In so far as the debt was raised at home, the war was paid for by those who bought the securities offered, and we have now to pay them interest and set about repaying them the capital.  This process will not diminish the national wealth, but will only affect its distribution.  It will not diminish the amount of available capital, but may even rather increase it by gathering into the hands of the debt-holders—­who are ex-hypothesi folk with an inclination for saving—­money that might, if left in the hands of those from whom it is collected, have been squandered.  The payment of the debt charge merely means that those who came forward with their money when they were asked to subscribe to war loans, have, according to the extent of the effort that they then made, a set-off against the subsequent taxation involved by the war debt.  It would have been a much simpler and more businesslike proceeding to have taken, instead of borrowing, a much larger proportion of the war’s cost during the war; but it is too late now to rub in this platitude which is now pretty generally admitted.  Mr Hoare showed in last month’s Journal that the creation of the War Debt has caused a huge addition to what he has called Rente—­the gross income of the propertied classes; and there is much logic in his contention that this income is the source from which the debt charge should be met.  At the same time both justice and economic expediency seem to demand that his wider interpretation of Rente, to make it include the earnings of those whose special qualifications (or, we may add, special luck) put them in a position to earn more easily than the struggling majority, should be applied to taxation involved by the debt charge.

How, then, shall we deal with the debt?  In the first place we want a good Sinking Fund—­1 per cent. at least—­and all realisations of assets in the shape of loans repaid, ships, etc., sold, should be used for reduction of our foreign debt.  For the home charge we want a special form of income tax that will fall as lightly and indirectly as possible on industry; that is, that it should be imposed on the individual taxpayer direct.  So that what we want is an extended, reformed and better graduated form of the super-tax brought down so low that every one who is not merely rich but comfortable should pay his share, For example, any single man or woman with any excess over L500 a year of unearned income, or over L800 a year of earned income might well pay super-tax on that excess.  The exemption limit might well be raised by 50 per cent. for married couples (if their joint incomes are still to be counted as one), and by L100 a year for each child between the age of five and twenty-five.  But all these figures are mere suggestions, and the details of the scheme would have to be worked out by Inland Revenue officials, whose experience and knowledge of the practical working of such matters qualifies them for the task.  The broad principle is a special tax for the debt charge