The History of England from the Accession of James II, Vol. 4

T >> Thomas Babington Macaulay >> The History of England from the Accession of James II, Vol. 4

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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 increasing, cultivation
extending, marts too small for the crowd of buyers and sellers,
harbours insufficient to contain the shipping, artificial rivers
joining the chief inland seats of industry to the chief seaports,
streets better lighted, houses better furnished, richer wares
exposed to sale in statelier shops, swifter carriages rolling
along smoother roads. He had, indeed, only to compare the
Edinburgh of his boyhood with the Edinburgh of his old age. His
prediction remains to posterity, a memorable instance of the
weakness from which the strongest minds are not exempt. Adam
Smith saw a little and but a little further. He admitted that,
immense as the burden was, the nation did actually sustain it and
thrive under it in a way which nobody could have foreseen. But he
warned his countrymen not to repeat so hazardous an experiment.
The limit had been reached. Even a small increase might be
fatal.371 Not less gloomy was the view which George Grenville, a
minister eminently diligent and practical, took of our financial
situation. The nation must, he conceived, sink under a debt of a
hundred and forty millions, unless a portion of the load were
borne by the American colonies. The attempt to lay a portion of
the load on the American colonies produced another war. That war
left us with an additional hundred millions of debt, and without
the colonies whose help had been represented as indispensable.
Again England was given over; and again the strange patient
persisted in becoming stronger and more blooming in spite of all
the diagnostics and prognostics of State physicians. As she had
been visibly more prosperous with a debt of a hundred and forty
millions than with a debt of fifty millions, so she, as visibly
more prosperous with a debt of two hundred and forty millions
than with a debt of a hundred and forty millions. Soon however
the wars which sprang from the French Revolution, and which far
exceeded in cost any that the world had ever seen, tasked the
powers of public credit to the utmost. When the world was again
at rest the funded debt of England amounted to eight hundred
millions. If the most enlightened man had been told, in 1792,
that, in 1815, the interest on eight hundred millions would be
duly paid to the day at the Bank, he would have been as hard of
belief as if he had been told that the government would be in
possession of the lamp of Aladdin or of the purse of Fortunatus.
It was in truth a gigantic, a fabulous debt; and we can hardly
wonder that the cry of despair should have been louder than ever.
But again that cry was found to have been as unreasonable as
ever. After a few years of exhaustion, England recovered herself.
Yet, like Addison's valetudinarian, who continued to whimper that
he was dying of consumption till he became so fat that he was
shamed into silence, she went on complaining that she was sunk in
poverty till her wealth showed itself by tokens which made her
complaints ridiculous. The beggared, the bankrupt society not
only proved able to meet all its obligations, but, while meeting
those obligations, grew richer and richer so fast that the growth
could almost be discerned by the eye. In every county, we saw
wastes recently turned into gardens; in every city, we saw new
streets, and squares, and markets, more brilliant lamps, more
abundant supplies of water; in the suburbs of every great seat of
industry, we saw villas multiplying fast, each embosomed in its
gay little paradise of lilacs and roses. While shallow
politicians were repeating that the energies of the people were
borne down by the weight of the public burdens, the first journey
was performed by steam on a railway. Soon the island was
intersected by railways. A sum exceeding the whole amount of the
national debt at the end of the American war was, in a few years,
voluntarily expended by this ruined people in viaducts, tunnels,
embankments, bridges, stations, engines. Meanwhile taxation was
almost constantly becoming lighter and lighter; yet still the
Exchequer was full. It may be now affirmed without fear of
contradiction that we find it as easy to pay the interest of
eight hundred millions as our ancestors found it, a century ago,
to pay the interest of eighty millions.

It can hardly be doubted that there must have been some great
fallacy in the notions of those who uttered and of those who
believed that long succession of confident predictions, so
signally falsified by along succession of indisputable facts. To
point out that fallacy is the office rather of the political
economist than of the historian. Here it is sufficient to say
that the prophets of evil were under a double delusion. They
erroneously imagined that there was an exact analogy between the
case of an individual who is in debt to another individual and
the case of a society which is in debt to a part of itself; and
this analogy led them into endless mistakes about the effect of
the system of funding. They were under an error not less serious
touching the resources of the country. They made no allowance for
the effect produced by the incessant progress of every
experimental science, and by the incessant efforts of every man
to get on in life. They saw that the debt grew; and they forgot
that other things grew as well as the debt.

A long experience justifies us in believing that England may, in
the twentieth century, be better able to bear a debt of sixteen
hundred millions than she is at the present time to bear her
present load. But be this as it may, those who so confidently
predicted that she must sink, first under a debt of fifty
millions, then under a debt of eighty millions then under a debt
of a hundred and forty millions, then under a debt of two hundred
and forty millions, and lastly under a debt of eight hundred
millions, were beyond all doubt under a twofold mistake. They
greatly overrated the pressure of the burden; they greatly
underrated the strength by which the burden was to be borne.

It may be desirable to add a few words touching the way in which
the system of funding has affected the interests of the great
commonwealth of nations. If it be true that whatever gives to
intelligence an advantage over brute force and to honesty an
advantage over dishonesty has a tendency to promote the happiness
and virtue of our race, it can scarcely be denied that, in the
largest view, the effect of this system has been salutary. For it
is manifest that all credit depends on two things, on the power
of a debtor to pay debts, and on his inclination to pay them. The
power of a society to pay debts is proportioned to the progress
which that society has made in industry, in commerce, and in all
the arts and sciences which flourish under the benignant
influence of freedom and of equal law. The inclination of a
society to pay debts is proportioned to the degree in which that
society respects the obligations of plighted faith. Of the
strength which consists in extent of territory and in number of
fighting men, a rude despot who knows no law but his own childish
fancies and headstrong passions, or a convention of socialists
which proclaims all property to be robbery, may have more than
falls to the lot of the best and wisest government. But the
strength which is derived from the confidence of capitalists such
a despot, such a convention, never can possess. That strength,--
and it is a strength which has decided the event of more than one
great conflict,--flies, by the law of its nature, from barbarism
and fraud, from tyranny and anarchy, to follow civilisation and
virtue, liberty and order.

While the bill which first created the funded debt of England was
passing, with general approbation, through the regular stages,
the two Houses discussed, for the first time, the great question
of Parliamentary Reform.

It is to be observed that the object of the reformers of that
generation was merely to make the representative body a more
faithful interpreter of the sense of the constituent body. It
seems scarcely to have occurred to any of them that the
constituent body might be an unfaithful interpreter of the sense
of the nation. It is true that those deformities in the structure
of the constituent body, which, at length, in our own days,
raised an irresistible storm of public indignation, were far less
numerous and far less offensive in the seventeenth century than
they had become in the nineteenth. Most of the boroughs which
were disfranchised in 1832 were, if not positively, yet
relatively, much more important places in the reign of William
the Third than in the reign of William the Fourth. Of the
populous and wealthy manufacturing towns, seaports and watering
places, to which the franchise was given in the reign of William
the Fourth, some were, in the reign of William the Third, small
hamlets, where a few ploughmen or fishermen lived under thatched
roofs; some were fields covered with harvests, or moors abandoned
to grouse; With the exception of Leeds and Manchester, there was
not, at the time of the Revolution, a single town of five
thousand inhabitants which did not send two representatives to
the House of Commons. Even then, however, there was no want of
startling anomalies. Looe, East and West, which contained not
half the population or half the wealth of the smallest of the
hundred parishes of London, returned as many members as
London.372 Old Sarum, a deserted ruin which the traveller feared
to enter at night lest he should find robbers lurking there, had
as much weight in the legislature as Devonshire or Yorkshire.373
Some eminent individuals of both parties, Clarendon, for example,
among the Tories, and Pollexfen among the Whigs, condemned this
system. Yet both parties were, for very different reasons,
unwilling to alter it. It was protected by the prejudices of one
faction and by the interests of the other. Nothing could be more
repugnant to the genius of Toryism than the thought of destroying
at a blow institutions which had stood through ages, for the
purpose of building something more symmetrical out of the ruins.
The Whigs, on the other hand, could not but know that they were
much more likely to lose than to gain by a change in this part of
our polity. It would indeed be a great mistake to imagine that a
law transferring political power from small to large constituent
bodies would have operated in 1692 as it operated in 1832.

In 1832 the effect of the transfer was to increase the power of
the town population. In 1692 the effect would have been to make
the power of the rural population irresistible. Of the one
hundred and forty-two members taken away in 1832 from small
boroughs more than half were given to large and flourishing
towns. But in 1692 there was hardly one large and flourishing
town which had not already as many members as it could, with any
show of reason, claim. Almost all therefore that was taken from
the small boroughs must have been given to the counties; and
there can be no doubt that whatever tended to raise the counties
and to depress the towns must on the whole have tended to raise
the Tories and to depress the Whigs. From the commencement of our
civil troubles the towns had been on the side of freedom and
progress, the country gentlemen and the country clergymen on the
side of authority and prescription. If therefore a reform bill,
disfranchising small constituent bodies and giving additional
members to large constituent bodies, had become law soon after
the Revolution, there can be little doubt that a decided majority
of the House of Commons would have consisted of rustic baronets
and squires, high Churchmen, high Tories, and half Jacobites.
With such a House of Commons it is almost certain that there
would have been a persecution of the Dissenters; it is not easy
to understand how there could have been an union with Scotland;
and it is not improbable that there would have been a restoration
of the Stuarts. Those parts of our constitution therefore which,
in recent times, politicians of the liberal school have generally
considered as blemishes, were, five generations ago, regarded
with complacency by the men who were most zealous for civil and
religious freedom.

But, while Whigs and Tories agreed in wishing to maintain the
existing rights of election, both Whigs and Tories were forced to
admit that the relation between the elector and the
representative was not what it ought to be. Before the civil wars
the House of Commons had enjoyed the fullest confidence of the
nation. A House of Commons, distrusted, despised, hated by the
Commons, was a thing unknown. The very words would, to Sir Peter
Wentworth or Sir Edward Coke, have sounded like a contradiction
in terms. But by degrees a change took place. The Parliament
elected in 1661, during that fit of joy and fondness which
followed the return of the royal family, represented, not the
deliberate sense, but the momentary caprice of the nation. Many
of the members were men who, a few months earlier or a few months
later, would have had no chance of obtaining seats, men of broken
fortunes and of dissolute habits, men whose only claim to public
confidence was the ferocious hatred which they bore to rebels and
Puritans. The people, as soon as they had become sober, saw with
dismay to what an assembly they had, during their intoxication,
confided the care of their property, their liberty and their
religion. And the choice, made in a moment of frantic enthusiasm,
might prove to be a choice for life. As the law then stood, it
depended entirely on the King's pleasure whether, during his
reign, the electors should have an opportunity of repairing their
error. Eighteen years passed away. A new generation grew up. To
the fervid loyalty with which Charles had been welcomed back to
Dover succeeded discontent and disaffection. The general cry was
that the kingdom was misgoverned, degraded, given up as a prey to
worthless men and more worthless women, that our navy had been
found unequal to a contest with Holland, that our independence
had been bartered for the gold of France, that our consciences
were in danger of being again subjected to the yoke of Rome. The
people had become Roundheads; but the body which alone was
authorised to speak in the name of the people was still a body of
Cavaliers. It is true that the King occasionally found even that
House of Commons unmanageable. From the first it had contained
not a few true Englishmen; others had been introduced into it as
vacancies were made by death; and even the majority, courtly as
it was, could not but feel some sympathy with the nation. A
country party grew up and became formidable. But that party
constantly found its exertions frustrated by systematic
corruption. That some members of the legislature received direct
bribes was with good reason suspected, but could not be proved.
That the patronage of the Crown was employed on an extensive
scale for the purpose of influencing votes was matter of
notoriety. A large proportion of those who gave away the public
money in supplies received part of that money back in salaries;
and thus was formed a mercenary band on which the Court might, in
almost any extremity, confidently rely.

The servility of this Parliament had left a deep impression on
the public mind. It was the general opinion that England ought to
be protected against all risk of being ever again represented,
during a long course of years, by men who had forfeited her
confidence, and who were retained by a fee to vote against her
wishes and interests. The subject was mentioned in the
Convention; and some members wished to deal with it while the
throne was still vacant. The cry for reform had ever since been
becoming more and more importunate. The people, heavily pressed
by taxes, were naturally disposed to regard those who lived on
the taxes with little favour. The war, it was generally
acknowledged, was just and necessary; and war could not be
carried on without large expenditure. But the larger the
expenditure which was required for the defence of the nation, the
more important it was that nothing should be squandered. The
immense gains of official men moved envy and indignation. Here a
gentleman was paid to do nothing. There many gentlemen were paid
to do what would be better done by one. The coach, the liveries,
the lace cravat and diamond buckles of the placeman were
naturally seen with an evil eye by those who rose up early and
lay down late in order to furnish him with the means of indulging
in splendour and luxury. Such abuses it was the especial business
of a House of Commons to correct. What then had the existing
House of Commons done in the way of correction? Absolutely
nothing. In 1690, indeed, while the Civil List was settling, some
sharp speeches had been made. In 1691, when the Ways and Means
were under consideration, a resolution had been passed so
absurdly framed that it had proved utterly abortive. The nuisance
continued, and would continue while it was a source of profit to
those whose duty was to abate it. Who could expect faithful and
vigilant stewardship from stewards who had a direct interest in
encouraging the waste which they were employed to check? The
House swarmed with placemen of all kinds, Lords of the Treasury,
Lords of the Admiralty, Commissioners of Customs, Commissioners
of Excise, Commissioners of Prizes, Tellers, Auditors, Receivers,
Paymasters, Officers of the Mint, Officers of the household,
Colonels of regiments, Captains of men of war, Governors of
forts. We send up to Westminster, it was said, one of our
neighbours, an independent gentleman, in the full confidence that
his feelings and interests are in perfect accordance with ours.
We look to him to relieve us from every burden except those
burdens without which the public service cannot be carried on,
and which therefore, galling as they are, we patiently and
resolutely bear. But before he has been a session in Parliament
we learn that he is a Clerk of the Green Cloth or a Yeoman of the
Removing Wardrobe, with a comfortable salary. Nay, we sometimes
learn that he has obtained one of those places in the Exchequer
of which the emoluments rise and fall with the taxes which we
pay. It would be strange indeed if our interests were safe in the
keeping of a man whose gains consist in a percentage on our
losses. The evil would be greatly diminished if we had frequent
opportunities of considering whether the powers of our agent
ought to be renewed or revoked. But, as the law stands, it is not
impossible that he may hold those powers twenty or thirty years.
While he lives, and while either the King or the Queen lives, it
is not likely that we shall ever again exercise our elective
franchise, unless there should be a dispute between the Court and
the Parliament. The more profuse and obsequious a Parliament is,
the less likely it is to give offence to the Court. The worse our
representatives, therefore, the longer we are likely to be cursed
with them.