REMINISCENCES OPINIONS IN 1849, TAXATION. LONDON; WATERLOW AND SONS, PRINTERS. lOSSOS WAU, / S-e^\C^v,A^v\ BRIEF REMINISCENCES OF OPINIONS IN 184.9, ON TAXATION. Few things are of greater promise, or better shew the progress of civilization, than the increasing interest taken by the higher classes in the welfare of their poorer neigh¬ bours—a wise and generous policy (were it but policy), since the former always benefit, and never so largely as by the improved condition of their inferiors. Mankind are not altogether responsible for the institu¬ tions under which they live ; they have been mostly inherited, some perhaps from remote ages—an inheritance not always to be rejoiced at. The interest inspired by some questions debated in 1849, has survived that session, of which taxation, in its Proteus forms, from its vast influences, is one of the most important. Taxation is direct or indirect: the former eschewed, the latter favored by property and protection. The “Edinburgh Review” says (No. 180, page 537), “All taxes are more or less mischievous, and assuredly un¬ popular.” A very important recommendation, in order to reduce taxation is to reduce expenditure, to which the member for Dumfi’ies (Mr. Ewart) added another, equally important—“ to alter the system of taxation.” As an apologist for indirect taxation, the “ Edinburgh Review ” favours “payments connected with some article of comfort and luxuiy, in which the price of the article and tax are so blended as to be undistinguishable nevertheless, the equity is doubted, and the system regarded as fallacious and deceptive. The complicated workings of taxation do not always lead to the results desired or expected. A mere pamphleteer does not speak ex cathedra; on the present occasion he refers very briefly to sentiments ex¬ pressed by talented and influential individuals of all parties, during the parliamentaiy session of 1849. When the member for Montrose (Mr. Hume) first complained of the national expenditure and taxation, his voice (in the then House of Commons) was like one crying in a wilderness; but increasing intelligence, and the better feelings that accompany it, have progressively called up an host of allies, and enabled the member for the West Riding (Mr. Cobden) to gain a victory, fraught with more important consequences than that of Waterloo, not to disparage the strategic skill or energies that characterized that conflict— Malta est veritas, et prevatebit. National expenditure would never have attained its present amount, or pressed so heavily and so unequally on the poor and all classes, if taxation had directly afiected property and its possessors. Indirect taxation encourages, direct taxation limits, expense. But for indirect taxation, England would not, at the present day, have been burthened with a debt, the interest of whicli exceeds her actual annual expenditure ! Nor would she 5 have raised ruinous loans to subsidize, Incite, and inflame wars—make a few men millionaires —^pauperize millions^ blight the blessings of peace, and retard civilization. The present state of Europe, her enormous debts, civil and military establishments, and proportionate miseries, have been forcibly and truly depicted by a respected member of the Society of Friends, and of the Peace Society, Mr, Gurney, (see his letter to Joseph Sturge, dated London, 8 mo. 23, 1849, in the Times, 7th Sep¬ tember, 1849). Military adventurers, from Alexander to Napoleon, vanquished existing tyrannies, but seldom advanced civilization, which has nevertheless progressed in despite of great discouragements,* The member for North Lincolnshire (Mr. Christopher, 20th July, 1849), is reported to have said, speaking of retrenchment, “ If the Government did not come forward with a proposition of the kind, either in the (then) present or next session, still it would be impossible for Parliament to oppose a very material reduction!” The member for Bucks (Mr. Disraeli), restraining his brilliant and sparkling wit, is reported to have said (3rd July, 1849), “ The best test of national prosperity is the degree of employment possessed by the great mass of the working population at a profitable rate of wages.” The member for East Somerset (Mr. W. Miles), and for North Warwick (Mr. R. Spooner), for Dorset (Mr. Banks), conservatives; for Glasgow (Mr. Me Gregor), for South- * Mr. Macaulay observes (vol. i. page 3), “ It has been found that profuse expenditure, heavy taxation, absurd commercial restrictions, corrupt tribunals, disastrous wars, seditious prosecutions, con¬ flagrations, inundations, have not been able to destroy capital so fast as the exertions of private citizens have been able to create it.” 6 wark (Sir W. Molesworth), for Edinburgk (Mr. Cowan), for Manchester (Mr. Bright), liberals, and many others have expressed similar sentiments. The right honorable member for Tamworth (Sir Robert Peel) speaking on the state of the nation, said (7th July, 1849), “After all, by far the most important part of the question, is the condition of the labourer.” In advance of many of his friends, he virtually coalesced with the hberal paiiy, lent liis powerful aid to abrogate the Corn Laws, gnve effect to Free Trade and Customs Reforms, and established the great principle of direct taxation—the most important of modern reforms. True conservatism leads; it does not wait till reforms, just in themselves, are forced on by time and long-continued oppressions, attended by violence, bloodshed, and a pro¬ fanation of the name of “ Justice.” History is chiefly a record of straggles to attain or retain power, and the abuse of power when possessed. The spirit of imperial Nero seems immortal—imperial-— uncivilized—barbarous—a perpetuation, sometimes an exaggeration, of the savage. It, however, has brighter features. The code of Napoleon will do honor to France when the “ gloiy ” of the empire has faded into oblivion, or shall be remembered with regret. In the debate 23rd June, 1849, the member for Montrose said, “'That no man had done more good in respect to relieving the country from taxation, than the member for Tamworth, who took oft' eight millions of taxation that pressed on the industry of the country, and substituted five millions on the capital of the country.” “ He wished to get rid of the Excise.” “ If the House would support him, he would point out the methods 7 by which the duties on malt, hops, bricks, soap, windows, and paper might be removed, and the public credit left in a better condition.” “ It was a mockery to keep up 150 admirals when only 14 were wanted; and 350 generals when only half-a-dozen could be employed.”* On the 20th July, he pointed out that naval and military half-pay was leading to great expense, and noticed the following;— Officers. 1 admiral 1 do. 1 do. 1 do. Years’ service. Enjoyed half-pay or pension. 8 years 49 years. 9 year 43 years. 3 years and 2 months 33 years. 4 years and II montlis 35 years. On the debate on the state of tfie nation (7th July, 1849), he said “The drain on the purse of every man, high and low, caused by excessive taxation, and tbe inequality that existed in that taxation, could not be long * Sir Charles Napier, in liis letter to Lord John Eussell (dated December, 1849), says, “We have got rid of, or kicked down, or made away with, an amount of national property descrihable as follows;—13 thi’ee-deckei's, 144 two-deckers, 21 first-class frigates, 155 second-class frigates, 50 third-class frigates, 334 vessels of rates still inferior ; total 717 vessels, oyer and above some 70 receiving ships. In tbe place hereof we have got 14 new three-deckers, 40 two-deekers, 94 frigates, and 161 vessels of inferior rates, exclusive of steamers. The cost of the exchange may he estimated as follows! —^In the last 28 years, the navy estimates have amounted to a total of £160,169,146 5 and since the cost of the material is to the cost of the personal as about 25 to 20, it results that we must have spent some ninety millions sterling in the work described above—siKcc the war!” And he quotes Captain Rous, who says, “ A great part of the national debt has been incurred in b iilding ships and pulling them to pieces.” continued.” “The income-tax, of which they heard so much as falling upon persons of propei-ty, was only per cent, of the whole revenue. Now he was always told that the capital of the country had gi’eatly increased; if so, then let the taxes fall on the capital in proportion;— let there be a direct tax on realized capital, and then take off the customs, excise, and stamp duties, that fall so heavily on the poor.” On the 17th July, 1849, on the debate on Mr. Henley’s motion for a reduction of public salaries, the member for the West Riding said, that “In his opinion, the chief officers of state were excessively over-paid. A salary of £5,000 for occupying a seat on the Treasury Bench, was much more than need be paid to any man.” Why, considering the general range of profits and prices, should we pay our public officers more than double the salaries paid to the public officers of any other states?” “The four principal secretaries of the United States received only £1,250 each, have the same corresponding dignity with secretaries in this and other countries.” “ Take next the diplomatic officers. Our ambassador At Paris has... .. £10,000 per annum. To Austria. 9,000 per annum. To Spain !. 6,500 per annum.* * The French Eepublic for some time maintained onlj a charge d!affaires in London, and it is greatly to be regretted there should be any diplomatic officer of higher rank or pay. Since the English ambassador was driven from Madrid, a consul has answered every nsefol purpose!! About a century since, the Marquis of Pomhal engaged in the reform of Portuguese finance. There were nearly 60,000 employes, whose labours were afterwards performed by less than 60 persons. Portugal suffers a partial Why, the United States did not pay their highest diplo¬ matic functionary more than £2,000 a year. Now he put it to the House, had they an ambassador or minister abroad, who would consider it derogatory to his dignity to be compared with Mr. Bancroft?” On the 19th July (speaking of the Ordnance), the member for the West Riding said that Sidney Smith had observed “The world never yet saw so extravagant a government as the government of England: not only is economy not practised, but it is despised, and the idea of it connected with disaffection and Joseph Hume. Every rock on the ocean, where a cormorant can perch, is occupied by our troops, has a governor, deputy-governor, storekeeper, and deputy-storekeeper, and will soon have an archdeacon and a bishop.” Reverting to the Ordnance, he called attention to the stores in hand, and their annual delivery for consumption:— Stores. Annual delivery Years’ consumption for use. on hand. Pikes 142,000 3,000 47 years Havresacks 170,000 7,000 24 years Kettles 24,000 3,000 8 years Sand-bags 1,200,000 35,000 34 years Flint muskets, 448,000, and upwards of 30,000,000 of flint cartridges, useless for percussion muskets!! On the 20th Jul}^, 1849, when the member for West Surrey carried his resolution, the Chancellor of the Exchequer said, that from 1842 to 1849, more than nine relapse. The system is deeply rooted in Spain, and, unfortunately, is endemic throughout Europe. The member for the West Riding declined to support Mr. Henley’s motion (17th of July, 1849), for a reduction of 10 per cent, on salaries, there being more than 20,000 employes in England at salaries of less than £100 a year. 10 millions had been taken off the duties on raw materials and articles of consumption; and that “ unless the honorable member was prepared to double the income-tax, it was hard to conjecture what course he would recommend.” But he omitted to notice that all reductions shew unne¬ cessary expenditure ; and that the larger the reductions, the greater must have been that expenditure. One of the first steps towards economical government will be direct taxation. Indirect taxation encourages loans, debts, war, slaughter, and aggravates the miseries that afilict and brutalize the human racedirect taxation is the natural natural ally of peace. Property, ever sen¬ sitive, sometimes displays an “ ignorant impatience ” of direct taxation, though, like the governor to a steam- engine, or regulator to a watch, which denote and expose an irregular expenditure of time and power, it tends to correct and restrain undue and unnecessary expense. On the 23rd June, 1849, the member for Montrose said, “ If the House would support him, he would point out the method by which the duties on malt, hops, bricks, soap, windows, and paper, might be remoimd, and public credit placed in a better condition.” It is to be regretted he did not then give the details. If the Excise duties were got rid of (on all ai’ticles except spirits), it would save at least half a million in the collection, and dimi¬ nish the great political evil of patronage. Indirect taxation is accumulative, and aggravates the duties raised by the State. All traders are entitled to interest on capital, whether employed by the cost of the article or by taxation. Indirect taxation increases cost, lessens consumption, subjects the poor to many privations, and aflects the best interests of producers, by circum- 11 scribing their natural markets—the wealthy are seldom ultimate gainers by indirect taxation. As population, wealth, public debts, commerce, and intelligence expand, it becomes more difficult to deal in a narrow spirit with, and as it were to tinker, taxation. The member for West Surrey truly said (23rd June), “ The Chancellor of the Exchequer was right in not repealing small taxes.” The revenue returns shew (5th January, 1850), that there is a surplus revenue, which it is hoped will not be wasted in war, or naval and military displays and extravagances; but that a reduced and amended system will benefit all classes, not only the poor but also the wealthy, who always benefit most when the poor are benefited. Two points must not be lost sight of. 1st.—That the surplus arises from a continuance of peace. And, 2nd.—From direct taxation, as imposed by Sir R. Peel. Without direct taxation, we should now have to deal with a deficiency ; and but for the continued peace, we should have to encounter an increased property-tax, without a reduction, but with an increase, of indirect taxation. To take an hypothetical glance at direct taxation, if it replaced the assessed taxes and the Excise duties (except the duty on spirits)—tender ground, which seems to trench upon official prerogative. In the year ending 5th January, 1850, the assessed taxes produced (excluding fractions less than £1,000) .£4,308,000 The Excise produced (excluding fractions less than £,1,000) .£12,753,000 Deduct Excise duty on spirits, pro¬ posed to be retained.. .. 5,000,000 - 7,753,000 12 To repeal all the assessed taxes and Excise duties (except the duty on spirits), would reduce the revenue, in round numbers, twelve millions. The property-tax of 3 per cent, produced, for the year ending the 5th of Januarj-, 1850, £5,400,000 If the property-tax were increased to 10 per cent., as paid during the late war (with the Excise and assessed taxes also), the additional 7 per cent, would produce .. .. .. .. 12,616,000 Leaving a balance of upwards of half a million in favour of the revenue, after repealing all the Excise duties (except on spirits), and all the assessed taxes. Indirect taxation is one of the errors we have inherited. It is a delusion to imagine that poverty, ignorance, and labour can, by any device, be made to bear all the burthens of the state, in exoneration of property. The attempt always recoils, and inflicts miseries such as have been frequently, and are at this day, shared by rich and poor throughout Europe; and we, in a degree, share with Ireland.* Agriculturists and manufacturers equally desire and deseiwe a market for the produce or the products of the raw material on which they bestow their labours. Every * Dea'eased duties increase consumption, and sometimes revenue. The Chancellor of the Exchequer had the satisfaction of stating (2nd July, 1849), that the import of sugar had increased from 200,000 tons in 1844, to 300,000 tons in 1848; the duty on plan¬ tation sugar having been diminished from £1. os. 2c?. to 13s., and the protecting duty being also diminished. In 1845, the consumption of brandy was 1,073,000 gallons, the duty 22s. per gallon; in 1848, the consumption was 1,600.000 gaUons the duty 15 j. 13 system that compels a narrowed consumption, inflicts unne¬ cessary privation on consumers, and injury on producers. A free and open market can only exist when the numerous labouring classes are enabled to become con¬ sumers. Oppressed, distressed, and depressed poverty can consume but little, and afford but a veiy limited market; while the pittance doled out as charity, becomes a heavy retributive tax on property. All taxes, direct and indirect, affect consumers, filter through all ranks, till they reach wages and the working- classes, who always bear a full proportion. Direct taxation, accompanied by a repeal of existing taxes, would benefit all classes. A repeal of the assessed taxes would not only benefit persons charged with heavy duties on windows, horses, carriages, servants, &c., but would also relieve a numerous, deserving, and straggling middle class; and ultimately the poor, who always benefit by the prosperity of the higher, as the wealthy benefit by the prosperity of the labouring classes; a reciprocity that, however damaged or deranged, can never be wholly destroyed. A repeal of the malt duty would greatly benefit all classes, especially agriculturists; the duty thereby remitted would alone exceed a moiety of an increase of £7 per cent, on the present property-tax, independent of the benefit that will be derived from increased consumption, when the poorer, but more numerous classes, are permitted to become more extensive consumers. After the beer duty was repealed, the consumption of malt, which in 1815 was about thirty millions of bushels, rose to forty millions of bushels. If the malt duty were repealed the increased consumption would afford a healthy 14 and natural protection to agriculturists, and greatly benefit all classes. The member for West Surrey said (23rd June, 1849), that in “this country and climate, beer brewed at home was a necessary of life.” When the member for West Surrey carried a resolution (20tli July, 1849), “ That it is the opinion of this House that adequate means should be forthwith adopted to reduce the expenditure of the government,” he said the whole establishment of this country was pitched at too high a rate,—" every branch of our public and private economy, parishes, counties, state charities, corporations, public colleges and schools, the law, the church, and the whole management of our foreigm dependencies, must necessarily submit to examination and amendment.” On the same occasion the member for Montrose observed, that “ it was most unfair to levy forty millions by Customs and Excise duties, upon articles consumed chiefly by the labouring classesand the member for Dumfries added, “ that the demand for the repeal of the Excise duties would soon acquire a force which it would be impossible to resist.” “ The whole estabhshment of this country is pitched at too high a rate.” Many establishments, sanctioned by the legislature, though their revenues are neither collected nor apphed by the state, operate as taxes. The monstrous expenditure on railroads Inflicts loss on individuals, and a tax; on locomotion,—one of the first rights and necessities of mankind, which all men, even the humblest, are entitled to enjoy, on the most improved principles of power and speed, at the cheapest rate fairly remunerative to capital fairly and honestly expended.* * The cost of the forts round Paris would have sufficed to form railroads to the principal navtd stations, 4ind with the debt (1,000, Poor laws imperfect, and imperfectly carried out, evince a disposition to charity, yet often aggravate miseries they are intended to relieve. Their insufficiency to relieve even diminished distress, and the highly creditable desire to do so, are evidenced by multitudinous private charities. But charity embraces a wider field than a mere bestowal of alms; the greatest, the noblest charity is that which strives to circumscribe the necessity for their bestowal; and is never more extensively or effectually shewn than by honest legislation, equal laws equally administered, and just (which involves direct) taxation. It is doubted whether it be not as subversive of the true interest of society, when property, by taxation or otherwise, seeks to appropriate to itself an undue portion of the wages of labour, as when ignorance and poverty, mostly impelled by distress, strive to possess themselves of the property to which others are legally entitled. Rents equitably adjusted—that is, when they allow fair remuneration to capital, and to the skill, capital, and labour that render the raw material productive, are honourable and beneficial to all who pay or receive them. When otherwise adjusted, their consequences often prove a grievous tax on the receivers. On the 7tli July, 1849, the member for Montrose observed, that “ he did not think, looking at the state of the country as a whole, that it would be possible for agriculturists to continue the same rent to the landlords as now.” Any reduction of rent, whatever the cause, is apt to be treated as injustice, and compensations are millious,) left by Louis Philip’s government, to the principal sea-ports of France. The funds obtained by loans and taxation have been squandered and misapplied; and, instead of progressing, civilization has been retarded, and curdled into socialism, communism, chartism, &c. 16 seldom taken into account. If a rental of £10,000 be reduced to £8,000 (or any other sum), the arithmetical reduction'cannot be disputed, but if the lesser sum affords the same enjoyment, the actual reduction may be— nil. Having lost the duty on corn, agi-icultural distress, instead of putting, its shoulder to the wheel, calls upon protection’; seeks to chai’ge agricultural rates on the Consolidated Fund, and, by a side wind, to tack rent as a rider on taxation. It may, nevertheless, deserve inquiry whether ample, natural, and honorable protection, may not be derived from improved science; better directed industry; enlarged and extended (in place of restricted) consumption; reduced expenditure; direct taxation; a diminution of poverty and poor rates; improved and more widely-diffused education, of which Lord John Russell was an early advocate; and the welfare of humble millions, which always benefits the exalted; and a reliance on moral impulse which never errs, rather than on worldly wisdom, which is ever erring. Property will be the principal gainer by improved legislation; financial and other reforms. The indemnities to property against recent and contemplated changes, are not always rightly considered. Of the benefits that result from a repeal of taxation, property unavoidably takes the lion’s share. It derives the largest and most direct, and also the largest consequential benefits; but the most important benefit will result from the improved condition of the labouring classes, when, instead of a burthen as paupers, they, as consumers, afford a great natural protection to property. Brevity is neither the fashion nor the failing of the age; and these few pages deserve graver reproof than that of Boileau, "J’evite d’etre long, et je deviens obsour”