The Sun.
London, England, 1845-08-25 00:00:00

splice at, which it was current before there was any indirect
taxation imposed upon the country. Gold at 31. 17s. J
and wheat at 4s. 6d. per bushel, die very well 200 yeari Ago.
when scarcely any indirect taxation existed; but to attempt to
enforce such prices for the general products of intlestry new.
would be to consign all the productive classes to unremunerated
toil, if not to absolute beggary ; but more especially the agri-
cultural classes, who could not, in their distress, have recome
to steam machinery as their manufacturing brethren could.-
; (Hear.) After some further arguments to show that the low
I standard price of gold peremptorily forbade any rise in the price
of wheat or other commodities, the lecturer directed attention
to a machine he had very ingeniously constructed, called a
currency clock, on which were shown the relative proportions
in value to each other of golil, silver, wheat, and the wages of
labour on the level of an annual taxation by Customs and
Excise of 17,000,000/., which he showed would consist with
435. per quarter for wheat, with gold at. 31. 17s. 1041 per
ounce ; with silver at ss. per ounce ; and the wages of the
labourer at 7s. 6d. per week. These were the prices with
which the country could prosper under an annual taxation of
17,000,0001. But as taxation increased wheat ought to rise
in proportion; and that proportion he maintained, as the result
of close observation, should be-that for every million of indi-
rect taxation per annum beyond 17,000,000/., Is. was necessary
to be added to the price of the quarter o f wheat to compensate the
farmer for the increased taxation he sustained.-( Hear, hear.)
At the present time the indirect taxation was twenty millions
beyond the seventeen millions, so 20s. were necessary to be
added to the price of the quarter of wheat to remunerate the
grower properly ; '2os. added to 455., the:original price with
seventeem millions of taxation, would make 65a. per quarter
for wheat, which he thought would commend itself to every
practical farmer as being about the price whioh he felt would
afford him a fair and not extravagant remuneration.--( Hear. 1
But though the wheat rose, the gold could not rise ; that was
held down by the standard price of 3/. 17s. 10yl. per ounce.
Here then was an absurdity, a distinction in the price of two
things of equal value-one was fetching 635., the other stood at
the scale of only 455. Was that asystem to be established as one
which would exchange equal values fairly and upon equal terms?
-( Hear, hear.) He had now to show them that this fixed,
unvarying price of gold pulled down eventually the prices of
all other productions front a remunerating price to its own
level This was effected by the certain export of gold by the
foreigner whenever, by the high price' of other things, gold
became the cheapest article for hint to take in return for the
goods he has sold us. The foreigner was naturally anxious
to take back a return cargo; he therefore looked route! to see
what would be advantageous to him to buy to sell again ; but
he found wheat at 655. per quarter. " That won't do," says
he, " I can get it at Datexic at :10s. ; I won's take v.heat."
He looked again ; he saw iron at. 6/. per ton. " That
won't do," he says again, " I .can get it at Sweden
at 41. per
..tou." But there was one article which he
saw had not risen, an article too which was the easiest of any
to carry away-gold. Gold has not risen with the other corn.
seodities, and therefore was to him the cheapest commodity,
and he took it. But, says an Englishman to this foreigner,
" You ought not to refuse taking our productions at our prices,
even if they are what you call high, for you have had the benee
fit of bringing your goods to the same mar)iet, and obtaining
similar prices for them, and after all our prices only give us a
fair return for our own expenses." " That is all very well,"
rejoins the foreigner, " but 1 like to take the cheapest which
I can find-your iron, your lead, and your wheat. are all much
dearer than your gold. I like your gold best. I prefer taking
your untaxed gold to your taxed articles." Away, therefore,
the gold went. Suppose this operation to be continued for any
length of time, what would be the ultimate result ? Why, that
the c country, and consequently the Bank of England, would be
dtained of its gold. So long as goods were higher than geld,
geld would be chosen by the foreigner in preference to goods.
-( Hear, hear.) But the Bank of England .being compelled
by law always to provide gold en demand, was obliged to have
recourse to energetic though destructive measures to get the
gold back again into its coffers. Then came the pressure
upon the productive classes, agricultural and manufactur-
ing. The Bank of England knew that the mate of the
gold going abroad was it; comparative cheepnees, and
however grieved it might feel its putting an end to a
prosperous state of things induced by remunerative prices,
stern necessity compelled. The Bank must have the gold
hack at all hassrds, and it took measures for bringing down
corn and I all other produetions, which were so much higher
than the gold to the level of gold, for the Bank knew well
enough that that was the only effectual method of stopping
the export of gold and bringing it back to its own coffers. This
was done by the Bank beginning to withdraw its supply of
notes, refusing discounts, or selecting only the very highest
charaeter!of bills for discount; raising the rates of interest,
contracting its accommodation to country bankers, and various
other methods which it hail at its command. By the use of
these means the general circulating medium became contracted;
everybody somehow or other found himself ahoit of money ;
there was no effecting aales without submitting to a reduction
in prices,and in proportion to the intensity of the pressure was
the fall of prices, which fall only ceased till things were
brought down as low or lower than the price at which gold
was fixed. They were, therefore, placed on the horns of a
dilemma-if the Bark managed to keep the gold is the
country, it only did so by keeping all our produce so low in
price as to ruin the agriculturists and manufacturers, because
they did not get back what they had paid in taxation. On the
other hand, if they got remunerating prices, and paid their
workpeople for their labour, then away went time gold, and the
Bank and our monetary system were both in danger
of being brought to a standstill.-( Hear, hear. )
In illustration of this, the lecturer referred to the panic of 1825,
which he said was a memorable lesson of the vaseillating and
insecure nature of our present monetary eystem. He then
proceeded to consider the causes of that panic. Sir R. Peel's
Currency Bill of 1819, he said, instead of lowering prices only
4 per cent., as its abettors had prophesied, speedily pulled
them down 40 or 50 per cent. Wheat, which had been 705.,
80s., and 90s. per quarter, was brought down by the latter end
of 181'2 to about 38s. ; meat, which had been sold for 4s. 6d.
or ss. per stone, was reduced to 2s. 6d., and other things in
like proportion. This unexpected reduction in the income of
the sellers of commodities, without a proportionate reduction
of the national debt, caused such depression and ruin, that the
Ministers were alarmed, and hastened to relieve the distress by
ComiuMiation"by the country bankers. The end in view was to
increase the prices of goods which had fallen so low • that was
what was wanted, but, as he had already shown, the prices of
goods could not permanently rise without the geld leaving the
country, unless gold and silver were permitted to rise in the
same proportion. The Ministry were told this by persons who
understood the currency, but all argument was in vain-they
persisted in forcing up the prices of goods. while they kept gold
down at 31. 17s. 100., and the result turned out as
had been anticipated. Gold left the country-the Bank lost its
stock of bullion-the nation was convulsed from end to end, and
had the panic continued twenty-four hours longer, Mr. Iluskis-
son said, that a system of barter must have been resorted to.
What was wanted, continued the lecturer, was a system which
would let gold rise in the sante proportion as taxation raised
the price of other things. If gold thus rose it would not be
exported, and a pet manently remunerating price both for corn
and everything else would be obtained. -( Hear, hear.; And
here he would pause to inquire how, under the operation of the
present depressing system, was it possible for the farmer to
avoid pressing unduly on the labourer ? It was the result ne-
cessarily engendered by the operation of the low price system,
and it could not be otherwise, unless they enabled the farmer to
pay better wages by giving him better prices for his produce.
It. was all very easy for gentlemen of the manufacturing dis-
tricts, -who counted their profits by thousands, to declaim
against the low wages of the agricultural labourer, and exult-
ingly to point to the condition of their own work-people by
way of contrast, thus taking credit to themselves for superior
generosity. This, however, was a very fallacious way of look-
ing at the matter. If they really wished to contrast the matter
fairly, let them compare the amount of wages paid with the
amount of profits realised from the wages.-( Hear, hear.)
But in order that gold might be able to rise in proportion to
other things, they must have a kind of currency which
would allow of this taking place ; they must have
another vehicle or medium of exchange: and that could
be obtained by the issue of a fixed amount of Government Ex-
chequer money, based upon the proceeds of the annual taxes.
In such a currency as this, gold could rise ur fall like all other
commodities, according to supply and demand, and in subser-
vience to the amount of taxation imposed upon goods. But
here they dere met with what Sir Robert Peel, and those who
agreed with him, thought an insuperable objection. " What,"
say they, " are you foolish enough to recommend that the
paper currency of the country should be convertible into vote
at the market price, instead of the fixed price that we have
now? Pray what would your pound be ? What would your
pound note mean ? This year, perhaps, gold would be 4/". an
ounce, and then your one pound note would exchange in the
market for a quarter of. an ounce of gold ; next year gold
might be 5/. an ounce, and then your pound note, instead of
being the fourth-part of an ounce of gold, would only be the
fifth-part of an ounce ; and if gold were to rise to 6/. an ounce
then your pound note would be Only the sixth-part of an ounce.
Why, your pound would be always changing, upsetting all
contracts, and alternately robbing ail debtors and creditors.
I No, no ; let us have a pound which is fixed and invariable
in value. Let us have a pound which will always command a
certain definite quantity of gold or silver ; then we know
what we are about. But if the pound is to be a thing con-
stantly changing in value, nobody will know what they are
doing." Ile had put this question in as strong a manner as
he possibly could, because, in the first place, it was an ex-
ceedingly prevalent one, and, secondly. because he was
anxious to grapple with it in its most imposing form.
The whole matter resolved itself into this simple question-
ought or ought not our money denomination, whether pound,
dollar, shilling, or franc, to be or represent at all times and
under all circumstances a certain definite (that was, an meet.-
taMed and invariable) quantity of gold and silver': Sir lie
Peel said it ought. He (the lecturer) humbly presumed to
sty it ought not, and joined issue with him on this point, His
position was, that neither in this nor any other country ought
the money denominations to represent under all circumstances
a fixed anti invariable quantity of gold or silver, and if they
orerthree Sir Robert Peel upon this point, they, upon his own
confession, overturned the whole of his currency scheme, for he'
had said the whole of his measure rested upon that assumption.
-( Hear, hear.) The lecturer next remarked upon the
sources from which the revenue of the country was derived.
Eight-tenths of it, he said, was derived from duties upon com- epee
modities, and the price of them ought to depend upon the
amount of taxation imposed ; for, as Mr. APCulloch had justly
observed, " when taxes are placed upon commodities, their
prices must rise in a corresponding proportion, otherwise the
producers will not obtain their ordinary rate of profit." After
same further able arguments upon the evils connected with a
fixed, unvarying price of gold, the lecturer proceeded to re.
mark that the system regulated the quantity of money in cir-
culation, not by the wants of the people and the demands of
agriculture and commerce, but by the quantity of a certain
foreign metal which it was probable could be procured by the
Bank at the price fixed for it ; and there was no class of •
persons whose interests had suffered so much from this cause
as the agricultural class. In London and other great
towns great facilities were afforded by bills of exchange
and promissory notes, so that the pressure which would other-
wise be felt was relieved in a great degree by these substitutes,
Rut in the country districts, where bills of exchange were
almost unknown, the want of an abundant supply of circulating
medium was most severely felt, The lecturer then alluded to
the restrictions placed upon the issues of country bank sby tL s
recent Act of Parliament; after which he said-However
clear and demonstrable this subject might appear to himself
and to the meeting, yet he was aware that in an assembly of
thinking men to whom a difficult subject, had been for the first
time brought under their consideration, that some suck
thoughts as the followihg would be prevalent :-" Well, it up.
pears, as far as 1 can judge, very plain anti very true; but Si
E. Peel and other eminent men are of a different opinion, add
I wonder why this is : they surely must see the subject in some
other light, or perhaps they are acquainted with something
more respecting it that has not been brought ferward by the
lecturer to-day. 1 should very much like to hear a little more
of what such parties as those have to say to it. I should lib*
fully to undtrstand the opposite opinion, that I might be ah
fairly to judge between them, for at present I have only hoaxes
one side of the ques•ien." lie (the lecturer) would tlseeefeee
to the best of his ability, and without knowingly witititoh:dt„
• anything, give them Sir R. Peel's view of the subject
as St
forth in his public speeches upon the questions,and the a
leave them to draw a fair comparison between their view..
Sir R. Peel's view appeared at first sighs.
',rue, to
os
fb:r ase tr
correct and simple, and indeed it wee
went, for it was wrong rather because it .
was Incomplete
was
el f ab necessarystraet d 1 tvo. b e
eo
Sir nit:.
and did not embrace all thattn
sidered, than that. it was wrong
Peel's philosophy of money appearrag to be embodied-in the
instrument fel. •
lewing reflections ;-" What is atone) ?" He
" The measure of value, that is flit) answered
we rise cc mite of