TEE BUDGET.
THE merit of the Budget is that it is simple and unpretending, avowedly provisional, and suited to a transition state. We have concluded the Russian war ; we have still some portion of the war-bill to pay, and have not yet so completely entered into that second forty-years peace on which some calculate, as entirely to lay aside the means of military defence. But we are not obliged to keep up the expenditure of active warfare, and we can dispense therefore with some draughts upon the popular pocket. The Budget has been extorted from Ministers before the usual time, but being brought forward it disarms the Opposition. Mr. Diaraeli was to have repealed the war-tax and something more—that is, the 9d. added to the original tax for the purposes of the war, and the 2d. which Mr. Gladstone calculated upon remitting in the ensuing year. Government surrenders the portion of the Incometax commonly, called the war-tax, but not the something more— not the 2d. With less the public would not have been satisfied, more will not be very rigidly demanded. The Budget is calculated to meet the after-expenses of the war ; and to carry out some of the measures which still remain on hand in completing the military defences we need such a revenue as would preclude a larger sacrifice of taxation, or even so large a slice off the Incometax unless a supply were made good by other means. Sir George Cornewall Lewis proposes to make up the supply by retaining a pertion of the tax upon tea and sugar which would this year have fallen in. The tax upon tea would have fallen from la. 9d. to 18. 3d. ; but he proposes that it shall only fall to 18. 7d. The present duties on different qualities of sugar are more complicated, but they are treated in the same way with tea. Sir George Lewis reckons, that with the retention of these taxes he shall be able to obtain a surplus of 890,000/. Thus he remits 9,000,000/. under the head of Income-tax, and imposes no new tax, but partially arrests a contemplated fall of the taxes on sugar and tea. Grumblings of course there have been at the disappointment : but nine millions is a great round sum which the public can perfectly appreciate, and it will not be inclined to support any very decided opposition to a Chancellor of the Exchequer who proposes that relief. Politically, there appeared to be some promise in the strategy of Mr. Disraeli, who proposed to stand by the Budget of 1853. It secured to him the alliance of Mr. Gladstone, or appeared to do so. But, in the interval of time since 1853, circumstances have materially changed. We have had an expenditure of about eighty millions in excess. And there is a single fact which shows how impracticable it would be to bring forward the Budget of 1853 in 1857. In the former year there was no apprehension of war; we have since not only had a war, but we are not sure that we are altogether rid of it yet. In the former year, Mr. Gladstone believed that the price of the Public Funds was so rising in the market, the value of money so declining, that upon Government security it would be practicable to raise a new Stock at 2.t. per cent interest; and the new Stock was laid before the public with a fair promise of success. Would the most sanguine of Gladstones conceive the possibility of introducing such a stock in the present year, or even in the next year ?
Indeed, nothing is more obvious than the difference between 1853 and 1857. Mr. Gladstone found the Income-tax established when he entered office. He is reputed one of a school which has a leaning in favour of direct taxation ; and even if individually he may not share that liking, he exhibited no repugnance. There is another reason for that dulness of sensation on his part: he belongs to the well-to-do classes, who have a balance at their banker's and who can draw a check for the amount of the
Income-lax, making their calculations for the year accordingly; whereas for the larger number of those who pay the Income-tax the claim of the tax-collector presents itself in the form of a bill which they are little able to meet. This is the grand distinction between taxes upon consumption and direct taxes, which will always make the favourite imposts of the Manchester School and the Liverpool Association unpopular. The needy man pays the tax upon consumption by driblets; he is compelled, under pain of foregoing something that he wants, to pay the due quota of tax every time he lays out his money: so that the State gets its due of him without any sudden and large demand—it detrains in driblets. If taxes are spread pretty equally over a large field of consumption, So that they do not operate to compel a preference of one article over another, they are a tax on expenditure—devoid of all the inquisitorial incidents of the Income-tax, and relieved from the pressure of a sudden and concentrated demand at a particular point of time. Notwithstanding his preference for a direct tax, however, Mr. Gladstone was actually undertaking to remove the Income-tax; and his prospective budget was reconciled to the popular judgment by the fact that it was not so much an anticipation of the budgets of the future as a facility for any succeeding Chancellor of the Exchequer. It proposed, not to snatch away the Income-tax at once, but to forego it by degrees, because we had gone far to accomplish the purposes for which that was the lever, and we could well afford to do without it. Still he delayed until 1860. Since his day, we have incurred these eighty millions of expense for the Russian war; we have in the Budget of the present year to provide a much larger income; we have not a perfectly easy state of the money-market ; and we have learned not to entertain the
same blind confidence in peace.
It would subvert the financial theory of the British constitution to pledge the budget of a future year in voting the budget of the present. In the discussions of the session, Ministers may speculate upon the-future, and Members of Parliament may assist them in speculating, but their constitutional authority does not extend beyond the 30th of March next year. The desire to get rid of the Income-tax rests upon general grounds. In a -Utopia, where every man declared his income without any kind of reserve or &IRAcation, it might' be a cOnvenient mode to set apart a given fraction for the public) service ; but in order to prevent the reserved or dishonest man from defrauding the honest man, it is necessary to render the Income-tax very inquisitorial in its levy. For this reason, we have always considered it a means for temporary and extraordinary purposes. It has usually been deemed a war-tax. Sir Robert Peel used it for a war upon Protection, believing that the necessity would pass by, and that before the expiration of the tax he could make better arrangements. That it should hang on hand is an opprobrium to the ingenuity of any Chancellor of the Exchequer for the time being: the tax is a reproach to every succeeding budget in which it figures as a permanent impost ; and the best thing which Sir George Lewis can do after this transition year, would be to revise his Budget with the same common sense which he has shown at the present time, and to plan those permanent arrangements which would enable him to erase the very name of Income-tax from his list.
GOVERNMENT IN FRANCE AND IN ENGLAND.
FEW contrasts are more striking, or more instructive, than the position of the two Governments in the Parliaments of France and England—if France can be said to have a Parliament, for in Parliamentary matters she has gone back even to a time before the days when the English Barons compelled King John to sign charters dictated by the nobles and freeholders of the country. In France, everything professes to come from above downwards. "Last year," says the Emperor, "my opening speech ended with an invocation of the Divine protection : that prayer seems to have been heard" ; and the achievements of the past year are thus piously referred to the direct patronage under which the Emperor claims to walk. From this position as it were on the mount, he gives forth to his people new laws, new distributions of territory, new taxes, and new remissions of taxes. He professes personally and directly to stimulate the laggard and to moderate the impatient, to encourage the virtues and cheek the vices of his subjects, not by the operation of normal laws, but by the direct action of the Government. Thus he boasts of having accustomed the country to new institutions " ; for in France, confessedly, institutions are wade—with us they grow. In France, as the Emperor says "breathless, unquiet, and importunate, society expects every thing from the Government."—" Blessed are they that expect little' ; and in England we have taken to ourselves that blessing. Perhaps our disappointments are sometimes the less ; at all events, we give less violent expression to them; and if we have a less sanguine expectation from the act of a particular Citizen-King or a particular Charlemagne-imitating dynasty, we have acquired a strong confidence that some day, on opportunity, we will work out the reasonable objects of our desire. In England, we are taught reason by experience ; in France, it is the Emperor who professes to keep the sanguine "within the bounds of the possible and, the calculations of reason."
Yet in this speech there is the germ of the very principle which would reverse its every position. The Emperor himself contemplates in 1860—that prophetic year of our Disraelis and Gladstones, Louis Napoleons and Michel Chevaliers—that he may be able to introduce free trade, or at least the sharp end of the wedge. But seeing how the report has alarmed the manufacturing part of the nation, he inculcates "the duty of good citizens to diffuse everywhere the wise doctrines of political economy." Now what are those doctrines ? They are the doctrines which have taught us to believe in freedom of trade. And what does that mean? We commonly use the words to indicate a certain policy, and we point to the results in our increased exports and imports, in the unprecedented activity of commerce and the magnificent augmentation of our wealth, notwithstanding some adversities and the burdens of war. Free trade means non-interference with the working of the motives that cause men to produce the fruits of industry, and to exchange them with those who can produce other fruits of industry,. where there is a profit in the exchange. We trust to the working of the natural wants, aspirations, energies, calculations, and judgment of the trading classes and those with whom we deal; and this trust in the direct working of human motives is confirmed by the results—by that same increase to our wealth, accompanied by a proportionate increase to our political and social order. For there has always been this distinction between wealth amassed through the power of the sword and of privilege, and the wealth produced by industry— that the possession of the power-produced wealth tends to a demoralizing despotism of the higher order over the poorer, with no restraint on its passions and indulgences ; whereas the possession of wealth acquired by industry and commerce tends some-. times too greatly to dislike the risks of contention, to prize the securities of peace, and thus to promote social order as much through the weaknesses as through the convictions of society. The same principle of freedom, however, is gradually applying itself, through public opinion, to a treat in what might be called in the
slang of the day the free trade of social and political as well as economical questions ; which means the working of the natural motives that bring men together.
We have had some severe rebukes to the despotic policy, evenwhen the despotism has been exercised on behalf of the humbler classes. There was an idea with us, as there was in France, that the introduction of sound economy, or of machinery, would destroy large numbers of the population; but the power-loom has fed hundreds of thousands more than it has superseded, and in our day we see the sewing-machine beginning to effect for oppressed needlewomen what preachers and associations failed to do. Our acutett and highest lawyers have discovered that some of the laws to protect domestic relations operate like most legislative "protection" to defeat their very object. We have laws to protect "credit," which should be the belief that one man reposes in another from the known character of that other ; and we see the comment in the list of bankrupts, and ill occasional disclosures of a more enormous mass of bankruptcy evaded or smothered up. We are gradually awakening to the fact that these laws of protection not only create false reliances, by which their object is defeated, but actually substitute fictitious for natural reliances —frail and corruptible manufactures for organic vitality. The whole tendency of our law-reform at present is to facilitate combination and organization, but to diminish the purely artificial constraints upon the freedom of the motives which lead to organization and joint action. It was for the purpose of protecting the interests of religion that conditions have been placed upon education incompatible with its free extension; but at last it has been discovered, that, in the broadest sense, those very means which draw forth the faculties of man tend in a most powerful manner to promote intelligence even in matters of religion. That is where the intelligence is left to work freely according to its natural instincts and affections, and is not tyrannically constrained. The rack made few converts ; severe laws against blasphemy, either in speech or writing, operated only for the protection of atheism ; which has virtually disappeared as naturally it might, under what i derogatorily called free trade in opinion. We see the result of this growing freedom based upon conviction in some of its most tangible forms, even where we have not attempted to work out the problem with a critically complete purpose. For instance, the Emperor of the French, who set himself to teach his subjects the impolicy of hiding their savings fruitlessly, in the stocking—who taught them to sow the golden seed in order to reap the fruit profit—finds that by that parental form of government he is now called upon to check speculation, which flaunts its gigantic jobbery in the highest places of his court; and he proposes to check it by a sumptuary tax upon " valeurs mobilieres," as a form of crusade against the "credit mobilier."
Perhaps the-distinction between the policies is not unnatural for countries in one of which institutions have grown while in the other they are a centralized manufacture. The last act of our Government, if not dictated, was anticipated by the people, —the curtailment of the Income-tax. Our commercial public, under the regime of free trade, has itself begun to feel a wholesome mistrust of speculation; and with us, where the policy, of the Government springs from the people, Government itself is certainly not less sure or less safe than it is where it possesses so much ostensible power.
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