8

11

soap, stone bottles, starch, 10 stained paper, and bricks.12 In the customs the import duties were removed on most of the raw

regretted that Leblanc himself never received any reward for his admirable discovery, and lived in poverty and despair. In this country Leblanc's process was first introduced in 1814, on a limited scale, for the preparation of soda crystals, which were then sold at 601. per ton; but it was not till 1823 that common salt, having been relieved from taxation, Mr. Muspratt's works at Liverpool were erected, laying the foundation of a manufacture of chemical products which has since become the largest in the world. At first, so great was the benefit derived from the simple conversion of the chloride of sodium into soda, that the muriatic salt produced by it was not collected. It was soon, however, found that it was a compound of chlorine which possessed great bleaching properties. It became then an object of moment to separate the chlorine from the muriatic acid, and this was attained by mixing it with peroxide of manganese and sulphuric acid as a dense suffocating yellow gas. And as it was inconvenient to transport it either as liquid muriatic acid or as gaseous chlorine, it was combined with lime, thus forming a hypochlorite of that substance known as chloride of lime, or bleaching powder, used for purposes of disinfection, bleaching linen and cotton goods, rags for the manufacture of paper, &c. Thus by a variety of agencies, and by the concurrence of many varied circumstances, the utility of salt has been immensely increased. In a valuable paper on the subject in the Journal of the Society of Arts, vol. i. p. 425, by Mr. Owen Huskisson, the processes involved in the manufacture of salt were minutely described, and its uses summed up as follows: It is used in the arts as a coarse glaze for pottery; gives hardness to soap; improves the whiteness and clearness of glass. In dyeing it is used as a mordant, and for improving certain colours. It preserves melting metals from oxidation, by defending their surface from the air. It is employed with advantage in some assays, and enters into many other important processes. To the chemist it is valuable, as a source of soda and chlorine and their compounds, from which he obtains the chloric acid, and combines with potash to form chlorate of potash, so largely used in the manufacture of lucifers. To the agriculturist salt is useful as a manure and dressing to certain lands. It is used at the table as a flavouring or seasoning agent, being a necessary article of food, essential for the preservation of health and the maintenance of life. It is also largely used in the preservation and curing of alimentary substances. In medicine it is used as a vomit, purgative, to restore the saline constituents of the blood, alterative, astringent, dentifrice; as an external application to sprains and bruises; its tonic power proves useful in dyspepsia, and promotes digestion, and in correcting the weakened state of the intestines which favours the propagation of worms. Dissolved in water it forms a stimulating bath, and is a chemical antidote against poisoning by nitrate of silver.' The manufacture of alkaline products is itself a most important industry in Newcastle, on the shores of the Tyne, and Lancashire. The economist or the student who wishes to find illustrations of the opposing influences of taxation and science on industrial process, will find a mine of information in the reports of the juries for the International Exhibitions of 1851 and 1862, and more especially in the report on chemical products and processes at the latter exhibition by Dr. Hoffman. Truly the resources which nature offers to our use are inexhaustible, and are still but imperfectly fathomed. How much do we owe to those illustrious few who, wonderfully rich in their power of analysis and depth of intellect, are fortunate enough in laying bare those mysteries which have so long defied the keenest and most patient investigations.

A duty of 6d. per yard on printed silks was repealed in 1826.

The duty of 34d. per square yard on printed cottons was repealed in 1831.

The licence to calico printers of 201. was also repealed.

In 1832 the duties of 1d. per lb. on tallow candles and 34d. on wax and spermaceti candles were repealed, and the licence duty to candle makers of 21. and 51. was also repealed.

'The duties on tiles were repealed in 1833.

For notes 8, 9, 10, 11, and 12, see next page.

materials, and on coals imported coastwise, as well as all export duties on British goods and on coals. Reforms had also been made in the stamp duties, on life and marine insurance, bills of lading, pamphlets, advertisements, and newspapers. Yet with all this much remained to be done to free industry from unnecessary burdens. Unfortunately, however, a pamphlet published by Prince de Joinville, a letter by the Duke of Wellington, a volume by Sir Francis Head, excited considerable apprehensions regarding the state of the army and navy. The coup d'état of Napoleon III. in 1852 was regarded as the first step in a career of conquest, and the result was a large increase on the expenditure, always fatal to financial reforms.

It was under these untoward circumstances that Mr. Gladstone succeeded to the management of the finances of the country in 1852; yet in that very year he made the first of those financial statements which, like those of Sir Robert Peel, rendered the delivery of the budget an occasion of absorbing interest to the community. The condition of the revenue was indeed better than Mr. Disraeli had anticipated; but a large sum was required, and the first question for Mr. Gladstone to solve was, Shall the income tax be reimposed? The tax had been in operation from 1799 to 1802, from 1806 to 1815, and from 1842 to 1852. In a time of great difficulty it enabled the Government to raise the income of the country above its expenditure. At another time it had been the instrument by which the Government were enabled to introduce most useful reforms. Why should the Government not resort to such expedient once more, in order to perfect the reforms which were still needed in the commercial and fiscal system? And this was Mr. Gladstone's resolve, though he had serious objections to that method of taxation. 'The general views of her Majesty's Government with respect to the income tax, concluded Mr. Gladstone, are, that it is an engine of gigantic power for great national purposes; but, at the same time, that there are circumstances attending its operation which make it difficult, perhaps impossible, at any rate in our opinion not desirable, to maintain it as a portion of the permanent and ordinary finances of the country. The public feeling of its inequality is a fact most important in itself. The inquisition it entails is a most serious disadvantage, and the frauds to which it leads are an evil which it is not possible to characterise in terms too strong.' Having

In 1833 the soap duties were reduced to one-half the former rates, viz., hard to 1d. per lb., and soft to 1d. per lb. In 1853 they were repealed. The duty of 5s. per cwt. on stone bottles was repealed in 1834. The duty on starch of 31d. per lb. was repealed in 1834.

"In 1836 the duty of 13d. per square yard on stained paper was repealed. The licence to stained paper makers, 47., was repealed, and the paper duty reduced to one uniform rate of 1d. per lb.

12 In 1839 the duties on bricks were reduced, and in 1850 repealed.

thus decided upon the renewal of the income tax, and upon extending the probate duty over both real and personal property, Mr. Gladstone discussed the proposed remission of taxation.

The first item in his budget under this head was the excise duty on soap, a tax most injurious to the comfort and health of the people, and a burden on manufacturing industry, soap being extensively employed in many processes of manufacture. The excise had established many stringent regulations in order to arrest the surreptitious production of soap, but whilst they were powerless to prevent the making of soap secretly without taking out any licence, they effectively prevented improvements in the processes, so that the quality of soap made in foreign countries, where no such regulations were imposed, was invariably superior to that of English soap. The duty, moreover, was injurious as affecting one of the chief ingredients used in manufactures, and it was so regulated that our manufacturers were in a manner compelled to employ a material which was not calculated to produce soap of the finest quality. The duty down to 1833 was at the rate of 3d. per lb. on hard soap, and 14d. per lb. on soft soap, besides the taxes on the raw materials used in its manufacture, such as tallow, barilla, and turpentine or resin, the direct and indirect taxes together forming 120 to 130 per cent. ad valorem. In 1833 the duty was reduced 50 per cent., or to 14d. per lb. on hard and 1d. per lb. on soft soap, and so it remained till 1853, when, though the amount of revenue produced by it was upwards of 1,000,000l., the duty was entirely abolished.

The next important reform was in the tea duty, which was at the high rate of 28. 24d. per lb. When tea was first used in this country a duty of 8d. a gallon was charged on the decoction made from the leaves, but soon after it was changed into a duty of 58. per lb. on the tea itself. With such a high duty, however, as this, smuggling was easy and profitable, and the revenue suffered considerably. In 1745 the necessity of checking this illegitimate traffic having become indispensable, on the recommendation of a committee of the House of Commons, the duty was reduced at least 50 per cent., and the measure succeeded admirably, both commercially and financially. But the Legislature did not understand the economic laws which regulate the consumption of such articles, and in 1759 it again increased the duty from 65 to 120 per cent. Again, however, smuggling became general. The honest dealer was beaten out of the market by the unfair competition of the smuggler, and much temptation to adulteration was thereby afforded. Once more, therefore, the Legislature tried to remedy this evil, and following the precedents of 1745, in 1784 the duty was reduced from 119 per cent. to 12 per cent. For some time this policy was persisted in with great success, but the exigencies of war in 1795 threw all economic considerations out of view. The

BB

duty was first increased from 12 to 25 per cent.; then by successive augmentations it was raised to 96 per cent. ad valorem, at which rate it continued till 1819, when the duty was raised to 100 per cent. on all tea worth more than 2s. per lb. at the Company's sales. In 1834 the duties were somewhat modified, and in 1830 a uniform duty of 28. 1d. per lb. was imposed, to which 5 per cent. was added in 1840. At that rate it continued, till in 1853 Mr. Gladstone reduced the duty to 18. 10d. per lb., with prospective further reductions to 18. per lb., which, however, the Russian war soon after arrested for some time.

The principle which Mr. Gladstone adopted in the reform of the tariff, was, first, to abolish altogether the duties which were unproductive, except in cases where there might be some special reasons for retaining them on account of their relation to other articles; and in the next place to abolish, as far as considerations of revenue would permit, duties on articles of manufacture except those which were in the last stage as finished articles, and were commonly connected with hand labour-for, in regard to these cases, he thought it more prudent and proper to proceed in the mode, not of abolition, but of reduction. As a general rule, such duties were not to be higher than 10 per cent., but he allowed the silk duties to remain at 15 per cent., out of consideration to a certain class of operatives. He substituted rated duties for duties ad valorem; abolished the 5 per cent. addition to customs duties made in 1840; put an end to all differential duties by lowering those on the foreign article to the level of those on the colonial; lowered the duties on many articles of food, and set altogether free 123 articles which produced but a small amount of revenue. Mr. Gladstone anticipated that such remissions would act not only upon the consumers of particular articles, enabling them to increase their particular consumption of the various articles, but that they would act upon consumers generally, and that they would operate powerfully in the extension and invigoration of the trade of the country. These,' he said, ' are the proposals of the Government. They may be approved or they may be condemned, but I have at least this full and undoubting confidence, that it will on all hands be admitted that we have not sought to evade the difficulties of our position; that we have not concealed those difficulties either from ourselves or from others; that we have not attempted to counteract them by narrow or flimsy expedients; that we have proposed plans which, if you will adopt them, will go some way towards closing up many vexed questions -questions, such as, if not now settled, may be attended with public inconvenience, and even with public danger, in future years.'

Another financial operation was proposed by Mr. Gladstone in connection with the budget of 1852, but it was not equally suc

cessful. He wished to create a 21. 10s. stock, and he offered to the holders of 3 per cent. either to change it for a new 3 per cent. stock, guaranteed against redemption for forty years, at 82l. 108. of the new for every 100l. of the old stock; or a new 2 per cent., also guaranteed against redemption for forty years, at the rate of 110%. of the new for every 100l. of the old, or for exchequer bonds at par. The plan was favourably received at first, but no one seemed to act upon it, and eventually only about 3,000,000l. of 23 per cent. stock was taken. In truth, the strength of Mr. Gladstone's operation was the expectation of great changes in the value of money from the discoveries of gold, and as these were not realised no disposition existed to relinquish the 3 per cent. stock, which amounted to 500,000,000l.

Any further attempt at financial reforms was to some extent arrested by the war with Russia; yet, in 1853, the great reform was made in the tax on receipts, by reducing the duties from various rates to one uniform rate of 1d.; and in 1854 the stamp duties on bills of exchange were greatly reduced. Besides this, in that year the method of paying customs duties by cheques was first introduced, which relieved the trader from all risks in the transmission of notes and coin, the customs department of much needless labour, and bankers of the necessity of keeping a large amount of notes on hand to meet the demands of their customers. In this way a considerable economy in the use of bank notes and coin was effected, and the payment of customs duties was reduced to a system of transfer of credits in the books of private bankers and those of the Bank of England.

6

Nor must we omit to notice that when the Russian war necessitated a large increase of the expenditure, and a great temptation to resort to loans as in former years, Mr. Gladstone was the first to protest against throwing the burden of present calamities on a future generation. It was desirable, he thought, to make the nation feel the evils of a war expenditure by allowing it to encroach on their comforts. The expenses of a war,' said Mr. Gladstone, are the moral check which it has pleased the Almighty to impose upon the ambition and the lust of conquest that are inherent in so many nations. There is pomp and circumstance, there is glory and excitement about war, which, notwithstanding the miseries it entails, invests it with charms in the eyes of the community, and tends to blind men to those evils to a fearful and dangerous degree. The necessity of meeting from year to year the expenditure which it entails is a salutary and wholesome check, making them feel what they are about, and making them measure the cost of the benefit which they may calculate.'