The Sun.
London, England, 1847-11-27 00:00:00

RAILWAYS.

The CHANCELLOR of the EXCHEQUER
rose, pursuant to notice, to move for leave to bring
in a Bill to extend the time for the purchase of the
land and completion of the works upon railways.
If the debate upon the first night of the session had
taken the course which he expected it would, it would
have been his duty then to have stated to the
House the reasons which had induced the Go-
vernment to pursue the course they had done.
and also the views they had formed of the causes of
the present commercial pressure. Among those
causes he should have included as one the great
absorption of capital by the demand of railway com-
panies. He did not mean to say that that
was the sole or principal cause of the
pressure which had recently existed. He did
not wish to ask any Hon. Member to give up the
opinions he had formed of other causes to which the
pressure was to be attributed. He thought that it
was a great mistake to attribute any great result to
one single cause, and all that he asked of Hon. Members
who might entertain opinions different to his own
was, that for this night they should only admit that
the absorption of capital by railways had been one of
the causes which had led to the production of the
present state of commercial embarrassment.—(Hear,
hear.) It would have been more satisfactory to
him had he been able to state to the
House the whole case at once, but as it
was necessary that no time should be lost in
bringing forward this measure, it was not a matter of
choice but of necessity that he should undertake this
portion of the case at once. One of the many points
which had frequently been pressed upon him was
the inconvenience which commerce had sustained
by the absorption of the floating capital of the
country.—(Hear, hear.) The floating capital of
a country was that which is employed in carrying on
the ordinary operations of agriculture and commerce,
and in their further development ; in the erection of
buildings which were required from one end of the
country to the other; and also in the construction of
permanent works, including docks and railways, which
ultimately contributed to the welfare and improvement
of the country. If the floating capital were too
rapidly converted into fixed capital, a pressure must
of necessity arise upon the commerce of the country.
Floating capital was employed in reproductive
works, whereas fixed capital sunk in perma-
nent works, however useful they might ulti-
mately be, would only produce for a considerable
time an annual dividend or division of profits. The
case could be easily illustrated—suppose, for instance,
the case of a farmer conducting a large farm, and
employing a certain amount of capital for the
purposes of his farm, he might employ
the surplus of his capital in useful works,
such as draining and fencing, but if he ab-
stracted any portion of the capital necessary for car-
rying on the ordinary duties of the farm for the pur-
pose of those improvements however valuable they
might ultimately prove to his farm, still the ordinary
operations of his farm would, no doubt, be crippled.
—(Hear.) The same illustration would apply with
equal force to the case of the manufacturer.
Now, what was applicable to an individual farmer or
commercial man was applicable to the whole com-
munity, and there could be no doubt that the whole
country had latterly been pushed for money in con-
sequence of the immense amount of railway specula-
tions that had been going on. Railway companies
had been borrowing money, the commercial world
had been borrowing money, and the result of all this
competition of borrowers was to make money more
difficult to be got at. So long as the demands of the
railway companies were not heavy, the resources of
the country afforded ample means for agricultural
operations, for the manufacturer, and for railway lia-
th
bilities.namely, they ha d
a rise .
After a time, however, they would find that
. demand for capital became excessive—exceeded
the supply—and the natural consequence was, that
which
when
and the seen during the last year and half-
-3.r,
eom m
enr hale rateart of f
theinterest
community ; f o for,
also required ,
h
Tal row cc •
largely,companies were borrowing money
icompetition and,
an money, the consequence was a
increaseid in the rate of interest.
d
—(Hear, hear.) Hethenot know that he could
better state that part ofthan by using the
Taturday.
words of the Economist of lastease
House Noble Lord
hear, and derisive laughter from
correct or abler statement of —(Hear,
tinck and the Protectionists.) 4,P'hde ‘le'ge Ben-
might smile, but he could assure the
had not seen a morethat he
effect of these transactions upon the capital of tthee
country than was contained in the article he was about
to read. The Economist said :—" The manner in
which the large abstraction of capital has been par-
ticularly felt has been as follows. During the last