1904-5. In that case the capital of the debt would now

stand at about 540,000,000_l._, the interest proportion of the

28,000,000_l._ would amount to sixteen and a half millions, and the

Sinking Fund proportion to about eleven and a half millions. Thus the

scheme, which in the beginning imposed a charge on the taxpayer

equivalent to 2½_d._ in the 1_l._ for the purposes of a Sinking Fund,

automatically progressed until that burden would have become equivalent

to 5_d._ in the 1_l._ at the present time, and rising further to 1_s._

or more in the 1_l._ before it reached its consummation. While already

himself attaining a high degree of financial virtue, Sir Stafford

Northcote indicated to his successors a standard three and four and five

times as exalted.

Each generation, almost each decade, claims its right to revise its

standards; and as the rate of human improvement was less rapid than the

growth of Sir Stafford Northcote’s Sinking Fund, it had in 1886 become

clear that the public would not acquiesce in the logical result of the

1875 scheme, or regard as a sacred obligation the exact fulfilment of a

plan which, snowball fashion, rolled on with ever-accumulating weight

and ended by requiring the exaction from the taxpayer during a small

number of years of an amount in repayment of debt which sound reasoning

could not justify. Already the scheme itself had yielded to the pressure

of a passing emergency. Mr. Childers had suspended the Sinking Fund in

great part during the Egyptian War and the Russian panic of 1885-6; Sir

William Harcourt had permitted a smaller suspension in 1886-7. Indeed,

Sir Stafford Northcote seems to have felt that his scheme could not be

maintained in its fulness to the end, and that when the Sinking Fund had

risen to a certain figure, the taxpayer of the day would claim to share

with it the benefit resulting from the progressive diminution in the

interest of the debt. If, then, it were conceded that the Northcote

Sinking Fund could not be maintained in its entirety till 1930, the

revision of the scheme became simply a question of the manner, the

measure and the tune.

These considerations were strengthened by another set of arguments. In

1887 the funded debt amounted to 637,000,000_l._ A large part of this

debt--probably 150,000,000_l._--was held by public departments; another

large part was held by banks, insurance companies and by trustees. It

was computed later by skilled authorities that the holdings on this

account were not less than 200,000,000_l._ As these holdings were

practically not offered on the market for sale, the field for purchases

of stock was comparatively narrow. If a large amount of Sinking Fund

were applied to purchases of stock in this narrow field, the prices of

Consols would be quickly and unnaturally inflated. This condition was

actually reached in later years, when the public credit was so esteemed

that the State enjoyed the privilege of paying 113_l._ to redeem 100_l._

of its own debt.

Lord Randolph decided that the time had come for a revision of the

Northcote scheme. He found himself possessed of a lever capable of

exerting on one occasion--and on one occasion only--a giant’s power. He

was anxious that it should be made the instrument of great and

substantial reform, and not wasted gradually for the sake of convenience

or popularity. For the purposes, therefore, of effecting a reduction and

a general readjustment of taxation and as an integral part of his Budget

scheme, Lord Randolph proposed to reduce the total immediate charge of

the debt from 28,878,000_l._ to 24,417,000_l._, thus effecting a saving

of 4,461,000_l._, or, roughly, four and a half millions. The Northcote

Sinking Fund would thus have been reduced by two-thirds to 2,160,000_l._

The reduction of such a great weapon of financial reserve as the Sinking

Fund has proved in tunes of warlike emergency was practically replaced

by the gain in expansive power supplied by an income-tax as low as

5_d._ The positive economy on naval and military estimates clears the

Chancellor of the Exchequer from any charge of laxity or indulgence. His

judgment on the main question of revision was ratified within two years

by the high and severe financial authority of Lord Goschen, and was

further confirmed eleven years later by Sir Michael Hicks-Beach. The

former reduced the fixed charge from 28,000,000_l._ to 25,000,000_l._;

the latter reduced it again from 25,000,000_l._ to 23,000,000_l._, at

which figure it stood when the South African War broke out. But these

reductions, aggregating 5,000,000_l._ a year, were enforced, the one for

the purpose merely of affording a petty relief to the taxpayer of the

year, and the other to find ways and means for the growing expenditure

of a Government, and not, as Lord Randolph had designed, for the sake of

a large and harmonious reform.

By these methods, however they may be regarded, the Chancellor of the

Exchequer would have become possessed of a surplus of noble proportions.

And the distribution of the 12,500,000_l._ which he had secured is the

coping-stone of the whole financial scheme. Tea and tobacco are familiar

friends to the students of Budgets. Year after year their fortunes

fluctuate in sympathy with those of the nation. In the year 1886-7 tea

was taxed 6_d._ in the pound and yielded 4,514,874_l._ A reduction of

2_d._ upon tea is a generous boon to every poor household. The tiny

packet is a farthing cheaper. The careful spoonfuls may be more freely

bestowed; and the relief is gratefully acknowledged by an immediate

increase in consumption. Lord Randolph had estimated that his reduction

would cost the revenue 1,400,000_l._; but this seems to have been an

over-estimate, for when Mr. Goschen four years later was able to make

this desirable change the loss to the revenue was only 1,100,000_l._,

owing to the greater indulgence of the people.

Who is there, of those who pay it, that will not look back with envy

from these days of 1_s._ income tax, almost as a permanent charge in

times of peace, to times when a tax of 8_d._ was regarded as abnormally

high; when one Chancellor of the Exchequer was resolved to reduce it to

5_d._, and when his successor (Mr. Goschen) declared that, except for

purposes of war, 6_d._ was a proper limit? Of all Lord Randolph’s

proposals none, it may be safely said, would have been greeted with more

general approval than his intended reduction of the income-tax from

8_d._ to 5_d._ At that time incomes below 150_l._ a year were exempt,

but incomes of 150_l_. and less than 400_l._ were allowed an abatement

of 120_l._ Incomes of and above 400_l._ a year had to pay on the full

amount. Official statistics have always been silent as to the total

number of income tax payers, it being apparently impossible to frame a

trustworthy estimate. It is nevertheless probable that the bulk of

persons who are called upon to pay this impost are included in the

150_l._-400_l._ class. It was to this considerable class, composed

mainly of persons emerging into an independence they have earned for

themselves, and rising by their own industry from the level of

exemption to that of income-tax-paying means, that Lord Randolph’s

sympathies were directed. The small householder, pinched by having to

pay in the early days of January the landlord’s tax under Schedule A,

which he cannot recover till he pays his rent at the end of March; the

petty tradesman or struggling professional man who defends a precarious

respectability by a systematic thrift too often unknown to the burly

wage-earner; these are the special beneficiaries from such a reduction,

and they share in a peculiar degree in the general expansion of comfort

and energy which must follow when five millions of money are surrendered

by the State and left to fructify in the pockets of the people.

The largest claim upon the surplus was in respect of Local Government.

Lord Randolph proposed to assign the revenue received from a large

number of Excise licence duties to the various local authorities about

to be established. As it was undesirable to saddle the new-born

authorities with the difficulty and expense of collecting many duties

for which they possessed no adequate machinery, he arranged that a large

number were still to be collected by the State, and the proceeds, less

the cost of collection, were to be afterwards transferred. Dogs, guns,

game, carriages, servants, armorial bearings, auctioneers, hawkers,

patent medicine vendors, plate dealers, refreshment houses, pawnbrokers,

tobacco and sweets dealers, beer, wine and spirit dealers, and the new

tax on horses, aggregating in all 2,700,000_l._, were to be thus for

the time being reserved. But all licences which the local bodies could

collect without any additional cost or trouble were to be handed over at

once. 1,544,000_l._ worth of liquor licences fell into this latter

class. They were to be granted, as heretofore, only on the production of

a magisterial consent, and nothing was simpler than to make the paying

of the duty and the obtaining of the consent simultaneous. Lord

Randolph’s schemes on this point travelled beyond both the Budget and

the Local Government Bill, and embraced local option in the drink

traffic. He believed that the liquor laws ought to be intimately

connected with Local Government. He wished to entrust local authorities

with very large powers to regulate the sale of liquor in their

districts; and he thought that if the revenue which arose from liquor

licences was made an important source of revenue for the local

authority, a salutary check would be provided against hasty or fanatical

action, leading perhaps upon a popular impulse to total prohibition, and

upon the rebound to an unrestricted sale. ‘When you are legislating,’ he

said a year later at Sunderland (October 27, 1887), ‘about subjects

which interest human beings, it is just as well not to leave altogether

out of account human nature.’ The transfer by different methods of these

sources of revenue, together with the contribution of 800,000_l._ in aid

of the indoor poor, provided the round sum of 5,000,000_l._ as the

foundation upon which Local Government was to be erected.

The preparation of such a Budget required an extraordinary exertion.

Scheme after scheme was formulated, only to break down in discussion and

to be dismissed. Many days--wrested by an effort from other pressing

occupations--were consumed in study and reflection. But at length all

was in order and the plan was in detail settled and complete. In every

respect--in the definite economy, in the reduction in the expenditure on

armaments, in the increase in the proportion of direct taxation, in the

immense diminution of public burdens, in the enormous simplification of

the death duties and the introduction of a logical system of graduation,

in the ample provision for the needs of Local Government--it was a

democratic Budget. Yet it was cunningly contrived. The importance and

cohesion of the scheme would have secured it a momentum of its own.

Objections upon detail could at every point have been answered by

general principles. The low income-tax balanced the diminished Sinking

Fund. The economies in public charges justified the remissions of

taxation. The tremendous appeal to the middle classes of a 5_d._

income-tax would have provided the driving power needed from within the

Conservative party. Nevertheless, it was in a grave and nervous mood

that the young Chancellor introduced it to the Cabinet in the early days

of December. He spoke long and earnestly. He exerted all his power of

luminous and attractive exposition. The whole proposal was unfolded. His

colleagues seemed for the moment fascinated. Objections and doubts were

silenced together. No one cared to assail in detail a scheme all parts

of which hung so closely together and which, in the mass, displayed such

novel and spacious outlines. Even Lord Iddesleigh, the creator of the

threatened Sinking Fund, consented to its dissolution for the sake of

the integrity of the scheme. Lord Randolph had come prepared for an

uncertain and protracted battle. He seemed to have won the victory at a

single charge.

His friends at the Treasury waited anxiously for his return. Startled as

they had been by some of his views, foreign to their traditions as was

his treatment of the debt, they had been drawn into the momentum of what

was, after all, a great design. They were prompt to offer their

congratulations upon the Cabinet acquiescence. But Lord Randolph was far

from confident. The silence of his colleagues oppressed him. ‘They said

nothing,’ he told Lord Welby, ‘nothing at all; but you should have seen

their faces!’ He proceeded to give instructions for checking every

figure and recasting every calculation from the beginning, as if he

apprehended some tardy attack, against which preparations should be

made. This arranged, as was his habit he pushed the whole matter from

his mind. ‘There,’ he said grandly to Sir Algernon West later in the

day, ‘are the materials of our Budget. They are unpolished gems; put the

facets on them as well as you can; but do not speak to me on the subject

again until the end of the financial year.’

CHAPTER XVI

RESIGNATION

Happy the man, and happy he alone,

He who can call to-day his own--

He who, secure within, can say:

‘To-morrow do thy worst, for I have lived to-day.

Come fair or foul, or rain, or shine,

The joys I have possessed, in spite of fate, are mine.

Not Heaven itself over the past hath power;

But what has been has been, and I have had my hour.’

_Lines from Dryden copied out by Lord Randolph

Churchill about 1891._

On the morning of December 23 all who took an interest in politics--and

in those days these were a very great number--were startled to read in

the _Times_ newspaper that Lord Randolph Churchill had resigned the

offices of Chancellor of the Exchequer and Leader of the House of

Commons and had retired altogether from the Government. As the news was

telegraphed abroad, it became everywhere the chief subject of rumour and

discussion, and Cabinet Ministers--dispersed on their holidays--hurried

back to London to find out the truth of the matter and to prepare for

the changes that must follow. To the political world the event came as a

complete surprise. No important issue had arisen in foreign or domestic

affairs; no great question likely to lead to such a breach was before

the country; there had been hardly a whisper of Cabinet dissension. But

if the reader has followed this account with any considerable measure of

agreement or sympathy, he will see in this resignation no inexplicable

mystery, no deep-laid intrigue, no explosion of temper; but the logical

and inevitable consequence of all that had gone before.