The Sun.
London, England, 1847-05-11 00:00:00

lelear timersd than at the time I commeneed.—(Re-
k
ts, wed laughter)—and most say that I rejoice that the
ra)nar-
guments which ---i:o-d
I thought fell up n my ear, were not intended
as, he understood by the Hon. Gentleman as he spoke them.—
eLsughter• ) I rejoice st the willingness that there seems on
the part of the Hoe. Gentlemen to admit them when they are
DO bat -er g affected by subsequent events. I rejoice that he is
in faeonr of the standard of 1819 —( Hear, hear, and laughter)
—that the Hun. Gentleman occupied that intermediate posi- •
tin* between an unwillingness to adhere to the standard of 1819,
mid a readiness to alter it.—( Roars of laughter.) That
was the proposition nude by the Noble Lord (George
Bentinck), and the Honourable Gentleman the Member for
Shrewsbury, namely, an alteration of the Bill of 1819, they
were in favour of a convertible paper currency, but they
thought that the evils from which we are at present suffering
may be cured by the simple repeal of the Act of 1844 ; but be-
fore yr* repeal the Act of 1844, or before we make any modifi-
cation of it, let ns well consider the evils under which this
cetsntry is labouring ; let us well consider whether or no we
desire to obtain some improvement of the present state of e •
fizance-....whether or no we are not incurring the risk of a
sub-
sequent aggravations of the evil ? I don't want any better
description of the' present condition of the country, and
t'ae real nature of the pressure with which we
have to deal than that which I find in the able statement of
the Hon. Gentleman the Member for Huntingdon. He says
this country is suffering from unexpected scarcity of provi-
sions._
Now that is the fact. A calamity, of which none of
us calculated has arisen. The Noble Lord (J. Russell)
calculated that the loss of capital in this country,tthe
inc onse-f
quer,er: of the failure of the potato crop, and ofailure othe crops on which we in this country depend, for instance, has
been 16,000.000/. sterling.—( Hear.) What must be the
effect of the abstraction of capital to the amount of 16,000,0001.? j
by t, above all, when it is caused by such a calamity as the
3,,arcity of food. It is not merely the loss of capital, but it is
the calamity which has caused it.—( Hear, hear.) Is it not
a fact that this calamity has occurred in other countries in the
northern parts of Europe ? How it was that so little
calculation was made last year I know not. Whether
the state of the atmospheric influence which caused the failure
of the potato crop has affected some other descriptions of vege-
table produce I know not ; but what we all know is that in our
own and other couutries in Europe, after the harvest had been
gathered in, there appeared nu prescience of the calamity
wlsach followed ; not even in this country only, but in ether
countries from which in scarce years we are accus-
tomed to draw supplies. France is suffering, and so
is Holland and Belgium, and as I have said
in other countries in the north of Europe—all along the
banks of the Rhine a large portion of the crops have failed.
Even the counties in the northern"parts of Europe have
parted with their crops—particularly rye—and I am told that
the pressure, in consequence, is extremely great upon them ;
and that those countries who have supplied us with grain,
are suffering severely themselves ; and, therefore, we are in
this condition—not only are we suffering from the want of
food, which has led to great distress, but we are informed by
the Noble Lord, that the loss of money has amounted to
16,000,000/. ; but, concurrently with that, that a similar
misfortune had visited other countries in the northern
parts of Europe, and we are dependent upon the United States for
our common supplies, Why, what an effect this must have
upon commerce I Do not talk of the failure of free trade.
Has it as yet—could it have had as yet a fair trial ?—( Cheers ).
Is it not quite clear that the ability of this country and
of other countries to consume manufactured products must
have been materially impaired by the superior necessity which
has befallen us, by having to devote the whole of our availabled
means to purchase food? Therefsre the consumers here an
in other countries of Europe have been compelled to devote
their surplus revenues to the purchase of the means of ex-
istence. Then, says the Honourable Gentleman, there
never was a year in which speculation ran so high
as in 1845. If men will speculate, and will run
riot, depend upon it, whatever Legislative enactments
must pass, they must suffer the consequences - (Hear, hear)
—it is inevitable. But, says the Honourable Gentleman, " I
don't deny the great importance of railways. I admit that
railways may be the foundation of future prosperity;" but this,
I say, that if the capital of the country ordinarily applied to
commerce is in extravagant quantities lucked up in railways,
then there would arise a severe pressure in consequence—
(Hear, hear;) and in addition to the failure in food, you have
had speculations running riot so far as railways are concerned,
and 1 think in the course of last year applications were
made to Parliament which if they had been acceded to
would have required capital amounting to 3-10,000,0001 (as we
understood) for their construction.—( Hear.) Is there no
course concurrently with those to which I have referred, to add
to our difficulties ? There has been a failure in that most im-
portant material of manu:acture, the cotton crop ; it has fallen
short far beyond any reasonable calculations, and the cnnse-
quence of its failure has been an enormous increase in the
price of that material, which is one of the most important ele-
ments of our manufacture ; and therefore we are at this mo-
ment suffering from an insufficient supply of food, and an enor-
mous amount of capital locked up in railways. You may think
it advisable to throw the blame upon the Bank charter of 1844,
but if you had an inconvertible currency, or any modification
of paper and metal, depend upon it, there is no one country in
the world, exposed to the triple operation of such calamities,
which would not feel the greatest pressure, which no increase
of bank-notes could remedy. I assure the Noble Lord that
no consideration of personal consistency would induce me to
throw arty difficulties in the way of an alteration in the law, if
my experience taught me that it was necessary, and for which
after all Parliament was as responsible as myself. No, I as-
sure the Noble Lord that I claim the same privilege which I
exercised upon the corn law, if experience convinces me that
the interest of the country—in matters of this kind, where no
political principle is involved—require a modification of a
law which I myself have proposed, no personal feeling would
sway me to offer any opposition to such a step. Now, Sir,
with respect to the Act of 1844. The Bank 'Charter was
about to expire, it was necessary to make some new regula-
times ; those proposed by me were not adopted without five j
years of protracted inquiry. The Committee on joint-stock
banks, which sat during the years 1836 and 1837, collected
the evidence of some of the highest authorities in the country.
and it was upon their testimony that this Act was constructed,
and it was not one of a mere speculative character upon the
currency of the country, without any experience of the past
evils. On the close of the war in 1819, the Honourable

Gentleman sap, I dwelt upon the prosperity of the
country, and the triumphs of our army, and our sta •
Jollity of faith, but I did so as an inducement to the
House of Parliament to sanction the fulfilment of the
promise held out that no the close of the war and the return of
peace, cash payments should be resumed. I did call on the
people to fulfil those engagements. But did the Hon. Gen-
tleman, when preparing himself upon this subject, forget to
read the history of the years fourteen, fifteen, and sixteen? Is
he aware that from the period of 1819, which followed the
resumption of cash payments, no less than 240 private banks
failed in this country, and why so? because on the return of
peace they were unable to meet their engagements, and the
altered position of the money market led to such a state, with
which the present, grievous as it is, is nothing to be compared.
Are we to restore the law of 1844, that is to say,
shall there be an unlimited issue on the part of the
Bank ? Shall there be, on the part of the Bank, a right to
issue notes upon their own discretion. We have been told of
what took place in 1837 and 1838 ; then the bullion was re-
duced to 600,000.'. If you do consent to repeal this Act, and
restore the old state of things, you have not the slightest se-
curity against a return of these disasters which took place in
1836 and 1839. The main object of that Act was to prevent,
in times of difficulty, the temptation, which it is so easy to fall
into, that of giving accommodation and purchasing temporary
ease, and afterwards aggravating the commercial pres-
sure which led to the demand fur gold in exchange for
paper. It is of the utmost consequence that you
should not be exposed to these other difficulties of a de-
mand for gold. At present there is not the least panic ; there
is not the least doubt as to the solvency of the Bank. There
is, to be sure, severe pressure, but that is all. But what
would be the state of things if there was an apprehension
as to the solvency of the Bank ? What would be the
srate. of things supposing this Act had not passed, and it had
beer -:n the power of every country bank to foster the spirit
'elation which existed? It is said that the object of the
"41 was to introduce a machine which would work
that is perfectly trios with respect to the
ie Bank. The issue is a machine which works
• almost regret that it has not been separated
Bank altogether. It might have been so, and then
I not have heard anything more about these different
--ts of the Bank, which were wholly repealed, and
•rence to each other. But the reason it was not so,
iant of the expense which the erection of a good
-:casion. With regard to the Bank the Hon.
Member for Montrose (Mr. Hume), said they
'.o criticise the connuct of the Bank. Is it pos-
House of Commons can maintain that doctrine?
•:he conduct of the Bank I You cannot deny the
eh the Bank mast exercise over the currency and
son. With 7egarel to the criticisms upon the con-
-a Bank in August, I never complained of the conduct
.ank. What I said was, that for three months, from
( January, 1847, there bad been a continuous drain of
'ad I ventured to express a serious doubt whether a
in of the subsequent pressure might not hive been
ed, if the Bank had not, in January, when a full know-
of the extent of the calamity in Ireland must have
I.e known, continued to discount at four per cent.
,g those three months, when a continuous drain of
was taking place. The Right Hon. Baronet proceeded to
that the Hon. Gentleman said he had told the House I

at the Bank had done in 1837, 1838, and 1839 ; and he did
t actually venture to prophesy ; but he gave the House the
surance, that if the Act of 1844 had been in operation in
_hese years-1837, 1838, and 1839—there would have
been no amount of difficulty felt. Well, it would have
been difficult to see what would have beeu the consequences of
an Act which, five years afterwards came into operation. But
one element, which the Hon. Gentleman had quite neglected
his calculation, was the country circulation. Let them take
tas it existed about the year 1823. In November of 1823,
amount of bullion in the Bank of England was 13,760,0001.,
in November of 1825 it had fallen to 3,012,000/. ; but
_wean the November of 1823 and the November of 1825,
.e country bank paper had increased from 4,000,000/. to
8,000,000/. Again, in the year 1834, the amount of bullion
was 9,948,0001., and in 1837 it was fallen to 4,000,000/. ;
but during the same period, when the amount of bullion
had fallen from nine millions to four millions,
the circulation of the country bank paper had
increased ,from 10,000,000/. to 11,600,0001. in 1837 ; and
"u the month of August, when the country was in the middle
the crisis, the country bank circulation had actually in-
.ased to 12,000,000 t. In 1838, the amount of bullion was

132,0001. ' • and in 1839, it was 4,344,0001. ; but the country
-inks circulation was at that time 11,740,0001. But the Hon.
gentleman omitted from his calculation the whole of the issue
of country paper, and, moreover, he disregarded the very
principle on which the whole rested—namely, the foreign
exchanges. At least the Hon. Gentleman must admit
that the country bank paper was a material element
in his calculation. But what then was the object of the Act
of 1844? The object of it was expressly to prevent this very
evil by imposing a limitation on the issue of the country bank
paper ; but if that was its purpose, if there was no other pur-
pose, then it gave the Bank of England a direct control over
the paper currency. The Bank of England not subject to
criticism ! He could bear testimony to the high honour and
strict integrity which influenced the directors, but the Bank
was a national institution, it held great and exclusive monopolies;
it held an exclusive privilege within sixty-five miles of the
Metropolis, of issuing paper. It excluded all others entirely
from competition with it. '
Such was its position, just that it
might have a control over the paper circulation. The Bank of
England would tell them that the country paper exercised a
material influence. The Act of 1844 contemplated that in
its provisions; it reposed confidence in the Bank directors,
and they were prou,i both of the Act and the confidence re.
posed in them. The Honourable Member for Huntingdon him-
self stated that the Bank of England exercised a
influence on the country circulation and exerted considerable material
control. Bat the Honourable Gentleman had the memorial
of the Bank directors. Why that was before the House in
1844. The Honourable Gentleman asked why the House did
not follow the suggestion made in that document ? That sug-
gestion was discussed. The House discussed it, and thought
right to give the Bank a discretionary power.
But supposing that the Government had foreseen this pressure
on the Bank, and that it could not give the accommodation
which was, required to the commercial interests of the country '
—supposing that the Government in that case gave' the Bank
the privilege of issuing three millions on additional securities,
did they suppose, on the slightest apprehension or appearance
of prism', the Government would bo appealed to for