LETTERS TO THE EDITOR.
REDUCTION OF THE NATIONAL DEBT. [To ram Eorror or Tar SFACTATOR.")
Bra,—Notwitlistanding the weight which every one must recog- nise in Mr. Goschen's arguments, it seems to me that the reasons against departing from Sir Stafford Northcote's plan for the reduction of debt are of overwhelming force. Some of these reasons may be summarised as follows :-
1. The value of gold is steadily rising, and the process is likely to continue. Suppose the rate of appreciation to be I per cent, per annum (no extravagant supposition), the un- perceived increase of the capital of our Debt due to this course would be three and a half millione in each year. In other words, although under the new arrangement we should be nominally pay- ing off five millions, the real pressure of debt would be lightened only to the extent of one and a half millions per annum.
2. One of England's chief securities against attack is that she is known to possess an immense reserve of strength. Every million of debt paid off increases that reserve, and propor- tionately increases her security. If Sir Stafford Northcote's scheme were adhered to, in twenty years' time we should have cleared off nearly fifty millions of debt beyond what we shall clear off under the new arrangement.
3. By resolute adherence to Sir Stafford Northcote'e figure, it is probable that in a few years' time we should be able (as pointed out by Sir John Lubbock) to reduce the interest on debt to 2I per cent., thus saving three millions per annum, which sum would be available for further redemption of debt or for reduction of taxation.
4. The example of encroaching on the figure fixed by Sir Stafford Northcote once set, it is to be feared that future Chancellors of the Exchequer would be unable to resist the temptation of earning popularity by farther operations in the same direction. I do not say, or think, that desire to produce a popular Budget has in any degree actuated Mr. Goschen ; but we may not always be fortunate enough to secure Chancellors of the Exchequer as high-minded as he.
5. There has been no pressure of any sort necessitating a change. The pnblic were prepared to continue, without mur- muring, the sacrifices required by Sir Stafford Northcote'e plan, and no one in the least degree anticipated that that plan was likely to be departed from.—I am, Sir, &c., J.
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