The Sun.
London, England, 1828-06-04 00:00:00

of the holder, the case assumes altogether a different cern:
plexion. The next point is, the means possessed by the
country fer substituting a metallic currency for this amount
of circulation; and I can pabany upon this point, that on
examination, it appears that the amount of gold available
for this purpose so far exceeds what can he calculated upon
as the amount of small mites in circulation, that there can
be no doubt in - any rational mind of the ability of the
country to supply the vacuum.—(Cheers.)--Bat it may
be said, there will". be some difficulty in distributing the re-
quisite amount of gold throughout the country. Here
again I am happy to say, that the amount drawn from the
Bank to different parts of the country is such as to leaves '
no doubt that there-is more than amply sufficient already
distributed to meet the demand in all quarters which may
be , gee:taloned by the withdrawal of the small , note
circuletioo.—(Hear, -hear.)—lf, therefore, the amount of
small
,notes in circulation, does not exceed, 2,400,0001. •
and there aa.supply of gold more titan sufficient to meet
the withdrawal of a much larger amount of paper currency
from circulation, and it appears that the withdrawal need
not be sudden hut gradual—what apprehension, I ask, can
there be upon the score of this Bill going into complete
operation ?—(Hear.) The qUestion, Sir, that we have to
_decide is, whether or not we shall adhere to the law of
1826. , I am quite willing to meet the Hon. Member for
Callington (Mr. Attwood), in placing this question upon
the mere grounds of expediency. , But then, when we talk
of expediency, I do not understand by that word the giving
up of some future good to obtain some present advantage.
I speak of that,sort of expediertcy which takes a view of
thepast and the future, and legislates for permanent good.
—(Hear, hear.) Upon that groond of expediency, I re-
peat, 1 have no fear of the full and beneficial execution of
the Act of 1826.—(Hear, hear.) For, I am confident,
Sir, that if the question be judged upon these principles—
if we 'took at the, past and see the dangers and alarms
created by a paper currency, or to the future, and contem-
plate the consequences of an indefinite small note circula-
tion, and the question he decided on both these views, the
House will be in unison with his Majesty's Government,
and the law of 1826 will be maintained. Sir, I confess I
am at a loss in considering this question, .to understand
how those who supported the measures of 1819, for the
restoration of a Metallic Currency, can now support a
measure.for the indefinite continuance, as I shall show
hereafter,. of the Small Note circulation. The House will
recollect that the circulation of Small Notes was not intro-
duced as a benefit to, the community. It was done as the
, remedy of a great evil, Small Notes, Sir, were the off=
"spring of the /tank Restriction Act. Their circulation fol.".
lowed immediately upon that Act—they were made for it.
And the Acts authorising their circulation were renewed
as that measure was. renewed, until at last Parliament
made the continuance of the one contingent 'on the other.
We know, that. so long as there are small notes in circula-
tion, gold will not circulate. There is a natural antipathy
between the one pound note anti the golden sovereign,
which inevitably causes the one to drive the other out of
circulation, and we, therefore, must deprive ourselves of a
currency in gold, so long as we allow small notes to circu-
late. The law established by Parliament declares that the
circulating_ medium shall be in cash and gold, while the
continuance of, these notes prevents that salutary previe
sion from taking effect. But, Sir, the House of ConamOns
witnessed quite enough in the events of 1825 and 1826,
to induce it to support this measure. I need not recal to
the recollection of the House how much of the alarm,
which produced such frightful consequences in that day,
originated in the extensive issue of small notes, which it
was the object of the .Bill of 1826 to restrict. I do not
say that all the evils of that day were caused by the issue
of small notes, but I do say that the evils were greatly
aggravated by that cause. It mattered not whether the
alarm were well or ill-founded—it worked the same
effects. It was impof Bible for the , holders—poor and
ignorant in the mass—of the small country notes, to dis-
tinguish betwixt firms which were solvent, and those which
were not. The alarm naturally communicated itself to
every holder of a note. I knew an instance of one country
town in which the bankers were perfectly solvent, and yet
, so undiscrik-ninating was the panic which seized the people,
that their one pound notes were actually sold in great num-
! hers for 18s. on one side of the street, whilst on the other
! side the Bank was paying them in full, and continued so
to do till they had satisfied every,demand. It is to be
observed, Sir, that the holder of a twenty shilling note
is more exposed to the operation of alarm than the
holders of larger sums. It is of More importance to him,
frequently being all the property he." possesses. I do not
mean, Sir, to deny that the small note circulation has been a
great convenience in different parts of the country. I may
be permitted to ask , if there be any one who has had any
experience, or who has perused history, who doubts that
metallic currency is essential to the prosperity, and the se-
curity of this. country ?_(Hear, hear. )—Some persona,
Sir, admit the expediency of a return to cash payments ;
bat argue that thus is not the time to withdraw the small
notes. But, Sir, if this he not the time, I confess I can•
not anticipate the time that will be favourable for that mea-
sure.—(hear, hear.)—l maintain that the House is called
upon to declare this night, whether thesmall notes shall
now be withdrawn or never. Circumstances never Were
so favourable fer the measure. We have fresh in our re-
collection the alarms of 1825 ; the issues of these notes
have been gradually growing lees in amount, and the
quantity in circulation is now -less than it has been for a
long time. If the Parliament, however, will now turn
back and yield to those demands, there is no knowing
when the House can be bold enough again to venture on
withdrawing this circulation. The country is now pre-
pared for it, not only by its knowledge that the period for
the purpose was approaching, but also by the prurient and
judicious conduct of the country hankers. They have
taken measures for the reduction of their circulation, and
they have provided gold enough to give stability to their
business. Gold is also, by other means, abundantly dis-
tributed through all parte of the country. But who can
say; if the measure be not now effected, that there can be
any guard against the excessive issue of paper. I know it
is said, if it be allowed, that the result will be greatly
fkvourable to the operations throughout the country, but I
also know that another result, an inevitable one, must be
the recurrence of the greatest distress, in, the event
of which we shall , then be called on to 're-enact
this measure fir the suppression of sniall notes,
aid of eonrse be held up as an object of ridicule
to all. who (Wire to see our currency fixed upon a
correct and stable principle. I cannot help thinking that
those who enlarge on the great inconveniences to proceed
from the withdrawal of small notes, argue on principles
entirely erroneous, I do not believe that it will either
contract the circulating medium, or limit the advances
made by country bankers,. nor do I either believe that it
will diminish the rents and profits of land, It may not be
nnimportant to know the amount of the present circulating
mediutn, whether composed of the notes of the different
bankers or of gold, not from ignorance that in the country
there is a vast amount of other circulation, but because I
wish to show how small the quantity of this ,species pf cur-
rency is us compared. With the pneFal circulation, and
how very limited must be the effect of its . with-
,din's). The circulation, then, of the country is, ac-
cording to the rstern which I now hold in my hand, at
present—
Bank of England Notes
~£20,000,000
CountryZa4kers' Notes over Five POunds:.. 10,000,(:)00
Country Bank .Notes under Five Pounds.,., 2,00,00
Sovereigns at present in circulation.......'.,. 22,600,000
Silver Coin
Thus making the total amount of present
65 500,000
circulation
x,_

manner at present hoarded throughout the country. The
circulation, then, in that period, was—
Guineas 4,000,000

Bank of England Notes, IF.
Country Notes of Same value 10,700,000
Silver, including Bank Tokens 7,000,000

Making in the whole aly.ut £29,000,000
of small currency. . The amount in circula-
tion, during the next period was 29,200,000
and from ISIS to 1821, it was 25,400,000
In the period next to that, and the amount of which con.-
tinues to the present period, the amounts issued were—
In Gold £7,000,000

Gotd, in exchange for the Guineas 4,000,000
Issued for the. general use of the Country 10,000,000

Thus making► the total in Gold .02,000,000
which, with Silver 8,090,000

. .
makes the whole of the present circulation in specie
30,000,000/. If then, at former period's, when, the greatest
activity prevailed in iheinercantile and Other interests, the
whole amount of' the citculating medium was but.
29,200,0001. e I do not think there can he the, slightest
apprehension; but that with a circulation of 30,000,000/.,
the country will he able to meet every demand. It has
also been stated, that an adherence to the law will diminish
the power of bankers to afford the accommodation they were
formerly able to de, but on this subject I entertain very,
considerable doubts. It may, 'perhaps, he true, that this
withdrawal may diminish the profit derived by country
bankers, by whom small notes are issued; but we also
know, that those bankers themselves haVe declaied that the
profits derived by them from this source are (lithe insigni-
ficant, when compared with the other branches of their
business, wherefore, when' we speak of the power of the
bankers to aceotairinidate being diminished; we must also
consider that diminution to be merely in the proportion of
the loss of their profits upon their issues, which they dee
dared to be that portion of their businese which produces
the least profit. 1 will, however, go farther, for I will say
that this very measure will increase their profits, as they
will thus not he liable to the sudden demands which this
species of issue subjects them to, and thus give them greater
confidence and stability; and on the principle that the
liberality of bankers is in proportion to the security from
inconvenience, I am of opinion: that the absence of this
small note circulation, With its accoinpanimente of runs
and panics, will, instead of being a hindrance, in fact con-:j
tribute to render them more instrumental in forwaiding
the commercial interests ,of the country. I ' would also
,aele, is this one pound note circulation necessary? Is there
not a large portion of the country where there is no such
.issue? • Is there not Lancashire, for instance? . And I
will ask whether,any one acquainted with that part of the
country will deny that there cannot be greater accommoda-
tion extended to manufacturers and traders any where than
there, or -in Which advanced' and cash credos are more
favourably made than in that pert of the country where
there are one pound notes. S Under these considerations I.
am induced not only to press the motion on the House to
grant me permission to bring in the Bill, with the motion
for which I shall conclude, but on the same consideration
I will implore the House to resist the motion with which
it is menaced by the Hon. Baronet opposite. I know that
his motion is shaped inn captivating way, being merely for.
inquiry; he is too dexterous a tactician to seek at once to
acquire that which would at once be refused him,' the re-
peal of the Act of 1826, but I know the Hon., Baronet
will admit, that he and those who act with him look as the
result of his motion to the repeal of that Act. With this
view it is that I rre et the motion of the Honourable
Baronet, and if he should succeed this night, 1 have
no doubt that his good fortune will have an effect far
beyond what he anticipates. Whatever may 'be his views
and however limited his designs, let us say what ire will,
if his motion be agreed to,
,the impression will be general
throughout the country, that the Act of 1826 is ' to he ree
pealed, and that the establishment of the'Small Note Cire
culation by law is in 'contemplation. I think that this
alone would be productive of not only a great, as iminie
nent, but a permanent evil ; but by the decision on the
motion, with which I shall conclude, I hope the HOuse
will evince its determination to act on that system which
it supported in 1823, and which, with some occasional va-
riations, has been that acted upon ever since 1819:
In consequence of some obServations across the table,
' The CHANCELLOR of the EXCHEQUER observed,
I stated in the outset thee while the circUlation of small
notes continued in England, that of Scotchnotes was not
to be prevented. My design also is, that those who cir-
culate Scotch notes should he subject to a Firnilinjurisdic-
tion with that provided against persons guilty of violating
the Vnilisli Act of 1826, namely, that of being brought
before a Magistrate, and being amenable to a fine. I shall
now move that leave he given to bring in a Bill to restrain
the negociating in England of promissory notes, and Bills
of Exchange tinder the value of 20 shillings issued in Scot-
land or Ireland.
On the SPEAKER putting the question,
. Sir .I.' GRAHAM said, I always feel einbarraseed when-
ever I rise to address ' the House, and I must say that I
feel more so thin ordinarily at present, from the considera-
tion I entertain of the great magnitude and difficulty of the
subject lam about to speak on. I will not; hoWeyer, en-
large further on this topic than to say, that I shall endea-
vour to merit indulgence by not wearying the House, al-
though I feel that my difficulties are consideredly increased
by the course taken by the Right Hon. Gentlemanoppo-
site, which, although I entertain no doubt of its correct-
ness, appears to me to be very uri4ial. His notice on the
paper is for leave to bring in a'Bill to restrict the 4ircula:-
tion in England of Scotch small notes, and I appeal to the
Reuse, whether he had not, until it was recalled to his re.:
collection, discussed every other part of the question save
that ' which relates to this standing anomaly—the paper
Currency of Scotland and Ireland. In the commencement
I shall, apply myself to that which has latterly fallen from
the Right Hon. Gentleman. First, then, he says that
those who were friendly to c tsh nayments in 109 will
in
act inconsistently nowif they vote support of nieNsThotion,
Upon this subject I can only say that at,that period I had
the honour of a seat in this House, and that I then voted in
favour of the measure of the Right Hon. Gentlethan at the
other side (Mr. Peel). I. was then a very young Member,
and certainly I did then believe in the correctness of one of
the most palpable fallacies which was ever palmed on any as-
sembly. I then, however, deferred to the authority of a la-
mented and respected friend now no more,l mean Mr. Ricardo,
who stated that the whole difference in the standard was to
be estimated only by the difference between the price nf gold
iii the market and the Mint price. ' Yielding, then, to the
force of this poiltion, which I new hOld a most palpable
fallacy, -I did then, inadvertently, unwisely, and unhappily,
give my support to the measure of the Right Hon. Gentle-
man ; wherefore I admit if the charge of inconsistency be
urged against me I must with patience submit to it. But
no fear of a charge ef this kind, after an error 'is perceived,
ought to prevent any one from
,avowing his having fallen
into that error ; and this avowal I stiall'therefore oppose to
any charge that may be made ' against 'me on this head. I
think that the Right Hon. mover has been very vague in
his statements as to the amount of the circulation; but to
this I elo not object, as it falls in with the scepe of the
rnoliOn with 'which I mean to conclude, •• if hiS state-
mentsbecause,
can be well borne out by evidence, the Committee is
the most proper place for the examination of that evidence.
1 shall not go into the Cominittee if the House consent to
grant it, with my mind entirely,made up against the law of
1526 ; but I certainly shall do so 'With a strong bias of the
inexpediency of carrying it,ieto effeCt ; bet at the same time
Lam open to conviction, and, if
rall that the Right Honour-
- 'able Gentleman has stated to-night he" made out, 1 shall
Now if we eceasparee this 2,500,0001. with 65;500,000/. cordially agree in the propriety of that -Jew. One of the
only consider how small 41e• proportion the one bears to facts stated by hint, I consider extraordinary, namely, that
of there being 22,000,000 of sovereigns in circulation I
whether, the
.Riebf.lion. Gentleman means
the other; and that this will at the eteeeist be but a re-
duellers' of three and a half per cent. on the whole cirstela- do not kn.ow..
a e4e.eeheee is thoi suns exclusive of the treasure in the coffers
thin, 'which too is not to be made suddenly, but atier
. .
considerable
(pee iod,and we can at once perceive' how 'small of the . ,
Iv, The CrIANCaLQ4 of the E.--C41;91144,77-Yes
Beink7 ,
aN w effect the withdtaalof this sere must produce.
aboundalio take inin 'COneideisition that 600,804. of this certainly.
. SireJAMES GRAHAM—For this I certainly was cwt
2,1-.)00;000/:will
0 io augmentation of the issue of 5/-
notes, and that the rema'tpeler will he fully made up by, prepared, yet, as there is no seignoi age paid on all the gold
the supply of gold and of Silver ghee, if that should be nee, ,that goes out ef the Quetta,' the Itighe lion. Gentleman
costars fur the support ef the circulation. 'BUt it hag beep cannot be prepared to state that all this amount Li in circe.
!aid, that itie not with reference to the general circulation. latign, a., there: ie ep possibility of knowing howy. much
that 'Spill notes are necessary, but to the minor circula- may be expeited, Or what tittantity may be melted dawn.
tion 1 -isil titat if they be withdrawn, the people will not Considerable stress was laid; by the Right; Hen. Gentle-
he able to pay laboUi.4s w;ii luny earn from 1/. to 21. ; man on the supposition, that if the measure of 152f1 be
and that, consequently,* if withdrawn, s%::-Al districts will J carried into effect, the rush for gold will not be simulta-
untlerge a great pressure of distress. .1 will, in Oesler.P nexus. But he will, however, lam ;persuaded, agree with
meet this argement, beg the House. to. consider what has ate that every prudent country banker must be prepared
been the circulation a the country at different periods .on the sth April, e,o meet all. his outstanding: circulation.
anterior to the passing of this measure, periods too, when Tints, although the whole amount may oat come in, ye; the
the commerce of the country was in its moat busy state; country banlier must be ready, and, therefore, as regards
the effect on the currency, it is AO matter whether there
and if they shall be. convinced that the present ciScge
lotion is not only equal, but superior, to that at those may he a call meek on the country bankee for specie or
periods, when no complaint was uttered, it will, I . Bank of geglend notes, which, unless they be immee
think, be a great caniolatioo to thou who • anticipate Idiately exchanged, must inevitably curtail the circulation
so much evil from the measure of :1826. I have of the country. The Right Hon. 'Gentleman has also
divided the tirae from 1810 into perioda of four years said, that small notes were not kuowp until after the Bank
each, bemuse by tut doing I take the total amount of Restriction Act, lint he sorely meet forget the Act of the
country bank motes then issued, as being, the amount of 19th of the late King, when, Sp ;9 ng ago as I'ilB, there
the circulation at these times. From 1810 then to 1813, were provisions adopted to regulate thieepeciee of currency.
I will sly that there were 4,000,000 of guineas, e Will not He has also spoken pf Lancashire as ,a . place where there
say in circulation,- bat in the country.
haps, hoarded or stored; They
but they ate to he taken into ace which
were, per- Are no small notes, bot I believe there are.fiye banks there
40 issue them; and, although they do not, in the
count, as they were afterwards exchanged for sovereign% gross, form any considerable proportion of, the general cir-
of which, I dare say, there may be a similar amount in like cuiation, yet 1 most remtiwi the Honor,' thjt _there, is