The Sun.
London, England, 1851-03-24 00:00:00

851.

[PRICE SD.

we could bear the debts of the war public and private,
not only without difficulty, but with ease and prosperity.
As the debts increased the currency extended, and en-
abled us to bear their pressure. The currency measures
of 1819, by altering the currency, added eight hundred
millions at one blow to the public and private debts,
and at the same time by restricting the currency re-
stricted the means of meeting the augmented pressure.
In 1823 and 1824 the currency was expanded the additional
burthon of eight hundred millions was thus taken oil, and
in 1824, and to the end of 1825, the country again en-
joyed ease and comfort as during the war. In 1826 the
currency was again contracted; the extra weight of eight
hundred millions was again imposed, while the currency
was restricted instead of increased, and again to 1834
the sufferings of 1822 were renewed. In 1834-5, and 6
the currency was expanded; we were again relieved
from the eight hundred millions, and again we breathed
in comfort. In 1836 the currency was again limited,
the incubus of eight hundred millions again placed on
our shoulders, and from this time to 1842 the country
was afflicted as before. In 1544, 1845, and 1846, the
currency was again increased, the load of debt was
relieved, and we again saw prosperity. In 1847
again the currency was drawn in, and we once more
had to support the unjust addition of eight
hundred millions to our obligations. Now the currency
has been for some time expanding, and some degree of
relief has been experienced. Now let it be observed that
besides the original debts contracted before 1819, there
are many new debts, and that all engagements, all leases,
all bargains, that all new debts contracted at times when
the currency was restricted, have been unjustly paid in
money of a less value by 30 to 50 per cent., when the
currency has been expanded, and that all debts, engage-
ments, leases, and bargains contracted while the currency '
has been expanded, have been unjustly paid in money of
a higher value by 30 to 50 per cent. when the currency
has been again limited. In the quotation which forms
the motto to this letter, Mr. Huskisson has clearly ex-
plained why it is that the contraction of the currency is
more ruinous both to individuals and the nation at large
than the expansion, because its effects fall upon those ac-
tive classes who are less able to bear the pressure, and who
constitute the true strength of a kingdom. This had
been already shown by David Hume and Mr. Locke, who
in passages familiar to your readers, have proved how
an empire whose currency is contracted must decline in
strength and happiness. When this is considered, is it
possible to conceive a system more productive of ruin
and injustice to every class at every one of these move-
ments of 30 to 50 per sent. up and down; and is it not
the interest of every class that some fixed and settled
system should be substituted to such a chaos of fluctua-
tion? Is it too much, again, to ask what Minister, what
Government, what individual Member of Parliament,
cognisant of this state of things, will remain responsi-
ble for its continuance? And is it surprising that the
administration of the country should be attended with so
much difficulty, and the formation of a Ministry a mat-
ter of so much anxiety and embarrassment? We see at
once the cause why the national defences cannot be ren-
dered secure, the colonies maintained or protected, or
even the present taxes endured.
But we have spoken of the changes in the value of
money as yet with precise reference only to the action
of those changes on the amount of the debts of the
country. We must advance further and expose the man-
ner in which all property and the condition of every in-
dividual in the country has been thus affected.
We must show more distictly the full extent of the
changes that have been produced by "that mysterious
hand which placed on a resistless lever can raise or de-
press at will the value of all property and the price of
all commodities." We must explain how it is that
leases have been made " gambling speculations on the
value of money," and the legitimate transactions of
trade made hazardous and ruinous. Let all men, land-
lords, merchants, manufacturers, tradesmen, farmers,
and labourers, shareholders in railways, and those who
toil at the:plough, the loom, and the :shuttle, consider
these fluctuations in the currency, and then look back at
the movements of their own affairs for the last 30 years,
and they will see how it is that changes to them hereto-
fore incomprehensible in the value of their property
and results of their operations have been effected.
Let.ns first briefly recapitulate the results of the mon-
strous mutations to which we have already directed at-
tention as regards the debts of the country. Mr. Johnston
has shown that the private debts of the country amount
to about sixteen hundred millions, the public debt of
the country to about eight hundred millions, making the
total debt of the country about twenty-four hundred
millions. Mr. Johnston has shown that by the currency
measure of 1819 this amount of twenty-four hundred
millions was actually increased in value from 30 to 50
per cent., that is, at the lowest estimate, not less than
eight hundred millions were, by the alteration in the
currency made by the Act of 1819, added at one blow
to tie public and private burthens of the country. Since
that time the currency has been three times contracted,
three times expanded. Each contraction has increased
the debts of the country eight hundred millions at least;
each expansion has reduced them again eight hundred
millions. These six changes, therefore, have made an
alteratittn of not less than forty-eight hundred millions

in the debts of the country alone, that amount repre-
senting the changes of property that have been made
between the classes of debtors and creditors alone.
Let it be observed that the bills of exchange alone in
circulation are taken at four hundred millions. Each
change of 30 to 50 per cent. has altered the value of the
bills of exchange in circulation not less than one hun-
dred and thirty millions. The changes have been re-
peated six times. Need we wonder any longer at the
ruin of the commercial classes whose transactions are
represented by bills of exchange?
Mr. Porter estimates the value of the annual produce
of the land at three hundred millions sterling. The
gross value of manufactured productions is estimated by
Mr. Spackman at one hundred and eighty-seven mil-
lions sterling, making the total value of the annual pro-
duce of land and manufactures four hundred and eighty-
seven millions sterling.
Let some bold arithmetician calculate the total amount
of loss occasioned by the six changes altering the value
of one year's produce only at each change not less than
one hundred and sixty-two millions.
And let not this statement appear exaggerated, for
the Manchester Chamber of Commerce showed in 1839
a loss of forty millions sterling caused by one fluctuation
in particular branches of trade. Need we wonder at
the changes we have seen in the circumstances of the
farmers, merchants, manufacturers, and labourers of all
classes? Look at the vast Sums invested in railway pro-
perty, and consider the effect of these changes of 30 to
50 per cent. made in the value of that property by the
alterations in the value of money, and we see at once
explained all the ups and downs that have so much asto-
nished us. Consider the manner in which the fifty
millions of annual taxes have been six times increased
and diminished in value from 30 to 50 per cent., that is
raised in value at one time to seventy millions the full
rate of the war, by the contraction of the currency, at
another time reduced to fifty millions again by the ex-
pansion ;of the currency, and we see at once why the
revenue has so often fallen off and so often again improved.
The value of that portion of real property only assessed
to the income-tax in 1842 was calculated by Mr. Porter
at two thousand three hundred and eighty-two millions.
Six times has an alteration of not less than one-third
been made in that amount, each alteration being no less
than eight hundred millions.
But when it is considered that the income and the
property, and the position of every one in the kingdom
who has a shilling in his pocket, who earns a shilling,
who owes or has a shilling owing to him, from the Queen
on the throne down to the humblest of her subjects, from
the revenue of royalty down to the wages of the poorest
workman, has been at each of these six changes alter-
nately increased and diminished by one-third, at the
lowest estimate, have we not at once before us
the full explanation of the frightful and stupen-
dous phenomena of panics, prosperity, and pau-
perism, which we have witnessed during that
period of thirty years in which these changes have
been in action? We see at once explained the glittering
masses of wealth suddenly tossed up on one side, and the
obscure abysses of extreme poverty that threaten to
engulf us on the other. We shrink from the calculation
of the aggregate loss and the contemplation of the con-
sequent sufferings that have been thus occasioned. The
first may, however, be counted, and we trust the esti-
mate, however alarming, will be made; but who can
form an appreciation of the moral and physical tortures
that have thus been caused and endured? Need we be
surprised that these tremendous changes have produced
moral dislocations as astounding as the physical phe-
nomena which are produced by the convulsions
of nature. Changes in the value of money,
the vital atmosphere of civilized life, are as
general and universal in their action as are
any modification in the character of the air we breat
he-
And when we consider that the people at largem
nature
come acquainted some day with the extent and
of the destructive process to which money, the medium
1
of exchange, which is the necessary e
social existence, has been subjected; that already
of their
already this
knowledge has been widely spread, and that the great
body of the productive population will soon understand
end. ured and know
the cause of the sufferings they have
it not, rather,
the reason why—would it not hs, w
imperatively necessarY to consider,iswellisle there is yet
time to amend the evif, and remedy the injustice, and
guard against the recurrence of such calamities, before
another convulsion may carry with it all that yet re-
mains of the tottering fabric of society? Let the cur-
rency system of 1819 be promptly and decisively aban-
doned, and the country may yet be saved. And let it
be remembered that it is not proposed to change a fixed
and settled standard and measure of value, but to abo-
lish a system of fluctuations which has changed
the value of money six times from 30 to
50 per cent. in the last thirty years, and to substitute a
fixed and settled system, which shall give to menu a
regular and permanent value, which shall be sufficient in
amount for the wants of the country, and possess, with
sufficiency, that stability and security which constitute
the requisites of the medium of exchange. It is no
question of altering the value of money.
is to fix the value of money. A s has be en
time the currency has been expanded the country has
Theshow question
eesvtei every
been prosperous, and the Acts of 1819 and 1844 have
been in effect as much abandoned as if they bad never
been passed. The present partial prosperity is known
to be mainly caused by an expansion in the currency,
which cannot last under our proms 'Mem. AU that

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is necessary is to C3D . ue permanently that amount of
currency which we ave bad at those times when we
have enjoyed prosperity; and a nation that can find se-
curity for a national debt of eight hundred millions, can
have no difficulty in finding security for twenty or thirty
millions of currency.
I am, Sir, your obedient servant,
INDICATOR.
P.S. I subjoin the extracts referred to from Mr. Locke
and Mr. David Hume, with a passage from the evidence
of Mr. N. M. Rothschild, confirming by his practical ex•
perience the results of the philosophical observations of
the eminent authorities first mentioned, and I hope for
these also you will kindly find space:—
"In every kingdom into which money begins to flow
in greater abundance than formerly, everything takes a
new face; labour and industry gain life; the merchant
becomes more enterprising, the manufacturer more dili-
gent and skilful, and even the farmer follows his plough
with greater alacrity and attention. The good policy of
the magistrate consists only in keeping it, if possible,
still increasing, because by ant means he keeps alive a
spirit of industry in the nation, and increases the stock
of labour, iu which consists all power and riches.—From
"Essay on Money," by David Hume.
" It one-third of the money employed in trade were
locked up, or gone out of England, must not the land-
holders necessarily receive one-third less for their
goods, and consequently rents fall, a less quantity of
money by one-third being to be distributed amongst an
equal number of receivers? Indeed, people not per-
ceiving the money to be gone. are apt to be jealous,
one of another ; and each suspecting another's in-
equality of gain to rob him of his share, every one will
be employing his skill and power the best he can to re-
trieve it again, and to bring money into his pocket is
the same plenty as formerly. But this is but scrambling
amongst ourselves, and helps no more against our want,
than the pulling off a short coverlet will, amongst children
that lie together, preserve them all from the cold. Some
will starve. unless the father of the family provide better,
and enlarge the scanty covering. This pulling and con-
test is usually between the landed man and the merchant;
for the labourer's share being seldom more than a bare
subsistence, never allows that body of men time or op- •
portunity to raise their thoughts above that, or struggle •
with the richer for theirs (as one common interest), un-
less when some common or great distress, uniting them
in one universal ferment, makes them forget respect, and
emboldens them to carve to their wants with armed
force; and then sometimes they break in upon the rich
and sweep all like a deluge."—From M.r.Locke's " Conii-
derations on Money."
" If this country has money in abundance, it will have
all the trade from the whole world; and if you make
money very scarce, the trade will go to other countries."
—Extracts from Evidence of N. M. Rothschild, Esq.,
before Committee of House of Commons on Bank
Charter in 1832.

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