[e] Pro tempore, pro spe, pro commodo, minuitur eorum pretium atque augescit. Aretin. See Mod. Un. Hist. xxxvi. 116.
By this means the quantity of property in the kingdom is greatly encreased in idea, compared with former times; yet, if we coolly consider it, not at all encreased in reality. We may boast of large fortunes, and quantities of money in the funds. But where does this money exist? It exists only in name, in paper, in public faith, in parliamentary security: and that is undoubtedly sufficient for the creditors of the public to rely on. But then what is the pledge which the public faith has pawned for the security of these debts? The land, the trade, and the personal industry of the subject; from which the money must arise that supplies the several taxes. In these therefore, and these only, the property of the public creditors does really and intrinsically exist: and of course the land, the trade, and the personal industry of individuals, are diminished in their true value just so much as they are pledged to answer. If A's income amounts to 100l. per annum; and he is so far indebted to B, that he pays him 50l. per annum for his interest; one half of the value of A's property is transferred to B the creditor. The creditor's property exists in the demand which he has upon the debtor, and no where else; and the debtor is only a trustee to his creditor for one half of the value of his income. In short, the property of a creditor of the publick, consists in a certain portion of the national taxes: by how much therefore he is the richer, by so much the nation, which pays these taxes, is the poorer.
The only advantage, that can result to a nation from public debts, is the encrease of circulation by multiplying the cash of the kingdom, and creating a new species of money, always ready to be employed in any beneficial undertaking, by means of it's transferrable quality; and yet productive of some profit, even when it lies idle and unemployed. A certain proportion of debt seems therefore to be highly useful to a trading people; but what that proportion is, it is not for me to determine. Thus much is indisputably certain, that the present magnitude of our national incumbrances very far exceeds all calculations of commercial benefit, and is productive of the greatest inconveniences. For, first, the enormous taxes, that are raised upon the necessaries of life for the payment of the interest of this debt, are a hurt both to trade and manufactures, by raising the price as well of the artificer's subsistence, as of the raw material, and of course, in a much greater proportion, the price of the commodity itself. Secondly, if part of this debt be owing to foreigners, either they draw out of the kingdom annually a considerable quantity of specie for the interest; or else it is made an argument to grant them unreasonable privileges in order to induce them to reside here. Thirdly, if the whole be owing to subjects only, it is then charging the active and industrious subject, who pays his share of the taxes, to maintain the indolent and idle creditor who receives them. Lastly, and principally, it weakens the internal strength of a state, by anticipating those resources which should be reserved to defend it in case of necessity. The interest we now pay for our debts would be nearly sufficient to maintain any war, that any national motives could require. And if our ancestors in king William's time had annually paid, so long as their exigences lasted, even a less sum than we now annually raise upon their accounts, they would in the time of war have borne no greater burdens, than they have bequeathed to and settled upon their posterity in time of peace; and might have been eased the instant the exigence was over.
The produce of the several taxes beforementioned were originally separate and distinct funds; being securities for the sums advanced on each several tax, and for them only. But at last it became necessary, in order to avoid confusion, as they multiplied yearly, to reduce the number of these separate funds, by uniting and blending them together; superadding the faith of parliament for the general security of the whole. So that there are now only three capital funds of any account, the aggregate fund, and the general fund, so called from such union and addition; and the south sea fund, being the produce of the taxes appropriated to pay the interest of such part of the national debt as was advanced by that company and it's annuitants. Whereby the separate funds, which were thus united, are become mutual securities for each other; and the whole produce of them, thus aggregated, is liable to pay such interest or annuities as were formerly charged upon each distinct fund; the faith of the legislature being moreover engaged to supply any casual deficiences.
The customs, excises, and other taxes, which are to support these funds, depending on contingencies, upon exports, imports, and consumptions, must necessarily be of a very uncertain amount; but they have always been considerably more than was sufficient to answer the charge upon them. The surplusses therefore of the three great national funds, the aggregate, general, and south sea funds, over and above the interest and annuities charged upon them, are directed by statute 3 Geo. I. c. 7. to be carried together, and to attend the disposition of parliament; and are usually denominated the sinking fund, because originally destined to sink and lower the national debt. To this have been since added many other intire duties, granted in subsequent years; and the annual interest of the sums borrowed on their respective credits is charged on and payable out of the produce of the sinking fund. However the neat surplusses and savings, after all deductions paid, amount annually to a very considerable sum; particularly in the year ending at Christmas 1764, to about two millions and a quarter. For, as the interest on the national debt has been at several times reduced, (by the consent of the proprietors, who had their option either to lower their interest or be paid their principal) the savings from the appropriated revenues must needs be extremely large. This sinking fund is the last resort of the nation; on which alone depend all the hopes we can entertain of ever discharging or moderating our incumbrances. And therefore the prudent application of the large sums, now arising from this fund, is a point of the utmost importance, and well worthy the serious attention of parliament; which has thereby been enabled, in this present year 1765, to reduce above two millions sterling of the public debt.
But, before any part of the aggregate fund (the surplusses whereof are one of the chief ingredients that form the sinking fund) can be applied to diminish the principal of the public debt, it stands mortgaged by parliament to raise an annual sum for the maintenance of the king's houshold and the civil list. For this purpose, in the late reigns, the produce of certain branches of the excise and customs, the post-office, the duty on wine licences, the revenues of the remaining crown lands, the profits arising from courts of justice, (which articles include all the hereditary revenues of the crown) and also a clear annuity of 120000l. in money, were settled on the king for life, for the support of his majesty's houshold, and the honour and dignity of the crown. And, as the amount of these several branches was uncertain, (though in the last reign they were generally computed to raise almost a million) if they did not arise annually to 800,000l. the parliament engaged to make up the deficiency. But his present majesty having, soon after his accession, spontaneously signified his consent, that his own hereditary revenues might be so disposed of as might best conduce to the utility and satisfaction of the public, and having graciously accepted the limited sum of 800000l. per annum for the support of his civil list (and that also charged with three life annuities, to the princess of Wales, the duke of Cumberland, and the princess Amalie, to the amount of 77000l.) the said hereditary and other revenues are now carried into and made a part of the aggregate fund, and the aggregate fund is charged with the payment of the whole annuity to the crown of 800000l. per annum[f]. Hereby the revenues themselves, being put under the same care and management as the other branches of the public patrimony, will produce more and be better collected than heretofore; and the public is a gainer of upwards of 100000l. per annum by this disinterested bounty of his majesty. The civil list, thus liquidated, together with the four millions and three quarters, interest of the national debt, and the two millions and a quarter produced from the sinking fund, make up the seven millions and three quarters per annum, neat money, which were before stated to be the annual produce of our perpetual taxes; besides the immense, though uncertain, sums arising from the annual taxes on land and malt, but which, at an average, may be calculated at more than two millions and a quarter; and, added to the preceding sum, make the clear produce of the taxes, exclusive of the charge of collecting, which are raised yearly on the people of this country, and returned into the king's exchequer, amount to upwards of ten millions sterling.
[f] Stat. 1 Geo. III. c. 1.
The expences defrayed by the civil list are those that in any shape relate to civil government; as, the expenses of the houshold; all salaries to officers of state, to the judges, and every of the king's servants; the appointments to foreign embassadors; the maintenance of the royal family; the king's private expenses, or privy purse; and other very numerous outgoings, as secret service money, pensions, and other bounties: which sometimes have so far exceeded the revenues appointed for that purpose, that application has been made to parliament to discharge the debts contracted on the civil list; as particularly in 1724, when one million was granted for that purpose by the statute 11 Geo. I. c. 17.
The civil list is indeed properly the whole of the king's revenue in his own distinct capacity; the rest being rather the revenue of the public, or it's creditors, though collected, and distributed again, in the name and by the officers of the crown: it now standing in the same place, as the hereditary income did formerly; and, as that has gradually diminished, the parliamentary appointments have encreased. The whole revenue of queen Elizabeth did not amount to more than 600000l. a year[g]: that of king Charles I was[h] 800000l. and the revenue voted for king Charles II was[] 1200000l. though it never in fact amounted to quite so much[k]. But it must be observed, that under these sums were included all manner of public expenses, among which lord Clarendon in his speech to the parliament computed that the charge of the navy and land forces amounted annually to 800000l. which was ten times more than before the former troubles[l]. The same revenue, subject to the same charges, was settled on on king James II[m]: but by the encrease of trade, and more frugal management, it amounted on an average to a million and half per annum, (besides other additional customs, granted by parliament[n], which produced an annual revenue of 400000l.) out of which his fleet and army were maintained at the yearly expense of[o] 1100000l. After the revolution, when the parliament took into it's own hands the annual support of the forces, both maritime and military, a civil list revenue was settled on the new king and queen, amounting, with the hereditary duties, to 700000l. per annum[p]; and the same was continued to queen Anne and king George I[q]. That of king George II, we have seen, was nominally augmented to[r] 800000l. and in fact was considerably more. But that of his present majesty is expressly limited to that sum; and, by reason of the charges upon it, amounts at present to little more than 700000l. And upon the whole it is doubtless much better for the crown, and also for the people, to have the revenue settled upon the modern footing rather than the antient. For the crown; because it is more certain, and collected with greater ease: for the people; because they are now delivered from the feodal hardships, and other odious branches of the prerogative. And though complaints have sometimes been made of the encrease of the civil list, yet if we consider the sums that have been formerly granted, the limited extent under which it is now established, the revenues and prerogatives given up in lieu of it by the crown, and (above all) the diminution of the value of money compared with what it was worth in the last century, we must acknowlege these complaints to be void of any rational foundation; and that it is impossible to support that dignity, which a king of Great Britain should maintain, with an income in any degree less than what is now established by parliament.
[g] Lord Clar. continuation. 163.