Front Page Titles (by Subject) 350.: ricardo to heathfield1 - The Works and Correspondence of David Ricardo, Vol. 8 Letters 1819-June 1821
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350.: ricardo to heathfield1 - David Ricardo, The Works and Correspondence of David Ricardo, Vol. 8 Letters 1819-June 1821 
The Works and Correspondence of David Ricardo, ed. Piero Sraffa with the Collaboration of M.H. Dobb (Indianapolis: Liberty Fund, 2005). Vol. 8 Letters 1819-1821.
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First published by Cambridge University Press in 1951. Copyright 1951, 1952, 1955, 1973 by the Royal Economic Society. This edition of The Works and Correspondence of David Ricardo is published by Liberty Fund, Inc., under license from the Royal Economic Society.
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ricardo to heathfield1
Upper Brook Street, 19th December, 1819.
I ought, long before this time, to have thanked you for the present of your excellent pamphlet,2 on the means of paying off the national debt, and to have expressed to you the pleasure which I derived from its perusal; but I have been so much engaged of late, that, till now, I have not had leisure to make the few remarks which I was desirous of submitting to you on some parts of your clear and perspicuous statement.
I entirely concur with you in your general view of the desirableness of extinguishing our debt, and declared my opinion to that effect in a publication of mine, given to the public about two or three years ago.1 During the autumn which is just passed, I have been employed in giving my thoughts rather more in detail, on the same subject, in an article written for the Encyclopaedia Britannica Supplement, and which was to have been published last month. Mr. Napier, the editor of this work, had my article in October last, but has deferred the publication of it till the next period of publication, because he found that he could not reach the Letter to which it was to be appended, without making the volume just published too bulky. As our opinions coincide remarkably on this question, I thought it right to make you acquainted with these facts, that you might not suppose that I had, without acknowledgment, borrowed your arguments. The chief difference between your opinions and mine are the following. You would pay the stockholder at 100. I think he will receive a full measure of justice, if he is paid at the present market-price, or about 70, for his three per cents. As we are now proceeding in the payment, or rather, non-payment of debt, he can never reasonably expect to receive 100, but may more justly expect to be eventually a loser of the whole of his capital. Your reasoning on this point, page 25, is not satisfactory, for you there assume that the stockholder would re-invest his capital at an interest of three per cent; such a fall in the rate of interest being, in your judgment, the natural effect of the payment of the debt: but why interest should fall from five to three per cent, without any increase of capital, or diminution of population, I cannot conjecture, and I do not perceive that you have said anything in favour of such a conclusion.
We differ, too, on the effect which the reduction of the debt would have on the agriculture of the country. It would not, in my opinion, enable us to compete with foreign growers of corn, in a degree the least more favourably than we now can do, and, consequently, I think that if a corn law be now necessary to favour our landed interest, it will be as necessary when the national debt is paid. You say (page 10) “that under the supposed relief from impost, the people would be cheaply fed, and that great and powerful impulse to the agriculture of the United Kingdom would be experienced.” You think, too, (page 11) “that the remission of duties and taxes would greatly augment the demand for manufactures:”—I cannot help thinking that we should not experience any such advantages.
I am sure you will forgive me for the remarks which I have taken the liberty of making on your ingenious pamphlet. If you are desirous of knowing the reasons on which these remarks are founded, I shall be glad to state them to you on any morning that you will favour me with a visit. I will make a point of being at home, any hour that may be most convenient to you.
I am, Sir, Your obedient Servant,
Richard Heathfield, Esq.
[1 ]Printed in a pamphlet entitled Speech on the State of the Nation, delivered in the House of Commons, on the Third Reading of the Reform Bill, on Tuesday, March 20, 1832, by General Palmer. To which are prefixed, a Letter from the late Mr. Ricardo to Mr. Richard Heathfield, on the Liquidation of the Public Debt, and some Observations thereon, London, Longman, 1832. Gen. Charles Palmer in this speech recommended the adoption of Heathfield’s plan for paying off the national debt by means of a tax of 15 per cent. on all property. The ‘Observations’ are signed by Heathfield and dated ‘8 Regent Street, London, 12th April, 1832’; they contain a reply to Ricardo’s objections.—Letters to Trower, XXXII.
[2 ]Elements of a Plan for the Liquidation of the Public Debt of the United Kingdom; being the draught of a Declaration, submitted to the attention of the Landed, Funded, and every other Description of Proprietor of the United Kingdom. With an Introductory Address, London, Longman, 1819.
[1 ]Principles; see above, I, 247–8, and cp. the speech on 16 Dec. 1819, above, V, 34–5. Ricardo’s and Heathfield’s ‘fanciful plans’ were jointly attacked by an anonymous radical writer in A Letter to the King; shewing, by incontestible facts, the Fundamental Causes of our Unexampled National Distress; and containing a Proposition whereby we may hope to obtain Substantial and Permanent Relief compatibly with the Preservation of the Established Order of Society: in contradistinction to the Puerile Schemes and Fallacious Theories of Messrs. Baring, Ricardo, Heathfield, and the whole Fraternity of Paper Money Men without Real Capital, By A Commoner, London, W. Benbow, 1820. See also Cobbett’s ‘Letter to Lord Liverpool on Heathfield’s Plan for Paying Off the National Debt’, in Weekly Political Register, 22 April 1820.