The Sun.
London, England, 1854-02-20 00:00:00

TO THE EDITOR OF THE MUN.

SIR,—It appears to me that now is the time when the
plan proposed by Mr. James Wilson, M.P., in the
Economist of 1847, and republished in his work on
" Cui rency, Capital, and Banking," may, with one im-
portant alteration, be adopted with great advantage to
the country.
We are on the eve of war,—money must be found for
carrying it on,—to raise it by loan would be to make it
dearer when commerce is already suffering by its being
too high— to raise it by fresh taxes would be put ing ad-
ditional weight on the springs of industry and checking
our onward course of commercial prosperity.—our flood
tide would be converted into an ebb tide. This may be
averted in a great degree by adopting in part Mr. Wil-
son's plan. He proposed to issue through the Bank of
England, or some separate department of issue, thirty
millions of one pound notes in exchange for thirty
millions of sovereigns, depo'iting ten millions of sove-
reigns and twenty millions of Government Stock as
a guarantee at once for their convertibility and
safety. Let the plan be so far altered as to substi-
tute the national guarantee for the actual deposit of
Government Stock, and the country will obtain twenty
millions with the least derangement to its commercial
and financial transactions. For a defence of the sound-
ness of the principles on which Mr. Wilson's plan is
based, I refer to his able and convincing arguments on
the subject. There is a prejudice in England against the
use of one pound notes, but it is a prejudice and nothing
else, arising from the discredit into which the one pound
notes of the country bankers fell in the panic of 1825,
and which panic was stopped by an issue of one pound
notes (accidentally found) by the Bank of England. In
Scotland they actually prefer one pound notes to gold,
and it is no uncommon occur' ence for a traveller on ten-
dering gold for payment of his bill at an hotel to be
asked for notes. And surely if the public can place
such confidence in the notes of a joint-stock company,
they will not have less confidence in notes which the
nation guarantees.

There is naturally and properly a jealousy against en-
trusting the Government with the power of i,suimg paper
money, a power that has in almost every instance been
abused ; but in the mode .recommended the power of
issue is limited—the operation cannot be repeated or
extended.

The very purpose for which the money so raised would
in a great degree be probably expended, in payments
abroad for the use of the army, would obviate the only
objection to which Mr. Wilson's plan in ordinary times
might be open ; for although, as he justly observes, it
would not add a shilling to the circulation, as circulation
adjusts itself to the requirements of trade—yet it would
increase the capital of the country, and tend to raise
prices ; whereas by its expenditure abroad, this derange-
ment wouH be avoided.

Should the war be happily averted, the same plan
judiciously gnd gradually adopted, would enable the
country to get quit of the taxes on knowledge, and to
liberate commerce still further.

If you can find room for the foregoing, you will oblige,
Sir, yours sincerely,
HAMER STANSFELD.
The Grange, Burley, near Otley, 15th Feb., 1854.