THE TWO FINANCIAL DEBATES.
THE Session seems likely to be more remarkable for bring- ing out the weaknesses of the leading men in the House, than for exhibiting the strong side of either Liberal or Tory leaders. Monday night was unquestionably a trying night for the Government, while Tuesday's debate was not at all a cheering one for the leaders of Opposition. Each front bench in turn exhibited its little failings, while the total effect of the two financial battles was perhaps to diminish the con- fidence of the House both in the capacity of its Ministers and in the impartiality of their official critics. Of the two failures, however, that of the Chancellor of the Exchequer was certainly the most serious. The duty of picking holes has, unfortunately, been so carefully inculcated on Her Majesty's Opposition, and so anxiously discharged by every Opposition in its turn, that Opposition leaders have almost lost the power of looking with a certain magnanimous impartiality at what their opponents do, and of trying it by standards such as they would think it right to apply to their own
acts. Hence we always expect a little more cavilling and carping than is at all desirable in the conduct of Opposition, and ought to feel rather regret than surprise in having our expectations verified. But we do not expect to find a man as clear-headed and sagacious as Sir Stafford Northcote getting himself into so hopeless a slough of despond as that in which he floundered about on Monday, and then almost losing his temper with his adversaries when they ventured to rally him on taking back with one hand what he had given with the other. What happened on Monday night was really this. Sir Stafford Northcote's proposal to blend the two Savings- bank Accounts and the Friendly Societies' Account was opposed by Mr. Childers, who moved an amendment the object of which was to keep the details of these accounts separately before the Houses,—a most important point in order to enable Parliament to determine what policy in relation to the three separate modes of dealing with savings on which the Government allow interest, should be adopted in future. Sir Stafford Northcote, however, opposed this amend- ment, asking what reason there was for keeping these accounts separate which did not equally exist for keeping separate the individual deposit account of every separate Society which places its balance with the Go- vernment,—a question which might have been answered by another, namely, what astronomical reason there is for calcu- lating distinctly the orbit of each planet, which does not also exist for calculating separately the orbit of each particle of which it is composed. Sir Stafford Northcote must have known perfectly well that the use of rendering separate ac- counts to Parliament ceases where the terms on which the State treats those accounts cease to be distinct, but not before. If it be true that excessive rates of interest have been accorded to some Friendly Societies and no more than reasonable rates to others, then in those cases it has been no doubt a very objectionable course to muddle up the unremunerative with the remunerative accounts;. but it is a very bad reason for extending a policy of confusion, that we have indulged ourselves in a little confu- sion already. But no sooner did Mr. Goschen, and Mr. Glad- stone, and Mr. Lowe, and Mr. Dodson, and various other autho- rities point out that to render clear and distinct accounts of the various transactions was of the very essence of any conceivable reform in the future, than Sir Stafford North- cote withdrew from his position that the three accounts should be really and permanently fused, declared that nothing could have been farther from his intention than any idea of keeping Parliament in the dark as to what was going on, and expressed his perfect willingness to render a separate account of the three classes of transactions to any one who chose to inquire for it. Well, that is very satisfactory as far as it goes, only one does not see what all the fuss had been about. If there is no wish to hoodwink any one, if the loss or very narrow gain on the old Savings-banks, and the great profit on the Post- office Savings-banks, are to be published to all the world in the future as in the past, and the only object of the common account is to make the profits of the new bank- ing system available for the extinction of the debts caused by the old banking system, nobody is at all likely to object, —especially as, do what you will, you cannot help knew- ing that cash slipped into one pocket must be available for paying the bills which have accumulated in another pocket. The only point of interest in the debate was the apparent wish to make it impossible for Parliament at any future time to com- pare the prosperity of one system with the failure of another. If that is given up, all is given up. Sir Stafford Northcote, under much pressure, was compelled to admit, first that he should be quite willing to reduce the rate of interest to the old Savings-banks, and to increase that paid to the Post-Office Savings-banks, if good cause for such a change could be shown; and next, that the data for deciding on the policy of such a step should be as carefully kept for the future as they had been for the past ;—after which admissions it becomes very diffi- cult to see what the object of the Bill in these respects really remains As far as we can see, it is only this :—To justify the Chancellor of the Exchequer in saying that the deficit caused by the Savings-banks transactions is in course of liquidation, though nothing more has been done to effect that liquidation than to give the Government the right of transferring in imagination to the hole made in one place, the heap growing up in another. If nothing at all had been done, the old Savings-bank de- ficiency would have gone on growing, and the Post-Office Savings- bank surplus would also have gone on growing. But now (in one account at least) the Government statement, instead of showing the growing debt and the more rapidly growing store, will show a diminishing debt. Surely that is a great deal of cry about very little wooL It is difficult to believe that, originally at least, the Savings-banks Bill was not meant to do a good deal more than this,—namely, to militate against any reduction of the terms given to the Old Savings- banks, and any demand for the increase of the terms given to the New Savings-banks. But if this was the real object, the beneficently destructive criticism of the Opposition nipped the manceuvre in the bud, and reduced the chief provision of the Savings-banks' Bill to a nullity, or at least to the mere grant of a permission to use one set of rather unreal expressions in one division of the public accounts, without disguising the real facts which are to come out just as before, though in another and less conspicuous shape. We may remark that the discussion of the whole transaction so visibly damaged the Government, that its majority fell for the filet time as low as thirty-eight, on the question of going into committee on the Bill.
On Tuesday, however, the scales turned, and Sir Stafford Northcote had the satisfaction, if it were a satisfaction, of see- ing his opponents look like cavillers, while he represented the desire and resolve of the House to attack the re- duction of the Debt in a manly and straightforward fashion. And yet no doubt there was an unfortunate oddity in his position. For a Minister whose nominal surplus is not equal to the demands upon it, to propose the initiation of a great scheme for the reduction of Debt has, to say the least, something a little inappropriate in it. When Sir S. Northcote hinted, what, indeed, he virtually asserted, that his actual surplus would be larger than he had ventured to call it, Mr. Gladstone reproached him for not presenting the House with a properly considered estimate of his resources ; but so far as he withdrew from that position, he was told that the £185,000 he proposed to devote to the payment of Debt is only a bill drawn on the bank of hope, and not a proper element
in a Budget at all. And no doubt the truth is that Sir Stafford Northcote would have been in a more tenable position if he had estimated for a larger surplus than he did,—a surplus large enough to cover all he proposes to do ; for his real expectation evidently is that he will have enough, and more than enough, to cover all he proposes to do. Still this error is a trifling error in form, very excusable in a Chancellor of the Exchequer rather new to his work ; nor was it very lenerous of Mr. Gladstone to press him so hard on this trivial point. For the rest, the hostile criticism of his plans seems to us wholly unreasonable. It is absurd to say that the proposal to devote a given revenue to the payment of interest and the repayment of principal for an indefinite term of years, is a bit more objection- able than the proposal to add, for a fixed term of years, to the in- terest paid on the debt, a sum of fixed value for the repayment of principal, which is what is done when perpetual annuities are turned into terminable annuities. In either case alike, future Chancellors of the Exchequer are called upon to fulfil obliga- tions entered into under circumstances which may be very unlike the circumstances under which these obligations must be ful- filled. In either case alike, the obligation so undertaken may, for sufficient cause, be repudiated. Parliament may, if it pleases, reconvert terminable annuities into perpetual annuities, in order to diminish the pressure on the revenue. And so Parliament may, if it likes, diminish in some future year the fixed sum of £28,000,000, which Sir Stafford Northcote pro- poses to set apart for the joint purpose of paying interest and repaying the principal of the Debt. But is it a wise or a truly Liberal policy, instead of trying to support Sir Stafford Northcote's wise proposals, to begin anticipating and almost encouraging the application of pressure to him or to one of his successors to withdraw these proposals? The success or failure of the Chancellor of the Exchequer's scheme depends in no small degree on the personal influence exerted by the leading men of both parties. If the Liberal statesmen do all in their power to support the proposal of the Conservatives, there is no reason why the plan should not be a great success. If they almost suggest and invite popular resistance to these proposals, they do what is in their power to make them a failure. Surely it would have been •a far more magnanimous, as well as, in the long run, a far wiser policy, to lend their moral support to Sir Stafford Northcote, than to make light of his efforts. The House thought so, for Monday's small majority of 38 grew on Tuesday to no less than 67. And even if the House had not thought so, we think impartial critics would have regretted and condemned the deliberate attempt to weaken the force of the public opinion which favours doing something large towards repaying Debt. Mr. Gladstone says experience is against the plan ; well, but the ex- perience of one generation is not necessarily the experience of the next ; and after all, experience is made up of various elements, and one of these elements is statesmen's opinion. If we foster the opinion in favour of repaying Debt, our experience may reverse the lessons taught by the experience of our ancestors,—although if we gird and hammer away at that opinion, our experience may confirm theirs. On the whole, considering the relatively very light pressure on our commerce and our resources, our experience in this matter ought to be something different from the experience of the last generation ; and we shall feel really humiliated if it be in any way owing to the grudging conduct of the Liberal party that that happy result is not achieved.
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