THE CRISIS IN PORTUGAL.
PORTUGAL is a little State, but the financial crisis in Lisbon may, if it is prolonged, have a serious effect upon the general politics of Europe. It greatly exasperates the danger of the Monarchy, which has existed in a more or less acute form ever since the fall of the Empire in Brazil. The State, it is true, is not formally bankrupt, payment of interest on the Debt not having been suspended ; but the crash, which has caused the Government to decree a " moratorium," or period of delay in liquidating private claims, has rendered the diffi- culty of providing the half-yearly dividends almost in- superable. The money cannot be procured except from Paris, and the Parisian firms which agreed to lend it are hampered by the prostration of credit in Lisbon, and by the enormous fall in Portuguese Stock itself, with which they are loaded, the Three per Cents., which ought, by analogy with Spanish Two per Cents., to be worth 75, being saleable only below 43. It is evident, therefore, that financiers expect a great reduction of interest or a suspension of payments, which would add a finishing touch to difficulties . already so serious that both in Lisbon and Oporto it is 'difficult to get currency of any kind, that small depositors are steadily withdrawing and hoarding their money, and that a general lock-out, in despair of means to pay wages, is far from improbable. Telegrams are under a strict censorship, and the officials are as optimist as usual ; but in Madrid, where Portugal is studied with genuine interest, the economic situation is regarded as deplorable, and certain to have political results. It is true that States survive financial crashes with surprising ease, and are often, in spite of Carlyle, not destroyed by their own bankruptcy —Turkey, for example, was not seriously injured—but in Portugal the Monarchy itself is weak. For years past it has been the custom of its own people to attribute to it every disaster, and especially the condition of the finances, and for years past this has been so far true that its selections of Ministers have not been justified by success. The dynasty itself has been weak, and has not secured the services of any competent man able either to control Par- liament, or to make the administrative system reasonably efficient. Successive Ministers have allowed the mob to dictate their foreign policy, while the condition of the Colonial administration, which is the preoccupying interest of the Portuguese, is so bad, that if we gave some of the facts in our hands from official sources, we should be simply disbelieved. For example, the whole of the Portuguese dominion in East Africa about which such a fuss is made, is really a Black State without five hundred white men in the whole of it, troops included. The discontent in the two great cities is excessive, and is directed wholly against the Monarchy, which, in fact, is protected only by the Army, itself not really unanimous, and by the dread of the armed inter- ference of Madrid. Great social distress, consequent on the commercial crisis may, however, overcome this apprehen- sion ; and if a rising occurred, it might not be put down with the ease which characterised the last suppression of an omeute in Oporto. The King, described as far from a determined man, would hardly resolve to shell his capital'; and that extreme resource failing, the mob, it is said, might succeed in an insurrection, and even proclaim and obey a Republican Government. It is at this point, if it is ever reached, which would depend mainly on the resoluteness of the King, that events in Lisbon would begin to interest all Europe. It is said to be certain that the Government of Madrid neither would nor could tolerate a Republic in Portugal, and that view seems to be prima facie just. There is much Republican feeling of a kind in Spain, and much discontent in the cities ; and though the Queen-Regent is protected by the Army, and by the feeling of the lower classes in favour of the baby-Sovereign, her advisers do not desire to be even victorious in a civil war which, were Portugal Republican, would be constantly renewed, Lisbon becoming at once an asylum and a place of arms for the defeated Spanish Republicans. Seflor Canovas would, therefore, anticipate the danger by ordering Spanish troops to occupy Portugal, the more readily because there would be little fear of effective resistance. The Portuguese Army is not in good condition, while the far larger Spanish Army is; and though the people might be inclined to resist, neither the peasantry nor the city mobs can in our day offer much opposition to regular troops resolutely led. Such a move- ment, however, would be the letting out of waters. It is all very well to talk of " supporting the Bra.ganzas and then retiring ;" but a Spanish army could not march upon Lisbon, reseat King Carlos by force, and then march back again, leaving him exposed to the vengeance of the populace, and considered a traitor for having brought upon the country such a humiliation. The Portuguese think of themselves as if Europe had never advanced in the last three centuries, and would declare war on a Great Power to-morrow if their dignity were affronted. The occupation must continue, under one form or another ; Spain would dispose of the destinies of Portugal; and the system of Europe would be visibly disturbed. The French would like neither the aggran- disement of Spain, the invasion of a dependant of their own, nor the suppression of a Republic ; the Italians would begin, as they always do, quaking about their position in the Mediterranean ; while the British 'Government would see with displeasure a change in the proprietorship of ports almost essential to its fleet. Dangerous ambitions and jealousies begin to stir at such times, and England and France, or France and Spain, or Italy and France, might find themselves in collision, almost before their peoples were aware that any cause of disagreement had arisen. The danger, in fact, is so certain, that it would probably be prevented by secret communications, but that the key to the situation is not, unfortunately, in the hands of statesmen alone. The populace of Lisbon can precipitate a crisis if they will; and if the Govern- ment of Portugal is unequal to deal with it—and it is not only very weak, but strangely reluctant to act with vigour —the international disturbance is as certain to follow as effect on cause.
Nor must we blame that populace too much. It is ignorant, proud, and fierce ; and it is exasperating to see its Government too weak to succeed in anything, the finances in such disorder that crises are only staved off by the sale of the last great State asset, the tobacco monopoly, and every popular demand met by the explana- tion that, with five-sevenths of the revenue mortgaged to the payment of debt, any expenditure for anything beyond the barest necessaries is impossible. Broadly stated, the effective revenue of Portugal—we mean the revenue available for expenditure—is £7,000,000; and of that, the Debt, External, Internal, and Floating, absorbs £5,000,000, leaving the Government too little to provide for expenses like the Army, Navy, and Civil Service, which must be paid for first. Borrowing, almost daily borrowing, is a necessity ; and even when borrowing is possible, the State is in the position of a bankrupt landowner " dipped " till he cannot pay weekly wages or keep his roads up without his banker's help, which grows monthly more reluctant. Now that borrowing is stopped, the Govern- ment has no option except to decree a ," moratorium " for itself ; and we can scarcely wonder that a people dreading that—they hold half the total debt—feeling the pressure of the commercial crisis, and attributing both to reckless mismanagement, should be furiously angry with the dynasty, with the system of govern- ment, and with everybody, English merchants espe- cially, who, profiting by Portuguese trade, look on unhurt and audibly contemptuous. The English would be angry too under the same circumstances, but they would act ; and the Portuguese want to act too, but the only line of action they see open to them is to get rid of the dynasty, and try to manage for themselves. They may shrink at the last moment, or—which is probable enough, considering what modern shells mean—they may be beaten ; but the elements which produce revolution are clearly all piled up in Lisbon ready for the spark, and it will need decision somewhere, as well as judgment, to prevent an explosion.
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