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ing three times in the pillory; this, he said, ought to be tried. It Was generally allowed, that excessive punishments often occasioned impunity, and encouraged offenders; whence it might truly be said, that rigorous penalties promoted crimes: he therefore conjured the house not to add another to the severe penalties on the statute-books, till they were convinced of the inefficiency of the present laws.

Mr. W. Smith coincided with the concluding observations of Mr. Hobhouse, and thought the existing laws sufficient.

The speaker having left the chair, the chancellor of the exchequer proposed to the committee to insert these words: "Such persons shall be judged guilty of felony, and shall suffer death as in cases of felony, without benefit of clergy." If the committee should agree to this, he should then propose to limit the duration of the bill to one month after the commencement of the next session of parliament. He concluded by moving the insertion of these words: "maliciously and advisedly to commit any act of mutiny or treason, or to make, or endeavour to make, any mutinous or traitorous assemblies, or to commit any mutinous or traitorous acts whatever."

Mr. Tierney thought the existing laws of high treason rendered the bill unnecessary; but as it was to be in force only for a few months, he should give it no further opposition.

The bill was read a third time, and passed rum. con.

On the same day, the chancellor of the exchequer introduced into the commons a bill to restrain the intercourse with certain ships, then in a state of mutiny.

On the 5th of June, when it was proposed to fill up the penal clause,

and to enact that the punishment for wilful and advised communication with the ships' crews declared to be in a state of mutiny should be death, as in cases of felony, without benefit of clergy; Mr. Nichols said, he thought that the punishment «of death would in some cases be too severe; and that maKing it. a misdemeanour, liable to transportation, would be sufficient. Mr. serjeant Adair said, that the penalty was only to attach to those who should hold intercourse and communication after the publication of the declaration that the men were in a state of mutiny, and of the prohibition to hold intercourse with them: the provisions in the bill were in their very nature temporary, and ceased with the causes by which they were produced.

Sir Francis Burdett opposed the bill. He said, that the house had but the assertion of ministers that such a measure was necessary: he thought it tended to put the seamen in a state of desperation; and the mischief which they might do this country in that state was dreadful. The discontent was not confined to the seamen; there was much of it in other quarters; and it was visible in many parts of this country. The very strong laws which were made to repress these discontents, or rather the expression of them, were symptoms of great disease, of which there was a cause very different from that which had been stated. That cause was the misconduct of administration for a long time, but particularly for the last four years, and the enormous corruption of the executive government: these were the real causes of the evil. The bill, however, was passed through all its stages on the same day. On the tith of June the two bills relative

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Critical Situation of the Bank of England. Extraordinary Demand for Specie. Order of Council prohibiting the Issue of any more Specie from the Bank. Supposed Causes of the Run on the Bank, and of its Incapacity for answering the Demands. Message from his Majesty to both Houses of Parliament relative to the Order of Council. Debates in the House if Lords on that Communication. Debates in the same House on his Majesty's Message. Committee appointed to inquire into the Affairs of the Bank. Committee to inquire into the Necessity for the Order of Council. Report of the Committee. Debates on the Subject. Resolutions proposed hy the Duke of Bedford negatived. Debates in the House of Commons on his Majesty's Message. Committee appointed by the Commons for an Inquiry into the Affairs of the Bank. Motion by Mr. Fox to inquire into the Causes of the Order of Council negatived. Bill to enable the Bank to issue small Notes. Report of the Secret Committee on the Bank. Committee revived. Small-Note Bill, for accommodating Traders and Manufacturers. Motion by Mr. Shtridan on the Affairs of the Bank. Bank Indemnity Bill. Reflections on the present State of the Bank.

WHILE the tranquillity of the nation was disturbed, and its existence endangered by the mutinous disposition of its most effective defenders, an evil which at first appeared of scarcely inferior magnitude, threatened at once to overwhelm its financial arrangements, and to bury in one prodigious ruin the pecuniary resources, and even the commerce of the country. By the continued sanction of public opinion, the Bank of England had been long considered as the palladium of Britain; and the confidence which was attached to this object of national veneration approached, it must be confessed, to the nature of idolatry. Like other popular superstitions, its proceedings were enveloped in mystery; its existence was connected in idea with the existence of the state; its influence on the commercial prosperity of the country was highly exagge

rated; and its importance in every point of view was magnified by the operations of fancy on the basis of ignorance.

The year 1797, which has been more productive of political wonders than any given period during the present century, has added this to the number, that the Bank of England has failed to fulfil its engagements, and yet public credit has remained unshaken. At the same time the veil of mystery which concealed its proceedings from the public is rent in pieces; its powers and its competency are now no longer secret; and that confidence which before rested on an ideal basis, is now supported by legislative sanction, and by a developement of the affairs of this great monied corporation.

The rise and progress of papercurrency, and of banks of deposit in Europe, is a subject deeply interest

Ing to the politician; but it has ne-
ver been treated with that accuracy
of research, and that freedom of in-
quiry which its importance deserves.
If we are not mistaken, the bank of
Venice is the oldest of these institu-
tions, for it was established so early
as the twelfth century, by an act of
the state, as a general deposit or trea-
sury for all the merchants and traders
of that opulent and commercial city.
Hie banks of Genoa, Hamburgh,
Nuremburg, and Amsterdam, were
all, we apprehend, of a date consi-
derably anterior to that of the bank
of England; but that of Amsterdam,
which was established in 160§, was
the most important of them all, and
its circulation the most extensive.
Its object was to contract the
abuses arising from the clipping and
diminishing of the various coins
which were then current in Holland.
It therefore received both the light
foreign coin, and the diminished
coin of the country, as its real and
intrinsic value, in good standard mo-
ney, deducting only the sum neces-
sary for its recoinage; and for the
sum deposited after this deduction a
credit was opened with the proprie-
tor in the books of the bank, and
the revenues of the city of Amster-
dam were made responsible for the
amount.' The bills of credit upon
the batik thus came to be distinguish-
ed by the name of bank money; and
effectually to remedy the evils aris-
ing from the defacing of the coin, it
was enacted, that all bills of ex-
change of the value of 600 guilders
or upwards were to be paid in bank
money, which, as it represented mo-
ney, exactly according to the stand-
ard, was always at par, or of equal
value with good standard currency.
Certain other objects of no inconsi-
derable moment to commercial men
were achieved by means of this esta-
blishment. The money thus depo-


sited wag secure from fire, robbery, and other accidents; and large sums could be paid by a simple transfer, without the trouble of counting, or the risk of counterfeit coin.

In England, after the fatal contests between the houses of York and Lancaster were composed, the opulent citizens were accustomed to deposit their gold and silver in the royal mint as a place of safety, whence they occasionally drew supplies of current coin, as their necessities required; but when the unfortunate Charles I. seized the bullion in the Tower, in the year lb'40, this sanctuary was violated, and all confidence in the government was at an end. In the course of the civil war, that unnatural state of commotion, which corrupts and depraves even the best of the human race, rendered it unsafe to the merchants and traders to trust their clerks, or apprentices, with the charge of their treasure; and about the year 1045 they began first to lodge their money in the hands of certain goldsmiths, who undertook to be answerable for their payments upon drafts, under the signature of the respective principals: and this appears to be the first establishment of regular banks in the city of London. The institution of a bank upon more extensive and liberal principles was projected by some merchants and traders of the city of London, soon after the revolution, and was countenanced by the court and ministry; and though, as bishop Burnet informs us, the opposition to its establishment was considerable, an act was nevertheless passed in iGQ'i for its incorporation, under the name of the Governors and Co. of the Bank of England. The establishment was formed partly on the constitution of the bank of Amsterdam., and partly on the practice of


the private bankers in England. It was an immense trading company, which dealt in bullion, discounted bills of exchange, advanced money on security to individuals, and occasionally to the government. Its advances to the latter became at length so considerable, as to absorb the whole capital with occasional augmentations, as will appear from the ensuing debates. • Its connexion with the government, and the advances of money to the support of every war, rendered it the policy of the ministers, as well as of the bank directors, to involve in mystery as much as possible its proceedings. Some spirited, and, we must add, patriotic efforts, were, however, made by the late alderman Picket, to oblige the directors to lay their accounts, annually, before the public; and we must remark (so essential is publicity to the welfare of every national institution) that if bis applications had been successful, the bank would probably never have experienced the shock which we have now to record.

In the course of the present war, the remittances to the emperor and other fpreign'powers pressed so heavily on the bank of England, that, so early as the month of January 17p4, the court of directors informed the chancellor of the exchequer, that it was their wish, "that he would arrange his finances for the year, in such a manner as not to depend on any furtlier assistance frum them." These remonstrances were renewed in the months of April and July, in the*same year; and on the 8th of October following, they sent a written paper to the minister, which concluded by stating "the absolute necessity which they conceive to exist, for diminishing the sum of their present advances to government; the last having been granted with great reluctance, on

their part, on hit pressing solicit*' tions." In an interview with the chancellorof the exchequer; which took place on the '23d of the same month, on the loans to the emperor being mentioned, the governor assured Mr. Pitt, "that another loan of that sort would go nigh to ruin the country;" and on the 9th of February 1797, the director* ordered the governor to inform the minister, "that under the present state of the bank's advances to government here, to agree with his request of making a farther advance of 1,500,000/. as a loan to Ireland would threaten ruin to the bank, and most probably bring the directors to shut up their doors."

With this cause, another \w supposed by some to have powerfully co-operated to the late event, and that was the dread of an invasion, which had induced the farmers and others resident in the parts distant from the metropolis to withdraw their money from the hands of those bankers with whom it was deposited. The run, therefore.(to speak in the technical language of the moneymarket) commenced upon the country banks, and the demand for specie soon reached the metropolis. Jn tht9 alarming state the ministry thought themselves compelled to interfere, and an order of the privy council was issued on the 26th of February, prohibiting the directors of the bank from " issuing any cash in payment till the sense of parliament can be taken on that subject, and the proper measures adopted thereupon for maintaining the means or circulation, and supporting the public and commercial credit of the kingdom at this important conjuncture." • ■"

As the parliament was fortunately sitting at this critical moment, no time was to be lost in laying these proceeding* before it. On the fol

lowing day, therefore, the 27th of February, a message was delivered from his majesty to both' houses of parliament, stating, "That an unusual demand of specie having been made from different parts of the country on the metropolis, it had been found necessary to make an order of council to the directors of the bank, prohibiting the issue of any cash in payment till the sense of parliament could be taken on the subject." The order of council was read along with his majesty's message; and lord Grenville, in the house of lords, rose to move, "that the communication from his majesty should be taken into consideration on the following day."

The duke of Norfolk observed, that as the message was so soon to be taken into consideration, he should not then enter much into the subject. The cause in which the order originated must have given serious alarm to their lordships and the public. The bank was ordered to refuse payment of their own bills in the possession of individuals, who considered them as properly.

His grace thought, that thedesperate exigency to which ministers had driven the country was owing to the exportation of specie to the emperor of Germany and our other allies upon the continent: and on this account he moved, *' that an humble address be presented to his majesty, to prevent the further exportation of specie until the sense of parliament be taken on that subject."

Lord Grenville said, as their lordships had determined not to take the subject into consideration till the next day, he did not wish to discuss it, as neither he nor the house were prepared for it.

The duke of Norfolk, on the contrary, urged the necessity of deciding upon it that day.

The earl of Guilford said, he did not rise with any intention to discuss this subject, as it was determined for the next day, though he thought it required immediate consideration. His lordship added, that, considering the glaring incapacity and ill conduct of his majesty's ministers in the course of the war, he thought some strong measure should be adopted for the support of public credit. He contended, that ministers ought to have been aware of the necessity to which they had reduced the country, and not have suffered themselves to be taken by surprise, and driven, as it were, to a step so alarming, as to require the bank to stop payment of their own notes.

His lordship said, it was very extraordinary, that the impulse should be so sudden, as to cause such a violent measure to be adopted, without consulting parliament. Parliament had been sitting the whole of the last fortnight, and not a single word had been dropt on the subject. Not being aware of the reasons which prompted ministers on a sudden to adopt a measure so extraordinary, he could not argue on its expediency or its necessity; but thought the conduct of his majesty's ministers gave room for suspicion, and rendered his noble friend's motion highly proper. Lord Romney remarked, that in the present momentous situation of the country, every thing which had the appearance of suspicion ought to be removed, a3 it must have a dangerous tendency without doors. The words "extraordinary and illegal," which were in his noble friend's motion, he observed, amounted to a very strong insinuation that the necessary step to be taken was occasioned by the misconduct of ministers. His lordship said, if there were any ground for such an insinuation, no man would be more eager


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