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moment it was resolved upon, ng hu. tions calculated to effect their ob. man being was consulted as to its ject. From the speech of his hoeffects. They had, indeed, been nourable friend, and other evidence, asked about Mr Ricardo's system; he was induced to think that the and their answer was not one of the Bank wanted to resume cash paywisest, when they spoke about pay ments, but did not know how to put ing at the Mint price of the day. their wishes in operation. He had Mr Baring was the only person who heard it declared that the issues of had been asked a question on the paper had no effect whatever upon subject, and he distinctly stated, that the price of bullion. What supportit would not answer the purpose, ed this assertion, or were not proofs Ministers must, therefore, not be in direct contrariety to it? Now it much surprised, if they found the appeared that the Bank had failed plan rejected out of doors. If the to resume cash payments, year after claim of the Bank were allowed to year, although year after year called the extent of L, 10,000,000, not only upon by that House to do so. all ipdelicacy would be avoided, but was therefore high time that the the security would be greater; and matter should be taken out of their if Government were to be trusted at hands, and that the House should all without any guard upon their con- feel itself called upon to look to the duct, there was no occasion for the effecting of that measure. He did plan. He should therefore recom- not think this a question only bemend the amendment of his honour, tween the Bank and the Ministers; able friend, as most likely to con- but more between Ministers and the ciliate the public mind, and to allay Bank and the country, those alarms which had sprung, out therefore particularly disposed to of the bad management of the Chan- concur with his right honourable cellor of the Exchequer, and pro. friend in any measure which might pose, either that the amendment be be devised to keep the Ministers adopted, or that the House should also under control. One principle adjourn the further consideration of was clear, that those who had the this momentous question.
command of the circulating medium The Chancellor of the Exchequer of the country had the power of regumade a few observations, chiefly in lating the price of every commodity. answer to the animadversions of Mr This power clearly resided in the Tierney directed personally to him- hands of the Directors, as controlself; disavowed the distrust in the ling the circulating medium, and it Bank which had been ascribed to was a most formidable one. Why, him; and asserted that the object of then, putting the question shortly, his Majesty's Government was to re- for the application of the measure turn as soon as possible to cash pay- recommended by the Committee, ments; the only question being as the result was, that by withdrawing to the least inconvenient mode of a certain quantity of paper from the attaining that great and important circulation, we restored the remainobject.
der of it to the value of bullion, After a few observations from Mr which was to raise it 2 а
3 per cent. Manping, (a Bank Director), Mr He could not, however, go along Ricardo rose, amidst loud invita- with the right honourable gentleman tions. He said that he was one in his statement ; for in order to of those who conceived the resolu. raise the paper currency to the
value of a metallic one, there must minish their paper regularly. What be a demand for gold over and a. indeed he was afraid of was, that bove that actually in the market. they would reduce it too rapidly. As to the plan itself, undoubtedly he If he were to give them advice, he approved of it: for would they leave should counsel them not to buy any to the Bank Directors a power of bullion at present, but rather to sell keeping' out all the metals, and ma. it, and wait with patience till its king the currency consist of paper price should fall, as it then soon only? The Bank Directors could would, to the Mint price of L. 3, have no real interest in depre. 175. 10d. per ounce. He lamentciating the currency : it was theired the loss of that part of the oriinterest to raise it to double its va. ginal plan, which would compel the lue. They stood in the light of cre. Bank to purchase gold as well as ditors, not of debtors; they were to pay it on demand. He thought the last whom he should have ex- it might serve to operate as a check pected to object to the plan, and he against what might hereafter happen, thought no means so likely to suc- that was, against their starving the ceed as those before the House. circulation. Individuals might inThe Bank Directors, so long as they deed, by carrying gold to the Mint, continued to make large advances furnish an occasional supply to the to Government, must be liable to circulation. Mr Musheit, who had get into a situation of distress. They given his evidence with great premight extend their advances so far cision and ability, stated his opinion, as to quadruple the currency of the that with L. 300,000 always in the country. Their error was, in sup- Mint for coinage, about L.12,000,000 posing that the rate of interest would might be added to the currency withalways point out a proper limit to in the period of a year. He suptheir issues; but the rate of interest posed that this calculation implied, had been proved both by Hume and that the sum of L. 300,000 should be Adam Smith to depend, not on the constantly kept up by successive quantity of money, but on the profits quantities, and, besides, a year was a of stock; even though they did not long time to wait for such a supply, if advance any thing to Government, it were actually wanted. The Bank it was in their power, by an excess Directors could not possibly have of discounts, to make the circulation any desire to thwart the Goredundant. The proposed mode of vernment, and he did not think resuming payments appeared to him therefore that they would have obthe easiest that could be imagined. jected to the adoption of this part The Bank would be placed under of the plan. With regard to what no restraint at first, nor any sudden had fallen from his right honourable necessity of reducing its issues. An friend with respect to the graduated opportunity would be afforded of scale of payments, he might refer effecting the object in the most him to Mr Thornton's evidence, as gradual manner; and even when bul. indicative that no serious objection lion payments should be made at the was entertained against it. He Mint price, the inconvenience would confessed himself to be utterly asbe but inconsiderable. If the Bank tonished at the alarm which had managed discreetly, they might open gone forth, because a reduction, in 1820 with a very small issue of which was to raise the value of the gold : all they had to do was to di- paper to a par with gold, (the difference being now only 3 per cent. cramped in the same way, he must and the amount of the reduction, observe, that in 1796 the case was therefore, pot necessarily exceeding extremely different. The price of L. 1,500,000), was to be brought gold was then below the Mint price, about in the course of four years. He but a panic prevailed, and the Bank could only attribute it to the indis- was induced to lessen its issues. It creet conduct of the Bank Direc. had been asked, why should not the tors, and to the remonstrance which
poor man with only L. 10 get gold they had addressed to Government, for it if he wished, as well as the and in which they actually sounded rich man ? To this, he answered, the alarm. The honourable gentle that they did the same benefit to man (Mr Manning) had complained the poor man by restoring the whole of confidence being withdrawn from currency to its proper value, and by the Bank; but the House had not making L. 1,000 worth what it purwithdrawn it on account of their ported to be, instead of what it now want of probity, but on account of really was, worth only L. 970. Betheir ignorance of political economy. sides, the poor man, if he were very They had ample time and means of desirous of gold, might carry his being prepared to resume their pay. L. 10 note to a goldsmith's, and proments. But what had been their con- cure, with a very trifling difference, duct? They had continued their ad. the full proportion of what the Bank vances to the Chancellor of the Ex. itself paid. "To revert to the subchequer, in spite of the approaching ject of the advances to Government, period when the restriction was to ex- he must ask why were they made ? pire. Yet itwould be said that they had He could only ascribe it to the done this for the public interest'; but strong propensity to the Bank Dithe protection of the public interest rectors to act as Ministers. If they was not their business; it was that of would give up this anxiety about his Majesty's Ministers. The honour the State, and attend only to their able Director had talked of the ac. own interests, things would go on commodation which they had furnish. much better. A most fearful and ed to Government, and the sacrifices destructive depreciation had at one they had made at different times for time taken place, but from that we the country at large. Now he gave had recovered, and he was happy to them no credit whatever for those reflect that we had so far retraced sacrifices. It was their duty to at. our steps. We had nearly got home, tend to the business, and promote the and he hoped the right honourable interests of the Bank proprietors. gentleman would lend them his asHe had been much astonished at the sistance to enable them to reach it small amount of their savings, having in safety. He would venture to previously conceived that it was at state, that in a very few weeks all alarm least L.5,000,000. This was now would be forgotten, and at the end explained; for they had thrown of the year we should all be surpri. away a million here and a million sed to reflect that any alarm had ever there, for the purposes, as it appear- prevailed at a prospect of a variation ed, of protecting the public. With of 3 per cent. in the value of the cir. regard to reductions in 1796, which culating medium. His own general the honourable Director had refere opinion was, that an unfavourable red to as a sort of warning that state of exchange must always prothe circulation might be hereafter seed from a redundant currency. If corn were imported and paid for limits by the length to which this in bullion, it was a proof that bule analysis has already extended, it only lion was the cheapest commodityremains to add, that, after a very Suppose all the Bank notes to be brief reply from Mr Peel, the apaid in gold, would not gold become mendments were withdrawn, and the infinitely cheaper? If our paper had resolutions put and carried without been of any intrinsic value, it would, a division. having become cheap from excess, Soon after this a Bill, founded on have been exported also, He the resolutions which he had prothought it right here to pay the posed, and so triumphantly carried, tribute of his approbation to the late was introduced by Mr Peel, and excellent regulations of the Mint, read a third time and passed on the He entirely approved of making gold 14th of June. the standard, and of keeping silver On the following day, Lord Lauas a token currency. It appeared derdale made a motion for obtaining to him to be a solid improvement in the opinion of the twelve Judges on the system of our coinage. Nothing the subjects of legal tender and could be clearer than that Govern, standard of value, and supported his ment had the power, by limiting the motion in a speech of considerable quantity, to regulate the value of ingenuity and learning, observing, the silver.
that he had been induced to call for At this stage of the discussion, a the opinion of the Judges in consemotion for adjournment was put and quence of what had passed in the carried; and on the following day late discussions respecting the Mint the House having again resolved it. regulations,wben it had been argued, self into a Committee on the Bank that, though these regulations ocReport, the adjourned debate was casioned a depreciation of silver to resumed. The first to call the at- the amount of 9 per cent., it could tention of the Speaker was Mr Al- be attended with no injurious effects, derman Heygate, who contended, because, from the year 1774 to 1779 at great length, against what he con- it had been declared, in a report of ceived the destructive and danger- the Privy Council, that silver coin ous tendency of the plan embodied had been depreciated 25 per cent. in the resolutions of the right ho- The noble Earl was answered by nourable gentleman (Mr Peel,) and Lord Liverpool, and after a brief which he believed to be founded on discussion the question was put and a total misconception of the princi- negatived. ples by which our currency is, or, at On the 16th of June, Mr Peel least, according to him, ought to be moved for leave to bring in a bill, regulated. The worthy Alderman in terms of the recommendation of was followed by Sir H. Parnell, Mr the Secret Committee, to establish Gurney, (member for Norwich,) farther regulations respecting adLord Folkestone, Mr Cripps, Mr vances by the Bank of England upMarryat, Mr Abercromby, Mr J. on Government securities; and afSmith, Mr Pearse, Lord Castlereagh, ter a few words from Mr Ricardo, &c.; but as no views either novel or the Chancellor of the Exchequer, interesting were elicited in the Mr F. Lewis, and Mr Huskisson, course of the adjourned discussion, leave was given to bring in the bill which was protracted till a very late accordingly. hour, and as we have exceeded our On the 18th, the Cash-payments Bill was read a second time in the necessary : he would propose to alLords, and committed on the 21st, ter another date, that of February to when a lengthened discussion took November next, for the commenceplace, in which the principal speakers ment of the first step towards the were, the Marquis of Lansdown, and execution of the measure, His wish the Earl of Liverpool, who approv. in moving the amendment which he ed of the bill, and the Earl of Lau. did not expect to be carried, was that derdale who had opposed it in all its object should appear in the Jourits stages.
nals. It would then be seen that The bill was however read a third there was one of their Lordships who time on the 23d, when Lord Holland was desirous that the resumption of rose to move an amendment, with re- cash payments should not be postspect to the period at which cash poned to so long a period as that in payments should commence. He the bill. The amendment was then objeeted to the remote date fixed for put, and negatived. the resumption, and thought it ex- The Earl of Lauderdale proposed, traordinary, after all that had passed that the clause for paying in ounces on the subject, that in the first session of gold should be so altered, as to of a new Parliament it should be re- render fractional payments in silver solved to continue the restriction on unnecessary. This clause, however, cash payments beyond the Ist of Ju- was not altered., ly 182O. He would therefore move The Earl of Harrowby observed, to substitute that date for the 1st of that the Bank would have a longer July 1823. Though he thus far ob- time to increase their treasure, if the jected to the mode in which it was clause of paying in coin at their opproposed to carry the object of the tion in 1821 had been omitted ; bus, bill into execution, it had neverthe- instead of proposing to leave out the less his approbation. It was with clause altogether, he would propose great satisfaction he saw at length a modification of it, which would alfully recognised those principles low the option of paying in bullion of finance which had always been or coin after May 1822, instead of maintained by those with whom he 1821, as now in the bill. aeted. Still, however, he felt for the The Marquis of Lansdown would character of Parliament; and when have preferred a total removal of the this measure passed, carrying with it restriction after 1822, as he was aa condemnation of the system which verse to the system of allowing the was abandoned, without being ac- Bank to pay in coin with the one companied by any censure of thật hand, and in bullion with the other. system, or any expression of remorse If that term had been fixed upon, he at the ruinous consequences which should have preferred in the interval had attended it, he could not help an exclusive payment in bullion. He doubting whether the public would would not, however, object to the believe that their Lordships were in amendment of the noble Earl (Harearnest with this bill. For this rea- rowby.) son he was desirous that the period
The Earl of Liverpool thought his fixed for the return to cash payments noble friend's amendment (the Earl should not be so remote. The amende of Harrowby's) would answer all ment he was now to move, if adopted, purposes that the bill had in view. might render some other alterations Hitherto the gold had come to the