viii
CONTENTS
controlled the administrative system. The legislative method of fostering
economio life, by bounties, proved cumbrous and costly. . ’ 406
211. Parliamentary Control over Public Borrowing. The Whigs, by
organising the Bank of England, deprived the Crown of the power of
borrowing independently, and thus changed the centre of gravity in the State.
The new institution also gave facilities for commercial advance. . 410
212. The Parliament of Great Britain. The Whigs exercised their
new power over the plantations in a jealous spirit, as they were afraid
of any hostile competition with the mother country, or of any colonial
intercourse with the French, and specially jealous of the increase of
any sources of royal revenue which they could not control. The Scottish
Darien scheme awakened hostility and suspicion, and these could only be
set at rest by a legislative Union. The Dual Monarchy had worked un-
satisfactorily in Scotland, and the details of the actual scheme for Union
disarmed Scotch opposition generally ; but the economic effects were not
obviously beneficial to the Northern Kingdom at first, though the ultimate
results have been good. « . . ‘ ‘ . 413
XII. Pusric FINANCE.
918, Permanent Annuities. The organisation of the Bank superseded
the practice of borrowing in anticipation of particular branches of revenue;
the granting of permanent annuities gave the Government command of
large sums on easy terms, but in accordance with the Whig principle of
parliamentary control. The financial expedient proved convenient, though
there was a real danger of imposing & burden on posterity, without
compensatory benefits, and of increasing the charges on revenue; so that
Walpole endeavoured to pay off the principal by means of a Sinking
Fund. . . . . . 7 . . ” . . 419
214. Possible Sources of Revenue. The fiscal system of the country
had been reconstituted during the Interregnum; and proposals were now
made to render it more equable and fruitful, by developing the excise, though
this was objected to both on economic and political grounds. Walpole’s
fiscal reforms were intended to foster industry and eommerce, 80 that he
might be able to dispense with the land tax; but the agitation they roused
rendered his schemes impracticable. ‘ . - . o 424
XIII. CuRrRENCY AND CREDIT.
215. The Recoinage of 1695. The deficiency of standard coin, which
necessitated the recoinage of 1696, was not due to debagement of the
igenes. The results of allowing the unrestricted export of bullion, and
the practice of free coining of hammered money, afforded profitable oppor-
tunities for clipping and sweating the coin, so as to cause great incon-
venience, and to bring about a rise of prices as calculated in silver.
Lowndes’ scheme for amending the coin, with the least disturbance to
prices, was ingenious, but inconvenient, and the old denominations were
retained in the recoinage which was carried through by Sir Isaac Newton,
who also attempted to settle the difficulty about the rating of gold. 431
216. Paper-money. The necessary conditions for the introduction
of a convertible paper currency were provided by the Bank of England,
