The Sun.
London, England, 1833-07-02 00:00:00

a certain commission charged on gold over that which

would be demanded for notes. This had been the case in
Manchester on the establishment of the branch bank, to
the extent of one-eighth, arid the knowledge of the fact

had tended materially to alter his views upon the subject.
It would prove a great hardship on the poor and remote
districts, more especially those far distant from a town

where there was a branch bank. A further reason for his

present vi?w of the subject wag, that the working of this
clause would have the effect of hindering small depositors
—men who bad their thirty or forty pounds—from carry-
ing gold to the country bank. They took it there now

because they knew they could have it back on demand,
but they would, of course, cease to do so when they had
no longer a legal title to its repayment in the same coin in
which it was deposited. Thus would they deprive country
hankers of the means of conferring benefit on their neigh-
. ..

bourhood, for it was by hoarding these small savings that
they were afterwards enabled to spread their capital aver
the country. It was from the great suspicion he now
entertain"d that there would be a deficiency of local specie,
and that consequently there would be a great liability to
the occurrence of a commercial panic—it was iu a great

measure from a suspicion on that head, that he should
withhold his assent from the present Bill. He could not
give his consent to the measure unless he saw perfectly
that there would be always a sufficient amount of specie
distributed through the country, and he must say that he
did not see any provision for such a rtsult in the present
Bill, nor was he convinced that such would be its effect.
He had a ftrther distiust of this measure from the cir-

cuinstance that it was adopted and praised by gentlemen
who held certain opinions on the question of the currency,
which he had no doubt they held sincerely enough, but
which he could not avoid as considering likely to be inju-
riot'. to the country if they were adopted. He thought that
they ought to refrain from any alteration of the currency
such as was now proposed, without having first proved
to them that there was a clear and distinct evil to be reme-
died, and that the remedy itself was one that not only
would meet the evil to he provided against, but that would
not occision an evil of a different kind, and perhaps 01 a
greater extent.—(Hear ) This was the more necessary,
as there was scarcely any evil that could happen that
would not be ascribed in the minds of most men to a
change in the currency. It was always made responsible
for all the distresses that might ',AA the country at that
period. This might he right or it. might be wrong, but
the tact was so. He should not pretend to say that the
present system of the currency was free from all imagi-
nary obj-cations ; but so far a. he knew, there were none
to which it way liable, against which might not he op-
posed equal if not greater objections in the no.v pro-
posed. Till, therefore, the danger to be remedied and the
safety of the remedy itself were fully made out, he should
not feel himself at liberty to accede to the Noble Lord's
propositions. He knew that what he had now said was
not in accordance with his former opinions on this subject;
he di.tinctly called the attention of the House to the fact ;
but more extended experience hail had the effect of show-
ing him his mistake, and he left this confession of his error,
which truth required him to make, to operate on his repu-
tation as gentlemen might think fit it should.
Lord A LTHORP onserved, that the change in the Hon.
Member's opinions had taken place since the evidence he
gave before the Committee on the Bank Charter, and cer-
tainly the Hon. Member had little right to find fault with
his (Lord Aithorp's) opinions, since those opinions had
been much influenced by the suggestions of the Hon.
Member, as given in that evidence.—(Hear.) The Noble
Lord then referred to some answers of the Hon. Member,
to show that, in those answers, the payment of country
hank notes by Bank of England notes had been recom-
mended. The Hon. Gentleman, however, now said that,
since giving that evidence, other circumstances coming to
his knowledge bad altered his opinions, and especially
the fact of the commission paid fur gold in Lancashire
since the establishment of the branch banks. He must
say that lie could not agree with the Hon. Member in
supposing that the poorer districts of the country would
suffer from this measure; indeed, he believed that all the
evils anticipated by the Hon. Member as likely to occur in
such districts would be prevented by the competition
among the country bankers. The Han. Member had
supposed that the poorer classes of tradesmen in the country
would dislike to place coin in the bands of the country
bankers, because they would not be able to draw it out
again. Now, though they would not, under this Bill, have
exactly a legal claim to draw it out again, yet, if there
were two batiks in one place, and one was ready to pay,
when required, in gold, and the other was not ready to do
so, that difference in their mode of dealing would make
the people select one of these banks in preference to
the other, and that selection would cure the evil. He
believed that the anticipated evils were never likely to
be felt except in times of great difficulty, and against
such occasions the measure bad endeavoured to pro-
vide. In times of difficulty it was of the greatest
possible importance to increase the security of the Bank
of England—and times of difficulty like those of 1825
might again occur. But then, said the Hen. Member
for Bridport, the effect of this measure must be to tend
to produce a considerable depreciation in the standard
of value. The Hon. Member knew as well as any one,

that the effect of such a circumstance would be to torn
the foreign exchanges ag-inst this country, and that
being so, the Bank must have such a drain of gold as
would have the effect of restoring the exchanges. There

was nothing but a B ink Restriction Act that could keep
the exchanges permanently against this country. He
believed that the fears of the Hon. Member were ground •
less, and that the change would be productive of the

greatest advantage to this country. Instead of affore
ing any ground for apprehension that it would produce bad
eff-cta on the circulating medium, he believed that all
such evils were fully guarded against, and that it would
be most desirable that the resolution should be adopted.
Mr. CLAY thought that the manly and noble conduct
of the Hon. Member for London, in thus frankly avowing
what he now considered to he an error of opinion, was
above all praise ; and instead of detracting from his cha-
racter for talent and judgment, would only increase his
deservedly high reputation.—(Hear, hear.) With respect
to the plan which the Government bad proposed, he
thought the Noble Lord had altogether failed, both in the
point of showing that there was any difficulty or danger
in the present system, and that the proposed plan would
obviate it. The Noble Lord had shown no necessity for
snob a change in our monetary system, and in his (Mr.
Clay's) opinion, no such panic a', that of 1825 was likely
again to occur. He believed that the plan of the Government
was not calculated to obviate any real danger ; but he
feared that it was likely to create some. He ;bought
that they incurred danger in infringing on the princip',
of the conveitibility of Dank paper ; he should oppo‘e
that part el the plan most decidedly. Country banks
had already sufficient facilities for circulating their paper ;
the issue of it was favoured by several different eta cum-
stances. He knew that there were instances, in some of
the manufacturing districts, in which manufacturers paid
their men in a body, so that they might give among three
or four men out! 51. country bank note, instead of giving
to each the amount due to him in sovereigns; and these
men were charged, at the public-house where tory spent
their money, Is. for each note changed for therm This
wits a serious evil in these pl .ces.—( Where, who re ?)
In the manutacturing districts of Lancashire and Yurk
shire he had known instances of it. He could tell
the Noble Lord that there was already a feeling against
this plan, even in those parts of the country where
Bank of England notes now circulated, instead of
country notes ; and that in these places indignation
etas already expressed at the attempt of the Govern-
ment to make B ink of England nutes a legal tender, and
there was already a disposition to combine and prevent
their circulation.—(Hear, bear.) What were the inten-
d oI the Coil,et ea,eact. 1,1
Leland on this part of the subject ? Did the Noble Lord
wean to make Book of England notes a legal tender
there? fur if be did, he might as well resort ac once 10 a
Bank Restriction Act, the evils of which he bad just
confessed.—(Hear, hear.) Si persuaded were the Ame-
ricans of the necessity of a perfect convertrbility of paper
into a gold, that there were no charters now given to
incorporate banks there, except upon the condition that
they were to be forfeited the moment they were unable tin
pay a single sum in gold.
Mr. JOHN SMITH praised the conduct of the Bank
of England in 1825, and in opposition to the Hon.
Member who bad Just sat down, must express los belief
that such a panic was likely again to occur. It was the
interest of every man in the country to protect the credit
of the country, and such another event might he produc-
tive of the most serious consequences, if some measure,
such as that of making Bank notes a legal tender, was
not adopted. He dril nut imagine that if Bank notes were
made a legal tender, it woula produce any scarcity of
go :d. Though the circumstance merßi rued by the Hon.
Member who spoke last might be perfectly true with re-
spect to the publican, it did not exist with regard to the
country banker, who would change the note without
charging any commission fur it. He was not cne who
wished to tamper with the currency He thought the
Right Hon. Baronet in bringing in the 8.11 of 1819 bad
done the greatest possible service to the country, and so
much Wa, tie opposer to a paper currency, that if we were
to have one•pound notes again, he, though not an old
man, should retire from the banking business, and do as
well as he could upon his private means—(A laugh
he believed that our ruin would infallibly ensue from such
a measure. He had the greatest respect for the talents