§ Mr. Dugdale
rose to present a petition from the merchants, manufacturers, and traders, of the town of Birmingham. To this important document he begged to call the serious attention of the House. It was proper to state that this petition was agreed upon at a very numerous meeting, held in the month of August last; but owing to the different adjournments of the House, there had not been any possibility of presenting it till the present time. The petitioners stated, that on the 12th of May last they did present a petition to the hon. House, praying that a solemn inquiry might be instituted by it into the causes of the national distress, and praying that some measures might be adopted for relieving it. They set forth, that it appeared to them no legislative measure had yet been adopted for the purposes of such relief, excepting only the appointment by parliament of a committee for the extension of the foreign trade; but they humbly submitted that the home trade was at all times a matter of paramount interest. The petitioners further stated, that the present state of their trade, and consequently of those numerous classes who were dependent upon it, was deplorable. In order to get more accurate information as to the state of Birmingham in this respect, a committee was appointed by the petitioners some time back to inquire into the consumption of meat, beer, and other necessaries in the town, as compared with the year 1818; and the result was, that a most material diminution of the consumption of such articles was found to have taken place, and this, it was unnecessary to add, had existed principally among the lower classes. At the present moment it was not his intention to enlarge upon the subjects to which the petitioners had referred. He would, however, say, that the public books of the country were a 524 fallacious criterion by which to judge of the state of commercial prosperity, for a decrease was often known to exist where the contrary appeared in those books. The petitioners here complained that the agriculture, the commerce, and manufactures of the country, upon which its property depended, were in a state of decay; and therefore they prayed, that a solemn inquiry might be instituted respecting them, and, that wherever a defect was found, it might, if possible, be remedied. He himself had made particular inquiries on the subject, to which the petitioners chiefly referred, and he found, that though there was some improvement in some articles, yet that in the main branches of the trade, there had been a diminution of 25 per cent, the consequence was, that the capitalists were withdrawing their capital in the trade, and the workmen in most instances got employment only for three or four days in the week. The poor-rates were, it was ascertained, about the same in amount as last year; but, looking to the comparatively reduced prices of food, they must in effect be considered higher. The distress complained of was in a considerable degree aggravated by the state of the iron-works in the neighbourhood. In looking at the whole of the case, he feared that the depression arose more from general than local causes. He was not prepared at present to follow up the presentation of this petition with any specific motion. He wished, however, to impress upon the House, that the subject required the most serious attention of the House and his majesty's government. The case was such as called for a speedy remedy, and he hoped, that the petitioners, who had hitherto borne their distresses without complaint, and who were conspicuous for their loyalty, might obtain such attention to their situation as would tend to relieve them from their present embarrassments.
§ Mr. Lawley
thought it his duty to recommend the prayer of the petitioners to the most serious attention of the House. It was entitled to serious consideration, not merely from the number and respectability of the petitioners, but from the importance of the statements it contained. The petitioners had divided themselves into small parties, in order to ascertain, in the different parts of the town, the state of the consumption of articles of necessary use, and they 525 found that it had fallen off one-third in the last two years, and that in the article of bread there had been a very considerable diminution. It was far from his intention to give any contradiction to what had been stated by his ministers upon the improvements which had taken place in many parts of our trade. He had heard such statement with pleasure; but if he were to rest his opinion upon what he knew of the state of the trade of Birmingham, it was not such as would bear out those statements.
§ Mr. Littleton
observed, that if similar inquiries to those made in Birmingham had been instituted in the south-west of the county of Stafford, the same results would have been found. He believed, though the petitioners only hinted at it, that if a committee should be appointed, a great part of the distress complained of would be found to have resulted from what had been, he would admit, very properly, done by government with respect to the metallic currency, and the limitation of issues from the batiks. He had, however, every reason to hope that confidence would soon be restored in this respect. He had heard from several gentlemen connected with the manufacturers in Birmingham, that a great deal of business had been done on paper credit, which must necessarily have been since reduced in proportion to the great reduction of issues from the country banks. This was a great check, and though it could not be said to operate at present, yet it had operated to a very considerable extent at the period when those limitations took place. The petitioners, it appeared, did not attribute the distress of which they complained, to the cessation of the demand for the articles in their trade, at the termination of the war; but they had not carried their inquiries farther back than two years. If they had carried them back for the last five years, he was of opinion that they would have found, that that cause had operated very materially in producing the distress which was now felt. When he considered the very great extent to which the trade, in articles of military furniture, had been carried on in Birmingham, the great quantity of swords, guns, stirrups, and other such articles which were constantly in demand; when he considered the large armaments which were fitted out in almost every part of Europe, and the liberal assistance which 526 was given by this country; when he considered the great bodies of militia which were kept up for so long a time, and when he reollected the increased demand which those circumstances must have created for articles in the Birmingham trade, he could not but conclude, that it would require many years to fill up the chasm caused by the cessation of such a demand. He happened, some time ago, to have been one of a deputation which waited on lord Mulgrave, then master of the ordnance; and he learned, on that occasion, that at one time the demand for arms was so great, that they had been in the habit of manufacturing a musket per minute. He mentioned this only to show the great demand which existed for an article in one branch of the trade. The petitioners admitted that the committee of foreign trade was a boon; but that that alone would not be effectual. Some improvement should be effected in their home trade. He believed that there was no article of domestic manufacture of which there was so large a consumption as our hardware. The hon. member then observed upon the state of the iron trade, and that part of the hardware manufactures with which it was connected, and said, that although the export had, in 1817, been very considerable, yet he believed it was forced, and was the result of speculation, arising, out of the low state of prices. He considered the depression of agriculture one prominent cause of the falling off in the iron manufactures. Any relief that could be devised, and was likely to prove effectual, he would be willing to support. He thought that some relief might be afforded by a revision of our system of taxation. The farmer did not now get more for two bushels of corn than he did some time back for one. He was aware that it would be unpopular to propose the imposition of any new tax: indeed, the proposition would be idle at present, for the country was not able to bear it; but it was his opinion, that if a tax (not an income), but bearing equally on funded and landed property, were levied, it would be a great relief to the farmer, as well as to the manufacturer.
§ Mr. Curwen,
having been requested to support the prayer of this petition, could not suffer it to pass without a few observations. The iron trade was a most important branch of our manufactures; and from the skill and capital engaged in 527 it, it was, he believed, less likely than most others to be interfered with by foreign competition; therefore, when he heard complaints of the depression under which those who were engaged in that trade laboured, he thought it a proof of the great distress in which the country was involved. He regretted, that in the speech which his majesty had been advised to deliver from the throne, there was scarcely any allusion to the agriculture and commerce of the country. Some kind of hope had been held out, when it was stated that an improvement had taken place in some branches; but was this of such a nature as to encourage a hope that a favourable change was about to take place in the state of the country? He believed not; and if his ministers would consent to inquire into the subject, it would be found, that there was more ground for alarm than for hope. It was said, that the increase in our cotton-manufactures was a proof of this growing improvement. If, however, that were to be looked upon as an improvement, the workmen would, as on other occasions have turned round and demanded an increase of wages. He looked upon that increase as the result of a speculation, from which no general benefit to the country would be derived. It was his fear that government had not made themselves acquainted with the real state of the country. That a committee with respect to our foreign trade would be appointed, gave him great satisfaction, and he hoped it would do some good. He also hoped that our agriculturists would get possession of the home market; but he thought that these would not be found remedies for the distresses of which the country complained. We might go on from day to day with such palliatives, but they would not be found sufficient for the evils we had to remedy. If it were not disorderly to allude to what occurred in another place, he might observe upon what had been said—that our distresses did not arise from taxation, for that in that respect sixteen million annually had been taken off since the war. This he should be disposed to consider a boon, if our trade had remained the same as it was at the close of the war; but so far from that being the case, we had lost, in the decline of our trade, more than would be sufficient to cover a tax of 16,000,000l. Was the noble lord opposite prepared now to contend, that we 528 were better by a reduction of taxation on diminished means, than we were when that taxation was greater but when our means were still greater in proportion? Wheat, at the former period, sold for 10s. the bushel, which now only produced 6s. and our other produce were in the same ratio. Could this be called an improvement? An hon. gentleman had spoken of the effect of a metallic currency; now he would admit, that in no case ought we to go back to a system of restriction of cash payments, for that would only delay the evil; but he would ask, whether such an issue of cash would not have the effect of diminishing the value of land; and if that were the case, had we not a right to go into a committee to inquire into the decrease on one property, and the increase on another? The remedy which he thought would be an effectual one was this—a decrease of the interest to the fund holder. This was the only remedy, and the present was the time when the question could be fairly met. The cheapness of food was not under present circumstances a blessing to the country, for it lessened the value of landed property. He called, then, upon the noble lord, not for a committee which would suggest a partial remedy, but a remedy which should be found generally effectual. He grounded this upon the reduction which cash payments would make in the value of landed property. But he had also another ground, the enormous amount of the poor-rates. Why, he would ask, when the value of land was thus swallowed by taxation and poor-rates, might not the landholder as well give up his property altogether? Under such circumstances he asked, had not the landed proprietor a right to call upon the government for that relief which would arise from an equalization of the burden? What was the real property of the kingdom? Mr. Pitt used to look upon it as 28,000,000l. a-year, but he might now say it was not worth" more than 20,000,000l. At that time the poor-rates were only 3,000,000l.; they were now 8,000,000l. Was not this, then, a case which called for legislative interference? Ought not the interest of the fund holder, which was now twice the amount of the value of the land, to bear a fair portion of the public burdens? When he heard an hon. member propose a property-tax; he wished to God that the country was in a situation to bear one; but he asked the 529 gentlemen of landed property what was their present situation with respect to rents? He would state how he himself was circumstanced in this respect? He had been, for a long series of years, engaged in agricultural pursuits, and he thought he might say of himself that he had never been considered a hard landlord; but, notwithstanding, he had almost all his farm-lands offered to be given up to him. When very many of his tenants asked for a reduction of not less than 25 per cent in the amount of their rents, he thought such a reduction unreasonable, but he told them to wait till July, and that then he would consent to let the lands be valued, and they might take them for what they should be worth. Did not this circumstance prove the state in which landlords were placed, and the danger there was of the farmers of the country being obliged to throw back the farms on their hands? From such a state it might be seen how well able the country was, to meet the proposition of a property tax.
§ Mr. Littleton
begged to explain, that he did not mean distinctly to propose a property tax, but had stated that it was just that some share of the public burdens should be laid on that monster of consumption, the funded interest.
§ Mr. Curwen
said, that if what he had alleged was the real state of the case, he would wish to know whether the noble lord meant to adopt as his maxim the ob servation of one of his colleagues, namely, "sufficient to the day was the evil thereof." The number of unemployed hands in the country was daily increasing, and the weight of taxation was bearing the farmer to the ground. If government would go into the examination of these things, it should have his support. This was a time that called on every man to forget party, and to join heart and hand to endeavour to extricate the country from its embarrassments. Some gentlemen were afraid of parliamentary reform, some were afraid of Catholic emancipation, and others had some similar cause of apprehension; but he believed the time was coming, when they would have nothing to do, and, therefore, nothing to fear. If that moment did arrive, men of property and consequence might feel themselves compelled to resort to measures at which they would now tremble.
§ Mr. W. Peel
believed the allegations 530 in the petition were unfortunately true. The trade of Birmingham was in a very deplorable state. He was satisfied the workmen could not be maintained without parochial relief. The inquiry called for, as it would a fiord satisfaction to a numerous class, was, in his opinion, advisable.
remarked upon some of the objects of the petition, and deprecated, in strong terms, any attempt to abrogate the Bank-payments act, which had been passed only two years ago, and also deprecated the resorting to any remedy for the national distress, which should be founded on a breach of the public faith. He could not contemplate any thing more unjust, or whose tendency would be more fatal. He begged those gentlemen who made such a proposal with the view of reaching the great fundholder, to consider what in such a case would be the state of the small fundholder, whose whole means of existence were dependent upon the observance of the public faith? He considered the proposition neither honourable nor useful; but, if any motion was founded on the petition, he would give it his anxious attention, as no one was more inclined to favour every inquiry which could tend to the relief of the country.
was surprised that the right hon. gentleman had sat down without expressing more of his feelings oh the specific subject before the House. In what he had said with respect to the interest of the national debt, he agreed with the right hon. gentleman; and if there was one subject on which every honest and honourable man in the country were united, it was that; for that country could have no honesty and no honour, which, after passing through a war like the last, by borrowing money of some of its subjects, should in peace refuse to make good its engagements. He was sure the benefits calculated upon from such an expedient would not be realised, and, that in a country like this, one description of property could not be touched without endangering every other. The hon. gentleman would find, if the mortgage which the public creditors had on the property of the country were disregarded, that his own title-deeds would soon be worth nothing.—
§ Mr. Curwen
wished to keep good faith with the public creditor, if that, 531 were possible. It was on the assumed impossibility of doing so, that his argument was founded.
resumed. Undoubtedly it had been proposed by many gentlemen to pay off the public debt by means of a sacrifice of property on all sides; and such a doctrine had even been supported by high authority in that House. He himself had always considered it impracticable. The sacrifice of general property must be at all times, and in all countries, attended with much danger. When his hon. friend spoke of impossibility, as the reason why such a plan should not be adopted, he would say, that he never considered it impossible to pay debts as long as the party owing them possessed a farthing of property. The petition brought the House to the consideration of the general concerns and state of the country; for although it presented a correct representation of the state of Birmingham, it was also a true picture of the whole nation. There was no interest in deeper distress than the agricultural interest; and that was certainly a most important consideration for the House, and most particularly for country gentlemen. For that reason he had been surprised to see the right hon. gentleman sit down without adverting to so interesting a topic. It was a serious thing, that the sixth year of peace should find the nation in such a state, that a speech from the throne represented no one of its interests to be in a state of prosperity. He was not to be considered as a party man upon this subject, and he hoped that all would come to it, without any of those differences of opinion, which arose from party motives. Nothing was so urgent and important as a strict examination into the causes of our present state—a state, he was convinced, not resulting from the cessation of war, for the petitioners themselves proved it. They stated that the year 1818 was a year of comparative prosperity; and that since that year their distresses had been accumulating. They also said, that their local distress originated in the great depression of the American market. The Americans had formerly sold their flour for 10 dollars, and could now get only three dollars and three quarters. The consequence of this was, that the manufacturers of Birmingham, who had worked more exclusively for the American market, felt a great diminution in the 532 demand for buckles and similar articles which they have been accustomed to supply. This falling off in the American trade increased the effect felt from the defalcation of the home trade, which was always the chief resource. Whatever might be the intention of parliament, he, for one, thought that the subject required the deepest consideration. No relief could be safely or effectually applied, without fairly ascertaining the real, undisguised state of the case. He had no hesitation in making up his mind respecting a great part of the difficulty and distress of the country. A very considerable part of the distress, he was convinced, arose from the nature of the currency. He did not mean to say that we ought, therefore, to return to an unlimited paper currency; he only wished to call attention to the danger of a departure from a proper standard. That departure had undoubtedly produced extravagance in the public expenditure, for which we were now suffering so severely, and increased the public debt to an amount so enormous as to make a return to the right standard extremely difficult. Yet he was of opinion that the produce of the soil was not of much less value now, when the quarter of wheat was sold for 60 shillings, than it had been when the price was 80. It was less relatively to nominal pounds sterling; but a quarter of corn would now buy as much cloth, or as much iron, as when it sold for 80s. If they supposed a man to have had no debt, and to have now an income of 60l. instead of 80l., he was in the same relative situation. But, unfortunately, many farmers of small capital had been induced, by the rise in the prices of corn, to take farms under mortgages for a large portion of the price. In consequence of having thus tampered with the currency, many honest farmers had not only lost all their property, but were themselves in gaol. Many instances of men having so suffered, had come under his own observation in Somersetshire—of men who had not only lost all the capital they had engaged in agriculture, but were themselves in prison. The currency had thus occasioned a serious hardship to many of the most meritorious class of persons in the community. Of course this evil had extended to every kind of landed property. The great debt, operating as a great mortgage, had produced the same kind of inconvenience in propor- 533 tion to the real property of the country. He trusted that these calamitous results would, in future times, operate as a warning against similar acts of injustice, in the event of the country recurring to a state of war. Unless the whole system, and the consequences of that system, were thoroughly understood, he was persuaded that two years of war would bring back all the evils which had been produced by the state of the currency. The facts stated by these petitioners, that a diminution had taken place in all the articles of consumption, was undoubtedly true; but gentlemen on the other side of the House were in the habit of referring to the increase of exciseable commodities, in opposition to this statement. Now, it appeared to him, that there was no difficulty whatever in reconciling the diminished consumption of which the manufacturers of Birmingham complained, with the increased consumption of exciseable commodities. If 100l. now, would go as far as 120l. or 130l. before, it was evident that the increased consumption of exciseable commodities arose from the increased means of the man of fixed income. For instance, any person who formerly kept a horse, when oats were 50s. a quarter, might now keep two horses, when oats were but 25s.; or at least, any man who formerly kept two, might now keep three horses. There was another circumstance which was also to be taken into consideration, namely, the operation of 3,000,000l. of new taxes; the increase of revenue was not, therefore, a fair measure of the increased consumption. It should never be forgotten, however, that the increase of the prosperity of the unproductive classes of the community, was a consequence of the decrease of prosperity among the productive classes. This was a most unfortunate circumstance in every point of view; and if any proof of this fact were wanting, it would be found in the state of the excise in Ireland, where there were but few stockholders, and the number of persons possessing fixed incomes, as compared with this country,: was very trifling. There the excise would be found to have diminished, so much so, that upon a comparison of the years 1820 and 1821, it had fallen off from 1,700,000l. to 564,000l. It was the drones in society whose means of enjoyment, were increased, while the interests of all who were actively engaged in commercial and agricultural pursuits were 534 depressed. The main object at present was, to endeavour to understand our situation, and to see our way out of the difficulties which surrounded us. The subject which most called for the deliberate considerati on of the House, was, undoubtedly, the expenditure of the country. The House should compare the expenditure of the country in former times with the expenditure which had grown out of the state of the currency; and if 60s. were now equivalent to 80s. at a former period, they should consider the best mode of bringing back 80s. to 60s. in our expenditure. In saying this he disavowed any disposition to starve the servants of the government, or to underpay the services of necessary and efficient officers. There, was no worse economy than remunerating efficient services inadequately; especially if that reduction were applied to subordinate departments. But, though such reductions would not only be improper, but dangerous, there was undoubtedly a great deal to retrench in the expenditure of the country. An hon. gentleman on his side of the House had stated, that the expenditure of the country, independently of the additional quantity, had been augmented threefold since the year 1792. No doubt, retrenchments to a very considerable extent might be effected; and from the temper and deliberation with which, he was persuaded, the House would examine this subject, he was apprehensive of no ill-consequences. He deprecated any violation of the public faith, and he hoped the country would be able to hold to the present state of the currency; but he was persuaded that we could neither do one nor the other, without retrenchment in the expenditure of the country. There were, indeed, many parts of that expenditure which it would be very difficult, if not impossible, to retrench; such as the soldier's pay, retired allowances, and similar branches of expenditure, in which it would be impossible to explain to the persons to whom the reduction would apply, the necessity of the alteration. This was one of the great mischiefs of tampering with the currency of the country; for it was, in many instances, impossible to take back what had been once granted, when the pay became more than adequate to the services. It was certainly most unpleasant for gentlemen of large landed fortune to consider that they could no longer get the same rents which they had received 535 under a different state of things. The misfortunes of the country arose in a great measure from gentlemen not taking these circumstances into consideration, and entertaining such unreasonable expectations. The price of corn, as compared with other commodities, was, in fact, nearly as high as it had ever been. Though he thought it would be highly inexpedient to tamper with the currency, he wished, at the same time to hint at the course which he should wish to see adopted. He was desirous of giving the public creditor all that he was by law entitled to, but not to go beyond it. If the House would hereafter grant him a committee to facilitate the investigation of this subject, he should suggest the expediency of giving to the Bank the option of paying either in gold or silver, that the value of the two precious metals might be rendered more equal, and the present pound sterling, which was somewhat too high, relaxed. He wished to relax a cord which was at present stretched somewhat too tightly. Without meaning to suggest insidiously an act of injustice with justice in his mouth, or to trench upon the system of the member for Portarlington, he thought that the pound sterling might be made subject to payment in either of the precious metals, without the slightest injury to the public creditor. This course would have the effect of removing a great deal of uncertainty which at present prevailed. There was hardly a country bank which knew what to do, from the uncertainty as to what was to become of the system; and it appeared, from a late discussion in that House, that the Bank of Ireland refused to take gold coin as a deposit, and that the paper pound was actually three per cent above par.
was of opinion, that much good would result from an inquiry. The petitioners stated, that the year 1818 was one of comparative prosperity. This was also the case with agriculture. This proved the union of the two interests, and that whilst the one flourished, the other prospered.
§ Mr. Ricardo
said, that if the House would indulge him for a few minutes, he should be desirous to make one or two allusions to what had fallen from his hon. friend below. The great point to which, his hon. friend had addressed himself as the origin of the prevailing distress. By some persons this was ascribed 536 to taxation, by others to restrictions on trade, and by his hon. friend to an alteration in the currency, which he seemed indeed to consider as almost the exclusive cause. With this view his hon. friend had entered into a comparison of the prices of corn at various periods, and he stated the fall to be from about 80 to 60s., inferring that other articles had undergone an equal depression. He seemed to think that with a quarter of corn he could now purchase the same quantity of other commodities which he could have obtained with it when com was at 80s.s and that the reduction of prices was therefore general and equal. Now, this representation he apprehended was erroneous. He could not agree that prices had fallen generally in the same proportion. He believed that the fall in corn had been severe beyond measure, whilst there had been no fall with regard to many other articles, or at any rate no fall in the least degree similar. If the prices of bullion were referred to at former periods, it would be seen that the price of corn had altered to the amount of 25 per cent. He was surprised to find his hon. friend making a statement from which, if correct, it must be inferred, that the distresses began at the moment when the last change in the currency took place. Now, if he looked back to the price of bullion in the flourishing year 1818, and compared it with the present price, it would be seen that the difference did not exceed 6 or 7 per cent. To this extent other prices might have since been affected, and he had no doubt that there had been a considerable reduction of prices in other countries. Wine bad fallen here, and so had cotton goods; but he believed that fall was not more than equal to that which had occurred in most parts of Europe. In 1816 the price of gold was at 4l. an ounce. In the following year it was 4l. and 6d. In 1818 bullion still did not rise above 4l. 2s. and 4l. 3s, and in 1819, when the plan which he had the honour to recommend was adopted by the House, it was at 4l. 1s. The question, then, before the House was, whether it was advisable to return to the old standard, or to take the existing market rate, which was then, about 4 per cent above that standard as the measure of value in future. But his hon. friend had argued on this subject as if bullion had been at that time, as it formerly was, at 5l. or 5l. 10s, an 537 ounce. If, instead of being at 4l. 1s. bullion had been much higher, he should not have proposed a recurrence to the mint standard. What he was anxious about, was not to restore the old, but to establish a fixed standard; for, however desirable it might be to a body of merchants or bankers to possess the power of raising or lowering a fourth or fifth the value of the currency, and to make 3l. 17s. 10½d. at one time, equivalent to 5l. at another, it was a power destructive of every engagement, and finally ruinous to every interest. He was not anxious to restore the old standard; but the market price of bullion being then only 4l. 1s., he did not think it necessary to deviate from the ancient standard. What increased his surprise at the view which his hon. friend had taken in tracing all our distress to a variation in the currency was, that when a few years back we had so much greater variations, we had no such distress. With regard to the depression of agriculture, he believed it was a good deal owing to the laws which were enacted for the purpose of protecting it. It was certainly desirable that those engaged in the production of corn should have a vent when an excess of supply existed. When two or three good harvests followed in succession, we might, if prices were at all on a level with those on the continent, export it after a fall of three or four shillings a quarter; but at present there must be a destructive fall before it could be sent abroad. The hon. member for Cumberland, as well as the hon. member for Staffordshire, had talked of the extreme pressure of taxes on agriculture; as if they were found, in that respect, to be peculiarly burdensome. The stockholder was described as being comparatively free from these effects; but it would not be difficult to show, that all taxes fell upon the consumers of those commodities to which they were annexed; and if this were not the case, he did not see what right the landowner had to ask for protection. He could demonstrate, if it were necessary, that taxes always raised the price of that commodity on which they were laid, and therefore fell on the consumer. Was it not impossible that farmers could continue to grow corn for a series of years unless they obtained remunerating prices?—He would now offer a very few remarks on what had been thrown out as to the restoration of two 538 metals as a standard. It gave him pain, however, to hear any allusions made to the subject of not paying the public creditor, and to find that they met with the reception which they did in some quarters. If, indeed, the dividend was to be reduced, he trusted that it would be done openly, and that no stratagem or delusion would be practised. With regard to the plan of his hon. friend, he was sorry that he could not approve of it, recommending, as it did, a different standard from that fixed in 1819; at least, he could not help thinking that the plan amounted to this when he heard his hon. friend say, that the string was too tight, and that it was desirable to empower the Bank to pay either in gold or silver. This appeared to him to be a complete departure from the true and sound principles of currency. No currency could be of the same value perpetually, any more than other articles could always retain the same price. Gold bullion, however, was the commodity which varied the least; and if a contract was made to pay 100l. at a future period, the contract would be most faithfully performed by the payment of that sum in gold. But it might suit the purpose of the debtor to pay it in silver, whilst, by so doing, the creditor would sustain a loss. The two metals seldom maintained the same proportion to each other long. The price of the one might rise, while that of the other fell. So the Bank being now under an obligation to pay 60 ounces of gold, would enable a person who received it, to propose more, or a greater nominal amount of commodities" than he would if he paid in silver. The relative value of the two metals had varied since the act of parliament; but what was the cause of that variation? It was this: the Bank being a timid body, seldom clinging to the true principles of circulation, had taken alarm, and had made great and unnecessary purchases of gold, although they found, by experience, that no person applied to them for any. He almost doubted whether a single bar had been demanded from them since the commencement of the new plan. If the Bank were enabled, according to his hon. friend's proposition, to pay in silver instead of gold, they would now realize a profit equal to the difference between 4s. 11½d. and 5s. 5d. As soon as this profit should cease, the two metals would have recovered their rela- 539 tive value, and then it would be difficult to discover the value of his hon. friend's proposition. He had proved last session that the two metals might vary to the extent of three per cent; but his hon. friend then remarked, that this might be true in theory, but in France, where the experiment had been tried, the difference did not exceed one per mill. Still it was something to find that the possibility of the variation was admitted. He entirely agreed in all that had been said with regard to the retrenchment in our expenditure being the principal, if not the only source of relief. The committee would, he doubted not, without preconceived or particular views, inquire whether the present system of restrictions on trade was advantageous to the country. He should only add, with respect to the rents of land, that no interests could be more distinct than those of the owners and occupiers; yet it did happen that the latter were persuaded to petition that House for regulations which might be beneficial to one class, but most injurious to themselves.
Mr. Alderman Heygate
denied that the distress was confined to the growers of corn. It was felt in the production of all articles. It extended to other countries, and especially to America, where the principles of the hon. member (Mr. Ricardo) had been pushed to their fullest extent. The hon. alderman alluded to the passing of Mr. Peel's bill, which, he contended, had produced all those evil effects, of which he had forewarned the House. The title of the bill ought to have been, "a bill to add one-third to the national debt; to add, in the same proportion, to all fixed incomes; and to subtract an equal amount from all the resources of productive capital and industry." As to the remedy which had been suggested by reducing the interest on the public debt, it was objectionable both in justice and policy. Even while parliament should be deliberating on such a measure, an immense portion of capital now vested in the funds would be transferred to other countries, never to return. Still, however he might disapprove of the late act, he should pause before he would advise its repeal, considering what had been since done to carry it into effect—how much had been already endured—and that we were now at peace, with the balance of trade improving in our favour.
proceeded to explain his 540 former observations, particularly where he differed from his hon. friend. His hon. friend argued, that the alteration in the currency could only operate in proportion to the difference in the price of bullion, which had only varied from 6 to 7 per cent. It by no means happened that temporary variations in the price of bullion affected the prices of other articles. In the course of one day, bullion had often risen and fallen again. Indeed he recollected, that the day of the battle of Waterloo, it had varied to the amount of ten per cent. Its effect on prices was gradual. As to the depreciation of the currency in its relative Value to the several commodities, the issue of 15 or 20 millions of paper would produce that depreciation as well as an equally increased issue of gold; but the depreciation of the currency from the issue of paper had not been so sensibly felt in this country until the very mistaken measure was adopted of making paper a legal tender, and thus forcing it into circulation. The consequences, indeed, of the general system with respect to the issue of paper, had been, to drive gold out of the country. But, from the operation of the plan lately adopted by the legislature with regard to the resumption of cash-payments, he repeated his conviction, that the value of the pound sterling, with reference to the price of commodities, had advanced one-third, or at least one-fourth, above that which it bore during the latter years of the war. Of this, indeed, every man must be sensible who tried to revert from his present habits of expenditure to those which he pursued at the early part, or previous to the late war. But the comparative difference between the value of the pound sterling, and that of the several commodities, must be obvious to any one who considered the reduced price of corn, of cotton, and hardware, as well as that of other commodities, which he need not detail. Here the hon. member again urged the policy of allowing of a double tender, a standard of value, that is, of silver as well as of gold. That one standard of value was a pleasing thing for his hon. friend to fix upon, wen discushsing those subjects in his closet, was very probable; but for what purpose of practical utility such a standard should be fixed, he, as a practical man, was quite at a loss to imagine: although the establishment of such a standard might be more agreeable to the 541 views of the Royal Society, or other abstract philosophers, who would regulate weights and measures by the vibrations of the pendulum. For he could not see why the Bank of England should not have the option of paying in silver or gold, as well as the bank of France. Such was the practice in all the great commercial establishments of the world, as well as in France, with the exception of the city of Hamburgh. But it was known that silver had been the ancient standard of value in this country. His opinion, however, was, that there should be an option of paying in either silver or gold, in order to afford additional facilities for our circulating medium, and to relieve the bank from those measures, which, from an over-anxiety to comply with the prescriptions of the legislature, it had no doubt taken to provide a certain supply of gold. But he was the more solicitous upon this subject, because he felt that the establishment of a double tender would enable the bank to afford such facilities as would materially contribute to relieve the distress of the country.
§ Mr. Ricardo
remarked, that the difference between his hon. friend's opinion and his own was this, that he maintained the advance of the pound sterling with reference to the price of commodities to be only about 4 or 5 percent, which was equal to the difference between the price of gold at 41. 1s. and 3l. 17s 10½d. an ounce, while his hon. friend maintained that advance to be equal to 25 per cent. But how came it, he would ask, that although Russia, Austria, and France had adopted the same system as this country in the issue of paper, there should be such a difference in this country alone as his hon. friend had stated? He, however, differed from the views of his hon. friend, the principle of whose animadversions would in a great measure operate against any metallic currency whatever. With respect to his hon. friend's recommendation of a double tender, it was obvious, that if that recommendation were adopted, the Bank, although it seldom saw its own interest, would be likely to realise a considerable sum by the purchase of silver at its present reduced price of 4s.11d an ounce. But as this purchase would serve to raise silver to the Mint price of 5s. 2d and comparatively to advance the price of gold, the consequence of which would be to drive gold out of the country, this was, among 542 other reasons, an argument with him for resisting his hon. friend's doctrine.
stated the fact, that during a period of two years and a half the Bank had issued rive millions and a half of sovereigns, notwithstanding which, not one was to be seen in circulation.
§ Mr. Hume
observed, that the fact stated by his hon. friend, with respect to the fate of the sovereigns issued by the Bank, afforded conclusive evidence of the consequence of an excessive issue of paper in driving gold out of the country; for it appeared, that of the five millions and a half of sovereigns which the Bank had issued, no less than four millions had been recoined by the treasury of France.
§ The petition was ordered to lie on the table, and to be printed.