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grounds ; committee after committee is reporting differently on the same character of evidence ; and yet the official " leader , " to whom others look in their non-responsibility or their helplessness , is not only doing nothing , but he appears unconscious that it is not his function to propose system and principle where now there is neither one nor the other . And the difficulty is only beginning , for when the Commissioners have reported ,
with the possibility of only reporting in one way , the disfranchisement begins ; and the already captious tone of the Lords , even in such a case as that , of Canterbury , promises very combative conferences between the two Houses . In fact , we shall be in the middle of general disfranchisement about the time ( early next session ) when a contemporaneous extension of the suffrage is due ; and what a fine spectacle it will be for an enlightened nation to have this sort of " votes" in circulation :
—Monday , orders of the day : 1 . Parliamentary Reform Bill ( Lord John Russell ) , second reading . 2 . Disfranchisement of Hull ( Lord John Russell ) . Friday : 1 . Parliamentary Reform Bill Committee . 2 . Disfranchisement of Liverpool ( Mr . Cardwell ) . Yet that is exactly the catastrophe impending , and for which no one seems preparing ; so that we have only two things to think of Ministers ; either that they are very great blunderers , or they intend to arrange excuses for another year ' s adjustment of the long promised reform of the Reform Bill . But they are developing themselves in unexpected ways ; and we
may make them out better by and bye . They have gone down so much , lately in estimation , although powerfully indirect and in the Lord Robert Grosvenor class of votes , that unless they retrieve themselves by a broad , comprehensive Budget on Monday , their prestige will go . Canada Clergy Reserves Bills , however eloquently and heavily enforced on attention by Mr . Blifil Peel , and Jew Enfranchisement Bills , and Mild Education Bills , however confidently put by the complacent Russell , will not suffice without vigour in riskful matters too ; and on the other hand , " administrative ability , " which is the forte of the coalition , and
which is only manifested in back bureaux , does not balance bad appearances in public , for a bureau is , after all , only a place for a rehearsal . Mr . Disraeli is missing no chance , and Mr . Disraeli is not the only mischievous person who is glad of a fracas for the sake of the noise . There is the Brigade , to which , obviously , we are indebted for carrying Mr . Gibson ' s first resolution , and which holds its power of turning the scales between English factions . Its members are only waiting to conclude with the annoyance of proving their
" qualifications" before Committees , ere they commence their reckless and ruinous assaults on Downing-street . Mr . Serjeant Shee , Attorney-General of the Brigade , has a notice on the paper of a motion to repeal the Ecclesiastical Titles Bill ; and if that apple of discord is once thrown on to the Cabinet council table , the coalition will commence contentions ending , it is not impossible , in the crisis for which Mr . Disraeli is so anxious . So that altogether Ministers will have a good deal to do to get over the consequences of this week . "A Stranger . " Saturday Morning .
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TENDENCIES OF THE N . EW FINANCIAL POLICY . ( From a Correspondent . ) Tun plan of the Chancellor of tho Exchequer , for a change in tho form of part of tho national debt , is now so well known , that , for our present purpose , a very brief description of it will flufIu-0 . At tho pleasure of tho holders , a certain portion of threo per cent , stock may be either redeemed or converted into any of tlip three following forma : —1 st , a Ktock bearing 3 fc per cent , interest , of which Wit . l () s . will be given for each 1 ( K )/ . of tho old stock ; or , Sindly , a Ktock bearing 2 . , per cent , interest , of which 110 L will bo given for ench J . OW . of tho old stock ; or , 3 rdly , Exchequer boiidn , exchanged fo * the old stock , at par of tho capital , transferable by mere delivery , bearing ii : J per cent , interest , possibly up to , but not beyond , 1 KIM ; and 2 £ per cent , up to lH 1 M , with coupons attached . The attendant conditiouH of the conversion wo will advert to , ns
our argument may require . It lins been hIiovvii , that ( hero w little probability of tho conversion taking pluco , to any fjroat extent , in the new . ' {^ per cent , tdock , while tho 2-i in open ; i ' or , while tho former gives an intoro . st of 'If . J 7 . s . i ) il . percent ., on the old capital of 100 / ., with a claim for only 82 / . l () s ., at the end of forty years , tho latter gives an interest of 2 / . 1 ("> . ? . por cent ., very little lend than Mm other , with a claim , at the same period , for 1 . 1 *)/" - ¦ The advantage is too great , nnd too obvious , to permit any doubt us to the result .
Before we proceed , we may express a suspicion that a mistake has been in ruin in the statinnoiit of the terms really intended , and that the new capital wiw meant to hour an intercut of 2 ^ per cotit ; ., not on Uh own amount of 11 (){ ., but on that of the KM )/ , of ' . \ per cent , stock , with which it jh to he purchased ; tlmt is , that tho new tstoclc should bear an interest of about , 2 \ per cent . But , however micli an intention might have comported bettor than the actual proposition , with the general object *) of tho measure , thnro L no trace of it beyond its intrinsic propriety , and wo havo to deal with tho proposition as it hUikIb ,
It was at once objected , that the new 2 £ per cent , stock , most likely of all to be taken , would add 10 per cent , to the capital of the debt . The fact that it did so , for a very inadequate reduction of the current interest , was no more than an aggravation of the main objection , which was directed against any augmentation of the principal whatever . To this , Mr . James Wilson , one of the Secretaries of the Treasury , made two replies , which require examination . The first is , that , in the forty years during which this stock is to be irredeemable , the 5 s . per cent , per annum , saved in the interest , will exactly amount to the 10 ? . added to the capital , besides the comparatively small
effect of compound interest on the annual savings . But , if so , then the process is not a reduction of interest , but a transmutation of interest into capital , and nothing more . The argument would have applied jusfc as well , if any other figures had been chosen for interest and capital , provided only that they fitted each other . Raise the capital to 140 ? ., at the end of forty years , and sink the interest to 2 per cent ., —or , raise it to 2201 ., and abolish the interest altogether and you have the same result . But what then ? Only this : you have augmented the future payment of capital , for the sake of a present relief in interest . The objection is not touched .
As to laying up the 5 s . per cent , per annum in the hands of the Government , in order to provide for the payment of the extra 10 Z ., at the end of forty years , when did ever nation or government pay the slightest respect to the original purpose of such a fund , when once it became convenient to use the accumulation ? A balance in the Exchequer is always the signal for some new expense , or some diminution of taxes . The 5 s . will either be not paid , or it will be spent , and so we come to the old conclusion again , —the capital is increased , that the interest may be diminished ; our successors are to pay more , that we may either pay less , or spend on ourselves what we do pay .
The other answer of Mr . Wilson is , that it is of far greater importance to diminish the interest than the principal , inasmuch as the interest is demandable , but the principal is not . We must pay the interest , but nobody has a claim on us , against our will , for the capital . This view of the question tacitly assumes the perpetual existence of the debt . The national debt has existed so long that we unconsciously look on ifc as an institution , nay more , as an integral part of our corporate existence , a necessity of nature , like air , light , or limbs . We rarely think of it as an evil , and never as an evil whose remedy
lies within our reach . We never consider the harm it does us beyond the mere amount of taxes we pay for the interest on it , which is probably not amongst the greatest of its injurious consequences . That it complicates and falsifies our whole system of taxation ; that it renders the application of sound principles difficult ; that it nourishes the existence of a large class who live -without the salutary cares and hopes of industry or business ; these and other effects of the debt might well stimulate every effort for its diminution , and may at least require that any attempt at present relief by increasing the difficulty of redeeming it , be peremptorily resisted .
Mr . Wilson ' s argument assumes , although it would hardly daro to assert , that we can pay the interest , but cannot discbarge the principal . But on this supposition the plan itself cannot be made to work ; for nobody would accept a diminished interest on an increased capital who really believed that the capital itself would not be paid , The very possibility of carrying into effect the diminution of interest on tho plan proposed , depends on the belief that the old capital debt , with 10 Z . per cent , additional , can and will be discharged . Without this belief there is nothing to induce the acceptance of tho commuted interest . With other points before us to be discussed , of oqual importance and more pressing interest , we cannot now pursue this subject . ltd gravity , however , -will compel us to return to it hereafter .
Tho third alternative offered to holders of the present threo per cents , is that of Treasury Bonds , such as wo have already described them . Tho main feature of this part of the plan is that , as far as it goes , it mobilizes the debt : the consequences of so doing appear not to havo attracted due attention . The commercial crisis of 1825 , and tho measures which followed , supply ample reasons for lookingwith suspicion on a plan which stron g ly tends to reproduce the evils of that time . Our views on this point require some preliminary explanation . Of all the elements of our productive power , labour and most
personal skill are actually the most , plentiful , but the slowly augmented ; while capital applicable to the employment of labour and skill is not so plentiful as fully to employ thorn , but is easily supplemented , and in effect augmented , by erodit , and at times is freely so supplemented . Thftt this is the true state of tho ease is evident from this —that on an extension of credit in any form our products increase inueh more rapidly than labour and skill can be supposed to increase ; there must therefore ! always be n large reserve of laliour and skill ready to be culled into instant action by an accession of working cap ital or its
substitute , credit . Now , along with thin utato of our productive powers , over ready on any accession of floating cap ital , actual or substitutionary , to start into greatly increased activity , look at the extent and character of our markets ; - limited to coasts and rivers , the great interiors of tho world shut up for want of roads in some cauns , and of safety or of freedom in others ; or in other cases ( an increasing class ) gradually supplying themselves with goods to our exclusion . Whilo then our power of production is capable of rapid and indefinite expansion , our markets are straitly bound up and limited .
When the oTcpanniblo productive power , tinder the stimulus of abundant floating capital , real or in the nature of credit , has filled to overflowing the bound up and limited markets , and cannot force its goods into tho interiors for want of the means of bringing down ii » payment the heavy produce of tropical countries and little advanced communities , then eomoH n . eommoreial erisin , a punie ; tho commercial agents brook down under ongugomonta which ,
from natural circumstances , it has become impossible for them to fulfil . Let it again , be remembered , that the accession to tho quantity of goods produced comes of the accession to the capital which can be devoted to the purpose , or to its substitute , credit . The particular form which the stimulus assumes , is that of a general rise of prices : every man who has made goods finds he has realized a profit , perhaps greater than he expected ; but the rise has actually come of ah increase in the proximate purchasing power of the commercial ag'ency , not of an increase in the distant actual consumption . The latter Is unaffected , and eventually fails to carry out its necessary part of the process ; it is the former which supplies the immediate stimulus to the manufacturer to increase his produce .
With an industrial system , of which these are essential features , we have at present an influx of gold , which is of itself sufficient to carry our productive capabilities far beyond the gauge of our markets . What , then , will be the effect of adding 30 millions of mobilized debt to the capital already available for active production ? Nothing less , we apprehend , than a fever excited to madness . We are already within the uncontrollable , although not very coaspicuous , acceleration of the descent to the rapids ; and Mr . Gladstone , with the best intentions , we believe , puts out an oar to pull us still faster in the same direction .
The danger , however , lies still more in the Indefinite and seductive character of the measure , than in the effect of the first 30 millions to which it is to apply . That effect will be the very agreeable one of a rise of prices—that is , however , of a rise of prices at home , without corresponding consequences abroad . Then comes difficulty , for which a ready relief will present itself in a new mobilization . The evil , ever growing , is easily disguised and covered up for a time by a new addition to its cause ; but the end must come , and the severity of the crash will be proportioned to the intensity of the stimulus to production , atid the time during which expedients of the day have permitted it tc accumulate the consequences .
Closely connected with this consideration is another , which renders caution doubly necessary . To provide for changes which cannot be foreseen , Mr . Gladstone proposes that much of this power of mobilization should be left with the Government . If all the views we have just expressed are not entirely unfounded , the proposition of Mr . Gladstone , made , we fully believe , in all sincerity and rightmindedness , would really place in the hands of the Government for the time being a power of control over the entire economics of the country , such as no Government ever possessed before , and as' no Government could possibly exercise but for unmeasured evil .
The plan proposed , as far as it relates to Treasury bonds , amounts to an entire reversal of the policy which extinguished one-pound notes , which regulated the Bank of England , and -which generally tended fo restrain the organization of commercial credit . In as far as that policy was an interference with private judgment as to the mode of individual operation , we hold it to havo been , unsound in principle and detrimental in effect ; but such a reversal of it as places powers of an artificial character in the unstable and ill-informed hands of the Government of the day , which in their natural state were refused to every man in view of his own position , and with regard to his own affairs , we believe to be one of the greatest errors into which modern British legislation can be led .
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" abuses op constitutional goveknmient . " Tub abuses -which peculiarly belong to the forma of constitutional Government , " was the phrase used by Lord Malmesbury in repudiating Lord Stanloy ' s plan of examination i ' or diplomatic candidates . Lord Malmesbury was scarcely under the necessity of repudiating even tho abuses of constitutional Government . Whatever they may bo , they must bo quite different from tlioso abuses which would claim Lord Malmesbury ' s respect—such as eulogies on the glory of tho two Napoleons , or such as tho employment of police to play tlio spy upon patriots . If wo are to have ! " paternal " Government amongst us , lot us understand the extent to which it is to be carried .
Is jt to l-egulatc our clothing—luif s , for instance ? If so , the hat wearers of the metropolis arc not tho only persons interested , tho hat . makers should ask for early intimation of tho CactH . " The batters of Munich have petitioned tho Municipal Council to decide what sort of hatu they may soil , sineo all hats of an . unusual shape arc constantly seized by tho police After Hotue discussion , tho Council declared itself incompetent , to decide on the question . " It is reserved for a higher authority . Our police has not yet got to hats , though it has long hud newspapers under its control , through the ntfimp-tax ; it has now got to cabs ; it possums it . s spies , and there aro Rome doubts whether it has not got back into the Postolliee .
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NOTIONS TO COKUKSPONDKNTH . V . N . in teehnienlly ri tf lit in £ li « objection whioh h « takes to tho UHrt of n nartiouhir tillo . If h <> Iiuh read our journal provioiifily , ho will Imvo olmorvoil that wo habitually draw the ilintiuetion at which Iu » point * . Ah a ^ rtiitleman , however , ho will poreeivo tho ( lill ' oreneo hotwijen ab . ttinoiuio from lining it jmrtieiiinr titlti too goimriilly , and tho revocation of that titlo wluiu if , linn boon accidentally employed . In tho latter eiuwit bocoinoH not only « pcdftiitry , but . an aflVoiit . JVnotiojilly , however , thoro him boon no ii »| nmitioii in tho Mann , cither on ournolvoh or tho miuler . () A ) ¦ « loiter in too bulky , lfho oim pack it closer , we muj f | M (| room for il . H iiiHortion . 'l ^ ho MH . in lolt lor him at tlio ollloo . Wo aw a ^ ain compelled by extraordinary priiHHuro of political mat tor to pontpono nmerlion of novoral lottorn , & . 0 ,, already in
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Apbii . 16 i 1853 . ] THE LEADER . 39 ?
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Leader (1850-1860), April 16, 1853, page 377, in the Nineteenth-Century Serials Edition (2008; 2018) ncse2.kdl.kcl.ac.uk/periodicals/l/issues/vm2-ncseproduct1982/page/17/
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