The Sun.
London, England, 1855-12-13 00:00:00

" deliciou „, dream," has to guess and wonder
whether we shall get over the 4th of each month
without the suffering and humiliation of vast in-
solvency ; to watch with sleepless vigilance the
condition of the gold in the Bank coffers, to be
racked- by hope and fear if the arrivals from Aus-
tralia bo delayed a week ; to be agonised by an
east wird. All because wo persist in staking our
existence on the possession of gold, and at the same
time in supporting a law that renders it impossible
we should permanently retain it.
I say the law prevents the possibility of our
keeping possession of the gold.
Gold money and paper money will not for any
length of time circulate together at equal values.
There are two distinct values in the coin—the ,
egal tender value and the metallic value, and these 1
elo not coinciie, but vary inversely to each other.
Thus, supposing a large quantity of metal to be
taken up by the Mint to be coined and issued, the
bullion would become scarcer and rise in value,
While the legal tender would become more abun-
dant, fall in value.
At Melbourne when coin had become very
scarce, an ounce of coined gold actually commanded
en ounce and a third of uncoined gold of equal
fineness.
While the monopoly we have assigned to gold
raises its value as metal, the issue of legal tender
paper, making legal tender more abundant, lowers
the value of the legal tender. The price of the
gold being fixed by the law which binds the Bank
to take all the gold offered at 3/. 17s. 9d., and to
pay it out at 3/ 17s. 10d., this alternation in value
of money in, for a time, only indicated by the rise
in value of all other articles. This rise stimulates
large exports. The importer looks around for his
returns, all commodities have risen. We are under
no engagement to supply iron, lead, tin, or any
other article at a fixed price, except gold. We
thus bribe the foreigner to take our gold instead
of our goods. The gold being gone the Bank is
compelled to redace her issues of paper. Eight
hundred private and joint-stock banks are instantly
afflicted with the cramp, and seek to lock up the
remaining money by increasing their reserves.
Now, as unreduced debts cannot be paid by re-
duced money, this phasic of our system is equiva-
lent to a general decree of loss or insolvency against
all who by commercial enterprise have been con-
tributing to the welfare of the country.
Just at this moment the watchful Times advises
caution, recommends all to limit their transactions,
which means limiting employment, which is
limiting the life of the labourer. It is equivalent
to a proclae ation through the land, " Now get ye
to the workhouse or to your graves." No other
resource is left to the labourer thrown out of em-
ployment by this fatal system.
Even the press, the tardigrade press generally,
is beginning to inquire into a system which becomes
daily more incompatible with the advances of com-
mercial civilisation.
It is impossible much longer to bind industry and
its complicated divisions of labour down to barter
—nay, what is worse, to a monopoly of barter for
gold. Free trade will not tolerate this bondage.
The paper system, which the instincts and neces-
sities of the people have continually enlarged, can-
not longer be permitted to rest on the narrow basis
of gold, rendered unstable both by the law and by
the increased rapidity of communication with
foreign States. A foreign loan or speculation, a
short harvest, a telegraphic despatch, anything, in
short, may, by causing a sudden exportation of
gold, derange our whole commercial system. I
scarcely need recall to your mind how
frequent and fatal such panics have been,
how fertile of insolvency, misery end crimes,
and that in the depth of our ruin and the
triumph of our prosperity the amount of our wealth
was exactly the same, but disorganised by the failure
of our monetary system. It will be well for the
Times seriously to consider whether it will be be-
coming its rank and character to be the first to err,
the last to learn, in a matter so deeply involving
the interests of civilisation and humanity.
It is a vulgar error, that the value of legal tender
money depends on the obligation of the issuer to
redeem it in gold, or to redeem it at all, or to give
any security whatever.
The value of wheat depends on the fact that it
ministers to the great human necessity of satisfying
hunger. The value of legal tender depends on its
legal power of ministering to the equal human
necessity of satisfying debt, and in both cases those
values will vary exactly in proportion to their abun-
dance and scarcity relatively to the wants of man-
kind. To satisfy debt is the sole function of money
and the sole element of its value. Money ought
not to-be merchandise which can be melted and
robbed of its vital function as the canceller of debt.
Instead of " the promise to pay," which-appears so
simple and definite to the 9 imes, it is payment
which is more simple and definite still. The only
problem to solve is to maintain it in such quanti-
ties as shall be in harmony with the just require-
ments of industry.
What are the conditions we seek? The first and
most sacred right we have to protect is that of the
labourer to full employment. I have shown that
increased money of neeessity increases employment
and sustains prices. A sufficient issue of legal ten-
der money will give full employment to labour,
producing the greatest amount of national wealth,
and the money that produces the wealth will al-
ways be able to effect its distribution, securing the
greatest amount of national happiness.
In 1853, with abundance of legal tender money,
labour was fully employed in every branch through-
out the kingdom ; all the classes you have enume-
rated were happy, prosperous, and contented. Every
man was his own Chancellor of the Exchequer.
The air was everywhere resonant with the music
of gipsey parties of the labouring classes, there was
joy and contentment throughout the land, and the
workhouses were empty. The Bank of England,
under the compulsion of the law, reduced its issues,
and at the present moment the workhouses and
gaols are altogether insufficient to contains the
paupers and criminals ; our wealth and means of
wealth being identically the same, the derange-
ment of .our monetary system alone disorganises
every interest.
The Times has fulfilled many a mission of
humanity and justice ; I still hope it will look
more deeply than it has hitherto done into this
all-important question, and that it will enter its
powerful protest against the happiness of the
people being longer made the sport of an obsolete
'heory.—l am, Sir, your obedient servant,
J. C. SALT.