minor taxes, and by one or two ingenious expedients of
collection and account, and the other two millions he made good out of the
lapsed annuities. Tea and sugar he left as they were, and the income-tax
he raised from ninepence to tenpence. Severe economists, not quite
unjustly, called these small charges a blot on his escutcheon. Time soon
wiped it off, for in fact they were a failure.

The removal of the excise duty upon paper proved to be the chief
stumbling-block, and ultimately it raised more excitement than any other
portion of the scheme. The fiscal project became by and by associated with
a constitutional struggle between Lords and Commons. In the Commons the
majority in favour of abolishing the duty sank from fifty-three to nine;
troubles with China caused a demand for new expenditure; the yield from
the paper duty was wanted; and the Lords finding in all this a plausible
starting-point for a stroke of party business, or for the assertion of the
principle that to reject a repealing money bill was not the same thing as
to meddle with a bill putting on a tax, threw it out. Then when the Lords
had rejected the bill, many who had been entirely cool about taking off
the 'taxes upon knowledge'--for this unfavourable name was given to the
paper duty by its foes--rose to exasperation at the thought of the peers
meddling with votes of money. All this we shall see as we proceed.

This was the broad outline of an operation that completed the great
process of reducing articles liable to customs duties from 1052, as they
stood in 1842 when Peel opened the attack upon them; from 466 as Mr.
Gladstone found them in 1853; and from 419 as he found them now, down to
48, at which he now left them.(17) Simplification had little further to
go. "Why did you not wait," he was asked, "till the surplus came, which
notwithstanding all drawbacks you got in 1863, and then operate in a quiet
way, without disturbing anybody?"(18) His answer was that the surplus
would not have come at all, because it was created by his legislation.
"The principle adopted," he said, "was this. We are now (1860) on a high
table-land of expenditure. This being so, it is not as if we were merely
meeting an occasional and momentary charge. We must consider how best to
keep ourselves going during a _period_ of high charge. In order to do
that, we will aggravate a momentary deficiency that we may thereby make a
_great and permanent addition to productive power_." Th