had good reason for avoiding high taxation. It began
in the midst of a financial crisis. The harvest of 1792 was seriously
defective, and there was much want. The rapid advance in agriculture,
commerce, and manufactures had led to the foundation of many country
banks, which eagerly pushed their own notes into circulation, and credit
was unduly strained. Currency became redundant, and a violent revulsion
began in November, 1792, when the number of bankruptcies in the month
amounted to 105, more than double the average number of the ten earlier
months of the year. The crisis became more acute in the spring of 1793,
and during the year there were 1,926 failures, of which twenty-six were
failures of country banks. In order to relieve the distress Pitt, in
April, obtained the assent of parliament for the issue of exchequer
bills to the extent of L5,000,000 to be applied in advances at fair
interest and on good security. Fox offered a factious opposition to this
measure, alleging that it conferred a dangerous power on the executive.
It was completely successful, and the panic was checked. As, then, Pitt
believed that the war would be short, and as it was not a time for
attempting to raise taxation to an amount sufficient to furnish the
supplies within the year, he was justified in having an early recourse
to loans.

In return for the L336,000,000 of debt created by Pitt in nine years,
the country only received about L223,000,000 in money; and he has been
accused of extravagance because he raised money mainly in 3 per cent.
stock instead of at a rate more nearly corresponding to its market
value. In 1793 every L100 borrowed created L138 stock, and when in 1797
the 3 per cents. fell to 47, the sacrifice was enormous. Pitt did
attempt to raise a loan at a higher rate in 1793, and found it
impossible; and it is at least doubtful whether he did not act more
prudently in borrowing in the 3 per cents. than at a high rate.[242] In
his budget speech of 1793 he announced that he would always maintain the
sinking fund. He kept his promise, and this expensive economy provided a
deduction of L42,500,000 from the L336,000,000 of debt. Financially, as
we have seen, this was a mistake; politically it was useful in
encouraging and comforting the country in a time of stress; for the
opposition was as fully persuaded as the ministry of the efficacy of the
fund. If, then, it be allowed that the war was just and necessary,
little fault should be