Star.
London, England, 1818-05-02 00:00:00

portion likely to be remitted in-the talentation of the
reach contribution, he could may speak from ru-
mour: he knew nothing on that' subject which could
justify him in making it the ground of calculation—
...a/tear, hear, from Mr. Tierney.}—When the House
sa w such a state of things, and recollected that at a
lomwr period the Directors of the Bank said that a
second Austrian loan of three or 4,000,0001 would
le fatal to the Bank, and induced Mr, Pitt to admit
the propriety of their remonstrance, ana nrcommend
an attempt to neg•ociate the loan in Bpain--es
Mr. TIERNEY—" What else did he say ? and
was not the course pursued at the time dictated on
the spur of the occasion, and under the pressure of
the hasty alarm which prevailed, and without any
proper consideration of the financial state of the
Country ?"--(Hear, hear.)
The CHANCELLOR of the EXCHEQUER re-
vered, and said, that if a loan not exceeding three
br 4,000,0001. caused such serious apprehensions at
that period, how great ought to be the caution ob-
served oa an occasion of this kind, when the loan to
be negotiated amounted to 30,000,0001. sterling ?
When the authority of Mr. Pitt was quoted, the
House would do well to recollect, whether they
would adhere to the course laid down by the uni-
form supporters of that Statesman's principles, or at
once adopt the maxims of those who uniformly vili-
fied his whole course of proceedings—(hear, hear,
teen the Oppoaiox Brudies.) The Right Honour-
able Gentleman had certainly been successful in point-
ireo out rho errors in the preamble of the Bill ; there
was certainly a mistake in it—but it was his intem-
tion to rectify• it in the Committee, as it conveyed
an unfounded reflection on the Bank ; for this spe-
cies of negligence he admitted he was culpable in
allowing the preamble of the former Act to be ver-
bally copied for the new Bill. It was true that Mr.
Fitt had referred the affairs of the Bank to a Corn-
/niece, but he had done so under alarming and un-
foreseen circumstances, and not in such a case as the
present. The proposed question was, to consider
what inconvenience weuld be sustained by a resump-
tion of cash payments? to this he would reply by
patUig another question, what inconvenience would
arise from prolonging for another year this resump-
tion?—(A laugh.)—The Committee, if appointed,
could take no prospective course; for how could they
foresee the events of the ensuing year ? As to the
foreign loans, these could only be said to have imme-
diate operation—their influence was any thing but
permanent; they must be closed in less than twelve
months, and from the nature of the circumstances to
which they applied they were not likely to recur. On
the subject of Country Banks, the Right Honour-
able Gentleman had laid it down as illegal and un-
constitutional, to question the right of individuals to
issue a paper circulation on their own security.—
(Mr. Tierney, " I merely questioned the policy.")--
Now he would, on the contrary, contend, that there
existed the strongest reason for in9niring into this
species of issue, unless it were maintained that a
coinage of such a description could be allowed to
piss without controul. The Right Hon. Gentleman
ha I said, that the effect of the country bank mea-
sure would be to throw the circulation into the hands
et Government. This he would distinctly deny, for
it, on the contrary, gave a valid security to the country
bank paper, which, for the purposes of immediate cir-
culation, gave it a preference to the Governmeot pa-
per, from its being free from the comparatively disad-
vantageous forms which were necessary in procuring
cash for the latter. He would here beg to disclaim
that e hich had been so often alluded to, of his having
ever entertained any idea of an issue of stock deben-
tures. He had no such intention, as he thought the
public securities were already issued to as great an
extent as was either necessary or desirable. He would
also deny that the benefit of the rise of price in the
feeds had fallen merely into the hands of the large
capitalist; how many small stock-holders were there
who had equally participated in this benefit?—(hear.)
The rise in the price had also diffused a considerable
capital throughout the country, and influenced its
general trade. As to the general character of the
country being at stake, all he would say was this,
that while 16,000,0001 of the Unfunded Debt had
within a short period been reduced, and the credit
of Lngland been for years unimpaired, and her re-
sources triumphing with this, as it was called, paper
issue, there could be little apprehension of her cha-
racten suffering from her system. She had taken a
memorable and active part in the liberation of the
Continent—she had subsidized all Europe with this
paper treasury, which the Right Hon. Gentleman
had se often declared Valueless, and redeemed within
the last three years 50,000,000/. of debt—while on
the opposite side, she had certainly created another
debt, bat which in comparison with her state at
the Peace of Amiens, left her with 15,000,0001. less
of unfunded debt. This vras a more favourable
financial state than could be sliewn by any other
country in Europe. America had been loudly talked
of, and he would only say that he respected his
Transatlantic Brethren, and hoped that the sin-
cerest and most cordial intercourse would continue
to subsist among them and the European States—
Rut the sort of relief the people of America got was
a reduction of internal taxation, the support of the
entry being provided for by their commercial
duties, which shelved at once that America had
thrown herself entirely on a peace establishment, and
relinquished any idea of holding to the Powers of
Europe a hostile front. In England 17 millions of
..es were relinquished since tke peace, besides the
..doption of other advantages. It was in vain for the
Right Hum Gentleman tos enforce the necessity of
payments in this manner. In the partial ar-
.gements of last year for a cash circulation two
rlllions and a half' of the sum coined had almost
itn-
t'i:diately disappeared. It was true that the course
of elchanges might be turned by cash payments, but
to the extent of the operation of the 30 mil-
lions loin. In acceding to the proposition
Right Hon.
e Gentleman. he saw at one side noofthit4
Ztordarj rs, while on the other he saw no possible
I( armee from the prolongation of the Restric-
t! )11 Act for one year imager—(A lasigh.)—He felt it,
Ce, •
dere. necessary to oppose the motion—(hear.)
Lord ALTHORP observed, that the principal ar-
;:dale,atwhe.reby the Right Honourable Gendemaa
ea o ureu to persuade the House to agree to the
a?:.her suspension of cash payments by the Bank,
ass. the danger of
tlea large exportation of gold by'
fy • • of the French loans; whereas, it was,
..ccg.vensent to make remittances by any other

commodities than gold ; andsthat this was the case
in the Austrian loan, had been proved in evidence
beford the House. The prinoiple of foreign loans
exercising such an influence on our internal concerns
was perfectly new; it was throwing the state of the
currency of the country altogether on the mercy of
foreigners--a principle to be acted on at all times,
whatever our own internal condition, whether adverse
or prosperous. He thought a Committee was neces-
sary, to examine if there existed a necessity for a con-
tinuation of the restriction, and if so, to guard
against its recurrence. The measure still contem-
plated by the Right Honourable Gentleman for the
regulation of private banks, paid a regard to capital
only, whereas the credit of such concerns was far
from depending altogether on their capital. The pru.
dence integrity, attention to business of the mana-
gers, no less deserved to be taken into the account.
Gold and silver formed the natural standard to regu-
late eae value of other commodities, as being least
liable to vary in their value ; but the Right Hon.
Gentleman had taken the price of Stocks as his stan-
dard. The Right Hon. Gentleman intended to make
it imperative on private Bankers to make a deposit
of stock or other securities, while the first principle
governing such concerns should be, that their whole
capital should be at their own disposal. The Right
Hon. Gentleman proposed to take half their capital,
and put it into his own coffers. Whether the state
of the country required such a violent interference
with private affairs, would form a proper subject of
inquiry for a Committee. The only objection made
by the Right Hon. Gentleman to the Committee was,
that he had been unable to come to any clear con-
clusion himself on such a complicated matter ; but
that would have been an argument against the con-
sideration of any great measure. On a question
where such novel principles of commerce had been
advanced by the Right Hon. Gentleman, he thought
it impossible the House should not agree to the ap-
pointment of a Committee.
Sir H. PARNELL said, it had been already re-
marked by the. Noble Lord (Althorp) that a great
part of the Austrian loan had been remitted in come
modities. To confirm this, he would observe, that
for two or three years immediately preceding the
time when that loan had been contracted for the ex-
ports amounted to but two or three millions, whereas
during the operation of the loan, they rose to ten, a
fact stewing that when a country was obliged to
make great remittances, exportation would naturally
follow. Ireland found it possible to retoit two or
three millions annually to her absentees, without
either specie or coin. What then could it be in—but
exportations of goods, which overthrew the Right
Hon. Gentleman s opinion, that remittances from a
country were necessarily attended with a disappear=
ance of the currency ? The Right Hon. Gentleman
had referred to the opinion of the Bank ; but in his
apprehension it shewed no arguing on principles,
and nothing but an attention to their own interests.
The first and principal objection to the plan of the
Right Honourable Gentleman was, that by adapting
it, we lost the opportunity of commencing a gradual
return to cash payments. Another great inconve-
nience resulting from it would be, that it would cause
a great additional issue of paper by the Bank of Eng-
' land, and by Country Banks. If this went on, the
same thing would happen as had happened already.
Gold would rise, the exchange would fall, and the
Chancellor of the Exchequer would again come down
to the House, and say it was impossible to return to
cash payments. It appeared to him that the plan
would go on from year to year, and was little likely
soon to terminate. It appeared to him, that so long
as a loan was necessary to the Chancellor of the Ex-
chequer, so long there would be no sincere desire on
the part of the Government that we should have a
resumption of cash payments—(Hear, hear!) He
accordingly came to this conclusion—that as loans
were rendered necessary by the excess of our expen-
diture over our income, it was our grand object to
bring down the former to the latter. He trusted a
more rigid inquiry on that subject would be institu-
ted than had yet taken place. Till that was done,
we should never be able to get out of the difficulties
lthat surrounded us, both with regard to, our currency,
and of various other descriptions.
Mr. C. GRANT said, that there was one great
practical question before the House to be decided on
its own grounds—namely, whether this was a proper
season to resume cash payments? The Right Ho-
nourable Gentleman had introduced other and im-
arntant or.es, but whether his views of them had
correct or not, it was better to discuss them se-
parately. The Right Honourable Gentleman had
gone so far at to say, that to continue the restriction
would be breaking faith with the country—a viola-
tion of the pledge publicly given: But how could
that be said ?—how far had a pledge been given?
Could it be for a moment supposed that the Legisla-
ture had bound itself to resume cash payments at a
specific time without any reference to circumstances?l
It had undoubtedly so far pledged itself, that it was
sincerely desirous to resume cash payments the mo-,
ment it could safely be done, but no further. Two
things might prevent a resumption of cash payments
—an inability on the part of the Bank, or, supposing
that not to exist, something in the situation of affairs
to render it inconvenient and impolitic. To remove
the former, Government have done every thing they
could, and the Bank were quite ready to pay their notes
in specie, whenever the Legislature might deem it pru-
dent to allow them—but the situation of the country
was such, that it was not in the power of Government
to recommend, or the Legislature to permit that, while'
the general aspect of things remained as at present.—
It was not at all necessary to prove that our present
situation was precisely parallel to that of 1797. The
question now came on its own merits. To return to
a metallic currency now, might most strongly rivet
in the minds of the ptople that prejudice which had
been long growing up in them. The sudden distress
which might possibly flow from it, might more deeply
impress on them the belief that they could altoge-
ther dispense with such a currency. The measure
would at any' time be attended with a considerable
pressure. How unwise then to choose that time,
when the circumstances were most unfavourable, the
difficultiek most formidable? The contraction of the
paper issue would be attended moreover with the
difficulties of the great operations on the Continent.
On the occasion of the Austrian loan of only four
millions, in the year 1796, Mr. Boyd said it was im-
possible to be effected without a great fall in the ex-
change. The question altogether was one least fit

for a Committee. -All they could give would be
opinions and conjectures onfUct, equally well known
to the House as to them, and on which it could just
as easily' come to any certain conclusion. He said
this from the various contending considerations that
must be brought into the cal- ,lation—the state of
immerce in foreign cm-- e exchanges—and
convulsions

the consequences of the political . all
through the Continent—(hear, hear.) He contended
that prices had influenced the currency, and not
that the currency had had an influence on prices.—
Of the Bullion Committee he must always speak
with the greatest respect; but he could not shut his
eyes to what had since been forced on him by facts—
that they had not attributed sufficient efficacy to the
effects of the-great agitations of Europe. If, then,
such men as the Members of that Committee had
fallen into error, could more be expected from ano-
ther, however constituted. They indeed had carried
their inquiries to a certain stage, but there they stop-
ped. They brought the readers of their Report to
the verge of an intmane barathrunt ; they had, in fact,
attempted to define what was in its nature indefina-
ble; the distinct effects of various, multiform causes
operating on a system, at a time when all the esta-
blishments of the world were in agitation. One cir-
cumstance (he believed not generally taken into ac-
count) might materially contribute to raise the price
of gold, namely, that Europe was undergoing the
same operation now, as England had undergone at
the commencement f the last century, that gold was
becoming the standard of value in place of silver.
Goinginto the Committee, probably without any
practical' results, would produce a great agitation in
the country, not to be counterbalanced by any slight
benefit it might eventually give rise to.
Mr. J. P. GRANT said, that the grounds proposed
by the Right Hon. Gentleman (the Chancellor of the
Exchequer) for continuing the Restriction on Cash
Payments, were of two descriptions : some so clear
to himself, that he did not think it worth his while
to explain them to the House—and others which he
professed he was unable to explain to himself. He
by no means assented to the position, that, because
the case was complicated and difficult, it was there-
fore unfit for the consideration of a Committee ; on
the contrary, its complexity and difficulty was the
very reason why it should be referred to one—(hear,
hear). He now understood that the operations of
other countries were to be converted into a general
principle, applicable to the state of our own currency,
as regularly exercising a material influence over it.
Before the House sanctioned the establishment of
such a principle, on the words of the Chancellor of
the Exchequer, it were well to have the matter fairly
and fully examined, and sifted to the bottom by a
Committee. He did not think that the real ground
of his measure was that assigned by the Right lion.
Gentleman—he thought the foreign loans had nothing
to do with the matter. The Right Hon. Gentleman
had stated that there was a mistake in the preamble
of his Bill, and that it was to be altered. He supposed
then, that words to the following effect were meant
to be introduced Whereas, the French Govern-
ment is about to contract a loan, or loans, in which
British Merchants will probably take a part—and
whereas, it is an established principle that such ope-
rations materially influence the price of specie," &c.
If the Right Honourable Gentleman would thus cor-
rect his mistake, and he supposed he would, he was
entirely mistaken; and if he could shew that the
Right Honourable Gentleman was. mistaken, he
would have shewed a ground for the appointment of
a Committee. He would admit, that the Bank was
now unable to resume its payments, 'but this was
another reason to accede to the Committee. Not one
of the alleged reasons for the continuation of the re-
striction, whether the foreign operations, or the state
of our coin, or any other, but was a fit subject of
consideration for it. Gentlemen wished to have it
thought that the Austrian loan was the cause of the
suspension of cash payments in the year 1797. But
on this he would observe—lit, That that loan had
nothing whatever to do with the price of. bullion ;
2d, That the late Mr. Pitt had said, the Bank were
wrong in their opinion ; 3d, That the Prussian loan
in 1795, produced no such effect as they apprehen-
ded. The evidence given by Mr. Boyd, the agent
for managing and remitting the Austrian loan, proved
that the whole of the money remitted passed through
his hands—that a very great proportion of it consisted
of bills of exchange and toreign bullion—that the cash
remittances were principallyl,o43,ooo Spanish dollars,
and 150,000 French louis-d'ors, of which the greatest
part was purchased at the Bank of England.—
That of the loan in 1796, the principal was also re-
mitted in bills of exchange. and none in coin or bul-
lion: • The House would find, on referring to his evi-
dence, that during the greater part of the time while
these operations were going on, no man could have
remitted gold to lfamburgh without loss—that gold
could have been imported with profit. Yet we were
told that foreign loans caused the suspension of cash-
payments, lest all our specie should be drained away
to the Continent. The lion. Member quoted. Mr.
Locke, to sheer that gold and silver should• be consi-
dered in reference to the causes of their rise or depres-
sion in value, like any other commodities ;—that a
scarcity would produce an increase in price, and a
glut a fall. The fact was, that the restriction had not
arisen from any foreign transactions, but the advances
to the Government. The correspondence between the
Bank and the Government, at the time they were
getting into difficulties, was full of applications, en-
treaties, and remonstrances on the part of the Bank
for the repayment of their advances—(hear, hear.)—
The result of this correspondence was, that the dan-
ger, such as it was, arose altogether from an excess
of issues on the part of the Bank, in their desire to
accommodate the Government ; and that the remedy,
according to the evidence of Mr. Giles before the
Lords Committees, was to be found in the repayment
to the Bank of these advances. What then, he asked,
was the difference between the state of affairs in 1797,
and the present moment, that could induce the
House to refuse a Committee of Inquiry now, when
it was considered so essentially necessary at the for-
mer period? An Hon. Gentleman (Mr. C. Grant)
had stated one reason for the increased price of gold,
nirnely, that it had become the standard of value
all over the Continent. The force of this argument
he could not pretend to understand, but he could
easily conceivehow the price of gold might be af-
fected in this country, by the circumstance of there
being in circulation at the same moment a gold
coinage at its full value, and, a silver coinage much

below its actual riitse, the result of which was dis-
cernible in the disproporgbn between the prices of
gold and silver-in the market. Gold had now risen
to 41. 2s. while silver had risen to ss. .sd. But wi.de
gold was estimated at the Mint at Si. I7s. tO6he
could see no reason why persons would pay in•gold,
when they might make several payments in giver at
a cheaper rate. While these circumstances operated,
he could entertain no hopes of hating the Bank re-
sume its cash payments, it being. in fact, as impos-
sible for the Bank to maintain the gold circulatiod of
the country, as to build a reservoir with a hole in it.
Every sovereign coined would vanish as speedily as
did the sum of 2,500,0001. lately issued to the coun-
try. This, however, was no reason for continuing
the restriction on cash payments without a previous
inquiry; and, indeed, from the specimens of financial
perspicuity and decision lately evinced by the Chan-
cellor of the Exchequer, he did not feel himself very
ready to pin his faith upon the -Right Honourable
Gentleman's asserions.

Mr. HUSKISSON rose amidst cries of "Question r
which rendered the commencing words of the Right
Hon. Gentleman. somewhat inaudible. Proceeding,
he referred to the Report of the Bullion Committee.
which, whatever reproach and ridicule might attach
to the assertion, he conld not avoid considering as
an able, luminous, and satisfactory exposition of the
interesting subject of which it treated. It bad been"
prepared by a Gentleman (Mr. Horner) whose en-
larged mind was well calculated to investigate any
subject with precision, but which had been applied
to this question with peculiar success. He could not
'conclude this brief observation of that distinguished
individual, witltotit expressing his regret that he were
not then present to assist their deliberations with the
force of his reasoning, and the accuracy of his judg-
ment—( Loud cheering). The Right Ilon. Gentleman
then adverted to the state of the question immediately
before them, and observed, that he had that night
went down to the House, in the full conviction that

no dissent could have been expressed to the princi-
ple that an increase of a paper currency must have
the effect of increasing the prices of all commodi-
ties, including, of course, gold and silver, and bills
of exchange ; for the real definition of a bill of ex-
change was " an assi"nmentb to one country, of so
much of the bullion of another, as was represented by
that bill:* The reverse had, however, been asserted.--
He here read some extracts from a book lately pub-
lished, which, to his mind, was written on extremely
erroneous principles. The principal argument ad-
vanced in support of the Bank Restriction was, that,
if the Bank were compelled to,resume cash payments,
the issues must be so very much contracted as to be
attended with consequences -very injurious to the
country, and that the same confusion must be ex-
pected from it as had been witnessed in 1815 and
1816. 'This, indeed, was the only argument that
could be urged in favonr of the measure-z--(heer.)--
The issues of the Bank had, however, in his mind, a
very considerable-influence upon the rate of foreign
exchanges. These must become unfavourable to a
country possessing only a paper currency, not trans-
ferable at will into cash, should it increase beyond a
fair proportion, with the currencies of other countries.
In 1816, when the currency of the country was con-
siderably diminished, the foreign exchanges were
forced to an unnatural state in favour of Great Bri-
taint and in his mind that was a-favourable time at
which the Bank of England might have resumed cash
payments—(Hecir, hear, hear, front the Opposition.)
if prepared in other respects. He was also of opi-
nion, that had the Bank then resumed cash payments,
the amount of gold already issued, and which.has so
suddenly disappeared, would have been sufficient to
have enabled the Bank to maintain the.eash circula-
tion of the country—(hear, Near, froth the Opposition.)
The state of affairs was, however, widely different at
the present period ; and he would ask the House if
they were prepared tocompel the tosumption of cash
payments at the moment when the Gevernment of
1 France were about to negocinte a loan Of 30 millions
sterling, and when the Goiferoment of Prussia had
'just concluded one in this .evirntry,- of which.* very
large proportion had been transmitted in specie? It
had been asked, what difference existed between a
loan to a foreign Government, and the effects of the
usual desire displayed by many persons of seeking a
larger interest for their money in foreign countries ?
'To his mind there was a great difference, becaust it
appeared from experience, and from the very necessity
of contracting the loans in this country, that the fo-
reign Governments had not succeeded in induting
persons, in this country tb transfer their capital into
the foreign funds, and that without this supply of
British capital, those Governments were wholly inca-
pable of performing any great financial operation.—
It had been stated that Mr. Boyd had given in evi-
dence befora,the Committee, that he had transmitted
bat a very inconsiderable part of the Austrian loan
in specie ; and it was thence argued that a foreign
loan was not calculated to produce any great effect
upon the price of bullion. But of the actual amount
transmitted in money in any one loan it would be
difficult to speak with accuracy. It was not correct
that loans were generally transmitted in merchandise.
The fact seas, they were more usually transmitted in
bills of exchange—(/icar, hear, from the Opposition)
which lie was ready to admit might have been pur-
chased by merchandize—(Hear, hear)—but should
the result of this commercial operation leave against
the country a balance, it must be eventually paid in
eold and silver. He hen adverted to the unfavour-
able effect produced on the foreign exchanges, even
by the Austrian loan in 1797, when the issues of the
Bank of England had been very much contracted:
The distress which occurred at that period had been
attributed by Mr. Henr7 Thornton, in his evidence
before the Lords Committees, to the great diminu-
tifm of the paper issues. of the Bank ; and even Mr.
Giles, whose. authority had been so triumphantly
stated on the oppcsite side, had given his opinion,
that were it not for the restriction the Bank would
stilffurther contract the circulation. With respect
to the immediate resumption of cash payments, the
measure seemed to him incompatible with the exist-
ing state of affairs, nor did he think that the House
could in any degree interfere with the internal regu-
lations of the Bank fur attaining that object.--
He feared that in any attempt they could make, they
were placed very much in the hands of the Bank of
England_( Loud cries of Hear, hear.) He meant
that the House could du nothing more than declare
the time for resuming cash payments, but must leave
the means with the Bank itself. He thought that all

I.itr. a ierney, - 1
Now he would, or
existed the stronJ
species of issue,
coinage of such ;
pass without conti
ha I said, that the
sure would be to
ot Government.
it, on the contrary,
bank paper, whir
culation, gave it
per, from its bein
rantageous form
cash for the lute
that nhich had b
ever entertained
tures. He had r
public securities
extent as was eitl
also deny that th
leads had faller
capitalist; how
who had equally
The rise in the p
capital through(
general trade. J
country being al
that while 16,00
within a short pe
ot England been
sources triumphi
issue, there coule
niter. suffering I
memorable and
• Continent—she
• paper treasury,
▪ had so often dec
•
the last three ye
the opposite sidt
debt, bat whicl
the Peace of Ai
of unfunded de
a financial state
country in Eur(
t. of, and he va.
a Transatlantic
cereft and moi
to subsist amoi
But the sort of
a reduction of
°' 7suntry being
duties, which
thrown herself
relinquished an
Europe a hosti
' were reli
• •loption of oth
Right Hon. G
re
rail( payments
t• _gements of
illiOnS ar.e. a
),i2diately &sal!
rix of exchanges ni
Itx •
v•cthi:•g to the
0 Hers loan. In
Right Hon. Ge
but datgers, w
Ilconvenience I
el :ion Act for on•
1-erefore• neces
c Lord ALTH
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tss"
.7deavoured to
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14: n.,c; ct,:xvcx
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