MR. GLADSTONE ON ILLUSORY FINANCE. T HE debate on Mr. Rylands'
Resolutions did not at all rise to the dignity of the subject. We cannot help feeling the intellectual decadence of the House of Commons, when we compare the speeches, for the most part slipshod and full of levity, with those delivered in 1863 with reference to Mr. Stansfeld's resolutions. In spite of their feeble defence—for Sir Henry Seiwin-Ibbetson's speech, though far superior to the Chancellor of the Exchequer's brazen common-places and frightened flippancy, did not face the criticisms of Mr. Goschen, Mr. Childers, and Mr. Gladstone—the Government got a victory, but it was very much like a defeat. They beat the Opposition by seventy-three votes ; and the Ministers will still be able to crow at banquets, and to say that they are the Government of the country. But they have received a dangerous stroke. They will never be able to explain away the moral effect of facts which were made very clear in the debate. They have been convicted of the crime which Englishmen, of all parties, in their heart of hearts, believe to be the worst. They are afraid to bring their roystering policy to the test of figures ; they dare not ask the nation to pay that which is spent ; they have been compelled to create a system of illusory finance. It was an entire mistake to assume, as some friends of the Government in the Press did, that the debate was an idle renewal of ques- tions already fully discussed and constitutionally settled. One Ministerialist after another asked, " Why this stale repetition of topics ? The House has sanctioned the individual items of expenditure ; why object to the sum-total ? A man may be foolish to buy this or that article of furniture ; but having deliberately bought each of them, it is still greater folly to quarrel with his wife about the large size of the bill." The House ratified all that the Government did in the East, in Cyprus, in Egypt, and Afghanistan, and Zululand ; and the argument was that it was asking Parliament to stultify itself, to condemn the price which had been paid for a resplendent and blazing foreign policy. That is the epitome of most of the speeches in defence of the Government ; and a very good defence it would have been, if the Government, in a manly, straightforward manner, had said on Budget night that " they had had a good deal of glory, and they were not afraid to ask to pay for it." That was Lord Palmerston's bold way, when his Government was active abroad, that has been the rule to which every Chancellor of the Exchequer since Peel's time has bowed ; and the illusory electioneering finance to which the present Administration has resorted, is an unfortunate departure from a manlier policy.
The first fact to which taxpayers who study the debate must make up their minds is that we are in a fair way to lose the reality of a Budget, or, as Mr. Gladstone put it, that "the annual statement to which the Representa- tives of the people look for information is tending to be- come absolutely worthless, while the control of Parliament is at the same time imperilled." Hitherto the Constitutional assumption has been that once a year a statement should be made which should closely approximate to the results shown by the Appropriation Act ; that some estimate should be made for every contingency on the horizon ; that Supplementary Estimates should be exceptional ; and that, in fact, once a year stock should be taken. No Government has been able to avoid asking the House for new credits, and when a great war is on hand Supplementary Estimates are inevitable ; and even when there is no war, the April calculations are liable to fall short of the requirements. The new charges varied from £125,000 to £350,000, under the late Government. But under the present Government, the average excess has been £1,100,000 to £1,200,000. Of course, the result of conduct- ing business in this manner must be that the House will lose all useful control over the finances of the country. It is told by Ministers in April, when the financial statement is made, that it is no use trying to anticipate what will be the correct Estimates ; and at the end of the Session, when the facts are known, the House is informed that it is much too late to think of imposing taxes. Under this sys- tem, the country never gets a clear view of the true financial situation ; the books are not closed, and the balance for the year is not struck, until long after all interest in the matter has ceased. The nation is puzzled by the new- fangled hocus-pocus of ordinary and extraordinary expenditure. A Government may thus continue in a path of extravagance, without the bulk of the electors, or even of the Members of the House of Commons, being altogether aware of the fact. That is well illustrated by the experience of France under the Second Empire. If our finances have been superior to those of France, and other countries in which the national accounts are made up on the French system, it is because instead of two or three tentative provisional Budgets for the same year, there has been one, by which a Government was prepared to stand or fall ; and which, as a rule, did correspond closely to the actual results at the end of the financial year. Another principle which is being pushed aside is that the ex- penditure of the year should as nearly as possible balance the income. Exceptions to it, never heard of before, are defended. No one, indeed, says that this is a hard-and-fast rule,—what maxim of finance is so ? There are times when it is prudent to borrow instead of taxing,—say, in the height of the Crimean war, with the Income-tax at I s. 4d; and there are expenses, such as those incurred in respect of the fortifications in 1860, which are fairly chargeable to capital, and ought to be spread over several years. But does the Chancellor of the Exchequer mean to say that henceforth, whenever trade gets bad and the Army has to be strengthened, we must refrain from imposing new taxes, and put off payment ? He tried to justify himself by reference to the fortification loan of 1860, but the differences between works which were built to last for many years and the expenses of expeditions, between times when the Income-tax was ls. id. in the pound and a new tax had been laid on spirits, and the present, are too large to be hidden. This is the worst feature of the bad Budget. It is the worst form of what has been called "democratic finance," the essence of which is servility to the merely ignorant impatience of taxation. It is in curious contrast with the conduct of Mr. Gladstone in 1859, who, having to meet, late in the Session, a deficit of £1,000,000 to £5,000,000, boldly proposed to impose a 4d. Income-tax and shorten the malt credits, telling the House of Commons that this was a sum which had never driven a British Parliament to the expedient of augmenting the National Debt. Such old- fashioned courage is now scoffed at as "heroic finance." Sir Robert Peel once said of a refusal on the part of the House of Commons to provide for a deficit, that it was " the worst thing that had been done by a reformed Parliament." What would have been his condemnation of the finances of the last two years ? We say nothing of the fact, as proved by Mr. Childers, that the late Government, without adding a shilling to the taxa- tion of the country, reduced the public Debt by £8,300,000 more than the present Government, and that the latter have greatly increased the floating Debt, thus crippling the power of the nation to raise money with ease in an emergency. What we hope will be made plain by this debate is that the traditions of finance built up since Peel's time, and deferred to more or less by every Ministry, Liberal or Conservative, are being undermined ; that new maxims are accepted, and that an enervating system of making things easy is taking the place of rules which were nothing but good-sense. The mass of electors have not patience to study the merits of any particular foreign policy, and are at the mercy of bold assertions. They are apt to be puzzled by sophisms about Reciprocity, especially if they are exporters. But they all know a little about book-keeping, and they will not fail to mark the decadence in business habits and traditions which the present House of Commons has sanctioned. The national house of business strikes the annual balance no longer.
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