The result of this abortive negotiation was again to divide the Opposition. Not only Shelburne but Grafton, Camden, and even Richmond, whom Rockingham had intended to form part of his new arrangement, expressed the utmost indignation. Shelburne himself retired into the country. On the 1st of September, Parliament was dissolved, and the new elections again gave the Court a majority. Among the new members were William Pitt and Sheridan.
During these events the intimacy of Shelburne with Dr. Price continued undiminished, and more than once when speaking on financial questions he acknowledged the obligations he was under to him. Quite apart from the question of the soundness of his views, there can be no doubt that Price conferred a great service by calling attention to the growth of the National Debt and to the necessity of reducing it. To this opinion Shelburne, it has been seen, was an early convert.
The discovery that the scheme put forward by Price had the effect, so far as it proposed to support the Sinking Fund by loans in time of war, not merely of not diminishing, but of actually increasing the debt, has caused his merit as a financier to be as unduly depreciated by posterity as it was unduly exalted by his contemporaries. Till the moment arrived when a loan had to be made, the Sinking Fund operated on perfectly sound principles; not indeed by the magical virtue of money growing at compound interest and paying off debt without burdening the tax-payer, in defiance of the Lucretian doctrine, that something cannot be produced out of nothing; but by the application to the reduction of debt of the excess of revenue above expenditure. Capital to increase at compound interest must be invested in some reproductive employment, and it is an abuse of terms to describe the reinvestment of the interest of stock as an investment of capital at compound interest. The modes of operation are the same, but the means when examined are seen to be totally different. It is not however quite clear that Dr. Price or Lord Shelburne or Mr. Pitt really thought
