date

28 Aug. 1801 E Polit. Economy
28 Aug. 1801

E

Polit. Economy

Method

Finance

5

92

Borrowing money to defray War expenses (operations or preparations) takes from

pecuniary capital thence from real capital thence from growing wealth in the

amount of the sum so raised:- minus the amount of mercantile profit upon such

part of the expence as consists of purchased articles.

Repaying money formerly borrowed for war or other expences adds to pecuniary

capital - thence to real capital - thence to growing wealth to the amount of the

money so discharged /employ'd in such repayment or discharge/ - deducting such

part, if any, as is exported without return to foreign countries; which is the

case with such part as is exported by the proprietor to be employ'd abroad by

him or on his account, without being re-imported that or the profit made by it.

By the mere discharge of a million worth of debt as much or more is therefore

done towards the encrease of wealth as by a million given in the way of bounties

for the encouragement of this or that particular branch of trade.

Those who in the one case receive the amount of the debts respectively due to

them, give up the future interest, and the rest of the community is exonerated

from the payment of it: those who in the other case receive the million in the

score of Bounty, give up nothing in return for it.
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    As to the other opinion - the ground of it is - that if the money taken in taxes

    to be applied in discharge of the debt, had not been so taken but had been left

    in the pockets of those to whom it belonged, it would have been spent by them,

    each in his own way, and by that expenditure an addition would have been made to

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    something not to say sufficient that in one case it is only the /a/ part that is

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    Chapter 6.

    Operation of the Sinking Fund in the Production of Wealth

    The establishment of an effective and undivestible Sinking Fund has been

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    any indications I have met with) had not presented themselves to those by whom

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