Volume III Part 29 (1/2)

3. The war that began in 1739.

4. The war that began in 1756.

5. The American war, that began in 1775.

6. The present war, that began in 1793.

The national debt, at the conclusion of the war which ended in 1697, was twenty-one millions and an half. (See Smith's Wealth of Nations, chapter on Public Debts.) We now see it approaching fast to four hundred millions. If between these two extremes of twenty-one millions and four hundred millions, embracing the several expenses of all the including wars, there exist some common ratio that will ascertain arithmetically the amount of the debts at the end of each war, as certainly as the fact is known to be, that ratio will in like manner determine what the amount of the debt will be in all future wars, and will ascertain the period within which the funding system will expire in a bankruptcy of the government; for the ratio I allude to, is the ratio which the nature of the thing has established for itself.

Hitherto no idea has been entertained that any such ratio existed, or could exist, that would determine a problem of this kind; that is, that would ascertain, without having any knowledge of the fact, what the expense of any former war had been, or what the expense of any future war would be; but it is nevertheless true that such a ratio does exist, as I shall show, and also the mode of applying it.

The ratio I allude to is not in arithmetical progression like the numbers 2, 3, 4, 5, 6, 7, 8, 9; nor yet in geometrical progression, like the numbers 2, 4, 8, 16, 32, 64, 128, 256; but it is in the series of one half upon each preceding number; like the numbers 8, 12, 18, 27, 40, 60, 90, 135.

Any person can perceive that the second number, 12, is produced by the preceding number, 8, and half 8; and that the third number, 18, is in like manner produced by the preceding number, 12, and half 12; and so on for the rest. They can also see how rapidly the sums increase as the ratio proceeds. The difference between the two first numbers is but four; but the difference between the two last is forty-five; and from thence they may see with what immense rapidity the national debt has increased, and will continue to increase, till it exceeds the ordinary powers of calculation, and loses itself in ciphers.

I come now to apply the ratio as a rule to determine in all cases.

I began with the war that ended in 1697, which was the war in which the funding system began. The expense of that war was twenty-one millions and an half. In order to ascertain the expense of the next war, I add to twenty-one millions and an half, the half thereof (ten millions and three quarters) which makes thirty-two millions and a quarter for the expense of that war. This thirty-two millions and a quarter, added to the former debt of twenty-one millions and an half, carries the national debt to fifty-three millions and three quarters. Smith, in his chapter on Public Debts, says, that the national debt was at this time fifty-three millions.

I proceed to ascertain the expense of the next war, that of 1739, by adding, as in the former case, one half to the expense of the preceding war. The expense of the preceding war was thirty-two millions and a quarter; for the sake of even numbers, say, thirty-two millions; the half of which (16) makes forty-eight millions for the expense of that war.

I proceed to ascertain the expense of the war of 1756, by adding, according to the ratio, one half to the expense of the preceding war.

The expense of the preceding was taken at 48 millions, the half of which (24) makes 72 millions for the expense of that war. Smith, (chapter on Public Debts,) says, the expense of the war of 1756, was 72 millions and a quarter.

I proceed to ascertain the expense of the American war, of 1775, by adding, as in the former cases, one half to the expense of the preceding war. The expense of the preceding war was 72 millions, the half of which (36) makes 108 millions for the expense of that war. In the last edition of Smith, (chapter on Public Debts,) he says, the expense of the American war was _more than an hundred millions_.

I come now to ascertain the expense of the present war, supposing it to continue as long as former wars have done, and the funding system not to break up before that period. The expense of the preceding war was 108 millions, the half of which (54) makes 162 millions for the expense of the present war. It gives symptoms of going beyond this sum, supposing the funding system not to break up; for the loans of the last year and of the present year are twenty-two millions each, which exceeds the ratio compared with the loans of the preceding war. It will not be from the inability of procuring loans that the system will break up. On the contrary, it is the facility with which loans can be procured that hastens that event. The loans are altogether paper transactions; and it is the excess of them that brings on, with accelerating speed, that progressive depreciation of funded paper money that will dissolve the funding system.

I proceed to ascertain the expense of future wars, and I do this merely to show the impossibility of the continuance of the funding system, and the certainty of its dissolution.

The expense of the next war after the present war, according to the ratio that has ascertained the preceding cases, will be 243 millions.

Expense of the second war 364

---------------- third war 546

---------------- fourth war 819

-------- fifth war 1228

3200 millions;

which, at only four per cent. will require taxes to the nominal amount of one hundred and twenty-eight millions to pay the annual interest, besides the interest of the present debt, and the expenses of government, which are not included in this account. Is there a man so mad, so stupid, as to sup-pose this system can continue?

When I first conceived the idea of seeking for some common ratio that should apply as a rule of measurement to all the cases of the funding system, so far as to ascertain the several stages of its approach to dissolution, I had no expectation that any ratio could be found that would apply with so much exactness as this does. I was led to the idea merely by observing that the funding system was a thing in continual progression, and that whatever was in a state of progression might be supposed to admit of, at least, some general ratio of measurement, that would apply without any very great variation. But who could have supposed that falling systems, or falling opinions, admitted of a ratio apparently as true as the descent of falling bodies? I have not made the ratio any more than Newton made the ratio of gravitation. I have only discovered it, and explained the mode of applying it.

To shew at one view the rapid progression of the funding system to destruction, and to expose the folly of those who blindly believe in its continuance, and who artfully endeavour to impose that belief upon others, I exhibit in the annexed table, the expense of each of the six wars since the funding system began, as ascertained by ratio, and the expense of the six wars yet to come, ascertained by the same ratio.

[Ill.u.s.tration: Table318]

* The actual expense of the war of 1739 did not come up to the sum ascertained by the ratio. But as that which is the natural disposition of a thing, as it is the natural disposition of a stream of water to descend, will, if impeded in its course, overcome by a new effort what it had lost by that impediment, so it was with respect to this war and the next (1756) taken collectively; for the expense of the war of 1756 restored the equilibrium of the ratio, as fully as if it had not been impeded. A circ.u.mstance that serves to prove the truth of the ratio more folly than if the interruption had not taken place. The war of 1739 ***

languid; the efforts were below the value of money et that time; for the ratio is the measure of the depreciation of money in consequence of the funding system; or what comes to the same end, it is the measure of the increase of paper.