Excerpt from The Speaker, Vol. 4: A Review of Politics, Letters, Science, and the Arts; November 7, 1891

Not less clearly unanswerable is Sir William Harcourt's charge that Mr. Goschen has been able to secure surpluses only by diverting money that had been allocated for the reduction of the debt to the discharge of current liabilities. When Sir Stafiord Northcote was Chancellor of the Exchequer, he induced Parliament to pass an Act which fixed at twenty-eight millions a year the annual charge for the debt. He pointed out that that would ensure a very large reduction every year, and that as it was paid off the interest would be added to the sinking fund, and thus year by year the amount redeemed would be increased. The measure was approved by both sides; indeed, it was evident to everybody that in the present state of Europe it is only common prudence to reduce our debt while we may. We are now in a period of profound peace. The country is, happily, prosperous; taxation does not weigh heavily on any class; but the time may come when, against its will, the country may be dragged into war, and it may be necessary to pile debt upon debt. Mr. Goschen, however, finding it difficult to lay his hands upon a couple of millions a year for a purpose that appeared desirable in the eyes of his colleagues, diverted two millions from the reduction of the debt to the ordinary expenditure, and he sub sequently diverted more. Mr. Goschen defends his conduct by saying that the savings by his con version amount to about a year, and that in a dozen years or so the saving will amount to over two and a half millions, and that, therefore, he has not reduced the amount applicable to redemption of debt as fixed by Sir Stafford N orth cote. But this is a mere quibble. The intention of Parliament was to increase the sinking fund, leaving the total charge for the debt twenty-eight millions. Mr. Goschen has saved a large sum by conversion; but instead of devoting it to redeem ing debt, he has taken it, and more, to enable his Government to defray expenditure for which they did not dare to impose new taxes. If we could be sure of an indefinite period of freedom from foreign quarrels, we might acquiesce in the policy of the Chancellor of the Exchequer, though we could not approve it. But when we look at the state of the world, and call. To mind the various directions in which we may be attacked, no prudent man can avoid the conclusion that Mr. Goschen sacrifices the real permanent interests of the country to the temporary convenience of his Govern ment and party. Mr. Goschen asserts that by his conversion he has saved the country what is equivalent to 100 millions Of money. In other words, he reduced the interest of the debt immediately from 3 per cent. To 2% per cent., and by-and-by it will be reduced to 21; per cent. Thereby there will be an ultimate saving of nearly 2% millions per year.

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