\ ELEMENTS OF A PLAN FOR THE LIQUIDATION OF THE ^ublit MU OF THE UNITED KINGDOM. THE FIFTH IDITIOIT, WITH SUPPLEMENTARY OBSERVATIONS H. Bryer, Printer, Bridge- street, Blackfriars. ELEMENTS OF A PLAN FOR THE LIQUIDATION OF THE OF THE UNITED KINGDOM; BEING THE DRAUGHT OF A DECLARATION, SUBMITTED TO THE ATTENTION OF THE LANDED, FUNDED, AND EVE.UY OIHEIl DESCRIPTION OF PROPRIETOR. OF THE UNITED KINGDOM. WITH AX TNTRODUCTORY ADDhE'^S. BY RICHARD HEATHFIELD, Gent. LONDON : PRINTED FOR LONGMAN, HURST, REES, ORME, AND BROWN, PATERNOSTER-ROW ; J. M. RICHARDSON, CORNHILL; J. HARDING, ST. JAMES's STREET; AND WAUGH AND INNES, EDINBURGH. 1820. INTRODUCTORY ADDRESS. WHATEVER may be the difference of opinion, as to the causes and motives of the late war, it is evident tliat the British nation retires from, the contest, with the advantage of great in- crease in all the means of political power. In agricultural and cultivated surface, the in- crease is very considerable; in the British Ameri- can Colonies, in the Antilles, in Asia, in the south of Africa and in the British Isles, the augmen- tation of territory, of population and of pro- duction, constitute great accessions of power. In manufactures, generally, the ability of the United Kingdom to maintain successful Qompetition, throughout the world, is demon- B 995704 strated; the British warehouse is the resort of all nations for clothing, in most of the varieties required by the convenience and taste of each the increase of demand on British Industry, exerted in the useful arts, is indisputable. And so happy is the distribution of these several interests, so fortunate the relation of the several parts to each other, so harmonious the whole, as to produce, necessarily, a mighty arm, for protection and defence, in the marine, by which the intercourse, for the exchange of the natural and artificial productions of each, is conducted. The effect of this harmonious and powerful combination, has been experienced, in the in- vincible fleets and armies of Great Britain, in the unexampled expenditure by which those fleets and armies have been maintained. How, then, does it happen, that the increase of public happiness, is not only, not co-exten- sive with the increase of power in the body politic, but, is to be contemplated, as declining in the inverse ratio of that increase.^ That power in the whole, is suffering and sorrow in the individual ? The causes of the anomaly may be reduced to three general heads, namely. The System of the Public Debt. 3 A Population, exceeding the actual de- mand for labour. Education, as respects all classes of the community. Of these important subjects, the first men- tioned, only, is intended for present conside- ration, because, relief from the burthen of the public debt, appears to be indispensable to the successful institution of corrective or re- medial measures, with reference to all depart- ments of social life. Industry is the vital principle of pro- perty; abstracted from labour, the land, the spindle and the loom, are alike inert and unproductive : a free course to honest exertion^ and protection and compensation to the indus- trious^ are, therefore^ fast principles in the social compact. A public debt, whatever the circumstances in which it may originate, bears adversely upon those principles : the duties and taxes, inseparable from a public debt, enhance the price of all produc- tions, particularly the price of agricul- tural produce ; the market for the produc- tions of labour, and particularly of agri- cultural labour, is, consequently, circum- scribed; the course of industry is checked. B J The enhanced price of food, and of all neces- saries of life, disturbs the relation between the rate of labour and the price of subsist- ence, and places at hazard the compensation due to the active and industrious classes of the community. The charge of interest for loans of money ou(j]U, therefore^ never to he in^ curred by the state, — or, if necessary, as the al- ternative from a greater evil, should, with the least possible delay, be removed, by the fair a^id honest discharge of the principal debt. Great Britain has so long been accustomed to a national debt, so many conveniences ac^ tually do result and so many advantages appear to result, from her system of public debt, as to render the approach to the ques- tion of final and complete liquidation, an- xious, and not unmixed with the apprehen^ sion of the charge of temerity. The British system of public annuities is sanctioned by time, is recommended by the facilities which it accords to the annuitant, and is familiarised by use. But, if the positions now advanced, be true generally, they are true, more especially, with regard to Great Britain ; for, abstracted from the active disposition an^ industrious habits of her people, her empire is only a name: the sanction of a limited period of timCj, cannot alter the inherent character of things; if, for upwards of a century, a system of public annuities has been recognized and acted upon by the Government, necessity has ever been the plea for calling into action a measure always held to be objectionable; and ex- perience cannot be urged in favour of the attempt to support and continue, the recent extension of the system: the convenience of individuals, is not to be indulged to the pre- judice of the best interests of the community, and the apparent advantages will be seen, as the illusions of the fancy, if the system be at variance with the first principles of society, if the labourer he deprived of his fair reward, if, in consequence, the good order and well being of the state, be fearfully borne upon and inter- rupted. The public debt of Great Britain, is, for the most part, concocted on peculiar principles, principles which can only be justified by ne- cessity, and severe, indeed, must be the neces- sity which can justify their application. It is not lawful, between individuals, to con- dition for the payment of interest, and, also, for further compensation, by an addition to the principal sum advanced, on re-payment of the loan; a contract of such description, jbetween individuals, would be held to be re- pugnaiit to fair and honest prificiple; would disgrace the lender, and injure, if not destroy, the credit of the borrower. — What, however, is conditioned, what undertaken in a British loan? An examination of the three per cent, annuities will lead to sufficient explanation. In a bargain between the public and the loan contractor, under which a three per cent, annuity is created, it is conditioned, that in consideration of the advance or payment of a sum of money, ordinarily varying between fifty-five and sixty-five pounds, a transferable annuity shall be granted, of three pounds ; pro- vision not being made, for the redemption of the annuity, for any less consideration than the amount of Stock created or raised in favour of the annuitant, upon the grant of the annuity, namely, one hundred pounds ; and, as it may be convenient to the annuitant, to sell the annuity, without awaiting the chance of a forced redemption, the Government becomes bound to carry, periodically, into the public market, to purchase public annuities, sums of money, progressively increasing with the pro- gressive amount of the annuities, actually, from time to time, bought up : under the arrange- ments for this purpose, the amount applicable to the reduction of the debt of the United Kingdom for the year ended 5th January, 1819, was fifteen millions six hundred and twenty thousand five hundred and three pounds, se- venteen shillings, and five pence half-penny*. One effect relied upon from this plan, is the excitement of confidence on the part of the lender, and undoubtedly, the calculation is encouraging ; he is assured of five per cent, interest or thereabouts, on the capital ad- vanced, he has before him the calculation of the effect of the government demand, in the market for public annuities , he buys an annuity for which the grantor assures to him a market, for the grantor binds himself to become the chief buyer therein ; and he en- titles himself to receive one hundred pounds, for every sixty pounds advanced, (taking sixty pounds for the average) should his annuity be cancelled, compulsorily. The disadvantages of these terms are heavy and severe towards the public. The legisla- ture binds the public to pay the annuity wiiich the government has granted, so long as held by the public ajmuitant; when no longer so held, when redeemed, in virtue of the contract with the annuitant, the amount of the annuity is still required from the public, and for what purpose? to be carried into the market for public annuities, to assure to the * House of Commons Reports.— The public accounts, cited throughout, are the accounu to the 5th January, 1819. holders, so far as extensive, constant, and obligatory, purchases, can assure, an advan- tageous price for such annuities. It is to be admitted, that the ulterior object, proposed, or spoken of, is the redemption of the whole of the public annuities ; but, in the face of the advance in the price of the annui- ties, incident to the present system of purchase by the government; in the face of the frequent creation of annuities, in the face of the too pro- bable calculation of the return to a state of vrar, is such a result to be expected ? The idea of the public debt being effectually re- deemed, by means of the present system, cannot he gravely entertained, by any person possessing ordinary powers of refection. This is an awful conclusion; a conclusion in which the country cannot rest ; an alternative is to be sought, and the final object of these reflections is to point to that alternative ; it will not, however, be improper, previously, to state some of the consequences, which actu- ally flow from the public debt. By the direct and indirect effect of duties and taxes, the difficulty of procuring individual support, by plain and simple exertion, has been greatly increased. By the unrestricted issue of paper by the Bank of England, by means of the peculiar cir- culation of the currency, occasioned by the. immense collection and re-issues, by the Go- vernment 3 the facihty to speculative pursuits has been greatly increased. By the example of persons, successfully en- gaged in speculative dealing in the public an- nuities, a similar spirit has been excited and carried into the pursuits of trade, to an unpa- ralleled extent. The encouragement of patient labour and exertion, has, consequently, declined; the dis- grace of pauperism and insolvency has, there- fore^ diminished : The operations of trade have taken a turn decidedly speculative ; regular profits from trade, are, therefore, comparatively, seldom realized. What greater evil can befal a commercial community ? The indisposition to honest and patient labour, and the disposition to pursuits merely speculative, when carried to an extreme, comprehend the dissolution of the moral character of trade, — that is, in a trading country, the moral character of the community. The agricultural difficulties of the country, have been rendered plainly intelligible, by par- liamentary discussion; they are every where felt, and the Statute Book declares, that the people of the United Kingdom, must not expect, under the present system, at any definable pe- riod, to eat cheap bread; and yet, notwith- standing this admitted state of difficulty, this C 10 kingdom, on the supposition of relief from the proportion of the duties and taxes, incident to the public debt, might be expected to grow corn, at a rate of price sufficiently low, to meet the flour of North America, in the mar- kets of the south of Europe : that measure of relief being supposed, the great capital of this country, the laborious habits of the people, the skill and management of the British farmer, the proximity to the markets of Spain and Portugal, would, probably, admit a liberal return of rent to the landed proprietor, and, of sufficient reduction of price to maintain com- petition in those markets : it is not intended to be advanced, that the United Kingdom could grow more than sufficient, or even suffici- ent, grain, for the national consumption ; the suggestion embraces, simply, the conception, that, in the case supposed, the rate of price would be such, as to assure to the grower, a fo- reign market for grain, in the event of a surplus quantity being produced, and, consequently, would encourage, in the highest degree, the investment of capital in the cultivation of the soil: whether that extent of consequence, would pi: would not, result, it is unquestionable, that under the supposed relief from impost, th« people would be cheaply fed, and that great and powerful impulse to the agriculture of the United Kingdom, would be experienced. 11 The same remission of duties and taxe^, although not calculated to affect the de- mand for manufactures, in a similar degree, would greatly augment that demand ; the United Kingdom is, undoubtedly, the general resort of nations, for the productions of the loom and of the anvil; most descriptions of British manufacture are produced at prices, which render the labour of the manufacturer a bless- ing to mankind; but it is, notwithstanding, clear, that an increase in domestic agriculture would cause an increase of consumption in manu- factures at home, and that reduction in price, and, consequently, extension of market abroad, would ensue, from the supposed reduction of impost: in many leading particulars, the Statute Book, to the very letter, is at variance with the first principles of political economy ; the duties which are imposed on the material of many branches of manufacture, may be in- stanced; namely, the duty on silk, hemp, flax, cotton-wool, foreign sheep's wool, indigo, and on most of the importations of materials for dying, printing piece goods, and other process of manufacture : partially cor- rected, indeed, by drawbacks and bounties, but still, weighing, sensibly, against the demand for British manufactures. Many of the trading and fiscal laws of Great Britain are the grov^^th of times of dis- C2 12 tressing emergency; those laws and regu- lations, to great extent, Avhen enacted, were allowed to be objectionable, were adopted as the lesser of conflicting eyWs, and it would be presumptuous to assert, that measures less onerous, under the circumstances, could have been devised : that consideration, is not, how- ever, now to be entertained; it is plain, that the British system of pubHc annuities is objec- tionable, in principle, and it is indisputable, that great inconvenience and distress proceed from its actual operation. It is, therefor e, to be considered, whether, the immediate, partial, relief, and the eventual, en- tire, relief of the British nation, from the burthen of a Public Debt, upon the basis of a general contribution in respect of property, inchidiag the amount of stock, created in favour of the public creditor, and the amount of all other public securities, (not being the property of ex-resident Foreigners) can be rendered practicable and safe ? It is difficult to estimate the private pro- perty in the United Kingdom, with the accu- racy to be desired. By the statement pub- lished by Dr. Colquhoun, which Dr. Colquhoun denominates, " An Attempt" to estimate the property in Great Britain and Ireland, (1812) 13 the amount of private property, in the United Kingdom, is represented to be, two thousand six hundred and forty-seven miUions, six hundred and forty thousand pounds : in that statement, the cultivated lands, constitute one half, nearly, of the whole sum; the cultivated lands, in England and Wales, being esti- mated at something more than £24 per acre: this is a moderate rate of estimate, the other particulars are evidently the fruit of much labour and research, and upon an attentive examination of the statement, taking into view the authorities which are cited in its support, there does not appear to be any reason to question the propriety, for the present purpose, of considering the private property in the United Kingdom under-rated at the sum of TWO THOUSAND FIVE HUNDRED MILLIONS, which is one hundred and forty-seven millions, six hundred and forty thousand pounds less than Dr. Colquhoun's estimate*. * ColquhouR on the Wealth, Power, and Resources of the British Empire. 2d Edit, p, 55* u The public obligations, in respect of the na- tional debt, separate into four divisions; namely. > H H W H s. 1— - r\ 1-— - p c wX p < p. P^ CI- P CO J2 P P p c O 5 CD P- 3 c Ox -i P- P 3 o' o O 3 p C/2 p 5* 5* 5= o •-J 00 o p P i2. p 2; cr 3 &- •-3 p O P P St • • irt- 13 00 CO <— - ft) P 3 P 3 o O^ •t • . 3 Hi C/2 o * 5* s s 5' p P ft) P oj tmm^ »-^ CTQ c-f (t) 1 "-? 1 r^- ►— v# ^1 03 >— ' Ct CO C^ ^^ j>:i J^ V* O "i:- 'rfi' * 3» 0© CO o >t o i^ 1— ^ o CS v» v*^ 3 — ' vT^ o t— ' o g S^ ^ o i__i -:i • CO Ox CO ^ ^ 2 bO -^ .{^ 1— 1 o o CO • If &3 WW *h'H . Hi rfi- to- >~* € to <>• o V* Ot 05 ss* Cji ^ -:l OS ^o §2 l_lii Ox g » oc 00 00 O ^ 5 *a bO 03 -a 03 15 1— ' l-J ^—1 H— 2,S o^ 00 Ci 03 -a b^l ^ o K-^ Is •— !• ^_i^ OS -:j ^ O^ • •*» t3 k^lH NN ■Ww *.|H M-t oq * * For the advantage of simplicity in treating the subject, regard is not had to the partial deviation from the principle of the Sulking Fund, which has been made in aid of the supplies for the present year (1819.) 15 Being a charge of forty-seven millions eight hundred and fifty-nine thousand nine hundred and eighty-seven pounds, fifteen shillings, and eleven pence half-penny, (not including the heavy charges of collection) in respect of a principal sum of one thousand one hundred and sixty-one millions eight hundred and three thousand two hundred and ninety-two pounds four shillings and three pence, and annuities for lives or for terms of years, in respect of which a principal sum of debt does not appear. The Sinking Fund, as to which the first mentioned charge of £15,620,503 17*. 5ld. has arisen, is required with reference to the Funded and Unfunded Debt, only 3 if the debt were provided for by other means, the demand on the public, in that respect, would cease and determine. To provide for the liquidation of the funded and unfunded debt, it is proposed, first. That ;— All private property in the United Kingdom, including all claims on the Government, in re- spect of money lent and advanced, (not being the property of ex-resident Foreigners) be de- clared, by the legislature, liable and subject to a contribution of fifteen per cent. 16 By which measure, taking The Private Property, at - - ^2,500,000,000 Tbe Funded Debt, ^ at - - 797,401,119 10^ Allow for claims .> of ex-refsident J. Foreigners 15,000,000 782,401,119 lOi the Unfunded Debt, at - - 51,992,"095 14 2\ Total je3,334,393,214 15 1 Specific provision would be made for the Reduc- tion of the Principal of Debt ^500,158,982 4 2 Principal of Debt, totals. Funded £797,401,119 lOJ Unfunded 51,992,095 14 2| . 849,393,214 15 1 Leaving ^349,234,232 10 11 to be provided from the following means and resources. If a clear and decided intention were manifested by the legislature to liquidate the national debt, on the basis proposed, it is antici- pated that government stock, of every descrip- tion, w^ould advance to 100*. Sums of money, * Unless, upon a liberal and comprehensive view of the relative rights and interests of the funded and other proprie- tor, a lower maximum should be concluded upon, in respect of the 3 per cent, and other Stock below 5xper cent.; a consideration which it is not deemed necessary or becoming, to entertain, in these pages : the argument and the calcula- tions proceed upon the basi? of 100 for all Stock ; the view, the least favourable, to the liquidation of the debt. 17 varying from small to great, are in daily course of accumulation in the United Kingdom, as well by public bodies as by individuals, which are the constant subject of investment : in the contemplated event of the advance of all go- vernment stock to 1 00, a considerable proportion of such monies, would be tendered to the British Government, without the intervention of third parties (as in the instance of a contract for a ge- neral loan) and without the creation of a princi- pal debt, exceeding the principal sum advanced, to be secured by transferable debentures, or otherwise, at an interest of three pounds per annum for the one hundred pounds advanced ; which would equal the produce of the same sum, if laid out in the purchase of 3 per cent, stock, at 100. It will be admitted, that the security of the British Government for the payment of the interest of money, is desirable : if that se- curity be not found in the public market, it will be souo-ht at the hand of the Government : the conditions of a loan, if money be not re- quired, in given sums, at stated times ; if ac- cepted, at a moment of convenience to the lender, will be prescribed by the borrower, by the Government, and not by the lender; and it is as clear as any prospective view of the nature of the question under consideration can be, that in the event of the measure now proposed being adopted, the facihties for the payment of 1« the portion of the public debt, not otherwise provided for, arising from new and proffered loans of money, at a moderate rate of in- terest, would be very considerable. It is proposed, that all monies, so lent, shall be applied in discharge of the principal of the present debt- a fresh debt, will, indeed, thus, be created, but, without the obligation to continue the present Sinking Fund, and not exceeding the amount of the principal of debt, not other- wise provided for. Other means and resources, with reference to the reduction, either of the capital of the original debt, or of the supposed newly created debt, are presented for consideration, namely : The contribution to be made in respect of British Colonial, and Asiatic property, so far as the same can be brought under the cognizance of the British legislature by an income tax, in respect thereof or otherwise. A contribution in respect of property to he acquired within the United Kingdom, after the date of the first general assessment, that is to sav, an income tax on all clear nett in- come, after the deduction of expenditure of every desmptioa. The surplus of taxes, which may be so re- gulated as to amount to a considerable sum, without preventing the large and liberal relief, immediately required. 19 The amount of stock which may for ever remain unclaimed. The contribution of 15 percent on the pro- bable greater amount of property, within the United Kingdom, than the sum of 2,500 mil- lions, already mentioned. The examination in detail, of these latter particulars will not, now, be deemed necessary : it must be obvious, that, in combination, they present the means of , completing the liquidation of the public debt ; opinion may vary as to the expediency of exerting all those means -, opinion may vary as to the selection of the means, if the whole be not exerted; but it is not questionable, that the means sug gested, would be fully equal to the purpose of liquidating the debt, not otherwise provided for, taking the amount at 350 millions. The following are the operative means, by which it is conceived, that the contribution or levy of 15 per cent, on the property actually within the kingdom, may be rendered prac- ticable and safe : it would not be prudent, if practicable, to carry the whole into effect, as respects the levy of money, at one moment of time, and the modes to be proposed, embrace considerations, which not only guard against that inconvenience, but, which, it is presumed, D 2 50 will exhibit the whole measure in a more ad- vantageous point of view than may have been anticipated. In respect of the stock-holder, annuitant for lives or for terms of years, and creditor on un- funded government securities, no more would be necessary, than the abatement of 15 per cent, from the capital stock or numerical amount of the claim of each individual, and the like reduction of annuity or interest. In respect of persons liable and subject to assessment on landed or other property, such persons being also public creditors, the can- celling of stock or other debt, to an amount equal to the sum of their respective assessments, would satisfy the demand upon each. In respect of persons liable and subject to an assessment on landed or other property, such persons not enjoying the facility men- tioned in the preceding paragraph, the levy of the contribution must be accommodated to the respective circumstances of the several parties. With regard to many, facilities would un- doubtedly be presented, by floating balances, by monies invested in foreign funds, by monies lent on mortgage, by the early and convenient sale of property and by other means. But it must, necessarily, happen, that a large amount, in the aggregate, would be required from persons, not possessing any other property 21 than the mimediate subject of the assessment: such persons may be classed thus ; 1st Class. — Proprietors of Lands, Dwelling- Houses, Mines, and Canals. 2d Class. — Manufacturers, Ship Owners, Mer- chants, Traders, Farmers, and others. It is suggested ; That the term of ten years might be allowed to the first class, for the payment of the prin- cipal sum to be assessed ; interest to be pay- able in the mean time, on the principal unpaid, at the rate of 5 per cent, per annum, by half yearly payments; or, if the principal sum re- main unpaid after the expiration of ten years, the rate of interest to be increased to 6 per cent, until the principal be paid*. That the assessment on the latter class, should be payable by equal instalments in each of the first five following years; in the mean time, interest to be payable on the prin- cipal sum assessed, at the like rate of 5 per cent., by half yearly payments ; discretionary powers being vested in commissioners to ex- tend the time of payment of the principal sum, but not in any case to exceed the term of ten years. ■ « ^ ! -» » . ■ — — - * In effect, a redeemable Property Tax. 22 It will be objected; That the discharge of the national debt would occasion a redundant capital. That the circulation of the amount of the half-yearly dividends on stock is favourable, nay essential, to the prosperity of the country. That the inquisition into the estate and pro- perty of every individual is objectionable, in principle, and would be inconvenient, in prac- tice. That the advance of all government stock to 100 would give an advantage to the stock- holder, more than equivalent to the sum of his contribution of 15 per cent. ; that he would derive a direct benefit, instead of bearing the burthen of the assessment, in common with the landed proprietor and commercial capitalist. That the want of the security of the Govern- ment would be severely felt, by the aged, the infirm, the minor; by corporate and other public bodies, by charitable institutions and by commercial capitalists. These objections, are, severally, of apparent weight, and it is not possible, in an imperfect state of society, to devise any comprehensive range of action, wholly free from difficulty ; it is, however, conceived, that each particular, objected, will admit a satisfactory answer. Capital cannot be, directly, either increased or diminished by the liquidation of the public 2S debt, by the means proposed : the stock-holder, or public annuitant, as such, is not a capitahst. The discontinuance of the sinking fund, would only render unnecessary the levi/ and repayment by the Government, of a sum of ftloney equal to the amount of that fund. The reduction of demand on the nation by the public annuitant, would, in like manner, only render unnecessary the levj/ and repay- ment of a sum of money equal to such reduction. The proportion of the payment to be made by the landed and other proprietor, in money, would pass through the Exchequer to the stock-holder, who would become the buyer or mortgagee of land or other property, to the same extent, as the proprietor, to pay his contribution, might become the seller or mort- gager; money must circulate for this purpose, but there would not be any increase of capital. There could not, in either case, be any in- crease or diminution of capital : whether more i)r les^ amount of money be passed through the E:kchequer, the sum of capital remains the same. The real effect, would, indeed, be the reverse of that which is supposed in the ob- jection ; the relief which the country would experience under an extensive remission of duties and taxes, would cause activity to ca- pital, and consequently, would, in the first in- stance, tend to the want, rather than the super- abundance of capital. u The question of the half-yearly dividends, turns upon a similar consideration ; the means of those payments are first derived from the public. In the instance of a village, con- taining fifty heads of families, who may contri- bute directly and indirectly to those issues, at the rate of 5/. per annum, each 3 if not so called upon, each individual (supposing the rate of wages to be the same) would find at his disposal, five pounds, yearly, more than he now commands, which he would expend within his own sphere, and would thus be the instrument of a better circulation, for all social and political purposes, than can be produced by any other means ; so with respect to all other classes of society. The instrumentality of the tax-gatherer^ cannot he necessary to the healthy circulation of the body politic. The inconvenience incident to an inquisition into the estate and property of every individual, is, undoubtedly, very considerable, and for any inferior purpose ought not to be proposed : the purpose in question, is, however, of the deepest concern to all who feel the value of social existence ; distress and danger press, and if the measures now brought into view, comprehend the means of extensive relief, of what compara- tive weight is the inconvenience objected? It is admitted that the stock-holder would en- joy an apparent advantage, as objected; three ^ 25 per cent, stock, under the influence of the measure recommended, would advance to 100; the contribution of the stock-holder being only 15 percent, he would receive 85/. for what would, no7v, in the market, produce only 70/.; upon the reinvestment of his money on government se- curity, at 3 per cent, he would, however, receive but 2/. 11^. per ann. say .3 per cent, on 85/. in- stead of 100/.: his income would be reduced 15 per cent, and, in that way, an equality with the situation of the landed proprietor would be produced:* if indeed, the capital should not again be advanced on government security, or when finally paid off, the stock-holder would obtain an advantage, but not more than he would have obtained in the market, as now constituted, whenever any consi- derable reduction in the quantity of stock should have been effected; and it will not be contended, that the nation, is, for ever, to ba oppressed with debt, to prevent the stock- holder from obtaining 100/. for the 100/, which * It may fairly be presumed that the Accountant General, most or all the corporate and other public bodies, and charitable institutions, the generality of trustees, and many individuals, on their own account, would avail them- selves of an opportunity of re-investing the amount of stock held by them or in their names, on government security, if paid off, and the opportunity were preseatcd. C 26 the books of the Bank of England, record in his name. The objection applies rather to the prin- ciple on which the stock has been created, than to the principle on which it is proposed that it be redeemed. It is also admitted that inconvenience would ensue to various establishments and classes of persons, if the Government were, at any time, wholly to decline all guarantee of interest for money, and it is not, now, necessary to deter- mine, definitively, whether, after the liquida- tion of the amount of the present debt, such guarantee should again, in any or what de- gree, and under what circumstances, be ac- corded or not; the incompatibility of such engagements, with first principles, has been shewn*, and in any event, it would be grate- ful to the country, to find her security the object of solicitude, and that the lender of money, on the security of the British Nation, no longer considered himself entitled to the terms of singular advantage which he has hitherto enjoyed. The immediate effect of the measures pro- posed may be Considered as represented in the following table. * Page 3, ( *26 ) The Public obligations in respect of the national debt, have been stated, page 14, as follows: — Sinking Fund Funded Debt Unfunded Debt .... Annuities for Lives or for Terms of Year Principal. Immediate Reduction. The niAo?e of the Sinking Fund .... Funded Debt, amount . 797,401,119 lOj Allow for claims of ex-resident Foreigners . . . 15,000,000 28,131,187 3 7J 529,178 17 01 312,410,077 9 2 Fifteen per cent, on £782,401,1 19 lOi 27,C02,008 6 61 117,360,167 17 Fifteen per cent, on Unfunded Debt | 7,798,8 1'4 7 The Debt and Interest would immediately be simplified and reduced to ... . 15,620,503 17 5i 4,140,301 4 11 311,955 11 6 The application of the Assessment on the property estimated at 2500 millions would also be immediate, in relief of the industry and exertion of the country, and the principal sum of the Assessment being collected, the principal of the Debt would be reduced by the sum of Until collected, the Interest thereon at 5 per cent, per annum, payable by the several parties assessed, and appli- cable to the satisfaction of Interest payable to the stock-holder, would amount to Leaving to be provided for to complete the liquidation of the debt, the principal sum of Or for Interest, and Annuities for lives and for terms of years, and charges of management, the i lOf ,410,077 9 2 ,401,119 10| ,992,095 14 2J 1161,803,292 4 3 437,569,059 13 4 724,234,232 10 1,000,000 349,234,232 10 11 for Terms of Ye.r«, iDCludini; Charges of ManBgemcnU £. ,. d. 15,620,503 17 5{ 28,131,187 3 7i 2,079,683 16 H 2.028,612 18 8i 47,859,987 15 Hi 27,787,230 2 1 9,037,230 2 1 It is to be observed on the above statement, that the sum remaining to be paid in respect of Interest would vary*; so long as the whole sum of 375 millions remained unpaid, the sum of £9,037,230 2«. \d. would be correct; on the extreme supposition to the contrary, namely, that the whole sum of 375 millions were to be paid immediately, the sum for Interest and Annuities for lives and for terms of years, would be as follows : Interest on £849,234,232 10s. llrf., taking the average rate of the Interest £12,421,107 Si Aiinuilies for lives or for terms of years 2,028,612 IS 3i • 14,449,719 18 7 In the event, the amount would vary between the two extremes, that is between £9,037,230 2«. \d. and £14,449,719 18s. Id. and may be taken at 13 millions. » The Interest for which Taxes must, for a time, be provided, would increase on the satisfaction or paymerit of the principal sum of the contribution, because so much of the contribution as would operate to the reduction ot':iper cent. 3| per cent, or 4 per cent, stock, would prevent an annual demand oa an equal amount of principal at 5 percent.; an individual being assessed in respect of landed or other property, of the value of one million, would be required on that account to pay .i 150,000, which at 5 per cent, per annum, would amount to .£'7,500 per annum, if the same individual possessed 3 per cent, stock to the same amouni, the income therefrom would be £!-.500 only, but by cancelling his stock, he would be relieved from the annual payment of ^,500— this consideration would accelerate the liquidation of the debt, but it would, in its operation, increase, proponionally, Ills sum of i'9,037,230 2». Id. above mentioned. The same effect would follow on the redemption of 3 pet cent. 3J per cent, and 4 per cent, stock, by means of the application of monies received at the Exchequer for that purpose. 27 For the present purpose, the principal sura of funded and unfunded debt, remaining to be provided for, after the cessation of the sinking fund, and the application of the principle of a contribution of fifteen per cent, to the funded and unfunded debt, and to the private property in the United Kingdom; may be taken at three hundred and fifty millions, and the interest thereon and annuities for lives or for terms of years, at thirteen millions nett, as re- presented in the preceding table. The means and resources for the liquidation of the principal sum of 350 millions have not been strictly defined, but it has been shewn that they are ample, and might be adopted, v^holly, or in part, as* should be deemed expe- dient. These means and resources may be recapi- tulated as follows, viz. British Colonial and Asiatic Income. Future Property. Excess of Taxes.* * If the general taxes, relative to the national debt, were fixed at thirteen millions nett^ to which sum they might be re- duced, simultaneously with the application of the measures now proposed and suggested ; to be continued at that amount, until the final extinction of the national debt ; in proportion as the principal sura of 350 millions and the annuities for hves or for terms of years were reduced, a sum, from the taxes, would become applicable to the discharge of the remaining principal. E 2 '2S Stock unclaimed. The probable greater amount of the private property, than 2,500 millions. Expiration of Annuities for lives or for terms of years, by effluxion of time. On a review of the preceding statement, it appears, that the burthen to be borne by the combined propertj^ and exertion of the United Kingdom, amounts to one thousand one hun- dred and sixty-one millions and upwards, be- sides annuities for lives and for terms of years, amounting to two millions and upwards ; equal to an aggregate principal Bum, of. one thousand two hundred millions or thereabouts; and that the annual charge, in respect thereof, amounts to forty-eight millions, nearly, exclusive of the heavy charges of collection. The whole of the private property in the United Kingdom, has been stated at two thousand five hundred millions; it may be somewhat more or less, but a difference is not to be presumed, sufficient to vary, materially, the apparent relation of the debt to the property, which, combining the consideration of the Sinking Fund, is as one to two, or approaching thereto. By this brief summary, it will become mani- fest, that the conceptions which have been disclosed, do not involve the principle of individual or personal sacrifice ; it is sufficient- ly plain, without having recourse to analysis. 29 that the pressure of the debt, already, falls heavily on the proprietor: the husbandman, the artificer, all in the subordinate ranks of life, are distressed ; and in a country, so knit by the social ties, what distress can afflict the poor that does not re-act upon the wealthy ? the wealthy bear, not only, their own immediate proportion of the burthen, but, by re-action from those who are below them, in the scale of society, are destined, eventually, to bear the whole ; they are the last to feel the whole weight of con- sequences, but they are the responsible members of the firm, and on them the consequences will accumulate and finally fall : the burthen is equal to fifty per cent; property throughout the United Kingdom, may be considered as mort- gaged for fifty per cent.* The redemption pro- posed, proceeds on the calculation of a contri- bution of fifteen per cent, only : it may appear paradoxical, but every proprietor would, rela- * Unless the proposition be qualified by the consideration of the proportion of the burthen borne by the public creditor, in respect of his annuity or interest expended within the kingdom : if, however, the amount of annuity and interest receivable by the public creditor, which may be supposed to be applied to the further purchase of annuities, and the amount remitted to foreigners and for foreigji expenditure by British subjects^ be subtracted from the whole sura of the public annuity and interest, and it be also considered that domestic residence cannot be enjorcedy the position assumed, even so qualified, does not vary materially. 30 lively, be much richer, after the alienation of part of his property, than before, and the ex- pectation might be indulged, that he would become a m.ember of a well regulated, and prosperous, instead of a deranged and harass- ed community. These explanations have been deemed ne- cessary to the introduction of the Draught of Declaration annexed. The nation requires im- mediate relief, and the form of a declaration has been preferred, because, it is more manly, quite as constitutional, and, in all respects, more becoming, that m.easures, comprehend- ing the reduction, as to extent, though not in effective value, of the property of every indi- vidual, should originate with the subject, rather than with the Executive Government, on whom, this peculiar and w^eighty duty, cannot, fairly, be devolved, without the previous, fa- vourable, manifestation of public sentiment and opinion ; and if persons, whom the question, from extent of possession and weight of in- fluence, more nearly concerns, should, in any instance, assemble to deliberate on the sub- ject, the conceptions are thus presented to them in the form most convenient for that purpose. 31 DRAUGHT OF DECLARATION. WE, the ...--- - - - - have, with great anxiety, considered the state of the United Kingdom, on the well-being of which, we, se- verally, depend, in all the relations of social existence : we are actuated by an unfeigned and unmixed desire to contribute to the relief of the inconvenience and distress which press upon all orders of society ; we are persuaded, that, clear, simple, and comprehensive arrange- ments, in respect of the national debt, are ne- cessary to that end, and, under the influence of that conviction, we consider it a duty of indispensable obligation, to declare our sentiments, judgment and opinion thereon : which we, accordingly, declare, as follows; namely : 1st. That, the British Empire embraces a va- riety and extent of territory and population ; comprehending the means of producing great increase of national wealth and power, and of advancing private and individual comfort and happiness. 32 2nd. That, notwithstanding the possession and command of such means, the national duties and obligations are, with great difficulty, discharged, and severe and unusual pressure and inconvenience are experienced, in agricul- ture, in trade, and in manufactures ; by every order and class in active and social life. 3rd. That, the great weight of taxes occa- sioned by the present system of the national debt, is a principal cause of the existing incon- venience and distress. 4th. That, the abandonment of that system is indispensable to the full and proper exer- cise of the powers of this great community. 5th. That, the immediate reduction of the amount now payable by the British Nation, by way of annuity, or otherwise, annually, and the eventual complete redemption of the public debt of the United Kingdom, may be effected, without violation of the national faith, and without any dangerous or mischievous distur- bance of the state of property. 6th. That, the annual sum, payable, either to the government annuitant, holder of pub- lic floating securities or to the commissioners for the redemption of the public debt, consider- ed with reference to a principal sum of debt, is equal to a principal sum of one thousand two hundred millions or thereabouts. 7th. That, the sum payable in respect of 33 the national debt, including the charges of collection and management, approximates to one million, sterling, weekly. 8th. That, the levy of that sum, combined with the levy of the further sum necessary for the current purposes of the state, oppresses the industrious, injures the capitalist, and threatens the most calamitous consequences. 9th. That, the national debt is susceptible of liquidation on the basis of a contribution of fif- teen percent, on private property, including the amount of stock created in favour of the public creditor, and of all other public obligation in respect of the loan or advance of money. 10th. That, it is, therefore, expedient, that all private property in the United Kingdom, not being the property of ex-resident foreigners, in government or public annuities, be declared liable and subject to a contribution of fifteen per cent, on the value thereof. 11th. That, in the event of the adoption, by the legislature, of effectual measures for the general application of such principle of con- tribution, the further operation of the sinking fund would become unnecessary. 12th. That, in such event, the contribution of fifteen per cent, to be paid by the public annuitant, or other public creditor, would be, virtually, etlected, by the permanent reduction of all public annuities payable to British sub- F 34 jects, and of all other public securities, to the extent of fifteen per cent. 13th. That, the nation would be immediately relieved by that measure, from claims amount- ing to twenty millions, neit^ annually, or there- abouts. 14th. That, the contribution of fifteen per cent, in respect of land, manufacturing, ship- ping, commercial, and other property and ca- pital, would, further, as w^e apprehend, relieve the nation, from claims amounting to fifteen millions, nett, annually, or thereabouts. 15th. That, it v/ould not be necessary to press for the immediate payment of the con- tribution of fifteen per cent, in respect of the subject matter of the preceding paragraph, because, for the term during which the same should remain unpaid, an annual payment on the amount of the respective sums remaining unpaid, might be accepted, by way or in lieu of interest, until paid. 16th. That, it appears to vis, however, that, to great extent, a peculiar facility for the payment or satisfaction of such contribution of fifteen per cent, is presented; namely, in respect of all persons who are public annuitants or other public creditors, and who would also become liable and subject to the contribution of fifteen per cent., in respect of other descriptions of property. 35 17th. That, the contribution on account of such other property, migiit be, effectually and readily, made, by such persons, by cancelling an equal amount or value in public annuities. ISth. That, we apprehend, that the class of persons referred to in the preceding paragraph is numerous, and that such persons are, under the present system, in effect, paying an annuity to themselves, from their own property, under a heav}^ loss, by means of the expence of ma- nagement, and under the more severe conse- quences of loss, prejudice, and inconvenience, by sympathy with, and participation in, the public and general distress. 19th. That, to assure the final and effectual relief of this United Kingdom from the disad- vantages incident to a public debt, it is expe- dient that measures should forthwith be deter- mined upon with a view to complete the liqui- dation of the debt. 20th. That, various means and resources are presented for that purpose, namely, A contribution, for a time to be limited, in respect of property, to be derived from the British Colonies, and from British India. The contribution, which might be levied, ior a time to be limited, in respect of property, to be acquired and realized, hereafter,, in the United Kingdom. S6 A surplus of taxes, after effecting the great reduction now indispensahly and imme- diately required. The expiration of the annuities for lives or for terms of years, by effluxion of time. The probability that some part of the govern- ment debt will for ever remain unclaimed, and that the amount of property, in the United Kingdom, exceeds the sum of tw^o thousand five hundred millions, at which sum, the same has been estimated as the basis of the 14th paragraph. 21st. That, without offering any opinion as to the expediency of having recourse to all the measures suggested in the preceding para- graph, or as to the selection of measures, should not the whole be combined, we recog- nize, therein, abundant means for the complete paym.ent and satisfaction of the principal of the national debt, not provided for by the other measures recommended in this declaration. 22nd. That, whilst the measures now recom- mended and suggested, would be in course of operation, we anticipate that all government stock would advance to and remain at or above iOO, and that the smn of one hundred pounds, invested in the purchase of three per cent. stock, would, consequently, produce an annual income, not exceeding three pounds. 2.3rd, That, the security of the British Go- 37 vernment, for the principal and interest of money, is a security, of a description, highly to be desired. 24th. That, sums of money, varying from small to large sums, are in constant course of accumulation in this United Kingdom, as well by public bodies as by individuals, which monies are the frequent subject of investment in go- vernment securities. 25th. That, in the contemplated event of the advance of all government stock to 100, we anticipate that a considerable proportion of such monies would be tendered to the British Government, on loan, without the intervention of third parties, (as in the instance of a contract for a general loan) the principal sum advanced, simply, to be secured by debentures or other- wise, at a rate of interest of three per cent, per annum. 26th. That, the -application of such monies, when so lent and advanced, in aid of the liqui- dation of the existing debt, would, as we an- ticipate, very powerfully accelerate the dis- charge thereof, and, although a new debt would, thus, be created, the new contract would be plain, direct, and simple, unincumbered with the obligation of the present extensive Sinking Fund, and would, as we presume, at no distant period, be terminated by the entire cessation o( public debt. 38 27th. That, we are impressed with a deep con- viction of the advantages which would flow to this Empire, from the force of simple institu- tions, that we cannot apprehend any mischievous or dangerous consequences from the temperate and gradual, but early and complete, relief of the nation, from the present complicated system of finance ; and we do, therefore, hereby ex- press our anxious and unqualified, desire, to witness the adoption, and to promote, by our individual example, the execution of any mea- sures, founded on a pnnciple of equal contri- bution, adequate to a purpose, which, com- prehending the interests, in their vital prin- ciple, of this mighty Empire, embraces the interests of the human race. SUPPLEMENT. SUPPLEMENT TO THE FIFTH EDITION. IT has been observed, by persons for whom the Author has great respect, that a view, in detail, of the advantages to be expected from the measure suggested by this Tract, if adopt- ed, would have added to its interest. It is obvious, that an extensive range of be- neficial consequences might be anticipated, and that the subject might be dilated into a work of much larger compass ; but the desire to produce an entire, unbroken view% of the leading principles and calculations, which must decide the judgment, on this great question, has prevailed over every other consideration, and determined the Author to adhere to the arrangement, under which, he originally en- deavoured to condense his conceptions. He avails himself, however, of the publi- cation of a new Edition, to remark: G :\ 42 That the proposed contribution of fifteen per cent, on the value of property in the United Kingdom, is to be considered as a composition for Duties and Taxes and other public obhgations, very much exceeding in amount, the rate of composition proposed; or, as a Property Tax, of the like benejicial cha- racter, in respect of persons to whom facilities for the payment of the composition might not be presented. Thus : The amount of the first and principal as- sessment, is estimated at FIVE HUNDRED MIL- LIONS and upwards*, the annual value of which, as a considerable part would be contributed in ^, 3|, and 4 per cent. Stock, may be taken at TWENTY MILLIONS. The general relief, consequent, immediately, upon the legislative imposition of that assess- ment, would be ;t £. s. d. In respect of the Sinking Fund, 3]2,4'10,077 9 2 Funded Debt, 117,360,167 17 1 Unfunded Debt, 7,798,814 7 1 Private Property, 375,000,000 £. 812,569,059 13 4 in round numbers, EIGHT HUNDRED AND TAVELVE MILLIONS, and the annual demand, * Page 16. t Table, p. 26. 43 in respect of the national debt, would be reduced, from the nett sum of FORTY-EIGHT' millions to the nett sum of THIRTEEN millions, or thereabouts*, which sums, including the charges of coliectionf, may be taken, in round numbers, at the several sums of FIFTY millions and FOURTEEN millions. The difference, is THIRTY-SIX MILLIONS, to which may be added the consideration of the public current expenditure, which might be expected to subside, in the like ratio of fifteen per cent., in respect of the public appoint- ments, within the United Kingdom, and in a ratio considerably higher, in respect of all stores purchased therein, for the use of the State. If it be allowable to take the reduction, under this head at FOUR millions per annum, J the amount will be FORTY xMlLLlONS, to be re- mitted in relief of the country, from the ne- ♦ Page 27. f The charges of collection amount to the average sura of £7.0s.4fld. per cent. See House of Commons Reports. If the revenue decline, the charges of collection will constitute a higher average, in some proportion to the diminution of revenue. The sum of fifty millions above-mentioned, com- bines the charges of collection, on the proportion, only, of the sum of forty-eight millions, supposed to be raised by Duties and Taxes. X The current expenditure, exclusive of the interest and other charge of debt, exceeds twenty-two millions per an- num.— House of Commons Reports. 44 cessity of raising money by loan, or of in- terrupting the operation of the Sinking Fund, whilst part of the national system of finance, AND, IN RELIEF FROM DUTIES AND TAXES. It will, therefore, be readily admitted, that the contribution of 15 per cent., by proprietors, possessing facilities for that purpose, and the Property Tax of 5 per cent, on the amount of the assessment, to be paid by proprietors, not possessing such facilities, until convenient to pay the principal sum to be assessed, would be met by a more considerable measure of direct and immediate relief; and it is hoped, that this statement will be admitted to be a satisfactory explanation, to the very few persons, who have objected, in general terms, that the measure proposed, is theoretical or impracticable. What objection can be urged that will not apply with equal, or greater force, to a Pro- perty Tax in aid of the present system ? If, indeed, it be said, that the circulation would be injuriously affected, the contrary has been shewn, pages 22 to 24 : the abstraction of money,from the innumerable channels through which it would otherwise flow, to be re-issued through the medium of the Exchequer, is a forced and morbid, in place of a natural and healthy, circulation. ♦ House of Commons Reports. 45 Or, if it be apprehended, that a sudden and injurious reduction of the value of commodities would ensue; it may be sufficient to remark, that the reduction of price, would proceed, not from a market, over-stocked, which, leaving the cost the same, only reduces the return ; but from the reduction of cost, by means of the remission of Duties and Taxes : the cost would be less, and, therefore, the price would be less. The sole guard, required, would be the protection of the stock on hand, whereon duty should have been paid, either, by the return of the duty, or, by allowing a reasonable time for the con- sumption of that stock, before the effective repeal of the duty. Since the introduction of the system of bonding, the stock of goods, whereon duty has been paid, is not of more than moderate extent. The progressive consequences and general effect, upon the country, will not now be enlarged upon, nor will any calculation be made, of the effect of the ultimate, entire, relief of the nation, from the burthen of debt; but the consequences, with reference to the parochial poor, may require some notice. The cost of subsistence would be reduced by- means of the general reduction of Duties and 46 Taxes : in such reduction, would, probably, be included, the Duties on most articles of import, used for the purposes of manufacture, and on most articles of British manufacture : in consequence, the demand for labour would be increased, and the approach, to a fair adjustment between the rate of labour and the rate of subsistence, would be facilitated. A just state of relation, in those particulars, is essential to the manage- ment and direction of the parochial poor; if the rate of labour be below the rate of subsist- ence, the poor unavoidably recoil upon those in the several degrees above them, in the social scale, and the consequences become severe, and of an anxious and awful description. The adjustment of the rate of labour to the price of subsistence, cannot be effected by direct, legislative interposition : it does not, however, therefore, follow, that a tendency to a just ba- lance in that respect, may not be promoted, by the Legislature or by the Executive Govern- ment : if employment could be increased, and the price of subsistence, at the same time, be reduced, the number of pauper poor would de- crease : on the supposition of the remission of the Duties on Salt, on the constituent ingre- dients of Beer, on Soap, Candles, Coals, and on some other articles, and that Bread were reduced in price; such circumstances. 47 concurring with the remission of the Duties, which now narrow the demand for articles of British Manufacture, would tend, power- fully, to the reduction of the number of the poor, depending on parochial aid, and the moment w^ould be favourable to the institution of a system, if such could be devised, to pre- vent the great evil of supernumerary popula- tion. On this subject, some thoughts occur to the Author, but he forbears, at this time, to com- municate them, because, they can only be rendered effectual, in application, in the event of relief, in the more commanding particular, which is the subject of this Publication, and because the question of population and the poor, is of a magnitude to require more distinct consideration. THE END, Shoril^ will he published, BY THK SAME AUTHOR, Further Observations on the practica- bility and expediency of liquidatingthe PUBLIC Debt of the United Kingdom, with refe- rence, particularly, to the Landed Pro- prietor 5 including some considerations on Population and the Poor. H. Brjrer, Frinter, Uridge street, Blackfriars, Lomlon. D 000 747 069