The Sun.
London, England, 1857-01-24 00:00:00

THE BANK CRARTEIt ACT OF 1844.

(Front the Derbyshire Courier.)
A second letter, and more carefully prepared
than his former one, has been addressed by Mer-
cator to the Times in support of his theories.
This letter does not appear to us to establish any
new fact, or to adduce any novel argument for the
renewal of the measure of 1844. It is, in tact, a
professed free-trader's apology for a system of re-
striction and monopoly more stringent than any
other ever inflicted on the commercial world. And
this principle of restriction and monopoly the act
of 1844 app ied to that which, above all other
things, ought to be " free as air," viz., the uni-
versal medium of exchange—money.
Mercator defends the act of 1844 by which the
restrictive monopoly of issuing 14,000,0001. of notes
against the government debt and government se-
curities !was conferred on the Bank of England.
Even the Times can perceive the absurdity and in-
justice of this enactment--the absurdity of govern-
ment having to borrow from the bank notes issued
against national securities for which interest is, at
the same time, being received by the bank ; and
the injustice of conferring on the Bank of England
exclusive privileges which injure the country with-
out benefitting the bank itself.
Half of Mercator's letter is employed in attempt-
ing to justify this narrow and antiquated system
of restriction, and the other half in opposing the
notion of any "relaxing power" being entrust,'
to the bank directors. Mercator is here, no doubt,
logically right. If the principle of the bill of 1844
be worth anything it ought to be carried out to the
letter. To establish a principle for the self-regula-
tion of the circulating medium of a nation, and to
relax the principle just when it becomes actively
and powerfully operative is the extreme of ab-
Barclay.
The Bank of England grew up under a system of
restriction and protection. Those who advocate
this system are consistent in advocating also the
extensive privileges of the bank, and a " strict
limitation" of the amount of notes issued by other
banks, but Mercator, who attributes all the com-
mercial prosperity and progress of the nation to
free trade, ought to be the last man in the country
to support such a system.
We speak the opinion of experienced and un-
prejudiced commercial men when we affirm that
the Bills of 1819 and 1844 have caused, on several
occasions, in one year, greater loss and ruin in this
country than the failure of all the Banks of Issue
put together, when they had the power of what
Mercator calls "unlimited issues." The loss to
the nation by the failure of large Banks of Issue
might be estimated by thousands of pounds ; that
which we suffered in 1819, 1825, 1837, 1839, and
1844 must be estimated by millions ; and let it be
remembered that the effects of these periods of
commercial depression and panic were not confined
to merchants and traders, but brought misery,
urging the people to the very verge of revolution,
into the cottage of the labourer and the cabin of
the artizan.
But if these two letters of Mercator be little re-
markable for that which they contain, they are
very remarkable for that which they do not con-
tain. They contain no reference to the panic of
1847, or the Gold Discoveries of Australia and
California.
" The first great object of the act," he says,
was the effectual maintenance of specie payments,
and the suppression of all real danger and of such
reasonable alarm and apprehension upon the sub-
ject, as occurred in 1825, 1837, and 1839."
Mercator well knows that the Bank had in its
Banking Department, on the 23d day of October,
1847, only 447,2461. in gold and silver coin, while
the notes in active circulation in the hands of the
public amounted to 20,318,1751. This is his
" effectual maintenance of specie payments."
Mercator knows that " real danger and reason.
able alarm," extorted from Lord John Russell and
Sir Charles Wood the letter which was to all in.
tents and purposes the suspension of the Act of
1844.

Mercator knows that the House of Lords' Com-
mittee of 1848 condemned the Bill of 1844 in the
most decided manner ; and that a similar con-
demnation by the Committee of the House of
Commons was only narrowly escaped.
Can any hardihood of assertion, therefore, be
greater than that of a writer who affirms " that the
Act has fully accomplished all that was expected
from it in this respect admits of no reasonable
doubt."
But what has Mercator to say in defence of his
omission to estimate the influence which the Gold
Discoveries have had in enabling the Act of 1844
to remain so long in existence
Mr. Macculloch calculates that the " total avail-
able annual produce of the precious metals from the
American, European, and Russo-Asiatic mines,"
before the discoveries in California and Australia,
was 9,050,0001. Since those discoveries (1849)
130,000,0001. of gold alone has been sent into the
market of the world.
Can Mercator, as an honest arguer on the Cur-
rency Question, ignore this fact f
Whether he do so or not, the public will never
be persua 'ed that this enormous influx of gold
has not produced the most important results.
Many will think with us that without this gold,
Free Trade and a Restricted Currency would have
enforced the repeal of the Bank Charter Act before
this ; and that a greater amount of misery and
ruin would have- resulted from this measure than
was witnessed in 1825, 1837, 1839, or the disastrous
period of 1847.1
And as to the good which these extrarordinary
discoveries of gold have effected, the monetary
system established in 1819 by Sir R. Peel, and
made more restrictive and oppressive in 1844 by Sir
R. Peel and Lord Overstone, has checked and
diminished the advantage which the people of
England would otherwise have derived, and re-
tarded the progress of the nation.

ts everything of the
universe," says Emerson, "and
with one of my friends who peisc I compared notes
ex
A WORD TO THE
disappointedMAßßlED.---‘`
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,
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towards which so many of our married friends have been
lured, until too late to save themselves from tumbling
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