[00 
MONEY 
payable on long leases, preference and preferred ordi- 
nary dividends, pensions, and life annuities are 
virtually written down, the owners being cheated to 
benefit, not the Government or the country in general 
but the persons who have to pay these sums, and 
who for the most part had no desire to thus skulk 
out of their proper obligations. Under an avowed 
bankruptcy, as Adam Smith justly observes, even 
the State creditors would as a body be better off, 
since most of them hold, in addition to State 
obligations, rights to fixed sums payable by individuals 
and private institutions. 
“In most countries the creditors of the public 
are, the greater part of them, wealthy people, who 
stand more in the relation of creditors than in that 
of debtors towards the rest of their fellow-citizens. 
A pretended payment of this kind, therefore, instead 
of alleviating, aggravates in most cases the loss of the 
creditors of the public; and without any advantage 
to the public, extends the calamity to a great number 
of other innocent people. It occasions a general 
and most pernicious subversion of the fortunes of 
private people ; enriching in most cases the idle and 
profuse debtor at the expense of the industrious and 
frugal creditor, and transporting a great part of the 
national capital from the hands which were likely 
to increase and improve it, to those which are likely 
to dissipate and destroy it. When it becomes 
necessary for a state to declare itself bankrupt, in 
the same manner as when it becomes necessary for 
an individual to do so, a fair, open, and avowed 
bankruptcy is always the measure which is both 
least dishonourable to the debtor, and least hurtful 
to the creditor. The honour of a state is surely 
very poorly provided for when, in order to cover 
the disgrace of a real bankruptcy, it has recourse 
to a juggling trick of this kind, so easily seen through,