TOPICS OF THE DAY.
THE PREMIER AND EGYPT.
DISRAELI will be drowned in the Nile, if he does not take care. The secret history of the extraordinary series of incidents in connection with Egypt which has marked the past month may possibly never be revealed, and certainly will not be revealed until the Premier has passed from the scene, but enough is known or suspected to produce a most un- favourable impression, either of the judgment or the courage of the Ministry. That impression may not be wholly war- ranted, as the information before the public is still imperfect, but it exists, and may have serious consequences. We do not pretend to know all the facts, or to have any secret informa- tion whatever, but we have watched all public proceedings and utterances with care, and they tell us a story which, cor- rect or inaccurate, is at least clear, and as the astronomers say of a theory, "does explain the phenomena." There can be little doubt that the Government, or at all events, the Premier, a few weeks ago, finding the country willing to support a decided policy in Egypt, resolved to take a step further in the same direction, and see whether, by timely financial aid to the Khedive, a still more complete influence over the Valley of the Nile could not be established without war. Hence Mr. Cave's mission of inquiry, which, though made at Government ex- pense, was not decided on at the request of the Khedive, who wanted an accountant and not a commissioner, and was so irritated that he dismissed his Chancellor of the Exchequer, Nubar Pasha, and so behaved himself that a rumour spread of Mr. Cave's immediate return. Ultimately, however, the Khedive, seeing that if England supported him his most immediate difficulties would all vanish, dealt with Mr. Cave frankly, talked to him freely, told him his position as far as he understood it himself, and proved to him, as all accounts agree, that if all his debts could be consolidated at a reasonable interest, his affairs were still in a solvent con- dition. So favourable was the apparent position, that English assistance seemed likely to be forthcoming, and if we are right in our view of the history of negotiations, would have been forthcoming—English capitalists finding the funds, and the British Government the Commissioner to receive the revenues devoted to paying interest—when France and Italy interfered. Extremely strong representations were made, through a pleni- potentiary, despatched from Paris in all haste to Cairo, that any such Commission must be international, and not exclusively English,—so strong, that Lord Derby took alarm, hesitated to press the original idea, and at last induced his leader or the Cabinet to abandon it. He hinted at this himself, in a speech in which he stated that a loan to the Khedive on certain securities connected with the Canal had proved unacceptable to foreign Governments, and it was hinted still more clearly in the Italian Press. The English idea being abandoned, the international idea remained to be considered, and although Mr. Disraeli entertained it, and even mentioned it with favour, it was not ultimately approved. The Government, though willing to assist the Khedive, were unwilling, apart from possible political complications, to incur any financial risk, or to encourage British capitalists to incur such risk, unless the result of their venture was to secure a definite hold on Egypt for the benefit of Great Britain and India. An international transaction would secure no such hold, and that there was financial risk, whatever its extent, was evident from Mr. Cave's Report. We have not, of course, seen that Report, but it is evident, from the view of it circulated in different quarters, from the assurances in the Pall Mall Gazette—where the Report, or part of it, appears to have been seen—from the statement in the Observer, avowedly on the authority of Mr. Cave himself, and from the explanation of Sir S. Northcote on Monday night, that the report ran broadly in this wise :—If Egypt could be governed on Western principles of finance, and all the three debts, that is the State Debt, the Private Debt, and the Floating Debt, consolidated at a decent rate, say, six, or even seven, per cent., the Egyptian Government could pay its way without any serious difficulty. As we calculate—not knowing Mr. Cave's figures—about half its income would be consumed in interest, leaving the other half, or say, in round numbers, £5,000,000 sterling a year in cash, for the expenses of Government. But—and it is this " but " which is kept too much in the background—unless the Floating Debt, which is raised at extravpgant rates and for short terms, and is continually increased by new borrowings, can be paid off and made an end of, a time must come whelp the Khedive, be he rich or poor, must—for want not of wealth, but of cash—suspend his payments. No secret whatever need be made of this ; the facts are perfectly well known, re- peat themselves everywhere when Governments are shut from the ordinary markets—as, for instance, in Turkey and Spain-- and are used by the Khedive himself, in justification of his demands for assistance. His whole argument is that he is a rich squire, with a profitable estate, bothered for ready-money. As the facts exist, they involve two risks, namely, the risk that the Khedive may not be set free; and that once set free, he may be willing, in pursuit of his Southern wars or of his dreamily vast industrial enterprises, or may be compelled, by demands from Constantinople, where everybody, from the- Sultan downward, is ravening for money, or by other causes, to run up a Floating Debt again. The first risk is admitted on all sides, and the second is also real. It is nonsense to say Ismail's word is a sufficient guarantee against it. Who guarantees Ismall'a life, let alone his promises ; or how is he, without declaring a war which might ruin his exchequer, to refuse to obey the Sultan's order—say, to supply a contingent in Arabia—an order sent to punish him for neglecting the pecuniary measures of conciliation desired at Constantinople. There is a risk, and the British Government, which expects to survive Ismail and his dynasty too, and is not willing to engage in inteniationar combinations affecting its road to India, withdrew from the affair. Having withdrawn, it did not care to publish Mr._ Cave's Report, or to give any definite opinion on the Khedive's finances, and has abstained from doing so. Instead, however, of stating the whole facts, as it would have been compelled to- do, were Government controlled by Parliament as it used to be, it contented itself with vague replies to isolated questions. In one of them, Mr. Disraeli contrived, in a fit of Palmer- stonian jauntiness, to leave the impression that Mr. Cave's Report was unexpectedly bad,—which apparently it was not, though it contained the very grave warnings we have spoken of ; while Sir Stafford Northcote, in a fit, we imagine, or punctiliousness, contrived on Monday to leave the impression that, although Egypt was solvent, the condition of the Floating- Debt was so bad that the events of six weeks might have con- verted a tolerably safe position into a very dangerous one.
We have tried to state the course we believe the Govern- ment to have taken with as little prejudice as possible, and with this much of favour,—that we think the original idea of securing a foothold in Egypt by financial assistance not a bad' one, but still the total result is eminently unsatisfactory. In the first place, the Government has shown weakness. It has retreated from a policy on which it had begun to act—or else it would not have despatched a Privy Councillor to Egypt with. a retinue exclusively composed of English permanent officials —with something of pusillanimity, and without asking whether the British nation wished it to retreat. It has been driven, almost without a struggle, out of a position, that of reversionary Suzerain of Egypt, which all Europe acknowledged to be a great one, and which its own people were willing, or we may fairly say eager, to attain. It is, we suppose, proper and " states- manlike " to mince matters, but if Lord Palmerston had been alive, and had had to write on the affair, say, to his represen- tative in Berlin, he would have said that "he wanted to keep the Khedive going, if the Khedive would accept the position of a first-class Indian Prince." Then, having decided to retreat, the Ministry have so mismanaged details, that they have seri- ously disappointed and affronted the Khedive, who, be it re- membered, whether he is " enlightened " or not, is a Turkish Prince, accustomed to find his volition executive ; they have given stock-jobbers help in their plans of plunder, and they have offered France a chance which, if the Due Decazes lost his head for ten minutes, or the Assembly took the bit in its teeth, might be unspeakably serious. We confess, little as we now believe in this Ministry, it galls us, as Englishmen, to see the rascals who make " Rings " on 'Change standing open-mouthed in expectation to hear what British Ministers may say, and to see political journals contending for or against the publication of a State document, because, forsooth I foreign bondholders may suffer or benefit from its revelations ; but that, after all, is but a passing annoyance. The "Rings" will be ruined in good time, the Ministry see already that they must be either more frank or more silent, and the journals will soon turn to worthier topics, but the chance given to France is a most serious matter. Suppose the Government now ruling in Paris guaranteed 3 percent. on £20,000,000, to pay off the Egyptian Floating Debt, taking the customs revenue as security, and appointing agents at Alexandria and Suez to receive the revenue. They will not do it, we believe, though St. Petersburg would approve and Berlin would chuckle, because they do not feel sure that Great Britain would submit to so extreme a provocation, and do not want to dissipate their strength pre- maturely on a aide-question; but they have the chance of doing it, and what should we do then? The Khedive must get rid of his Floating Debt somehow, or be half-ruined, while still fully solvent,—that is his own view of that matter. The French public would be delighted with such a step towards the " re- habilitation of French influence," and would subscribe as eagerly as they did for the Suez Canal ; and as for our own public, however angry they might be, they could not but acknowledge that they had through their agents brought the defeat upon themselves. When a British Premier in his place in Parlia- ment says voluntarily that he will consider a financial project, if it is laid before him by a foreign State, he excites hopes which, whether excessive or not, are reasonable, just as reason- able as the hope of a borrower when his banker says that if Mr. Smith will endorse the bill, "he will see what he can do for him." Mr. Disraeli said this, and more, in his place in Parliament. The Khedive accepted the terms, and then got nothing, and if he turns to France, because we do not want him to turn to France, who can wonder? And his turning seriously to France means a possibility of a great war.
We suppose we must say something on the subject which interests the City so much—the real position of Egyptian finance—but we do it with the utmost reluctance. Briefly, our opinion is that Egyptian Stock is an investment which small investors unable to bear a loss ought to avoid. Mr. Cave's Report, whatever its actual words or inner meaning, or what- ever figures it may contain, has very little to do with this matter. Be that Report what it may, the main facts must re- main unchanged. Egypt is in the hands of an absolute ruler, who, whatever his personal character, cannot insure himself against death; who has already so overspent himself that he is paying Asiatic rates for loans ; who, whenever he is at ease, has a hankering after magnificent undertakings, both political and industrial; and who is, in a certain undefined, but consider- able extent, at the mercy of the most needy, the most unscrupul- ous, and the most corrupt of European Courts. We do not believe that the Khedive, unless prepared for a deadly war with the Khalif, has the means of resisting the demands of the Khalif's entourage by any plea, except the self-evident one that he can no longer pay. And consequently, though we believe that the Treasury of Cairo could be rescued by the determined intervention of any European State, and rescued without great financial hazard, we do not believe that, without such intervention, Egyptian Bonds can be a good in- vestment for the kind of people who must spend all the interest they get, and who will be ruined by even a temporary suspen- sion. Their wisdom is to disregard all the discussion that is going on, half of which they do not understand, and resolutely adhere to less profitable, but less risky speculations. The big fish can take care of themselves, but the little fish should keep clear of a stream so Asiatic in its character, so liable to be a dry bed one minute, an overwhelming torrent the next.
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