this valuation rather low. But reckoning at 80,000,000l. that fum, if charged with four shillings in the pound, would yield an annual revenue of 16,000,000. Money spent in wars, goes for articles which the war confumes, or for purchafing provifions at an enormous rate, perhaps from your enemies. Whereas money spent in peace, reverts immediately into circulation, and even the public creditor returns to the public in procefs of time, a considerable part of what he has received. The property of foreigners in the funds is confidered as one of the great myfteries of the state, and is concealed as if the fate of the nation depended on the disclosure. But from Mr. Sinclair's information, there is no reafon to prevent it being fully known; for the fact, he is convinced would turn out, that of 8,800,000l. a year, due to public creditors, not one million is the property of perfons living out of this island. Therefore the refources of the country for additional revenue, will be greatly increased, by the additional confumption of thofe to whom the income of the new taxes must be paid. He then ftates what appears to him to be the real fituation of the Finances of this country. GENERAL VIEW of the fuppofed INCOME and EXPENCES of the NATION. 1. To the fuppofed produce of the taxes laid on prior to 1783 3. Malt tax E. L. 11,618,196 2,000,000 750,000 0 O 4. New taxes which must be laid on to pay the interest of the debt not yet funded or borrowed, including the taxes to be laid on this year 1,399,000 o £15,767,196 3 to Public Debts and Finances January 1783. FUNDED DEBT. F Increase of the funded debt from 1775 to January 1783 £85,857,691 0 The money received has been only 57 millions that is 28 millions, or one half the fum, lefs than the increase of the debt. Intereft and management 3,294,598 2 Whole capital of the funded debt January 1783 £215,717,709 0 Whole of the Interest and management £7,513,852 9 ó UNFUNDED EXPENCE of the WAR in the Years 1779, 1780, 1781, and 1782. o Thefe totals do not include any miscellaneous and incidental expences common to peace and war, which amounted, for fix years ending at 1782, to 126,7721. per ann, exclufive of the expence of calling in the gold coin and for fix years, to 1772, to 106,555. per ann. SKETCH of a Comparison of the Expence of the four laft Years of the War, with the Expence of the four latt Years of the two Wars immediately preceding it 31,813,317 276216,355,190 60,835,697 This comparifon would have been moft ftriking, had it been extended to the wars of King William and Queen Anne. The expence of these wars, diftreffed the nation unspeakably.Whence comes our power to bear fo enormous an increafe of expence (-Certainly, not from the increate of either our people or coin. Sketch of a plan for future loans and paying off the national debt. His Majefty having recommended the flate. of the public debt in his fpeech, Dr. Price drew up a sketch of a plan for that purpose, and sub mitted it to the confideration of the King's Ministers, The Dr. was of opinion that the refloration of peace was the first and most neceffary means to promote the redemption of the public debts. Peace What became next neceffary, was to procure a fun lus in the revenue, fufficient to be employed in a plan of redemption. The lea to be the ght of as a million. He had already fhewn the it was necellary to raise the annual revene to fifteen millions, on a fuppofition that the evil lit and the peace efablishment we e to b the fame as before the war. The lof of Minorca and the liberation of America, the Dr. fays, have already produced great favings, and fill greater favings might be made by reducing the landing army, that mortal foe to lib rty, and truding the people with their own defence; by reform ng a ufis; by abolithing ufeleis places and exorbitant emoluments, and establishing a rigid economy in every department; perhaps by fich mears the furplus of a milion might be obtained; and fuppofing it obta ned, the Doctor's defign is to hew in what manner it may be applied with the greateft effect in the leal time. The Dr. then explains a preparatory meafure of great confequence. In paying off debts with any given furplus, their bearing a bigh rather than a low intereft is a part cular advantage. A million furplus, in the fame time it would pay off an hundred millions bearing 3 per cent, would pay off 133 millions bearing 4 per cent; 178 millions bearing 5 per cent; and 241 millions bearing 6 per cent. The Dr. therefore propofed to convert the 3 per cents into 4 per cents; and that future loans thould be the means of this converfion. The 3 per cents. were 68 and the 4 per cents, 86. The holders of the 3 per cents, were to be offered 2001. four per cent. flock in exchange for 1ool. of their 3 per cent, and 1041. in mo ney. In this cafe the intereft would be 41. 16s. 2d. per cent; for 51. paid on 1041. is the fame with 41. 165. 2d. on tool. To ob'ain TFN MILLIONS, it would be neceffary that 9,615,384!. of the 3 per cents. fhould be fubfcribed; in exchange for which a double 4 per cent. flock would be granted; confequently 19,230,7681. added to the 4 per cents, one half of which would be fo much added to the public debt, and the other half a fubftitution of one capital for another equal capital. The public would make juft an even bargain. 104 would be paid by inftallments from March or April to November or December, but the interelt would begin at the Christmas preceding. Secondly the addition of an 8th per cent. for feven years to the interest of the new four per certs, propofed to be granted as an equivalent to a lottery. De Price withing Adminiftration to thew its purity by difcarding thefe thocking no:fances. Thefe advantages amount nearly to 3 per cent. on the money advanced. To the holders of South-fea ftock and annuities the profit would have been near 1 per cent. more, and had only one third of thefe accepted the intended offer, the fubfcription would have been almost full. The amount of the South-fea ftock and annu ties is £25,984,694 The amount of all the 3 per cents. before April loan 169,613,254 26,750,000 The 4 per cents. If more encouragement had been thought neceffary the profit might have been encrease in any degree, by taking any fum lets than 1041. If the fum required was rool. the profit would have been nearly 8 per cent, the intereft just 5 per cent, and the old flock converted, and the additional Rock created, the fame with the fum borrowed. P Advantages to the Public. Such loans may be eatly accommodated to any flate of the public fonds. They require no exorbitant premiums. In the loan 1781, the addition to the public debt was twenty one million; the money received only twelve mons; the public, therefore was bound to pay nine millions more than it received. Loans on the plan now propofed would tend to raise the flocks. They would refcue government out of the hands of rapacious money jobbers, No more would be neceffary than to open books at the Bank, and to take the fubfcriptions of the 3 per cent. flock holders without any felection, the ftock fubfcribed being a futficient fecurity for the fubfequent payments. No one being capable of fubfcribing beyond the amount of the frock he poffeffed, no monied men could monopolize the loan, nor could indigent men folicit thares of it with views of traffic and gain. The profits would be diftributed, not among contractors and place men &c. but among the flock holders who had foffered by the depreciation of the flocks. But the main recommendation of this mode of borrowing is its ufe as an operation of finance for facilitating a plan of redemption. In the course of the late war 1776 to 1782, 46,650,000l. was added to the 3 per cents. and 26,750,000 to the 4 per cents. making nearly 73 millions and a half, for which the money advanced was 48 millions. A furplus of one million per ann. cannot redeem this capital at par in less than 36 years, and 25 millions and a half more than D the 1 the fum advanced must be paid. Whereas had the 48 millions been borrowed at so high an intereft as 6 per cent. without premiums on a capital equal to it, the fame furplus would have redeemed it in 23 years and a quarter. In order to lay a foundation for farther operations, it was proposed to take measures for giving a higher value to the 4 per cents. Firft it was intended that the 4 per cents. to be granted in exchange for the 3 per cents. fhould, while under par, be declared first redeemable, but that when above par, that is when its redemption must be a lofs to the proprietors, it thould be irredeemable, while any of the old 4 per cents. continued unredeemed. It should be remembered, that a flock when under par cannot be redeemed except by purchafing it higher than the market price, confequently redemptions of stocks under par must always be an advantage to the holders. This regulation would neceffarily raise the price of the new 4 per cents. by removing the caufe which now keeps them down. The 3 per cents. being at 68, a 4 per cent. to be in proportion ought to be at 9c4, and this would be its price, were it confidered as no more fubjet to redemption than a 3 per cent. flock. Thirty years ago 56 million 4 per cents. were reduced to 34 per cent. for feven years, and afterwards to 3 per cent. for ever. All who trabe in the funds must look forward to a future measure of the fame kind. Ten millions borrowed this year in the manner already explained, would have added 19 millions and a quarter to the 4 per cents, one half of which would have been an old 3 per cent. capital. Let us fuppofe that next year the 3 per gents. will be 70, and confequently the old 4 per cents. redeemable at pleasure at 89. The new 4 per cents. if in proportion to the 3 per cents. would then be 93 1-3d. But fuppofe them only 91. A loan might be obtained by granting, in exchange for Icol. three per cent. and 651. 105. in money, 150l. four per cent. fuck not redeemable, except when under par, untill the redemption has been completed of all the 4 per cents. previously created, amounting to 46 millions, The intereft paid for the money advanced will be nearly 4 per cent, and a capital in the 3 per cents. one half more than the fum advanced will be converted into a 4 per cent; and a capital bearing the fame intereft, a quarter lef, than the fum advanced, will be added to the public debr." After borrowing or funding ten millions this year, there would remain a debt of 28 millions to be provided for; and fuppofing 15 millions of it borrowed or funded the next and the following years on these terms, 22 mil lions 3 per cents: will be converted into 4 per cents, and a new capital of 11 millions bearing this intereft, will be created; in confequence of which the 4 per cent. flocks will be increafed to 8o millions nearly, and an dition of 21 millions, which is four millions lels than the fum borrowed, will be made to the public debts. Thus would thefe loans have promoted the means of redeeming the public debts. First by a great faving of the capital: and fecondly, by rafing the intereft of a confiderable part of the old debts. But a great deal more might be done on the fame plan. From this of borrowing the Dr. reckons, that in three or four years, the 3 per cents. would be 75, and more than probable the 4 per cents. at par, but he propofes to reckon the later only at 98. In this ftate of thefe funds, the following operations, would, with advantage to the proprietors, and yet without expence to the public, convert 138 millions, the remainder of the three per cents, into 4 per cents, and at the fame time cancel a confiderable part of the capital. The 3 per cents. at 75, and the 4 per cents at 98, the difference being 231. it may be reckoned that 221. payable by eafy inftallments, would be readily given for a converfion of icol. three per cent into col. four per cent flock, not redeemable, except when under par, until after all the 4 per cents. then amounting to So millions were redeemed. In this cafe an intereft of 41. 115. per cent. would be made of the money advanced, when only 4 per cent could be made by purchafing 3 per cents. The principal also with 44 per cent. over would be recoverable at any time by a fale, fuppofing the ftocks not to fall. Let a million be procured in this way, and employed to pay off old debts. The confe quence will be, that 4,545,cool. will.be changed from an intereft of 3 to 4 per cent. and a debt of at least a million cancelled. The difference of the intereft between the 3 and 4 per cent flock being 45,4501. will be added to the converted capital; but at the fame time an equal annuity might be made to revert to the public, by employing the fum received in difcharging other capitals. By borrowing 30r4 millions annually instead of one million, all the 3 percents, might in a few years be converted into 4 per cents, and at the fame time a capital of THIRTY FOUR MILLIONS CANCELLED. Thus, by a feries of opera tions which would cost nothing, thirty four millions would be discharged, and 133 millions rendered redeemable with a million turplus, in the time in which otherwife only a hundred millions could have been redeemed. In confequence of thefe operations, the funded debt, after funding 25 millions and dedecting the 34 millions cancelled, would confift of 183 millions at 4 per ceut. This capital, a fund of ONE MILLION a year would cancel in FIFTY YEARS, fuppofing the fhort and exchequer annuities to fall into it. This plan is capable of expediting still more the redemption of the public debts, by the gradcal introduction of meatures, after con verting the 3 into 4 per cents, for converting the the 4 per cents themfelves into flocks bearing term be fuppofed the fame with that of the a still higher intereft. Here the Dr. breaks off faying, "But I will proceed no farther. Enough has been faid of a plan, which is now no more likely to be an object of the confideration of our Minifters." The Dr. then attacks the laft loan, and mentions that Lord Shelburne had this plan in view when on the th of May lat he moved the following refolutions in the Houfe of Peers. "That it is the opinion of this Houfe, < that all future loans thould be conducted in the manner which may beft conduce to << the reduction of the national debt, or which may at least not obftruct fuch redoc<<tion, but rather manifeft the intention of "government to proceed in time to fuch "reduction." Dr. Price then mentions feveral other plans which have been prefented to the Treafury for paying off the national debt. Several plans, very different from that now propofed, have been offered to the Treafury for the payment of the public debts. Two of thefe I will just mention. One propafes to pay off 67 millions in 50 years, and 200 millions in 99 years, by drawing out of the finking fund, during the first of thefe terms, 20,803,500 1. befides five mil lions to be procured in the first fix years by a method which the propofer conceals.* The other is a propofal to convert the intereft of the public debts into an annuity for a given term; the confequence of which would be the annihilation of them by time without any farther management †. Let the * I have mentioned this plan because it was faid, that it had been before communicated to Lord North and Lord John Cavendish ; and that sbey bad expreffed a favourable opinion of it. It is probable that the propofer is now renewing bis applications to them; and, therefore, I will just obferve, that a million per annum, drawn out of the finking fand for eventy years, (that is, an expence in the whole of only twenty millions) will, if applied first to the redemption of the 4 per cents. (amount ing fince the late addition to 293 millions) and afterwards to the redemption of the 3 per cents. at par, pay off 86 millions in 50 years; and, in 99 years, Four Hundred MillionsAnd that the fame fum drawn out of the finking fund in forty years (that is, half a million per annum wilt if applied in the jame manner, pay off 66 millions in 50 years; and, in 99 years, Three Hundred and Fifteen Millions. + This is a firong recommendation of this propofal; but it is too probable that fume future ministers, or parliaments, would defeat the operations of time by changing back the annuity into a perpetuity. The temptation to Long Annuity; that is, 77 years. The market price of this annuity, without the pays ment due upon it, is now (May 8th, 1783) twenty years purchafe, and the 3 per conts. are at 67. In thefe circumflances, it is not to be expected that any confiderable number of the owners of the 3 per cents. can be induced to change them for the annuity, without being offered 3 of the latter for every rool. of the former. A furplus therefore, of a million per annum payable for 77 years, would convert a capital of 200 millions in the 3 per cents. into an annuity of feven millions for 77 years. But, probably, in executing fuch a fcheme the incrcafe of the annuity and decreafe of the stock would fo reduce the one and raife the other, as to render a million per annum an appropriation very infufficient. The plan in these papers effects much more in less time, and at a much less expence. It converts the whole annual charge attending a debt of 232 millions into an annuity for 50 years, at the expence of a million per annum for that time, without depending on the confent of the pubblic creditors. Suppofing the appropriation to cease at the end of 20 years (that is, fuppofing only 20 millions advanced) it will convert the fame annual charge either into an annuity for 59 years; or a million of it into an annuity for 40 years, another million into an annuity for 60 years, and the remainder into an annuity for 64 years; and the whole progrefs of the fcheme will be attended with the ineftimable advantages arifing from an annual diftribution among the public creditors of large fuins increafing gradually from a million to fix or feven millions per annum, to be employed in commerce, or in loans to government should future wars render them neceffary, or in purchasing such of the old flocks as hould happen to be un, redeemed. Paying every year muft have the this in a time of public exigency would be too great to be refifted. Two fifths of the short annuities might be now faved by changing them into 3 per cent. annuities; and bad there been enough of such annuities to make it practicable during the last war to gain a fuving of two or three millions per annum, by fuch a measure, it would probably have been ad pted without regarding its future confequ nees; for we have long learnt, in matters of finance, not to regard futurity when any prefent advantage can be obtained. In the year 1720, there was an addition of three. millions to the capital of the perpetual annunities, by changing into perpetuities certain short and long annuities, fome of which (bad not this been done! would have been extinct forty years ago, but are now a part of the South Sea annuities, D 2 fame |