The Sun.
London, England, 1839-07-09 00:00:00

regard to the five millions. He was not, therefore, respon-
sible for the difficulty, and should not have been taxed
with the consequences of the loan. He thought he had
shown that the inquiry could do no good. He had not
ventured to undertake the defence of the Bank of Eng-
land, when there were other Hon. Members much more
conversant with the transactions of that establishment.
There might be facts and objections to the present sys-
tem ; but assuming all these he believed the inquiry could
not be entered into with any practical advantage, and not
without being productive of inconvenience to the commer-
cial public.—( Hear, hear.)
Sir J. R. REID said it was then 10 o'clock, and four
arcVa half more disagreeable hours he had never passed
in his life.—(Much laughter.) He regretted to have
heard so many and such general complaints against the
Bank of England, but considering the source whence
they came, he felt less than if they ha I emanated from
any other quarter. He was sure the House would not
wish him to go into any details at that late hour, but
as complaints had been made relative to the circulation
of the Bank, be held in his hand an account of the
notes in circulation for six years, from 1833 to 1839. It
was a curious circumstance how closely the amounts went
together. In the year ending
April 5, 1833 the circulation was... Xi 8,900,000
April 5, 1834 lB,-190,000
April 5, 1835, 18,500,000
April 5, 1836 18,400,000
April 5, 1837 18,300,000
April 5, 1838 18,300,000
April 5, 1839
That would show the House that the Bank was not the cause
of the overtrading which had taken place, although that
bad been attributed by the Hon. Member opposite to the
excess of issues. lie bad also the average amount of the
circulation for 13 weeks previous to and ending the sth
April, :833, up to 1839, and he found the sums were
19,400,0001., 19,300,0001., 19,600,0001., and indeed the
sums ran so closely that it was unnecessary to trouble the
House with them. The average amount for each year
ending the sth April, 1833, to 1889, were similar, and
varied only in a very slight degree, ranging from
18,100.0001. to 18,600,0001., 18,500,000/., 18,400,0001.,
&c. There was one observation of the Honourable
Member for Kilkenny which had exceedingly
annoyed him when he said that the Bank Directors were
instigated by private interests in a certain course they had
adopted. Now he did most firmly and at the same time
respectfully throw back that imputation with scorn—
( Hear)—having acted as he had done with twenty-four
Gentlemen, as high-minded and as honourable as any
others in the kingdom, he could not sit there and hear
any man living assert before the House and the country that
they were instigated by private motives.—( Hear, hear.)
Another statement of the lion. Member was that the
amount of bullion in the Bank did not exceed three mil-
lions That was not the fact. But he was not going to
tell the Hon. Member what the amount was.—( Hear and
laughter.) During 1836, when there was some ember-
rasments arising out of their American trade, he had stated
that it would be only a passing cloud ; he would repeat the
same expression in reference to the present crisis, if such it
might be called. The fact was, the balance of trade had
latterly been against them, and, as soon as exports took
place the money would be returned to them • and he had no
more doubt of seeing everything rectified before the Speaker
left the chair for the recess than he had of seeing the
sun rise the next morning.—( Hear, hear ) After the
very disagreeable discussion that had taken place, he
would not detain the House longer. But he did not hesi-
tate to say that the Bank of England were not in any way
to blame for the embarassments that had taken place, and
he could not permit the statements of the lion. Member
to go forth 1 o the public without making these few remarks
upon their incorrectness.—( Hear, hear.)
Mr. GROTE wished, in a few words, to explain why
he could not support the motion of his Hon. Friend for an
inquiry into the late conduct of the Bank of England. He
thought the inquiry of a Committee would be attended by
very salutary consequences; he thought there was much
to blame in it, but there was also much that appeared
blameable, merely because it was not understood—( Hear)
—but be could not conceal from himself that, at that late
period of the Session, it would be utterly impossible to enter
into such an inquiry as would prove at all satisfactory.—
( Hear, hear.) Had the motion been made three months
previously, it would have met with his support. The
Committee of 1832 tended more to promote discussion, and
to diffuse correct opinions upon the currency than could
possibly be done by pamphlets. It put the public in pos-
session of a large body of facts which were inestimable; it
was attended also with the important advantage that Mr.
H. Palmer, who held a very high station in the Bank,
laid down the principles upon which the Bank ought to
act. He was very sorry that those principles had been
so unwisely departed from.—( Hear.) In a great part
of what had fallen from his lion. Friend the Member for
Kilkenny he entirely concurred ; in others helcould not go
along with him. If the Bank were to adopt all of his
plans, they would manage worse than they did now.—
( Hear, hear.) For instance he could not agree in his
wish fur a uniform rate of interest on the principle of the
Bank of France; he (Mr. Grote) blamed them for a wish
to keep too near it, and for not taking more frequent ad-
vantage of an Act which was passed mainly at their insti-
gation, and which enabled them to raise the rate of inte-
rest when the state of the currency demanded it. He
believed they were chargeable with not contracting the
circulation when circumstances required it, but that did not
arise from interested motives, but because they, being all
merchants, and surrounded by merchants, from sympathy
they did not in time take those precautions which the state
of the currency demanded, and left it until much severer
measures were absolutely necessary.—(Hear, hear.) He
entirely went along with his Honourable Friend in
condemning the system of making large bargains to
supply country banks at a low rate of interest—such a
system put it out of their power to contract
the amount of the circulation at the point when it would be
most proper. A Committee baying plenty of time might
and would elicit much information on all these points ; and
he only wished the Session was not so far advanced, so
that all those points might be more fully explained. His
Hon. Friend condemned the advances made upon stock,
Exchequer bills, &c. He could not go along: with him in
that. He thought that, provided' they had bona fide se-
curity, it mattered not of what sort, the Bank was justified
if their advances did not make the circulation too large—
if they did not exceed the demands of the currency. He
must confess that the continued drain upon the Bank, il-
lustrated in a very clear and a very painful manner the
mischievous working of the Corn-laws—(Cheers)—and
he trusted it would cause reflection in the minds of those
wbo supported them. He believed that the Bank
and Joint-stock Banks—for in that case they were the
same—were much more largely accused than they de-
' served for causing fluctuations in trade. He believed that
though they exaggerated the evils they were very seldom
the originating causes of them. —( Hear, hear.) For these
reasons he was sorry he could not support the motion of
his Hon. Friend.
Mr. W. ATTWOOD said the Hon. Baronet, the Go-
vernor of the Bank, had expressed himself warmly in res.
pect of the charge made by the Hon. Member for Kil-
kenny, and justly so. He for one, and he believed he was
expressing the opinion of the mercantile community gene-
rally, must acquit the Directors of the Bank of any inte-
rested motives.—( Hear, hear.) He did not believe that
any considerable portion of the community held any other
opinion. The Directors of the Bank were chosen from
the most eminent of the commercial body—were well ac-
quainted with the mercantile interests, and were capable of
taking care of those interests. While he was not ready to
concur with the Hon. Member for Kilkenny in casting
censure on the Bank, yet he might have supported
the motion, if the Chancellor of the Exchequer had not
opposed it, and thereby throwing great responsibility on
those who supported it. He (Mr. Attwood) thought they
were indebted to the Hon. Member for Kilkenny, for
giving them an opportuuity of discussing a question that
was so important, and was o f opinion no complaint could
be made against him, either for making the motion itself,
or on account of the period of the Session, at which he had
brought it forward.__( Hear, hear.) The Chancellor of
the Exchequer had endeavoured to excuse the House for
manifesting an indisposition to listen to the Honourable
Member for Kilkenny, and had stated that while he
was speaking, the attendance of Members was very
slight. He ( Mr. Attwood) thought the Chancellor
of the Exchequer might have spared that excuse
if he had considered the manner in which debates, even
on the most important subjects, were attended to at the
time the Hon. Member for Kilkenny addressed the House.
—( Hear, hear.) The Chancellor of the Exchequer was
not justified, therefore, in saying the House had given a
tacit condemnation of the motion by the very slight attend.
ance of Members. He might have rested his opposition
on the other ground he bad taken—that no good resulted
from Committees of Inquiry on such subjects, although be
(Mr. Attwood) could not but recollect that most important
principles of legislation bad been stated in the facts that
had emanated from those Committees. Then the Chan-
cellor of the Exchequer had said the appointment of a
Committee would create distrust in the minds of com-
mercial men. If the affairs of the Bank influenced so
much the commercial world, it was far better that the
House should take cognizance of them than close the
Session without having had the subject brought un-
der its consideration. if there was any doubt as to the
adequacy of the bullion in the Bank to meet the demands
upon it, and the Directors should feel themselves bound to
take more stringent measures to meet those demands, let
the House consider what the effect of that would be on the
commercial world, and whether an., sliscussion could make
the matter worse. What was the present position of
commercial affairs as connected with the regulations
the Bank had thought it necessary to adopt after the
drain on its bullion ? He would take the liberty of reading
an extract from the " Bankers' Circular," a publication
frequently referred to, of the 21st June, which was this :
We have made diligent inquiry as to the state of busi.
ness among commercial parties, and the facts are that the
Bank of England refuses to discount bills that come through
the medium of Joint-stock Banks or speculators it corn
and cotton. Those commodities, as well as colonial pro-
duce, are marked for reduction in value." The meaning
of these expressions conveyed to every merchant was
this—that upon the stocks which they held they
must anticipate a loss of 15, or 20, or 25
per cent. The decision of the Bank of England was,
that in order to save the commerce of the country, it was
necessary there should be a fall in price. The restriction
of the circulation of the Bank would be a mere unmeaning
phrase, unless it were accompanied by a fall of prices, espe-
cially in connexion with bills of exchange.
Sir J. RAE REID assured the lion. Gentleman that
the Bank placed no restriction whatever upon bills of
exchange.
Mr. W. ATTWOOD was very glad to receive this as-
surance, as the contrary had bees circulated through the
country, and had appeared in almost every newspaper.
He believed, however, there wits & practical interdiction
plired by the Bank upon all bills offered for discount which
had passed through a Joint-steels Bank. Here lie desired
;t to be understood that he did not convey the slightest
personal imputations upon the Directors of the Bank. lie
knew tnooe gentlemen to be selected from the first mer-
chants in the City of London, and he alluded only to them
as illustrating the commercial difficulties of the times.
There In.d been a great deal of difficulty and distrust ex-
cited in the public mind towards the Bank by articles in

' newspapers, while the House seemed to be very indifferent
on so important a question. The Bank Charter must come
again under the discussion of the House in 1842 ; hut.
considering the magnitude of the interest of the question
it would not be at all premature if the Honourable Mem-
bers should already ‘!irect their serious attention to it.
A difficulty had arisen which might test the credit of the
Joint-stock Banks. It was supposed by registering the
proprietors of Joint-stock Banks against whom any cre-
ditor might proceed, a security would betiven which did
not attach to other Banks. But a case had arisen which
gave this a different character. A bank had suspended
payment, but the proprietors who were enrolled denied
their liability. That, therefore, was a new feature, which
might produce fatal consequences. There might be some
remedy against the person who had made the false enrol-
ment of the proprietors, but the creditors had no remedy
against the person who might be enrolled. He mentioned
this merely to show how great was the difficulty of legis-
lating on subjects of a novel character. One of the greatest
improvements which was thought to have been introduced,
was the principle of publicity in the accounts of the Bank
of England. It was said by those who introduced it
that the effect would be to render it impossible
that a difficulty should any more take place. Now he
would ask, had that effect been realized? and whether
there had not been reason to recollect the evidence of one
of the most influential witnesses examined, he meant Mr.
Rothschild, who was questioned before the Bank Charter
Committee, particularly upon the question of publicity.
He said it might be very well for the Bank to publish their
accounts, while their bullion was 10,000,0001., one-
third of their liabilities; but he should be very sorry to
be the Governor of the Bank of England, if he had to
publish an account when the gold in the Bank was below
5,000,000/ ; because he should be under great apprehension
of stopping payment, unless he had in his pocket at the
time an order from the Chancellor of the Exchequer to
stop his issuing any more bullion. The only other objec-
tion made to the motion of the Hon. Member for Kilkenny
was, that it embraced fifteen or twenty years, and that
theinquiry would be so extensive. During that time
many new measures had been proposed to the Houso,
and many measures had been adopted, the effect
of which was to prevent those violent fluctuations of the
circulation which were so much dreaded. The Hon. Mem-
ber for Kilkenny had some strong ground for imagining
that some blame was attributable to the Directors. He
( Mr. A.) did not say there was any blame attributable to
them, but he thought there were grounds for inquiry ; and '
though it might not be expedient this Session to proceed
to the inquiry, he trusted the House would not be insen-
sible to the present state of the country, and that at some
future period it would be prepared to take the subject into
its consideration, its order to place the finances and com-
merce of the country on a footing of stability and security.
The CHANCELLOR of the EXCHEQUER ex-
plained.
Mr. CL AY would briefly state his reasons for opposing
the motion of the Hon. Member for Kilkenny. Ile did
not wish to throw any blame personally on the Directors;
hut he thought there could be no doubt existing in the
mind of any man that very great mistakes had been com-
mitted by them, though not to the extent mentioned by
his Hon. Friend. It could no longer be matter of
doubt that they misunderstood their position in 1824.
In 1836, when moving fur the Committee on Joint Stock
Banks, he had warned the Directors and the public of the
difficulties which were likely to arise from their lending
Joint-stock Banks large sums of money at !ow interest,
and over which, when they had once parted with it, they
had no controul ; and he believed those difficulties had
already been felt. Considering the large demand for corn
which arose in this country last year, he was perfectly con-
vinced that the screw had not been applied in time. Evi-
dence of all those facts was already before the House, and
the Committee was therefore unnecessary, as was proved
by the fact that his Hon. Friend did not intend to call any
evidence, but meant to rest his case upon the documents
upon the table. Now he thought a Committee was for
the purpose of collecting information, not for digesting
that which was on the table. He believed that the errors
of the Bank arose from the anomalous functions which
they had to discharge. They were not in a proper posi-
tion to be the conservators of the currency, for they had to
attend to the interests of a large body of proprietors,
whose interests were diametrically opposed to those of the
public. Again, in their situations as men of business, sym-
pathizing with those around them, it was impossible they
could perform their duties as conservators of the currency
for the benefit of the public. for it was precisely when the
currency was in excess that they were called upon to in-
crease their issues. What was the remedy to be applied to
the evil ? There his Honourable Friend stopped. He
did not even hint at what was to be done.—( Hear,
hear.) The public, however, were beginning to take a
proper view of the case—they now thought the conser-
vancy of the currency ought to be in the supreme power,
and that whatever advantage arose from a paper over a
metallic currency should belong to the public, and he
trusted when the Bank Charter was next discussed that
the currency would be taken out of the hands not only of
the Bank but of Joint-stock Banks also. He could not
support the motion of his Hon. Friend.
Mr. E A STHOPE, while he did not profess to eulo-
gise the Directors of the Bank, at the same time he would
not blame them as the authors of those sufferings so feel-
ingly depicted by the Hon. Member for Birmingham.—
( Hear, hear.) Ths Directors were as honest and honour-
able a body of men as could be found in London—he did
not object to them, but he was determinedly opposed to
the system, and he hoped the time would soon arrive when
they, in a body, would refuse to remain in the ano-
malous situation they now filled.—(Hear, hear, hear.)
The Bank Directors must, under the present system, be
unable properly to discharge their duty to the public in
regulating the currency of the country. The public dis-
tresses had led to a discussion which might tend to a be-
neficial practical result, for it had been suggested that it
would be highly desirable to make the professed publicity
of the Bank proceedings a real publicity.—( Hear, hear.)
Who could doubt that Mr. Rothschild knew often the
amount of bullion in the Bank, and so conducted his pro.
ceedings ?—( Hear, hear.) And ought not every man of
capital and industry to have the same means of ascertain-
ing how to regulate his course?—( Hear.) The publi-
city should be clear and plain, without any mystification.
In respect to the expansions and contractions of the cur-
rency, the public must often necessarily suffer from the
situation of the Bank Directors; to regulate the currency
of a country like this, ought to be the duty of men
having nothing else to look to.—( Hear, hear.) The
Bank ought not to be one of deposit, and of issue also--
the two functions were incomratible. He should vote
for the inquiry, though he was afraid that not much
could be done this Session. He was glad to hear from
the Hon. Baronet (Sir J. R. Reid) that the present was
only a passing cloud; he trusted it might be so, but it
must be a painful thing for the Bank Directors so to
contract the issues, as to produce such general distress.
Mr. TURNER said ho was for inquiry, but feared that
in the the present Session it could lead to no practical result.
He was firmly convinced the Bank of England was safely
entrusted with the power it had, but he did not think it
had a right to single out any portion of society for its
victims.—( Hear, hear.)

Mr. WALLACE would vote with great satisfaction
for the motion of the Hon. Member for Kilkenny if
pressed to a division. In two previous Sessions the Hon.
Member endeavoured to effect the same object he was now
seeking to accomplish, but had always been met
with the objection that the proper time had not arrived
for the inquiry. There was every probability that
the Session would last four weeks more unless something
extraordinary turned up, and if the Committee was granted
the Honourable Member for Kilkenny would be able
before the conclusion of the Session to make out such a
case as would force the Government to take such steps as
were necessary for placing the currency on a sound
footing..

Stringers were then ordered to withdraw, and the
House divided. The numbers were—

For going into Committee of Supply 93
For Mr. Hume's motion..

Majority against Mr. Hume's motion-- -64
The House then went into
COMMITTEE OF SUPPLY.

Colonel SIBTHORP then rose to move for the re-
duction of the duty on Fire Insurance, when
The CHANCELLOR of the EXCHEQUER trusted
the Gallant Officer would not at present press his motion.
He wished now merely .to take such votes as were not
objected to.
Sir R. PEEL thought justice could not be done to
such a discussion at this late hour (1 2 o'clock). Perhaps
it would be better to bring the matter forward on the next
Supply night.
Colonel SIBTHORP was always ready to take
advice from this side the House.—( Hear and laughter.)
He would now be guided by the Right :lon. Baronet, and
postpone his motion, and bring it forward on the first Supply
day.

Mr. F. BARING then proposed a vote of 77,000/. for
the salaries and expenses of the two Houses of Parlia-
ment.

Mr. lIUME wished to have a detailed statement of the
expenses laid before the House.
The CHANCELLOR of the EXCIIEQUER said
this had never yet been done, and it would be incon-
venient for one House to interfere with the expenses of the
other.

Mr. AG LION B Y said this House had a right to know
the expenses, although it might not be proper to inter-
fere with them. They had a right to know the general
details of the expenses of the House of Lords as well as
of the House of Commons.

The vote was then agreed to, as were the following:-
48 0001. for defraying the expenses of her Majesty's
Treasury.
19,5801., the expences of the office of the Secretary for
the Home Department.
56,1171., the expences of the Foreign Office.
17,6781., the expences of the Colonial Office.
24,0001. for the expences of the Privy Council.
35,2351. for defraying the expellees of her Majesty's
State Office.
17,1201. for the expellees of the Comptroller of the Ex-
chequer Offiee.
Sir R. PEEL moved that a sum not exceeding 28,835/.
be granted as the annual vote for
idefraying the expences
of the British Museum. It was a .arger grant than before,
as 12,0001. was wanted for removing the Library to the
new building, and 1,000/. for arranging and printing the
new Catalogue. The Trustees hoped next year greatly to
reduce the expences.
In answer to Mr. NYSE, the Right Hon. Baronet
said, the Trustees now furnish copies of the Elgin Mar-
bles to any one who asked for them, at a price which had
been made extensively known. The Trustees did not wish to
profit by them, but they could not spend the public money
in
that way without the consent of the Treasury.
After a few words from Mr. O'BRIEN and Mr.
PRIME,
Mr. HUME asked what was to be done as to the en-
graving of the valuable collection of coins?
Mr. HAWES said the Trustees had memorialized the
Government, and he hoped a favourable view would be taken
of the application—to effect what would be a truly na-
-1 tional work.—( Hear, hear.)
The CHANCELLOR of the EXCHEQUER said,
the aub;ect was certainly one of great interest, but thy*