The History of England, from the Accession of James the Second - Volume 4 by Thomas Babington Macaulay (well read books txt) 📕

Jonathan's and Garraway's were in a constant ferment with brokers, buyers, sellers, meetings of directors, meetings of proprietors. Time bargains soon came into fashion. Extensive combinations were formed, and monstrous fables were circulated, for the purpose of raising or depressing the price of shares. Our country witnessed for the first time those phenomena with which a long experience has made us familiar. A mania of which the symptoms were essentially the same with those of the mania of 1720, of the mania of 1825, of the mania of 1845, seized the public mind. An impatience to be rich, a contempt for those slow but sure gains which are the proper reward of industry, patience and thrift, spread through society. The spirit of the cogging dicers of Whitefriars took possession of the grave Senators of the City, Wardens of Trades, Deputies, Aldermen. It was much easier and much more lucrative to put forth a lying prospectus announcing a new stock, to persuade ignorant people that the dividends could not fall short of twenty per cent., and to part with five thousand pounds of this imaginary wealth for ten thousand solid guineas, than to load a ship with a well chosen cargo for Virginia or the Levant. Every day some new bubble was puffed into existence, rose buoyant, shone bright, burst, and was forgotten.368

The new form which covetousness had taken furnished the comic poets and satirists with an excellent subject; nor was that subject the less welcome to them because some of the most unscrupulous and most successful of the new race of gamesters were men in sad coloured clothes and lank hair, men who called cards the Devil's books, men who thought it a sin and a scandal to win or lose twopence over a backgammon board. It was in the last drama of Shadwell that the hypocrisy and knavery of these speculators was, for the first time, exposed to public ridicule. He died in November 1692, just before his Stockjobbers came on the stage; and the epilogue was spoken by an actor dressed in deep mourning. The best scene is that in which four or five stern Nonconformists, clad in the full Puritan costume, after discussing the prospects of the Mousetrap Company and the Fleakilling Company, examine the question whether the godly may lawfully hold stock in a Company for bringing over Chinese ropedancers. "Considerable men have shares," says one austere person in cropped hair and bands; "but verily I question whether it be lawful or not." These doubts are removed by a stout old Roundhead colonel who had fought at Marston Moor, and who reminds his weaker brother that the saints need not themselves see the ropedancing, and that, in all probability, there will be no ropedancing to see. "The thing," he says, "is like to take; the shares will sell well; and then we shall not care whether the dancers come over or no." It is important to observe that this scene was exhibited and applauded before one farthing of the national debt had been contracted. So ill informed were the numerous writers who, at a later period, ascribed to the national debt the existence of stockjobbing and of all the immoralities connected with stockjobbing. The truth is that society had, in the natural course of its growth, reached a point at which it was inevitable that there should be stockjobbing whether there were a national debt or not, and inevitable also that, if there were a long and costly war, there should be a national debt.

How indeed was it possible that a debt should not have been contracted, when one party was impelled by the strongest motives to borrow, and another was impelled by equally strong motives to lend? A moment had arrived at which the government found it impossible, without exciting the most formidable discontents, to raise by taxation the supplies necessary to defend the liberty and independence of the nation; and, at that very moment, numerous capitalists were looking round them in vain for some good mode of investing their savings, and, for want of such a mode, were keeping their wealth locked up, or were lavishing it on absurd projects. Riches sufficient to equip a navy which would sweep the German Ocean and the Atlantic of French privateers, riches sufficient to maintain an army which might retake Namur and avenge the disaster of Steinkirk, were lying idle, or were passing away from the owners into the hands of sharpers. A statesman might well think that some part of the wealth which was daily buried or squandered might, with advantage to the proprietor, to the taxpayer and to the State, be attracted into the Treasury. Why meet the extraordinary charge of a year of war by seizing the chairs, the tables, the beds of hardworking families, by compelling one country gentleman to cut down his trees before they were ready for the axe, another to let the cottages on his land fall to ruin, a third to take away his hopeful son from the University, when Change Alley was swarming with people who did not know what to do with their money and who were pressing every body to borrow it?

It was often asserted at a later period by Tories, who hated the national debt most of all things, and who hated Burnet most of all men, that Burnet was the person who first advised the government to contract a national debt. But this assertion is proved by no trustworthy evidence, and seems to be disproved by the Bishop's silence. Of all men he was the least likely to conceal the fact that an important fiscal revolution had been his work. Nor was the Board of Treasury at that time one which much needed, or was likely much to regard, the counsels of a divine. At that Board sate Godolphin the most prudent and experienced, and Montague the most daring and inventive of financiers. Neither of these eminent men could be ignorant that it had long been the practice of the neighbouring states to spread over many years of peace the excessive taxation which was made necessary by one year of war. In Italy this practice had existed through many generations. France had, during the war which began in 1672 and ended in 1679, borrowed not less than thirty millions of our money. Sir William Temple, in his interesting work on the Batavian federation, had told his countrymen that, when he was ambassador at the Hague, the single province of Holland, then ruled by the frugal and prudent De Witt, owed about five millions sterling, for which interest at four per cent. was always ready to the day, and that when any part of the principal was paid off the public creditor received his money with tears, well knowing that he could find no other investment equally secure. The wonder is not that England should have at length imitated the example both of her enemies and of her allies, but that the fourth year of her arduous and exhausting struggle against Lewis should have been drawing to a close before she resorted to an expedient so obvious.

On the fifteenth of December 1692 the House of Commons resolved itself into a Committee of Ways and Means. Somers took the chair. Montague proposed to raise a million by way of loan; the proposition was approved; and it was ordered that a bill should be brought in. The details of the scheme were much discussed and modified; but the principle appears to have been popular with all parties. The moneyed men were glad to have a good opportunity of investing what they had hoarded. The landed men, hard pressed by the load of taxation, were ready to consent to any thing for the sake of present ease. No member ventured to divide the House. On the twentieth of January the bill was read a third time, carried up to the Lords by Somers, and passed by them without any amendment.369

By this memorable law new duties were imposed on beer and other liquors. These duties were to be kept in the Exchequer separate from all other receipts, and were to form a fund on the credit of which a million was to be raised by life annuities. As the annuitants dropped off, their annuities were to be divided among the survivors, till the number of survivors was reduced to seven. After that time, whatever fell in was to go to the public. It was therefore certain that the eighteenth century would be far advanced before the debt would be finally extinguished. The rate of interest was to be ten per cent. till the year 1700, and after that year seven per cent. The advantages offered to the public creditor by this scheme may seem great, but were not more than sufficient to compensate him for the risk which he ran. It was not impossible that there might be a counterrevolution; and it was certain that, if there were a counterrevolution, those who had lent money to William would lose both interest and principal.

Such was the origin of that debt which has since become the greatest prodigy that ever perplexed the sagacity and confounded the pride of statesmen and philosophers. At every stage in the growth of that debt the nation has set up the same cry of anguish and despair. At every stage in the growth of that debt it has been seriously asserted by wise men that bankruptcy and ruin were at hand. Yet still the debt went on growing; and still bankruptcy and ruin were as remote as ever. When the great contest with Lewis the Fourteenth was finally terminated by the Peace of Utrecht, the nation owed about fifty millions; and that debt was considered, not merely by the rude multitude, not merely by foxhunting squires and coffeehouse orators, but by acute and profound thinkers, as an incumbrance which would permanently cripple the body politic; Nevertheless trade flourished; wealth increased; the nation became richer and richer. Then came the war of the Austrian Succession; and the debt rose to eighty millions. Pamphleteers, historians and orators pronounced that now, at all events, our case was desperate. Yet the signs of increasing prosperity, signs which could neither be counterfeited nor concealed, ought to have satisfied observant and reflecting men that a debt of eighty millions was less to the England which was governed by Pelham than a debt of fifty millions had been to the England which was governed by Oxford. Soon war again broke forth; and, under the energetic and prodigal administration of the first William Pitt, the debt rapidly swelled to a hundred and forty millions. As soon as the first intoxication of victory was over, men of theory and men of business almost unanimously pronounced that the fatal day had now really arrived. The only statesman, indeed, active or speculative, who did not share in the general delusion was Edmund Burke. David Hume, undoubtedly one of the most profound political economists of his time, declared that our madness had exceeded the madness of the Crusaders. Richard Coeur de Lion and Saint Lewis had not gone in the face of arithmetical demonstration. It was impossible to prove by figures that the road to Paradise did not lie through the Holy Land; but it was possible to prove by figures that the road to national ruin was through the national debt. It was idle, however, now to talk about the road; we had done with the road; we had reached the goal; all was over; all the revenues of the island north of Trent and west of Reading were mortgaged. Better for us to have been conquered by Prussia or Austria than to be saddled with the interest of a hundred and forty millions.370 And yet this great philosopher-for such he was-had only to open his eyes, and to see improvement all around him, cities