The Sun.
London, England, 1832-09-14 00:00:00

houses and Niniture are to be obtaine'i, which means Are

commonly called capital is in that way that our po-
pulation has been mainly employed in the last ten years, by
the building of bouses for the new population to occupy,
and for small capitalists to reside in.
Do you think the increase of small houses, for persons
of small fortune to reside in, is a proof of the increase of po-
verty in Birmingham?—Half of them are buil•, to my
knowledge, by insolvent men, who fail a year or two after
they build them.
Who supplied the capital to those insolvent persons?—
The creditors of the insolvent.
Where do those creditors reside ?—Principally in Bir-
mingham.
Then it appears that those persons who supply capital
to those insolvent people are natives of Birmingham itself,
and therefore the larger portion of the capital for building
those houses has been supplied by Birmingham itself?—
Undoubtedly.
If there has been a capital accumulated in order to
build this large number of houses, which has encouraged
a number of persons to come and live there, is not this a
proof of there having been profits of trade to that extent
in Birmingham ?—Unquestionably not ; those profits
were made solely during the war ; theze have been no
profits since the war, in Birmingham, by any regular in-
dustry whatever, except, perhaps, i❑ the building of
houses, which has been so extensive a trade, that I am
not willing to say there has been no profit made upon it ;
I am sure there has been no profit upon any regular Bir-
mingham trade in the last seven years.
You stated that when there was a fall in the vale] of
money, a reward was obtained for production which called
labour into employment, and that the productive powers
of industry were then put upon their full stretch ; would
not the effect of this be to occasion a much greater mass
of commodities to be produced, and, in the end, to pro-
duce a corresponding fall in commodities ?—I think not.
Did you ever know a case of the productive powers of
industry being put upon a full stretch, with a considerable
rise of prices, which was not followed by a corresponding
fall, and mercantile distress ?—Unqu-stionably ; there
would have been no fall in 1825, but for the contraction
of the currency ; the consumption ef Birmingham goods
and Manchester goods in 1825, at high prices, was much
greater than it is now at low prices.
Did you ever know an instince of a high excitement
taking pl .ee, and the productive powers of the country
being put upon their full stretch, when it did not occasion
a large quantity of commodities to be produced, and that
to be followed by a corresponding fall and mercantile dis-
tress?—lt will occasion a large quantity of commodities to
he produced, but it will not occasion a corresponding fall,
the production of commodities being only effected by ac •
eomplishing an equivalent consumption, either through
the medium of wages, rents, profits, or taxes; I mean
that we do but facilitate and increase production in every
process of production. If we put 1,000,0001. extra in
operation in the iron trade in one year, we pro !n•e
1,000,0001. of extra iron in one year more than is now
wanted ; but most certainly in so doing we accomplish the
consumption of 1,000.0001. more of beef and beer, and
other commodities, which the labourers receive and con-
sume ; and if such action upon the iron trade is made ge-
nera upon all trade, the increased production of all trade,
and all agriculture, consumes the 1,000,0001. of txtra
iron, and the machinery of society works beneficially and
harmoniously.
Then you think that in that case the increased quantity
of manufactures that has been produced, is taken off by in-
ternal consumption ?—Unquestionably.
Da not taxes raise the prices ?—No, I believe not ; no.
thing raises prices but the action of money, either real
money or credit money ; in fact, nothing raises the prices
pet manently, but increasing the money in people's pockets,
and facilitating, the consumption of the country.
Then do you think that the more you depreciate the
currency of the country, the greater power of consumption
you have ?—Till every labourer i❑ the kingdom is fully
employed, I have no doubt of the truth of that.
What, in your opinion, forms the fund for the employ-
ment of the labourer ?—The circulating medium consti-
tutes the fund. _ _

Do not you consider that capital alone forms the fund
of lrbotir ?—I hardly understand what is the meaning of
eapital.
Do you consider that the circulating medium is capi-
cal ?—I understand by capital generally all money, all
land, all houses, and 311 property of all kinds.
Do you not consider capital to he property of any de-
scription which can be employed in production ?—I call
that capital.
Do you call fond and raiment capital?—All the good
thins of life I call capital.
If the definition you have given of capital he correct, and
capital be a fund of labour, how does the circulating me-
dium, which is not cipital, tend to increase the fund for
labour ?--The circul sting medium is the organ which con-
verts the capital into the uses of the country ; I would
beg to explain it by representing a draught board, which
contains perhaps 1,000 masses of commodities, a mass of
iron, a mass of wheat, and a mass of clothing, &c. ; this is
the division of 1 ibour in England. The possessor of the
iron cannot ceed himself with iron, the possessor of the bread
cannot clothe himself with bread ; but these mutual masses
of mutual wealth derive their convertibility into men's uses
solely from the action of the circulating medium. If the
eitculating medium is equal to the duty of covering a range
of the prices of those masses equivalent to the taxation,
and the waees and monetary burdens which the habits of
society impose upon their production, and also equivalent
ti leave a moderate profit to the producer above those
charges, then the interchange of those commodities for
each other, and for labour, or rather the convertibility of
those commodities, is ample and efficient ; each possessor
of iron is enabled to exchange his mass of iron for such
proportions of the masses of all other commodities as his
wants, or those of his workmen or dependents, may re-
quire; but it the circulating system becomes contracted by
any means so au to break down the prices of those commit-
alities within the range of the fixed monetary taxatio❑ of
many kinds which habit and law charge upon them,
then the machinery of convertibility is destroyed, and
those masses are inconvertible into the uses of man,
and they exhibit the terrible phenomena which we now
witness, of a country in the midst of abundance and po-
verty at the same time ; in other words, as I have often
expressed it, the country appears liAflies in a sugar bottle,
destroyed in the abundance of their own sweets.
You have explaired the manner in which the circu-
lating medium operates as a mere exchange between dif-
ferent commodities, you have stated also why a depreci
ation should relieve parties who are already burdened with
fixed engagements frotn some portion of those fixed en.
gagements ; but trill you state how you consider that an
augmentation of the circulating medium, carrying with it
a depreciation of the value of money, can add to the power
of production or of consumption ; if, for instance, the
circulating medium be in such a state that one
piir of shoes exchanges for Is. and one hat ex-
changes for 1g.., and if such a depreciation of the cir-
culating medium takes place as that one pair of shoes shall
be worth 2s. and one hat shall be worth 2s. how is the
producer of the hat to be able to consume more shoes than
before, or rice versa ?—ln this way—the producer of the
hat selling his hat for 2s. instead of Is., finds the pressure
of his fixed charges thereby broken down and reduced ;
lie finds also a profit in his trade; he puts his men i❑ full
employment, and puts Ilia monetary capital in full opera-
tion and his credit ; as fast as he produces a hat, which
be sells for 2s. he or his workmen expend t at 2s. either
in the purchase of shoes or some other commodities; and
this action being general upon all the productions of in-
dustry, the whole industry of the country becomes libe-
1-toed front its thraldom; every trade has got a reasonable
profit, and every labourer is brought into beneficial em
pioyment.
If the produc r of the hat can only exchange his hat
against one pair of shoes, or against exactly the same
amount of other commodities that he had before, will y u
state how his woks could be increased?—lf he can only
sell his hat for the shoes, the mere elevation of price would
probably not be a great benefit, because he would have to
pay in his put chases as much money as he receives in his
sales ; still his industry NV, uld lie litierated, and he would
bavP a profit, because the fixed charges which law and
11164 impose upon his trade now being reduced, would
leave a great proportion of the products of industry in his
own hands ; at present, the products are carried off from
the producer's bands.
Then you consider that he would get no increase of pro-
fit except such as arose from the diminution of his fixed
charges?—And his industry being set free, he would have
a beneficial employment for it.
Then the liberation of his industry will be dependent
upon the diminution of the fixed charges?—l beg to ex
plain : in case of his selling the hat for Is., instead of 2i.,
I presume that it would be a very ruinous trade; sup-
posing the fixed charges probably to be 10d. or I Id. upon
the hat, of course his business stagnates and is ruinous.
Now it there is a rise of price to 25., and the fixed charges
remain still fixed, they leave him a profit, the consequence
„f which is, that he immediately produces more hats, and
has a beneficial trade; the shoemaker feels the same ac-
tion upon his trade, and the thing resolves itself into a
greater proportion of industry being employed beneficially
TO BE CONTINUED.

The dinner of the electors of the Tower Ham-
lets, to commemorate the posing of the Reform Bill, will
take place on Monday next. Mr. HOME will take the chair.

XXIX.

An ESTIMATED ACCOrNT of Profit derived by the Bank from

Government Business.
Circulation .0,000,000/.
Government Deposits.....

••••••••••Z
Of which two-thirds are estimated to be invested in securities,
and one-third in bullion.
Securities, 16,000,0001., viz.-
9,000,0001. Exchequer Bills, at 21,y
per cent 202,500
500,000 Stock, at 3 per cent 24,000
1,000,00) Advance for Circulation on
Discount, at 3 per cent. 30,000

500,000 Country Discount, at 33.
per cent ............ ........ 17,500
4,700,000 at 41,c, per cent ....... 193,875
------ 467,875

16,000,0001.
Deduct—
Expense of Circulation
Expense of Government Deposits...— lO,OOO
stamp Duty on Circulation ... 70,000
One per Cent. on Capital (held by Go-
vernment at three per cent: 147,000
333,000
104,875

THE PUBLIC DEBT.
Amount received from Government
for Management of the Public Debt
for the year ending April 5, 1332, in-
cluding Life Annuities '251,000
Management of Life Annuities, pro-
posed to be transferred__

3,000
-- 248,000

Deduct—
Expense' for Management of the Na-
tional Debt
Average of Forgeries per annum,
during the last ten years.... 40,000
-- 204,000
44,000

Esti►nated Profit 17.,675

XXVII.
An ACCOUNT of the Amounts of the Net Annual Profit of the
Bank of England, in the Years ending the 28th Feb., 1829,
1830, 1831, and 18112, out of which Interest is to be paid on
the Capital Stock.
In the Year ending February 28, 1829
- 1830
- 1831
29, 1832 1 212:80 931:5
674 81.288 t.3:5-)

4,544,980