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two millions of hogsheads? That quantity would be one-thirtieth part of the whole; consequently, the level would be reduced only one-third of an inch.-This analogy would precisely meet the case, if every individual in the community paid an equable amount of taxation; that is, if, the national expenditure being sixty millions, and the population twenty millions, each individual paid three pounds. But if any fact be notorious to every person possessing common information on these subjects, it is the fact, that the labouring classes do not pay taxes, either directly or indirectly, in their numerical proportion.*
It is also to be observed that, admitting for the sake of argument, what no person can now deny as a question of fact, that our labouring population is superabundant, the benefit of any remission of taxation would not be received by the labourer, but would fall into the hands of the capitalist in the character of ant increase of profit; in other words, the minimum wages of the mechanic would fall in proportion to the reduction of taxation, † because the excess of the supply of labour, as compared with the demand, necessarily reduces (as the Report of the Select Committee on Emigration correctly states) the labourer's wages to that minimum which can sustain him in the discharge of the duties which he is called upon to perform, in a society where there are thousands of persons unemployed, who would be too happy to If the labouring execute the same duties for that minimum. population, instead of being redundant, were only adjusted to the demand, then a different state of things would arise.
It may be true that to make these propositions familiar to the people may require much pains and time; but we do not hesitate to express our opinion, that it is the duty of the government, not
We are well aware of the deplorable deficiency of data, in illustration of this most interesting part of political economy; and we take this opportunity of requesting attention to a tabular form, which it would, in our opinion, be extremely desirable to have filled up with scrupulous accuracy in every part of the country. We cannot conve niently introduce this in our text, but refer to Appendix B, (p.313, infra) where the reader will find an outline of Schedules, showing the expenditure of workmen employed in different trades and occupations, at different periods for each trade, so as to show the effect of prosperity and adversity on the comforts of the working classes, as well as the effect of taxation in diminishing these comforts.
+ Vide Report of the Select Committee on Emigration, which states, as the first fact which the Committee are prepared to substantiate, that there are extensive districts in Ireland, and districts in England and Scotland, where the population is at the present moment redundant; in other words, where there exists a very considerable proportion of able-bodied and active labourers, beyond that number to which any existing demand for labour can afford employment:-That the effect of this redundancy is not only to reduce a part of this population to a great degree of destitution and misery, but also to deteriorate the general condition of the labouring classes:-That by its producing supply of labour in excess as compared with the demand, the wages of labour are necessarily reduced to a minimum which is utterly insufficient to supply that population with those means of support and subsistence, which are necessary to secure a healthy and satisfactory condition of the community,'
only with reference to its own interest, but to that of the country, to familiarize the mind of the labouring people of this country with these genuine and undeniable truths, and to rescue it from the sedition-working mis-statements with which it is daily pampered. We should like to see a committee of the House of Commons appointed for the purpose of examining into the truth or fallacy of these statements. We should like to summon those members of Opposition who are most remarkable for their acquirements and knowledge; and if that committee were to report in favour of the truth of these propositions, we should like to see what would be the effect of resolutions of fact being moved in the House of Commons, founded on these principles. We regret, on this occasion, the loss of Mr. Ricardo. Whatever differences of opinion we might have entertained on abstract points of science, we are firmly persuaded that he would have always been found, had life been preserved to him, an unflinching supporter of what he believed to be the truth-utterly incapable of prostituting such belief to the political advantage of embarrassing a public opponent, by spreading a system of error and delusion. We firmly believe that he would have acceded to the opinions we have been stating; and we trust that he has left behind him men among his own party of equal integrity, who will not be less disposed to do justice to the subject. Mr. Ricardo never shrunk from the unpopular duty of giving the weight of his authority against the sweeping proposition-that agricultural and commercial distress, whenever they might occur, were the result of taxation. On the 5th of February, 1822, in the debate on the address upon the King's speech, (vide Hansard's Parliamentary Debates, New Series, vol. VI, page 87,) Mr. Ricardo said,-
Though he had agreed with everything that had fallen from his honourable friend, the member for Aberdeen, in favour of economy and retrenchment, he could not vote in favour of his amendment, as he differed widely from his honourable friend as to the causes of the present agricultural distress. His honourable friend had stated, that the cause of that distress was excessive taxation; but the real cause, it could not be denied, was the low price of agricultural produce. That taxation should be the cause of low prices, was so absurd, and so contrary to every principle of political economy, that he could not consent for one moment to the doctrine.'
On the 11th February, 1822, in the debate on Mr. Brougham's motion on the distressed state of the country, (page 270,) Mr. Ricardo
' denied that taxation was the cause of the present agricultural distress. A country might be totally without taxes, and yet in the exact situation that England was at present.'
Our space does not admit of the tables and calculations necessary to show the relative effects of the higher degree of taxation on the English labourer, when compared with that of France. Mr. Macdonnell, in his Treatise on Free Trade,' page 19, says,
The question is not, whether our land-tax, tithes, poor-rates, and other more general taxes, are large in themselves, but whether they greatly exceed those of that country (France) with which I have instituted the comparison. In this particular much error prevails.' And in page 20, he says,
The high taxation of England, operating as well indirectly as directly, does not very materially enhance the price of labour. I am of opinion that, by taking the excess of amount paid to the English mechanic, it does not form more than one-eighth part.'
In page 11, Mr. Macdonnell gives a comparative statement of the expenditure of a London mechanic with a wife and four children, and that of a Parisian mechanic with a similar family. He estimates the earnings and the expenditure of the former at 786. per annum, and of the latter at 45l. 10s. per annum, Of the excess of expenditure in the case of the English labourer, (viz. 32. 10s. per annum,) he attributes one-eighth (or 41. 1s. 3d. per annum) to the greater amount of taxation which is paid, directly or indirectly, by the English mechanic, as compared with the taxation borne by the French mechanic. He does not, however, give any calculation of the amount of the taxes, direct and indirect, which are paid by either the English or the French mechanic, but confines himself to the difference between the amounts of taxation in the two countries. It is therefore impossible, from Mr. Macdonnell's calculations, to derive any accurate data from which the effect of any supposable reduction of taxation in England upon the circumstances of the English mechanic could be inferred. If, however, we were to assume that an English mechanic, earning 30s. a-week or 781. per annum, paid one-eighth of his income, or 9l. 158. per annum, in direct or indirect taxes, the effect of a reduction of two millions, or one-thirtieth part of the total taxation of the country, would be, to reduce his expenditure by the sum of 6s. 6d. per annum, which (supposing him to have a wife and four children, as in the case put by Mr. Macdonnell) would be 18. 1d. per annum for each member of his family. But, supposing the mechanic to receive only 10s. a-week, (a rate of wages, we fear, more near the average truth in some of the distressed districts,) the effect of this reduction in the diminution of his expenditure would only amount to 2s. 2d. per annum for the whole family, or 4 d. per annum for each individual! As we have already said, it is impossible, without more accurate data, to arrive at the precise amount of the reduction which
would take place in the expenditure of a mechanic, in the event of such a remission of taxes; but the calculation which we have given will serve to show that the effect of such a reduction could not possibly fail to be altogether inconsiderable.After this train of reasoning, we would invite any person to consider the real benefit that would accrue to the suffering part of the population from so large a reduction as two millions out of the 16,369,8281. which is the real amount of the expense of our present establishments-a reduction which would cripple the public service in every department-diminish the national power, lower the national character, and destroy the seeds of future wealth and greatness, by paralysing all over the operations of the executive government.
We shall now proceed to show, that the classification which we have made is strictly and technically correct: No person will deny that the sinking-fund (as the law now stands) forms part of that expenditure, over which—whether that be expedient or notministers have no control, and which it is infinitely more just to classify with the existing debt than with the current expenditure of the year. We are prepared to contend, that the part of the half-pay annuity which has been actually sold to the Bank, bears precisely the same character of national debt as the old existing long annuities are admitted to bear. We also contend, that the unfunded debt, until it be redeemed, is more correctly to be classified with the national debt than with the current expenditure. With respect to the naval and military half-pay and pensionsundoubtedly for the moment arrangements have been made with the Bank, under which the whole charge does not fall on the current expenditure; but those arrangements are only to continue for a year and a half, after which, if new arrangements are not made to provide for them, our classification will in itself be unimpeachable. The pensions imposed by parliament on the consolidated fund are strictly part and parcel of the national debt. It is on these principles that we justify the construction of the scale, with respect to the column representing the national debt.*— The difference which appears in the columns, representing the collection of the revenue, the army, the navy, the miscellaneous, and the ordnance, arises out of the deduction from those several items of the amount of half-pay and pensions which, although (as we
*If the financial operation, familiarly known by the name of the dead-weight annuity, had been carried into effect, and if a long annuity of £2,800,000 had actually been substituted for a life annuity, which, in 1822, amounted to five millions, the section of the column, which indicates the unredeemed funded debt, must be increased by the sum of £2,800,000; and that the whole line, representing the national debt, must be curtailed by the sum of £2,200,000. ̧
shall presently demonstrate) they form strictly part and parcel of the public debt, are nevertheless brought forward in the estimates of the year by the government, as if they were parts of that current expenditure, for the maintenance of which they, and they alone, are responsible.
Everything relating to the national debt should, in short, be strictly separated from the current expenditure of the year, inasmuch as the one expenditure involves a responsibility from which the other is utterly exempt; and the threshold being thus cleared, whilst all practicable reductions of public establishments should be effected, all necessary increase of them should be allowed, and the principles which regulate the employment of private servants should be followed, in strict analogy, by those who have the direction of the public service of the country. If a farmer be told that he may reduce his waggon-horses from ten to six, provided he will work them in pairs instead of placing them one before another, and that he can under this change produce an equal quantity of produce without incurring any additional expense, he would act weakly and unwisely in not adopting the suggestion; but if, after he has reduced his ten to six, he is to be told, that the current annual expense of a pair of waggon-horses amounts to eighty pounds, and that he ought to sacrifice one pair more for the distinct and independent purpose of saving this sum, what will be his answer? -That it is very true an immediate saving would be made to the amount of 80%., but that the produce which he derives from the service of his horses would be diminished in an infinitely greater ratio. It is the same with respect to the clerks in a banking or commercial-house; and the analogy applies in the strictest sense to all government establishments. Those who have the charge of those establishments ought to be removed, if they are not sufficiently trust-worthy to be allowed the necessary means of effecting the public duties which are delegated to them.
We are aware that these observations will be met by the remark, that although establishments need not be decreased in number, the emoluments of the individuals composing them should be lessened. We answer, that the emoluments of the individuals belonging to establishments should be in proportion to the importance of the duties which they execute, and to the necessary expenses of the period in which they live; and, if we admit that cheapness of service is alone to be considered, we must abandon all those analogies which private life presents. You may tell an individual that he ought to employ a second-rate workman or tradesman, that he ought to fee an attorney instead of a barris ter, or an apothecary instead of a physician, because, by so doing, he would save money; but his answer will be in plain terms' Al