appeared to find relief in bitter epithets heaped upon his daughter; his self-love and his wounded pride dictated them, and he had no conception of his son's deeper feelings. Ernest listened, and bore what was pain to him for the sake of what he had to do. He succeeded in convincing his father that Dorothea's character must be upheld, that she must remain at Badheim, and be seen in public in her father's presence, to silence the tongue of slander. It was now time to think of Florian Geier. Ernest spoke his name with an effort.

'I shall make no objection to the marriage,' said the Graf; the Professor is a plebeian and a pedant, but he is good enough for her under these circumstances. I shall press a speedy union.'

Ernest.

'Impossible,' replied "This man, whose suit we accepted for my unhappy sister, is a man of honour. There can be no marriage now.'

'I will double her dowry,' said the Graf.

'You may treble it, but he will not do it; he is an honest man.'

'You are a visionary; leave the Professor in my hands,' his father answered, and keep your dreams for your sleep. Go now to your rest, and trust this business to me.'

With these words he left his son's bedchamber, where this dialogue had taken place, and left him with solitude in his heart. Through the long night he sat there in a fixed position, his elbows resting on the table which held a portrait of his sister, and a letter (his own letter with Ida's superscription) side by side, contemplating with the fascination of grief which clings to its birthplace, those two objects. With the fondness of a parted friend who sits gazing at a grave, as if from the corruption which it hides it were still possible to reclaim something of the sweet lost life, he remained contemplating the memorials of his buried hope; and

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in the morning his servant found him asleep in this attitude.

The result of the Graf's interview with Florian proved Ernest to be in the right; and the old courtier sustained a surprise. He found a man in whom the sense of honour was stronger than the love of advancement and wealth, and that man was the awkward and pedantic Professor. Florian listened to his overtures with dismay and the severe pangs of mortification; he was almost broken-hearted, for Dorothea had been his vision of pure beauty. He had lived in a dream, and he had never suspected her. He turned away from her cold father and hid his face. Ida, the next day, received a visit from him. It was a parting visit; he had obtained a leave of absence from the Grand-Duke, and he was going away for some months. But the object of his visit was a request that Ida would not withdraw her kindness from Dorothea.

'Her brother,' said he, 'is keeping aloof from her; her father was never much to her, and will be less still. She has no true friend but you, and her temper is such that suffering may turn to despair, or even death, if some good soul does not help her. You, Miss Conway, go to her, comfort her, and do her good; and tell her that I shall think of her for ever as when we first met, and not as we now part.'

Ida, deeply moved, bowed her head in acquiescence; and they separated with expressions of regard, Ida's conscience, when the Professor was gone, drawing for her a parallel between herself and this man, whom she used to look on with no small measure of contempt, which was unfavourable to her self-esteem. She had found in him the divine virtue of forgiveness; and his last thought in leaving the place which the sharpness of his wrong had made intolerable to him, was for the welfare of the wretched creature who had betrayed him.

POST

A BILL was introduced into Parliament by Mr. Gladstone early in the present Session (the embodiment, it is said, of an idea of Sir Rowland Hill's), the object of which is to effect an important modification and extension of the present Savings Banks system. Amid the forebodings of a few dismal prophets of evil, the discontent of some who desire a more radical reform of the whole system, and the enthusiastic support of most competent judges, the new measure has received the assent of the Legislature, and the powers conferred by it will shortly be put into operation. Considering that the fund belonging to depositors in Savings Banks in the United Kingdom has at the present time reached the enormous sum of fortyone millions sterling, while its growth is still vigorous, it will not be unprofitable to devote a little attention to the examination of a scheme which, if successful, will probably absorb a large part, perhaps ultimately the whole, of this fund; a result which would, as will hereafter appear, be attended with important consequences to the nation. Nor is the measure less striking viewed in its relation to the depositor. Classes to whom the existing Savings Banks afford but small facilities will be for the first time invited to become depositors, to enrol themselves among the stakeholders of the country, and by the cultivation of one habit of prudence, to instil into the character a temper of forethought which cannot fail to extend itself to other and to more important interests.

We propose, then, to offer a sketch of the theoretical constitution and practical working of the existing system, to exhibit its more obvious defects, and to examine how far these defects will be cured by the new measure.

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It has always been in the power of any individual or collection of individuals to set on foot a savings bank, provided they could find persons sufficiently confiding to entrust them with the care of their property; and though propositions have been made to restrict the use of the title of 'Savings Bank' to establishments under the Government protection (a measure obvious utility), the law remains in this respect unaltered.* The managers of such a bank would be accountable to no one save the depositors, with whose money they would be able to deal at their absolute discretion, subject only to the special contract they might make with the depositors. Of this kind were all Savings Banks previously to the year 1817. They were generally set on foot by the wealthy and charitably disposed persons of a locality for the encouragement of the poor of the neighbourhood, who on their part placed confidence in the character and position of the directors. In the year 1817, Government passed the first measure for taking under its protection such of these institutions as chose to avail themselves of the opportunity; and since that date a number of Acts have been passed for regulating the details connected with the administration of the funds, the extent of supervision, and other kindred matters. He would be a bold person who should undertake the task of analysing these Acts, of selecting the portions of them unrepealed by the subsequent enactments, of reconciling the inconsistencies, and evolving from the whole an intelligible meaning. It is not proposed here to enter upon an attempt so herculean; it will be sufficient to describe the practice to which, at all events, custom has given the force of law, without pronouncing

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whether or not the powers exercised are in excess of those which Parliament has conferred.

The management of Savings Banks, so far as relates to the Government control, is conducted through that heterogeneous body known as the Commissioners for the Reduction of the National Debt. Every member of this Commission is such virtute officii. It comprises the Speaker of the House of Commons, the Chief Baron of the Exchequer, the Master of the Rolls, the Accountant-General of the Court of Chancery, the Chancellor of the Exchequer, and the Governor and Deputy-Governor of the Bank of England. As might be supposed from the circumstance that most of the members of this body have important and engrossing duties to perform elsewhere, the meetings of the Commissioners for the transaction of business relating to Savings Banks are not very numerously attended. This business is, in fact, practically conducted by three of them only-the Chancellor of the Exchequer, and the Governor and Deputy-Governor of the Bank of England, the others having no more concern with the matter than if they were entire strangers to the Commission. To these should be added the Comptroller-General, who, though only the agent of the Commissioners, exercises in practice very extensive powers.

When it is desired to establish a new Savings Bank, or to bring one already in existence under the Government system, a written application has to be made to the Commissioners, accompanied by a list of the actual or proposed trustees and managers; and after a few formalities, the bank is privileged to open an account with the Commissioners. Thenceforth the trustees and managers are relieved from the trouble and responsibility of making investments on behalf of the depositors. They retain a sufficient working balance, and forward from time to time any surplus there may be to the Commissioners, the depositors receiving the national guarantee for the repayment

in full of all sums so aciple of together with a high rateing posrest. As might be expec's further majority of the Savings Banks have availed themselves of these advantages, and the result has been that the amount credited to the trustees by way of interest up to the present time exceeds that which the money invested by the Commissioners has actually yielded by a sum exceeding three millions; and in spite of the great reductions that have been made in the rate of interest allowed-by the last of which, in 1844, it was fixed at the comparatively low rate of three and a quarter per cent.-the national liability is every year increasing from this cause, and that in a constantly augmenting ratio. There are also other causes which have tended to swell the national liability; for the Commissioners must of course invest the money as it comes to their hand, retaining only a working balance, while any long-continued demand on the part of the depositors equally necessitates a sale of a portion of the investments. Now the more prosperous the condition of the country, the larger will be the savings of the working classes, and this state of things is usually accompanied by a high price of the public securities; on the other hand, the largest withdrawals will take place when trade is in a depressed condition-that is, in all probability, when the public funds are at the lowest. Purchasing in a dear market, and selling in a cheap one, is of course a losing trade, and there can be no doubt that the Savings Bank fund has suffered materially from this cause, though the amount of loss it would be extremely difficult, perhaps impossible, to estimate. Finally, if we add that the expenses of management, so far as the Government is concerned, have hitherto been defrayed by the nation, we shall have indicated the principal sources from which the national contribution in aid of Savings Banks arises.

Is, then, the Government Savings Bank a charitable institution?

Sas it may appear, that is one which it is not posanswer. It is impossible to say whether the pecuniary advantage derived by the nation from the employment of the Savings Bank fund has or has not counterbalanced the national contribution in aid of that fund. That a comparison of the assets at the present time in the hands of the Commissioners with the liabilities to the depositors would disclose a deficiency, a large deficiency, is true; it is also true that the nation is liable to make good this deficiency; but it does not follow that this de ficiency is a measure of the national contribution in aid of Savings Banks. It may be that, had the Savings Banks fund been treated strictly as a trust fund, there would have been at the present time a surplus instead of a deficiency; that we have in point of fact been consuming a portion of that fund for public purposes, that is, living upon capital; increasing the national debt by a process the more dangerous because unsuspected. Many indeed, and Mr. Gladstone among the number, assert that the nation has repaid itself its contribution ten times over by the use of the Savings Bank money. In that case it would appear that, so far from the Government Savings Bank being a charitable institution, it has actually been the source of a considerable revenue, the whole of which we have consumed, and not content with that, we have even taken a considerable slice out of the corpus of the fund, leaving the settlement, if a settlement should ever be necessary, to posterity. What are the facts?

It has been customary for successive Finance Ministers to treat the Savings Bank fund as a convenient and available resource in times of financial difficulty. Thus, suppose the price of the public securities is so high that it is possible to effect a reduction of the interest. The obligation of paying off the dissentients at par renders it necessary to provide a sum as a safeguard. But the sum that will be required is uncertain, and it is difficult to raise

a sufficient amount except on onerous terms. There is an obvious resource; the Chancellor of the Exchequer at his absolute discretion can sell out any amount of the stock belonging to Savings Banks (and this can be managed so quietly that no one will suspect what he is about), until enough is raised to render it prudent to meet the dissentients, whose stock is of course purchased at par, and becomes the property of the Savings Banks.

Again, there is a larger amount of Exchequer Bills in the market than will float; they are at a considerable discount, and it is feared that the interest upon them must be raised; the Savings Banks come to the rescue and purchase enough to sustain the price. Or perhaps it is desirable, in order to meet State necessities, to issue fresh Exchequer Bills, the market being already surcharged; a buyer is always at hand, and one, moreover, who, unlike the generality of buyers, is not to be repelled by the circumstance that these securities are at a discount; on the contrary, whatever be the state of the market, the Savings Banks are always ready to take off any quantity at par.

Operations such as these have been repeatedly performed, and not doubt with a considerable apparent gain to the public. But passing by for the present the question whether the Finance Minister of the day ought to be entrusted with powers so enormous, and looking merely to results, to what account ought any extra profits realized through the agency of the Savings Banks fund to be placed? Clearly to the credit of that fund. Suppose the fund had not existed or had never been under the control of Government. We should still have found means to reduce the interest on the Four per Cents. and on the Three and a Half per Cents.; we should still have managed to raise supplies for the Crimean war. We should have done all these things, but we should have paid perhaps two or three millions more than we did pay, and these two or three millions should in fairness be deducted in our estimate of the

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national contribution to Savings Banks. It is not sufficient to say that so long as the Government pays three and a quarter per cent. interest, and guarantees the principal and accumulations, the depositor need not trouble himself by inquiring what is done with the money. If this course is satisfactory to the depositor it is not satisfactory to the nation, and the practice has proved extremely pernicious, both by encouraging a rate of taxation below what the true annual expenditure would require, and by allowing an admixture of accounts which has effectually obscured the real position of the nation with regard to Savings Banks.

The result, then, is this. There is at present a large deficit. If every depositor were to call for his money to-morrow, the assets in the hands of the Commissioners would, at the present price of stocks, prove insufficient by about five millions. This sum of five millions the nation would have to provide. A certain unascertained portion represents capital already consumed for public purposes, the remainder being a charitable donation. Fortunately, as long as the deficit bears only a small proportion to the total investments, it is not probable that the nation will be called upon to make it good. But it should be known that the deficit is at the present time increasing at the rate of nearly £100,000 per annum.

In other words, there is annually credited for interest to the trustees of the Savings Banks the sum of nearly £100,000 above what the Commissioners actually receive from the investments. No doubt the amount of the deposits is increasing in a still greater ratio, but such increase may have its limits; events may check the stream or even cause it to flow in the other direction; the complete success of the new measure might have such an effect; in such a case the proportion of the deficit to the deposits would steadily increase until it became absolutely necessary at a heavy expense to atone for past delinquencies. Unless, then, we are

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prepared to adopt the principle of living on credit and leaving posterity to pay the bill, the further growth of this charge ought to be checked at once.

Of course, the sum we have named as the present deficit does not by any means represent the limit of what we may ultimately be called upon to pay. The real limit depends on the amount of the deposits and the possible depreciation of public securities. Theoretically there is always the chance of the whole of the depositors claiming their money when the Three per Cent. Stocks are at 50, or lower. This, moreover, is a liability from which there is no way of escape except by means that would seriously impair the utility of Savings Banks, if not destroy them altogether. To make the repayment to the depositor dependent upon the price of Stock would no doubt remove the national liability, but would have a most prejudicial effect in other respects. The object of the depositors is not speculation, but security. Consisting as they do mainly of uninstructed persons, they would probably look on any considerable loss on their investments in the light of robbery, if indeed they could be induced to deposit at all under such a system. Any marked fall in the price of public securities, or even a widespread apprehension of a fall, would cause large withdrawals, involving of course the sacrifice that must attend such an operation; and in short, the character and object of the investment would be altogether changed. We must therefore console ourselves with the extreme improbability that the whole or the greater part of the deposits will be withdrawn under any circumstances of pressure, an opinion which is confirmed by our experience during war, during commercial crises, and even during famine. Still, when we are told that the new system is to be strictly selfsupporting, while the Government guarantee is to be even more perfect than at present, we see that the words can only be taken in a restricted sense. Probably what is