THE SPANISH DEBT.

HC Deb 06 July 1847 vol 93 cc1285-307

LORD G. BENTINCK

In asking the indulgence of the House while I bring before them the claims of the Spanish bondholders, I promise that I shall not detain them one moment beyond what is absolutely necessary for the fair statement of the case. It will be in the recollection of the House that a short time ago I presented a petition, signed by the chairman and the deputy chairman of the British holders of Spanish bonds, in which they prayed for redress against the Spanish Government, and for the assistance of the House to recover their just debts; that these petitioners stated that whilst the debt of Spain amounted to 78,000,000l. sterling, interest on only 7,105,066l. had been paid, leaving a balance of 70,894,934l., upon which no interest whatever had been paid. Now I am well aware that there are other creditors besides the subjects of Great Britain who are holders of Spanish bonds; but I believe there is no doubt, and I may say with confidence, that the British shareholders hold an amount equal to 46,000,000l., and it is for the recovery of that sum, on behalf of British subjects, that I now present their plea to this House. It will be my duty to show, in the first instance, that these creditors have justice on their side; and having proved that their debts are just, it will be my duty to show that these creditors, in seeking reparation, arc justly entitled to the interposition of the British Government. I think I shall have no difficulty in showing that by the laws of nations from time immemorial it has been held that the recovery of just debts is a lawful cause of war, if the country from which payment is due refuses to listen to the claims of the country to whom the money is owing. I think I shall be able to show not only that this opinion has ever been held by all the greatest jurists on the law of nations; but will also be enabled to show that such has been the practice of different nations of the earth, and also that it has been practised in various instances by this country, from the time of George II. up to the Peace of Paris, and in later times, in 1839 and 1840, as regarded the claims of this country upon Portugal, and upon several of the South American States. But it will not be sufficient that I should show the House that the claims of British subjects on the Government of Spain are not only just—it will not be sufficient that I should show that by the law of nations they arc entitled to enforce the payment of the debt and to call upon the Government to do so—but I must show that it would be prudent in the Government to make the demand, and that Spain is in a condition, if she be willing, to pay her debt. It is alleged by the petitioners that Spain is perfectly able to discharge her debt if she were willing. It was shown by those petioners that whilst a short time ago, that is to say in 1834, the whole revenue amounted to 5,990,000l., that in 1846 the revenue amounted to 12,266,353l.; so that the revenue of Spain within the last twelve years has nearly doubled itself, whilst her Finance Minister has shown an excess of income over expenditure of 450,000l., exclusive of a sinking fund of 991,123l. Now, considering that the debt to foreign creditors is one which is not disputed by Spain, for her Cortes has never assembled without making an acknowledgment of the debt, and a similar acknowledgment has been made by the Finance Minister on the part of the Government, that not only has Spain the means of paying her creditors, but she has actually paid in the most liberal manner all the debts due to her own subjects, though the obligations were contracted long subsequent to the debts due from Spain to British subjects. But exclusively of the excess of revenue I have referred to, I am prepared to show that the expenditure of Spain is conducted upon the most extravagant and profligate scale; and I think, after the case is stated, no Gentleman in this House will be inclined to deny that if ever there was a case in which one country was entitled to call upon another either to pay the debts or to he subjected to measures calculated to compel payment, it is the case of Spain. The population of Spain and her colonies amounts to 15,000,000l., and her gross revenue to 12,266,000l. Her population counts 400 individuals to each square mile, whilst Prussia, with the same number of inhabitants, counts 700 to a square mile; yet the government of Prussia is carried on, with an army the largest of any in Europe, with the exception of that of France—the government of Prussia, I say, is carried on at an expense of 8,600,000l.; nay, more, the sum of 1,300,000l. and upwards is laid aside for the payment of her debt. Spain, with her large revenue, is only paying at this time 200,000l. of interest on her debt—a sum equal only to about 3d. a head on her population. If the finances of Spain were conducted with the same frugality that the finances of Prussia are conducted, there would he a surplus of 3,226,000l. left, which would do more than defray the whole interest of the entire debt. But in what manner are the revenues of Spain wasted? Why, I find that the royal household, one of the most corrupt and profligate in Europe, costs 435,000l. a year, being upwards of 140,000l. a year more than the Queen of England receives. The like extravagance characterizes all the other sources of expenditure. The expense of the Finance department is 3,527,751l., the Minister of Grace and Justice 187,882l., the Foreign Minister 102,132l., the Home Department 1,226,104l., the Ministry of War 3,223,340l., the Legislative body 11,423l., the Ministry of Marine 884,226l., the Clergy 1,254,954l.,; and so on with the others. And here it will be in the recollection of the House, that whilst Spain refuses to pay the interest of her just debt, we have learned from the blue book so lately before us, that Spain has been able to advance 60,000l. as a loan to the Court of Portugal; and, to show how wanton she is in her wealth, she has spared an army of 15,000 men to interpose in the internal affairs of that country; so that if there be any country which could have a claim to mercy it is assuredly not Spain. Had she been in a pauperised state, like Portugal—had she been in a bankrupt state, then as it is preposterous to sue a bankrupt, so it would be imprudent to take means to compel the payment of a debt by a bankrupt State. But since I have shown that Spain has not only an ample income, but that, after paying all her extravagant expenditure, there remains 420,000l. of surplus, and 991,000l. of sinking fund, there remains nothing of any sort to justify Spain in withholding payment of her debt. The expenditure of Spain amounts on the whole to 11,483,771l., and with the 422,581l. of excess of revenue, makes her entire income 12,266,000l. Now, it has been laid down by all the jurists that among the legal causes of war is that of the refusal by one State to pay the just claims of another. Grotius, in Book III., c. 1, states the following causes of lawful war:— By the law of nature I have a right to take from any one what he has of mine, and if this cannot be easily effected, I may take what is equivalent to it; and this I may do for the recovery of a debt. And in those cases I become proprietor of what I have taken, because there is no other way of redressing the inequality that was to my disadvantage. But as often as one thing is to he taken for another, or the goods of a debtor to be seized for a debt, a demand is requisite; much more when the goods of subjects are to be seized for the debt of the Prince, whereby it may appear we hare no other way to recover our own or our debt but by war. So a Sovereign ought not to he attacked either for the debts or offences of his subjects, till satisfaction has been demanded, the denial of which puts him in the wrong. And Vattel says, in Book III., c. 3, that the objects of lawful war are— 1. To recover what belongs or is duo to us. 2. To provide for our future safety by punishing the aggressor or offender. 3. To defend ourselves or to protect ourselves from injury by repelling unjust violence. I have shown that there is no dispute about the debt. It has been acknowledged by the Cortes, by each Finance Minister, and by each succeeding Government. The right of seeking reprisals or of waging war, has been held and acted upon for the recovery of just debts long before the days of Grotius or Vattel. The Romans practised a part of the form used against the enemy. It was said by the Roman herald when declaring war, "That they neither gave, paid, nor did what they ought to have given, paid, and done." And Seneca declares, "It is a very equitable saying, and founded on the law of nations, 'Pay what you owe.'" It is for the reasons I have urged that I call upon Her Majesty's Ministers to insist upon Spain paying her debt; and I rejoice to see my noble Friend in his place, and I rejoice also that the discussion will take place in the presence of the noble Lord the Minister for Foreign Affairs. But with the view of removing a prejudice which I understand exists on the subject, I will call the attention of this House to the testimony which history gives on the question at issue; and it amounts to this, that it has been the practice of English Governments in all times past to adopt forcible means to compel other nations to make good their financial engagements. The Government of Sir Robert Walpole endeavoured to pass a Bill rendering it illegal to lend money to foreign countries without the consent of Government; but the Government of that Minister, powerful as it was, was forced to mitigate the proposition. It was alleged by the Members of the House of Commons that the trade in money was as legitimate a branch of enterprise on the part of British subjects as any other branch of merchandise; and in consequence of this opinion Sir Robert Walpole was obliged to limit the operation of his Bill to two years, and to restrict it to a particular object. And what was done in the case of the loan which was made to the Emperor? It amounted only to 80,000l., and was advanced on the security of Silesia. Silesia in course of time was transferred to Prussia, and the King refused to pay the interest; but the King of England remonstrated with him on the subject. The Duke of Newcastle, who was the Minister of that day, took the opinion of the law officers of the Crown, who reported that the King of Prussia had pledged his royal word to pay the Silesian debt, and ought to be compelled to make good his engagement. Now, let the House bear in mind that the debt was not due to the Government, but to private individuals. The Duke of Newcastle enforced the obligation to pay the debt in the following letter:—

"THE DUKE OF NEWCASTLE TO MR. MITCHELL, THE KINO OP PRUSSIA'S SECRETARY OF EMBASSY.

"Whitehall, February, 8, 1753.

"Sir—I lost no time in laying before the King the memorial which you delivered to me on the 23rd November last, "with the papers that accompanied it.

"His Majesty found the contents of it so extraordinary that he would not return an answer to it, or take any resolution upon it, till he had caused both the memorial and the Exposition des Motifs, &c., which you put into my hands soon after, by way of justification of what had passed at Berlin, to be maturely considered; and till His Majesty should thereby be enabled to set the proceedings of the Courts of Admiralty here in their true light; to the end that his Prussian Majesty and the whole world might be rightly informed of the regularity of their conduct; in which they appear to have followed the only method which has ever been practised by nations, where disputes of this nature could happen; and strictly to have conformed themselves to the law of nations, universally allowed to be the only rule in such cases, when there is nothing stipulated to the contrary by particular treaties between the parties concerned.

"This examination, and the full knowledge of the facts resulting from it, will show so clearly the irregularity of the proceedings of those persons to whom this affair was referred at Berlin, that it is not doubted, from his Prussian Majesty's justice and discernment, but that he will be convinced thereof, and will revoke the detention of the sums assigned upon Silesia; the payment of which his Prussian Majesty engaged to the Empress Queen to take upon himself, and of which the reimbursement was an express article in the treaties by which the cession of that duchy was made.

"I, therefore, have the King's orders to send you the report made to his Majesty upon the papers above mentioned, by Sir George Lee, Judge of the Prerogative Court; Dr. Paul, His Majesty's Advocate General in the Courts of Civil Law; Sir Dudley Ryder and Mr. Murray, His Majesty's Attorney and Solicitor General. This report is founded on the principles of the law of nations, received and acknowledged by authorities of the greatest weight in all countries; so that His Majesty does not doubt but that it will have the effect desired.

"Sixthly—That even though reprisals might be justified by the known and general rules of the law of nations, it appears from the report, and indeed, from considerations which must occur to everybody, that sums due to the King's subjects by the Empress Queen, and assigned by her upon Silesia, of which sums his Prussian Majesty took upon himself the payment, both by the Treaty of Breslau and that of Dresden, in consideration of the cession of that country, and which, by virtue of that very cession, ought to have been fully and absolutely discharged in the year 1745, that is to say, one year before any of the facts complained of did happen, could not, either in justice or reason, or according to what is the constant practice between all the most respectable Powers, be seized or stopt by way of reprisals.

"It is material to observe upon this subject, that this debt on Silesia was contracted by the late Emperor Charles VI., who engaged not only to fulfil the conditions expressed in the contract, but even to give the creditors such further security as they might afterwards reasonably ask. This condition has been very ill performed by a transfer of the debt, which has put in the power of a third person to seize and confiscate it.

"You will not be surprised, Sir, that in an affair which has so greatly alarmed the whole nation, who are entitled to that protection which His Majesty cannot dispense with himself from granting, the King has taken time to have things examined to the bottom, and that His Majesty finds himself obliged by the facts to adhere to the justice and legality of what has been done in his courts, and not to admit the irregular proceedings which have been carried on elsewhere.

"The King is fully persuaded that what has passed at Berlin has been occasioned singly by the ill-grounded informations which His Prussian Majesty has received of these affairs; and does not at all doubt but that when His Prussian Majesty shall see them in their true light, his natural disposition to justice and equity will induce him immediately to rectify the steps which have been occasioned by those informations, and to complete the payment of the debt, charged on the duchy of Silesia, according to his engagements for that purpose.—I am, &c. &c.

"HOLLES NEWCASTLE."

The King of Prussia listened to the remonstrance, and the debt was paid. But Prussia observed the same rule in regard to other nations as the King of England had adopted towards her. I might enumerate the demand which was made by Frederick William on this very same country of Spain, and many other instances where debts were enforced under pain of compulsory moans; but I will not weary the House with them; allow me, however, to remind the House of the case of this country as regarded France. It is known to all who hear mo that the property of British creditors in the Funds of France were, during the reign of Napoleon, forfeited; but in the Treaty of Paris, the greatest pains were taken to secure the payment of the debts thus forfeited. If the treaty itself be referred to, it will be found that by the 18th, 19th, and 20th Articles, the British Government made it a part of the conditions of peace that a commission should be forthwith appointed, and that all British subjects who held stock in the French funds should be paid up with interest thereon. Therefore there is no pretence for saying that this country was not in the practice of interfering in such matters; for we see that since the period of 1830, down to the Peace of Paris in 1814, we have uniformly maintained the right to enforce the payment of just debts due to British subjects. It has been alleged by some parties, that the Spanish bondholders had put themselves out of court because they had lent their money with their eyes open, at a rate of interest sufficient, as they thought, to cover all the risks. This, however, is not the case; for it can be shown that the larger portion of the debt was contracted for at the rate of 65l. for every 100l. of stock; whilst the debt contracted by England from 1803 to 1814 was at the rate of 60⅜l. for every 100l. of Three per Cent Consols. Therefore, so far as the price is concerned, there is nothing to show that there was any apprehension on the part of the lenders that they were running the risk of having their rights neglected by the Government who received their money. But I come now to a later period—to the claims of the British Legion, and of the British auxiliary force in Portugal, the Duke of Wellington, and others. In these cases, the matter was taken up by my noble Friend in a manner which became a Minister of this country. In the case of the Legion, the debt was contracted by a Government not then in office; but the debt was assumed by their successors. But as regarded the auxiliary force, and the claims of the Duke of Wellington and other most gallant officers, what was the language made use of by my noble Friend? Why, he demanded payment of the principal and of all the interest; and when hesitation was displayed, my noble Friend intimated that he would compel payment to be made. My noble Friend, for reasons which he assigned to the House on a former occasion, declined to lay the whole correspondence before the House; but since then I found an antiquated document which contains the notifications which were made to the Portuguese Government. The Times of November, 1840, contains the notifications of Lord Howard de Walden of the 4th and 17th of January; and I will read a few extracts, to show the kind of language which the noble Lord made use of:— The undersigned has therefore been instructed to propose to the Government of Her Most Faithful Majesty a convention for the settlement of these claims, a draught of which he has the honour to enclose; and to declare to the Govern- ment of Her Most Faithful Majesty, that solely in the event of the proposed convention being agreed to without delay, will Her Majesty's Government be satisfied.

"There being, therefore, no question involved in the consideration of the proposed convention which requires any length of time for decision, the undersigned is instructed to declare, that unless he is able to return the proposed convention ratified within a fortnight, Her Majesty's Government will proceed to take such steps as may appear to them to be proper for the purpose of obtaining redress, after having so repeatedly and earnestly, though in vain, claimed it from the Government of Portugal."

This energetic language had the desired effect. The Portuguese Government conceded the just claims of the parties, and paid interest as well as principal. The principal amounted to 296,407l.; the interest came to 45,348l., making a total of 341,755l. Of this sum the British Government received 160,958l. But this interference did not stop with Portugal. My noble Friend adopted the same course with respect to the South American States of Venezuela and New Grenada; and what was the language which was held in reference to the debts due by these States? Was it hold then that British subjects had lent their money at their own risk, and were not entitled to the protection of their own Government? Far from it. The language held was as follows:—

"British Legation, Caraccas,

May 1, 1840.

"Sir—I have the honour of informing you, that by the mail which reached La Guayra yesterday afternoon from England, I received a despatch from Viscount Palmerston, directing me to afford all the support in my power to the representations made by the agents in Venezuela of the British bondholders to the Venezuelan Government, and urge that Government to furnish its representative in London with such authority as may enable him to conclude a satisfactory arrangement with the bondholders.

"His Lordship adds:—'It is plain that so much of the public revenues of the States of Columbia as is equal to the interest of their debt to their creditors, does not, in fact, belong to those States, but has been virtually alienated by them, by the contract under which the loan was raised; therefore those States are defrauding the British creditors by applying to the public service of the Columbian States sums which, in fact, belong to the British creditor.

"'The interest due to the British creditors should be deducted from the gross revenues of the States, and the residue only is the real revenue those States have any right to apply to their own uses.

"'If that revenue is not sufficient for the service of the State, the State ought to levy on its own people a larger contribution; but it has no right whatever to make up a deficiency so arising by misapplying to such a purpose the interest which justly and legally belongs to the British creditor.'

"His Lordship goes on to inform me, that he has addressed a note to the above effect to Mr. Fortique, the Veneuelan Minister at the Court of London; and therefore he instructs me to repeat to the Venezuelan Minister for Foreign Affairs the hope of Her Majesty's Government that the Government of Venezuela will not, by longer perseverance in the injustice which has hitherto been committed against the British bondholders, bring on a state of things which will compel Her Majesty's Government to interfere in a more active manner to obtain redress for Her Majesty's subjects.

"I deem it my duty, therefore, in consequence of the very unexpected arrival of the mail from England, again to address you on the subject, notwithstanding that there has not been time for me to receive an official answer to my despatch to you, inclosing my representation to the President of the Republic by the bondholders' agent here on the actual state of their affairs with Venezuela.

"I beg leave most strenuously to recommend that such instructions may be sent to Mr. Fortique as will enable him to meet fully, and therefore satisfactorily, the propositions made on the part of the chairman of the committee of bondholders, and that they may be transmitted by the returning packet to England.

"I have the honour to remain, &c.

(Signed)

"ROBERT KERR PORTER."

That of Mr. Pitt Adams to New Granada is to a similar effect:—

"The undersigned, acting in conformity with instructions from his Government, reclaims from that of New Grenada that it shall continue scrupulously to collect, and faithfully to present, without touching them, all the funds destined by law for the payment of the interest on the foreign debt, which funds are undoubtedly the legal property of Her Majesty's subjects. He considers the time is now arrived when it is necessary for him to declare that the Republic of New Grenada, and all such individuals living within it, who, from whatever combination of circumstances, may be entrusted with authority, shall be responsible to the Government of Her Majesty for the legal application of all sums appropriated by the laws of the country, to the payment of the British creditor.

(Signed)

"WILLIAM PITT ADAMS."

The facts I have adduced show that the law of nations, the practice of nations, but, above all, the practice of this nation, and of the noble Lord who is at the head of the Foreign Affairs, concur in showing that it is the duty of this country to interpose her authority where prudence demands it, to obtain justice for the subjects of this country, whether their claims be for property confiscated, or for money lent by the subjects of England. And now it only remains to be asked whether the debtor is in a position to pay the debt if recourse he had to force; and also, whether circumstances render it prudent to adopt such a course? Well, bow does the matter stand? I have shown to you that, with a population not greater than that of Prussia, with an army greatly inferior, Spain spends 3,000,000l. every year more than Prussia does. I have shown to you that, in point of fact, the Queen of Spain's household squanders a good deal more than suffices for the Queen of England, whose sceptre includes 130,000,000 of people. Well, now for the prudence of risking the alternative of force as a means of compelling payment. The army, although nominally consisting of 115,000 men, is most wretchedly appointed. Besides, she possesses the rich island of Cuba, and the valuable colony of Porto Rico, which would enable her to pay the whole interest due to her creditors of this country. I find that the population of Porto Rico has risen, in 1845, to 350,000 souls, and that the number of slaves is 45,000; that its revenue has risen from 72,450l. in 1823, to 700,000l. in 1845; and that its exports (of sugar, coffee, tobacco, cocoa, and cotton) amounted, in 1834, to not less than 938,000l. In Cuba, too, the same wealth and prosperity reign. The population of Cuba consisted, in 1775, of 95,419 whites, 30,616 free mulattoes, &c., and 44,336 slaves, making a total of 170,370. But, in 1825, these numbers had more than quadrupled, for they then amounted to 311,051 whites, 106,497 free mulattoes, &c., and 286,942 slaves, in all a total population of 704,490. The public revenue of Cuba was, in 1845, 1,562,500l., which added to the revenue of Porto Rico, which, in the same year, amounted to 700,000l., would leave their joint income no less than 2,262,500l. The debt due from Spain to British holders amounts to about 46,000,000l., the interest on which, at 3½ per cent., is 1,610,000l.,; and this sum deducted from the total revenue of Cuba and Porto Rico alone, would leave a surplus income to Spain from those sources of 652,500l. The annual value of the produce of the island of Cuba is about 9,300,000l., whilst the revenue of Havannah alone increased in twelve years, viz., from 1815 to 1827, from 1,726,963 dollars to 4,383,262 dollars. Here, then, is wealth to repay the whole debt due by Spain to British bondholders. Now, as the whole Spanish navy only amounts to three ships of the line, five frigates, and twenty sloops, brigs, and smaller vessels of war, so far as the prudence of the case goes, I think the most timid Minister need not be under any apprehension that, whatever course was taken, there would be any very effective resistance on the part of Spain. I think, then, I have shown that there is capability on the part of Spain, and that it only requires the application of an energetic system on the part of the noble Lord to show her the necessity of placing herself in a position to pay her debts. Let the House look at the capability of Spain. In 1780, in the reign of Charles III., her customs' duties gradually advanced to 2,000,000l. sterling, and they have now retrograded to 500,000l. a year. Now, I have already observed that the whole contribution of the Spanish people to the payment of the foreign debt of their country amounts only to 200,000l. a year, being only about 3d. a head; and seeing what is the capability of Spain, I must be allowed to add that if ever there was a country entitled to call upon another to pay her just debts, it is unquestionably England that has a right to make such a call upon Spain—England, who has never hesitated to act up to the full amount of her obligations—whose honesty has never wavered—who pays 20s. in the pound for every thing she borrows, and has given 100l. in gold for every 60l. she has received—and who has delivered Spain from the tyranny of Napoleon. All we ask from the Spanish people is, that they shall be content to pay a sum of money equal to 3d. per head on the population of Spain. But here I cannot pass over this part of the subject without showing the way in which Spain has dealt with her home creditors, as compared with the manner in which she has treated her foreign creditors; how she has paid the interest due to the one, to the neglect and injury of the other. Spain owed many of her citizens debts arising out of contracts, &c., made during the civil war. These she has just paid in three per cent stock, taken in discharge of the debts at 40 per cent, or little more than the market price of the day; so that for 100l. due in cash, the creditors received 250l. three per cent stock. But this same Spain, a few years back, when she capitalized the arrear dividends of her foreign creditors, gave them, for 100l. due in money, but 100l. three per cent stock, the market value of which at the time was about 23l. 5s. per cent cash. "So that there never was a grosser injustice than that of which Spain has been guilty towards her foreign creditors. Sir, since I first gave notice of this Motion, I have received very many letters from unhappy victims of Spanish bad faith. I stand not up here as the advocate of the great loan-mongers of the' city; my sympathies are not with them, whether circumcised or uncircumcised—but my sympathies are with the widow and the orphan—and with those veterans of the British service, who having fought for Spain, have invested the earnings of their lives in the funds of that country. I stand here as the advocate of what I believe to be the weakest, the most neglected, and the most helpless of the people of this country. I have not been visited, or applied to by the Aguados, the Ricardos, or the Rothschilds; and, even if they are losers, I should not much sympathize with them; but I fear it is the humblest and the weakest class in this country that have been the worst sufferers by the bad faith of Spain. My sympathies are arrayed with that class; one of whose letters—for it is short, and far more impressive and affecting than anything I can say—I will take the liberty, before I sit down, of reading to this House, the Members of which, I cannot but feel, will, when they shall hear it, look upon the letter as rather addressed to themselves than to me. It is, Sir, a letter from one of that class which ever must have the sympathy of this House, an old half-pay commander of thirty years' standing. The noble Lord, then, with much feeling, read the following letter:— My Lord—Although, God knows, I have little more to lose, I cannot resist thanking your Lordship for advocating, in the House of Commons, the claims of the hapless Spanish bond-holders. My story is soon told. It is a short one, but it is that of hundreds, I am informed. Five thousand pounds, the whole saving of a professional life, won during thirty years of hard service in every quarter of the globe, was in a fatal hour, in 1836, invested in Spanish bonds, the interest of which has been stopped for upwards of Seven years. My wants, and having a family of eight to he kept and educated on my half-pay, has compelled me, time after time, to sell, or rather give away, the whole, so that, however the matter goes, I have nothing to gain; yet, for the sake of a brother officer, who has a large family like myself, and who still holds his stock, I shall rejoice if your Lordship should be successful in forcing the Spanish thieves to pay; although, when I look on my own portionless children, my joy will be turned into sorrow. I often wish I had fallen in one of those fierce encounters it has been my lot to live through. Many a Spanish life have I saved, and this is my reward! I dare not think of it—for a frenzy seizes me—and I long to he again on the quarter-deck with a Spaniard alongside; but my arm is too old and powerless now—there is nothing sound left but the heart and that goes with your Lordship in this kind, humane, and generous undertaking, though I fear your Lordship will find that the words of these Spaniards are as worthless as their bonds.—I am, my Lord, your humble servant, A COMMANDER OF THIRTY YEARS' STANDING. Sir, my appeal to this House to-night is, that it will exercise that duty which becomes every civilized State—the duty of protecting the interests of its humblest subjects; and, in conclusion, I call upon it to make these words good, and Spanish bonds of more worth, in spite of the dishonesty of the Spanish nation. The noble Lord concluded by moving— That an humble Address be presented to Her Majesty, praying Her Majesty to take such steps as Her Majesty may be graciously pleased to deem advisable to secure for the British holders of unpaid Spanish Bonds redress from the Government of Spain.

VISCOUNT PALMERSTON

Sir, I am not going to state any material difference of principle from the opinions which have been expressed by my noble Friend, although I certainly differ from him in the application—as to the degree in which he proposes to the House to enforce his principles; and, if they were to be enforced, I should differ from him as to the limited application of them which he contemplates. My noble Friend has quoted passages from the law of nations, laying down the doctrine that one Government is entitled to enforce from the Government of another country redress for all wrongs done to the subjects of the Government making the application for such redress, and that, if redress be denied, it may be justly obtained by reprisals from the nation so refusing. I fully admit to this extent the principle which my noble Friend has laid down. At the same time, I am sure the House will sec that there may be a difference and distinction drawn in point of expediency and in point of established practice, as to the application of an indisputable principle to particular and different cases. Now, Sir, if the Government of Spain had, we will say for example, violently seized the property of British subjects, this country being on terms of amity with Spain under treaties, no man will for a moment hesitate in declaring that it would be the duty of the Government of Great Britain to enforce redress. In the same manner, in any transaction that is founded on previous compacts between two Governments, in any transaction that is founded on the previous sanction of the Government whose subject is the complainer—in any case of that sort it has been the practice of Great Britain to demand and insist upon redress. Again, if any act of injustice in the prosecution of trade and commerce he inflicted on British subjects, there can he no question as to the course which the Government of this country ought to pursue. But there has always been drawn a distinction between the ordinary transactions of British subjects with the subjects of other countries, and the transactions of British subjects with the Governments of other countries. When a British subject engaged in trade with the subjects of a foreign country sustains a loss, his first application is to the laws of that country for redress. If those laws are not properly administered in his case, then the British Government steps in and demands either that the law shall be properly dealt out, or that redress shall be given by the Government of that State. It is to the advantage of this country to encourage commercial dealings with foreign countries; but I do not know that it is to the advantage of this country to give great encouragement to British subjects to invest their capital in loans to foreign countries. I think it is inexpedient, for many reasons, that that course should be pursued. It exposes British subjects to loss from trusting Governments that are not trustworthy; and if the principle were to be established as a guide for the practice of British subjects, that the payment of such loans should be enforced by the arms of England, it would place the British nation in the situation of being always liable to be involved in serious disputes with foreign Governments upon matters with regard to which the British Government of the day might have had no opportunity of being consulted, or of giving an opinion one way or the other. If British subjects came to the Government of this country and said, "We are disposed to deal with a foreign State, will you compel that State to make good its engagements, should it fail in doing so?" Then, if the British Government were to say in reply, "We will give the undertaking you require;" and if afterwards the foreign State should fail to fulfil its engagements, there could be, undoubtedly, no question as to the course which the British Government should take. That question has been more than once put to the Government of which I am a Member, and my reply always was—"If you choose to advance your money, you do it at your own risk; but you are not to expect, if the Government to whom you lend your money fail in its engagements, that England, as a country, will interpose to obtain for you redress. I am bound to say that the prudence of the parties who put the question to me has been on all occasions such that no contract has followed the answer that I have given. Still, Sir, I do not deny the doctrine of the noble Lord, setting aside the question of expediency, putting out of view the question whether it is politic or not for the British Government to undertake such an obligation. My opinion is, that it is not wise so to do; but I am not disposed to question the doctrine, that as a matter of strict right the English Government would be justified in demanding of any foreign Government to make good its engagement with a British subject, whatever that might be, and that failing to obtain redress, it would be entitled to take the steps that my noble Friend points out to enforce such redress. I cannot, however, think that it would be expedient in the present state of the transaction to impose on Her Majesty's Government the duty which my noble Friend wishes us to undertake. I am, however, quite sensible of the great importance of this question to a vast mass of Her Majesty's subjects. Those debts are owing to them to an enormous amount. They have been contracted, as my noble Friend states, not merely with a few great capitalists, whose losses I should not, however, see with the same complacency and indifference with which my noble Friend says he should view them—perhaps the smallness of their number might make my noble Friend look upon them with more philosophic calmness than I could—but with an immense number, a vast number of persons of most limited and contracted means—men who, as he states, have invested the small savings of an industrious life, or the small remains perhaps of dilapidated fortunes, some no doubt as a speculation, being tempted by the high rate of interest promised them, but a great number really acting from generous impulses resulting from having seen those countries struggling in difficulties, or engaged in conflicts for that liberty which we enjoy. I am persuaded that besides the inducement of high interest, there have been generous and good feelings operating upon a great number of the persons who have advanced their money in these loans. And, Sir, that undoubtedly adds to the baseness of the Governments who have broken their engagements, and never fulfilled their pledges. I cannot, Sir, retract that expression, because there is hardly one Government indebted in this manner to British subjects, which might not have paid, if not the whole, at least some portion of the interest upon the debts which they have contracted. They go on squandering their resources, and allowing their revenues to be plundered and pillaged in the collection, even allowing the members of the Administration to amass fortunes for themselves by the misapplication of the public funds. One half of their revenues which is collected is misapplied on its way to the treasury; and the greater part of the other half goes to illegitimate purposes, unconnected with the interests of the country; and then they come, in the form of paupers, and tell us they are unable to meet their engagements. The South American States, or some of them, may for a time have been really unable to meet their engagements; and I believe that Spain during a portion of the civil war was in difficulties which justified her demands for forbearance. Spain, however, is no longer in that condition. The public income of Spain has been nearly doubled in the last ten years: but why is it not larger? Because Spain chooses to persevere in a system of commercial restriction and exclusion, by means of which she herself positively makes her revenue inadequate to meet her engagements. Because Spain, at this day, in spite of all the experience and the example of other countries—in spite of all the lessons which have been read to her—in spite of all the discussions and debates which have taken place all over the world—goes on shutting her eyes to facts and her ears to reason. Because Spain, in spite of all these lessons, goes on excluding and prohibiting a great portion of the commerce which would otherwise naturally flow into her ports. I believe I am not at all exaggerating the fact—for I have heard it within a very short period from a person well acquainted with what he spoke about—when I say that there are in Spain 130,000 persons professionally employed in smuggling. This is a monstrous thing; but I cannot disbelieve the fact, from the way in which it was stated to mo. There are also about 12,000 or 15,000, perhaps 20,000 men! employed professedly in watching the smugglers. Thus there are about 150,000 of the population of Spain employed, one way or other, in contraband trade. Hero, then, is a great portion of their own active people, the best of the population, who, if employed in productive industry, would be most valuable instruments in adding to the public wealth. They are, however, employed in that legitimate branch of commerce which is assigned to the province of distribution. They are the distributors of commerce; and then, Sir, when the Spanish Government is urged to abolish these prohibitions, and permit the commodities which are so smuggled to come in, they say, "We are unable to do it, because we must give protection to native industry!" But this native industry which they protect is really nothing but the industry which I have been describing; because, as to Spanish manufactures, the simple fact is this, that a great part of the manufactures which are so smuggled into Spain—a great part of the cottons and the silks which are said to be produced by the industrious artisans of Catalonia and other provinces—are introduced by three or four houses in Barcelona, great smugglers—capitalist smugglers—who regularly receive from Manchester and from Lyons cottons and silks of good English and French manufacture, irregularly stamped with Spanish marks, which are afterwards thus distributed as the produce of Spanish industry. Spain, therefore, loses all the revenue which she might derive from levying moderate and proper duties upon the commodities now so smuggled in; and no industry of any sort or kind is protected or encouraged, except industry in smuggling, which tends to demoralise the population, and engender habits of contempt for the law—which makes the man who engages in smuggling to-day, to become a robber to-morrow—which loads one day to-the carrying of contraband goods into the mountains, and the next to carry off the unoffending passenger into the same mountains in order to divest him of his property. This is the state of Spain, and these are the principles of her commerce by which she voluntarily sacrifices a largo annual income—an income more than sufficient to satisfy all her foreign creditors, if it were received—for no other earthly objects than those I have just described. I am afraid, however, that the endeavours which the British Government has from time to time made to persuade the successive Governments of Spain to alter this most foolish and absurd system, have in no small degree been counteracted by influences coming from other parts of the world. I am bound to say that I believe the successive Governments of Franco have from time to time opposed obstacles to any plan for liberalizing the commercial system of Spain. A most unfounded jealousy has produced those obstacles. The changes which we desire would be just as advantageous to France as they would be to England; in point of fact, I really do not believe that the commerce of England would gain much by any change, because trade will find its way; where a demand is, there will be found a supply. And if Bonaparte, in the plenitude of his military power, was not enabled by the Milan and Berlin decrees to prevent the introduction of British commodities into the Continent, it is not to be supposed that a Government like Spain, so weak in its centre of action, and so perfectly impotent in its circumference, can be expected to carry the excluding decrees of its existing law into full and complete execution. But, Sir, I should hope that the Spanish Government would be induced, by a regard for its own interest, to sweep away these absurd prohibitions, and thus place itself in the receipt of an increased revenue, which would enable it, without any difficulty whatever, to pay off the foreign debt (if there be any difficulty now, which I do not believe), and do justice to the claims of its British creditors. I confine not what I say to the Government of Spain; because though the Motion of my noble Friend is limited in its application to the debts due by that country, in principle it applies to the other debts—and they are multitudinous—which are due from other States. From the statements which my noble Friend has read, it appears that in point of fact these debtor States are applying to their own use, and calling it the public service—but which I should say was a misapplication and malversation incident to their organization—that which is not their property to be so applied. There can he no doubt that the interest of these debts no longer belongs to them. They are only receivers in trust for the foreign creditor, and they have no right to apply one farthing of that amount to any service of their own, however urgent that service may be. They ought to pay the interest upon their debts first, and then see what remains; and if that is not sufficient, they must lay on fresh taxes, to provide what their public service requires. I think that is a doctrine indisputably true, and I should hope that the discussions in this House, and the opinions proclaimed in public, would bring those Governments, in proportion as they become more settled, to see that not only their honour, but even their interest, requires them to make good their solemn obligations. It must be admitted that many of the South American States have been in a state of internal confusion, which has afforded some excuses for their neglect of an indisputable obligation. I remember talking one day with a very intelligent citizen of one of the States in the North American Union, who made an observation which I believe to be as perfectly true as it is undoubtedly striking. "The difference," he said, "between us who belong to the United States, and the South American States, is just this—they settle all their disputes by the cartridge-box, whilst we settle ours by the ballot-box. We," he added, "think the latter is an infinitely less troublesome and more convenient method of adjusting our various differences, because it leaves us at liberty to mind our domestic affairs." I am happy to say that I believe the South American States are beginning to leave off the cartridge-box. Some of them have set a very good example to the others, by paying what is due from them, and I hope the rest will soon follow it. And if a good example is set by those who hitherto have been in the habit of dealing with the cartridge-box, I should hope it would not be lost upon those who deal with, the ballot-box. But the northern American States, who really are able to pay, and who have no excuse whatever for not paying—who have no internal revolution, no military dictator, no civil war to justify their breach of faith—I should hope would not wait for the example of their southern brethren, but would themselves wipe from their history that blot which must be considered a stain upon their national character. I do not differ from my noble Friend, as far as this goes; and if it were the policy of England—the wise policy of England—to lay down a rule that she would enforce obligations of a different kind, I think we should have a fair and full right, according to the laws of nations, to do so. My noble Friend instanced the cases in which compensation had been made to British subjects at the Peace of 1814 for property which had been confiscated during the war, and the cases in which Her Majesty's Government had required from the Government of Portugal payment of the sums due to the Duke of Wellington, Marshal Beresford, and a certain number of other creditors; but I think it right to state there is a wide distinction between those cases and the cases which are the subject of the present discussion. My noble Friend will find that Lord Castlereagh, in announcing the conditions of the Treaty of 1814, distinctly made it known that compensation had been exacted, because by a prior treaty the French Government had not been at liberty to make the confiscation. On that account compensation was exacted; but Lord Castlereagh warned the public that if in future, without the previous sanction of the Government, they invested their money in the French funds, and confiscation followed, they must not look for similar interposition on the part of the British Government. In the case of the Duke of Wellington and Marshal Beresford, there had been the previous sanction of the British Government. The employment of those officers by the Government of Portugal was in pursuance of a previous consent given by the Government of England; it was an engagement contracted between the Governments of Portugal and England. There were, therefore, special reasons why the British Government was entitled to call upon the Government of Portugal to make good its engagements. In saying this, however, I do not mean in any way to qualify or do away with the assent I have given to the general principles advanced by my noble Friend. Although I entreat the House, upon grounds of public policy, not to impose at present upon Her Majesty's Government the obligations which the proposed Address would throw upon them, yet I would take this opportunity of warning foreign Governments who are the debtors to British subjects, that the time may come when this House will no longer sit patient under the wrongs and injustice inflicted upon the subjects of this country. I would warn them that the time may come when the British nation will not see with tranquillity the sum of 150 millions due to British subjects, and the interest, not paid. And I would warn them that if they do not make proper efforts adequately to fulfil their engagements, the Government of this country, whatever men may be in office, may be compelled by the force of public opinion, and by the votes of Parliament, to depart from that which hitherto has been the established practice of England, and to insist upon the payment of debts due to British subjects. That we have the means of enforcing the rights of British subjects, I am not prepared to dispute. It is not because we are afraid of these States, or all of them put together, that we have refrained from taking the steps to which my noble Friend would urge us. England, I trust, will always have the means of obtaining justice for its subjects from any country upon the face of the earth. But this is a question of expediency, and not a question of power; therefore let no foreign country who has done wrong to British subjects deceive itself by a false impression either that the British nation or the British Parliament will for ever remain patient under the wrong; or that, if called upon to enforce the rights of the people of England, the Government of England will not have ample power and means at its command to obtain justice for them.

MR. HUME

had heard with great gratification the able speech of the noble Lord. He rose, however, to ask the noble Lord opposite (Lord G. Bentinck) who had introduced the question, to adopt in good earnest the lesson in free trade which the noble Viscount had just read to him. The Protectionists had too long been following the unwise course taken by Spain, and by that means done all in their power to check the industry of England. He asked, however, no more from the noble Lord than to take into his consideration the prudent, wise, and proper course which had been sketched out by the noble Viscount. He approved highly of the sentiments just delivered to the House; for he had always thought that if foreign States became debtors to British subjects, those subjects had a perfect right to claim the protection of the British Government. He trusted the terms used by the noble Viscount would have their proper effect on some of the States of the North American Union who were indebted to this country. He had always taken deep interest in the United States of America. He thought he perceived in them a rising prosperity from the policy of a wise and honest Government; but he was sorry to observe, in later years, that notwithstanding all the means which they had to satisfy all their creditors, they had allowed their claims to fall into arrear. The United States had thus lost the high character which they once held; but he trusted the sentiments of the noble Lord would reach them, and that ere long their credit would be redeemed.

LORD G. BENTINCK

After the tone taken by my noble Friend, I am sure there will be nothing left to be wished for by the Spanish bondholders. In the language of my noble Friend, coupled with the course he has adopted upon former occasions as regards the payment of British subjects by Portugal and the South American States, the British holders of Spanish bonds have full security that he will in other cases exercise the same energy when the proper time-arrives to have it exercised, in the case of other subjects of the Crown. Such an intimation has been given in the tone and language of my noble Friend to the Spanish nation; and I doubt not they will set themselves to work with very little loss of time themselves to do justice to the foreign creditors of Spain.

MR. BORTHWICK

was sure the speech of the noble Lord would be more effectual than the sending of an army to enforce the rights of British subjects. Within about fourteen years the Government of Spain had received two hundred and seventy millions of money from the sale of church property; and, notwithstanding that so large a sum had gone into their possession, they had done nothing to pay off the debts which the country had incurred. Whilst the poor creditors of Spain, in England, and elsewhere, were suffering the greatest distress, the grandees of Spain and the Princesses—Christina, for one—were rolling in wealth. He said it was disgraceful that such should be the case, considering that that wealth had been taken from the pockets of the people, who had established the dynasty of her daughter on the Throne of Spain.

SIR DE LACY EVANS

said, it appeared no Spanish subject could be introduced without some little attack upon the Spanish dynasty. It was, however, certainly a consistent course for the hon. Member for Evesham to pursue, who had so long advocated the cause of the unfortunate Prince, Don Carlos. But the hon. Member must remember, though 270,000,000l. had been derived from the sale of church property in Spain, yet that the actual profit to the State had been very small. As far as the payment of the forces employed in Spain under his command was concerned, he must say that the Spanish Government had acted most honourably. They had fulfilled all their obligations, and every award of the Commission had been paid to the last farthing; moreover, the pensions to the widows, &c, continued to be paid with the same regularity as by the British Government.

Motion withdrawn.