This would immediately raise the funds, and thereby would counteract the sinking fund itself in a very material degree.  Money would become abundant for all the purposes of trade, and it would be difficult

—–­ {193} A sort of ridicule has been thrown on the operation of compound interest, because its effects are so amazing as not to be capable of being realized; but, on this subject, two things are to be said,—­first of all, it has never been to the operation during the first hundred years that either incredulity or ridicule have applied, and the sinking fund was never meant to continue to operate so long.  Secondly, though there are many drawbacks on the employment of large sums laid out at interest, that diminish, and would at last destroy, the result of the calculation in accumulating; it is not so in paying off debt, where the effect calculated is produced with the greatest certainty. -=-

[end of page #241]

to find employment for it; and, if the progress continued, part of it would most undoubtedly be sent to other countries, and so be the means of impoverishing this.

If, then, we could suppose fifty years of peace, and that the national debt could be paid off, (as it might be in that time,) the situation of productive labourers would be worse; of unproductive, better; and, finally, capital would leave the country, which would be deprived of that transferable stock, the beneficial effects of which have been mentioned.

The necessity that creates industry would be diminished, so that nothing could tend more effectually to bring on the decline of the nation than if all the debt were to be paid off; an operation which, though possible in calculation, never certainly would take place; the evils attending it would be so manifest, so clear, and so palpably felt before that was accomplished.

To let the national debt continue to increase is, then, certain ruin, at some period unknown, but perhaps not very distant; to pay it off would be equally dangerous:  what then are we to do?

We must try to raise the resources necessary for war within the year, by which means we may avoid augmenting the debt.  That is not, however, to be done while the present heavy interest remains, and that cannot be got rid of, according to any method yet publicly known, without bankruptcy, breaking faith with creditors, or paying off the debt; a resource in itself dangerous, and one that, after all, would bring relief at a very distant day.

Since the debt has been contracted, let it be kept up; but let a mode be taken of reducing the interest, without breaking faith with the creditors of the state, so that we may never be obliged to borrow any more.

At present, the sum that goes annually for interest, and for the sinking fund, (that is for paying off capital,) amounts to twenty-four millions, and the expenses of a year of war do not exceed that sum.  Twelve millions of this may be found by war-taxes, and twelve millions diminution of the interest would just leave a residue sufficient to pay for a constant state of war; and, if peace came, the war-taxes would be taken off.  The enemies of England would then not be able to make notches [end of page #242] in a stick, and say, “When we come to such a notch England will be ruined.”