Front Page Titles (by Subject) Trenchard: A Comparison between the Proposals of the Bank and the South-Sea Company, wherein is shewn, that the Proposals of the First are much more advantageous to the Publick, than those of the Latter; if they do not offer such Terms to the Annuita - A Collection of Tracts, vol. I
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Trenchard: A Comparison between the Proposals of the Bank and the South-Sea Company, wherein is shewn, that the Proposals of the First are much more advantageous to the Publick, than those of the Latter; if they do not offer such Terms to the Annuita - John Trenchard, A Collection of Tracts, vol. I 
A Collection of Tracts. By the Late John Trenchard, Esq; and Thomas Gordon, Esq; The First Volume. (London: F. Cogan, 1751).
Part of: A Collection of Tracts, 2 vols.
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A Comparison between the Proposals of the Bank and the South-Sea Company, wherein is shewn, that the Proposals of the First are much more advantageous to the Publick, than those of the Latter; if they do not offer such Terms to the Annuitants as they will accept of.
AS I have compared in my own Mind, the constant Encrease of our Publick Debts, to a Cloud gathering over the Southern Seas, impregnated with Thunder and Lightning, and big with the Magazines of an Hurricane, which at last sweeps away Houses and Woods, as well as every thing else before it; so I receive the truest Pleasure in observing an universal Disposition in my Countrymen, to endeavour to discharge themselves honourably from so dreadful a Burthen. I think it is every honest Man’s Duty to give his utmost Assistance to so desirable a Work; and therefore I think myself obliged to offer such Considerations to my Superiors, as appear to me necessary to make the Attempt effectual; that it may not end in a Job to get Plumbs for a few Projectors, ruin Thousands, and disappoint the Publick.
I am unfashionable enough to declare my Thoughts openly, that as I think it is the highest Crime, so I wish the greatest Punishment was inflicted upon any Persons in his Majesty’s Councils, and the Management of his Finances who shall presume to Stock-job and Buffet about the Publick Revenues; and by the Knowledge of their own Intentions, to raise them and depress them at their Pleasure, and as they see their Advantage; and so to make Bargains, for themselves, whilst they are ruining the Kingdoms. I hope there are no such now: But I doubt it is too melancholy a Truth, that to this Conduct in former Reigns, we owe the greatest part of our Miseries.
I dare own too, that I heartily wish the Bank of England had found it their Interest to have made such a Proposition as might have been acceptable to the Parliament; because I conceive they could have effected it with Advantage to themselves, as well as to the Publick, for the following Reasons.
1. They are in Possession of a great Credit, and by their Bills alone could have paid some Millions of the Debt.
2. They have near Four Millions of it already engrafted in their Stock, and without doubt have great Effects besides, which they have bought in the several Funds, and consequently they would have had so much less of the Publick Debts to have discharged.
3. They have oftener than once already saved the Kingdom, by bringing down the Price of Interest, assisting it in its greatest Exigencies, and have always acted with Reputation and Candour: And indeed, from the Nature of their Constitution, it is almost impracticable for them to do otherwise, or for their Directors to enrich themselves at the Society’s Cost; and therefore very many People would have engaged with them, who will not venture their Money in a Trading Company; where the Managers too often squander away and parcel out amongst themselves, their Relations and Followers, the Publick Money, under the Pretence of Traffick, and then must make their Proprietors Recompence, by dividing out their Capital, which they make them to believe is only Interest, and the Profit of the Trade; by which means, the more of their Principal is taken away (like a Hole in the Wall) the greater it grows, and for a Time sells for more too: But at last, the poor People find themselves beggared, and have no way to prevent their Ruin, but by selling out betimes, and ruining others.
4. If the Bank had undertaken it, there could have been little Danger threatened to the Publick from the Influence of so formidable a Society; because another great Body would be subsisting with Twelve Millions Capital: Which, added to the Assistance of the East India Company, might, and probably would have been a great Ballance against it; besides there could have been no Danger of the Courtiers over-loading them with new Favours.
5. The Capital of the Bank is Seven Millions less than that of the South-sea Company; and therefore the Profits arising to the Proprietors, from paying off the othet Funds, and striking New Stock in lieu of them, must have been divided upon a proportionably less Capital; and consequently, they could have afforded to have allowed much greater Encouragement to the Annuitants, with yet greater Profit to themselves; and in Fact, they did openly and above board offer Seventeen Hundred Pounds Bank-Stock, for every Hundred Pounds per Annum of the long Annuities; which is Twenty Five Years Purchase and an Half, if their Stock continued at One Hundred and Fifty, and Thirty Four Years Purchase, if it ascended to Two Hundred; and in the like Proportion, according as it rose more or less.
However, as every true Englishman ought to have no View in an Affair of this great Importance, but what would most conduce to the publick Benefit; so all the Advantages above-mentioned did not, nor ought to have hindred the Acceptance of a better Proposal from the South-Sea Company, who have certainly offered more advantageous Terms to the Publick, provided they offer equal Terms too, to bring in the Annuitants, and are contented with their Bargain in the Manner it is made; which no one sure can doubt of, it being by their own Acknowledgment a very good one; since they, in effect, declared they were ready to give more, if any others would give as much.
Therefore I take the less Notice of the little Jobbing Tricks played, and Reports given about in the Alley, to raise Stock, viz. That New Advantages are to be given. New Trades annexed, and that since the Publick expect from them to raise such Sums of Money, they must find Means to enable them to do it: Such Artifices and such jugling Proceedings, can never enter into the Thoughts of any Member of that Honourable House, which accepted the Proposal. Who can suspect that the Guardians of the Publick Treasure, will ever wantonly squander away any part of an advantageous Contract they have made for their Country; and give better Terms than are asked, if these can be performed? And if not, it is still more absurd to imagine, that they will reward any Number of Men whatsoever, for betraying the Publick, by offering a Project which they could not execute, and disappointing another, which could not have miscarried.
It will be embezzling the publick Treasure, and encreasing our Burthens, instead of lessening them, if we give away needlesly not only what is already Money or Wealth, but such Advantages and Privileges as will purchase them from any other Body of Men; for it will be ridiculous to say, any Concession will cost the Publick nothing, which will hurt and prejudice the Publick, or yield the Publick something: Besides, ’tis but common Justice to the Bank of England, (to those whose Conduct we are beholden even for the present Proposal) to give them the Preference; if by adding, curtailing, tossing, tumbling, or mangling the accepted Proposition, it should be rendered but equally advantageous to theirs, much more if it should become less so; the Breach of the Contract will lie at their Door alone, who decline to execute it, or confess they can’t execute it by demanding New Conditions.
The reason I think it necessary to say thus much is, because I find many Persons engaged in the South-Sea Company, who think, or pretend to think, that they have the Choice of the Alternative, either to buy in the Annuitants, or to pay Six Hundred Thousand Pounds in lieu of it, which I dare say is not the Thought of any Man in the Kingdom, besides some of themselves: We all understand, that they offered the Penalty only as an Earnest, to assure us that they intend to give such Conditions as the Annuitants will be inexcusable; if they do not accept of; which ought to be equal at least to those already offered by the Bank; and I could wish they would silence the Scruples of some, and the Calumnies of others, by obliging themselves to it in the Bill, or at least would make as open and frank a Declaration of their Intention, as the Bank has done.
For the Proposal of the Bank is exceedingly more advantageous than that of the South Sea; provided the Bank Proposition brings in the Annuitants, and the South Sea Company only pays the Penalty, even tho’ the Latter should be kept strictly to their Bargain; for all that then would accrue to the Publick by it, would be but four Millions Six Hundred Thousand Pounds, when it’s all paid: And ’tis more than probable, that Sum, as great as it is, will not in Reality lessen the publick Debts at all (it’s well if it does not encrease them) because the Annuities, in all likelihood, will rise in Value above Twenty Years Purchase (the Price the Publick are to redeem them at by this Proposal) more than that Sum will discharge: Whereas what the Bank offers, will effectually pay off so much of our Engagements.
There is besides the Difference which might probably accrue to the Publick by the Bank’s offering to be redeemed at 1724, and the South-Sea’s accepted Alternative, to be redeemable at 1727; which by some is computed at more than Eleven Hundred Thousand Pounds, and by themselves at not less than Seven.
As I think I have fully shewn, that the Proposal of the Bank of England is vastly better to the Publick than that of the South Sea, if the First brings in the Annuitants, and the Others do not; so I will as plainly shew, that if the Latter are not obliged to offer them such Conditions as it will be their Interest to accept, that they must be Men of very uncommon Virtue, and intirely detached from all personal Considerations, if they do it of their own Accord.
’Tis evident, that all the Advantage which can accrue to them by this Bargain, (which they Purchase at so many Millions) over and above receiving good Interest for Seven Years, is the striking New Capital for as much as they pay of the publick Debt; that is to say, for every Hundred Pounds they discharge, they are to have the Liberty to add and sell to the fairest Bidder, One Hundred Pounds of New Stock; and if that can be sold at the current Price (which we will suppose to be One Hundred and Seventy) then Seventy Pounds will be got by the Company; which Profit arising equally upon near Sixteen Millions, there will remain more than Seven Million, clear Profit to the Company, after Four Millions paid to the Publick; and so proportionably more or less, as the Stock rises or falls.
Now it must be obvious to every one, that it can never be their Interest to bring in the Annuitants, before all the redeemable Funds are paid off, and the New Stock is struck and sold; for that would be to call in Shares to divide this great Sum with themselves, and lessen their own Profit above half, by admitting Fifteen Millions more Capital: They will hardly think it worth their Time to give the Publick Four Years and an Halfs Purchase for such Annuitants, and to give the Annuitant great Encouragement besides, to accept the aforesaid Favour; and if they do not, I am persuaded they have too much Modesty to expect the Annuitants to come in without it: Since, as is said before, almost the only Foundation of their Stock now bearing such a Price, is the Advantage which will arise from selling the New Interest.
Besides, how long can it be reasonably supposed, Twenty Seven Millions more of principal Stock will be selling off? (which Sum the whole will amount to at One Hundred and Seventy per Cent.) for if we could suppose (which I take to be a very sanguine Imagination) that the Sixteen Millions paid off would all be vested in this Company, there will yet remain Eleven Millions, for which fresh Money must be found.
It is very unlikely, that so great an Interest should be sold, without spending part of the Term in doing it, or sinking the Stock, (which will spoil all) and then how can the South-Sea offer the Annuitants such Terms as the Bank have already proposed? For when the Advantage arising from this Bargainis at an end, the Seven Millions divided amongst the present Proprietors, and their Term of Seven Years shortned, what imaginary Hopes can there be, that their Stock will keep at the advanced Price? which it must do, to enable them to pay Four Years and a half Purchase to the Publick, and yet give such Encouragement, as the Annuitants will accept of; nor is it possible to suppose a Circumstance, how they shall be capable of doing all this, without its appearing at the first View, that it is more their Interest to pay the Penalty.
Therefore I hope I shall not deserve the Imputation of Calumny, if I surmise, that no Member of the South-Sea Company can oppose a Proposition so reasonable, as that they should be obliged to declare what Conditions they will give to the Annuitants; but such who design not the publick Interest, but their own; who intended us a Missisippi Company, would have had vastly greater Advantages squandered away for less than half the Sum which is now offered, and who have been cooking up a Project for Seven or Eight Months last past, under the Pretence of paying off the Publick Debts, but in Truth to new burthen the Publick, and enrich themselves; and who, if they are let alone, will turn this great Design into a private Job; and when they have worked up their Stock by Management to an unnatural Price, will draw out, and leave the Publick to shift for itself, till the Season comes round about for gathering new Plumbs.