Wilkeson draws between a public and a private debt, which he informs us are as different from each other as night is from day. Prof. Hamilton, however, like all other writers of eminence, is of the opposite opinion; and he illustrates his view. of the subject as follows: "A private gentleman, whose estate is encumbered, may, if he have any credit, pay off all his debt every year by borrowing money from other hands; but if he spends more than his free income, his embarrassments will continually increase; and his affairs are so much the worse by being conducted in this manner, from the fees he pays to his agents. The absurdity of deriving any satisfaction from this annual discharge of his debts will appear still stronger if we suppose him, instead of borrowing from other hands, only to renew the securities to the same creditors, annually paying a fee to the agents, and a douceur to the creditors themselves, on the renewal. All these observations are equally applicable to the debt of a nation conducted as ours is. It would not be impracticable or very difficult to redeem our whole debt in any year if the measures we follow be redemption. It would only require a large loan every month; and the large sums we were thus enabled to pay would supply the funds for these loans. Our capitalists would be well pleased to promote. these loans, as they would derive a bonus from each. Such a system would be ruinous in the extreme; and the system we follow is the same on a smaller scale, and is therefore only pernicious in a less degree."*

Although Mr. Wilkeson does not seem to have very carefully studied the subject upon which he has written, we have little doubt that, if he were asked who is the most reliable British writer on political economy, he would not hesitate to award that distinction to Dr. Adam Smith, author of The Wealth of Nations. The superior authority of this work is universally acknowledged throughout the Continent, as well as in England; but does the author agree with Mr. Wilkeson in regarding the debt of a nation as an addition to the nation's wealth? We shall presently see. The chief means of increasing the public debt is war; then, if a large permanent debt is a blessing, surely war cannot be very seriously condemned, notwitstanding its manifold horrors, though it be productive of no other benefit to those who carry it on. But, in commenting on this branch of the subject, Dr. Smith observes: "Had not these wars given this particular direction to so large a capital, the greater part of it would natu* lb., p. 191. 9

VOL. XI,-NO. XXII.

rally have been employed in maintaining productive hands, whose labor would have replaced, with a profit, the whole value f their consumption. The value of the annual produce of the land and labor of the country would have been considerably increased by it every year; and every year's increase would have still more augmented that of the following year. More houses would have been built, more lands would have been improved, and those which had been improved before would have been better cultivated; more manufactures would have been established, and those which had been established before would have been more extended; and to what height the real wealth and revenue of the country might by this time have been raised it is not perhaps very easy even to imagine.*

Perhaps Mr. Hume exaggerated the danger of the national debt of England when the stated, in his "Essay on the Public Credit," that either the country must destroy the debt, or the debt will destroy the country; it is sufficient for us to know that the most profound thinkers of Great Britain have regarded the national debt in a very different light from that of a blessing.

Nor do the political economists of Italy, France, or Germany take a more favorable view of its operations or influence. "A country," says Ricardo, "which has involved itself in the difficulties attendant on a large public debt would act wisely in ransoming itself from them, at the sacrifice of any portion of its property which might be necessary for the redemption of the debt." Those who have most debt to pay are apt to think most on the subject; and accordingly we find that next to the English, of all Europeans, the French have written most on national debt. If any of them have maintained that it is a blessing, the fact has escaped our attention, or our memory. "The habit, or necessity of living by expedients," says M. Maury, "is not less dangerous for nations than for individuals. In casting itself into the easy way of loans, the nation places itself on a rapid declivity, where it is no longer possible for it to stop; and at the bottom of which it almost always falls into that abyss of misery and shame which is called national bankruptcy "†

* Wealth of Nations, vol. ii., p. 119, McCulloch's edition.

L'habitude ou a nécessité de vivre d'expédients n'est pas moins dangereux pour les peuples que pour les individus. En se jetant dans la voie facile des emprunts on s'est placé sur une pente rapide, où il n'était plus possible de s'arrêter, et au bout de laquelle on est presque toujours tombé dans cet abîme de misére et de honte qu'on appelle la banqueroute publique.Hist. financiere de la France, par M. Bresson, tome ii., p. 250.

If we inquire who is the greatest authority among celebrated writers, we shall find that it is Montesquieu, the illustrious author of De l'Esprit des Lois : then, if we examine his ample pages, we shall see that neither Professor Hamilton, Mr. Hume, Dr. Adam Smith, nor any other writer whatever is more decided in the opinion that a large national debt is injurious to any nation that is burdened with it. Not but in Montesquieu's time as well as now there were persons who believed that it was no harm, but rather good, for a nation to be indebted to itself. "Quelques gens," says the philosopher, "ont cru quil étoit bon qu'un etat dût à luimême; ils ont pensé que cela multiplioit les richesses en augmentant la circulation."* This shows that the ideas of Mr. Wilkeson are at least more than a century old, but it also shows that even then they had been exploded as fallacious. Montesquieu explains how the mistake occurs on a superficial view. He shows the disadvantages which a nation labors under by being burdened with a large debt, and then admits that, if there are advantages arising from the same cause, he does not know in what they consist. "Volá les inconvéniens," he says, "je n'en connois point les avantages." He then proceeds to illustrate his view. If ten persons, he says, have each a thousand crowns of revenue in landed funds or business, this produces for the nation, at five per cent., a capital of two hundred thousand crowns. If these ten persons employ the half of their revenue, that is to say, five thousand crowns, to pay the interest on the hundred thousand crowns they have borrowed from others, that still produces for the state but two hundred thousand (crowns; that is, in the language of the algebraists, 200,000 crowns-100,000 crowns -- 100,000 crowns = 200,000 crowns."+

He now shows how the mistake is generally made, namely by regarding paper which is but the representative of money or wealth as the thing itself. But we will let the philosopher give the idea in his own language: "Ce que peut jeter dans l'erreur," he says "c'est qu'un papier qui représente la dette d'une nation est un signe de richesse; car il n'y a qu'un etat riche qui puisse soutenir un tel papier sans tomber dans la décadence; que s'il n'y tombe pas il faut que l'état ait de grandes riches d'ailleurs." This is undoubtedly the philosophy of the subject—that is, instead of a large public debt adding to the wealth of a country, none but a rich coun

try can sustain a large debt, or save itself from decay. If a country is rich notwithstanding its great debt, it is not on account of the debt, it is so but in spite of it; in other words, if it does not break down under the pressure of the debt, it is because it has great riches independently of it. This is the case with us as well as with England. Our seven-thirty bonds are safe and productive capital to those who invest in them, not because our national debt is large, but because we have almost inexhaustible resources, and possess sufficient enterprise, industry, and skill to turn those resources to the best advantage.

As Mr. Wilkeson makes the debt of England the criterion whereby we are to judge in every particular of the effects of our debt, ought he not to have reminded us that we have accumulated our debt at a much larger ratio than England. England has been engaged in more wars in one decade than we have been during the whole period of our existence, and her enemies have been the most powerful and most warlike nations in the world. Not only has she had to support her own army, but also to pay large subsidies to the armies of her continental allies; there have always been some of her colonies from which she has derived no revenue, but which have been a loss to her rather than a gain. At other times, she has found it necessary to make war on her colonies thousands of miles from home. We have had only to protect ourselves at home, with the broad Atlantic between us and all the great powers. Yet, if we compare our debt with that of England, what a near approach does the former make to the latter! Why, if we are to regard the interest as the measure of the burden, as we are told to do by Mr. Wilkeson, our debt is the largest in the world, not excepting that of England, which has been accumulating for nearly four centuries. In the comparative table already referred to, the interest of the debt of the United States is given as $165,000,000, and that of the debt of Great Britain as $127,564,548. It is important not only that this fact should be known, but that it should be remembered and pondered upon, so that it may exercise a salutary influence on future expenditures.

But if we have thus felt it our duty to refute certain erroneous theories of Mr. Wilkeson, we are not the less disposed to give him credit for any theory or suggestion that is founded on reason and truth; and we regard in this light the statement that "the national debt will be the bond of our Union ;"' for there are many things that are not good in themselves,

but the reverse, which, by producing a community of interest and feeling, serve to unite in one brotherhood those who might otherwise be at constant enmity with each other. But we will let Mr. Wilkeson state the case in his own words:

"This, our national war debt, should be held forever in place as the political tie of the states and the bond forever of a fraternal nationality. It will give a common interest in the Union that nothing else can give. It will impart to a copartnership between thirty-five millions of people the unity of feeling arising from a community of interest in a copartnership capital of three thousand millions of dollars. Tied to the Union by the Union debt, nor Western States, nor Southern States-states beyond the Rocky Mountains, nor states by the Atlantic Sea-states that plant, nor states that weave-states that mine, nor states that smelt and hammer, can ever find inducement in sectional interest to draw asunder from each other. The proprietary interest of the voters of the several states in the national debt will be sufficient forever to ensure the prompt stamping out of life of all the politics that may dare a second experiment in disrupting the United States of America. Had we possessed a huge Union debt in 1860, and had as much of it been diffused among the mountaineers and planters of South Carolina as is now held in Rhode Island, as much in Alabama as now in Indiana, as much in Georgia as now in Minnesota, as much in Virginia as now in Connecticut, the war for slavery had never been waged. While holding the Union bonds, the South would never have made war upon the Union. No practical means could have got at those bonds and taken them out of the South, and sent them here or to Europe to be cashed, so as to have brought the fighting men of the slave states to a willingness to make war on the government on whose perpetuity the payment of the bonds depended. And for the future, there can be no better gage and pledge for the harmonious and co-operative life of the returned Southern States, and for the permanence of the restored Union, than the national diffusion of the national debt. The bond of interest is the bond of concord. We already feel its contracting pressure from Tennessee, Louisiana, Alabama, South Carolina, North Carolina, and Virginia, where the sale of the seven-thirty loan has been established."-p. 10.

We are willing not only to admit the truth of this, but also that it is a valuable truth, one worth millions of dollars. Supposing that the country were about to be dismembered to-morrow, who would not vote to pay hundreds of millions more to unite the different sections together, so that instead of dismemberment the integrity of the republic would be guaranteed for at least another generation? It is because several of the propositions of Mr. Wilkeson are of this character that we have been induced to treat even the grossest of his fallacies with much more lenity than we usually do such things. We also agree with our author that the national debt is a good basis for national banking; and that national banking is a great convenience, if not a substantial service, to the country, few will deny :

"The bonds of the United States, accepted throughout the United States as the highest security, and having a uniform value in every one of