against you upon it; so what better are you?' The lender, so far from
concurring with the sanguine hopes about the fructification of the
L.10, will only regret his having intrusted the larger sum to a person
whose notions of money are so loose and preposterous.

Yet the proposal would only have carried into private pecuniary
matters the principle of the sinking-fund, so long deemed a blessing,
and a source of future prosperity to the country. A sinking-fund is an
expression generally applied to any sum of money reserved out of
expenditure to pay debt, or meet any contingency. Now, observe that
our remarks are not directed against it in this simple form. A surplus
of revenue obtained by moderate taxation, saved through frugal
expenditure, and applied to the reduction of the national debt, is
always a good thing. But the sinking-fund to which we chiefly refer
was a system of borrowing money to pay debt. It might be said that the
identical money which was borrowed was not the same which was used for
paying the debt; but it came to the same thing if the sinking-fund was
kept up while the nation was borrowing. Thus, taking the case of the
private borrower as we have already put it, if he took L.10 of his own
money and put it out at interest, that it might increase and pay off
his loan, and if, by so doing, he found it necessary to borrow L.110,
instead of merely L.100, it was virtually the same as if he applied
L.10 of the borrowed money for his sinking-fund. Thus for the year
1808, the state required L.12,200,000 in loan above what the taxes
produced. But in the same year L.1,200,000 were applied to the
sinking-fund; consequently, it was necessary to borrow so much more,
and therefore the whole loan of that year amounted to L.13,400,000.
The loan was increased exactly in the way in which our friend added
the L.10 to the L.100. It was borrowing money to pay loans.