* * * * * *

It will be convenient, before embarking upon the actual chronicle of the military operations, to explain how the money was obtained to pay for the war.  I desire to avoid the intricate though fascinating tangles of Egyptian finance.  Yet even when the subject is treated in the most general way the difficulties which harass and impede the British administrators and insult the sovereign power of Egypt—­the mischievous interference of a vindictive nation, the galling and almost intolerable financial fetters in which a prosperous country is bound—­may arouse in the sympathetic reader a flush of annoyance, or at any rate a smile of pitying wonder.

About half the revenue of Egypt is devoted to the development and government of the country, and the other half to the payment of the interest on the debt and other external charges; and, with a view to preventing in the future the extravagance of the past, the London Convention in 1885 prescribed that the annual expenditure of Egypt shall not exceed a certain sum.  When the expenditure exceeds this amount, for every pound that is spent on the government or development of Egypt another pound must be paid to the Commissioners of the Debt; so that, after the limit is reached, for every pound that is required to promote Egyptian interests two pounds must be raised by taxation from an already heavily taxed community.  But the working of this law was found to be so severe that, like all laws which exceed the human conception of justice, it has been somewhat modified.  By an arrangement which was effected in 1888, the Caisse de la Dette are empowered, instead of devoting their surplus pound to the sinking fund, to pay it into a general reserve fund, from which the Commissioners may make grants to meet ’extraordinary expenses’; those expenses, that is to say, which may be considered ’once for all’(capital) expenditure and not ordinary annual charges.

The Dongola expedition was begun, as has been said, without reference to the immediate internal condition of Egypt.  The moment was a good one, but not the best.  It was obviously impossible for Egypt to provide for the extraordinary expenses of the military operations out of revenue.  The Ministry of Finance therefore appealed to the Caisse de la Dette for a grant from the general reserve fund.  Here was an obvious case of ‘extraordinary expenses.’  The Egyptian Government asked for 500,000 Egyptian pounds (EP500,000).

The Caisse met in council.  Six Commissioners—­representing England, France, Russia, Germany, Austria, and Italy—­duly discussed the application.  Four Commissioners considered that the grant should be made.  Two Commissioners, those representing France and Russia, voted against it.  The majority decided.  The grant was made.  The money was handed to the Egyptian Government and devoted to the prosecution of the war.