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thought, perhaps, that something may be gained by the compound interest which the sinking fund accumulates. But it is evident that no compound interest can accumulate on a sum of borrowed money, because the interest must be paid annually. Although the interest were borrowed, this would not alter the case. It would no doubt allow the sinking fund to accumulate; but the borrower would, in the mean time, accumulate his debts in the same proportion. It is impossible that the circumstances either of a nation, or of an individual, can be altered, by accumulating a fund of borrowed money.

We have already endeavoured to shew, that the interest and sinking fund of the war loans is really paid by the supplementary loans, the intervention of the war taxes being noway necessary for that purpose. The supplementary loans, however, are borrowed. By setting apart, therefore, a portion of them for a sinking fund, we are accumulating debt as fast as we are accumulating funds for its payment. The sinking fund will leave our affairs precisely in the same situation in which it found them: But although we conceive that these provisions respecting the intervention of the war taxes and the sinking fund, might be dispensed with, we do not think that they will contribute in the slightest degree to defeat the great object of the measure, far less will they be attended with ruinous consequences to the finances of the country.

We are aware, indeed, that a contrary opinion has been asserted, and that a great deal of absurd declamation has been poured forth upon this topic, in order to discredit the measure. A series of financial resolutions is said to have been moved in the House of Commons by Lord Castlereagh, in which it was actually pretended, that by the plan of double loans, i. e. by bor rowing annually 10 per cent. on the principal loans, 5 per cent. for interest, and 5 per cent. for a sinking fund, a loss of twentynine millions would be ultimately incurred by the public. Now, it may be asked, how can this happen? By what process, in the mysterious art of borrowing and lending money, can such unheard of results be produced? To borrow annually 5 per cent. to be set apart as a sinking fund for the redemption of debt, is, we allow, a nugatory operation. But as long as what is borrowed is neither wasted nor misapplied, we cannot well conceive how money can in this way be either saved or lost. We throw out these plain considerations for the benefit of the noble person alluded to, and of all future calculators. We are sanguine enough to hope, that if they duly attend to them, they will not plod on from blunder to blunder, through a mass of laborious calculations, until their imagination, heated with the prospect of

VOL. X. NO. 19.



great discoveries, scorns the sober results of arithmetic, and will
be content with nothing short of the marvellous. We will not
be so cruel as to annoy our readers with all the idle details of
those resolutions. We may however subjoin, as a specimen of
their general truth and accuracy, the following calculations, in
which the expense of redeeming a principal, by means of a one per
cent. annuity, is contrasted with the expense incurred by means
of Lord Henry Petty's plan. The sum to be redeemed is twelve

Ten per cent. interest and sinking fund on 12,000,0001. for one
L. 1,200,000

A like charge for thirteen years more, at which time
the principal is redeemed


Total payments L. 16,800,000

To cover the interest and sinking fund of 1,200,0001. at six per cent., a fund of 72,0001. must be provided in each of the fourteen years; the amount thereof is 1,008,0001.

The latter sum being raised on a one per cent. sinking fund, may be considered as an annuity of fortythree years.

Payments on account thereof

Payments as above


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The interest and sinking fund on a loan of 12,000,0001., at six

per cent., amounts, per annum, to 720,0001.

This charge being raised on a one per cent. sinking fund, may be considered as an annuity of forty-three years.

Payments to be made on account thereof till its redemption, 30,960,0001.

Payments on new system, upon a loan of 12,000,0001.

Ditto on present system

L. 60,144,000


Excess of the charge of redemption by new system L. 29,184,000 It is evident that two plans are here compared, which are in all respects totally different from each other; and that, while the expenses of what is called the new plan, are very absurdly exaggerated, its benefits are in a great measure overlooked. The ingenious calculator seems so intent on swelling out the debtor side of the account, that he has omitted the creditor side altogether.

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He has thus committed a mistake of about the same magnitude as that of Sir Francis Wronghead, when he said Aye, instead of saying No. But besides the arithmetical errors into which he has fallen, no sound principle is laid down for comparing the relative advantages or disadvantages of the two different plans. The scheme by which he pretends to estimate the expense of the new plan, is peculiarly unsatisfactory; and even if his calculations were correct, they are quite inconclusive. All consideration of compound interest seems to be wholly excluded, without which, however, it is impossible to enter with any certainty into the complicated details of loans, annuities or sinking funds, on a great scale. The truth of these observations will appear from a more particular consideration of the scheme. The expense of redeeming a debt of 12,000,000l., by means of a sinking fund of 5 per cent., is first considered, and it is estimated at 16,800,0001.; the expense of redeeming 16,800,0001. by an annuity of 1 per cent., is next calculated at 43,344,000l.; and the sum to be redeemed is added (upon what principle we are utterly at a loss to conceive) to the expense of redemption, by which the whole charge is made to amount to 60,144,000l. It is, however, evidently an error, to add the sum to be redeemed to the charge for redemption, as that charge cannot possibly be incurred till the original sum be paid. The 16,800,0001. must therefore be deducted; which will reduce the expense to 43,344,0001. The expense of redeeming 12,000,000l., by a 1 per cent. annuity, is next compared with the expense of redeeming 16,800,0001. by an annuity to the same amount; and it does not require very deep thought to perceive, that it will cost more to redeem the latter sum than the former. The question to be considered therefore is, whether value has been received for the 16,800,0001. It appears that half of that sum has been paid for the interest of the 12,000,0001. during fourteen years; and the other half has been set apart as a sinking fund to redeem the principal. With 16,800,0001., therefore, the interest of 12,000,000l. for fourteen years has been paid, and the principal has been redeemed; and were we to imitate the exexample of inaccuracy set before us, we should immediately conclude that a great advantage was gained by this plan. But this advantage is merely apparent; and it only shews what a fertile source of error is opened, by adopting such an imperfect mode of calculation.

Indeed, all calculations must be exceedingly lame and inconclusive, from which the consideration of compound interest is excluded. The true nature of the transaction will appear from the following simple considerations. A sum of 12,000,0001. is bor rowed, and an annuity of 1,200,0001. is borrowed along with it,

by which, in fourteen years, the principal is redeemed, and the interest is also paid. An annuity of 1,200,0001. for fourteen years is therefore given in exchange for a capital of 12,000,0001., and for the interest of that capital for fourteen years. The value of the interest of 12,000,0001. for fourteen years, is exactly 12,000,000l.; and an annuity of 1,200,0001. for the same period, is worth 24,000,000l.; so that there can neither be loss nor gain on the transaction. Besides the most ridiculous blunder of adding the sum to be redeemed to the expense of redemption, Lord Castlereagh has forgot to credit the plan with the interest of 12,000,0001. for fourteen years, for which it is evident that the 16,800,0001. pays.

Although, however, the labours of the noble Lord do not appear to us to have been, in the present inftance, attended with profperous refults, we very willingly allow, that great depth and comprehenfion of judgment have been difplayed in the construction of thefe formidable calculations. His genius feems peculiarly fitted for arithmetical ftudies, and we difcover with pleasure that it is in the moff common, and confequently the most useful, fort of arithmetic, that his talents appear chiefly to fhine. In this great crifis of human affairs, it is peculiarly gratifying to reflect, that while the French youth are taught almost exclusively to glory in feats of arms, men of rank in this country, with a virtuous diftafte for warlike purfuits, are ftudious to excel in the more innocent, and certainly not lefs wonderful talent, of fpeaking for an hour, and faying nothing.

We cannot conclude our remarks on this fubject, without obferving, that the great debt of this country, and the difficulty of finding out new fources of taxation, has not only fecured to financial difcuffions that attention which their importance fo well defervés; but it has exalted them among a certain clafs of politicians above all the grand objects of national policy. The state of a nation's finan ces is now habitually referred to as a fure criterion of her power; and from the language often held on this fubject, it might be imagined, that the whole duties of a statefman centred in devising eafy methods of railing money. During the laft war we were told that France was on the verge, and even in the very gulph of bankruptcy, and our own flourishing finances were at the fame time brought very oftentatioufly under our review. We still hear on every occafion about our proud ftructure of finance,' &c.; and the praifes of Mr Pitt generally bring up the rear of this heavy declamation. Now, if France, fince the ruin of her finances, has trampled on the necks of all her enemics, and has rifen to unexampled preeminence and power, and if Britain, with her flourishing finances, has been unable to prevent the destruc

tion of her allies, and instead of attaining for herself permanent fecurity, fees every day new perils thickening around her, we may well inquire, what fruits have our flourishing finances produced? and what has it availed us, that a large revenue has been collected, if it has been lavished on futile or difaftrous projects? So enamoured are these declaimers with taxation, that they seem to confider it as an ultimate object of policy. They do not reflect that it is not fo much by railing a revenue, as by a wife application of it, after it is configned into his hands, that a statesman can either benefit his country, or acquire lafting renown for himfelf. In illuftration of thefe obfervations, we might refer to that period of our hiftory when the glorious fabric of European independence was firft reared. Thote who aflifted in bringing about that event were undoubtedly great ftatefmen; and the wonderful work which they accomplished is the charter of their wellearned fame. This fame, however, they acquired, not by raifing a great revenue, but by working wonders with a small one; and it is a fame in which none need hope to participate, who with far ampler means have failed in the attainment of much humbler ends; and, inftead of rendering England the arbitrefs of nations, have reduced her to maintain an anxious firuggle for her fecurity and independence.

ART. VI. A Portraiture of Quakerism, as taken from a View of the Moral Education, Discipline, Peculiar Customs, Religious Principles, Political and Civil Economy, and Character, of the Society of Friends. By Thomas Clarkson, M. A. Author of several Essays on the Subject of the Slave-Trade. Svo. S vol. London. 1806.

THI HIS, we think, is a book peculiarly fitted for reviewing: for it contains many things which most people, will have some curiosity to hear about; and is at the same time so intolerably dull and tedious, that no voluntary reader could possibly get through with it.

The author, whose meritorious exertions for the abolition of the slave trade brought him into public notice a great many years ago, was recommended by this circumstance to the favour and the confidence of the Quakers, who had long been unanimous in that cause; and was led to such an extensive and cordial intercourse with them in all parts of the kingdom, that he came at last to have a more thorough knowledge of their tenets and living manners than any other person out of the society could easily obtain. The effect of this knowledge has evidently been to ex



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