The Sun.
London, England, 1854-06-05 00:00:00

MON TEAGLE MOONSELINE.

Not wholly oblivious of some pungent reenarks nande
by Mr. Gladstone ou a recent occasion, to which he has
found it impossible or inconvenient to give'a direct re-
ply, Lord Monteagle has sought a battle-ground by an-
ticipating the future, and striving to demolish before-
hand a scheme which he attributes, with what justice we
know not, to the present Ministry. Until the matter
has undergone full discmsien—until everything has.been
heard which can be said on either side—it would be pre-
mature to pronounce decidedly as to what the future
relations of the Government and Bank of England should
be; but we may, at any rate, examine the arguments
adduced in favour of the present state of things, and de-
termine on what foundation they rest. Lord Monteagle
comes forward in the character of an optimist. The
present state of things is perfectly right, and any change
would, according to him, be rash, dangerous, unsound,
and empyrical. It is absolutely necessary, as he thinks,
for the preservation of public credit—for preserving our
metallic currency from debasement and our paper cur-
rency from over-issue—that we should continue, as
hitherto, to pay the dividends on the public debt, and
to receive our revenue as it accrues, not through the
medium of a public office, but through that of a joint-
stock company with interests utterly discordant to our
own, and pretensions which seriously impair the dignity
and curtail the power of Government in the management
of its own financial concerns. It is further necessary,-
according to the same high financial authority, that we
should pamper this favoured agency with all Manner of
exclusive privileges and lucrative preferences above the
other bankingestablishmentsofthe country, that weshoulcl
intrust to it the exercise of the prerogative ,of issuing
money, taking as security for such issue our own stock
held, by it, on which it receives interest from us—that.
is, in plain language,- that we should lend to- it for
nothing the money which we borrow from it at late-,
rest, and,tha,t we should, in ,further extension of this,
beneficent principle,, keep a large balance in its hands,
and, at fhe same time, pay interest to it for lending us
the said- balance. That this is all exactly as it should
be is Lord Monteagle's thesis ; let us see how he sup-
ports it.
In the first place, Lord Monteagle knows no instance
in which the management by Government of its own
monetary affairs has not ended most calamitously, the
inference being, of course, that a similar calamity would
follow if the English Government were to be so rash as
to meddle with this part of its own business. The in-
stance allecred by Lord Monteagle—the debasement of
the gold and silver coinage—is an unfortunate one, be-
cause it ,shows that,. in this respect, our Government
has been an exception and an example, and that, while.
other countries have tampered with their currency, we
have not. No doubt, if the coinage had been in the
hands of a minting company, enjoying all manner of
privileges and monopolies, there would have been found
Monteagles to allege that it would bedmpossible to pre-,
serve the standard of the coin if Government were to
take the manufactory into its own hands, but the fact is
the other way, and we have to thank Lord Monteagle
for suggesting an excellent argument against himself.
Lord Monteagle next demolishes a chimaera of his
own creation. He says it 'would be extremely dan-
gerous for Government to act as bankers and issuers of
paper money. We agree with him in the first part of
his proposition, but no one except Lord Monteagle en-
tertains such an idea. Government ought not to under-
take the business of a private banker, nor to enter into
competition with its own subjects ; we need no argu-
ment to persuade us of that ; but Government may, if
it think proper to do so, issue paper money, keep its
own cash, and p'ay its own debts with its own hand. The
first it virtually does already, for in issuing bank-notes
the Bank of England only acts as its agent, the sole dif-
ference being that the profit of the issue, which ought to
belong to the Government as representative of the public,
is wholly absorbed by the Bank. Why should it be
more perilous to issue money directly than through an
agent, and what danger there would be in desisting from
borrowing our own money we cannot imagine. Lord
Monteagle is afraid that, if Government took its own
monetary affairs into its own hands, it would be com-
pelled to abandon principle, and sacrifice its real practical
duties to a temporary expediency and to some exigent,
but partial interest. From this we are to infer that the,
present system of double management is free from such
objections, a proposition absolutely necessary to Lord
Monteagle's argument, which, with singular inconse-
quence, he demolishes himself, by showing how often the
Bank has been compelled to yield to the exigencies of the
Government, and how little the device of placing sound
principles under the protection of a joint-stock com-
pany has availed. The conclusion that the Bank is
no effectual barrier to a profligate Government is not
only proved by experience, but commends itself to
reason. Neither double action nor divided responsibility
' are favourable to a strict observance of principle. Men
will do through agents what they would not ,do directly,
and agents. will do for; their, principals
,what they dare
not do for themselves.
Lord Monteagle is not happy in his elusion to the
report of the Small Arms Committee. No doubt that
report is a compromise, and a compromise not very cre-
ditable to the body from which it emanated ; but it is
not, as has been represented, a refusal to undertake the
manufacture of small arms for her Majesty's army. On
the contrary, the report concedes the principle of a Go-
vernment manufacture, and recommends the introduc-
tion of machinery at Enfield, but does not wish it to be
carried to such an extent as to interfere essentially
with the profits of those contractors who have used their
power over the Government so unworthily. If we are
to follow out this precedent, we ought to have two
issues of paper money—one at the Treasury, the other
at the Bank—with a double apparatus fur paying and
receiving, and to ascertain which is the better by the
competition of the two methods. It matters not whether
the existing privileges were conceded with a corrupt
view to the interests of the Bank, or with a mistaken
view of the interests of the public. The result is in
either •case the same,' and we are not concerned with
motives, but with effects. Lord Monteagle states
that the principle established by the discussions of
1844 was, that it was impossible to have one central
bank of issue to manage the circulation. We appre-
hend that the possibility and desirableness of such a state
of things was the very principle on which , that act
was established, and vehich its provisions carried out.
In order to restrict the unbridled license of issuing paper
money, that privilege was confined to existing banks of
issue, and, still further to limit it, was restricted to the
amount of the issues of 1844. If the principle was not
established in all its integrity, it was because private
and personal interests intervened, not because any one
thought that the power of regulating the currency was
better placed in many hands than one. Experience had
abundantly shown that the mere convertibility of paper
into gold was not a sufficient protection against over-
issue. The currency should be elastic as well as conver-
tible—should contract and •expand with the efflux and
influx of the precious metals, and this it can never do
while a number of banks are concerned to fill up the void
left by the diminished circulation of others. The prin-
ciple that there ought to be a central issue of paper Tr oney
is, with all submission to Lord Monteagle, firmly esta-
blished by reason, by experience, and by authority ; but
we admit that this proposition is not decisive—nay, has
no bearing on the relations between the Government and
the Bank. Had it not been.for an oversight in Sir Ro-
bert,Peel's bill, which left the Bank of England without
any interest in extinguishing the issues of private banks,
we should, probably, ere this have witnessed the very
consummation which Lord Monteagle declares to be
impossible. Lord Monteagle's last argument is, that
the Bank of England is perfectly stable. No one that
we know of doubts the fact, and we are surprised that
it should be treated as a matter of , controversy. But
certainly its'stability and its utilityas a Government organ
are by no means increased by uniting the Government
agency with the operations of a private banking esta-
blishment, liable to loss like other establishments, and
actually involved at one time with American debts to
the amount of two millions. A. Government establish-
ment which shall issue paper money in exchange for
gold, and gold in exchange for paper, which shall receive
all that Government has to receive, and pay all that
Government has to pay, would possess every element
of security and economy, would expose public credit to
no danger, and would have several advantages pet:loer
to itself. The responsibility would be one and undivided.
The sum which would be found by experience to remain
as the permanent surplus of receipts over payments,
amounting to we know not how many millions, would
be available for the payment of debt or any other pur-
pose. There may be disadvantages sufficient, to counter-
balance these obvious recommendations, but, most as-
suredly, those disadvantages Lord Monteagle has entirely
failed to indicate.—Times.

THE CIVIL SERVICE-- TREASURY, • WHITEHALL.
Commissariat Department: Deputy Commissary-Gene-
ral Cowan and Deputy-Assistant Commissary-General
Gardiner have proceeded to Turkey, to act under the
Commissary-General. Mr. A. C. Colquhoun has been
appointed to a clerkship on the establishment of the com-
missariat. Twenty men from the London Police Force
,have volunteered for employment in subordinate capa Will
ties in in the commissariat department in Turkey, and
proceed thither witliont delay. General Post-office the •
service is • Turkey—Mr. Thomas William Angell has •
been selected to act as assistant postmaster of her Ma-
jesty's forces in Turkey. Mr. Smith and Mr. Angell
will take their departure on the 4th in-t., in the Petiin-
suler and Oriental Company's steamer
th Ca n ditha.er w One e of
these officers will follow the army, and e obe
stationed at Constantinople. Customs—the collectorship
of Truro is vacant, vice Anson, deceased. The collector-
ship of Padstow is vacant, vice Macleod, deceased. Mr.
J. Cleave has been appointed clerk at St.
h as Katharin
ne's
Docks, London. Mr. George Marshall bee ap-
pointed clerk at the London Docks. Mr.
promoted, J. Robert-
son, comptroller at Lowestoft, has been at
the same salary, to the office of collector at that port.
Inland Revenue Department—Mr. Joseph Buxton, of
Beccles, has been appointed clerk in the Norwich col-
lection, vacant by the decease of Mrisor of . James W. Bot-
wright. Mr. J. A. Cleworth, supery Cambridoe
district, has been appointed an officer of stamp duties
in England.—Oivil Service Gazette.