Luxemburg in 1815 was not merely severed from the Netherlands; it, as a sovereign grand-duchy, was made a state of the Germanic confederation.  By virtue of the exchange sanctioned by the treaty of 1839, the ceded portion of Limburg became a state of the confederation.  But with the revision of the Dutch constitution, which in 1840 followed the final separation of Holland and Belgium, by the wish of the king his duchy of Limburg was included in the new Fundamental Law, and thus became practically a Dutch province.  The Limburgers had thus a strange and ambiguous position.  They had to pay taxes, to furnish military contingents and to send deputies to two different sovereign authorities.  This state of things continued with more or less friction, until the victory of Prussia over Austria in 1866 led to the dissolution of the Germanic confederation.  At the conference of London, 1867, Luxemburg was declared to be an independent state, whose neutrality was guaranteed by the Great Powers, while Limburg became an integral portion of the kingdom of the Netherlands.

Since the middle of the last century the financial position of Holland has been continuously improving.  The heavy indebtedness of the country, in the period which followed the separation from Belgium, was gradually diminished.  This was effected for a number of years by the doubtful expedient of the profits derived from the exploitation of the East Indian colonies through the “Cultivation System.”  With the passing of the revised Fundamental Law of 1848 the control of colonial affairs and of the colonial budget was placed in the hands of the States-General; and a considerable section of the Liberal party began henceforth to agitate for the abolition of a system which was very oppressive to the Javanese population.  It was not, however, until 1871 that the reform was carried out.  Meanwhile, chiefly by the efforts of Thorbecke, the methods of home finance had been greatly improved by the removal, so far as possible, of indirect imposts, and the introduction of a free trade policy, which since his days has been steadily maintained.  Such a policy is admirably suitable to a country which possesses neither minerals nor coal[15], and whose wealth is mainly due to sea-or river-borne trade, to dairy farming and to horticulture.  For its supply of corn and many other necessary commodities Holland has to look to other countries.  The fisheries still form one of the staple industries of the land, and furnish a hardy sea-faring population for the considerable mercantile marine, which is needed for constant intercourse with a colonial empire (the third in importance at the present time) consisting chiefly of islands in a far-distant ocean.

Between 1850 and 1914, 375,430,000 fl. have been devoted to the reduction of debt; and the Sinking Fund in 1915 was 6,346,000 fl.  Since that date Holland has suffered from the consequences of the Great War, but, having successfully maintained her neutrality, she has suffered relatively far less than any of her neighbours.  Taxation in Holland has always been high.  It is to a large extent an artificial country; and vast sums have been expended and must always be expended in the upkeep of the elaborate system of dykes and canals, by which the waters of the ocean and the rivers are controlled and prevented from flooding large areas of land lying below sea level.