TRANSACTIONS OF SECTION h\ 



609 



ances. A deficit of 125,000,000/. would mean that taxation would have to be 

 increased to 275,000,000?., i.e. by 58 per cent., over the 173,700,000?. of the 

 1914-15 Budget. This result, it may be well to reiterate, is based on the 

 assumption that hostilities will come to an end after sixteen months of war, and 

 the 200,000,000?. or so to be lent to our Allies and the Dominions is also ignored. 

 If the War lasts beyond November — and any Chancellor of the Exchequer must 

 budget for its doing so — the burden to be faced will be still higher. 



' The following figures, which can only pretend to be very rough, contrast 

 the assumed financial result to the United Kingdom of the present War with 

 that of earlier wars : 



' The proportion at present raised out of taxation (most of it merely covering 

 current interest on War Loans) is far lower than in previous wars, but this is 

 jjerhaps not a fair way of looking at the matter, as the amount it is possible to 

 raise out of revenue must be proportioned, not to the cost of the War so much 

 as to national income. The last line in the foregoing table is therefore the one 

 of most significance. Obviously, we should be able to pay in taxes a higher 

 proportion in respect of present income of 2,250,000,000?. per annum (49?. a 

 head) than could our forefathers in respect of their income of a hundred and 

 twenty and a hundred years ago of 250,000,000?. to 350,000,000?. per annum 

 (17?. or 18?. a head). 



' It is not feasible to fix a definite proportion between the amount which 

 should be borrowed for the War and the amount which should be raised by 

 taxation, and it is probably more a matter of first incurring debt and then 

 paying it off rapidly than of meeting a substantial portion of the cost of the 

 War otherwise than by loan. The extra revenue now being raised (61,800,(J00?. 

 per annum) is insufficient even to meet the estimated increased cost in future 

 of the National Debt plus pensions and allowances (68,500,000?. per annum), 

 and thus in effect we are momentarily raising nothing to meet the direct cost of the 

 War. Though we cannot hope, unless the War lasts an appreciable time longer 

 to meet any great proportion of the cost of the War while it continues, that is no 



'^ Professor Bastable docs not accept these figures for the Napoleonic Wars 

 see p. 612. 



1915. R R 



