will probably amount to about seven thousand millions after allowing for loans due from the Allies and Dominions so far as they are likely to be then recoverable.  Taking interest at 5 per cent. with a sinking fund of only half per cent., it is estimated that the permanent annual charge in respect of the Debt will then be about 380 millions.  No doubt part of the Debt bears interest at a lower rate than 5 per cent., but a portion has been borrowed at a higher.  This is on the assumption that the War will end within this financial year.  Even if the War does end within the financial year, much of the expenditure occasioned by it must go on during the period of demobilisation, and during part of that period the Debt will probably go on growing, as it can hardly be expected that sufficient revenue can be raised by taxation to meet this continued expenditure directly due to the War.  There will also be for many years to come a very heavy expenditure on pensions, and, whatever other savings may be effected, the duty of providing pensions for injured and disabled sailors and soldiers is paramount, and the provision must be made generously.

It seems highly probable, therefore, that the annual Debt service will ultimately amount to nearly 400 millions, and may be much more if the War goes on over 1919.  It is a gigantic burden to bear.  Mr. Bonar Law has stated in the House of Commons that a loan of one thousand millions represents the labour of ten million men for a whole year, so we may take it that the annual charge for the National Debt will require the whole labour of four million men to meet it, and that this charge will be continuous for many years.  The normal expenditure after the War, apart from Debt service, has been reckoned to be 270 millions.  It will certainly be more unless rigid economy is practised and all the new schemes which are being proposed involving expenditure of money are carefully scrutinised to see whether the expenditure is such as the country ought to undertake in view of its financial obligations.  As the Debt service will be practically constant and irreducible unless revenue largely exceeds the total annual expenditure, which is very improbable, it is clear that a strong effort must be made to reduce this expenditure and also, so far as possible, to increase the State revenue.  Unless this is done there will be a deficit even after the War, and the Debt will have to be increased to meet it.  There is no question of greater urgency, and it must be resolutely faced.  We shall probably find a disposition, both in the Government and in Parliament, to shirk it.  The influence of the extension of the electorate will, in all likelihood, be against rather than in favour of economy.  There is a common assumption that people can get the State to pay for things instead of paying for them themselves; that there is no need to practise personal economy or to save because the State will provide.  Wage-earners who began by practising some self-denial in order to save have said, “What is the use of troubling?  The man who saves is really no better off than the man who spends all his earnings, as the State will provide what is required to meet the needs of the latter.”