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Leader (1850-1860), 24th December 1858, Edition 2 of 2, Page 24, UNITED STATES—FINANCE. We were summoned ...

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      14584, The Lea De R. . . [No. 457, Decem...

      14584 , THE LEA DE R . . . [ No . 457 , December 24 , 185 S

      Commercial.

      COMMERCIAL .

      United States—Finance. We Were Summoned ...

      UNITED STATES—FINANCE . We were summoned last week , by the publication of the French budget , to notice the financial condition of France , ana this week we are required , by the President ' s Message , to perform the same office for the United States . No mystification or " cookery" of accounts is attributed to him ; and all his figures are implicitly relied on . Unfortunatel y ^ the Republican Government , like its monarchical rivals , has not known how to keep its expenses down to its income , and is now imitating the spendthrifts of Europe by running in debt . This is a new p hasis in its latter life ; for , unlike them , it actually paid off its debts , and its revenue was so large that speculations were rife in the

      States as to the mode in which the surplus should be appropriated . Two years ago , in consequence , the rates of the tariff were lowered , taxation was remitted , the Government was encouraged by a plethora of wealth in carelessness and extravagance ; then came the commercial convulsion of 1857 ; the revenue of 1858 declined ; the Government could not immediately contract its expenses , and the consequence is that for the first time for several years it has again run into debt . It still shows , however , a very striking and favourable contrast in this respect to the two Governments of Europe with which it can best be compared .

      The total unredeemed debt of this country , funded and unfunded , was , on the 1 st of March , 1858 , within a few pounds , 806 , 000 , 000 / . The funded debt of France is 348 , 000 , 000 / . ; the unfunded debt is stated to be 28 , 000 , 000 / ., but this is below the mark . The debt of the United States , according to Mr . Buchanan ' s statement , is now actually 59 , 910 , 777 dols ., equalto about 11 , 000 , 000 / . This includes Treasury notes as well as stock , or floating as well as funded debt , and is a mere fraction' —though the resources of the nation are indefinitely great—of the mighty debt of either of the two monarchies . And Test we . should be

      reminded that each of the Federal states has a debt of its own , let us add that almost every county , and every town , and many parishes of England , have large debts , while the future produce of industry here is mortgaged to a large extent to the clergy of a particular creed . We put this contrast prominently forward because we do not feel called on to become the advocates of the Government of the United States . On the contrary , we sec with alarm—knowing how much the hopes of mankind have been centred on it ~ -that it has of late been stigmatised as excessively corrupt , and has undoubtedly become very unnecessarily extravagant .

      Between 1850-53 inclusive , the average expenditure of the . Government was 45 , 000 , 000 dollars j in the financial year 1857-8 , which closed on June 30 th , it was 81 , 585 , 6 C 7 dollars , and the yearly expense had increased therefore 36 , 000 , 000 dollars in five years . Within this period it has been engaged in no war but that against the Mormons , and the chief source of the increase is the multiplication of office holders . Mr . Buchanan , much to the delight of the Times and other advocates of extravagance , says that " comparisons between the expenditure

      now and ten or tvpenty years ago are altogether fallacious . " Additions of territory and . increase of population make some additional expenditure unavoidable j but rapid as is the increase of people in the States , they have not increased at the rate of cightv per cent , in five years . As the States have no colonies nor territories to maintain against an antagonistio nation , such a rapid increase of expenditure seems wholly unjustifiable . Twenty years ago , when the expenditure was not more than a third of its present amount—we have Mr ,, Buchanan ' s

      testimony to the fact— 'the Government was efficient aud the country prosperous ; and now , when the Government has entered into a career of wild extravagance , he informs us that money is used to carry elections ; of course , because success has for the candidates 1 - — bj bestowing on them influence over the Treasury- — a' money value , and he is filled with apprehensions for the future fate of his country . Lot him and other American politicians take to heart his own warning and not yield to the extravagance , nor encourage the corruption he justly dreads . To meet the expenditure of 1858—81 , 585 , 607 dola . — -the actual means woro 87 , 988 , 983 dola . ; but

      17 , 710 , 114 dols . of this sum were a balance which \ vas in the Treasury on June 30 , 1 S 57 , aud 23 , 716 , 300 dollars were borrowed in the course of the year . The produce of the customs duties , of the land sales , and of miscellaneous receipts on the actual revenue was only 46 , 557 , 569 dollars against 68 , 965 , 000 dollars in 1856-7 . So low as in 1858 the revenue has not sunk since 1850 , and the Government therefore would probably have had to borrow had it been even as economical as it was extravagant . With the loan of 23 , 716 , 000 dollars and the large balance in the Treasury last year , the balance for the year ended last June was only 6 , 398 , 310 dollars . At the same time the revenue has not recovered . The customs duties in the quarter ended September 30 th amounted to 13 , 444 , 520 dollars , against 18 , 573 , 729 in the same quarter last year . The estimated expenditure of the year now commenced is 74 , 065 , 896 dollars , and the estimated revenue , including a further loan of 20 , 000 , 000 dollars , which the Government is authorised to negotiate and one-half of which it has already borrowed , is only 81 , 129 , 194 dollars . So that next June , after borrowing in all 43 , 000 , 000 dollars in the two years , there wfll only be in the Treasury a balance of 7 , 0 63 , 298 dollars . With all deference to the statesmen of America , this is very bad husbandry , and we apprehend that if they continue in such a career , they will bring the Republican Government into as many difficulties as surround all the monarchical Governments of Europe .. Mr . Buchanan says , " No statesman would advise that we should go on increasing the national debt to meet the ordinary expenses of the Government . This would be a most ruinous policy . " He calls on . the Congress , therefore , now to make provision for the expenditure of the Government for the present year and for the fiscal year 1859-60 , and recommends an increase of customs duties , preferring special or fixed to ad valorem duties , which permit much fraud . ^ At the same time he calls on all parties in their respective spheres to practise the " most rigid economy , " and invites the Congress to " institute a rigid scrutiny whether the expenses in all the departments cannot be still further reduced . " He is sensible , then , of the impolicy of the present course , and would fain alter it , if the multitude of office-holders and expectants of office will allow him . Were he a younger man he might succeed , but he has already alienated fr . om him many of his supporters ; his party is dwindling away , and he will have to leave to some successor the task of devising a plan which shall secure additional revenue with decreasing expenditure . It may probably be considered fortunate , but it is a fact , that the founders of the American constitution have not provided any suitable means for securing it a revenue . It is authorised to sell land , and in imitation of the Governments of Europe , which sought to regulate trade by customs , to levy customs duties . But experience has shown that these divert trade from its ordained channels . If levied on articles of which none are or can be produced in the States—such as tea and coffee—which are very few , and which have been hitherto exempt from duty , they must be very high or the revenue will be insufficient . If levied on articles made or produced in the country , the whole sum taken from the consumer docs not go into the Treasury , " The consumer , " says Mr . Secretary Cobb , " pays the enhanced value not only on the quantity imported but on the quantity made in the country . The tax is paid not to the Treasury but to the manufacturer , rendering suoh a duty not only more burdensome but grossly unequal , the home producer being benefited at the expense of tho consumer , " Moreover , as theso duties arc levied rather on luxuries than on necessaries , they increase rapidly when the people are prosperous , and fall off as rapidly when t ( hey arc otherwise . Such duties , as we have seen in the ease of tho United Statos , flood the Treasury with wealth in one year and leave it nearly empty the next . Thoy are , conaequentlyy an unreliable source of revenue . Though popular with tho few whom they enrich , they are too extremely unpopular with tho many . The Republican Government is clearly disposed , like the monarchical governments of

      Europe , to appropriate to its own uses the property of the people-and t herefore we think it fortunate for the world that its authors gave it no o'her means of raising a revenue than by import duties winch arc at once unsuitable to the condition of the Americans , arid liked by only a very few of the people . It will be made economical in spite of itself ^ The Government , however , has no other means of covering the deficit , and concludes that a modification of the tariff is necessary . Mr . Cobb after reviewing the several objections made to the present system of ad valorem duties , decides contrary to Mr . Buchanan's wish to continue this plan and

      recommends the duties on the articles contained in Schedules C , D , F , G , H of the tariff , to be raised respectively _ to 25 , 20 , 15 , 10 , and 5 percent . This alteration he calculates will give an increase to the customs revenue of 1 , 800 , 000 dollars . He may find , like Sir F . Baring in 1839 , that 5 per cent , on the rate , is not more than 2 per cent , on the yield . To raise the additional amount required , lie is to select certain articles and transfer

      them from the lower to the higher schedules , taking care "to make such selections as will best promote the various interests of the country without doing in just ice to any . " With such a tariff as that of the United States this is impossible , and \ v » caii only expect that , as trade extends , the Government will again get involved in numerous difficulties . The people of New York , who have borne the brunt of the late convulsion , are resolved , it is said ,

      to oppose the alterations of the tariff . We see in books and newspapers a just appreciation of its effects on the country , and we do not believe that the federal Government , has of late so advanced in public estimation that all classes will be extremely willing to submit to inconvenience and loss to

      increase its revenue ; The consequence , let . us further say , of tine alteration in the tariff , will be to disturb and injure the trade between America and all other countries . All tariff ' s have such an effect ; and though they be only called for , as in this case , by the wanton or contemptible extravagance of governments , which exist onlvto protect , the interests of mankind , they arc passed generally with as much indifference , and assailed , too , with " as much satisfaction , as if they were , like the cultivation of the earth , csscnof such sub

      tial to human welfare . The bearings - jects on the commerce of every nation , and oi tlio whole nations of the world , arc not siifficicntlyxottsidered , or commerce is too much slighted , touch a reflection makes us direct especial attention to the subject in this part of our paper . It must not be inferred from the temporary decline in the revcuue of the Government that tne prosperity of the people is at an end . It is entirely the consequence of the commercial convulsion ot 1857 . which beffan in the States and was far more ¦«

      serious there than in any other country . ™» the collapse from prodigious inflation . In M es ena it was merelv an ajustment of accounts areijjj of credit to the actual amount of goods toansww it ; and though the people of New Y « k ,, the American shipping , and many persons wffejej torn porary evils- ^ sufflrcd from failed Bpowlatjg and deceived hopes-though many ^ W ^ fiS been deemed fortunes turned put to be losses , tncre « , «« ™ c «« nrnl Hnnl . inn in llio national progress .

      The sufferings and losses fcllchieflyon JPJ « J * 52 £ speculative traders and their inimedmtc connexions Some protected industries too , such as ¦ U * 80 ^ cotton and iron , suffered . But tfeo bulk oj ^ " ? people , the great ootton-growwff , . ? 'gJT no faucLlearing , and other great , « w * u » tnovww J » unprosperous . From this wo learn how to ** g » unjust it ia for the Govornmc . it to rely on « g £ » from which to collect a revenue , and on one >»™ {] of business to yield it . Wo learn , * ft . £ ™ Se deelinoof the Government revenue , while tlio p ^ l continued to increase and extend over m * fc tories , that they prosper rather in spiteiWw fc vernment than by its aid . Those who JJ ™ d g to model the institutions of Europe on tlio uw tions of America , seem tp forgot tllftt J } ° ^ JJtorJ tions can give to indnatry an unoccupwd ten * w j practically boundless , nn 4 to a people » ftDllJing industry practically skilfuUnd unwearied in . ««* u * wealth .

  • Citation
    • Leader (1850-1860), Dec. 24, 1858, page 24, in the Nineteenth-Century Serials Edition (2008; 2018) ncse-os.kdl.kcl.ac.uk/periodicals/l/issues/cld_24121858/page/24/