GREAT BRITAIN AND WAR DEBTS
[To the Editor of THE SPECTATOR.]
Sus,—I should like to draw attention to an episode in our history which makes an interesting parallel to the present question of our Debt to America. Great Britain, in the case of which I am speaking, was the creditor nation, Austria the debtor.
During the Napoleonic Wars the British Government furnished considerable financial aid to the various Allied Powers. This usually took the shape of subsidies, but Austria considered this form of assistance derogatory to the Imperial dignity and insisted on borrowing the money. Two loans were accordingly issued, the first in 1795 and another two years later.
After the final overthrow of Napoleon the question of repay- ment arose, and it was found that the principal and interest of the loans now amounted to 14 millions sterling. This was a sum far beyond the capacity of Austria, in her impoverished financial condition, to meet, and the British Government, prompted by Castlereagh, who was anxious to keep on friendly terms with Metternich, would have been willing to cancel the whole debt or accept some nominal equivalent. But the attitude of Parliament made this concession impossible. Questions had been asked in the House from 1816 onwards, and attacks by the Opposition became especially violent in 1821, when the Laibach Conference further increased the un- popularity of Austria in this country. Castlereagh was conse- quently obliged to open negotiations with Metternich for a settlement, and these dragged on for some years. Finally, but not till a year after Castlereagh's death, the matter was settled by the payment of £2,500,000.
Professor Webster, to whose well-known study of the Foreign Policy of Castlereagh I am indebted for the facts, is of opinion that the British Government treated Austria rather shabbily. He adds—" Had the sums been larger, much damage might have been done, not only to Europe, but also to the reputation and material interests of Britain herself." It is to be hoped that Congress may eventually be persuaded to take this view of the present question. In any case, the general analogy, with the American Government for the British and Congress for the House of Commons, is curiously close and, incidentally, not uninstructive.—I am, Sir, &c., ARNOLD C. TAYLOR.
88 Brunswick Square, Hove, Sussex.
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