The Sun.
London, England, 1847-12-04 00:00:00

speculations undoubtedly; and on one point, in reference
to railways, he differed from his Right Hon. Friend
the Chancellor of the Exchequer. Ten or twelve years
age, the great grievance and subject of complaint was
that we had more capital than we could find reasonable
investment for.—(Hear, hear.) The result was, that
capital found outlets in every possible way—there were
lenders in all directions—borrowers naturally followed—
and there could not but be speculation under such a
system. There was also a mass of labour for which we
had no employ; and both our capital and our labour
were finding an outlet in foreign countries. Had the
nation prayed for anything, it would have bees for a
reasonable and profitable investment for its capital, and
fair and honest employment for its labour ; and these
things railways had given to the country.—(Hear, hear.)
The system had certainly been overdone, as everything
was overdone in this country —(Hear, hear.) Bur,
though he was not at all insensible to the evils of over
speculation, he had considerable doubt as to the expe-
dience of the Government or the House interfering to
check the investment of capital in any way.—(Cries of
" Hear, hear.") He looked at such interference with
the greatest alarm. It was only when we enacted by
law how long the labourer should work, and in what way
capital should direct itself, that he felt at all doubtful as
to the fate of this country.—(Hear, hear.) A Committee
of that House had been appointed, to whom the railway
Bills were referred, to see which might safely be al-
lowed to go through and which ought to be stopped. On
a former occasion he had opposed such a project, and he
was still of the same opinion.—(Hear.) Fully admit-
ting the great inconveniences of unrestrained specula-
tion, he could not look without alarm at a Committee of
that House telling him or any one else how to deal with
their money.—(Hear, hear.) He only hoped that the
Committee would give a comprehensive report. and state
the principle on which they proceeded. If they went
on the principle that there were too many railway
schemes for the floating capital of the country to find
money for, he hoped they would enter into all the details
on which that opinion was founded—state what was the
floating and what the fixed capital of the country, and
give at least some estimate of how much was required
for the legitimate wants of the one and the other. If
this Committee should adopt the views of the Right
lion. Member for Coventry (Mr. Ellice)—that the
rate of interest was so high, that it was
impossible to go on with the regular trade
of the country, he hoped they would state how high
interest should be allowed to go, and whether they
thought it advisable that new usury laws should be
passed in favour of the meacantile and manufacturing
interests, and against the money invested in railways.
At present, perhaps, no great harm would result from
tsrowing out all the railway Bills now coming before
Parliament ; but, the moment the House took upon
itself the duty of saying that they would only allow so
much capital to be invested in railways as they comas
dered could be fairly spared from the other purposes of
trade, they would undertake an almost impossible task.
—(Hear, hear.) Now, to whom was to be given the
superintendence over the capital of this country—who
was to tell exactly how much was to be drawn off from
one trade or another—who was to bottle oft' the floating
capital, afterwards to be transferred to fixed capital, and
to fix the amount—he knew not ;he only hoped that, if
the Government or the Committee did it, they might
have the consolation of the philosopher in " Rasselas,
that they had done no mischief.—(Hear, hear.) Another
expectation which he had entertained from the Bill of
1844, and which had also beeen fulfilled was
this : he had witnessed the difficulties of 1837
and 1839 ; after a season of prosperity, some
accident gave a turn to the exchanges, and caused an
external drain on the Bank for gold. The Bank at-
tempted to set the exchanges right, and with difficulty
succeeded, and succeeded at a time when the gold in
hand was so small that the slightest internal drain
would, in all probability, have led to a suspension of cash
payments. That was a subject of deep alarm at the
time; and every one knew that, in 1839, the bullion in
the Bank sank to just two millions. It had been ex-
pected that, by the operation of the Bill of 1844, the ex.
changes might be set right, without the Bank being loft
in that state of extreme weakness; and no doubt that
expectation had been perfectly answered.—(Hear, hear.)
Whether the measure had been taken rightly or wrongly
wisely or unwisely, it was quite clear that the exchange'
had been set right, with an amount of bullion in the
Bank which had left it free to act—at any rate, free
from those fears of an internal drain which were by no
means visionary. He rated this advantage very high%
for he had left office with deep alarm, thinking it by no
means an impossibility, if our monstary system
continued as it then was, that in the next
case of difficulty the Bank might have stopped pal'
went. And, looking at the circumstances, at the
heavy combination of difficulties in this last crisis, he
would not conceal from the House his conviction that, if
all this had come upon the country with no other pre-
caution and check than existed before the Bill of 1844,
they would now have been sitting to consider a very
different state of circumstances from those before the
House.—(Hear.) On two points his anticipations from
the Act of 1844 had been fulfilled—he wished he could
say the same as to the last. He had alluded to the re-
sponsibility which might attach to raising unfounded ex-
pectations. Among other expectations was this—that,
by compelling the Bank to commence its operation
early, and to withdraw the notes gradually from circus
lation as the gold was withdrawn from the country, the
commercial interest would thus be gradually operated
on, and those difficulties which could not be prevented,
would be mitigated. The Bank mistook the signs of the
times, and neglected to take precautions early enough,
and when the difficulty and danger came it made a sort
of convulsive effort to save itself at any. risk ; and the
expectation was that by compelling the Bank under
this restriction to take an early step of precaution,
the country would be saved from those convulsive
efforts which the Bank was accustomed to make,
and that these crises, although inevitable, would be
mitigated in their effects. He, however, admitted that
such expectation had entirely failed; but he must confess
to the House that he could not yet help thinking that
the principles upon which that expectation was founded
were correct and true— (Hear, hear)—and the more so,
when he looked at the operations of the Bank itself.
On this point, to make himself clear, he must trouble
the House with figures. He would first take September
the 12th, 1846, and he found, taking the figures under
the old system, the bullion in both departments to be
about 16,000,0004, but on April the 17th, 1647, there
was a diminution of bullion to the extent of 7,000,000 .
Ile would take the same dates as to the notes, and he
found that on the 12th of September, 1846, the circhu an;
tion was 20,982,0004, and on April the 17th, 1847, t e a
was an increase of 246,000/. He must ssY that was
a,
state of figures that he never thought could have be
shown under the operation of the Bill. In 1840, when
they were taking the evidence on which the Bill was
framed, if any one had found in the history of old trans-
actions a case where the bullion had run off 7,000,0001.,
and the notes had increased nearly a quarter of a mil
lion, he should have said it was one of the strongest
merits for the alteration of the system, and he should
have used it as a most powerful reason for such a Bill as
that of 1844. It was not enough to tell him, in reply'
that it was the fault of the Bank, for it was evident that
there was something which they had not sufficiently COn:
sislered as to that part of the Bill—he meant with regard
to the reserve in the Bank. He believed that, looking
back at that evidence, the operation of that reserve was
not sufficiently considered. It had enabled the Bank to
do the very thing of all others which they ought not t 0...
have done; the Bank was enabled, when 7,000,0001. of
gold were running out, not to diminish its notes.
(hear, hear.) He thought that required some investi-
gation, for it did not work satisfactorily. He had lis-
tened to all the objections which had been made by Hon.
Gentlemen, and he thought the majority who had spoken
had objected to the Bill, but the grounds of the ob-
jections were the most discordant in their nature that
could be imagined. One Hon. Gentleman stated that the
Bill had ruined the commercial interests, attributing all
the commercial difficulties to the Bill; but another Hori.
Gentleman rose immediately after him, of the school
of which Mr. Tooke and Mr. Fullerton were the re-
presentatives, who assured the House that the Bill well
utterly ineffective—that it was a bad Bill, because it was
impossible by any law for the Bank to issue a note more
than was wanted, or reduce the circulation beyond
what was required. It was impossible that bath these,
assertions could be true. If the Bill had created all
this diculy, what bcame f that lass of gentlemei!
who said itt was meree o c
waste paper, and had no effect
whatever?—(Hear, hear.) He could not but recollect
what took place before the Bill of 1844, when he hap-
ened to be in the Treasury. All the same accusations
were made, and objections stated to him, which were
now urged against the BilL He was told that it ws.
all in the discretion of the Bank, and deputation after
deputation used to come up to complain of the misery
created by leaving the faith and fortunes of the con:laser'
cial community at the discretion of the Bank.—(licari
hear.) He would go into the working of the Act o,
1844, and endeavour to come to the conclusions whirl!
truth and experience would point out; but he could not
sit down without earnestly entreating the House not
to be led away by language, however effective—not to
be induced to make a sudden jump one way or tile.
other, but to deliberate, to inquire, to take time, and
not to be scared by the idea that it was ne-
cessary to do something, which, of all the errors of the
human mind, was perhaps one of the worst, that of
.bo:
lieving you must do something without knowing lett!
you ought to do. They might come to a wrong cone!
sion, for they were but men, and liable to err; but it
they decided without inquiry, they would have com:
mitted the greatest criminal act on this great questieee.
(Hear, hear.) Months of inquiry were of no cons
quence compared with the importance of coming to
right decision on so great a subject.—(Cheers.)
Mr. HERRIES said that the Right Hon. Gentleman
who had last addressed the House complained of herthe
a l
Majesty's Ministers for not having brought under th
consideration of the House, with a view to refer it to the _
Committee, those parts of their conduct which /07
mainly the cause of Parliament being called togethe
If that were all, the letters of the Government might y"
con
be referred to the Committee, but he should not be
tent with that. This could not be made a party quo:-
t
tion, and they ought to have brought before them, 1(11,.,
only what the Government did, but that which they
i
not know yet, why they did it?—(Hear.) The groun.
upon which they acted would do more to show the Worf,
ing of the Bill of 1844 than any production of papers cell!!
do. They should know the state of the Bank at the ttDr
when her Majesty's Government were induced, or tne
ra_
.4
compelled, to write those letters. The Chancellor ott
pf
?_
Exchequer, in his able and lucid speech, said that
was informed on the 22d of October that there was
panic in the City, and the Government thought l"
st
cessary to take such measures as they considered ino
prop, rto dispel it. It would seem as if it were to:ll.T_
pel some unfounded apprehension; but did not the p_
who said there was a panic disclose the state ro
Bank ; did they not say that if the Government d!didinterpose, the Bank would have been unable to discs
its engagements in two days without oarryillg 1)4