THE TAXATION OF FRANCE.
THAT the national credit of France is in any serious
danger, we do not believe. That credit rests upon a rock, the social system of France, which survives all Revolu- tions, and under which the body of the people have become possessed, not only of their own soil, but of the bulk of the paper securities, national and other, in which the savings of all European countries, once hoarded in cash and valuables, are now invested. The National Assembly could not now repudiate, and we doubt if it could heavily tax the Debt, without immediate overturn. Even when Thiers was so tempted to make the payment of ransom impossible, repudia- tion was not seriously thought of. The Bondholders have the bayonets, and the very idea of repudiation appears to have passed out of the heads even of the Red statesmen, though we are by no means certain that they are cured of the old crazes about inconvertible paper. The people, owning the securities, have become submissive to taxation, and pay the heavy demands on them not only without resistance, but with- out placing any visible pressure on their representatives to enforce economy. It may be taken as assured that the French will pay while they are able, and of any serious decline in their ability there is no trace. They are harassed by bad harvests, as we have been, and by the phylloxera, as we have been by the foot-and-mouth disease, and they have lost money by over-speculation, as we do occasionally, but still they are saving, though in a diminished volume ; the population, though stationary, is not declining, the exceeding attractiveness of France to German, Italian, and Spanish working-men, making up for all losses ; and the taxes, heavy though they are, still come in. That fatal signal, that taxation ceases to draw, is absent from French finance. There is a fluctuation in receipts now and again, as there is even in Great Britain ; but M. Tirard reports that last year £121,000,000 sterling reached the Treasury, and this although there is undoubtedly considerable laxity in certain branches of collection. The alarm now so generally manifested as to French finance is due in the main not to any failure either of desire to pay or ability to pay, but to over-rapid drafts upon the surplus savings of the country. The French peasantry put much of their savings into the soil, in small purchases of land at extra- vagant rates, in elaborate and costly protection for their vines, and in improved culture generally, and the residuary hoard has been drawn upon lately very lavishly. The Government has been in the market, the Railway Companies have been in the market, and the great financing associations have been in the market, till all Bonds have fallen seriously, and the Government is compelled, in order to tempt the peasantry, to emit Rentes seven points in the hundred cheaper than before. The loan of this week is issued at 76.60, and is redeemable at par on any day before 1953. That is to say, the French Treasury is now paying, when the redeemability of its last loan is taken into consideration, at least 1Q per cent, more for money than the British, which, considering the comparative safety of the investment in both countries, ought not to be the case. The national credit is in no danger, but the national ability to borrow at home is temporarily restricted, and there is a glut of investments, just as there might be of coals.
Nevertheless, France is suffering from taxation. The pea- sant can bear a good deal, for he pays little rent, and no money to lawyers, and light local rates, but still he is bearing a good deal. It is calculated that he pays at least half-a-crown in the pound of his earnings to the State, besides one-tenth of his whole time of gainful labour ; and that is a heavy burden, equal probably, when taxation and conscription are taken together, to a fifth of his earnings through life, more than the highest average ever assumed for the pressure of taxation upon the English lowest class. That is a large deduction from the general comfort, and a loss to France which can be better measured in another way. To assume that the labour of an average French worker is worth a hundred pounds a year is to take a high figure ; but assuming that as the fairest average, the State always expends in maintaining its own organisation a million and a quarter of adult males. It burdens itself, so to speak, with the maintenance of a standing army of a million and a quarter of men, paid at that very high rate. One- seventh of the entire male strength of France is always used up; in order that the State organisation may be kept going. Of course, this organisation is not all waste. Much of the labour expended is repaid, being labour on roads, bridges, and canals ; some repays itself, in the increased efficiency for the duties of life which conscripts should possess when they leave the Army or Navy ; and a little must be set down to direct education, which is in the long-run remunerative ; but still the burden is a heavy one for a nation to stagger under, and thus viewed, makes economy seem very peremptory. Every extra million expended annually by the State in non-productive work is an addition of ten thousand men voted to the Army of the State, and voted away from "reproductive labour, the sole source of wealth. It would be very difficult to get the vote, if it were expressed in men ; but expressed in money, it .is voted readily enough, sometimes for very useless or even injurious purposes. Nor do we see much sign that such votes will become unpopular. Nothing in political economy has been so imperfectly explained as the decrease in the old horror of taxation, which- once moved nations to fury and precipitated revolutions, but now seems hardly to affect the general feeling at all. Much of the change is, no doubt, due to improved methods, the old taxation re- sembling plunder much too visibly, and rousing the hatred and fear which we still see in countries like Turkey, where a taxation, light in the aggregate, is so arranged as to make accumulation hopeless ; but there is another cause. The people in Western Europe are positively wealthier, and taxa- tion strips them of their surplus, rather than of their actual food and clothing. The taxpayer gives up his savings, but not his dinner. The difference is immense, and, combined with the rise of the entirely modern feeling that a man ought to be fined for consuming alcohol—a notion which would have struck a Roman or a Greek either as an absurdity or as a refined oppres- sion—has not only diminished popular bitterness about taxes, but has made experiments possible in taxation which our fathers would have thought quite monstrous. In almost all countries, the tendency to spend money and borrow money on State or Municipal account increases, till economists grow alarmed, and predict that some day there will be a general liqui- dation. There may be, for the desire to be materially happy is rising everywhere into a passion, but the liquidation may be very far off. The tax-gatherer of to-day is a long way from being the stripper he was among our forefathers. We think Frenchmen heavily burdened, and so they are ; but there is much evidence to show that in 1816-21, the five years follow- ing the great war, the English State and the English landlords together took from the labouring classes twice the propor- tion now taken in France, and this at a time when the labourers' margin above the coat of bare food was far less than at present. Yet though revolt was very near, and bread riots did occur, the "ugly rush" never happened. We none of us know what mankind will bear, in the way of pecuniary de- mands, so long as the demands increase slowly, and do not directly interfere with the supply of food, and seem, as in France, to protect the savings of great classes of the people. If the great European war so often threatened really occurs, and is at all protracted, we may yet see nations submissively enduring the devotion of a third of all earnings to the service of the State, and so proud of their history that any proposals to repudiate would be rejected with scorn. French taxation is already doable what it was in 1867, though neither soil nor numbers have changed ; and if it were doubled again, we are not certain that the burden would be shaken violently off. The savings would be less, the industry greater, the economies more severe, and the nation would stagger on with that enduring patience which, in spite of the spread of Socialist opinions, is the new feature of the European tax- payer.. He frets, and he asks everywhere that the State should carry the burden, and not the Commune—in other words, that he should pay indirectly, not directly, should be bled, and not bludgeoned—but he does not revolt. Even when he is hungry, as in Paris, he asks for work, not for less expenditure ; and when, as in Berlin, he is relieved of income-tax, but his wage-payer is ordered to contribute the difference, he accepts the change as a gift, and never urges that both might with more effect be relieved by reductions in expenditure. If Joseph Hume were to revisit earth, the British Budget would not appal him half so much—though we fear it would kill him—as the British indifference to its amount.
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