СНАР. 1816. The rapid fall of prices necessarily spread consternation among the manufacturing classes; and the manufacturers had another reason for serious apprehension. By the terms of the Bank Restriction Act of 1797 cash payments Cash payhad been suspended during the continuance of the war ments. and for six months afterwards. The conclusion of peace suggested the probability of their resumption; and the bare possibility of such a result was sufficient to alarm the most sober mind. During the earlier years of the war the price of gold had not been materially affected by the issue of inconvertible paper; but its price was seriously raised during the later years of the struggle. In 1810 gold was quoted at 81. 7s. 8d. per cent. premium; in 1811 at 201. 28. 7d. per cent.; in 1812 at 25l. 16s. 8d. per cent. ; in 1813 at 291, 4s. 1d. per cent. The premium fell in 1814, with the first return of peace, to 14l. 78. 7d. It fell in 1815 to 137. 9s. 6d. Every commercial operation was necessarily disturbed by these sudden variations. Every commercial operation had been calculated on the hypothesis that gold, which was continually rising in value, would go on rising. It suddenly fell. The price of every article had been increased with the rise in the value of gold. The price of every article fell with the fall in its value. A merchant had imported large quantities of goods, and had contemplated disposing of them at 10 per cent. profit. The mere change in the value of the currency caused prices to drop 15 per cent. Instead of a gain of 10 per cent. he had incurred a loss of 5 per cent. As a matter of fact the drop was in most cases very much greater. The rise in prices generally exceeded the rise in the price of gold. The fall in the value of gold was less than the fall in the value of other commodities. the world. The price of copper fell, at the conclusion of the war, from 180l. to 80l. per ton; that of iron from 201. to 81., that of hemp from 118. to 347.; and other commodities were affected, not to the same but to a СНАР. V. 1816. Attitude of the Ministry. The property tax. These considerations, obvious as they appear now, do not seem to have occurred to any member of the cabinet. Intoxicated with the glories of the war, ministers closed their eyes to every appearance of difficulty, and refused to see, in the surrounding gloom, any indications of distress. Parliament had never had more important duties to perform; yet its meeting had never been postponed to so late a period. The Irish members were unable to come to Westminster, detained by the ' pecuniary distress and partial disturbance' which were apparent in Ireland. Yet the Regent was advised to congratulate the Legislature on the flourishing condition' of the manufactures, commerce, and revenues of the kingdom.' The country was anxiously expecting relief, but the ministry was determined to prefer the reduction of debt to the remission of taxation. Neither the distress of the agricultural classes nor the wholesale executions, by which Irish discontent was being stamped out, induced them to turn from their settled policy.1 The property tax was the most unpopular of the imposts which the war had necessitated. It had been first imposed by Pitt in 1799, after the failure of his plan for trebling the assessed taxes. In its original shape it was a duty of 10l. per cent. on all incomes of more than 2007. a year, and a graduated duty of a smaller amount on incomes of less than 2001. but of more than 60%. The tax yielded rather more than 6,000,000l. a year, or about 250,000l. for every penny. It expired at the peace of Amiens, but it was revived in 1803, after the fresh outbreak of hostilities. In 1803 the tax was collected in a new way. The tenant was compelled to advance the tax for his landlord, the mortgagee for the mortgagor. The new system of collection proved very advantageous. A five per cent. tax in 1803 proved almost as productive as the 1 Romilly, vol. iii. p. 213. Hansard, vol. xxxii. pp. 2, 63. Liverpool, vol. ii. p. 249. old ten per cent. duty. The necessities of the war, however, compelled the Government to increase their resources. The property tax was doubled by the Talents administration, and, from 1806 till after the peace, was continued at a ten per cent. rate. The taxpayers expected that the conclusion of peace would relieve them at once from contributing to an impost which was intolerably heavy. The tax had always been regarded as a war tax; the conclusion of peace seemed the natural and appropriate period for dispensing with it altogether.1 The ministry, however, regarded the matter from a very different point of view. The property tax yielded a substantial revenue of 15,000,000l. a year; and it required some courage to dispense with a source of income which was so large and so convenient. They had the responsibility of providing for the national expenditure, and it was no easy matter to see how the task could be fulfilled if they were suddenly deprived of the most productive portion of their income. The expenditure of the year, as it was ultimately approved by Parliament, amounted to no less than 66,581,2951.2 The income of the year, without the property tax, could not be placed 1 p. 184. Report of Commissioners of Inland Revenue, 1870, vol. i. p. 120; vol. ii. 2 * Debt, Sinking Fund, and Civil List £ СНАР. V. 1816. СНАР. V. 1816. The estimates at tacked, but at more than 52,365,000l. There was, indeed, a surplus of about 6,000,000l. in the Exchequer, which was capable of being applied to the service of the year. But, under no circumstances, was it possible to place the available supplies at more than 58,470,000l. It was obvious, therefore, that the repeal of the property tax would involve a deficit of more than 8,000,000l. Vansittart and his colleagues were not prepared to face this deficiency. They were ready to reduce the property tax by one-half, but they were not disposed to dispense with it altogether. As the ten per cent. property tax yielded 15,000,000l., a five per cent. tax could obviously be relied on to produce 7,500,000l. A sum of 7,500,000l. was very nearly the exact amount of the estimated deficit. At the very outset of the session, then, the ministry found itself opposed to the wishes of the country. The agreed to. ministry had decided to retain the property tax at half its former rate; the country was bent on dispensing with the tax altogether. The Opposition, in both Houses of Parliament, naturally adopted the views of the country, 1816. and insisted on attention being paid to the wishes of the СНАР. people. There were two ways by which this object could be secured. The tax, in the first place, might be simply abolished; the expenditure, in the next place, might be reduced to a point which would render the continuance of the tax unnecessary. The conclusion of the war, it was urged, ought to be followed by large reductions in the military and naval establishments; and the ministry were, on the contrary, contemplating the maintenance of both army and navy on a war footing, They asked for establishments of 33,000 seamen and 149,000 soldiers. One-third part of the military establishment, however, comprised no charge on the British revenues. 30,000 men, the Army of Occupation, were paid by France; 20,000 men by the East India Company. The residue, or 99,000 men, were borne on the home es tablishment. The first attacks of the Opposition were made on this establishment. In both houses of the legislature the attack was formidable. But the Government had a strong apology for the policy which they were pursuing. It was not easy to prove that any portion of the 99,000 men, whom they desired to retain, could be safely spared. 25,000 men were required in Great Britain; 25,000 in Ireland; 23,800 in the old colonies; 22,200 in the new colonies; and 3,000 as a reserve for colonial reliefs. The force intended for the new colonies was one-third smaller than that which the powers, from whom they had been captured, had maintained in them. The force intended for the old colonies was only one-third larger than that with which they had been garrisoned in 1791. The force at home only exceeded by 7,000 men the numbers which had been thought necessary before the war. The most sanguine economist could, however, hardly pretend that the force which was sufficient in 1791 would be adequate in 1816. 1 Ann. Reg., 1816, Hist., pp. 6, 7. |