These large taxes, it may be said, must fall on property, which the smaller taxes now do not exclu sively do. ' Those who are in professions, as well as those who live from salaries and wages, and who now contribute annually to the taxes, could not make a large ready money payment ; and they would, there fore, be benefited at the expence of the capitalist and landholder. We believe that they would be ire ry little, if at all benefited by the system of war- . taxes. Fees to professional men, salaries, and wa ges, are regulated by the prices of commodities, and by the relative situation of those who pay, and of those who receive them. A tax of the nature pro posed, if it did not disturb prioes, would, however, change the relation between these classes, and anew arrangement of fees, salaries, and wages, would take place, so that the usual level would be restored.
The reward that is paid to professors, &c. is regu. lated, like every thing else, by demand and supply. What produces the supply of men, with certain qua lifications, is not any particular sum of money, but a certain relative position in society. If you dimi nished, by additional taxes, the incomes of landlords and capitalists, leaving the pay of professions the same, the relative position of professions would be raised ; an additional number of persons would, there fore, be enticed into those lines, and the competi tion would reduce the pay.
The greatest advantage that would attend war taxes would be, the little permanent derangement that they would cause to the industry of the coun try. The prices of our commodities would not be disturbed by taxation, or if they were, they would only be so during a period when every thing is dis turbed by other causes, during war. At the com mencement of peace, every thing would be at its na. tural price again, and no inducement would be af. forded to us by the direct effect, and still less by the indirect effect of taxes on various commodities, to desert employments in which we have peculiar skill and facilities, and engage in others in which the same skill and facilities are wanting. In a state of freedom every man naturally engages himself in that employment for which he is best fitted, and the greatest abundance of products is the result. An injudicious tax may induce us to import what we should otherwise have produced at home, or to ex port what we should otherwise have received from abroad ; and in both cases, we shall receive, besides the inconvenience of paying the tax, a less return for a given quantity of our labour, than what that labour would, if unfettered, have produced. Under a complicated system of taxation, it is impossible for the wisest legislature to discover all the effects, di. rect and indirect, of its taxes; and if it cannot do this, the industry of the country will not be exerted to the greatest advantage. By war-taxes, we should save many millions in the collection of taxes.. We might get rid of at least some of the expensive esta blishments, and the army of officers which they em ploy would be dispensed with. There would be no charges for the management of debt. Loans would not be raised at the rate of L. 60 or L.60 for a no minal capital of L.100, to be repaid at L.70, L. 80, or possibly at L.100; and perhaps, what is of more importance than all these together, we might get rid of those great sources of the demoralization of the people, the customs and excise. In every view of this question, we come to the same conclusion, that it would be a great improvement in our system for ever to get rid of the practice of funding. Let us meet our difficulties as they arise, and keep our estates free from permanent incumbrances, of the weight of which we are never truly sensible, till we are involved in them past remedy.
We are now to compare the other two modes of defraying the expences of a war, one by borrowing the capital expended, and providing annual taxes permanently for the payment of the interest, the other by borrowing the capital expended, and be sides providing the interest by annual taxes, raising, by the same mode, an additional revenue (and which is called the sinking fund), with a view, with in a certain determinate time, to redeem the original debt, and get rid entirely of the taxes.
Under the firm conviction that nations will at last adopt the plan of defraying their expences, ordinary and extraordinary, at the time they are incurred, we are favourable to every plan which shall soonest redeem us from debt; but then we must be con vinced that the plan is effective for the object. This
then is the place to examine whether we have, or can have, any security for the due application of the sinking fund to the payment of debt.
When Mr Pitt, in 1786, established the sinking fund, he was aware of the danger of entrusting it to ministers and parliament ; and, therefore, pro vided that the sums applicable to the sinking fund should be paid by the Exchequer into the hands of commissioners, by quarterly payments, who should be required to invest equal sums of money in the purchase of stock, on four days' in each week, or about fifty days in each quarter. The commissioners named were, the Speaker of the House of Commons, the Chancellor of the Exche quer, the Master of the Rolls, the Accountant Ge neral of the Court of Chancery, and the Governor and Deputy-Governor of the Bank. He thought, that, under such management, there could be no mis application of the funds, and he thought correctly, for the commissioners have faithfully fulfilled the • trust reposed in them. In proposing the establish ment of a sinking fund to Parliament in 1786, Mr Pitt said, " With regard to preserving the fund to be invariably applied to the diminution of the debt inalienable, it was the essence of his plan to keep that sacred, and most effectually so in time of war. He must contend, that to suffer the fund at any time, or on any pretence, to be diverted from its • proper object, would be to ruin, defeat, and over turn his plan. He hoped, therefore, when the bill he should introduce should pass into a law, that House would hold itself solemnly pledged, not to listen to a proposal for its repeal on any pretence whatever." " If this million, to be so applied, is laid out with its growing interest, it will amount to a very great sum in a period that is not very long in the life of an individual, and but an hour in the existence of a great nation ; and this will diminish the debt of this country so much, as to prevent the exigencies of war from raising it to the enormous height it has hitherto done. In the period of twenty-eight years, the sum of a million, annually improved, would amount to four millions per annum, but care must be taken that this fund be not broken in upon ; this has hitherto been the bane of this country ; for if the original sinking fund had been properly preserved, it is easy to be proved that our debts, at this mo ment, would not have been very burthensome ; this has hitherto been, in vain, endeavoured to be prevent ed by acts of Parliament ; the minister has uniform ly, when it suited his convenience, gotten hold of this sum, which ought to have been regarded as most sacred. What then is the way of preventing this ? The plan I mean to propose is this, that this sum be vested in certain commissioners, to be by them applied quarterly to buy up stock ; by this means, no sum so great will ever be ready to be seized upon on any occasion, and the fund will go on without interruption. Long and very long has this country struggled under its heavy load, without any prospect of being relieved ; but it may now look forward to an object upon which the existence of this country depends; it is, therefore, proper it should be fortified as much as possible against alien ation. By this manner of paying L.T50,000 quar terly into the hands of commissioners, it would make it impossible to take it by stealth ; and the advan tage would be too well felt ever to suffer a public act for that purpose. A minister could not have the confidence to come to this House, • and desire the repeal of so beneficial a law, which tended so directly to relieve the people from Mr Pitt flattered himself most strangely, that he ' had found a remedy for the difficulty which " had hitherto been the bane of this country ;" he thought he had discovered means for preventing " ministers, when it suited their convenience, from getting hold of this sum, which ought to be regarded as most sacred." With the knowledge of Parliament which he had, it is surprising that he should have relied so firmly on the resistance which the House of Com mons would offer to any plan of ministers for vio lating the sinking fund. Ministers have never de sired the partial repeal of this law, without obtaining a ready compliance from Parliament.