The Sun.
London, England, 1858-09-08 00:00:00

11. R. SPOONER'S PROPOSED REPORT ON THE
BANK ACTS.

(From the Derbyshire Courier.)
Whatever opinion may be entertained on the
Bank Charter Act, there is little difference of opi-
nion as to the report which the Bank Acts Com-
mittee have published to the country. The sup-
porters as well as the opponents of the Act of 1844
regard the committee's report as a complete failure.
It enunciates no " general principle" of currency,
and it propounds no remedy for the periodical
panics to which, under the Bank Charter Act, the
country is exposed.
We invite attention to the short, but comprehen-
sive and judicious, report which Mr. Spooner pro-
posed.
Much has been said about over speculation, and
a large portion of the evidence adduced was taken
to prove the extent to which speculation has, of
late years, been carried.
Mr. Spooner clearly points out the cause of this
speculation, and the consequent effects.
"It has been proved," he says, " before your
committee that the very low rate of interest neces-
sarily created by the reaction incident to former
panics, and by the Bank of England being com-
pelled by law to purchase gold by the issue of their
notes, whether they wanted gold or not, stimulated
speculation to so great a degree that all prices rose
except the price of gold, which, being fixed by law,
could not rise, and consequently it became the
cheapest article of export, and left the country.
This created a demand for gold on the Bank, com-
pelling the Bank to counteract that demand by
contracting its issues. This necessity of contraction,
being observed by commercial men, the effort
became general to secure bank notes while they
were to be had, and thus was added to the real
demands for commerce a pressure arising fromhoard-
ing, which would not have occurred had not the
Bank been. unduly restricted in its issues."
This is a plain statement of fact. The Act of

1844 first stimulates speculation by over-isssues,
and then produces panic by under-issues of bank
notes.

Mr. Spooner condemns the principle of both Acts,
those of 1819 and 1844. "The Act of 1819," he
says, "being wrong in principle, was productive of
the panics of 1822 and 1825, and of the monetary
pressures of 1836 and 1839. A system wrong in
principle, being really and more rigidly carried out,
as the Act of 1819 has been by that of 1844, could
not fail to produce aggravated mischief ; hence the
more terrible effects produced by the panic of 1847,
and the pressures of 1855-6, so paralysing to in-
dustry and trade, terminating in the still more de-
structive panic 0f1857. The evils and impracticability
of the system are pointed out in the evidence re-
corded by Mr. Alexander, Mr. Twells, Mr. Chap-
man, Mr. Capps, Mr. Foster, Mr. Lloyd, and
others."
Mr. Spooner repeats the propositions which he
submitted to the Committee on the commercial
distress, in 1848, and which facts have fully
vindicated :--" That so long as the Acts of 1812
and 1844 remain in force, alternations of prosperity
and adversity will continue. That a remedy, at
once easy and safe, would be found in the creation
of a national paper money, to be issued on the gra-
dual repayment of the debt due from the Govern-
ment to the Bank of England; in the payment of
the dividends and Government annual expenses."
This issue of paper money would be limited in
amount the amount proposed being about
£20,000,000. It would be issued in notes of con-
venient amount for general circulation—£l and
upwards—and would be a legal tender in all pay-
ments.

The purchasing power of these notes would be
maintained at an equable value by the obligation of
Government to receive back the notes which they
issue in payment of taxes.

Mr. Spooner observes that the professed object c f
the Acts of 1819 and 1844 was to give the country
a steady and uniform currency, that is, a currency
in which the price of commodities should be steady.
But, "the evidence establishes the tact that not only
are the acts now in force powerless to prevent ex-
treme fluctuations, but that they are the fruitful
source of those, evils, rendering all trading and mer-
cantile undertakings unsafe, and bringing, in a vast
number of cases, total ruin upon those who contract
monetary obligations on reliance upon the continued
value either of money or commodities."

This is a plain but not a bit less a philosophical
explanation of the evils of our moneytary system
The truth is that Peel's Bills produce an effect
exactly the opposite to their professed object.
They " keep the promise to the ear, and break it
to the hope."

Make, said Peel, the bank note convertible into

vv... •
123 grains of gold, and you secure an equable cur-
rency and avoid fluctuations in the value of the
pound and its purchasing power. The bitter ex-
perience of nearly 40 years has proved that the
fluctuations in the value of money, in the rate of
interest, and in the purchasing power of this pound
of 123 grains of gold, have been greater, more
violent, and more ruinous than were ever before
known.

Mr. Spooner has laboured for many years in this
important national cause. Undeterred by opposi-
tion, ridicule, and the calls of self-interest, he has
fought a good fight on the side of truth and justice.
Peel, prejudice, and the common nonsense of the
country, have been against him. But he has un-
flinchingly advocated the 'cause of productive in-
dustry, and of the working classes of his fellow-
countrymen with untiring zeal and admitted ability
and talent.

The currency question is the question of the poor
hard-working labourer and operatives of England,
as opposed to the rich capitalist and money lender.
The bullionists have had their own way. And
what do we see in 1858 P Why the bullionist
committee on bank acts, positively bankrupt in even
plausible sophistries to support Peel's bills, unable
to point out one single remedy for acknowledged
evils, and afraid even to lay down a " general
principle" of monetary legislation !
The poor, weak, contemptible report of the com-
mittee is a triumph for currency reformers in gene-
ral, and for the old, tried, staunch friend of
currency reformation (Mr. Spooner) in particular.