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ney contained. It is indeed but too ments to which they unfortunately true, that in former times, our So- listened were mere sophisms: the exvereigns occasionally overstepped the perience of the last nine months must just limits of their authority; and we should suppose, have convinced to serve a temporary purpose dimic them, that they have been led into nished the weight, or debased the an error fatal alike to public prosquality, of the circulating medium. perity, and to the interests of a very But then these unauthorised acts of large body of private individuals. power were boldly avowed: they We cannot, therefore, but express were admitted to be fraudulent; for, an earnest hope, that the Legislature in those days, there were nó econo
will be induced to retrace its steps, mists to justify or gloss over the and rescue the productive classes wrong which the sovereign power from the total ruin which must other. found it its interest to commit. The wise fall upon them. purposes for which the sovereign But the reconsideration of the power in this country was originally question of the currency is not only Intrusted with the regulation of the become necessary, from a just recirculating medium should never be gard to the interests of private inlost sight of by Parliament when le- dividuals—a point which a wise and gislating respecting the currency. In equitable Legislature will never overthe discharge of its functions, it is look, but it is also recommended the duty of Parliament to afford to by the plainest principles of public every subject of this realm an equal policy. The mode in which the surand complete protection from wrong. plus revenue of every country is disHence it is its bounden duty to keep tributed and expended must, in the the standard of value, at an even ba- long run, produce a great effect upon lance, and thus prevent one class, the aggregate wealth and prosperity the class of creditors—from preying of the community. In proportion to upon--from devouring the property the amount of this net revenue, which of another class--the class of debtors. may be laid out in productive indusWith all the deference which it be- try, will be the rapidity with which comes us to feel on such an occa a nation advances in prosperity and sion, we beg to state it as our firm power. The history of this country belief, that when Parliament passes during the past forty years furnishes any measure, which even in a trifling the statesman with an useful illustradegree affects the exchangeable value tion of this important truth. The of the circulating medium, it over effect of the Bank Restriction Act, in steps any authority which it is ho- depreciating the currencyof thiscounnestly and constitutionally entitled try below its standard value, was no to exercise. Thinking, as we most doubt unjust towards the body of heartily and conscientiously do, that creditors, both public and private; the increased demand for gold was but however injurious it proved to inevitably occasioned by the suppres- that class of native capitalists, it is sion of the one-pound note circula quite clear that it had a direct tention, and has practically been attend- dency to promote public prosperity. ed with the effect of adding greatly to By lessening the real value of the the real value of the medium of ex demands upon them, it left every change in this country, we shall ne year a larger surplus of revenue in ver cease to consider the measure the hands of the industrious classes, 'unjust, oppressive, and inexpedient, and more especially of those engaged and to press for its repeal. We do not in the tillage of land. This surplus mean to say that the legislature pass- was not unprofitably squandered ; ed this measure with the design or it was not consumed and wasted in intention of committing an injury feeding a useless and unproductive upon any class of subjects. The ma train of menials and domestics : on jority who sanctioned the suppres the contrary, it was laid out in mainsion of the one-pound note currency, taining and feeding productive lawere deluded by the sophistries of bourers employed in the various opethe economists into the belief, that rations of husbandry; and by that no ill effect would result from its means it became the source of new opération. But surely they have by wealth, both to its owner and the this time discovered, that the argu public. All persons engaged in the
cultivation of land were enriched nied capitalist thus bloats upon the during that period; and the wealth affluence which the legislature has which they thus acquired being again incautiously as well as unjustly pourlaid out on the improvement of the ed into his lap, the producing classes soil, added incalculably to its produc- are impoverished and ruined. To tive powers. Hence the unequalled meet the demands of the moneyprosperity of agriculture, and with it, lender, they are year after year comof every other branch of industry, pelled to part with capital, which, if during that memorable and brilliant left in their hands, would be laid out period of our national history. We in improving the productive powers merely state this, as a well-known of the soil, and increasing the store consequence resulting from the de- of public wealth. When it comes inpreciation of the currency during the to the hands of the monied capitalist, suspension of cash payments. We it is laid out in a way which reprodo not undertake to disguise or de- duces nothing: it is expended upon fend the injury which was then in mere consumers ; upon cooks, footflicted upon all the creditors, both of men, and grooms : instead of being the state and of private individuals. expended, as it would have been, by But the recent changes which, on the farmer, in feeding labourers, who the recommendation of the econo- always reproduce considerably more mists, have been effected in our than they consume. There never has monetary system, are to the full occurred in the history of this counas unjust in principle, while they are try a period when the demand for incalculably more injurious and im- all commodities connected with the politic in their consequences. These luxuries of life has been as great as consequences appear to us so im- during the last fifteen years : and portant that we shall venture to dwell hence not only the capitalists themupon them. They will, we think, selves, who were annually profiting adequately account for the greater in an unjust measure by the changes portion, if not the whole, of the dis- of the currency, but even our states. tress, which now pervades the com men, waxed absolutely wanton in this munity.
apparent prosperity. It never ocThe depreciation of the currency, curred to them that we were conas we have already stated, caused ca- suming not only the net revenue, but pital to flow towards agriculture, and also gradually wasting the capital of other productive operations. The the country; while the top of the tree present undue enhancement of the seemed to flourish, decay had attackcirculating medium acts in an oppo- ed the roots; while the towns shewsite direction. It tends to withdraw ed every outward symptom of proscapital from tillage, and other repro- perity, the progress of adversity had ducing employments, and causes it commenced in the country ; our to be expended in occupations which streets and public places swarmed yield no return. By the operation with thriving faces and fair forms, of this unjust and impolitic rise in decked out in the gaudy fabrics of the exchangeable value of money, foreign countries: but our fields bean overwhelming proportion of the gan to go untilled, not because the net revenue of the country has pass- hands to cultivate them were wanted from the hands of the agricultural ing, but because the capital embarkclasses into those of unproductive ed in husbandry having been gracapitalists living in cities. Hence the dually absorbed by the operation of extension and prosperity of towns the currency bill, the farmer was within the last fifteen years. All the deprived of the means of paying for persons who depend upon fixed labour. The farmer well knows, that money incomes have been suddenly it would tend greatly to his own proand enormously enriched : they have fit if he bestowed more labour on his been enabled to build and occupy fields: but he bitterly feels that the
ger houses; to keep a larger train means of doing this have been taken of footmen and domestics, and to from him, and transferred into the revel in all the abundance and lux- hands of the tax-gatherer and moneyury which a dear currency and lender. The whole class of labourcheap commodities have placed at ers in husbandry have been in contheir command. But while the mo sequence put upon a short allowance
both of labour and food : they are in tomers of the manufacturing classes. fact but half employed, and half fed; And every rational man will admit, and of this diminished allowance of that the impoverishment of this great food, the farmers contrive to furnish and important class, occasioned by them with a considerable portion out Mr Peel's currency measures, is the of the poor rates. By this expedient, leading cause, not only of the distress ruinous to the morals and comforts which has been so long and so seof the peasantry, they succeed to a verely felt among themselves, but alcertain extent in forcing the inactive so of the overwhelming misery which, capitalist to disgorge a part of the sur from the want of their old and steady plus income which he has acquired customers and employers, has at through the alteration of the currency. length reached the manufacturers This is the true history of the origin and artisans of the empire. If the of the intolerable misery which now misery which now prevails in most universally prevails among the great of our manufacturing districts were body of labourers in agriculture detailed in but half its intensity and Thousands upon thousands of this horrors, it would, we are quite sure, unfortunate class are discarded du- appal the stoutest heart. Without ring the whole of the winter months; the most irrefragable evidence, the they are then lodged in public work scenes of suffering which arrest the houses, where they are furnished with attention of the traveller at every clean straw to lie upon, and with a step of his progress throughout those weekly allowance out of the parish districts, would appear perfectly infunds, just sufficient to supply them credible. with potatoes and salt.
In order to be restored to their The recent falling off in the amount wonted prosperity, the classes enof the public revenue, affords the gaged in the cultivation of the soil most decisive proof, that the enjoy- ask for no partial advantages; they do ments and comforts of the great bo not require to be enriched at the exdy of the people have materially di- pense of others; they solicit no favour; minished ; and to us it appears in a they simply demand justice. They still more alarming light, from the call for the repeal of the suicidal meaprospect which it holds out with re
sure, which, for the second time since spect to the future.
It not only the close of the last war, has placed proves, that the consumption of tax the whole of their property within able commodities bas decreased, from the grasp of the tribe of money lendthe poverty of the population; but it ers. They are willing to fulfil, in the seems to indicate a fact still more to most faithful manner, all the engagebe deprecated in its consequences, ments into which they have entered, -that from want of means to conti - to liquidate all their obligations in nue the energy of tillage, the pro a currency, equal in value to that in ductive powers of the soil of this which they were originally contractcountryhave received a serious check. ed; but they protest against the unThis furnishes the most incontrover- just operation of the recent change tible evidence of a decay, not mere in the currency, which has, to all inly in a minor branch of public indus tents and purposes, had the effect of try, but in the trunk or root which adding 25 per cent to the real value feeds and nourishes all the branches. of all debts. It behoves Government, therefore, Having thus pointed out the injusto turn their most serious attention
tice of the recent change which has to the present condition of the agri- taken place in our monetary system, cultural classes; for, if we should as as it affects the interest of individuals, sume it to be true, that they are ut- and its impolicy, as it regards the terly regardless of the well-doing of public, we shall proceed to consider this numerous class of subjects on the practicability of establishing a their own account, still we beg to small note circulation, not liable to press the matter upon their conside- become depreciated or enhanced by ration, for the sake of the other fluctuation on the one hand, or to classes which depend upon the agri- expose its holders to loss through culturalists for employment and for the failure of Banks on the other. bread. It is needless to dwell upon That an unlimited circulation of the well known fact, that the agricul small notes may take place, consis, tural body constitute the best cus- tently with the perfect security of the
holder, is a fact which has been put should never invest with this privito the test of experience in this part lege, a private banker, or company of of the United Empire, for a period bankers, who cannot furnish a secuof no inconsiderable duration. And rity which places their solvency bethis is perhaps sufficient of itself to yond all doubt, as far as regards the convince our Southern neighbours, amount of notes issued by them. It that the insecurity of that species of is, therefore, our opinion, that no circulation among themselves, did banking establishment should be alnot arise from any thing necessarily lowed to circulate notes of any kind, inherent in its nature, but from some before it has given indisputable secuerror or imperfection in the system rity of its ability to meet the whole on which bank notes were allowed of its issues. We would, therefore, to be issued. The inconveniences have the Treasury exact from every and evils which formed the pretence Bank, a deposit of stock, or some for suppressing the one pound note other equally valid security, as an currency altogether,arose solely from indispensable condition to the grant the oversight of Government, in per- of a license to issue paper notes,-or mitting all Country Banks, without this object, perhaps, might be attaincheck or discrimination, to issue one ed, by giving the holders of notes pound notes. That more mischief did precedence over all other creditors, not flow from this strange oversight, when any bank should happen to fail. is, indeed, to us a matter of consider- The shadow of a doubt should never able surprise. It proves, that the be allowed to remain upon the pubgreat body of Country Bankers was lic mind, that any establishment, incomposed of solvent and responsible trusted by Government with the pripersons, and did not contain many vilege of circulating bank notes, speculating members trading solely could, by possibility, fail to liquidate on credit.
the whole mass of debts of that kind, We conceive, indeed, that in the which it may have contracted. We regulation of a paper currency, the think it would be but fair and honest, Government should perform a part that if at any time the officers of Gotowards the public analogous to its vernment, either from mistake or nefunctions, in regard to a metallic glect, should happen to take a secucirculating medium. As it allows nority which, when brought to the test, piece of metal to circulate as coin, proved insufficient, still the Treasury without being first assured, that it is ought to make good the loss sustainof standard weight and fineness, we ed by the holders of the notes. It is think it should not allow bank notes, the duty of Government to protect either for one pound, or any other tbe community against every species amount, to circulate as cash, before it of imposition or loss from the circuhas obtained an absolute, an instant- lating medium; and if at any time it ly available assurance of the perfect should extend the discharge of this solvency of the issuers. The issuing function to incompetent or insolvent of paper notes appears
in every re- subjects, it ought, in all fairness, to spect analogous to the act of coining be held responsible, both for the inmoney. This is properly the func- aptitude and inability of its delegates. tion of Government; and it never The practice of Scotland shews should be delegated to any party, of that even without taking security for whose integrity and responsibility the amount of notes circulated by a Government is not well assured. private firm, a system of banking may The issuing of bank notes of any be established, which practically seamount, does not fall necessarily into cures the public against all risk on the province of a banker. It may account of insolvency. We need not be profitable to the bankers them- inform our readers that our banking selves, and perhaps convenient to the transactions are chiefly conducted by public, that a certain number of this joint stock companies; the capital class of traders should be authorised invested in their concerns is raised to furnish each district with this spe- by a certain number of shares which cies of circulating medium; but we are generally held by a great number think that, not only as a matter of of partners. The National Bank of right, but also as a matter of duty to- Scotland has 1238 partners ; the wards the public, the Government Commercial Bank 521; the Aber
deen Town and County Bank 446; vague notion that a metallic circulaof the remaining banks there are ting medium is less apt to foster exthree in which the number of part- cessive speculation and overtrading ners exceeds 100; six in which the than paper money. This is maninumber is between 20 and 100; and festly an error, In periods of confiseventeen in which the number falls dence and commercial prosperity all short of 20. All these shareholders persons in trade have recourse to the are, severally and jointly, responsible extensive use of private paper, such to the public, not only to the full ex as bills of exchange and promissory tent of their respective subscriptions, notes; and by multiplying these, they but to the full amount of their en are able to carry overtrading and tire fortunes. All these Banks have speculating upon credit to as great branches in the different districts an extent as they please. A very amounting to about 133 in number; large proportion of the whole circuthese branches are managed by local lation of Lancashire consists of bills agents, who give security to the pa- of exchange of a small amount; that rent institution proportioned to the is to say, from L.10 up to L.50. trust reposed in them. This system These pass from hand to hand like has completely superseded the use bank notes; they become so fully of gold as a circulating medium; for indorsed before their maturity, that the last fifty years all pecuniary it is hardly possible to add another transactions in Scotland have been
“ What occurred at Hamcarried on in the paper issues of these burgh,” says Mr Tooke," at the close establishments; since the repeal of of last century, is a proof that even a the Bank Restriction Act, the public purely metallic currency admits of a may, if they choose, convert their large superstructure of private crenotes into sovereigns; but it is found dit, which may be subject to sudden in practice, that the public, having contraction and extension. The Bank the fullest reliance upon the solvency of that city presents an example of of these institutions, never ask for the most correct regulation of a megold. They habitually and univer- tallic currency that has hitherto been sally give the preference to paper. known. There is no paper whatever This immediate convertibility of pa current as money; yet under circumper into gold at the will of the holder, stances, favourable to speculation, effectually prevents these securities there was a very great increase of its from sustaining any depreciation, and general circulation through the mepreserves the circulating medium at dium of private paper and of transan uniform value. The panics and actions on credit in the year 1797 and alarms which in 1793, 1816, and 1825, 1798.” From circumstances of temruined so many Banks, and inflicted porary operation, there happened such severe losses upon the public about that time to be a scanty supply in England, passed over the banking of commodities, especially of colonial establishments of Scotland without produce imported into Hamburgb. in the slightest degree affecting their This caused an increased demand for credit. It is indeed a well-known immediate consumption, “ whence fact, that during a period of one hun arose a speculation which was cardred and thirty years, although pa- ried to a considerable extent, and per money has entirely superseded maintained, in a great part, by a cirthe use of coin, as a circulating me culation of paper; prices of colonial dium, only two Banks have failed in produce were driven up immoderthis country, and the whole of the ately, and those who had embarked loss sustained by the public, from the earliest appeared to be making large failure, amounts to no more than fortunes, and were thus for a time L.36,344. This proves, beyond all in high credit.” This overtrading in question, that the losses which have colonial produce was followed by its been from time to time experienced usual consequences--an over-supply. in England from the failure of Banks, of commodities, and a great fall of arose not from the circulation of pa- prices. The inevitable result was a per money, but from a defect in the destruction of the paper which had system on which it was allowed to been created there, and which had be issued.
extended itself, along with the speSome persons seem to entertain a culation, to other towns of Germany