NEWMAN ON THE NATIONAL DEBT. * THIS tract is entitled to
more notice than pamphlets usually receive, not only for its literary merits, but for the precise logic and lofty tone with which it advocates doctrines respecting the National Debt that if ad- * On the Constitutional and Moral Right or Wrong of our National Debt. By Fron- ds W. Newman, formerly Fellow of Betel College, Oxford. Published by Taylor, Walton, and Moberly. vanced in an impudent manner and a vulgar style would have been scouted as downright dishonesty and " Yankee Repudiation." The Constitution- al and Moral Right or Wrong of the National Debt is an addition to the instances which meet the eye in various directions, of men with unquestionable integrity, high aspirations, and great acquirements, boldly breaking loose from old conventional opinions, as well in religion as in politics and social ethics. A time, it is to be suspected, is coming, when something more than "institutions" will be " put upon trial ": and that trial cannot be staved off by trite rhetoric, official routine, or the sheer abase of party disputants.
The arguments of Mr. Newman are logical if confined within them- selves ; but we look upon: his arguments as of far less consequence than the fact of his producing and publishing them. There are many things in life where argument avails little. It is not argument that induces men to marry, or to fight a duel, or volunteer on a forlorn hope, or oc- cupy a post under which is a mine that they know is going to be sprung : the mass of mankind may be said to be inaccessible to argument. Argu- ment, indeed, in conjunction with circumstances, may form the opinion that induces action; but when the Debt has nothing to depend upon but argument, Funds ought to be below par.
Mr. Newman's fundamental position is a constitutional one,—that an Englishman can only be taxed by his own consent, given through his re- presentatives; that the primary duty of the House of Commons is the superintendence of taxation ; that when it neglects this duty, it not only abrogates its function, but runs counter to the first principle of its exist- ence; and that when it proceeds so far as to tax posterity in perpetuity, or even the next generation, it does what it has no right to do, and its acts are not binding.
"At the present day, there is no less disputed or disputable fact than the ex- clusive responsibility of that House to vote the public taxes from year to year. This is its indefeasible and inalienable inheritance and function, so long as the laws, rights, and constitution of England stand; so long as King, (or Queen,) Lords, and Commons, are venerated. To preserve this right intact for its suc- cessors, may almost be called the primary constitutional duty of the Lower House.
" If an English House of Commons could do anything so traitorous as to pass a bill for vesting in the Crown or the Ministers—either for ever, or only during the next session of Parliament—the right of national taxation, such a bill would be a gross and indefensible usurpation, and overthrowing of the fundamental law of the land, which, while it bids Parliament to exist, defines also the functions of Parliament. Every House of Commons is appointed to definite duties during its own term of existence; but as it is not self-originated, nor self-invested with power, so neither can it forbid successors to arise, or divest them of their legiti- mate powers. If the constitutional rights of future Parliaments are to be lessened, it must be by an extraordinary national settlement, not by an ordinary process of intra-parliamentary legislation. Accordingly, it would be resented as an extra- vagant usurpation, if the Parliament of 18.50 were to enact a complete schedule of the taxes which shall be levied in the year 1870. This would be as truly a violence to the constitution as if the Lords or the Queen were to vote the taxes instead of the Commons: and in fact, it might be used as successfully for des- potic purposes. The laudable desire of consulting the personal dignity and do- mestic independence of one Sovereigns, has indeed led Parliament to infringe the strict limit of its power so far as to settle the Civil List prospectively during an entire reign ; but even this would be extremely dangerous, if a totally new spirit had not come into our Sovereigns since the House of Stuart was discarded. • • * "So much the more amazing is it that any Minister under such a constitution should ever have undertaken to mortgage for present uses the incomings from perpetual future taxation. He who asks a loan, cannot offer as security some- thing which is not in his right or possession. If a British Chancellor of the Ex- chequer, on contracting a loan, were to guarantee repayment from a tax on the province of New York, it cannot be doubted that the Government of the United States would resent it, as a direct claim on our part to the sovereignty of New York. No less distinctly, if the same Chancellor proclaim—' Whosoever will pay me down a thousand pounds in the year 1850, shall receive forty pounds every year for ever out of the taxes which shall be henceforward voted, as, m particular, in the year 1860 "—will he be assuming for himself, and taking away from the Parliament of 1860 the authority to tax or not to tax in that year? Nor does it avail to say that the Minister did it by the advice of Parliament ; for as no ex- isting House can deprive its successors of indefeasible rights, the House will be committing usurpation as much as the Minister. "It cannot be denied that one extreme case would justify such a 'stretch of power; viz. if the State were driven to choose whether the present Parliament or some foreign invader should preoccupy our constitutional rights. To save the permanent rights of our successors, some temporary encroachment on those liberties may be allowed. If the kingdom is assailed by formidable enemies who threaten its subversion—if the means of repelling them cannot be raised by any immediate taxation—if present supr.e are required, which can only be had from abroad—if the lenders are not contented without a guarantee of longer payments than can fall within the few years of the existing Parliament—the combination of extraordinary and overwhelming difficulties might justify some usurpation. But in applying this concession, every link in the chain of alleged necessity must be rigidly proved. The necessity must be real, urgent; nntractable to ordinary measures. Au extraordinary process should be used,—such as specially consult- ing the Lords,—in order to mark clearly that the Commons does not affect to be acting ;within its ordinary constitutional rights, as also to fence it off from the slippery incline of usurpation : and after the crisis is passed, a bill of indem- nity oaght to be asked of every future Parliament, through as many years as the encroachment touches. If, however, in result it appears that this illegitimate fore- stalling of rights was ventured, not for home safety, but for foreign schemes—not in actual need or with actual gain, but for future and cloudy hope—or tithe peon- niary means might have been had by immediate taxation,—and(what nearly amounts to proof of this) ifthe loan was not advanced from abroad, but (whoever was the nominal contractor) was ultimately taken up by English subjects—or, again, if by mere economizing the existing revenue, resources might have been had with- out borrowing,—it is manifest that a wholly needless and therefore an utterly in- defensible usurpation has been perpetrated, for which the Minister deserves to be called to severe account.
" But even if all the links of argument are sound, and we are forced to advise a breach of the constitution, this will not suffice to justify any or every breach."
Logically the argument is sound enough, and the abstract principle of the exceptional case is true enough, which Mr. Newman alone admits to justify a debt. Both are too strict for practice. In war, we must do what we can ; a "foreign invader" must be expelled, how we can. Men wisely part with a limb to save life, although the bad condition of the limb may have been caused by their own folly. The constitutional axiom is truly stated ; but it originated in a dread that the Crown and its Ministers might apply the taxes levied to purposes of tyranny, cor- ruption, or waste. As regards the Debt, this fear can have no place
after it has once been created. In its original contract there might be (as there generally was) corruption, and the money borrowed was often expended lavishly; but the danger was not from the Crown and the Nobles. It may also be observed that a very constitutional spirit prompted the creation. Our ancestors revolted and fought to avoid taxes; their successors borrow.
But, without a joke, there is something higher and better in life than law and logic. Permanence and security are the main elements of na- tional existence; and if Mr. Newman's low Radical argument, loftily re- vived, is to be pushed as far as it will go, there will not be much of either. Honour, character, and public faith, are matters to be struggled for, even at the expense of inconvenience or pressure. Necessity, in- deed, has no law, and not much sense of anything; and necessity at some time or other may induce a national bankruptcy: but it will be the growing poverty of the country that will render arguments for this bank- ruptcy palatable, not the arguments that will induce the bankruptcy. Mr. Newman, indeed, does not argue in favour of actual repudiation. It is his professed object to guard against it by sounding an alarm in time.
" The case then stands thus. We have a PRIMARY duty of justice towards coming times, to leave off the usurpation of their rights: we have a SECONDARY duty of equity and expediency towards the public creditor, to pay him, if we can, twenty ah6lings in thepound. Of these two duties, the first is to be performed at any rate; the second, so far as possible without violation of other equities. If it be really impossible, then, on every moral ground, we are clear from fault in paying a percentage only of the Debt, and so terminating it. We may, however, treat it as perfectly certain, that those who now cry out that greater economy cannot be attained, and will hear of nothing but perpetual dividends,—if a new Parliament were to vote that constitutional right demands a termination of all payments for debt within thirty years' time at farthest,'—fhese same men would quickly discover with Mr. Cobden, that ten millions a year can be saved out of our present expenditure, and that nine of these millions should be added to the yearly dividends, so as to pay off the whole debt in thirty years. To fix sixty years (or twogenerations) for the limit of time, seems to me to be straining our rights over posterity to the utmost; for to dictate to a third generation is mon- strous.
" Nothing but necessity could have justified our predecessors in leaving us this Debt; jet no necessity existed. Nothing but necessity can now justify us in transmitting it to our successors; yet no necessity exists. It is not necessity, but pride, ambition, desire of patronage, or sinister private interest, which keeps up the vast expenses of our Colonial empire, and our Army and Navy. * •
" The way to proceed in Parliament seems manifest, viz. to press forwards a vote, that no payments can be guaranteed for the Debt after a fixed day,—say, after January 1st 1880; leaving the Ministry to find out by what subsidiary measures they may then best reconcile the interests and the rights of the tax- payer and the public creditor. Of course such a vote cannot be carried until there is force sufficient to displace one Ministry and seat another; but a very small energetic minority, by wielding at the same time a declaratory law, such as was above imagined, that no Parliament has constitutional power to dictate to its successors concerning the taxes to be levied, &c.,' would excite so much uneasi- ness and alarm in Whigs or Tories, that it would before long be taken up as a Ministerial measure. So great is the force of simple truth. " Before sounder principle can become victorious, another useful enactment might at once obtain favour with a generation that is accustomed to forestal- ment& About one-half of the Terminable Annuities will expire in 1860, and the rest will rapidly follow. May we not assume that a large majority in Parliament would assent to a prospective bill, enacting that the annual two, three, four mil- lions, which will thus accrue to the Exchequer, should not be remitted to the pub- lic, but applied to convert a new portion of the Debt into a terminable form? If we wait till 1860, there will be far greater unwillingness than now to pass such a bill At present to propose it needs little boldness; it will entaillittle loss of larity with the mass of the unthinking ; and, if brought forward by an un- official person, is not likely to meet strenuous Ministerial opposition."
This proposal is a type of Mr. Newman's mind ; which looks at logical theory rather than at what is practically wanted or attainable. It is not acts of Parliament that we want, but a resolute principle of action. If opi- nion remained as careless about the matter as it is now, the law of 1850 would be abrogated in 1860, as analogous laws have been before. In fact, it is in the fillip this pamphlet may give to public opinion on the subject of the Debt that its utility consists; not in its argument upon the "right or wrong," or in the author's Parliamentary and financial suggestions. Any unbiassed observer of public affairs will cheerfully go along with all Mr. Newman says on the profligacy shown by Ministers and Parliaments in con- tracting the Debt, and the apathy, to use the mildest term, exhibited by the people. They may even go beyond him. In times of war, especially against such opponents as Louis the Fourteenth, the Committee of Public Safety, and Napoleon Bonaparte, men act under a pressing necessity, which urges them to do what they can, not what they would. Under the Tory Governments, after the Peace some reduction was made in both the capital and interest of the Debt, by reducing the dividends on the Five and Four per Cents, and by keeping up for a short time an actual sinking-fund of three millions. During Peel's last Ministry, a large saving was made in interest by the redaction of the Three-and-a-half per Cents, and a trifling action on the principal by means of the sinking- fund available from his large surplus revenue. The Reformed Parliaments, the Reform and Whig Ministries, have been permitted to add more to the Debt than was added by the wars and victories of Marlborough, with little opposition, and nothing like a distinct protest against the principle of their conduct. Parliament quietly voted, at Ministerial bidding, twenty millions for Negro Emancipation—and we all know what has come of that ; it gave a million to the Irish parsons ; it saddled the country with the guarantee of the " Greek Loan," which will most pro- bably turn out a couple of millions more. The other day it recklessly voted ten millions for Irish distress, which morally was aggravated by the money, and which economically speaking was not in the long run re- lieved. The precise amount added to the Debt from that deficiency of income over expenditure which year after year has accompanied Whig management of the finances, is difficult to tell, owing to a juggle with the Savings Banks and the absence of distinct record : it cannot be much less than ten millions, it is probably more. Thus we have an addition of upwards of forty millions to the National Debt during some fifteen years of Whig rule; for it is a remarkable fact that when the Whigs have been out of office the Debt has been diminished. What renders this apathy to financial incapacity and the increase of the Public Debt more remarkable is, that the case is not so hopeless as it might seem. The payments on account of the whole " Debt " for the year 1848 were about twenty-eight millions and a half ; but of this nearly one-sixth was not permanent. The Perpetual Annuities were somewhat less than twenty-four millions ; the interest on Exchequer Bills, 790,000/4 the Terminable and Life Annuities, which drop at a fixed date, or with the lives on which they are granted, about 3,800,0001. The Ex- chequer Bills are as much a debt as any other, but they are as different as a business bill and a mortgage ; nor can they altogether be dispensed with. In the course of twenty years, the annual charge on account of the Debt would be reduced to about twenty-four millions, if it were let alone, exclusive of any decrease by reduction of the interest, or purchases of Stock from the surplus revenue. Every year, too, a self-acting pro. cess is going on to a varying but considerable amount. Any individual may convert his permanent Stock into an annuity on his own (or any- body's life, the converter receiving a larger annual income, which ceases altogether when the "life drops." And as Government offers advantages and security beyond private companies, a good trade is done in this way. There is of course no hocus-pocus saving by this mode : the Debt is diminished by means of a larger annual payment for a time; but the principle is self-acting, and the weight unfelt, as the annual savings from dropped lives about balance the additions. If Mr. Cobden and the country will add a sinking-fund of one, two, or three millions a year, so much the better : the Debt would be brought down more quickly. But it is obvious, that if incapable placemen are permitted to meet their difficulties by " drawing " on the public credit, the Debt will increase much faster than Death and Time can diminish it.
It is on this ground that we chiefly attach importance to Mr. New- man's pamphlet. If his startling doctrines and powerful style should rouse the attention of the public, and compel attention to Parliamentary and Ministerial dealings with the Debt, he will have done the public a service. If not, it is probable that some gloomy morning his conclusions may be carried out, whatever may be thought of his majors and minors.
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