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Particular circumstances in the New Eng | immoderately fond of its modes, manufactures, land colonies made paper-money less neces and superfluities, cannot be restrained from sary and less convenient to them. They have purchasing them by any province law; begreat and valuable fisheries of whale and cod, cause such law, if made, would immediately by which large remittances can be made. be repealed here, as prejudicial to the trade They are four distinct governments; but and interest of Britain. It seems hard therehaving much mutual intercourse of dealings, fore, to draw all their real money from them, the money of each used to pass current in all: and then refuse them the poor privilege of but the whole of this common currency not using paper instead of it. Bank bills and being under one common direction, was not bankers' notes are daily used here as a medium so easily kept within due bounds : the prudent of trade, and in large dealings perhaps the reserve of one colony in its emissions being greater part is transacted by their means ; rendered useless by excess in another. The and yet they have no intrinsic value, but rest Massachusetts, therefore, were not dissatisfied on the credit of those that issue them; as with the restraint, as it restrained their neigh-paper-bills in the colonies do on the credit of bours as well as themselves; and perhaps they the respective governments there. Their be. do not desire to have the act repealed. They ing payable in cash upon sight by the draw, have not yet felt much inconvenience from it; er is indeed a circumstance that cannot attend as they were enabled to abolish their paper- the colony bills, for the reason just abovecurrency, by a large sum in silver from Bri- mentioned; their cash being drawn from them tain to reimburse their expenses in taking by the British trade: but the legal tender Louisbourg, which, with the gold brought being substituted in its place, is rather a from Portugal, by means of their fish, kept greater advantage to the possessor ; since he them supplied with a currency; till the late need not be at the trouble of going to a parwar furnished them and all America with bills ticular bank or banker to demand the money, of exchange; so that little cash was needed finding (wherever he has occasion to lay out for remittance. Their fisheries too furnish money in the province) a person that is obligthem with remittance through Spain and Pored to take the bills. So that even out of the tugal to England; which enables them the province, the knowledge, that every man more easily to retain gold and silver in their within that province is obliged to take its country. The middle colonies have not this money, gives the bills credit among its neighadvantage; nor have they tobacco; which in bours, nearly equal to what they have at home. Virginia and Maryland answers the same And were it not for the laws here, that repurpose. When colonies are so different in strain or prohibit as much as possible all lostheir circumstances, a regulation, that is not ing trades, the cash of this country would soon inconvenient to one or a few, may be very be exported : every merchant, who had ocmuch so to the rest. But the pay is now be- casion to remit it, would run to the bank with come so indifferent in New England, at least all its bills, that came into his hands, and take in some of its provinces, through the want of out his part of its treasure for that purpose; currency, that the trade thither is at present so that in a short time, it would be no more under great discouragement.
able to pay bills in money upon sight, than it The 4th reason is, " That every medium is now in the power of a colony treasury so to of trade should have an intrinsic value; which do. And if government afterwards should paper-money has not. Gold and silver are have occasion for the credit of the bank, it Therefore the fittest for this medium, as they must of necessity make its bills a legal tenare an equivalent; which paper never can be.” der; funding them however on taxes which However fit a particular thing may be for a they may in time be paid off; as has been the particular purpose ; wherever that thing is general practice in the colonies.-At this not to be had, or not to be had in sufficient very time, even the silver-money in England quantity; it becomes necessary to use some- is obliged to the legal tender for part of its thing else, the fittest that can be got, in lieu value; that part which is the difference beof it. Gold and silver are not the produce of tween its real weight and its denomination. North America, which has no mines; and Great part of the shillings and sixpences now that which is brought thither cannot be kept current are, by wearing become five, ten, there in sufficient quantity for a currency. twenty, and some of the sixpences even fifty Britain, an independent great state, when its per cent. too light. For this difference beinhabitants grow too fond of the expensive tween the real and the nominal, you have no luxuries of foreign countries, that draw away intrinsic value ; you have not so much as paits money, can, and frequently does, make laws per, you have nothing. It is the legal tender, to discourage or prohibit such importations; with the knowledge that it can easily be reand by that means can retain its cash. The passed for the same value, that makes threecolonies are dependent governments; and pennyworth of silver pass for sixpence. Gold their people having naturally great respect and silver have undoubtedly some properties for the sovereign country, and being thence that give them a fitness above paper, as a
medium of exchange : particularly their uni- be considered as a depreciation of the values versal esiimation ; especially in cases where of whatever remains in the country; then the a country has occasion to carry its money rising of silver above paper to that height of abroad, either as a stock to trade with, or to additional value, which its capability of exportpurchase allies and foreign succours. Other- ation only gave it, may be called a depreciawise, that very universal estimation is an in- tion of the paper. Even here, as bullion has convenience, which paper-money is free from; been wanted or not wanted for exportation, since it tends to deprive a country of even the its price has varied from 5s. 2d. to 58. 8d. per quantity of currency that should be retained ounce. This is near 10 per cent.
But was as a necessary instrument of its internal com- it ever said or thought on such an occasion, merce, and obliges it to be continually on its that all the bank bills, and all the coined silguard in making and executing, at a great ex- ver, and all the gold in the kingdom, were depense, the laws that are to prevent the trade preciated 10 per cent ? Coined silver is now which exports it.-Paper-money well funded wanted here for change, and 1 per cent. is has another great advantage over gold and given for it by some bankers: are gold and silver; its lightness of carriage, and the little bank notes therefore depreciated 1 per cent. ? room that is occupied by a great sum; where- The fact in the middle colonies is really this: by it is capable of being more easily, and more on the emission of the first paper-money, a safely, because more privately, conveyed from difference soon arose between that and silver; place to place. Gold and silver are not in the latter having a property the former had trinsically of equal value with iron, a metal not, a property always in demand in the colo in itself capable of many more beneficial uses nies; to wit, its being fit for a remittance. to mankind. Their value rests chiefly in the This property having soon found its value, by estimation they happen to be in among the the merchants bidding on one another for it, generality of nations, and the credit given to and a dollar thereby coming to be rated at 8s. the opinion, that that estimation will continue. in paper-money of New York, and 78. 6d. in Otherwise a pound of gold would not be a paper of Pennsylvania, it has continued unireal equivalent for even a bushel of wheat. formly at those rates in both provinces now Any other well-founded credit, is as much an near forty years, without any variation upon equivalent as gold and silver; and in some new emissions; though, in Pennsylvania, the cases more so, or it would not be preferred paper-currency has at times increased from by commercial people in different countries. 15,0001. the first sum, to 600,0001. or near it. Not to mention again our own bank bills; Nor has any alteration been occasioned by the Holland, which understands the value of cash paper-money, in the price of the necessaries as well as any people in the world, would of life, when compared with silver: they have never part with gold and silver for credit (as been for the greatest part of the time no higher they do when they put it into their bank, than before it was emitted ; varying only by from whence little of it is ever afterwards plenty and scarcity, or by a less or greater drawn out) if they did not think and find the foreign demand. It has indeed been usual credit a full equivalent.
with the adversaries of a paper-currency, to The fifth reason is, “ That debtors in the call every rise of exchange with London, a deassemblies make paper-money with fraudulent preciation of the paper: but this notion appears views.” This is often said by the adversaries to be by no means just : for if the paper purof paper-money, and if it has been the case in chases every thing but bills of exchange, at any particular colony, that colony should, on the former rate, and these bills are not above proof of the fact, be duly punished. This, one tenth of what is employed in purchases; however, would be no reason for punishing then it may be more properly and truly said, other colonies, who have not so abused their that the exchange has risen, than that the palegislative powers. To deprive all the colo- per has depreciated. And as a proof of this, nies of the convenience of paper-money, be it is a certain fact, that whenever in those cocause it has been charged on some of them, lonies bills of exchange have been dearer, the that they have made it an instrument of fraud, purchaser has been constantly obliged to give as if all the India, bank, and other stocks and more in silver, as well as in paper, for them; trading companies were to be abolished, be- the silver having gone hand in hand with the cause there have been, once in an age, Mis- paper at the rate above-mentioned; and theresissippi and South-sea schemes and bubbles. fore it might as well have been said, that the
The sixth and last reason is, “ That in the silver was depreciated. middle colonies, where the paper-money,
has There have been several different schemes been best supported, the bills have never kept for furnishing the colonies with paper-money, to their nominal value in circulation; but that should not be a legal tender, viz. have constantly depreciated to a certain de 1. To form a bank, in imitation of the gree, whenever the quantity has been increas- bank of England, with a sufficient stock of ed.” If the rising of the value of any parti. cash to pay the bills on sight. cular commodity wanted for exportation, is to |
This has been often proposed, but appears
impracticable, under the present circum- of commerce) is in a great measure, if not tostances of the colony-trade; which, as is said tally defeated. above, draws all the cash to Britain, and would On the whole, no method has hitherto been soon strip the bank.
formed to establish a medium of trade, in lieu 2. To raise a fund by some yearly tar, se- of money, equal in all its advantages, to bills curely lodged in the bank of England as it of credit-funded on sufficient taxes for disarises, which should (during the term of years charging it, or on land-security of double the for which the paper-bills are to be current) value, for repaying it at the end of the term; accumulate to a sum sufficient to discharge and in the mean time, made a GENERAL LEthem all at their original value.
This has been tried in Maryland: and the bills so funded were issued without being made a general legal tender. The event was,
On Coin. that as notes payable in time are naturally subject to a discount proportioned to the time; so The clamour made of the great inconvenithese bills fell at the beginning of the term ences, suffered by the community in regard so low, as that twenty pounds of them became to the coin of this kingdom, prompted me in worth no more than twelve pounds in Penn- the beginning of his majesty's reign to give sylvania, the next neighbouring province; the public some reflections on coin in genethough both had been struck near the same ral; on gold and silver as merchandise : and time at the same nominal value, but the lat. I added my thoughts on paper passing as ter was supported by the general legal tender. money: The Maryland bills, however, began to rise as As I trust the principles then laid down the term shortened, and towards the end re- are founded in truth, and will serve now as covered their full value. But, as a depre- well as then, though made fourteen years ciating currency injures creditors, this injur- ago, to change any calculation, would be of ed debtors; and by its continually changing little use. value, appears unfit for the purpose of money,
Some sections, in the foregoing essay of which should be as fixed as possible in its own principles of trade, might in this appendix, apvalue; because it is to be the measure of the pear like a repetition, have been omitted. value of other things.
I always resolved not to enter into any par3. To make the bills carry an interest suf- ticular deduction from laws relating to coin; ficient to support their value.
or into any minutia, as to accurate nicety, in This too has been tried in some of the New weights. My intention was, and still is, no England colonies; but great inconveniences more than to endeavour to show, as briefly as were found to attend it. The bills, to fit them possible; that what relates to coin, is not of for a currency, are made of various denomi- such a complex, abstruse nature as it is genenations, and some very low, for the sake of rally made: and that no more than common change; there are of them from 101. down to justice with common sense are required, in 3d. When they first come abroad, they pass all regulations concerning it. easily, and answer the purpose well enough Perhaps more weighty concerns may have for a few months; but as soon as the interest prevented government doing more in regard becomes worth computing, the calculation of to coin, than ordering quarter guineas to be it on every little bill in a sum between the made; ich till this reign had not been dealer and his customers, in shops, ware- done. houses, and markets, takes up much time, to
how judge by the late acts relating the great hinderance of business. This evil, to gold coin, that the legislature is roused: however, soon gave place to a worse; for the possibly they may consider still more of that, bills were in a short time gathered up and as well as of silver coin. hoarded; it being a very tempting advantage Should these reflections prove of any public to have money bearing interest, and the prin- utility, my end will be answered. ciple all the while in a man's power, ready for 1. Coins are pieces of metal, on which an bargains that may offer; which money out on impression is struck; which impression is unmortgage is not. By this means numbers of derstood by the legislature to ascertain the people became usurers with small sums, who weight, and the intrinsic value, or worth of could not have found persons to take such each piece. sums of them upon interest, giving good se 2. The real value of coins depends not on curity; and would therefore not have thought a piece being called a guinea, a crown, or a of it; but would rather have employed the shilling; but the true worth of any particumoney in some business, if it had been money lar piece of gold, or silver, is what such piece of the common kind. Thus trade, instead of contains of fine or pure gold or silver. being increased by such bills, is diminished; 3. Silver and copper being mixed with and by their being shut up in chests, the very gold, and copper with silver, are generalend of making them (viz. to furnish a medium ly understood, to render those metals more
durable when circulating in coins: yet air 8. 62 shillingsonly, are ordained by law to be and moisture evidently affect copper, whe- coined from 12 ounces of standard silver: now ther by itself or mixed with other metal; following the proportion above mentioned of whereas pure gold or silver are much less af- 15 one fifth to 14 one half, no regard being fected or corroded thereby.
necessary as to alloy, 65 shillings should be 4. The quantity of silver and copper so the quantity cut out of those 12 ounces. mixed by way of alloy, is fixed by the legisla 9. No everlasting invariable fixation for ture. When melted with pure metal, or ad- coining, can be made from a medium of the ded, or extracted to make a lawful proportion, market price of gold and silver, though that both gold and silver are brought to what is medium might with ease be ascertained so as called standard. This alloy of silver and to hinder, either coined gold or silver from becopper is never reckoned of any value. The coming a merchandise : for whenever the standard once fixed, should ever be invariable; price shall rise above that medium, so as to since any alteration would be followed by give a profit; whatever is coined will be great confusion, and detriment to the state. made a merchandise. This in the nature of
5. It is for public convenience, and for fa- things, must come from the general exchang, cilitating the bartering between mankind for ings, circulation, and fluctuation in trade, and their respective wants, that coins were in- cannot be hindered; but assuredly the false vented and made; for were there no coins, proportions may be amended by the legislagold and silver might be made, or left pure; ture, and settled as the proportion between and what we now call a guinea's worth of any gold and silver is in other nations; so as not thing, might be cut off from gold, and a crown's to make, as now is the case, our coined silver worth from silver, and might serve, though not a merchandise, so much to be preferred to the so commodiously as coin.
same silver uncoined. 6. Hence it is evident that in whatever 10. What has been said seems to be selfshape, form, or quality, these metals are, they evident; but the following calculations made are brought to be the most common measure on the present current price of silver and gold, between man and man, as serving to barter may serve to prove beyond all doubt, that the against, or exchange for, all kinds of commo- proportion now fixed between gold and silver dities; and consequently are no more than an should be altered and fixed as in other coununiversal accepted merchandise : for gold and tries. silver in bullion, that is to say in an uncoined By law, 62 shillings are to be coined out of mass, and gold or silver in coin, being of equal one pound, or 12 ounces of standard silver. weight, purity, and fineness, must be of equal This is 62 pence an ounce. Melt these 62 value, the one to the other: for the stamp on shillings, and in a bar, this pound weight at either of these metals, duly proportioned, nei- market will fetch 68 pence an ounce, or 68 ther adds to, nor takes from their intrinsic shillings the pound. The difference therefore value?
between coined and uncoined silver in Great 7. The prices of gold and silver as merchan- Britain is now nine and two thirds per cent. dise, must in all countries, like other commo Out of a pound or 12 ounces of standard dities, Aluctuate and vary according to the de- gold, 44 guineas and are' ordained to be mand; and no detriment can arise therefrom, coined. This is 31. 17s. 104d. an ounce. more than from the rise and fall of any other Now the current market price of standard golu merchandise. But if when coined due
pro is 31. 19s. an ounce, which makes not quite portion of these metals, the one t other, 1} per cent. difference between the coined be not established, the disproport will be and uncoined gold. felt and proved; and that metal wherein the The state, out of duties imposed, pays for excess in the proportion is allowed, will pre- the charge of coining, as indeed it ought: for ferably be made use of, either in exportation, it is for public convenience, as already said, or in manufacture; as is the case now, in this that coins are made. It is the current market kingdom, in regard to silver coin, and which, price of gold and silver, that must govern the in some measure, is the occasion of its scarcity. carrying it to the mint. It is absurd to think
For so long as 15 ounces and about one fifth any one should send gold to be coined that of pure silver in Great Britain, are ordained, should cost more than 31. 178. 10d. an ounce, and deemed, to be equal to 1 ounce of pure or silver more than 62 pence the ounce: and, gold, whilst in neighbouring states, as France as absurd would it be, to pretend, that those and Holland, the proportion is fixed only 14 prices only shall be the constant invariable and a half ounces of pure silver, to one ounce prices. It is contended that there is not a of pure gold; it is very evident, that our sil- proper proportion fixed in the value of one ver when coined, will always be the most ac- metal to another, and this requires alteration. ceptable merchandise, by near five in the hun 11. It may be urged, that should the legisdred, and consequently more liable to be taken lature fix the proportion of silver to gold as in away, or melted down, than before it received other countries, by ordering 65 shillings inthe impression at the mint.
stead of 62 to be cut out of a pound of stand
ard silver ; yet still there would be 4 per | in bullion or in coin, is a very narrow princent. difference between coined and uncoin- ciple; all the republics we know of, wisely ed silver; whereas there is but about 1. per think otherwise. It is an utter impossibility; cent. difference in gold.
nor should it ever be aimed at; for gold and On this we shall observe that the course of silver are as clearly a merchandise, as lead and trade, not to mention extraordinary accidents, tin; and consequently should have a perfect will make one metal more in request at one freedom and liberty,* coined and uncoined, to time than another; and the legislature in no go and to come, pass and repass, from one one particular country, can bias, or prescribe country to another, in the general circulation rules or laws to influence, such demand ; and fluctuation of commerce, which will ever which ever must depend on the great chain of carry a general balance with it: for we things, in which all the operations of this should as soon give our lead, our tin, or any world are linked. Freedom and security only other product of our land or industry to those are wanted in trade: nor does coin require who want them, without an equivalent in more, if a just proportion in the metals be some shape or other, as we should gold or settled.
silver; which it would be absurd to imagine 12. To return to gold: it is matter of sur- can ever be done by our nation, or by any naprise, that the division of the piece called a tion upon earth. guinea, has not been made smaller than just 16. From Spain and Portugal come the one half, as it now is; that is into quarters, greatest part of gold and silver: and the Spathirds, and two thirds. Hereby the want of nish court very wisely permits the exportation silver coin mnight be greatly provided for ; and of it on paying a duty, as in great Britain lead those pieces, together with the light silver and tin do, when exported; whereas hereto coin, which can only now remain with us, fore, and as it still continues in Portugal, pewould sufficiently serve the uses in circulation. nal laws were enacted against the sending it
In Portugal, where almost all their coin is out of the country. Surely princes by enactgold, there are divisions of the moedas, or 27 ing such laws, could not think they had it in shilling pieces, into tenths, sixths, quarters, their power to decree and establish that their thirds, halves, and two thirds. Of the moeda subjects, or themselves, should not give an and one third, or 36 shilling piece, into eights, equivalent for what was furnished to them! quarters, and halves.
17. It is not our intention to descend into, 13. That to the lightness of the silver coin or to discuss minutely, particular notions or now remaining in Great Britain, we owe all systems, such as “ That silver, and not gold the silver coin we now have, any person with should be the standard money or coin." weights and scales, may prove; as upwards “ That copper is an unfit material for moof 70 shillings coined in the reign of king ney.”. William, or dexterously counterfeited by false And “That paper circulating as, and callcoiners, will scarce weigh 12 ounces, or a ed artificial money is detrimental.” pound troy.
Yet as these doctrines seem to proceed from 14. All the art of man can never hinder a considering bullion, and money, or coin, in a constant exportation and importation of gold different light from what we apprehend and
and silver, to make up for the different calls have laid down, we will observe, + and balances that may happen in trade: for 18. That it matters not whether silver or
were silver to be coined as above, 65 shillings gold be called standard money ; but it seems out of a pound troy weight of standard silver; most nal, that the most scarce, and preif those 65 shillings would sell at a price that cious tal, should be the unit or standard. makes it worth while to melt or export them, 19. That as to copper, it is as fit for money they must and will be considered and used as or a counter, as gold and silver; provided it merchandise : and the same will hold as to be coined of a proper weight and fineness: and gold.
just so much will be useful, as will serve to Though the proportion of about 14} of pure make up small parts in exchanges between silver, to one of pure gold, in neighbouring man and man. states be now fixed, in regard to their coin, 20. That as to paper money, it is far from beand it is submitted such proportion should be ing detrimental ; on the contrary, it is highly attended to in this kingdom, yet that propor- profitable, as its quick passing between mantion may be subject to alteration : for this plain reason, that should the silver mines pro * As a general principle this is unquestionably true; duce a quantity of that metal so as to make but it must be general, or every nation with whom
commerce is extensively carried on, must alike adopt it, it greatly abound more in proportion than it or the principle immediately assumes an exceptionable now does, and the gold mines produce no
character; and nations liable to be effected by it must
provide means to counteract the effects of a sudden drain more than now they do, more silver must be of the usual circulating medium, because the absence of requisite to purchase gold.
a great quantity of the medium alters the price of ex15. That the welfare of any state depends change, of labour, goods, wages, rents, and the relative
exchange of current money, subsistence; and deprecion its keeping all its gold and silver, either ates all other property.