DEBATE ON THE CORN-LAWS—PROPOSITION OF MINISTERS ON THE SUBJECT.
On the 9th of February, the day on which Sir Robert Peel had announced he would develop the ministerial plan for the alteration of the corn-laws, extraordinary interest was exhibited both in and out of the house of commons. Every avenue of the house was thronged at an early hour by persons eager to obtain admission; and when the doors were opened every seat in the strangers’ gallery was instantly occupied. A number of the anti-corn-law delegates attempted to station themselves in the lobby; but being prevented by the police they stationed themselves outside the house, where they saluted the members as they passed with the cries of “No sliding-scale!” “Total repeal!” “Fixed duty!” &c. Shortly after five o’clock Sir Robert Peel moved: “That this house resolve itself into a committee, to consider the trade in corn.” He then requested that the clerk of the house should read that portion of her majesty’s speech which related to that subject. This being done, he observed that it was difficult to discuss this subject without making statements or admissions which would be seized upon by his opponents: but that he trusted to the reason, moderation, and judgment of parliament. The right honourable baronet then proceeded to state that he would not excite a hope that his measure would tend immediately to mitigate the existing commercial distress, and to enumerate the causes which had given rise to that distress. He then adverted to the various opinions obtained in the country as to a change of the corn-laws. Some opposed, he said, all change; others demanded immediate and instant repeal; and others required some modification. His own opinion was, that a total repeal of the corn-laws would aggravate the manufacturing distress; the prosperity of the two classes being identical. There were advantages in a fixed duty which did not apply to a variable duty; but the objection to the principle of imposing any duty on corn was equally applicable to both. Nor could, he argued, a fixed duty be permanent: he did not think they could impose any amount of fixed duty sufficient for the protection of agriculture in years of average supply, which they could determinately and fixedly impose in times of distress and scarcity. Sir Robert Peel next entered into a variety of arguments to show that this country, in ordinary years, was able to supply its own population. From the arguments he used he came to the conclusion that it was not advisable for parliament to alter the principle of the existing law; and the alteration which he would therefore propose went on the principle of retaining a duty on corn, varying inversely with the price of corn in the home market. He continued by observing that the maintenance of that principle involved the maintenance of a system of averages; and after expressing doubts whether there had not been much exaggeration as to the frauds and combinations to influence the averages, he thus stated the proposals of government respecting them:—“We shall propose to take the averages in the present mode, from the factor, the miller, or the purchaser. We shall propose that the duty of collecting the returns shall devolve on the excise. The excise is perfectly competent to this duty; it has officers employed in each market-town fully competent for the discharge of this duty by having greater duties to perform, and who will be able at a comparatively small increase of expense to fulfil this employment; and by their intelligence, their business habits, and the responsibility which attaches to them as public officers, they will afford far greater security against fraud than can be obtained by intrusting this duty to private individuals.” After stating that the averages were to be taken in all the principal corn-markets, Sir Robert stated the amount of protection to be given to the produce of this country. Having shown how the duty varied under the existing laws, and that they induced fraud, and having made some remarks on the term “remunerating price,” he thus described his new scale:—“We propose that when corn is at 50s. and under 51s. in price, a duty of 20s. shall be taken; but that in no case shall that duty be exceeded. We propose that when the price is 51s. and under 52s., the duty shall be 19s.; and after this we propose that there shall be what I should term a rest in the scale. That at the next items of price the duty should be uniform. Thus it would be: When the price is 52s. and under 53s. and 54s., 18s.; and when 54s. and under 55s., still 18s. When the price is 55s. and under 56s., we propose that the duty be 17s.; when 56s. and under 57s., that it shall be 16s.; and when 57s. and under 58s., that it shall be 15s.; and when 58s. and under 59s.. that it shall be 14s.; and when 59s. and under 60s., that it shall be 13s.; when 60s. and under 61s., that it shall be 12s.; when 61s. and under 62s., that it shall be lis.; when 62s, and under 63s., that it shall be 10s.; when 63s. and under 64s., that it shall be 9s.; when 64s. and under 65s., that it shall be 8s.; and when 65s. and under 66s., that it shall be 7s. At the three next items of price I propose another rest in the scale similar to the former. I should propose on the next three a duty of 6s., that is to say, when the price is 66s. and under 67s., when it is 67s. and under 68s., and when it is 68s. and under 69s. In each of these cases the duty would be 6s. When the price is 69s. and under 70s., I propose a duty of 5s.; when 70s. and under 71s., a duty of 4s.; when 71s. and under 72s., a duty of 3s.; when 72s. and under 73s. a duty of 2s.; and when 73s. and under 74s., a duty of Is. the quarter. When that price is arrived at, I propose that the duty should altogether cease; the sum of the proposition, then, is this, that when corn in the British market is under the price of 51s. the quarter, a duty of 20s. shall be levied, which duty shall never be exceeded, for I am quite satisfied that it is useless to take any greater amount of duty.” With respect to other grain than wheat, Sir Robert Peel proposed to adopt the proportion of value and duty which he found in the present law. “Colonial wheat and flour,” he continued, “shall be imported at a duty of 5s. whenever the price of British wheat is below 67s.; that when the price of British wheat exceeds 67s. it shall then be admissible at a duty of 6d. I propose to give the same advantage to colonial wheat, respecting the reduction of prices at which it shall be admissible, as is given to other descriptions of wheat. But considering that the sudden drop in the prices from 5s. to 6d., on account of the difference of Is. in the price, is at variance with the principle of the law, which seeks to establish as equable and uniform a reduction of duty as possible, we propose to make this arrangement respecting colonial wheat—that when the price of British wheat is under 55s., the duty upon every quarter of British colonial wheat shall be 5s.; that when at 55s. and under 56s., it shall be 4s.; and when at 56s. and under 57s., it shall be 3s.; and when at 58s. and upwards it shall be Is., thus taking away that sudden fall in the amount of duty, levied upon colonial wheat, which takes place under the existing law; but giving the colonial wheat that advantage in the reduction of the price which is given to other descriptions of wheat.” Sir Robert Peel finally thus recapitulated the reduction which his new scale would effect:—“When corn is 59s. and under 60s., the duty I propose is 13s. When the price of corn is at 50s., the existing duty is 36s. 8d., increasing as the price falls; instead of which I propose, when corn is at 50s., that the duty shall be only 20s., and that the duty shall in no case be exceeded. At 56s., the existing duty is 30s. 8d.; the duty I propose at that price is 16s. At 60a., the existing duty is 26s. 8d., the duty I propose at that price is 12s. At 63s., the existing duty is 23s. 8d.; the duty I propose is 9s. At 64s., the existing duty is 22s. 8d.; the duty I propose is 8s. At 70s., the existing duty is 10s. 8d.; the duty I propose is 5s. Therefore it is impossible to deny, in comparing the duty which I propose with that which exists at present, that it will cause a very considerable decrease of the protection which the present duty affords to the home grower, a decrease, however, which, in my opinion, can be made consistently with justice to all the interests concerned.” In conclusion, Sir Robert Peel disclaimed the idea of legislating in favour of particular interests, and expressed his conviction that the present was a favourable time for the settlement of the question. After a few words from Lord John Russell, and a brief reply from Sir Robert Peel, the house adjourned. On the following day Lord John Russell gave notice that he should, on the ensuing Monday, move a resolution condemnatory of a sliding-scale. The resolution was couched in these terms:—“That this house, considering the evils which have been caused by the present corn-laws, and especially by the fluctuations of the graduated or sliding-scale, is not prepared to adopt the measure of her majesty’s government, which is founded on the same principle, and is likely to be attended by the same results.” Mr. Villiers next announced that, on going into committee, he should take the sense of the house on the policy of imposing any duty whatever on foreign corn or food imported into this country. A third notice was given by Mr. Christopher that he should move in committee a scale of wheat duties, instead of Sir Robert Peel’s, imposing a maximum duty of 25s. when the price is 50s., and a minimum duty of Is. when the price is 73s., the duty falling by Is., as the price rises by Is.; except that at the rise of price from 59s. to 60s., the duty falls by 2s. The debate commenced on the 14th, when Sir Robert Peel moved that the speaker do leave the chair, in order to a committee of the whole house on the corn-laws. Lord John Russell then brought forward his amendment, and stated his objections to the sliding-seale. He remarked:—“The first objection I have to a sliding-scale, is, that a high, I would say a prohibitory duty, always forms part of it. I could understand a scale not exceeding 10s. or 12s., and going down to 4s., to 3s., or to Is.; but I find that whenever gentlemen speak of a sliding-scale, it is of such a nature as to contain a prohibitory duty. The first duty, when the price is at 50s., and under 51s., is 20s.; and I shall now proceed to show that that is a prohibitory duty. I have looked over the papers containing the latest information. From the information obtained by Mr. Meek, who was sent to the north of Europe expressly to collect information on the subject, it appears that the original price of Dantzie wheat, when brought from the interior of the country, is 35s.; that the charges, which seem to satisfy that gentleman’s mind amount in all to 10s. 6d.; thus making the price at which it could be sold in England in ordinary years 45s. 6d. If you add to that the proposed duty of 20s., you make the entire price of Dantzie wheat, 65s. 6d., when the price at home, is 50s.; showing of course that 20s. amounts to a prohibitory duty. In the same way at Odessa, as stated in the consul’s returns, the price would be 26s.; adding to which 10s. for freight, and some further charges, which cannot be taken or less than 5s., as on the former occasions, and adding then the proposed duty of 20s., you would have the price up to 61s., without counting the profit of the merchant who had to deal with this corn; and therefore, though you may say that you have reduced the duty to 20s., to 19s., and to 18s., yet in all three instances it can be shown that the duty is prohibitory; and that when the price is at 55s. or 56s., the price at which the right honourable gentleman said it would please him to see it, nobody can tell why, there would then be a prohibitory duty upon foreign corn.” Lord John Russell concluded by moving his amendment. The amendment was opposed by Mr. E. Gladstone, who thought that some of Lord John Russell’s opinions ought to have led him to support the government. The debate which followed lasted three nights, and the principal speakers were, on the ministerial side, Lord Sandon, Sir J. Graham and E. Knatchbull, and Messrs. Childers, Ormsby Gore, and B. Ferrand; and in favour of the amendment, Lord Worsley, and Messrs. C Wood, Labouchere, Ward, E. Buller, and Roebuck. The greater part of the speeches delivered consisted of recapitulations and reproductions of the reasonings and statements used by the leaders of either party. On a division the amendment was rejected by a majority of three hundred and forty-nine against two hundred and twenty-six. The house having thus pronounced in favour of the principle of a sliding-scale of corn-duties, it might have seemed illogical and superfluous afterwards to discuss a proposition of which the affirmative had been involved in the preceding decision; namely, whether corn should be subjected to any duties at all. Nothing daunted, however, Mr. Villiers brought forward his intended motion to that effect; a motion which, after five nights’ debate, was rejected by a majority of three hundred and ninety-three against three hundred and three. Subsequently Mr. Christopher brought forward his scale of duties as a substitute for those of Sir Robert Peel; but the original proposition was carried by an equally overwhelming majority. In committee various amendments were proposed, but they were all rejected or withdrawn, and the bill was, on the 5th of April, read a third time, and passed.
The second reading of the corn-law bill was moved in the house of lords, on the 18th of April, by the Earl of Ripon. Lord Brougham rose and moved the total and absolute repeal of the duty on foreign corn; but his amendment was rejected by an overwhelming majority. On the following day, on the motion to go into committee, Viscount Melbourne moved, “That it is the opinion of this house that a fixed duty upon the importation of foreign corn and flour would be more advantageous to trade and more conducive to the general welfare of all classes of the people than a graduated duty, varying with the average of prices in the markets of this country.” This proposition gave rise to a lengthy discussion; but it was rejected by a majority of one hundred and seventeen against forty-nine. Subsequently Lord Brougham moved these resolutions:—“That no duty ought to be imposed upon the importation of foreign corn, for the purpose of protecting the agriculturist, by taxing the introduction of food. That no duty ought to be imposed upon the importation of foreign corn, for the purpose of regulating trade, by taxing the introduction of food. That no duty ought to be imposed upon the importation of foreign corn, for the purpose of raising the revenue, by taxing the introduction of food.” These resolutions were rejected, as were others moved by Earl Stanhope, Lord Beaumont, and Lord Mountcashel, and the bill passed in its original state.
FINANCIAL MEASURES—INCOME-TAX BILL, ETC.
On the accession of Sir Robert Peel to office he was embarrassed with great financial difficulties. For the ensuing year he had to deal with a deficiency of £2,570,000; with contingencies in China and India of uncertain amount. The present juncture, indeed, demanded a remedial measure of a bold and comprehensive character, and Sir Robert did not fail to bring forward such a measure. On the 11th of March, in a committee of ways and means, the right honourable baronet said, that for the year ending April, 1843, the estimated revenue would be £43,350,000, and the estimated expenditure £50,819,000, leaving a deficiency of £2,469,000. With the contingencies in India and China, indeed, he calculated that the deficit, in the two years ending May next, would not be less than £4,700,000. How, he asked, were these deficiencies to be met? Should the system of loans and exchequer-bills be continued? Was there the prospect of any considerable reduction in expenditure? Was the present deficiency a casual one? Should he impose a tax on articles of consumption and the necessaries of life? Should he revive old taxes? Should he go back to the post-office? or revive the taxes upon salt, leather, or wool? Finally, should he resort to locomotion for the purposes of taxation? All these expedients Sir Robert repudiated; and he fixed upon one which, while it justly gave offence to a large body of the people, has proved to fully answer the end for which it was designed. This was an imposition of an income-tax of sevenpence in the pound upon all incomes from £150 and upwards, and in which was included not only landed but funded property, whether in the hands of British subjects or of foreigners. He estimated the assessable yearly value of the land at £39,400,000; of houses, at £25,000,000; and of tithes, shares in railways and mines, and other similar property, at £8,400,000: total, £72,800,000. From this he would deduct one-fourth for the exemption which he proposed to give to all incomes under £150, and then the tax thus far would give him £160,000. The occupiers of land, assessed at half their rent, would yield £120,000. Next came funded property. The dividend paid in 1841 was £29,400,000, from which he would deduct £1,000,000 in respect of savings’ banks; but he added upon bank, foreign, and other stocks £1,500,000, making a total of almost £30,000,000, from which, deducting one-fourth for incomes under £150 a year, he would derive £646,000. Sir Robert Peel next proceeded to incomes of trades and professions, from which he expected to obtain £1,253,000; and he then stated that from the incomes of public officers he calculated upon £150,000. The total would be £3,771,000. With respect to the duration of this impost, he said, that government might probably require it for five years; but he would in the first instance propose its continuance for three years. In case of war he should deem it reasonable that Ireland should bear her proportion of this tax; but during peace, and for a limited period, he should prefer to raise the quota of that country by other means. He proposed, therefore, a duty of one shilling per gallon upon spirits; the equalization of the stamp-duty with that of England; and a tax of four shillings upon coal exported in British vessels from this country. The aggregate revenue from these sources and the income-tax in England would be about £4,380,000; constituting a considerable surplus, after covering the deficiency on the votes of annual expenditure. This surplus Sir Robert Peel proposed to apply in relaxing the commercial tariff. The duties on raw materials were in no case to exceed five per cent.; the duties upon articles partially manufactured were to be diminished, the highest being twelve per cent.; and upon complete manufactures no duty was to be imposed higher than twenty per cent. He laid upon the table this amended scale of duties, which had been distributed under twenty different heads; in which, he said, would be found an abatement in about seven hundred and fifty articles, and that on about four hundred and fifty the duty had been left untouched. The total diminution of revenues occasioned by the reductions was estimated by the right honourable baronet at about £270,000. He regretted to say that upon sugar, ministers could not offer any reduction; but with respect to coffee he proposed a reduction of fourpence upon British, and eightpence upon foreign, which he calculated would cause a loss of £171,000 to the revenue. On the subject of timber, he said that his measure would be the reverse of that which was brought forward by his predecessors in office; he would advise a great reduction of duty, which would benefit all classes, from the agriculturist to the shipbuilder. His propositions were to lower the duty on foreign timber to twenty-five shillings a load, and to let in the timber of Canada at a duty of one shilling a load; causing a probable loss to the revenue of £600,000. There were yet two other reductions he had to propose: one upon the export of certain British manufactures, and another upon stage-coach duties. These two heads of reduction would produce a loss of £70,000. On the whole these reductions, in addition to the excess of expenditure, would increase the deficit to about £3,700,000; but the estimated produce of the income-tax would not only cover this, but leave more than £500,000 applicable to the contingencies of war in India and China. Sir Robert Peel concluded with an earnest appeal to the house to support the name which the English had inherited from their forefathers, untarnished: and he then moved his first resolution, which was to grant a duty on Irish spirits. No discussion followed Sir Robert Peel’s speech: the motion was agreed to, and the house resumed.
A few nights subsequently, Sir Robert Peel entered into an explanation of the details of the measures he had announced; especially with respect to the machinery by which the income-tax was to be collected. On the motion to go into a committee of ways and means, Mr. T. Baring found fault with Sir Robert Peel’s calculations; and he was followed by Lord Howick, who strongly censured the income-tax, and Lord John Russell, who condemned the construction of tire tariff for not working out its own principle, but sparing certain articles, as sugar, merely from fear of the influential interests connected with them. After three several motions by Messrs. Cobden, H. Berkeley, and Bernai, “That the chairman do report progress,” which were all negatived by large majorities, Sir Robert Peel was compelled to defer the measure till the 4th of April. The income-tax was resumed immediately after the Easter recess. The first resolution, to impose a tax of sevenpence on every pound upon all incomes, except the incomes of occupiers of land, was put and carried without discussion. On the second resolution, however, imposing a tax on the occupation of laud, calculated at the rate of threepence-halfpenny in the pound on the yearly value being read, Lord John Russell pointed out the operation’ the tax might have in inducing landlords to split their farms, so as to make the rental of each below the amount liable to taxation; and gave notice that, on the report of the resolutions, he should move this amendment:—“That it has been stated to this house, on official authority, that the deficiency of income to meet the expenditure of the country, may be estimated for the years ending the 5th day of April, 1842, at £2,350,000, and on the 5th day of April, 1843, at £2,569,000. That this house is fully sensible of the evil of a continued inadequacy of the public income to meet the expenditure, and will take measures for averting the same in future years. That, by a judicious alteration of the duties on corn, by a reduction of the prohibitory duty on foreign sugar, and an adjustment of the duties on timber and coffee, the advantage of a moderate price to the community may be combined with an increased revenue to the state. That, in addition to those main articles of general consumption, the interests of trade will be promoted by the repeal or reduction of various prohibitory and differential duties, and that extended commerce will improve the revenue, whilst it gives employment to industry. That the amount of taxes taken off, or reduced, from the termination of the last war to the end of the year 1836, exclusive of the tax on income, may be stated in round numbers at £23,873,000. That the income-tax, having been first imposed in a period of extreme emergency and during a most perilous war, was repealed on the re-establishment of peace; and having been again imposed on the renewal of war, was again repealed in 1816, on the termination of hostilities. That considering the various means of supplying the deficiency without enhancing the price of the necessaries of life, or embarrassing trade, it is the opinion of this house that the renewal of a tax, inquisitorial in its character, unequal in its pressure, and which has hitherto been considered as the financial reserve of the nation in time of war, is not called for by public necessity, and is therefore not advisable.” The second resolution was then put and agreed to; as was also the third, equalizing certain stamp-duties in Ireland with those of England; and the report was ordered to be brought up. Lord John Russell’s amendment came on for discussion on the 8th of April, when his lordship, in a speech of great length, charged the government with taking too gloomy a view of affairs, comparing the present aspect of the finances with that when an income-tax was formerly proposed. If new taxes must be resorted to, his lordship recommended a tax on the succession to real property, or the revival of some of the repealed assessed taxes. Mr. Goulburn defended the ministerial policy; and Sir Robert Peel vindicated himself from the charge of over-rating difficulties, and contrasted the state of finances which the Melbourne government found on entering office in 1835, with that which they left on their departure, in the British and Indian empire. The debate on Lord John Russell’s amendment lasted four nights, most of the principal speakers on both sides taking part in it. On the fourth night the house divided; when it was lost by a majority of three hundred and eight against two hundred and two. The report was then brought up and read, and leave given to bring in a bill founded on Sir Robert Peel’s resolutions. On the motion for the first reading of the bill, on the 18th of April, Lord John Russell moved that it be read a first time that day six months. A debate of considerable length ensued, in which arguments urged for or against the measure were repeated; after which the amendment was rejected by a majority of two hundred and eighty-five to one hundred and eighty-eight. The bill was then read a second time, and a few days afterwards the house went into committee. In committee the first question discussed was the period when the tax should commence; and the time finally decided was the 5th of April, 1842. The original proposition respecting schedule A was then affirmed, as was also schedule B. On schedule C Mr. Ricardo moved an amendment to exempt terminable annuities, and to subject them to special scales according to their market value; but, on a division, the motion was rejected by a large majority. In considering schedule D, which rendered incomes derived from professions, trades, and employments liable to the tax of sevenpence in the pound, Mr. Roebuck moved that it be fixed at half that sum. This motion was warmly supported by several speakers; but it was rejected, as was also another amendment to defeat this clause, moved by Mr. Sharman Crawford. Sir Charles Napier made a proposition on schedule E, to exempt officers in the army and navy from taxation; but this was also rejected: and after this the progress of the bill went on rapidly, more than eighty clauses being disposed of in one night’s debate. A second sufficed to get through the bill; amendments moved by Messrs. Baring, Hume, and Benjamin Wood, being all rejected by large majorities. On the third reading, Mr. Sharman Crawford moved an amendment, to the effect that the present house of commons could not be considered a fair representation of the people; and that therefore it was unfit that any system of increased taxation should be imposed by parliament until all just causes of complaint, with regard to the mode of electing members, should be redressed. Lord John Russell himself opposed this motion, and it was at once rejected; and after some further discussion on the bill, it was read a third time by a majority of one hundred and ninety-nine against sixty-nine. The bill then passed.