Abortive Attacks on the Ministry-Mr. Disraeli's First Budget-Fall of the Tory Cabinet-The Queen and Lord Aberdeen-Organising the Coalition--A Ministry of "All the Talents"-The Queen and South Kensington--A Miser's Legacy to the Queen--Sport at Balmoral-Proclamation of the Second EmpireThe "Battle of the Numeral "--The Queen Initiates a Policy-Personal Government in the Victorian AgeA Servile Minister-Lord Malmesbury's Spies-Napoleon III. and "Mrs. Howard"-Creole Card-Parties at Kensington-Napoleon III. Proposes to Marry the Queen's Niece-Lord John Russell's Education Scheme -Mr. Gladstone's First Budget - The India Bill - Transportation of Convicts to Australia Stopped-The Gold Fever in Australia-The Rush to the Diggings-The First Gold Ships in the Thames-Gold Discoveries and Free Trade--Chagrin of the Protectionists-The Rise in Prices-Practical Success of Peel's Fiscal Policy-Strikes and Dear Bread--End of the Great Peace.

No sooner had the Duke of Wellington been buried than rival parties resumed the war of faction. The Free Traders, who had been resuscitating the old anti-Corn Law organisation in the North of England, resolved to force from the Ministry an unambiguous declaration against Protection. Mr. Charles Villiers accordingly moved a series of resolutions on the 23rd of November, affirming, that the Free Trade policy of the country had been wise, just, and beneficial "three odious epithets," said Mr. Disraeli, which could not be accepted by the Tory Party. He ridiculed this attempt to revive the cries of "exhausted factions and obsolete politics." He was himself fain, however, to propose a resolution, which admitted that Free Trade had cheapened the necessaries of life, which bound the Government to adhere to that policy, but which did not contain any formal recantation of Protectionist principles.† Mr. Bright hit the weak spot in these tactics when he asked, was it safest to let the national verdict on Free Trade be drawn up by Mr. Villiers, who advocated it, or by Mr. Disraeli, who did not advocate it, and the majority of whose followers were pledged to exact from the people some kind of compensation to the landed interest for the repeal of the bread tax? Had it suited Lord Palmerston to let the Ministry be beaten, nothing could have prevented their defeat. But, as we have seen, he had resolved never to serve under Lord John Russell; and there was too much reason to fear that at the moment Lord John was the only possible Premier in the event of Lord Derby resigning office. "A moderate resolution," writes Sir George Cornewall Lewis to Sir Edmund Head, "had been prepared by Graham, and assented to by Lord John and Gladstone. Charles Villiers was willing to move it, but Cobden insisted on something stronger, in the secret hope that the House would reject it, and thus damage itself in public opinion, thereby promoting the cause of Parliamentary Reform. Palmerston got possession of the resolution prepared by Graham, and moved it as an intermediate proposition." The * Hansard, Vol. CXXIII., p. 351. + Ibid., p. 411.

Letters of the Right Hon. Sir George Cornewall Lewis, Bart., to Various Persons, p. 259.

resolution affirmed the principle of Free Trade, but not in terms obtrusively offensive to the Tories. It was eagerly accepted by Mr. Disraeli, who saw in it the means of deliverance from his enemies, and it was carried by a majority of 468 to 53-the minority representing all the Tories who were prepared to cling to Protection, even after it had been formally abandoned by Mr. Disraeli in his audacious address to his constituents.*

Mr. Disraeli's tactics in thus evading defeat have sometimes been cited as a proof of his skill. In reality, they were the outcome of inexperience and exaggerated self-confidence. He did not correctly understand why Sir James

Graham and Mr. Gladstone desired to move a moderate resolution. They were, of course, anxious not to turn out the Ministry before Mr. Disraeli's Budget saw the light. They were morally certain that it would contain some fantastic proposals, which must not only wreck the popularity of the Government, but destroy public confidence for ever in Mr. Disraeli's financial skill. Events proved that they were right in their calculation.

On the 3rd of December, in a speech of dazzling brilliancy, Mr. Disraeli introduced his famous and fatal Budget. It reduced the Malt Tax by one-half. The House Duty was raised from 9d. to 1s. 6d. in the £, and extended from houses of £20 to houses of £10 rental. Light dues paid by ships other than for the support of lighthouses pure and simple were taken off. Tea duties were to be reduced gradually by small annual amounts from 2s. 2 d. to 1s. a

*T. P. O'Connor's Life of Lord Beaconsfield, p. 441; Hickman's Beaconsfield, p. 183.

1852.]

MR. DISRAELI'S FIRST BUDGET.

517

pound. The Income Tax was to be extended to funded property and salaries in Ireland. A distinction was drawn in taxing permanent and precarious incomes, the exemption for industrial incomes being limited to £100 a year, and for incomes from property to £50; and the rates of assessment per £

were 7d. on incomes from rent of land and from funds, but only 54d. on incomes from farming, trade, and salaries. Farmers' incomes were to be taken as a third instead of a half of their rents. The remissions were so balanced by the additions to taxation that no surplus on the estimated revenue could be shown. A surplus of £400,000 was, however, manufactured by appropriating as revenue the repayments on local loans made to the Exchequer Loan Commission-repayments hitherto used for clearing off debt. The scheme

could not stand criticism. After four nights' debate, it was utterly demolished, Mr. Gladstone's speech attacking it being one of the few which are said to have ever really turned doubtful votes in the House of Commons. The addition to the House Tax, pressing, as it did, on those who would come within the extended range of the Income Tax, infuriated the urban voters. The remission of half the Malt Tax failed to satisfy a landed interest, hungering for compensation for the abolition of the Corn Laws, because a reduced Malt Tax, it was agreed, benefited nobody but the publicans and the brewers. An extension of the Income Tax to funded property, Mr. Gladstone contended, was a breach of Mr. Pitt's pledge to the public creditor, in 1798, that no distinct and special tax should ever be laid on the stockholder as such. Mr. Gladstone, like all the eminent financial authorities, protested against recognising the illusory principle of a graduated Income Tax, which lurked in the distinction made between permanent and precarious incomes. He further protested against the danger of estimating too narrowly for the services of the year, and urged with incontestable force that it was a vicious principle to reckon as surplus revenue £400,000 of repayments on the score of local loans-that is to say, to regard the repayment of borrowed money as true income. The Government were beaten on their Budget, by a vote of 305 to 286, on the morning of the 17th of December.* In the evening Lord Derby handed his resignation to the Queen at Osborne.

Her Majesty, fully aware of the reasons that rendered Lord John Russell an impossible Premier, now saw her way to organising the strong Government of capable and experienced statesmen which, ever since 1846, she had held could only be formed by a coalition of the Whigs and the Peelites. She accordingly summoned Lord Aberdeen and Lord Lansdowne to assist her out of the Ministerial crisis. Gout prevented Lord Lansdowne from attending at Osborne. His ill-health, together with his loyalty to Lord John Russell, and the disinclination of the Peelites to serve under him, rendered it impossible for him to accept the Premiership. It was equally impossible for the Queen to ask Lord Palmerston to become Prime Minister, after the recent events which had led to his dismissal from the Foreign Office. Hence Lord Aberdeen, though the head of the smallest faction, was the candidate for the Premiership who least divided the Opposition. He was therefore charged with the task of forming a Cabinet.† On the 28th of December the famous Coalition

*Hansard, Vol. CXXIII., p. 1693.

It is worth while to recall this fact. After the resignation of Mr. Gladstone in 1886, when the Tory Party attempted to form a Coalition Ministry under Lord Hartington as Premier, and Lord Salisbury as Foreign Secretary, the project was defended on the plea, that just as the Whigs in 1852 bought up a small but powerful faction of Peelites, by giving their leader the Premiership, so should the Tories in 1886 buy up the small but powerful section of Liberal "Unionists" by putting Lord Hartington at the head of affairs. The argument, it will be seen, was based on a complete ignorance of party history and of the ideas and policy of the Court in 1852, because it was for other reasons altogether that Lord Aberdeen was elevated to the Premiership.

1852.1

THE WHIG AND PEELITE MINISTRY.

519

Ministry was organised-Lord Cranworth was Lord Chancellor; Lord Aberdeen, Prime Minister; Mr. Gladstone, Chancellor of the Exchequer; Lord Palmerston, Home Secretary; Lord John Russell,* Foreign Secretary; the Duke of Newcastle, Colonial Secretary; Mr. Sidney Herbert, War Secretary; Sir J. Graham, First Lord of the Admiralty; Lord Granville, President of the Council; Sir C. Wood, President of the Board of Control; the Duke of Argyle, Lord Privy Seal; Sir W. Molesworth, Chief Commissioner of Works; the Marquis of Lansdowne, a Minister without office. "The success of our excellent Aberdeen's arduous task," writes the Queen to the King of the Belgians, "and the formation of so brilliant and strong a Cabinet would, I was sure, please you. It is the realisation of the country's and our own most ardent wishes, and it deserves success, and will, I think, command support." + The Queen here simply reflected public opinion. Never had a Cabinet of abler men, individually speaking, ruled England since the Ministry of "All the Talents" fell from power. But the Sovereign and her people both forgot that in our strange and anomalous constitution no Cabinet is, as a rule, so weak as a Cabinet of strong men. This Ministry, which started on its career on the flood-tide of Court and popular favour, was destined, by its vacillation in foreign policy, to lead the country into the terrible calamity of a European war. It was doomed to fall amidst the execrations even of those who, like Mr. Cobden, declared that to his dying day he could never sufficiently regret giving one of the votes that brought it into power.

After the formation of the Government, the usual explanations of the position of affairs were given in both Houses of Parliament, Lord Derby attempting to show that the destruction of his Ministry had been plotted by an unprincipled combination of hostile factions. On the contrary, as Sir George Cornewall Lewis says in one of his letters, "there was no real anxiety on the part of the Opposition to turn out the Government; the sections of it were divided, and there was none of that coalition' which Lord Derby spoke of. The Budget, however, was more than human flesh and blood could bear. The promises of a substitute for Protection which Disraeli had made at the Elections rendered it necessary that the Government should propose something which appeared for the benefit of the agriculturists. They sounded some of their supporters among the county members as to a transfer from the locai rates to the Consolidated Fund; but I believe the answer they got was, that a measure which destroyed the power of the magistrates and the local

* It was partly by Macaulay's persuasion that Lord John permitted himself to be embalmed in history as the fourth Prime Minister of the century who, after serving as Premier, accepted an inferior rank. The other three were Sidmouth, Goderich, and Wellington. "Russell's example," says Mr. Spencer Walpole, "indicates that a man who has once served in the highest place had better refuse all subordinate offices." Cf. Walpole's History of England, Vol. V., p. 61; and Trevelyan's Life of Macaulay, Vol. II., Chap. XIII.

+ Martin's Life of the Prince Consort, Chap. LXVII