Last winter in the United States

by F. Barham Zincke

Before I went to America, I felt as certain as one can feel about any future event, that the Americans would pay every cent of their debt. I think still they possibly may. For their own sakes and for the honour of the race I hope they will. But I am not now so positive on this point as I was. Wherever it was allowable in conversation, I introduced the subject of the debt. At first, to my surprise (but after a time I got so accustomed to the expression of the sentiment that I should have been surprised had I heard anything to the contrary), I never met a single person in railway cars, or in hotels, who was in favour of complete payment. Many were in favour of complete repudiation; but far the greater number advocated the plan of immediate payment, by an issue to the public creditors of, as I heard it sometimes put, cartloads of greenbacks. This, of course, would not be very far from repudiation pure and simple: though nominally a payment in full, it would really be only the payment of a few shillings in the pound, as so large an issue would enormously depreciate the value of the greenbacks. This is the plan of Mr. Pendleton of Ohio, who is now the democratic candidate for the next presidency. It must therefore be approved generally by his supporters. The people, at a knowledge of whose sentiments I arrived in the way I have just mentioned, belonged chiefly, I suppose, to the class of storekeepers and travelling traders; though I have sometimes heard persons whose position I knew was better announce the same opinions. On the other hand, however, I never met with any flourishing and respectable merchant, and I may almost say with anyone whom we should describe as belonging to the upper class of society, who admitted for a moment the possibility of repudiation in any form. It seems, then, that in forecasting the probabilities of this question, the class that has numbers on its side must be regarded as pitted against the class that has on its side cultivation, intelligence, and wealth. But even from these few, some, as was once observed to me, ought probably to be discounted; because it is possible that some may be making a cheap profession of honesty, which they know will not, and have no wish ever should, be acted on. And the more certain they may feel of ultimate repudiation, the louder they may declare themselves in favour of payment. The South, whenever it shall have resumed its place in the councils of the Union, will, as most people seem to think, be in favour of the use of the sponge; for how can people be expected to tax themselves to pay for what was the instrument of their humiliation, conquest, and ruin? The question, then, between payment and repudiation, complete or partial, cannot now be decided so clearly and peremptorily against the latter as one could wish.

Of course the argument most commonly used against payment is, that it necessitates such a burden of taxation as is no longer tolerable, that it is impoverishing the whole community, destroying both the home and the foreign trade, and pressing with peculiar and insupportable weight on the humbler classes.

Again, it is urged by many that the amount of their taxation is the one undoubted cause, both of the cost and of the corruption of their government. If they go back to their old amount of taxation, there will be no work for, and, what will be more to the purpose, no funds to maintain, these armies of official bloodsuckers.

I found, too, that there was floating before the minds of some an entrancing vision of what would be the wealth of the country if production were cheapened and trade revived, and if everybody had twice as much money to spend as at present.

Another argument I frequently heard, was made to rest on an attempt to separate in idea the bondholders and public creditors of all kinds from the people; and while it spoke of them as an extremely wealthy class, living in luxury, and doing nothing (a very unrepublican position for anyone to occupy), it suggested the idea that their wealth was derived from the burdens, that is to say, the sufferings, of the masses of the people, who, all the while, were struggling very hard for a bare subsistence. The object of this comparison is to make the bondholder an object of odium, and the tax-payers of the humbler classes objects of commiseration, in the hope that by so doing a rankling sense of injustice might be implanted in the breast of the latter.

Arguments for Repudiation.

At an hotel in a town on the very frontiers of civilisation, two thousand miles away from Wall Street, I heard the question of ‘to pay or not to pay’ debated, and the conclusion in favour of the latter alternative was clinched by the proof of the impossibility of paying. The speaker was an ex-judge, and was a man who spoke and reasoned well,—I mean in such a way as to carry his hearers along with him. His argument on this point was very concise. ‘Just before the war,’ his words were, ‘the Government of the United States published a return, collected by its own officers, of the value of all the property of the people of the United States. The correctness of this return is unquestioned. We know from it both the saleable value of the property of the people and the annual income of that property. The property of the whole people is for purposes of taxation a single estate, but the debt we have incurred, plus the capital represented by our ordinary taxation, is greater in amount than the value of the whole of the property of the people of the United States; and the interest to be paid on the debt, plus the taxation required for other purposes, general and local, is greater than the income of the property of the whole people. And as no private estate can carry a debt greater in amount than the value of the estate, so no country can bear burdens that represent a property, if they were capitalised, greater than the property of the country, and an annual amount of taxation greater than the income of that property. I will not say, then, that the debt must be repudiated, for that would imply that we had some option in the matter; I will only say that it is impossible that it should be paid, either capital or interest. The estate can’t do it. It is an impossibility.’ Both the statements of this argument and the inference drawn from them appeared to the audience unquestionable. There was a murmur of assent, and conviction was expressed on every face.

I will report the firing off of one more shot against the payment of the debt which I was so fortunate as to witness. It is worth mentioning, both for the sake of the entourage and because it involves a style of argument I found very frequently used, and with convincing effect, among the people of the United States.

The Governor of ——, one of the largest States in the Union, had been so good as to invite me to call upon him, that I might be introduced to some friend of his who would be with him on the following day. On being shown into the reception-room, I found the Governor seated in a kind of state, with his back to the fire and his feet on the table. On the opposite side were seated in a row eight or ten persons. They appeared to be a deputation from some town or association, who were then having an interview with the Governor. When the interruption caused by my entrance was over, a tall grey-headed man who had been speaking as I entered resumed his argument. He had rather the look of a well-to-do farmer, not of our stolid type, but of the keen American type. He was quick and incisive in his style of speaking, and dealt much with interrogatories, as is common with persons who have been mastered by an idea, and cannot but think that it must appear to others just in the light in which it appears to themselves. He proceeded:—‘What I want to know is, whether this is not a republic?’ He looked round, and was satisfied with the amount of apparent assent. ‘The next thing I would ask is, what is the meaning of a republic?’ No one was prepared with an answer, and so he proposed one himself. ‘A monarchy is a government where everything is contrived for the advantage of an individual. An aristocracy is a government where everything is contrived for the advantage of a few. But a republic is a government in which whatever is for the advantage of the greater number either is or ought to be law. And now I ask another question: would it not be for the advantage of the greater part of the citizens of this State, and for the greater part of the citizens of the United States, that we should have no debt?’ This was an unassailable position; and so he at once proceeded to the conclusion. ‘Well then, I say, that if this is a republic there ought to be a law passed to free us from this debt. If we are not repudiators we are not republicans.’ I am unable to report any other arguments that were urged by the deputation, for at this point the Governor conducted me into another room.

The method of reasoning contained in the gaunt old gentleman’s argument against the payment of debts by republicans is, as I observed, very frequently used and very well received in the United States. It is worth noticing, because it is a method that is seldom used and never accepted on this side the water. It proceeds by assuming the truth of some abstract propositions, of which neither truth nor falsehood can properly be predicated, but which a half-instructed audience is always ready to accept, and then goes on to apply them to some question on which they appear to have a bearing, and which happens to be interesting at the moment. For instance, I was speaking on the subject of negro suffrage with one of the leading supporters of that concession in the South. An Englishman would probably have confined himself to the consideration of the fitness of the African for so important a part in the government of the country. My American friend contented himself with a kind of numerical formula. ‘Suppose,’ he said, ‘the grown-up male population of the country is represented by the number 100. By excluding the negroes from the franchise, you reduce the voters to about one-half, that is 50. But, in a constituency of 50, a majority of 26 will rule. That is to say, 26 will rule 100. That is bad, but it is not all the evil of the restriction. In small bodies it is generally found that one resolute mind takes the lead. The result therefore would be that one would rule the 100. All this would be the consequence of departing from the simple republican rule of giving the vote equally to all.’ The gentleman had this formularised argument in favour of the admission of the African to equal political power with the white race drawn out on a paper, which he took from his pocket-book and showed me—I quite believe, with the idea that I should find it unanswerable. It was all in vain that I pointed out to him that his argument was so abstract that it omitted all consideration of every one of the actual conditions of the question. He himself was thoroughly persuaded of its conclusiveness.