‘Still in thy right hand carry gentle peace.’

But England went to war with Spain ‘on the right of search.’  From 1691 to this time the debt had increased on an average about a million sterling per year.  As early as 1745 the credit of the bank was so identified with that of the state, that during the invasion of the Pretender, whose forces were at Derby, only one hundred and twenty miles from London, the creditors of the bank flocked in crowds to its counter to obtain specie for its notes.  The merchants intervened and signed an agreement to make the bank’s notes receivable in all business transactions.

The war of the Austrian succession followed in 1742, and at the Peace of Aix-la-Chapelle, in 1748, ‘forever to be maintained,’ the English were saddled with a debt of L75,000,000.

  ’Peace hath her victories,
  No less renowned than war.’

It was early in the last century that the abuse of paper money gave a lasting and unfavorable impression against such issues.  The scheme of John Law and the South Sea Bubble about the same time broke and scattered their fragments over both England and France.  It was in the latter scheme or folly that Pope lost a large portion of his earnings, from which we may infer that his temper was not improved.  He wrote, in his Third Epistle, dedicated to Lord Bathurst: 

  ’Statesman and patriot ply alike the stocks;
  Peeress and butler share alike the box;
  And judges job, and bishops bite the town,
  And mighty dukes pack cards for half a crown.’

In the same ‘Moral Essay’ he alludes to paper money in the following lines: 

  ’Blest paper credit! last and best supply! 
  That lends corruption lighter wings to fly! 
  Gold imp’d by thee, can compass hardest things,
  Can pocket states, can fetch or carry kings;
  A single leaf shall waft an army o’er,
  Or ship off senates to a distant shore;
  A leaf, like Sibyl’s, scatter to and fro
  Our fates and fortunes, as the winds shall blow: 
  Pregnant with thousands flits the scrap unseen,
  And silent sells a king, or buys a queen.’

These are among the earliest tirades against paper money; which, like many other good things, is condemned because its power has been abused and prostituted.

England’s enormous debt, which should have warned the Georges against further war, was not contracted without severe sacrifices.  The legal rate of interest at the opening of the funding system was six per cent.  In 1714 it was reduced to five per cent.  Loans during the early wars of the eighteenth century were raised on annuities for lives on very high terms, fourteen per cent. being granted for single lives, twelve per cent. for two lives, and ten per cent. for three lives.  But so far was England from being awake to the enormous debt she was creating by her expensive wars, that the seventy-five millions existing in 1748 became L132,000,000 at the close of the Seven Years’ War in 1763.  This volume was enlarged at the end of the American Revolution to L231,000,000.  During all this time the bank was the lever with which these enormous sums were raised; but the end was not yet.