rge. This fact which was in the public mind in 1853 when the
income-tax was temporary, is the key to the whole position. From this
point of view we must combine it with the remission of the consolidated
annuities. I have not now the means of making the calculation exactly,
but it will be found that a descending income-tax on Ireland for seven
years at 7d., then 6d., then 5d., is largely, though not completely,
balanced by that remission. It will thus be seen that the finance of
1853 is not responsible either for a permanent peace income-tax upon
Ireland, or for the present equalisation of the spirit duties. At the
same time, I do not mean to condemn those measures. I condemn utterly
the extravagance of the civil expenditure in Ireland, which, if Ireland
has been unjustly taxed, cannot for a moment be pleaded as a
compensation. I reserve my judgment whether political equality can be
made compatible with privilege in point of taxation. I admit, for my own
part, that in 1853 I never went back to the union whence the difficulty
springs, but only to the union of the exchequers in or about 1817. It is
impossible to resist the authority which has now affirmed that we owe a
pecuniary, as well as a political debt to Ireland.

FINANCIAL PROPOSAL OF 1853

_Page 473_

_Mr. Gladstone to Sir Stafford Northcote_

_Aug._ 6, 1862.--I have three main observations to make upon the
conversion scheme, two of which are confessions, and one a maxim for an
opposition to remember.

1. In the then doubtful state of foreign politics, had I been capable of
fully appreciating it at the time, I ought not to have made the
proposal.

2. Such a proposal when made by a government ought either to be resisted
outright, or allowed to pass, I do not say without protest, but without
delay. For _that_ can do nothing but mischief to a proposal depending on
public impression. The same course should be taken as is taken in the
case of loans.

3. I am sorry to say I made a more serious error, as regards the South
Sea Stocks, than the original proposal. In the summer, I think, of 1853,
and a good while before harvest the company proposed to me to take Mr.
Goulburn's 3 per cents. to an equal amount in lieu of their own. They
were at the time more valuable and I refused; but it would have been
wise to accept, not because the event proved it so, but because the
state of things at the time was