Lords Sitting of 16 July 1822

SMALL NOTES BILL.
The Earl of Carnarvon,on the order of the day for the third reading of this bill, rose to give the measure his support. If the passing of this act tended to throw an increased quantity of money into circulation, in so far its effects, would be beneficial. As, however, the notes of the country bankers were to be payable in gold, the bill could have this effect only in a slight degree. He did not think, therefore, that it would have any material effect in counteracting Mr. Peel's bill. It was the only measure which had been brought forward for the relief of agriculture. He should be told that that distress was caused by super-abundance of produce but he could prove that there was no superabundance. The noble lord then proceeded to quote from tables of prices current, the returns of cattle sold in Smithfield, the wheat in Mark-lane, and other documents, to show, that the state of the currency had alone influenced the rise, and fall of produce. When the circulation diminished, the prices were low; when it increased, they were high; and agricultural prosperity had fluctuated with the currency. The noble lord next quoted the prices of the contracts of provisions for the supply of Greenwich hospital, from 1744 to the present time, to show that transitions from war to peace had never before had any extraordinary effect, and that there was no such thing as high war prices and low peace prices. He then adverted to the increase in the price of wheat, which was principally governed by the quantity of circulating medium in the country. This was clear from a reference to the prices of 1814, and down to 1819, since which they had been declining, owing entirely, as he contended, to the financial operations of the country, particularly to those of the Bank during that period. Early in 1816, the government, owing to the then alarming depression of agriculture, and the failure of several of the country banks, increased the circulating medium by a large issue of Exchequer-bills, which at once relieved agriculture. Unfortunately, however, in 1819, came Mr. Peel's bill, which, by the immediate contraction of the circulating medium, affected and depressed the agricultural interests. If, by returning to the old standard, they had produced the evil, why not retrace their steps? Let them make one more change—let them divide the loss and the gain, and substitute a standard better suited to the capacity of the country as it now ex-

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isted. The committee of 1815 ought to have ascertained that the people could bear the weight of taxation under the pressure of the projected change in the currency. This measure if carried to its full length, would go to the confiscation of the whole landed interest. As to the supposed injustice of a revision of the standard to the public creditors, he denied that any such result could follow. With what grace could ministers talk of the inviolability of faith which they were ready to maintain with the public creditor, when they had already, by their arrangements respecting the sinking fund, taken from him the redeeming security which they had pledged themselves to uphold? If parliament separated without devising some measure of relief, the people would he left almost in a situation of despair. It needed but one or two seasons more under the present system, and every thing valuable possessed by the landowners and by the agriculturists would pass into the hands of other persons. He saw no remedy for the existing grievance short of parliament retracing its steps, and giving an increased measure of currency to the country.
The Earl of Liverpoolobserved, that the present bill was not at all contemplated in the view Are particular remedy for agricultural distress. With respect to those distresses, he never did consider that they were to be attributed to the change in our currency, effected by the return to cash payments. It was not one cause that was at work, but a variety of causes combined, all growing out of the greatest change that had ever occurred in the history of nations, within the memory of man. Who that contemplated the character of the late war could for a moment think of comparing the events of that war, and the state of things growing out of it, with the events and effects of any former war? He had never complained of over-production, nor did he undervalue the blessings of an abundant harvest. His argument was, that the artificial causes arising out of the state of Europe, had forced a great portion of the poor lands in this country into cultivation, the high demand at that period having insured to the cultivator a remunerating price. It was impossible that the profits of those who had so extensively cultivated the poorer soils, should not have experienced a great depression with the cessation of the war de-
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mand. The expenditure of the Victualling office alone was two millions, in the purchase of corn and cattle. Take such a customer out of the market, and a considerable over-production would remain on hand? When it was recollected, that from 1819 to the time he was speaking, there had been no foreign corn imported, and when to this was added the great increase of importation from Ireland, was it not evident that there must be a vast over-production? The noble earl had recommended a change in the standard of the currency, as a remedy for the agricultural distress. Let not the House conceal from itself the true character of such a remedy. Let it not disguise from itself that, whether by changing the standard, or at once diminishing the interest of the public creditor, they were in fact committing a partial act of bankruptcy. He agreed with Adam Smith, that states, if unhappily incapacitated from fulfilling their engagements, should act as honest individuals acted, who, when they were unable to pay 20 s. in the pound, exposed their affairs to their creditors, and gave up all they possessed in liquidation of their debts. Better at once adopt such a course, than resort to a depreciation of the standard of our currency. When these loans were contracted there was a positive stipulation, that after the termination of the war, the country should revert to its ancient standard. But, thought the agricultural interest sustained a great pressure, it was to be borne in mind, that the other great classes of the community had endured all the pressure of the war. True, there was a great change in the disposition of property; but he denied there was any diminution of the national wealth. One very important class might and did suffer; but, while the other great interests improved, that improvement made it certain that the suffering class would speedily right itself. There was no diminution of the capital, the skill, the industry, and talent of the country; and, seeing all these in full operation, he objected to any change which would put to hazard those great springs of national prosperity.
Lord Calthorpecontended, that there was in the machinery of the act of 1819, some unexplained obstacle, that counteracted that self-restoring energy which was the characteristic of this country under all its vicissitudes.
The bill was read a third time and passed.