The Sun.
London, England, 1853-09-14 00:00:00

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PRICE SD.

CORN, CURRENCY, AND COMMERCE.

The sunshine that we have basked in, is now darken-
ing with clouds. Bread is rising in price, and we are
menaced with scarcity. Our farmers,have grawn bar-
ley instead of wheat, Russia -has allowed the Sulina
channel of the Danube to be nearly choked up, and it is
with difficulty that supplies of grain can be shipped from
Ibeaila and Galatz. Louis Napoleon, alarmed'for the
stability of his throne, has become so enormous a pur-
chaser at Odessa that he has thrown up prices from 10 to
20 per cent., and fixed the price of the loaf throughout
France, indemnifying the bakers out of the public trea-
sury. Marshal Radetzky has prohibited the exporta-
tion of every kind of grain, and of their respectiveflours
and pastes from the Lombardo-Venetian provinces. A
royal decree of the Neapolitan Government dated Naples,
August 11, orders that "from this day, and through-the
whole of December of the present year, no customs'
duty shall be levied upon the importation into our royal
dominions beyond or within the Straits, of wheat, bar-
ley, oats, maize, pulse and flour, the produce of foreign
countries." These facts and precautionary measures, if
not signals of alarm, are at least symptoms
of anxiety.
The state'of the money market is as tiaitisfactory as
the state of the corn market. In the face of unprece-
dented importations of gold, derived from newly-disco-
vered mines, the Bank, alarmed at the drain on its bul-
lion, has been compelled to check it by raising discounts.
About this period last year it held in its cellars
21,852,000/. ; it now holds only 16,962,0001. ; the differ-
ence being 4,890,000/. On the 24th April, 1852, the rate
of discount was two per cent. On the Bth January,
1853, it was raised to two-and-a-half, and on the 22d
of the same month, to three per cent. On the 4th June
it rose to Sit per amt.* and on the Ist September to four
per cent. Thus it appears &sit fix the slibirferiod of
15 months the value of money, as tested by the rate of
interest, has been doubled.

Our commerce, as measured by our exports, has in-
creased at a most remarkable rate.

Value of Exports in 1832 ... £36,000,000
2, f 1842 ... ... 47,000,000
f Pf 1852 ... ... 78,000,000
This advancing movement has gone on with accelerated
velocity during the first six months of the present
year. As compared with the first six months of
the year 1852, there is an increase of ten millions, and
should this continue in an equal ratio to the close of the
year, then the aggregate exports of the present year
will reach the amount of 98,000,0001. In the twenty
years from 1832 to 1352, this commerce has been doubled,
nor is there any reason, under real free trade, why this
prosperity should not progress even more rapidly and
more extensively. As we enrich our neighbours we en-
rich ourselves, for if they are not in a condition to pur-
chase, all our efforts to sell must be vain. David Hume,
in his essay on the " Jealousy of Trade," clearly saw
this truth, concealed from the statesmen of the age in
which he lived, who upheld the prohibitory system in
the hope of becoming wealthy by impoverishing those
who were separated from them by rivers, mountains,
and oceans.

" Were such narrow and malignant politics," says
Hume, " to meet with success, we should reduce all our
neighbouring nations to the same state of sloth and
ignorance that prevails in Morocco and the coast of
Barbary. But what would be the consequence ? They
could send us no commodities ; they could take none
from us ; our domestic commerce itself would languish
from want of emulation, example, and instruction, and
we ourselves should soon fall into the same abject con-
dition to which we had reduced them. I shall therefore
venture to acknowledge, not only as a man, but as a
British subject, that I pray for the flourishing condition
of Germany, Spain, Italy, even of France itself. I am,
at least, certain that Great Britain and all those nations
would flourish more did their sovereigns and ministers
adopt such enlarged and benevolent sentiments towards
each other."
The sentiments or doctrines of David Hume are now
incorporated to a great extent in British legislation, and
we behold the results in the increased exports to which
we have referred. It is equally certain that our home
trade has also been prodigiously enlarged under our
more liberal policy ; but something more is required
than free ports to secure the expansion and uninter-
rupted course of prosperity of which we are tasting the
first fruits. Scarce and dear money will destroy all our
hopes, and this instrument of exchange is perfectly under
our control, albeit we have no control over harvests. On
the subject of currency we wish to call attention to
some remarks made by the City editor of the Times in
reference to the last rise in the rate of discounts. After
' assigning a variety of reasons, suggested by a fertile
imagination, for the drain of bullion, he decides that the
inconvenience will only be temporary; but we are bound
to give his own words, because, in some quarters, the
writer is looked upon as an authority :
" Under all circumstances, therefore, the conclusion is
evident, that the position of the country is safe in every
way, and that at no distant period a decided and steady
reaction from the existing condition of the money-mar-
ket is to be looked for. But this safety, and the early
prospect of greater ease, can be rendered certain only by
a rigorous adherence on the part of the Bank to the prin-
ciple of letting the currency contract with the efflux of
bullion, so as to increase the value of the capital which
is being extracted from us, until the inducement for the
drain shall be terminated by its becoming dearer here
than in other quarters. It may be hoped that the step
taken to-day will finally answer that purpose, but ano-
ther month must at least elapse, so as to admit of the
harvest question being entirely settled, before any confi-
dent view can be arrived at, and no doubt is felt that, if
the result desired should not speedily be attained a fur-
ther advance will be adopted without hesitation."
There is also another passage that must be extracted,
that we may have a complete view of his financial philo-
sophy :
"At the same time the call for extra circulation ren-
dered necessary by the higher prices of goods can be
continued only if the rise should go on, and, as it has
already obviously been beyond what can be accounted
for by the influence of the gold discoveries, there would
be no reason to suppose that this will be the case, even
if it were not rendered impossible by the present move-
ment of the Bank of England."
It is very evident that the writer of these opinions
has drawn his inspiration from the teaching of
Lord Overstone, whose pernicious errors, embodied
in the act of 1844, highly aggravated, if they did not
wholly cause, the panic of 1847, and which, ere this,
would have strangled the principle of free-trade had
not California and Australia come to the rescue. We
are told, in the first extract, that the bank must con-
tract the currency with the efflux of bullion, " so as to
increase the value of the capital extracted from us."
Here capital is used in a false and exclusive sense, being
limited to gold, without considering all other commodi-
' ties, of which gold is the most contemptible in the eye
of reason, though artificially exalted above all others by
an usurious and pawnbrokering legislation. To increase
the value of gold is to lower the value of all other goods,
so to maintain an absurd and spoliating system the pro-
perty of all producers is to be arbitrarily depreciated.
There is no mistaking this interpretation of the language
of the writer ; for in the closing paragraph of the second
extract it is avowed that a rise in prices " is rendered
impossible by the present movement of the Bank of
England ;" and at the end of the first paragraph that
"if the result desired should not be speedily attained, a
further advance will be adopted without hesitation."
Now the practical result of these tactics is to lower
prices, the consequence of which is to take away the
motives to production, and therefore to restrict trade,
both foreign and domestic. All this evil is to be in-
flicted to retain bullion in the Bank of England, and
forcibly uphold a system concocted by cunning, and as-
sented to by ignorance.
The working classes have lately enjoyed, and are still
enjoying, constant employment and remunerating wages.
How will this rise in discounts, threatened to be in-
creased, affect their interests ? hen money is abund-
ant and cheap, the class of employers extend their busi-
ness, and of course require more hands, but when money
becomes scarce and dear, they contract their business
and dismiss their workmen. To the class of employers
money is a tool with which they work ; but when the
tool becomes more and more expensive, they are
compelled to discontinue their operations. Now we
have seen that the value of money has been doubled
in fifteen months, therefore the lenders of the tools
have doubled their incomes, for they live upon interest
charged for the use of the tool. This tool they call
capital : and though they have not the audacity
of de-
nying, in plain terms, that houses, acres, ships, rail-
roads, docks, and commodities in general, arecapital,
yet, by using language in a false and deceiving sense,
they have duped large masses of the people into the be-
lief that gold money, the article in which themselves
deal, is, in a special and superior sense, capital par ex-
cellence; so of old, stupidity worshipped ed the golden
calf, and the priests looked on, laughed, and fattened.
And, in later times, Demetrius' persuaded' other dupes
to exclaim, " Great is Diana of the Ephesians," by say-
ing to them, " Sirs, ye know that by this craft we have
I our wealth ;"while the town-clerk told the people,
" that the city of the Ephesians is a worshipper of the
great goddess Diana, and of the image which fell down
from Jupiter." In this enlightened City of London a
similar superstition prevails, for it worships the image
which Mr. Huskisson set up, and which Mr. Jones
Lloyd polished into seductive attractiveness. There is
not a merchant in the City who does not experience a
secret tremor when he reads in the Bank returns that
the bullion is disappearing, and yet he knows that the
value of the bullion, when at its maximum, is an abso-
lutely insignificant fraction compared with the aggre-
gate value of commodities which form the material
wealth of the country. However, we are said to be
poor when we part with a few millions of gold, al-
though rich in all other things ; besides that, when we
do part with it, we receive an equivalent in exchange,
either in wheat or wine, tallow or wool.
This superstition having sunk deep into the commer-
cial mind, every nerve is strained to get back from fo-
reigners these cherished idols, called sovereigns. The
Bank raises its discounts, and the private bankers and