HC Deb 27 February 1824 vol 10 cc551-71

On the order of the day, for going into a committee on this bill.

Sir R. Heron

put it to the learned Serjeant, whether he would bring forward his motion at that late hour, when the House was exhausted, when many members had been present nine hours, attending to the business of the House, and who wished to take part in the discussion. He trusted the learned Serjeant would not press the measure.

Mr. Serjeant Onslow

said, that if the hon. baronet had been in his place on Friday last, he could not have made this request. It was then expressly agreed, that the subject should come on this night. He should certainly not accede to the hon. baronet's request.

The question being put, "That the order of the day be now read," the House divided: Ayes 85. Noes 31. On the question being put," that the Speaker do now leave the chair,"

Mr. Robertson

rose to oppose the motion. He began by stating, that under the Roman republic, the rate of the interest of money declined as the wealth of the country increased, down to the time of Justinian, in whose code laws against usury were established, limiting different rates of interest to the different classes of the community. In the flourishing state of the Italian republics, during the middle ages, the usury laws established a fixed rate of interest according to the rate of commercial profit, and under these regulations the Italian republics formed one of the most flourishing commercial communities in Europe. When these republics were overturned, the sovereign princes who obtained possession of them abandoned these wise regulations, and leagued themselves with the monied men of the country to oppress their subjects by usurious contracts. To that circumstance, he contended, the downfal of those states was chiefly to be attributed. It was true, indeed, that the church issued edicts, prohibiting usurious interest; but the clergy of Rome were themselves the most grinding and rapacious of usurers. He had heard it stated, from high mercantile authority in that House, that there were no usury laws in France, or in Holland, or in Hamburgh. This was certainly not the case. The laws of the German empire fixed the rate of interest at 6 per cent, and those laws were strictly enforced at this moment at Hamburgh, where no man could lend money upon landed, or other security, at a higher rate of interest. Mercantile men were generally misled on this subject, because bills were allowed to be discounted at any rate at Hamburgh. This was an exception to the general law, made in favour of mercantile transactions, to which he had no objection. In Holland, before the introduction of the Code Napoleon, which did not enforce the usury laws, it was difficult to ascertain the precise state of the law with regard to this subject; because, under the republic, each of the seven United States enacted its own laws. In the sixteenth century, although Charles 5th had enacted a law, that no person should take more than 12 per cent interest, the evil arising from usurious transactions was so great, that the States General passed several laws on the subject, the preambles of which set forth the deplorable state of the country arising from the system of usury then in force. With respect to France, it was true that mercantile men evaded the laws there as well as in this country, but this did not disprove the beneficial operation of legislative restrictions. Mr. Preston, who had given most valuable information on this subject before the Committee, although upon the whole, the Report was most defective, had pointed out a mode of evading the law, by borrowing a sum of 10,000l., and agreeing not to draw more than 5,000l. from the lender's banker. In this transaction, money was in effect borrowed at ten per cent, and the law was completely evaded. The usury laws were evaded in a similar manner at Hamburgh, by Jews and other persons, but this was no argument against their utility, in affording protection to the community at large.—Having stated thus much, by way of historical detail, he begged leave to call the serious attention of the House to the consequences which would result from an alteration of the Usury laws in our own country. These laws were first enacted at the time of the Reformation, in the reign of Henry 8th; but they were not carried into effect until the reign of queen Elizabeth. Now, what was the state of this country before the enactment of the usury laws? We had not a ship of our own; we purchased ships from the Hanse Towns, which had usury laws. Since the usury laws had been in force, we had gone on in every succeeding age, flourishing in wealth, industry, comfort, and every blessing which a nation could possess. It was true, indeed, that Edward 6th abandoned the laws which had been enacted by his father; but the consequences of their repeal were found to be so pernicious, that Elizabeth, his enlightened successor, re-enacted them. He begged leave to call the attention of the House to those countries where there were no usury laws in operation. The most pernicious consequences flowed from this source at Rome, until usury was re-strained by the Sempronian law. The virtuous Brutus borrowed money at the rate of 48 per cent in the province of Cilicia; hence arose his quarrel with his friend Cicero, who would not give his sanction to the usurious contract. He begged to correct himself with the House; the virtuous Brutus did not allow his own name to stand in the foreground, but employed an unprincipled agent, named Sanctius, for that purpose. Europe furnished no instance, at present, of states, from which examples could be deduced, of the ruin which resulted from the absence of usury laws, and he was, therefore, compelled to resort to distant times, in order to satisfy the House of the danger of a repeal of the existing laws, and to prevent them from being hurried into so ruinous a measure. These laws were repealed, indeed, by the National Assembly, and the most mischievous consequences ensued, until the Code Napoleon was established, in 1807. The people of India, who had no usury laws to protect them, suffered miseries from this source, which he would not pretend to paint to the House, and which, in fact, it was beyond the power of language to describe. Money was not lent out at interest by the year in India, but by the month, the week, and the day, and the wretchedness which this system produced was beyond all conception. Another country, whose whole government was a system of policy founded on the deepest knowledge of human nature, he meant China, while it allowed a rate of interest which in effect amounted to a repeal of the usury laws, adopted a very salutary regulation, which restrained the injurious effects which might otherwise arise from such a system. The Chinese allowed a rate of interest at 2½ per cent per lunar month, or 33 per cent per annum; the consequence of which was, that property was thrown into the hands of a few wealthy monopolists; but then, if the borrower was unable to pay, they did not allow the lender to imprison him, but he might insist upon the punishment of the debtor, provided he, the creditor, submitted to double that punishment. If the House abandoned the usury laws, some such measure as that adopted by the Chinese ought to be resorted to in this country, in order to protect the unhappy borrower from the extortion and cruelty of the usurer; for usurers had in all times been cruel, and it was the nature of avarice to be callous and merciless.—The evil arising from usurious contracts in annuity bonds had been alleged as a ground for the repeal of the existing laws. Mr. Preston, however, had stated, in his evidence before the Committee, that while mortgages on land amounted to many millions annually, the amount of money lent on annuities for lives, did not amount to more than one million a year. There was one year, indeed, in which Mr. Preston remembered five millions to have been lent on annuities; but this was a solitary instance: This argument, therefore, afforded no ground for the repeal of the usury laws. It was said, that the interest of money was now below the legal rate of interest. This was true with respect to considerable capitalists but it was not true with respect to the lower and middling classes of people, and these classes would be the great sufferers by a repeal of the usury laws. He was convinced in his own mind, that the people of this country did not believe that the House would listen to a proposition for their repeal, and that if they had supposed it would have been entertained for a moment, the table of the House would have groaned with petitions against it. He begged leave to call the attention of the House to evidence which was much better than his own; he alluded to that of Mr. Rothschild, a man whose knowledge of this subject was as sound and practical as the goodness of his heart was exemplary, and whose opinion could not fail to have great weight. If there was one man in the kingdom who was more likely than another to derive pecuniary advantage from the repeal of the usury laws, it was Mr. Rothschild. Yet, what was the opinion which he had delivered before the Committee? He had declared, that he thought the operation of the usury laws, as bearing on the value of money in England, of great importance to tradesmen. Small tradesmen and manufacturers in this country possessed many advantages which were unknown on the continent, by drawing bills at a short date on their friends and connexions, which were negociable at the legal rate of five per cent interest. "If the usury laws were repealed" continued Mr. Rothschild, "it was impossible to say what might be the consequences to this class of tradesmen; the probability was, that they would be under the necessity of resorting to some lender, who would not accommodate them at less than two or three times the legal rate of interest. Should the House unhappily be induced to repeal those laws, evils incalculable must be the effect, even before parliament would have the power of re-establishing the antient system. Let the House recollect the reputation and the efficiency which had characterised this country, under all the difficulties with which it had had to contend. He would therefore implore them not to abandon such solid ground for a system, which, wherever it was introduced, debased the character of the nation, and sacrificed the interests of the many to the few. He should therefore move as an Amendment, "That the Bill be committed on this day six months."

Captain Maberly

observed, that in rising immediately after the hon. member who spoke last, it was not his intention to follow him throughout the very remote and barbarian retrospect which he had taken. In legislating under the present state of Public improvement, he should restrict Himself to the consideration,—were these laws which the bill went to repeal just and, politic? and, if they were just and politic were they efficacious? He would ask the hon. member, or indeed any supporter of the usury laws, this plain question—could the government know the interest of the parties in any contract as well as the parties themselves? If it was true, as the hon. member had assumed, that the borrower was always at the mercy of the lender, and that such mercy was denied unless the law interposed, how was it that the interest of money at that moment was below the legal rate? But, said the hon. gentleman, a very great injury would be inflicted by the repeal of these laws. Now, if such would be the result, it must be evident that the passing of those laws had imparted to that interest a very great benefit; then, why should any distinct class in the country derive a partial benefit, from any law at the expense of other classes? What would those who hold a contrary opinion say, if there was a law introduced which expressly provided against the raising of rents? That House had entertained even such a proposition for, in 1797, Mr. Main waring had submitted a measure to prevent regrating and forestalling in the buying of cattle; in other words, to prevent the rise of prices in the sale of cattle; and Mr. Alderman Combe had supported the measure on the principle, that when a maximum was put upon money, why not also put it upon other species of property? But, allowing all that was said in favour of the principle of these laws, how could their continuance be considered useful, if they were proved not to be efficient? And, that that was the case the House had the fullest evidence. The fact was to be traced in the practice of borrowing money in continuation and in those ruinous annuities which had had such a fatal extension. With respect to the constitution of the Committee, and the evidence adduced before it, he must say, that he never met a more conclusive mass of information than was to be found in their Report. Agreeing with them, he should give his decided support to the original motion.

Mr. Alderman Heygate

observed, that although indisposed, he was most anxious to offer a few observations on the present question. It was said by the advocates for the repeal of the usury laws, as stated in the report of the committee, that at that time the alteration would produce no great effect. That was stated on the 30th of June, 1818; and its fallacy was esta- blished by the fact, that if the repeal of the ancient law had been then effected, within two months after that period the most prejudicial and fatal effects would have followed. And these effects would have ensued, not from any political occurrences, not from war, but from certain alterations in the currency of the country. He knew well the great stress that was laid upon the authority of the witnesses—men who recommended this change. With every disposition to give them due estimation, he would still request the House to recollect that they were composed of great lawyers and great capitalists. Now, though disposed to attend to their opinions with every deference on many subjects, on the usury laws they were not the very authorities which he should select to guide his judgment. And, as to committees of that House, he must also be allowed to say, that even their reports should be viewed with great circumspection. He spoke under correction; but, what was the general impression in appointing them? The courtesy of the House gave a committee generally on subjects not political, to any honourable member. As was natural, the mover placed upon that committee those individuals whom he considered favourable to his own view of the subject, with a few other persons interspersed to give a colourable impartiality to the appointment. And, as to the evidence generally produced, he, long before he had the honour of a seat in that House, had reason to know the principle on which testimony was sought. He had been asked to give evidence before parliamentary committees. In answer he had stated, "My opinion is quite different from yours on that subject." "Oh then," said the individual who wished in the first instance for his testimony, "for God's sake, my dear friend, stay away" [hear, hear!]. One passing? observation he begged leave to make on the witnesses produced before the committee, whose report recommended the repeal of these laws. Twenty-one witnesses had been examined, eight of whom were the greatest capitalists in the country; with a number of attorneys, whose engagements were chiefly in annuity practice [no, no!], and bill-brokers of immense wealth. He knew the parties well; and without making any unjust and undeserved reflection, these he knew were the individuals who gave the constituent parts of that evidence. But at least one fact was to be found esta- blished in their report, and it was this—that usury laws were in force in France, in Holland, and in Prussia; and what will the philosophers say, when it is recollected, that it was and is recognized by the Code Napoleon itself? If we compared England with those nations where no such law existed, it would be found, that while they had become degenerate and debased, this country had maintained her prosperity, her reputation, and her strength.—Then, it had been asked, in what consists the use of laws whose provisions can be evaded? The answer to such an objection was, that there never was a law or laws which human ingenuity could not evade and, therefore in estimating the force of such an objection, we were bound to compare the cases of evasion with the mass of instances in which these laws were complied with [hear, hear!]. That, in a variety of instances in this metropolis, these laws were often evaded, but in the great mass of business in the country they were obeyed and respected. In what a difficult situation would trustees be placed under such a system; at present trustees had the security, under the protection of the law, of getting 5 per cent for trust-money. But change that system, and you leave no defined course for a person thus situated to pursue. Whatever course he should adopt, he will be subject to the imputation, either from the minor, when arrived at maturity, or the old lady, that other persons had seven, eight, or nine per cent for their money, and why had not they? If was to be recollected, that there was no market in this country for money as for corn and other commodities. The greatest confusion must be the result. Next, with respect to mortgages. Suppose a scarcity of money in a period of war, in what way, under the repealed system, would their interest be affected? After having at a vast expense for stamps, &c. submitted the title deeds, they would be placed at the mercy of the lender, and obliged to make an arrangement at 9 or 10 per cent. But then it was said that in theory the proposed repeal was well founded. He would not argue that proposition generally. There were, however, many things, which, though untenable in theory, were found to be most salutary in practice. Who that looked at the constitution of that House could upon theory, defend it?—for instance two members for Old Sarum, and only two for Yorkshire,—but yet the thing worked well. He should say the same of the usury laws. Experience had proved them to be salutary. But he would ask on what grounds money was to be exempted from regulation by the State more than any other property? There was no abstract right either to hold or to deal in money. It was an artificial system, and was subjected to the regulations of the State. Besides it was untaxed; it did not, as dry money, contribute as land did to the establishment of the church, the poor rate, &c. It was also to be recollected that under the operation of these laws the government was enabled to borrow money on better terms, and the war was conducted at a lesser expense [hear, hear, hear!]. He knew that he had great authorities opposed to the view he took of the question, but he had the gratification to feel that he was supported by the concurrence of Adam Smith. He might also ask how it was if such a measure was considered beneficial, that not a single petition was forwarded in favour of the proposed change. One remark more, and he should finish—the measure would give, he feared, encouragement to those projectors from every part of the country who cared not in the furtherance of their views at what rate they obtained money to go on. Indeed, he had never heard of any one of that class, who, no matter whether the rate of interest was 10 or 20 per cent, did not consider the accommodation beneficial. Besides, the question was not, how the measure would affect the great monied men, but the small dealer who wanted accommodation. If a farmer went to a Country bank for money, what was to prevent the banker from charging him any interest he pleased The man, perhaps, was known but at that one bank; perhaps there was no other within a considerable distance. Again, with reference to the arrangements of government, could any man doubt that if the usury laws had been repealed twenty years back, the national debt would have been many millions greater than it was? we were now in a situation in which the repeal of the laws would perhaps do no great harm; but we should not count upon remaining in that situation for ever. As to authorities, they were not all on one side. There was a writer of the name of Adam Smith, whose talents were once as much renowned as any of those who had since written in favour of unrestricted usury. There was, however, one evil which he admitted in the existing law; it imposed its penalties with great inequality. The fine was treble the amount of the loan, so that the fine for taking 20l. too much upon a loan of 1,000l. would be 3,000l., while the fine for taking 50l. too much interest on 100,000l. would be 300,000l. This enormous inequality was highly objectionable, oppressive, and absurd. He pledged himself, should this bill fail, and no other member took up the subject to bring in a bill for the more equitable adjustment of the penalties of usury. He might be asked, why he did not support this bill, which would save all further trouble on the subject. There was; however, a great difference, in his apprehension, between doing away with laws which were essentially wise and well-founded, and doing away with absurd and oppressive penalties imposed under those laws.

Mr. Wynn

said, that the hon. alderman who had just sat down had, in the course of his speech, stated, that nothing was so fluctuating as the value of money; now, it appeared to him, that this was a strange beginning to a speech, the object of which was, to continue laws to fix the rate of interest. He was as indisposed as any man to make alterations in the existing laws on account of mere theory, but here there was a great practical evil. One of the justifications set up for these laws was their high antiquity. That, no doubt, was a respectable title; but, let it be remembered, that they had their origin in times, when our ancestors made it a practice to meddle and interfere in all transactions of buying and selling every article of provision. At that time it was not deemed beneath their notice to regulate the price of cloth, corn, and even poultry, and the one law he thought just as wise as the other. He was by no means a friend to innovation; but although he could not become a convert to the scheme of decimal calculation, still he thought it prudent to make those wise alterations which were consistent with the enlightened spirit of legislation, which characterized the present age. He would not adhere to an an dent law merely because it was antient, unless he also found that it was wise; he could not, for instance, recognise the policy of continuing a law, which enacts that, if a man commit a crime, not himself alone, but his entire family should suffer a penalty. The one law was just as old as the other. He conceived that a man with money had as good a right to dispose of it in the most profitable manner, as any other commodity. The hon. alderman had complained, that the committee, from which this bill had originated, was composed almost entirely of great capitalists and great lawyers; but surely this could be no objection; for the great capitalists must naturally be well acquainted with the question, and to what better authority could they refer than eminent solicitors; for if a gentleman of large fortune wanted to raise a sum of money, his solicitor would be the first person to whom he would apply? He therefore thought that these two classes were the very best from whom the committee could get information. Now, one of the arguments most frequently urged against the repeal of the usury laws was, that it would encourage extravagance, and that young men would sink their estates before they arrived at years of discretion. But, he would ask, was there the least difficulty for any man who was extravagantly disposed to raise money to an amount infinitely beyond any thing he could ever have hopes to repay. If a man were disposed to pay excessive interest, he did not think the raising money, in the least degree, more difficult now, than it would be if the law were repealed. Could not cases be mentioned where individuals without any property beyond perhaps 20,000l. had been able to raise money to the amount of half a million, to carry on particular projects? The right hon. gentleman then recounted particular cases of the difficulty arising from the existing laws relating to mortgages and annuities, and mentioned one, in which a gentleman of real property, but who had occasion to raise money, and had not been able to obtain it by way of mortgage, was compelled to pay 10 per cent by way of annuity. The worthy alderman had appealed to the authority of Adam Smith, and seemed to place great reliance upon his opinion. Now, he would not deny, the eminent talents of Dr. Adam Smith; but he must in candour confess, that his argument had been for ever overturned by Mr. Jeremy Bentham, in a work of as much ability as ever was displayed by the head and pen of man. It was, perhaps, the most perfect specimen of logical accuracy, in all its parts, that ever was written; and he had it from an authority so high, as to place it beyond all doubt, that even Adam Smith confessed himself mistaken. He was convinced that the time was come for the abolition of those absurd statutes which incumbered the books.

Mr. Calcraft

said, he was perfectly sensible of the disadvantages under which the House discussed this question at so late an hour of the night; and he confessed he was some what surprised that when a few nights back, five of his majesty's ministers had voted on this important question, they had not thought fit to favour the House with their presence this evening. It appeared to him, that it would have been much more satisfactory to this House, as well as to the country at large, if, when they meant to support it, they would make it a cabinet measure; for he felt persuaded that no subject would be brought forward during the present session, that affected more extensively and deeply the interests of the community at large. He confessed that he expressed his opinion on this question with great apprehension, because he differed always with regret, from his hon. friend near him (Mr. Baring), whose extensive knowledge and great practical information, gave to his opinions such weight on these questions. But, when he looked to the evidence of history, his opinions acquired additional strength. He there found that for the last three hundred years the country had prospered under the system of Usury Laws, and he found that at each successive reduction of interest our prosperity had increased more and more, according as it had been regulated by statute. All the great writers on this subject recognised the value of each successive reduction from Henry the eighth downwards till the time of Anne, when the interest was settled at five per cent.—And now he would come to consider the consequence' of the repeal of these laws, from which so much benefit had been expected by some gentlemen, but which he contended would be so detrimental. One of the very first effects of the repeal would be, to unsettle the minds of men, and shake all the securities of the country. All the lenders would immediately commence watching the variations of the money market, and the borrowers would be trembling for the bargains they had made, and would be in perpetual fear of the threats of the lenders. It was very true, as had been said, that engagements were made for a term of years; but was it probable that henceforward any capitalist would be so foolish as to lock up his money for a term of vears? His right hon. friend who spoke last, had said, that, much as he was opposed to change, still he could consent to an alteration of the usury Laws—and why? Because, he said, he had discovered a practical grievance, which would justify their repeal. And, what was the great practical grievance? The difficulty which the landed interest found in borrowing money. Now, it might be very true, that, in times of unparalleled difficulty, when government was borrowing money to a greater extent than ever they had done before, or ever would do again, that which was called a practical grievance, certainly did arise—the landed interest could not borrow money on mortgage. One instance had been stated by his right hon. friend, in which an individual was compelled to borrow at ten per cent. But, he would just ask this question—If you repeal those laws, are you sure that the landed interest, instead of borrowing on annuity at ten per cent, will not be compelled to borrow on mortgage at the same rate. Let the House recollect what was the evidence of the late Mr. Ricardo. He had said, that although government borrowed money nominally at 5 per cent, yet sometimes they paid 6 or 7, or even 9 per cent. Now, if government were compelled to borrow at 9 per cent, he should like to know what individual could borrow money on such advantageous terms? What gentlemen proposed to remedy by the repeal of these laws, was the exception, not the rule; namely, the case of those persons who, in times of difficulty, were driven to borrow at a disadvantageous rate. But, legislate as they might, the great proportion of annuity transactions would go on as at present, and they would destroy all the mortgage arrangements by this Utopian plan of remedying extreme cases. The error was this. They were endeavouring, by human legislation, to attain perfection. The thing was impossible; for they never could include in any one act of parliament all the cases which it might be desirable to provide for. And what do they do instead? They effected a measure, the consequence of which must be, to disturb all the mortgages and commercial transactions of he country. Was it probable that the great capitalists would embark their money in trade, when they Could get such profitable interest? No; they would remain behind the curtain: they would not undertake the burthen of trade, but they would lend but their money to adventurers at a high rate of interest, who would, by their skill, be enabled to derive, and be content to receive, a small profit. But, surely this must materially endanger the security of all commercial transactions. If it were possible that any serious mischief could be prevented by the repeal of these laws, that would be a good reason for enforcing the measure; but, as the country had flourished under these laws, he conceived they belonged to that class which should be continued. If authorities were of any value upon this subject, he might quote: the high opinion of Dr. Paley. The opinions of Adam Smith had been referred to, and he really was unable to say whether he had been confuted or confirmed by Jeremy Bentham; but he would just read the sentiments of Dr. Paley, which he considered of high importance. "The policy of these regulations is, to check the power of accumulating wealth without industry; to give encouragement to trade, by enabling adventurers in it to borrow money at a moderate price, and of late years, to enable the state to borrow the subjects' money itself." Now, it was possible the doctor might have been wrong; but he thought he was a substantial name to mention, when his hon. friend (Mr. J. Smith) said, he never knew a man, of sound understanding, who advocated the continuance of the system. He was one of the twenty-four stupid, and unthinking and prejudiced people, who opposed the measure, and he had had a very extensive correspondence on the subject, and could assure the House, that the question had excited great agitation in the country. Gentlemen were greatly mistaken if they supposed money was so plentiful in the country as it had been represented. It was supposed that plenty of discounts could be had at 2 and 3 and 4 per cent.; but, if a country gentleman were obliged to go to a country banker, he would be expected to pay 5 per cent, and he begged his right hon. friend, who had such a horror of innovation, to consider well before he gave so decided an opinion against the stupid, ignorant, prejudiced country gentlemen. However, certain it was, that they were all of opinion, that the measure would be detrimental.—He had said, that this measure would unsettle the minds of men; and as soon as the bill was passed, we should hear shouts of—"huzza!—success to usury." The character of the usurer, and the extortioner would no longer be disgraceful. It might be a vulgar prejudice, but he should lament to see our great capitalists become extortioners, or our eminent solicitors engaged in a traffic in which now they would be ashamed to embark; but then they would have the sanction and protection of the law. When this measure was passed, he should compliment his hon. and learned friend (Mr. Serjeant Onslow) on the glory he had acquired. His name would be handed down to posterity and would be immortalized, for having let loose all those salutary restrictions, which had been so wisely imposed upon the avaricious propensities of man. To him would belong the honour of having given free scope to the exercise of low, base, vile, grovelling, despicable avarice. That low simplicity, which lends out money at five per cent, would then be despised, and the man who would endeavour "to reduce the rate of usance" in London, would be scouted from all good society. If a man were to lend his money at five per cent, he would be accosted by his wealthy neighbour—"Why, you fool, don't you know serjeant Onslow's bill has passed. Pooh! five per cent indeed! you should get 6 or 7 per cent. at the very least. Why, you pay no attention to the enlightened measures of our parliament and administration. You may now take all the interest you can get, and mind—don't give the borrower time, and get from him all the interest you can, for 'the law allows it, and the state awards it.'" [hear, hear!]—The hon. member then proceeded to animadvert on the evidence received before the committee. He had been represented as a member of that committee. He found his name amongst the list; but he had no recollection of having attended its proceedings, although the learned serjeant had endeavoured to convince him, that he had cross-examined some of the witnesses. He could only say, that if that were the case, he was the only person on the committee who had done so, as would appear from the evidence. He considered the evidence of Mr. Preston, Mr. Rothschild, and Mr. Samuel Gurney, as of great importance. Mr. Gurney stated, that during the war he had never any difficulty in getting commercial bills to discount at five per cent. But, if another war were to take place, and these laws were repealed, he doubted very much whether Mr. Gurney would have that story to tell. Before the House passed a bill which affected the interests of the entire community, he thought it would be advisable to go more into detail, with a view to procure information, and that the House should institute a more solemn and extensive inquiry. He thought the measure of such importance, that government should make it their own and pass it, if it was to be passed at all, upon their own responsibility. He would put it to the right hon. gentleman opposite (Mr. Huskisson), whether that would not be the more proper course to pursued The right hon. gentleman might say—"I am here as a member of parliament, and as such I support it." He wished he could say so; but he saw how material a difference it made in the division the other night, when the chancellor of the Exchequer spoke in favour of the measure. In fact, these gentlemen could not divest themselves of their official character. In France, Prussia, and Holland, they had had the proof of the benefit of these laws; but the learned serjeant, notwithstanding his well-regulated mind, seemed disposed to imitate the ominous French Convention of 1793; for they declared, that money was a merchandise, and ought to be bought and sold like any other commodity. But the consequence was, that the declaration produced the greatest confusion in that confused country. And, how long did the House think the project lasted? The law was passed on the 11th of April, and it was repealed on the 4th of May. And this was the measure which gentlemen wished to introduce into this great empire, notwithstanding the experience they have had of it in an adjoining country. At that late hour of the night, he should not trouble the House any longer, but he would again recommend, that before this measure passed, the learned serjeant should again send it to a committee, which would institute a full and general inquiry into the whole subject.

Mr. Huskisson

said, he had been happy to hear the worthy alderman address the House with so much energy, notwithstanding his indisposition, although he could by no means agree with him in the view which he had taken of the subject. The hon. gentleman who spoke last had called upon him to state in what capacity he supported this measure, and had said that it should be brought forward as a government measure. But, it would be very strange if the government were to take it out of the hands of a gentleman who had had the management of the subject for years and who was peculiarly qualified, having been the chairman of the former committee. But, the hon. gentleman seemed to suppose, if it were not made a government measure, that all persons connected with government should be precluded from voting on it. Now, he sat there as a member of parliament, like the hon. gentleman himself, to discharge his duty to the country, to the best of his abilities, and he would be the last to describe any of those gentlemen who differred from him as dull, or stupid, or prejudiced. It was a subject on which men might very widely and very conscientiously differ, without deserving any opprobrious names. Because, after the best application he had been able to give to it, his opinions were in contradiction to those of the hon. gentlemen opposite, was that a reason that he should be taunted, as that hon. gentleman had been pleased to taunt him? The view that he took of the question was shortly this; but he by no means pretended to say that he must be right. He thought, that any law attempting to limit the rate of the interest of money was oppressive to those who wanted to borrow. The hon. gentleman thought the law advantageous to the borrower; and yet, by a strange inconsistency, he maintained, in describing the relative situation of the borrower and the lender, that the borrower was the party obliged to yield to the terms of the lender. The hon. gentleman had also alluded to the obloquy that attached to those who lent at a large rate of interest. That obloquy was, as the law now stood, an aggravation of the misfortunes of the borrower, who was obliged to pay the lender a premium, in order to induce him to submit to the obloquy. Nor was it obloquy alone for which the borrower was compelled to pay the lender. He was also obliged to pay for the whole course of evasion to which the existing law necessarily gave birth. From the evidence in the report of the committee of 1818—from all that he had observed in other respects—and from all the reflection which he had had an opportunity of bestowing upon the subject, he was perfectly satisfied, that the usury laws were oppressive and injurious to the borrowers of money. He was not much surprised that individuals connected with the landed interest should have expressed their dissent from the proposition for repealing the present laws. In the first place, the landed always felt a much greater indisposition to a change of any kind, than the commercial interest did. For his own part, however, he was convinced that the law, as it stood, must, in the course of years, put the interest of landed proprietors to great hazard. It was well known, that in consequence of these laws, it had become quite impracticable, during the late war, to obtain money by mortgage on land; and the consequence was, that the value of land had become unduly depreciated. But, finding so much indisposition on the part of the landed proprietors to agree to the repeal of the laws, he must say, that he attached so much value to the change in the law, by which it was attempted to regulate the value of money, that, if the gentlemen who had mortgaged their estates at five per cent, wished for a clause in the bill, providing that those mortgages should not be affected by the alteration of the law whatever he might think of such a provision, he, for one, would consent to its admission. Much had been said of the existence of laws similar to the usury laws in other countries. But, was there any resemblance between them? Did the usury laws in Holland empower any one to sue a man who had been guilty of usury, for penalties trebling in amount the principal which he had so lent on usury? All the advocates for the law talked of the ingenious evasions which took place respecting it. It was of those evasions that he complained. Those evasions were frequently ruinous expedients; and he charged the law with them. Adverting to the argument which had been used by an hon. gentleman, to show that those who derived their income from money matters did not contribute so much to the revenue as the landed interest, he contended, that nothing could be more opposite to the fact, and that he was utterly at a loss to conceive how any one could, for a moment, suppose that, from whatever source income was derived, whether from the land, whether from the funds, whether from commerce, or from whatever other quarter, it did not pay equally in taxation to the revenue.

Sir R. Heron

maintained, that the proposition of the hon. and learned Serjeant tended to reverse the policy and morality of our ancestors, and those of almost every nation in every age. It had been denied, that there were any usury laws in Holland and Prussia. In Holland he understood they had been repealed five and twenty years ago: and the fact was, that the country had never prospered since, although he did not mean to say that all the misfortunes of Holland were attributable to that circumstance. As to Prussia, it was well known that money transactions were not free in that country. If a man wanted to borrow a sum of money and another wished to lend it, they could not transact the matter between themselves, but must go to a government office, where the one party was fitted with a borrower, and another with a lender. He was persuaded, that if this bill should pass, it would greatly injure, if not ruin, the landed proprietors of this country. He was quite astonished to hear the President of the Board of Trade say it would benefit them. He did not imagine that any great injury would result to them in the present state of the money market, but if money again became scarce, the proposed repeal of the usury laws would affect them mast seriously.

Mr. T. Wilson

acknowledged, that his original opinions had been in favour of the repeal, but that the arguments which he had heard in the course of the present evening in opposition to it had very much staggered him. He thought, in the then state of the House, that it was by no means expedient to drive the question to a division.

Sir J. Sebright

expressed his perfect conviction that the law, as it now stood, was extremely injurious to the landed proprietor. As a landed proprietor, therefore, he expressed his thanks to his hon. and learned friend who had proposed its repeal. The fact was, that he had never heard but one good argument in favour of the usury laws, and that was from a friend of his, certainly no great political economist, who, in a discussion which he had had with him on the subject, exclaimed, "Why, every body knows that five per cent is the natural interest of money." But as, after all, this argument was not perfectly conclusive, he should certainly support the bill.

Mr. Baring

said, he was extremely unwilling to trespass on the patience of the House; but the question was one of such great importance, that he begged to be allowed to say a few words upon it. The opinion which he at present entertained upon it, was the opinion which he had entertained from the moment that he had been able to think at all; and he had not had the advantage enjoyed by the hon. member for London, of hearing any thing that night to alter his sentiments. The fact was, that the present was the first occasion on which the subject had been discussed. It was the first occasion on which they had heard a defence of the usury laws; and a defence, of which it was impossible to deny, that it contained some very cogent arguments. When it was considered, that all dealing in money was liable to great suspicion and obloquy, it would be evident that it was difficult to renounce prejudice, and to come fairly to the consideration of a proposition of this nature. He had had no share in bringing the present bill into the House; he was not a member of the committee on whose report it was founded; but it was before the House; and, convinced as he was that it would confer great benefit on every class of the community, he should certainly give it his support. One argument which had been urged by the opponents of the repeal was, that the lender had the command of the rate at which he would lend, and that the borrower was therefore at his mercy. No more so than the buyer of corn, or the buyer of any other commodity, was at the mercy of the seller. What was the case at this very moment? That, in consequence of not having any such compulsory power, the money-lender was obliged to come down to four per cent in his demand of interest. Upon the freedom of capital depended the freedom of all other branches of trade. If, therefore, the House were disposed to maintain free principles of trade—and the expediency of doing so could not be too strongly impressed upon them—they ought to be made aware, that there was nothing so necessary to the freedom of trade as the freedom of capital. Much had been said of the enormous usury that prevailed in India. The people in India had borrowed money from this country at 7, 10, 12 per cent. So much the better. What had been the result? They had been enabled to employ the capital thus obtained so advantageously that they now borrowed money at 5 per cent. The same principle would be applicable to Ireland. From the insecurity of property, or from some other cause, it so happened that there was a want of capital in Ireland. If, however, the interest of money were not limited to 5 per cent—if it might be contracted for on any terms, capital would flow into that country, and the most beneficial consequences would result. Whether, therefore, he reasoned on general principles, or on particular ca- ses, he was still persuaded of the importance of getting rid of the present system.

The question being put on the motion,

"That the Speaker do now leave the Chair, the House divided, Ayes 43. Noes 34. the House then resolved itself into the committee; after some verbal amendments hail been agreed to, the Chairman reported progress.