TOPICS OF THE DAY.
THE FRENCH LOAN OF TWENTY-FIVE MILLIONS.
THE Budget published on Tuesday by the French Minister of Finance is not, indeed, a War Budget, but it is a war- like one, for two reasons. It has been overweighted by charges mainly incurred to bring the Army into an effective condition, and it adds one more to the many failures which it is now essential for the Emperor to efface. His policy of the last two years has failed at every point, and it is now shown to have been extravagantly wasteful in actual expenditure of cash. Mexico has been abandoned, America alienated, Italy irritated to hatred, North Germany allowed to consolidate itself, an enormous increase demanded to the blood tax, and the whole nation placed under arms merely to preserve it from falling out of its old position in the world, which, never- theless, has declined. These are very great and very visible failures, and now the Imperial Government is compelled to acknowledge that the failures have, in two years, increased French taxation for ever by three-quarters of a million a year of mere dead weight. Cautiously as M. Magne words his statements, this is their sum and substance. The total actual deficit of the year just ended—and by deficit we mean the difference between receipt and expenditure—has been 7,560,0001. sterling, nearly 10 per cent. upon the revenue, a sum which would drive Mr. Gladstone half frantic, and give a shade of annoyance to Mr. Disraeli's more impassive face. The causes of that deficiency have been the orders to rearm, the Mexican retreat, the Roman expedition, and the falling-off in consumption and trade activity produced by the European condition of unrest. Eleven millions sterling more will be required to complete the armaments, to organize the new levies, to provide certain bye-roads, to perfect the reconstruction of the navy, in short, to carry out the Imperial ideas, of which only one can be said to be certainly reproduc- tive. New taxes to meet these outlays would certainly be unpopular, as unpopular as the new conscription ; the floating debt, now thirty millions, cannot safely be increased, and the only resource is a loan, which M. Magne fixes at 17,600,0001. But it will be observed that on any fair reading of his state- ment he wants 440,000,000 francs in cash, not in renter, and as he must borrow this sum at 68, the loan is actually one for 25,000,0001., costing for ever, at 3 per cent., 750,0001. a year, or, as it were, adding a new Civil List to the expenditure of the country. Moreover, France is warned that this amount will not restore an equilibrium in her finances, that " it would be an illusion to suppose that by all this expenditure every- thing would be accomplished." More, it is clear, will be demanded, and more, if the present system lasts, will be voted without resistance, almost without inquiry, as the price which France pays for the blessings involved in personal government and the consequent "safety of society." No compensation to Mexican bondholders, for example, is included in this budget ; yet compensation, it is certain, must be given, and M. Magne hints that the claim is based on " moral considerations," and will be provided for in a separate Act. Frenchmen do not, it is true, think much about finance ; but there are classes of French- men who do, and it is impossible that they should view without alarm a policy which silently adds 10 per cent. to the expenditure of the country, yet involves an almost com- plete abstinence from new taxation.
We do not, of course, mean to say that France is in any immediate financial danger. It is not. We question if the real wealth of France, the annual outturn produced by her extremely intelligent industry, has ever been fairly estimated, either by her own economists or by ours. Her own have been hampered by delusions as to the proportion borne by external commerce to total production, and ours by some inability to understand a distribution of wealth so much wider than that which prevails in England. The incidence of taxation, too, is still badly arranged in France, falling too heavy on agricul- ture, and she has only begun to carry out the principle of Free Trade. With her railways complete and her trade enfran- chised, France could probably bear a taxation of a hundred mill ions a year, and it must be remembered that her debt is still lessthan two-thirds of ours. If the Emperor wasted eight millions a year for twenty more years France would still stagger along, a heavily burdened but still solvent and most formidable power. It is the absence of return for all this expenditure, the waste in the application of all these loans, which is so alarming to observers. Of this present one, for example, scarcely anything is so applied that it will fructify in any way whatever. The reorganization and rearming of the military force may have been necessary, but neither soldiers, nor Chassepots, nor siege artillery produce, or can produce, any sound economic result. They do not in France even relieve the country of a periodic unrest, as our own Volunteers have done. The Mexican expedition has proved a pure loss alike to France, to Mexico, and to the world. The Roman expedition has only added one more to the enemies against whom France must provide. The German policy, it may be conceded, has secured a good for mankind ; but the immense expendi- ture it has entailed has and can as yet produce only soldiers and cannon for France. It is true that, with this expenditure, France has bought an Imperial Government which in many ways and to a very wonderful extent has increased her mate- rial wealth. The cash value of the improvement in her means of communication and the reform in her tariff may be, and pro- bably is, equal to the whole extra cost in cash of the Imperial regime. But then that extra cost need not have been thrown away. Had the Emperor never gone to Mexico, or had he- understood German politics, or had he not carried the Army Bill, he would not have been less strong, but more strong,—the force and unity, and, in some respects, the wisdom of the Imperial Government would have been purchased without this excessive outlay. The suit might have been won without a mort- gage as well as with one, and though the suit may be finan- cially still worth winning, the mortgage is pure, because unnecessary, loss. It is this which comes home to Frenchmen, and which will day by day strengthen the necessity felt by the Emperor to efface by some brilliant deed or some splendid acquisition the recollection of his failures. Of the loan to be raised much has already been spent and more is pledged, and it does not therefore imply immediate war ; but it has been spent and is pledged in order to make war easy, and the neces- sity of raising it must increase the readiness of the master of France to give the final signal.
The irritation of France would be much greater were she ever to awake to the fact that the personal government she is supposed to desire, and the strong government she really desires, may be purchased at very much less cost. The ex- penditure of France in round numbers is not less than 80,000,000/. a year, of which the debt does not yet absorb 16,000,000/. Her administration therefore costs 64,000,000/. The administration of New Prussia, which is in many respects even stronger than that of France, which, like hers, is con- ducted through a scientifically organized bureaucracy, which rests upon equally immense military power, certainly does not cost, under the new regime, including the civil expenses of the dependent States, 32,000,000/., of which the debt consumes 2,000,000/. Speaking roughly, and allowing for a local taxa- tion of which we have no details, it is nearly certain that France is governed at twice the expense of North Germany, an extra- ordinary and to us almost unintelligible fact, which will one day strike the political mind of France. Prussia has been governed for half a century by a personal will and a strong bureaucracy, yet she is at this moment, out of all question, the most econo- mically governed State in Europe. There is nothing in her social condition which would account for the fact, yet which does not exist in France, and we are driven back on the con- clusion that there is waste in France almost as great as in England, a waste intensified by the high-pressure speed and theatric policy of the Imperial regime. Waste makes extra- vagance doubly dangerous, and France once aroused may one day question whether her internal security and external weight, her magnificent army and scientific police could not be pur- chased at less cost to the industry, the commerce, and the savings of the country. For the present all goes well, but an extra ten centimes of taxation cannot be postponed for ever, and an extra ten centimes imposed in the interest of public faith destroyed the Provisional Government.
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