§ The order of the day having been read for resolving into a Committee on the Commercial Credit Bill, the Chancellor of the Exchequer moved that the Speaker should leave the Chair.
Lord Folkestonecontrasted the Committee in whose report the present measure originated, with that Committee on the same subject in 1793. The Committee of 1793 was composed of fifteen individuals, only four of whom were commercial men. The late Committee was composed of 21 individuals, two-thirds of whom were commercial men, and the other third, persons in office, or connected with office, who were therefore interested in the decision of the question. The right hon. gent. who had proposed the measure, had said, that it was a claim on the humanity rather than on the justice of the House. Now, however the House might lament the distresses of individuals, they had no right to grant the public money on such a ground. His opinion decidedly was, that although the operation of the Bill might occasion an immediate relief to those who were suffering, they would ultimately experience from it the greatest injury. The present commercial situation of the country was very different from that in which it had ever before been placed; and all arguments therefore, which assumed to be derived from experience, were futile. He did not conceive that we could calculate on any vent for our goods, either in the North American, the European, or even (except to a small extent) in the South American markets. If, however, British manufactures should find purchasers in South America, what would be the return? Precisely that produce of which our merchants already had more than they knew what to do with. It was childish policy to put off an evil which, when it did arrive, would consequently come with accumulated force. He made no doubt that the commissioners to be appointed under the act would be trust-worthy persons, and that they would not grant loans, except on the deposit of articles, which would be available to the public by sale, in the event of the incapacity of the borrowers to repay the sums advanced to them. Still, in that case, the public would be losers. Of course a considerable public loan would be soon to be raised; and was it not evident that if exchequer bills to the amount of six millions were issued to prop commercial credit, the loan would necessarily 417 be made on terms comparatively disadvantageous? He lamented that the right hon. gent. had brought forward this measure at all, and feeling as he did, that eventually it would be injurious as well to the individuals immediately concerned as to the country at large, he should take the sense of the House on the motion.
Mr. Marryatdeclared, that a full consideration of the subject had induced him to change the opinion which he originally entertained. He was now convinced that the good to be derived from the proposed measure, would far outweigh the inconveniences that might attend upon it. He denied that all markets were shut against us. Many were yet open; and there was still a great demand for certain articles of our home manufacture. But the capitals of our manufacturers were so locked up in the stock on hand, that they were not enabled to make the goods which were in demand. The markets of Martinique, Guadaloupe, St. Domingo, &c. were all open to us; and the only consequence of an inconvenient nature was, that the returns were of an unproductive nature. By a change of policy, however, our returns might be rendered completely productive. If the United States persisted in enforcing the non-importation act with respect to us, we might adopt a similar measure with respect to them. At present we received indigoes, cotton, and tobacco, from the United States. If we encouraged the cultivation of these articles in the conquered colonies which we possessed, we might from them and from the Spanish colonies receive the indigoes, cotton, and tobacco, which we consumed at home, in lieu of the unproductive returns of coffee and sugar. He was satisfied that it would be of the utmost national importance, by granting a temporary relief to the merchant, to save him from being compelled to make the dreadful sacrifice of 40, 50, or 60 per cent. on his property; and by granting temporary relief to the manufacturer, to render it unnecessary for him to discharge those whom he had hitherto employed, and to enable him to manufacture those goods which were still in demand. While he was speaking on this subject be could not avoid recommending the introduction into the Bill of a clause, by which no commissioner under the act should be allowed to receive any Exchequer Bills himself, or to become security for any other individual who might be disposed to receive them. 418 This he advised, not from any the least suspicion of improper conduct on the part of the commissioners, but because he thought it was highly important that they should possess a weight and respectability which such a provision alone could give them.
§ Sir J. Newportwas more strongly convinced than ever that his doubts on this subject were well founded, and that the measure would be highly injurious to the community. The present distress was of a complexion entirely different from that of 1793. It arose from over-trading, which was not then the case. The probable termination of it was most uncertain. He had no doubt that when the time for the repayment of the loans advanced should arrive, the parties would come down to the House with an application for the extension of the period of payment, on the ground that the markets for their commodities were more firmly closed than ever. Thus they would be involved in still deeper ruin, having been tempted by the proposed measure to engage in additional speculations. The injustice of the assistance which the Bill went to afford, appeared to him to be manifest; as he was persuaded that when the period of payment arrived, that period would be extended, and that this operation would be repeated until the whole sum originally advanced would ultimately be lost; the consequence would be, that Parliament would visit on the public—on unoffending and innocent individuals—the errors of inordinate speculators,
§ The House then divided—
| For the motion | 113 |
| Aganist it | 16 |
| Majority | —97 |
The Chancellor of the Exchequerthen informed the House that it was his intention to extend the advantages of the Bill to all places where the ware housing system was carried on. He also observed, that with a view to carry into effect what was evidently the intention of the antecedent Committee, namely, to allow the borrowers to have the benefit of the dividends before the payment of their instalments, he should propose that the payment take place 15 days later than the period recommended by the Committee, Instead, therefore, of the 15th or 16th of January, he should propose that the payment be made on the 1st of February. He proceeded to read the names of those whom it was his intention to propose as commissioners under the act 419 —He then adverted to the clause suggested by an hon. gent, by which the commissioners should be precluded from participating in the benefits of the act; and observed, that after the selection of the persons whom he had named, it was not likely that the necessity of such a clause should occur to him. Although he did not mean to propose such a clause, yet, if the hon. gent, thought it would be more creditable to the commissioners that a provision of that nature should exist in the Bill, and would propose it, he should have no hesitation in acceding to the proposition. He then moved to fill up the blanks in the manner which he described.
§ Mr. Tierneywas very willing that the manufacturers should be assisted, but conceived that the proposition of the right hon. gent would give too extensive facilities to speculation. He was anxious that the advantages of the Bill should be confined to the manufacturing interest; and if he could frame a clause to that effect, he should certainly submit it to the Committee.
The Chancellor of the Exchequer, if the right hon. gent. were to propose such a clause, would certainly oppose it. The object of granting relief to the manufacturer would not be obtained, unless the means were afforded to the merchant of discharging his debt to the manufacturer; "or would the proposed measure benefit those who had inordinately speculated. No man would be relieved by it, who could not shew by the deposit of the articles, on the security of which the loan was to be advanced, that he had been successful in his speculation.
§ Mr. Tierneycontended that in many cases when the merchant obtained a loan, he would employ but a small part of it in the payment of his debt to the manufacturer, and particularly to the small manufacturer. It had been urged by an hon. gent. that the capital of the manufacturer was in many cases locked up, and that the receipt of Exchequer bills would enable him to manufacture such goods as were in demand. Very different, indeed, appeared to him to be the merits of the merchant and the manufacturer. The merchant having bought goods on credit from the manufacturer, sent them to South America. If the speculation proved successful, it was profitable to the speculator; if unsuccessful, the loss fell on the manufacturer. Was this the character entitled to assistance? And yet he was persuaded 420 that, under the proposed plan, this description of men would absorb the greater part of the six millions that were to be issued.
§ Mr. Huskissonwished the Bill could be better adapted to the case. The natural course of proceeding appeared to him to be, to give a preference to those who were particularly oppressed. In the first place, to give priority to goods as a security over personal security, and then to some description of goods over others, namely, British manufactures primarily, and then colonial produce. In the present depreciation of goods in the market, he thought the public would run no risk by advancing 75 per cent upon them instead of 50 per cent. When goods were the security for a loan, he conceived that the addition of personal security would be embarrassing. He repeated, that by advancing money in the first place to those who possessed the greatest quantity of unsaleable goods, the most effectual relief would be given to the parties the most deeply distressed; but that by advancing money generally, and without distinction, but a small portion of it would reach those whom it was essential to relieve.
§ Mr. H. Thorntonwas of opinion, that the preamble of the Bill might recite what was the general intention of parliament on the subject, and thus serve as a guide for the conduct of the commissioners. He certainly was desirous that the manufacturers should be the persons chiefly benefited by the proposed measure, although he was not for limiting the advantages of the measure so exclusively to the manufacturers as had been recommended by the hon. gent.
The Chancellor of the Exchequerthought any recitation in the preamble, of the view of parliament, might tend to create difficulties in the execution of the trust to be reposed in the commissioners. The committee would be aware, that among the commissioners whom he had named were several of those gentlemen who had been most active as commissioners in 1793. On that occasion the commissioners had proceeded by framing general questions, to which all applicants for relief replied on oath, and thus underwent such a severe scrutiny, as to repel many improper applications. He conceived that it would be proper to compel every applicant to declare for what-purpose he wanted assistance, in order that the commissioner might know they granted money 421 for proper objects; and he was convinced, that the best security which parliament could have for the proper distribution of this sum of six millions, was the wisdom and discretion of the individuals in whom the power of distributing it was to be vested.
§ Mr. Tierneyrepeated his anxiety for the lesser manufacturer, who, he was persuaded, would not be paid, or, at most, paid but in part by the merchant, after the latter had obtained a loan for that purpose. Great difficulties would take place also in the due appreciation of the value of the goods which were to be pledged for the payment of the money borrowed.
§ General Tarletonsaid, he held in his hand some Resolutions of the merchants of Liverpool, declaratory of their intention to apply to parliament for the aid of a million. He wished to know whether it was intended to grant an additional million for that purpose, or to allow the Liverpool merchants to partake of the six millions to be advanced by the Bill?
The Chancellor of the Exchequerreplied, that the merchants of Liverpool would enjoy the same advantages as any other merchants who applied for relief.
§ Mr. W. Smithwas persuaded that many merchants who would borrow money under the act for an avowed purpose, namely, to pay their debts to the manufacturers, would employ but a portion of it in that manner, and by way of speculation would purchase with the rest goods at their present depreciated value. He knew no mode of guarding against this perversion of the intention of parliament, but by giving complete publicity to the applications made to the commissioners.
The Chancellor of the Exchequerprotested against the publicity recommended by the hon. gent. and observed that no part of the conduct of the commissioners in 1793, deserved, and obtained greater praise, than their honourable secrecy. As to the apprehension of the hon. gent. that the merchant would purchase the goods of the manufacturer at a depreciated price, such a sale on the part of the manufacturer would not be compulsory, as he might, if he preferred it, obtain relief from the commissioners by the deposit of his goods.
The motion was then agreed to; as was also a clause, by which it was provided, that no person in the Exchequer bill office should receive additional fees in consequence of the additional issue of Exchequer bills.
422 The House was then resumed; the report was received, and ordered to be taken into further consideration to-morrow. The Bill was ordered to be printed.
§ Mr. Tierneymoved, that there be laid before the House the Minutes of the Evidence taken before the Committee on Commercial. Credit.
The Chancellor of the Exchequerobserved, that having so recently detailed his objections to this proposition, he felt it to be unnecessary to repeat them.
§ The motion was then negatived without a division.