It was Sir David Barbour's great merit that he was not afraid of his own conclusions. He frankly stated, like all the other Commissioners, that Ireland's taxation, considered by itself, without regard to Irish expenditure, was unsuitable and unjust. He recognized that a system of taxation which was suitable for a rich, industrial, and expanding country like Great Britain was unsuitable for a poor, agricultural, and economically stagnant country like Ireland. He had before him the figures showing that two-thirds of the Irish population was rural, and that between three and four-fifths of the English population was urban.[107] He laid special stress on the fact that five-sevenths of Irish revenue, as compared with less than half the British revenue, was derived from taxes on commodities of general consumption, pressing heavily on the poor, and set forth the figures showing that the product of these taxes represented a charge of £1 2s. 0.95d. per head of the population in Ireland, and £1 1s. 0.05d. in Great Britain, although the wealth per head of Great Britain, as he admitted, "was much greater than the wealth of Ireland per head."[108] His conclusion was that this state of affairs, though regrettable, could not be helped, because, under the Union, whose permanence he took for granted, a change of general taxation to suit Ireland was simply impracticable. He did, it is true, point out incidentally that the same hardship might be said to affect poor localities in Great Britain and poor individuals in Great Britain, but he recoiled from the absurd fallacy involved in saying that on that account Ireland was not unjustly taxed. If he had gone to that length he could never have signed the unanimous Report.
I only mention this latter point because some outside critics have been bold enough to assert the fallacy in its completeness, proving, as they easily can, that the purchase of a pound of tea or a pint of beer is as great an expense to a man with 10s. a week in Whitechapel as to a man with 10s. a week in Connemara. Such reasoning nullifies the whole science of taxation. It would be as sensible to say that our whole fiscal system might wisely be transplanted in its entirety to any foreign country or to any self-governing Colony absolutely irrespective of their social and economic conditions and of their habits. Yet Ireland in these respects has always differed from Great Britain at least as much as any self-governing Colony and many European countries. The tea-tax produces scarcely anything in France; it produces an enormous amount relatively in Ireland, and is a greater burden there than in Great Britain. The wine-tax is not felt by Ireland; it is felt more by England; it would cause a revolution in France. Beer is taxed lightly in the United Kingdom, but the Irishman drinks only half as much beer as the Englishman. Meat is untaxed, but the Irish poor eat no meat. Spirits and tobacco are highly taxed, and they are consumed more largely in Ireland than in England. And so on. The whole Commission recognized that the circumstances of the two countries were different, and stated "that identity of rates of taxation does not necessarily involve equality of burden."
Nor could Sir David Barbour have dissociated himself from these conclusions without destroying the rest of his argument. He pointed out with truth that merely to reduce Irish taxation to its correct level, and to leave Irish expenditure where it was, would be to wipe out Ireland's contribution to Imperial purposes and leave her with a subsidy from Great Britain of three-quarters of a million. On the other hand, he held, as I have already indicated, that unduly heavy taxation in Ireland was already compensated for by an excess of local expenditure in Ireland as compared with Great Britain. But how, on its merits, and apart from the question of taxation, could such an excess be justified? The Act of Union had provided for indiscriminate expenditure in the event of a fiscal union. Most of the other Commissioners, indeed, had objected to the idea of distinguishing between "Imperial" expenditure and "local" expenditure, and striking a balance called an "Imperial contribution," without, at the same time, distinguishing politically between Ireland and Great Britain. In other words, they took up the not very logical position that Ireland must be considered as a separate entity for purposes of finance owing to the phrase about "abatements and exemptions," but not for purposes of expenditure. Whether this was a correct interpretation of the Act of Union has always been a matter of dispute, but the practical problem is little affected thereby. Sir David Barbour thought it an incorrect interpretation, and reached the more logical position that Ireland, both for revenue and expenditure, could be regarded as a separate entity. This view enabled him to put forward an argument which, while ostensibly palliating the over-taxation of Ireland, in reality condemned the whole of the political system established by the Union. We can, he said, in effect, rightly distinguish between Imperial and local expenditure, and it is permissible to spend more on Ireland than on Great Britain. By so spending more we not only cancel our debt to Ireland, but make her a present of a million which would otherwise go to swell her contribution to Imperial purposes. Now, to get at the pith of this argument, the reader must bear in mind what Sir David Barbour thought it needless to remark upon, that Ireland had, and has, a separate quasi-colonial system of administration of her own, but outside her own control, a system of which he approved. In other words, besides having to be considered in finance as a "separate entity," she was to a large extent in actual fact, politically, a "separate entity," though not a self-governing entity, to which through the channel of the Irish Government Departments a special large quota for local expenditure could be easily allocated. As an economist, therefore, and as an upholder of the strangely paradoxical system set up by the so-called "Union," Sir David Barbour was absolutely consistent.
So were Lord Farrer, Lord Welby, and Mr. Currie in coming to diametrically opposite conclusions. The crux of the discussion, stripped of academical reasoning, was simple. Everything turned, obviously, on the nature, amount, and origin of Irish expenditure. Sir David Barbour had passed lightly over these vital points, recommending only that any future saving of expenditure in Ireland ought to be used for Irish purposes—a further admission of Ireland's separate political existence—and shutting his eyes to future increases of expenditure. Lord Farrer and his colleagues, while agreeing that it was impossible to alter the taxation of Ireland so long as the Union lasted, agreed that additional local expenditure in Ireland could not be regarded as a set-off to undue taxation, not only because such a doctrine was inherently fallacious on economic grounds, and would hardly be listened to in the case of any other country than Ireland, but because Irish expenditure was subjected to no proper means of control. Both Irish revenue and Irish services, the former being only theoretically, the latter actually, distinct and separate, were outside the control of Irishmen, who had therefore no motive for economy. Nor was there any proper measure of determining what expenditure was good for Ireland and what was bad, though they held that there was reason to believe that much of Irish administration was both bad and costly. With regard to the extensive system of Imperial loans, whose charge swelled the Irish expenditure, they quoted the unchallenged evidence of Mr. Murrough O'Brien[109] to the effect that the system of Imperial loans for temporary emergencies and charity loans—"made to keep the people quiet or to keep them alive"—tends to increase the poverty of Ireland, "does not prevent the recurrence of famine, distress, and discontent," and that "a great deal of the money nominally meant to be spent on productive works has been misspent and wasted." They also dwelt, with emphasis, on official figures showing the extravagance of Civil Government in Ireland, the cost having risen from 1s. 10d. per head of the population in 1820 to 19s. 7d. per head in 1893, whereas the cost of Civil Government in Great Britain had only risen from 1s. 7d. to 11s. 5d. The charge for legal salaries and five principal Departments in Ireland was double the right figure according to population, and represented an excess cost of nearly £200,000. In wealthy and progressive Belgium, Civil Government cost 10s. per head, or little more than half as much per head as in Ireland.[110] The absurdity of representing such excess charges and the wasteful expenditure of a blundering philanthropy, as a recompense for over-taxation, was manifest.
Meanwhile, the rise in the cost of Irish Government, coupled with a stagnant revenue, had decreased the annual contribution of Ireland to Imperial services, which had fallen from five and a half millions in 1860 to two millions in 1894; unless, indeed, half the cost of Irish police, virtually a branch of the Imperial Army, and costing double the amount of Scottish and English police, were to be reckoned, not as an Irish expense, on the principle adopted by the Treasury, but as a part of Imperial expenditure. In any case both partners suffered from excessive and unwise expenditure in Ireland.
The gist of their conclusions was as follows:[111]
1. It is impossible, under the Union, to vary taxation for the benefit of Ireland.
2. Additional benevolent expenditure in Ireland is not a remedy for over-taxation.[112]
"We entertain a profound distrust of benevolences, doles, grants-in-aid, by whatever name they are called, ... or by whatever machinery it is proposed to distribute them, convinced, as we are, that in some form or other political influence or personal interest will creep in so as to defeat, in part at any rate, the attainment of the objects for which the expenditure is made."
3. "We believe that the expenditure of public funds cannot be wisely and economically controlled unless those who have the disposal of public money are made responsible for raising it as well as spending it." Grants of money "tend to weaken the spirit of independence and self-reliance," the absence of which qualities "has been the main cause of the backward condition" of Ireland.