The Chancellor of the Exchequer
rose and said, that in submitting to the consideration of the Committee of the whole House the result of the inquiries of the Select Committee, appointed to investigate the present state of commercial credit, and in avowing the intention of proposing to the Committee to adopt the measure recommended by the Select Committee, he thought it necessary to state, that he had made up his mind to express his opinion with great reluctance, and not till after very serious consideration. He admitted that parliament was not bound, nay he contended that parliament ought not to be called upon to interfere for the purpose of providing against any misfortunes to which incautious adventurers might have exposed themselves; because he conceived that, reasoning on general principles, such an unqualified interference would have a tendency, by relieving the apprehensions of individuals with respect to the result of commercial speculations in which they might have engaged, to diminish the caution so necessary on these subjects, and which was the best check to rash and ill-advised adventures. But while he stated this as a general principle, he yet apprehended that there might be many great exceptions to the rule; and that the question must always be as to the merits of the particular case. Of this he was at least persuaded, that those hon. gentlemen who agreed with him, that a similar interference of parliament in 1793 was wise and necessary, could not now broadly deny in toto the expediency of such an inference. They might argue that the interference, though expedient and proper in 1790, was not fitting at present. But they could not assert that all interference was improper at any time. The question, he repeated, must depend upon the circumstances of the particular case; and in this view he conceived that the report of the Select Committee afforded sufficient grounds for the motion with which he should conclude.
The consideration of this important subject, he observed, divided itself into three heads:—First, the nature and extent of the evils which the manufactures and commerce of the country were enduring;—Secondly, what were the causes of those evils;—And thirdly, the measures by which the evils might with the greatest probability be removed.—With respect to the first of these considerations, he apprehended 329 there could be no difference of opinion whatever, but that the nature and extent of the distress, described in the report of the Select Committee, rendered it advisable that parliament should, if possible, adopt some measure by which that evil might at least be diminished. It appeared distinctly by the report, that the distress, originating with the merchant, and disabling him from paying the manufacturer, was felt most severely by the manufacturer, and those employed by him. All the principal manufacturers had been compelled to contract, and some wholly to suspend their works. It appeared by the report, that there was scarcely a cotton manufacturer in the kingdom who had not diminished, by one half, the number of persons employed in his mills; and that many of the smaller manufacturers had discharged their people altogether. It appeared also, that those who were retained by the first description of manufacturers, were retained at a reduced rate of wages. The consequences must necessarily be, as they were represented to be in the report of the Select Committee, that the most calamitous distress prevailed throughout many of the manufacturing districts. The report also stated, that the merchants who traded with the Western world not being able to find an adequate market for their produce, this circumstance aggravated the distress of the manufacturers; and the whole operating upon the other branches of trade, although not immediately connected with those to which he had referred, produced a general want of confidence, and suspension of credit, which required the prompt and effectual application of some adequate remedy.
Thus much he felt it necessary to premise as to the extent of the evil. With respect to the second consideration, namely, the causes that produced it, it appeared pretty plainly that the whole had originated from over-extensive speculation to the ports of South America. These speculations in the export of merchandise failed in meeting a ready market; and in many cases the commodities brought back in exchange could not be disposed of, owing to the market being overstocked at home. Such were the causes of the evil. It came next then to be considered whether the distress was of such an extent, and was attributable to such causes, as to make it wise and prudent for parliament to afford assistance. It might be observed generally upon this 330 12,835,803l.; in the year ending the 5th part of the question, that the origin of the existing distresses—over-speculation, was not a good ground for such a measure. He would not dwell minutely on the demerit of that rash and inconsiderate conduct which had precipitated those who pursued it into misfortune; 'but gentlemen would bear in mind that on the opening of the South American markets in the Brazils and elsewhere, to the adventures of British merchants, it could scarcely be with any justice complained of that they did not in the first instance foresee the exact result of their too extensive speculations. But whatever might, be the merit or demerit of those individuals, the consequences of their conduct had been severely felt by them. Parliament, even if disposed to be vindictive, could not abstain from granting relief to those persons, on the supposition that they had not suffered sufficiently for their errors. But it was not to them that the proposed relief would extend. "They," to use the words of one of the witnesses, whose evidence was contained in the report of the Select Committee, "had gone to bankruptcy long ago." It was to the evil endured by those upon whom the conduct of the original speculators operated, that the Select Committee recommended the application of a remedy.
It now, therefore, only remained for him to consider, thirdly, whether the measure suggested in the report was calculated to remedy the existing and acknowledged evil. And he had no difficulty in admitting that there were many circumstances which marked a considerable difference between the present case and that of 1793. In 1793, the continental markets were not wholly shut; they were only interrupted. The stagnation of trade was then purely temporary. Credit had, at that period, received a check, but it was a check which a little time would restore. At present the markets from which relief might be derived were twofold: South America for the disposal of our manufactures, and the European market for that of our foreign produce. The markets in the Western world had been stopped by a glut. A glut, however, was but a temporary suspension of demand. There was no difficulty in the access to those markets; the only difficulty was in finding purchasers for the British manufactures exported thither; and he trusted that at 331 no very distant period this difficulty would be removed. With respect to the markets of Europe, they were at the present moment closed against us by edicts of the greatest rigour. But experience had universally shewn that, after the adoption of commercial restrictions of great rigour, although they may be severely felt for a time, yet a practical relaxation soon ensaed. For his own part, he had no doubt that the ingenuity and exertions of the merchants, and the wants of the consumers, would ultimately find means to obviate, in a great degree, the difficulties and disadvantages at present existing. Therefore, although the present case was not exactly parallel to that of 1793, yet no man could say that there was not a prospect, that, in twelve months at least, commerce might experience some advantageous change.
Yet even were this change but barely possible, instead of being probable, in his opinion the measure proposed by the Select Committee ought to be adopted. Parliament ought at least to make the attempt to relieve the distress. No one could say that the attempt may not be completely successful. The worst that could happen was, that it would leave the commerce of the country, at the expiration of the twelvemonth, in no better a state than that in which it was at present. He contended, therefore, that as it could not make the state of commerce worse, but might make it much better, Parliament were bound to try the measure recommended to them. To meliorate the state of commerce, if not wholly to restore it, would be an advantage. The increasing consumption of the domestic markets, the opening of the markets of the Western world, would afford some relief; and when to this was added that further opening which might result from the chances of war, the whole afforded, in his opinion, a sufficient justification of the proposed effort. The justice of this reasoning would be confirmed by a consideration of the nature of the existing grievances, as particularly connected with the cotton manufacture. The rapid growth of this manufacture, up to the period when the distress began to be strongly felt, was really extraordinary. It appeared by the report of the Committee, that the official value of cotton manufactures exported from Great Britain, in the year ending the 5th of January, 1808, was 9,846,889l.; in the year ending the 5th of January, 1809, 332 of January, 1810, 18,616,723l.; and in the three quarters ending the 10th of October, 1810, 13,761,136l. It thus appeared that the exports were doubled in two years, and that the trade was suddenly checked when at its very acme. The immediate revulsion which such a check would occasion, must necessarily be felt with the greatest severity. If time then were allowed the merchants and manufacturers to bring themselves round, the evil would be materially diminished. It was to this object that the proposed measure was directed. It went to give the merchants and traders an opportunity of applying to other resources, and to spread over a larger period of time that pressure of distress, which, if confined to a single moment, must overwhelm those who were its victims.
He had now, in his apprehension, said enough to satisfy the Committee that although the present case differed in some respects from that of 1793, there was a sufficient resemblance to warrant him in recommending the adoption of a proposition at the present period similar to that adopted in 1793. In doing this, however, regard must be had to the circumstance, that the extent of the trade on which the present distress operated was much greater than in 1793. If the Committee, therefore, desired to make the measure effectual, if they wished not to starve it by a stinted vote, they would agree to the recommendation of the Select Committee, that the relief afforded should be six millions, instead of five. The Commissioners appointed in 1793, although empowered to grant relief to the extent of five millions, did not actually issue more than two millions two hundred thousand pounds. On a similar principle, he should propose to empower the Commissioners in the present instance, to grant relief to the extent of six millions, not with the supposition that that sum would be required, but that relief being open to such an extent, the credit of those who were suffering might be sustained without, and themselves rendered able to go on with much less perhaps than would otherwise be necessary. The regulations and restrictions which accompanied the measure of 1793, were those which he should propose to the House for adoption at present; with this exception, that, from the nature of the case, he would recommend the periods of repayment should be placed at a greater distance of lime from 333 each other. The regulation which he should introduce into the Bill (should the House allow him to bring it in) would be, to make the first quarter's instalment payable about the middle of January, and the remaining instalments payable three months after each other, until the whole should be repaid, thus following the mode recommended in the Report. It did not appear to him necessary to intrude further on the Committee than by moving, "That it is the opinion of this Committee, that his Majesty be enabled to direct Exchequer Bills, to the amount of six millions, to be issued to Commissioners, to be by them advanced, under certain regulations and restrictions, for the assistance and accommodation of such persons as shall be desirous of receiving the same, on due security being given for the re-payment of the sums so advanced within a time to be limited."
then rose and said, that, in the observations which he felt it his duty to make upon the statement of the right hon. gent., he wished to be understood as having no intention so to oppose the motion with which he had concluded, as to press the question to a division by taking the sense of the House upon it. The right hon. gent. himself had, he observed, admitted that the circumstances of the present period were not similar to those which characterised the distresses felt by the commercial world in the year 1793. In his opinion there was no similarity whatever between them. In the former period the continent of Europe, instead of being hostile to us, was, with the exception of France, not only friendly, but the greater part of it was in alliance with us, and France not only wanted the influence she now possessed and exercised over the surrounding nations, but she was unable to prevent their armies taking the field against her interests. At present, on the contrary, so far from the nations of the continent being friendly, we were altogether shut out from every amicable communication—from all commercial intercourse. The right hon. gent. had said, those who had entered into the early and largest speculations with respect to South America, had been punished for their rashness by bankruptcy, and that those now to be relieved were the victims of those speculations, and not the partners in the crime. For his part, he thought (whatever blame might be attempted to be thrown on those who had been most 334 venturesome) that the origin of the evil might be traced to the exaggerations, the falsehoods, and the misrepresentations which had been heard in that House. South America had been spoken of by the right hon. gent. and his friends as affording a market that would take all our merchandize, and that he looked upon as the great cause of the recent failures, and of the evils of which the mercantile world at present complained. The right hon. gent, had said the present state of things was to be considered as but temporary, though it might be of longer duration than the stagnation felt in 1793; and under these circumstances, he thought the same measure ought to be resorted to as had been adopted on that occasion. He could not agree with this. Was the market of South America glutted at pre sent? Had that country at present more of our merchandize than was sufficient for the consumption of one year? If that were the case, the British manufacturers must stand still till the stock shall be consumed. He could not tell to what amount that country might be stocked with the produce of our industry, but when 6,000,000l. were thus called for, he thought they had a right to conclude that things were in such a situation, that with out such assistance they could not right themselves in less than one, two, or per haps three years. The right hon. gent. had talked of the great increase of the trade of the country, but upon this point he appeared to labour under a mistake. Exports were not trade; but he had; spoken of them as if their amount was a sufficient proof of the flourishing state of our commerce. If we made extra ex ports, we ought to have returns; and if, in stead of this, what we sent out lay locked up in South America for two or three years, it was not thence to be inferred, that because our exports were large, our trade must be great. If men of adventurous and speculating dispositions were to carry their exports to an extreme, were the rest of the community to be called on to enable such men to persevere in their speculations, in fact, to enable them to give further credit until at length their returns may be received? This was-a species of relief which he, for one, could never consent to afford to those who had brought their distresses upon themselves by improvident speculations.
The right hon. gent: had ascribed the present stagnation of trade and the die 335 tresses of the mercantile body to the state of the markets of South America principally. In this, however, he could not concur. The state of the European markets, on the contrary, appeared to him to be more immediately the operating cause, and what prospect of a change in them within any reasonable time could the right hon. gent, now Bold out? It had been said, that after a glut a brisk demand was to be expected, and a stagnation of trade was usually succeeded by a most advantageous change. He was aware that it had been so hitherto, but it had been so from events which were not such as were likely to occur again. The last time the French seriously directed their attention to the annihilation of our trade, they had been called from the borders of the ocean by the Austrian war. The Spanish contest had made a new diversion in favour of our commerce, but what prospect was there that such events would again take place? They had formerly been told by the right hon. gent, that the edicts of France had shut the markets of the continent against us, but that he (the Chancellor of the Exchequer) had found out an instrument which would soon open them again, and restore the trade of the nation. He then brought forward his Orders of Council, which had been sanctioned by Parliament. He would now ask the right hon. gent. if they had produced that effect, or if there were any probability of their accomplishing, within a short time, the object he had had in view? From the present restricted state of our intercourse, our colonies were rather burdensome than profitable, as their produce was locked up here, in consequence of our being unable to find a market for it on the continent. For the same reason, the conquest of the enemies colonies tended to increase the distress, because while France had colonies, she did not interdict colonial produce altogether, and much English colonial produce found its way to the continent with the produce of the French islands. From the moment France lost all her West Indian possessions, she could have no interest in allowing of such importations, and they were in consequence more strictly excluded than before.
It had been urged by the right hon. gent. in support of the measure he recommended, that, as it could do no mischief, it was worth a trial; and that if no harm was to be apprehended, whilst much good might follow from its operation, it was the 336 duty of Parliament to adopt it. But for his own part, he could not consider the experiment so perfectly harmless, or the measure so obviously safe thought it might possibly do good, and he wished it might; but it appeared to him impossible to return to that state from which they had been unfortunately led by their folly, in a way so very easy and free from danger. That spirit of enterprize which had led to such fatal consequences ought to be discouraged, that something like a stop should be put to such wild and unprofitable speculations. The right hon. gent, had told them that the money to be advanced would not in all probability be lost to the public. He did him (the Chancellor of the Exchequer) the justice to believe he would endeavour to name such Commissioners on the occasion as would do their duty, and look well to the application of the money; but when the House were called upon for 6,000,000l. in Exchequer bills, just after they had funded 12,000,000l. and when they reflected that all the circulating medium at present in the country was paper, it was their duty to consider how far they ought to countenance such extensive issues of paper money. He thought it was their first duty to narrow, as far as might be, the circulation of paper. Whether or not they had now reached that period at which it would be proper to put an end to it altogether, and restore the proper circulating medium, was a question on which he would not venture to decide, but he thought they ought to do something towards putting a stop to the extension, at least, of the paper circulation. It was a painful task to refuse solicited relief to sufferers, who suffered not for their own misconduct, but for the imprudence of others.—Feeling this, he would not take the sense of the House on the subject, but having made these few observations which he had thought it his duty to make, he should abstain from further opposition to the measure proposed. Doing this, he might not act strictly up to his duty, as he thought the principle of a tendency rather to do harm than good; but under such circumstances as the present, he had not resolution enough to oppose that which afforded any thing like a chance of alleviating the distress of those who claimed their assistance.
§ Mr. Huskisson
said, it was not his intention, in what he should say, to question either the amount of the sum proposed by 337 the Report of the Committee, or the extent of the hardship under which the manufacturer laboured. He begged it to be believed, that, in the observations he should have to make, nothing was farther from his mind than to bear hard on those who were affected by the present state of the commercial credit of the country, particularly on the manufacturers, who were now, by the existing state of things, deprived of a market for their commodities. That class of persons was peculiarly entitled to the protection of Parliament, because from the situation in which they stood they could not have brought the calamity upon themselves by their imprudent and unjustifiable speculations, as they did but execute the orders they had received from the merchants, and were distressed in consequence of the latter being unable to make the proper returns. Notwithstanding the difficulties which must be felt on the subject, as well with respect to the efficacy of the plan, as on account of the inconveniences which might be expected to arise from it in a case where the necessity was so urgent, he would not in any way obstruct the measure in its progress. The difficulty which chiefly struck him, was in discovering in what respect the present period had any resemblance to the state of affairs in the year 1793. He also must own that he felt doubts, and only doubts, as to the efficacy of the measure proposed. If he felt more than doubts on this subject, he should oppose the proposition, but his difficulties being confined merely to doubts, which he should now state, it was not his intention to oppose the measure. He hoped his doubts might be removed, and if they went no farther than the objections stated by the right hon. gent. (Mr. Ponsonby), he should not now allude to them. The right hon. gent. had argued, that the state of commercial credit was not owing to a glut in the market of South America, but to the state of Europe. If he could be persuaded of this, he should not think the matter of so much importance. The successes of France had been progressive, and it naturally followed, that the trade to the continent should also have necessarily accommodated itself to those progressive successes and changes as they occurred; and so the evil must have been less severely felt, if it had not been for other changes. His doubts principally arose from an impression on his mind, that such a case had not been made out as had been proved in the year 1793. The present 338 Report was built principally on a theory of two respectable gentlemen, who said that great relief and also great good had been derived from the accommodation given in the year 1793. They agreed,' indeed, that there was a difference in the state of things at the two periods, but they did not state in what that difference consisted. The Report in the year 1793 laid it down, that the discredit under which paper then laboured had produced a deficiency in the circulating medium, and then went on to state, what, in the opinion of the Committee, would increase the quantity of that circulating medium. The stoppage of one banking-house had then occasioned a distrust of all. Within three months after that, with all the markets of the continent open to us, the markets and manufactories of England were in a state of total stagnation. The public securities were excessively depreciated, Exchequer bills and Navy bills were at 12 or 13 pet cent. discount, and it was impossible to gain discount for the most inconsiderable sum. Was that the case at present? Quite the contrary. Then there was a great deficiency and diminution of circulating medium. Was that the case now? Certainly not, but greatly the reverse. Public securities stood then at a discount. Now they bore a premium. At this moment there was no difficulty in procuring discount of bills with good names upon them. No later than that morning Navy bills were discounted at 4½ percent.—The Bank of England had now to complain, not that they had no funds with which to discount, but of a deficiency of good paper to discount. (Hear! hear! by Mr. Rose.) The right hon. gent, called hear! but if so, this was not the case in the year 1793. If he were to trace it back historically, the case of the year 1793 was as dissimilar from the present as could be in almost every respect. Then there was a fall, not on one commodity; but on every one. There was a rise in the value of money, and a fall on every other commodity whatever. It equally affected every person too, and was of short duration. There was then no want of market, there was no glut or stagnation of trade; but there was a want of individual confidence. Then there was a diminution of the circulating medium. Was that so now? Then the issues by the Bank of England were 14 millions, now they exceeded 23 millions. He wished gentlemen to consider the essential difference in the state of things 339 then and at the present moment. Now there was a demand in the country for good paper; and the Rank of England, so far from confining its discounts, has, in consequence of the want of good bills to discount, been purchasing largely of government securities. He wished the present Report had been more explicit.
The House, he observed, would recollect that in the year 1793, several gentlemen of the first character, members of that House, had been examined before the Committee, and stated that houses of known respectability could not, at that period, get money on good bills. At that time not one considerable house failed. He remembered well that there was hardly one house of those which stopped payment which did not afterwards pay in full, possessing more than the amount of all the claims made on the concern. The witnesses examined even had stated the manufacturers who had capitals to be the persons who felt the greatest distress. Under all the circumstances, the question then was, if the remedy resorted to in 1793 ought to be resorted to when the situation of things was different? The present Report, on the contrary, now went, as it were, to countenance the idea that there were manufacturers at present who had no capital at all. It staled, that such merchants could not obtain credit; as if it was to be considered a strange thing that there should be a want of credit where a merchant was not solvent. This was the difference between the Report in 1793, and that now before the House. He would not on this occasion anticipate what might be said on the subject—but he hoped that on some other occasion the House would not fail to discuss and inquire into this evil. The commercial and manufacturing classes were then straitened for want of a circulating medium; but were they so in this instance? At the present moment there was no deficiency of circulating medium, and if securities were unexceptionable they would not now he refused. There was not at present any want of facilities, but want of confidence. Let it be considered, that in the present state of matters the Bank of England, or any persons who advanced money, were partners in every speculation, to the extent of five per cent, without risk. Under these circumstances could it be surprising that there should be great readiness to give credit, and that it should be too greatly extended? In his opinion the great evil arose from too great 340 a facility of procuring credit. And here, without any thing injurious or offensive to the Very respectable individuals concerned, he could not help adverting to the sad catastrophe which had recently occurred in the city (the death of Mr. Goldsmid) to one of the contractors for the late loan, as a consequence of the facility of speculations to a large amount, beyond the means of the parties, and an illustration of his argument. Did gentlemen not see that the race of old English merchants, who never could persuade themselves to go beyond their capital, was superseded by a set of mad and extravagant speculators, who never stopped so long as they could get credit; and that persons of notoriously small capital had now eclipsed those of the greatest consequence; so that speculations now took place even in the lowest article of commerce? In this way had commerce become a sort of wholesale gambling, such as had never before been seen in this country. The state of our circulation was such as fully to justify these observations. In the present state of this country no good could be done by encouraging speculation. He wished that relief should be afforded to the manufacturers, but if any person could, on application, and giving personal security to the satisfaction of the commissioners, receive any part of the sum to be advanced, and, instead of applying it to relieve himself out of the particular embarrassment in which he is at present involved, engage it in general speculation, the only effect of the measure would be, to aggravate the evil which it was intended to remedy. Part of the sum so to be issued might even get into the hands of great speculators, who might use it for the purpose not of diminishing, but of increasing the risks to which they had been already exposed, in the hopes that they might thereby extricate themselves entirely. He saw nothing to secure us against overtrading, even with this sum so to be advanced, or that the relief would be actually given where it was due, and where it was really wanted. If so, the present measure would only go to add six millions to our circulation, and to raise the price of all our commodities. He wished his right hon. friend to consider if means might not be devised for confining the relief to those only who required it. If not, what security had we that a person obtaining part of this sum on credit might not employ it in speculating on the pubic 341 loan of the year? At a period such as the present, when there were such fluctuations in the markets, if the distribution of this relief was not properly looked into, there would be found gentlemen who would avail themselves of the measure to ground on it new and more hazardous speculations. When individual confidence was at the height, that formed a ground for an increase of the circulating medium; but when there was a glut of commodities in the market, such an increase was carefully to be guarded against. If not, we must goon from bad to worse, without ever getting at the root of the evil. Looking at the Report, therefore, he was at a loss to find what the parties meant by saying, that the country banks had no means of making any further advances to assist the manufacturers, as their property was already sunk in bad bills; while the merchants and manufacturers had their property sunk in exports to South America, for which they had had no return. These seemed to him rather as arguments against the conclusions come to in the Report, than in support of them. He had thus thrown out what occurred to him as doubts on this important subject, hoping that they might be removed in the course of the discussions, which the measure would not fail necessarily to receive in its future stages through the House.
stated, that the right hon. the Chancellor of the Exchequer had not recommended the proposed measure in a full confidence of its success; all that he had urged was the probability of such relief affording a reasonable chance of recovery from the present embarrassments of the commercial classes. His hon. friend (Mr. Huskisson) in stating the difference between the present period and that of 1793, particularly contended, that in the latter period credit was very high, and trade very encouraging, and that the pressure was but temporary. In that opinion it was his belief that his hon. friend had overstated the point, because he well recollected that many of the great houses then embarrassed, became in a short time bankrupt; indeed, in the neighbourhood of Bristol alone there were no less than six private banks which became insolvent. With respect to the objection which arose from the state of our paper circulation, he had directed his attention most particularly to that subject; and the result of his inquiry was, that, in place of a redundancy of paper, as the House would be 342 surprised to learn, the present circulation was much circumscribed. As to mercantile gambling, to which an allusion had been made, it might be that such a practice had partially taken place; and those who resorted to such an expedient had a right to smart under its consequences.—But it was no argument to advance, that, because some merchants went out of their way, therefore others, with fair claims on public liberality, were not to receive relief. That such relief would not be improperly dispensed, there was every probability, from the character and exertions of the commissioners; who no doubt would, as was their duty, take the most effectual care to obtain not only security, but the fullest satisfaction that the money should be reimbursed within the given period. Some allusion had been made by his hon. friend (Mr. Huskisson) to the contractors for the last loan. He (Mr. Rose) was not aware of any improper transaction attaching to the nature or circumstances of that contract—it might, have turned out disadvantageous to those who had made that bargain; but that was no uncommon occurrence; indeed there were instances of much more disadvantageous engagements of that de scription. His right hon. friend (Mr. Perceval) never did say that no returns were made from South America: but he contended, that when our merchants took returns in the produce of that country, such as coffee and sugar, it was impossible for them to know that the markets of Europe were shut against them. When, in October last, the first application was made to him for the relief now proposed to be granted, he (Mr. Rose) was much indisposed to accede to it; the general principle was against it; but upon a more detailed examination of the circumstances, he was induced, from the numerous statements of great distress, particularly in the manufacturing districts, to support such a proposition. He denied most strongly that any merchant would be induced to risk adventures from mere statements made in that House. He had himself, in his place, expressed a hope that the markets of South America would afford great scope for British speculation, and that hope was founded on the knowledge, that of eleven millions of British manufactures exported into the United States, only one million was there consumed, while the rest was re-exported to the Southern continent. But from a mere statement of that 343 description he could not surely be made answerable for the extensive and exorbitant adventures which merchants might have afterwards hazarded.
§ Mr. Huskisson
, in explanation, stated, that he by no means wished to convey any imputation against the contractors for the last loan. They took perhaps a very natural course. Having made a very disadvantageous bargain, they were obliged to have recourse to more inordinate speculations, by which the public stock was raised to an unnatural price. Were these inordinate speculations successful, they must have been impositions on the public—failing, they must involve the holders in irretrievable ruin.
§ Mr. Henry Thornton
observed, that he was not surprised to hear that many gentlemen manifested considerable reluctance to accede at first to an application for this relief. He had himself, from the principle of the measure, been much indisposed—and nothing could have compelled him to yield his original opinion, but consideration for the distressed state of the manufacturers in Paisley and Glasgow, and in other manufacturing districts. The difference between the present period and that of 1793 was considerable—the distress of the former was particularly felt by the country banks, and of course was partial, whereas the embarrassment now was general. In the former period it was paper credit gave way, and affected commercial credit; at present it is commercial credit that as fallen, while paper credit has been little affected. The Bank of England was then paying in specie, and had in its power the means of correcting the evil effects which this loan to the commercial body might be supposed to produce. The distress was then attributable to a momentary want of confidence, which was soon dissipated; the failure of this day implied a disease of a much deeper and more serious nature. It was to be feared now that from palpable losses, the capital of trade was in a great part destroyed, and consequently there existed an additional danger to the public of not recovering the money which it should at present advance. Therefore, whilst he was willing to assist the distressed manufacturer, he wished the loan to be applied on a charitable and humane principle, and afforded to those persons and places only where the distress was greatest; because if it were to be distributed on a general principle to merchants who could give security, and 344 proportioned to that security, the consequence must be, that there would be a general rise of price in all articles, and he could never forget that bullion was amongst those articles which would be affected in that way. The Bank of England, under such circumstances, had not the check which it possessed in the year 1793; there was now no standard at all.
§ Mr. Curwen
said, that it was impossible not to see the public confidence was gone; that, therefore, made the measure of temporary relief imperious. Even though the whole money was to be ultimately-lost, the parliament, for the support of our commercial interest, was bound to hazard the experiment. He, however, trusted that the Committee would not limit its attention to this single measure of relief; but, at a proper and early opportunity, apply itself to an investigation of the original and radical cause. From the inquiries he had made in the great manufacturing district of Lancashire, he knew, that the distresses and sufferings of that deserving body were by themselves attributed to the nature of our relations with America. The agricultural interest was now feeling the evil; for, from the distress of the manufacturer, no longer able to purchase the same food as formerly, the farmers could not obtain the same market for their produce. In Scotland, he knew it to be a fact, that the farmers were willing to sell at this moment their fat stock at the lean prices. He conjured the Chancellor of the Exchequer therefore, whatever may be his own predilections, not to continue bigotted to a scheme of policy, which had produced, and must continue to produce, such wide spread distress and privations.
Sir Robert Peele
said, that if the cotton-manufacturers were the only persons concerned, the relief might be withheld, perhaps without much injury; but not only the cotton-manufacturers but the landholders, and many other classes, were deeply interested. He could state it as a fact, that the manufacturers never experienced more distress than when they depended on specie. When invasion was expected in this country, the conductors of the trade were not able to pay their poor manufacturers; and the House might rest assured, that the trade of the country could never be carried on to its present extent, if they were to depend on specie alone. Trade had of late years increased 345 to threefold what it was, and the circulating medium, if inquiry was made into the subject, would be found not to have exceeded its due proportion. He begged pardon of the House for having troubled them with these observations, but he felt it impossible to permit the question to pass without expressing his gratitude for the intended relief, not that it would affect him or his family in the slightest degree, but because he could not suppress a fellow feeling for those who, though now so differently situated, had once assisted him in raising his fortune.
§ Mr. Alexander Baring
expressed a hope that both questions would undergo a strict discussion at some future period. With respect to the first, the cause from which the misfortune arose, it was undoubtedly influenced in a material degree by the political measures; but the great and immediate cause of the evil was the want of a market As long as a single port was open to us, that purpose was answered, but they were all closed at present, and here was the foundation of the pressure which the Committee were now called upon to remedy. With regard to the speculations themselves, they were perhaps rightly described by a right hon. gent., who said that they proceeded from that sort of greediness which sought to exclude all others from the same advantage. But there was one consequence of the present system which they would do well to look to; if America could not trade with us, she must proceed to manufacture for herself (a thing if possible to be avoided), so that in this point of view the political question was in reality involved in a very great degree. The question to consider was, whether a temporary provision should be made in the present instance? a proposition to which he was inclined to give his assent, as he thought it but proper, that whatever arrangements ministers might have made with the merchants should be carried into effect. The expedient, however, did not appear to him likely to give what the merchants wanted; what they wanted was a market. He warned the House against expecting that the money would be returned in any thing like the period understood. His next great objection was that which arose out of the Bank restriction. Paper, it was known, was already over-abundant, and the operation of this measure would increase the quantity. As a general measure, there fore, it was liable to great objections. 346 They should beware lest, in attempting to relieve the manufacturers, they should only give encouragement to speculators and adventurers. He should not go more generally into the political question at present, as he felt it to be of sufficient importance to be discussed by itself. He agreed with the right hon. gent. (Mr. Rose), that the cause which was stated was not the true one, but thought that the board of trade, notwithstanding every disposition to discharge its duties in the best manner, contributed greatly to increase the difficulties and disadvantages of the merchant. Merchants were in the habit of attending on it, to see what particular measures and regulations may be in the contemplation of government, and thus the sound and solid principle of leaving commerce entirely to itself was altogether abandoned.
§ Mr. W. Smith
thought the inconvenience of the measure so far outweighed its advantages, that if his right hon. friend (Mr. Ponsonby) had determined to take the sense of the House upon it, he for one should divide with him. If any man read the Report, he must be struck with the looseness of its assertions; it merely asserted, that loss arose from over-trading, and that benefit would be derived by giving money to assist the losers. He approved of the feelings of the hon. baronet (sir Rob. Peele), though perfectly proper in him it would not he proper in the House of Commons to indulge them. Be ides, if the general principle of such applications were once recognised and established, a pretence would never be wanted for urging them. It appeared to him that there were three sorts of speculators who might meet with considerable difficulty: two of them, being advantageous to the public in general, might be favourably considered, he meant those who exported commodities from this country, and those who imported into it the raw materials from others; such speculators, though they might overtrade a little, might be forgiven. But the third sort to which he alluded, were those who speculated upon articles already in the country, and sought no other object than to put money in the pocket of the monopolist. This trade was not beneficial to any body, and the undertakers of it, when they failed in consequence, ought to be permitted to perish unnoticed. The evidence too upon which they were then called upon to decide was 347 the evidence of interested persons, and the fair inference to be drawn from that circumstance was, that the evidence was necessarily exaggerated. It had been represented as invidious to make remarks upon persons situated as the present applicants were. He certainly would admit, that it would be an invidious task to volunteer any criticism upon their conduct, but when they applied to Parliament they forced themselves into such a situation that it became the duty of every member of that House to investigate and to speak freely. A right hon. gent, had said, that, if the pressure were inquired into, it would perhaps appear to be little more than that persons having capita, but wanting credit from the pressure of the times, wished for relief from Parliament. That it might be expedient to grant relief in such a case, he would allow; but if there was any prospect of effecting it by other means, they should not be too precipitate in their proceedings. If no market was open to these persons they would experience no permanent or substantial benefit, and the public might suffer deeply. Another objection was, the extreme inequality of the measure in consequence of the numbers who had already suffered. He knew it was not easy to avoid this, but still he could not help thinking that it was hard, in times like these, to wait until a number of respectable persons sunk under the pressure, and then to apply a remedy which others would have the benefit of.
§ Sir John Newport
argued, that such grants, dispensed as in the case of 1793, went to derange the whole established system of commerce. Either there should be no secrecy as to the persons borrowing a part of this public money from the commissioners, or the parliamentary creditor should run the same risk as the private creditor. It would otherwise turn out hard upon the latter, that after having lent his money, or taken security on the ostensible property of the debtor—if any failure took place, that on which he depended should, to his great injury, be the sole security of the parliamentary creditor. This he did not think right; it had a tendency not to correct, but to increase the evil. The ground of complaint was the want of a market, and the effect of the measure would be to employ the manufacturers for the present, and add to that glut" which was known to exist in the market already. He dwelt on the expectations held forth from the market of South 348 America, which he considered perfectly delusive and visionary, especially as from the present divided state of that country, the returns were likely to be still farther, protracted, and the market to be more disturbed and impeded than before. He cautioned the House not to expect that the money would be soon repaid; he doubted whether it would afford any relief.
§ Mr. Manning
thought the difficulty of so serious a nature, that they were bound to do all they could to remove it. He agreed with the hon. bart. as to the propriety of equalizing the condition of parliamentary and private creditors, and' thought that though the relief might not prove to be sufficient, it was but right to make the experiment.
§ Mr. Whitbread
would not say that he was courageous enough to resist the vote at present, but he was anxious to be distinctly understood as not intending to pledge himself so far as to prevent his retracting, if at a future stage his conviction told him that it would be right. Of all those who had spoken, not one had expressed a sanguine notion of the success of the measure. The right hon. the Chancellor of the Exchequer had declined answering a question which he had put to him the other day, as to whether he was prevailed upon by importunity to accede to the measure, or was converted to it. If he might judge from the speech of the right hon. gentleman to-night, it appeared that he was no convert, but was persuaded by importunity. The hon. baronet (sir Robert Peele) had spoken with great feeling, but the question was not whether, they should yield to feeling, but whether, the grant of six millions was likely to be of advantage to the operative manufacturer? He characterised the Report as one of the most loose and ill digested that ever was laid before the House, and selected some parts from Mr. Gordon's evidence to prove an inconsistency in his statements. He charged the Committee with not attending sufficiently to the re-' solutions of the Deputation, and reminded the House that he had originally objected to the formation of the Committee, upon the ground that it was likely to be influenced by too large a portion of feeling. He wished that the Report upon the other Exchequer bills had been received before' this motion was made, and alluded to the representation of the flourishing state' of trade in the King's speech of last session.
The Chancellor of the Exchequer
agreed in one thing with the hon. gentleman who had just sat down, and that was the observation that the circumstance of the measure having been brought into the House should not prevent him, or any one, from voting against it, if upon a further view it appeared not to be beneficial. With respect to the hon. gentleman's assertion, that he (the Chancellor of the Exchequer) had yielded to importunity instead of being a convert to the measure, he would own that he had not the same sanguine hope as in the year 1793, but still he thought that it afforded a favourable chance of relief and ought to be tried. Although the most favourable circumstance in the other case did not exist in the present, still there were many favourable circumstances in this case which were not in the other. The market was not now open as it was then, but in 1793 there was a great fall in the stocks, the 3 per-cents. fell from near 100 down to 70, which produced a total loss of capital which could not be relieved by the measure. A right hon. bart. had stated what would in his opinion be the operation of it upon general credit. It was true, that in the former instance the writ of extent was unlimited, but it might be limited now if deemed expedient. The effect it would produce, he thought, must be to make the friends of the party more cautious of coming forward, unless he could give sufficient security in available property. There were now in the warehouses double the quantity of articles that were lodged in them the year before, and these were not merely applicable to the foreign market, but to the home one also, He differed in opinion from those who thought that by removing the Orders in Council they would open a market on the continent. It was not owing to the Orders in Council that the markets were closed, but to the Decrees of the enemy. He contended, that the Orders in Council, so far from being objectionable, had answered the purpose for which they were intended, by driving the tyrant of the continent to such an extremity as to burn all British commodities; an act by which he destroyed more of the property of his own subjects than of the British merchants. They had driven him to such an act as might afford a chance of ridding the world of its oppressor. He agreed with the hon. gentleman, that if he found he had been wrong, it would not be undignified to change his conduct; but he would beg of 350 that hon. gent, to keep his mind open, when he should come to the question, and be cautious of adopting it as a certainty, that the repeal of the Orders in Council was all the Americans wanted. He was: glad the House was inclined to agree to his proposition in the present stage, and declared his determination to change his conduct, if in the progress of the measure he saw any ground for so doing.
§ Mr. Whitbread
said, that the right hon. gentleman had made some imprudent insinuations with regard to America, which he hoped would not shut gentlemen's minds to the case when it was brought before them; he hoped that if America did make any other demands than those which were generally understood, the right hon. gent. would have no objection to accede to his motion for papers.
The Chancellor of the Exchequer
said, that he would agree to his motion if he brought it forward at a time when, consistently with the public interests of the country, they could be granted. He had no objection to repeat what he thought neither improper nor un can did; that gentlemen should not run away with the impression that the repeal of the Orders in Council was all that was required by America., He did not go on to say that there was no hope of accommodating these differences, for he had every reason to hope the contrary.
§ Mr. Whitbread
said, he was relieved, from the impression made upon him at first, by the different tone and manner of, the right hon. gent., now therefore he should content himself with repeating his former questions, as to the objects in dispute between the two governments.
After some further conversation between Mr. Canning, Mr. Ponsonby, and Mr. Rose, the Resolution was agreed to with out a division.