TOPICS OF THE DAY.

MYSTIFICATIONS IN FINANCE.

TEE Manchester Guardian, a Whig-Ministerial journal of some consequence in the district where it circulates, has published a notice of our late Supplement on the Import-Duties, with its accompanying topic, " Official Suggestions on Taxes and Trade,' and pays us a civility at starting. This strain, however, soon ceases, and the Whig partisan turns to his vocation, charging us with the high crime of endeavouring to bring the Reform Ministry and the Reformed Parliament into contempt by false and malignant libels. The charge in itself would not be worth much notice, but as it indirectly embraces the Whig dealings with our finances, on the eve of a session which ought to have much to do with finance, we may go at length into the three chief counts of this Manchester indictment.

1. The first count declares our assertion, that what " was done in the way of willingly repealing taxes was done while the Whig Ministry was warm in office, and before the passing of the Reform Bill," untrue : our accuser controverts the fact by re- ferring generally to the amount of taxes repealed in 1833 and the following years. Now we never denied that taxes were repealed ; we said willingly. One of the most popular, and, in the way of direct relief to the class touched, the most effective repeals, was the House-tax. But was this done willingly ? When the Whig protege and baronet Sir Jonx KEY brought forward his motion for the abolition of the House-tax, Lord ALTHORP opposed it with all his might, and was beaten. The " honest " man immediately talked of resignation, or a Property-tax ; and in a day or two came down and made the House of Commons eat its own words, and rescind its recorded resolution : nor was it till the town populations were up in arms, and resistance became impos- sible, that the House-tax was repealed. Smaller in amount, but worse in principle, and more important in results, were the Taxes on Knowledge. But were these modified willingly P Was not their modification resisted session after session, and only yielded at last to the squeezing process ? The greatest and most beneficial finance measure of a single kind ever effected, was Postage Reform : no one can deny that this was obtained under a Whig Ministry, but who could assert that they granted it willingly ? 2. The Guardian states, that the Spectator's " serious appre- hensions as to the contraction of a loan, or the imposition of further taxes, we rather opine, be will have the exclusive enjoyment of." Possibly, till the loan be advertised, or the taxes brought forward ; for we are not unaccustomed to the "exclusive enjoy- ment" of an opinion till it is borne out by events. In this case, however, we do not happen to stand alone. On the same day that the Manchester Guardian was putting forth this sneer, the Standard was declaring that the British tax-paying power had lost its elas- ticity, and taking the alternative we offered, of a revision of our Cus- tom-duties, or a Property-tax " every thing taxable," says the Tory journal, " except realized property, is already taxed, and, as appears from the returns of the year, taxed to its fair maximum" : and the Standard goes on to suggest a Property-tax. But facts are better than opinions ; and facts we will adduce.

The public expenditure under official control can never be truly

got at, especially for limited periods ; partly from the official plan of book-keeping ; partly from an intentional or accidental system of mystifying; and partly from the nature of the case— the Army, Navy, Ordnance, and Commissariat operations being scattered over the world, and taking a long time to wind up. The Finance Accounts, though not the nearest in point of actual expen- diture, being only based on money paid, furnish sufficient data to show that our "apprehensions" were not based on air.

In 1837, the "excess of expenditure over the income " was £655,760*

In 1838, the excess of expenditure was 345,227t In 1839, this excess of expenditure had swollen to 1,512,792:

The Accounts for 1840 are not yet published, or indeed made up ; and the only document we have access to is the return of the Commissioners for the Reduction of the National Debt for the year ending 10th October 1840. This return includes the-last quarter of 1839; but, assuming the ordi- nary expenditure of the last quarter of 1840 to be the same

as that of the preceding year, we have an excess of 1,560,640 £4,074,419

Here we have a gradually growing deficiency reaching to more than four millions, with nothing for the Foreign expenses of the Chinese war—nothing for those of Syria. Were we not justified, then, in the "apprehension" that, if we "are to go on this way, we must either have a loan or new taxes"? If the man of Man- chester, in such straits, can do without either payment or borrow- ing—either cash or credit, he is the cleverest fellow in finance that has yet appeared.

3. The other count of the indictment states that it is " calum- nious and untrue" to say that the Whigs have added to the Debt-

" The Spectator well knows, that this statement is calumnious and untrue; and that, including that portion of the Debt, the redemption of which has been actually provided for by its conversion into Terminable Annuities, the sum of which has been increased from an annual charge of' 2,859,269/ in 1831, to one of 4,271,4584 in 1839, the Whigs have not only not added to, but they have largely diminished the Debt. He knows also, that the 20,000,0001. actually paid as the price of Negro Emancipation far more than accounts for all the apparent increase in the Debt which has taken place."

This is bold and general: we might meet it in a similar way, with

• Finance Accounts for the year ended 5th January 1838 ; page 14. Ditto .. 1839 ; page 19.

; Ditto 1840 ; page 14. 'Life Annuities" expired during Whig rule 4E469,018

a contradiction—and perhaps our word would carry as much weight as the Manchester Guardian's. But we prefer the more specific mode of facts and authorities ; and, following this course, we observe, that at the close of 1830, the interest due to the public creditor on the Funded Debt was 27,399,5754* which had increased by the end of 1839 to 28,588,9611. ;t being an increase of 1,189,3861. of annual charge. But this is not all. The first step towards an addition to the Debt is an increase of Exche- quer Bills, which excite no attention—which can be sent out by driblets, hand to mouth fashion, and bear a lower rate of interest. The interest on Exchequer Bills for 1830 was 793,0311.4 for 1839 it was 856,7011.;§ although in that very year no less an amount than four millions of Exchequer Bills were added to the Perma- nent Debt, forming an addition of 4,396,4581. to the Three per Cents.II Nor is even this all. Annuitants, though they proverbially live long, do not live for ever ; and public annuities to the amount of nearly one million a year had expired up to the 5th January 1840. how much of this sum fell in during the Whig rule we have not the means of telling with accuracy, but on the head of " Life Annuities" alone nearly half a million has dropped since 1830;¶ which the Whigs have silently filled up with new lives, and their friends pass it off to the world as a reduction of debt ! The whole account, therefore, stands thus— Increase of annual interest on the Funded Debt in 1839, as compared with the annual interest in 1830 £1,189,386

Increase on Exchequer Bills in the same period 63,730 "Life Annuities" expired between the close of the years 1830 and 1899 469,018 Other classes of annuities Unknown.

Gross increase of the annual interest on the National Debt

between 1830 and 1839, so far as known £1,722,134 DEDUCT

The loan for Negro Emancipation, (though clearly a Whig

addition,) 20 millions at 3* to 3i per cent. per annum, say 042,134 Real increase of annual interest on the National Debt between 1830 and 1839, after deducting the Emancipation loan .61,080,000 The Manchester Guardian would imply, that this addition is only seeming ; permanent debt having been converted into terminable annuities at a higher rate of interest. We know that the Debt has not been increased by this amount ; (for that would have involved an addition of thirty millions of capital beyond the Emancipation loan) ; as we also know that the Whigs have had no means of " largely diminishing " debt,—having begun their career with causing a deficiency in the public income, and having rarely had a surplus of any amount, whilst they have wasted a million on Irish parsons, squandered large sums on Shannon jobs, &c., and for four years past have had an excess of expenditure over income. But Terminable Annuities are tender things to touch. Did the Manchester financier ever hear of Mr. Faint and Mr. Actuary FENLAISON ? We ask the question, because it was said Mr. FARE had demonstrated that the Actuary, by tak- ing average lives as the basis of his calculation, whilst the capital- ists, who actually traded upon his mistakes, selected choice lives, the conversions of the Permanent Debt into Annuities were effected upon terms so unfavourable to the public, that any joint-stock esta- blishment, however rich, must have been utterly ruined by the practice. For Mr. Firmarsores original blunder the Whigs are not responsible, but they are responsible for its continuance. If it furnished them, however, with a ready means of seeming " largely to diminish debt," by filling up the lives of dead men, who can wonder at their quiescence ? Yet, what would be thought of an agent in private life, who should pretend to reduce his employer's debts by turning his long responsibilities into shorter ones bearing a higher interest, at a ratio of conversion much too great ; filling up the old lives as fast as they dropped, to cloak his own expenditure ; and then abusing those who would not allow this process to be " diminishing debt " ?

The impression from the facts we have adduced will be that of an increase of Debt. An exact statement of this increase is not so easy to present, partly from the nature of the subject, partly from its mystification. To send the reader to the Finance Accounts would only involve him in a mass of unintelligible figures, not yielding sufficient data after all. It would take an actuary a long time, with access to the original documents, to calculate the true results of all the changes backward and forward. But, leaving the juggle of Terminable Annuities as undeterminable, there are certain points in the matter whence some conclusion may be drawn.

POSITIVE ADDITION TO TIRE CAPITAL OF THE Dare.

1. There can be no kind of doubt, that the four millions £ of Exchequer Bills funded to relieve the overloaded market, by SPIUNG RICE, as the crowning glory of his financial works, was a positive addition to the capital of the Debt, of 4,396,458 POiDDLE INCREASE

OF DEBT.

• Finance Amounts for the year 1830, ended 5th January 1831; page 145. 1839, 1840; page 105.

}Ditto Doto 1830, 1831; page 120. iDi Ito 1839, 1840; page 77.

I Ditto 1839, 1840; page 103. ¶ [He Annuities expired up to 5th January 1840 £772.944 Ditto ditto 1831 303.926

2. Notwithstanding this conversion, the in- terest on Exchequer Bills in 1839 was more, by upwards of 60,000L, than it was in 1830. To convert this additional sum into Three per Cents. would be an increase to the capital of the Debt of

about two millions. Various circum- stances, however, render it impossible to

tell how much of this was a permanent increase ; and the Sinking-fund has had some operation : we will therefore not carry it out as a positive, but as a possible addition, of X2,000,000

5. We have seen that the excess of expenditure over income for 1839 was 1,512,7921., and the excess for

1840, up to the 10th October, was 1,560,6401. In

this amount the last quarter of 1839 is stated twice, but the last quarter of 1840 will not be less than its predecessor. Convert these sums into Stock at 90, and we shall have nearly 3i millions of Consols to be added to the positive Debt, say 3,403,542 Real increase of the Debt between 1830 and the

present time £7,800,000

In addition to this, there will be the " extraordinary" cost of our " glory" in China, and our " glory" in Syria, and the conti- nual expenses of our " armed peace " ; the glory carrying the addi- tional debt up to some ten or twelve millions, the " armed peace" enabling us to increase its amount by a couple of millions or so each year that it lasts. [Let the Tories ponder on the plight that awaits them !] And all this is over and above the twenty millions paid for Negro Emancipation, and the some fourfold tax upon sugar, paid by every one who uses it, in the shape of increased price. Well, Mr. Manchester Guardian, is this, as you say, " largely diminishing," or as we said, " adding to the Debt " ? Who now " has presumed largely on the ignorance of his readers " ? Dismissing the Guardian's finance, let us try a sample of its politics. "After all," says he, with Whig insouciance, "the Reform Act has accomplished, in our judgment, quite as much as was reason- ably to be expected from it." Hear this, ye who grumble at the working of the Reform Bill; and be silent, if not satisfied. The organ of the Whig manufacturing gentlemen tells you that their reason is satisfied with the "accomplishments" of the Reform Act ; and the Tories will soon tell you the same thing. What more can you want than the assurance of " the two great parties" who are born to govern this country?

His closing passage also is worthy of observation-

.. True it is, nothing decisive has yet taken place in reference to the matter, [a revision of the tariff] ; but we are greatly mistaken if now that the embar- rassing Church and Corporation questions are disposed of—to which, and to the recent party-struggles in the House of Commons—struggles not sought by Minis- ters, but in which they had no choice between engaging or retiring from office— it is owing that the House has not yet had leisure for entertaining the matter of a revision of the tariff—some of the questions arising out of or suggested by the inquiries of the Imports Committee of last year, be not brought forward as Government measures. Opposed they will probably be, by a combination of Colonists, Anti-Slavery advocates, and Tories ; but we shall be much mistaken if the votes of Ministers, and those of their steady supporters in Parliament, be not used, with such influence as the Reform Act has left them, in favour of a re- vision, on liberal principles, of the British tariff."

The first point in this paragraph is its coolness. Who forced themselves into office on Church questions, and declared " to God" they would stand by them ; and then abandoned them, without shame or principle, as soon as they had served the turn 7—The Whig Ministry. Who brought forward the " embarrassing" Irish Corporation question ; rung the changes on it session after session, till even the parties practically interested in it were sick of the farce ; and then, after years of " party struggles," submitted to the dictation of the Lords ?—Why, the Whig Ministry. But what was to prevent the Trade and Finance Ministers from planning and bringing forward a revision of the tariff, as a " Government measure," at the first assembling of the Reformed Parliament, and before Corporation questions arose to embarrass anybody ? They may now, as the Guardian intimates, put forth some scheme for a revision of the tariff—small, peddling, and omitting the great item of corn. The point is, if they are " will- ing " workmen, why not have brought it forward when their ma- jority was sure of carrying any such measure ? Why delay it till now, when their majority for any thing is doubtful, and when a mixed question like this will probably leave them in a minority ? The phrase of the Whig journal before us furnishes the answer: they have " no choice between engaging" in some sham " or retiring from office."

The purpose of this intimation is obvious, and cannot be too soon exposed. The independent action of the Anti-Corn-law- League at Walsall—the pinching pressure of prices, operating without respect to politics—the screwing-up effect of the surcharge on the Assessed Taxes—our " apprehension," shared, we fancy, by many, that " a new loan or new taxes" must be come to—and the obvious fears of the Tories, displayed by the Posts assault on the evidence upon the Import-Duties, and the Standard's grave proposal for a Property-tax—all tend to show that Free Trade doctrines arc growing, and that their advocates are gain- ing ground and advancing in practical importance. But, as we asked when we brought forward the " Official Suggestions on Taxes and Trade," where is the man, in the Ministry or elsewhere, who can do this thing ? Of this truth it is pro- bable the Government is also conscious ; and if they could stifle an agitation likely to lead to too strong a pressure, by the pro- mise of a " pear" to be " ripe" hereafter, and to furnish them with a half-measure " for rejection," during the term they are likely to live, they will gladly do it. Let the friends of Free Trade avoid this snare. We do not for a moment any reject Ministerial assistance, or Whig assistance, or any assistance. On the contrary, to apply CHATHAM'S figure, let them spread their sails to every favourable wind, without regarding whence it cometh : but let them not slacken in their own exertions on the notion that the winds will navigate their -vessel, or be tempted to take in canvass, or loiter in port, lest the puffing gods should take offence at the distrust or boisterous acti- vity of the seamen. Propitiate Hercules, gentlemen, as much as you please, but put your own shoulders,to the wheel. The utmost you can hope from Ministers and Parliament, is to shape the measure which agitation shall demand in a voice too powerful to be resisted.

We are perfectly sensible, we again repeat, of the evil of the people assuming the functions of legislation, and turning Parlia- ment into a court of registration for the popular will : but of two evils it is the lesser. Nothing of popular and public importance is gotten from the Reformed Parliament but by force, or fear, or pressure. By these means was gained the repeal of the House- tax and the reduction of the Taxes on Knowledge ; by these means Cheap Postage was gotten, and the final settlement of that cloak for knavery and trap for credulity the Civil List Pensions. But though sluggish for good, they require no stimulus for evil. They wanted no " pressure from without " to pass the extravagant Civil List of Queen VICTORIA, or to give a million of British money to Irish parsons ; no coercion first to neglect the affairs of Canada and China, and then to squander millions in attempts at their set- tlement : nor, though in ample time to have prevented the war in Syria and the risk of a rupture with France, would they even take the trouble to make inquiry, but committed the prosperity .of the country and the peace of Europe to the bands of Lord PALMERSTON, to be dealt with at his pleasure.