Star.
London, England, 1826-02-14 00:00:00

Ocularly as he had the honotr. Ing by
the acquiescence of the late Honourable Member for
Pot tarlington (Mr. Ricardo). As to the policy of those
prificiples, ycleped free trade principles, he (Alderman
Heygate), begged to remark, that they began at the
wrong end. They should have given us the Reces-
series of life cheap before they attempted the decisive
changes in relation to the commerce of the country they
did ;—the repeat of the Corn Laws would have given
us these necessaries at a. low price ; and consequently
as free trade was the cant of the day—the repeal
of the existing restriction on the importation of
foreign corn should have been adopted. He agreed
with what fell from the Right Honourable Gentle-
man opposite (the Chancellor of the Exchequer) in
relation to the Bank of England monopoly, the establish-
ment of Joint Sock Coinpany Banks, and the demand•
ing of satisfactory security from country bankers,
,though be doubted, if the expected results would follow
the intended changes of the country bank system. He
alluded to the understanding that existed between the
Bank of England and the Government; the former, in
the first place, lent them money ; the latter gave them a
charter of monopoly; and afterwards advanced the
Bank Excequer Bills to the amount of 6,000,0001. for
which, no doubt, the Government must get a proper in-
terest. He again reprobated the free trade system,though
he begged leave to be understood as an admirer of the
policy. The policy we had abandoned was a safe one,and
brought to the test of experience. That on which we
were now entering was uncertain, and left us, at the
commencement of our career in it, in no very enviable
state of prosperity. He hoped, in conclusion, that the
Right Honourable Secretary fir Foreign Affairs, whose
high talents the House and the country acknowledged,
sad admired, and Mee heart be (Alderman Ifrygete) knew to be'
as Nadas Ma talents were great, mid direct his talents and Ms
Moderns towards replacing as in thas course of policy in which ws
-bad Mime thriven,-and the adoption of which was required by
eke best interests et the country.

Mr. Secretary PEEL did not intend to deny that
commercial embarassments existed, and to a very con-
siderable extent : to none were they a subject of deeper
regret than to himself. If the House should be induced
to disfavour the measures of his Right Honourable
Friend the Chancellor of the Exchequer' they would be
holding them responsible for events which they did not
cause. So deeply was be impressed with a sense of
their necessity, that he would exhort the House to pay
diligent and immediate attention to the footing on
which the currency now stood. Wis it prudent to let
it continue in its
,present state, when they looked to the
effects of the system of private banking for the last
thirty years. He was astonished that the Honourable
Gentleman who last spoke miuld construe the language
4. his (Mr. Peers) Noble Friend, at the head of the
Treasury. and of his Right Honourable Friend the
Chancellor of the Extheqaer, as directed against indi-
viduals. When they attributed public disasters to rash
pecuniary transactions, fostered and encouraged by the
existing system of many country banks, he had no
hesitation in advocating those sentiments. lf, indeed)
insteAd of such language, they had employed ciao terms
used by the Honourable Gentleman himself, such as
abominable ono— --•erable plans—it might have

been highly objectionable. The Hon. Gentleman seemed
to impute to Ministers an intention to blacken the cha-
racters of individual country Bankers. He (Mr.Yeel) was
willing to give them full credit for honourable feeling ;
but yet he must reserve leave to reprobate the system.
There were at this day no less-than 800 country bankers.
lu the year 1793, it was matter of astonishment to Mr.
Macpherson that there had then been so large a num-
ber as 288 bankers issuing paper, which was the cir-
culating medium of the country, by which the poor
were paid for their labour. Against that system he
would deduce the most powerful arguments from the
facts disclosed by those who were its most strenuous
advocate. The • Hon. Gentleman, who last spoke de-
precated the charge against the over-issues of private
bankers, on this ground, that no private banker was
aware f the public injuiy to which he might contribute
is the course of his accommodations to the individuals

with whom he dealt, inasmuch as he could not possibly
know what excess had already been committed by other
bankers in their issues. And could any stronger reason
be advanced against the system than this very one,
which was urged in its support ?—Again, it• was stated
by the Hon. Member for Staffordshire, that bank notes
had a nausea tendency to increase in proportion to the
rise of prices. Was not this another very strong
argument against the principle of the system ?—And
might not the Honourable Gentleman with great truth
have added, that as prices fell, there was a correspond-
ent tendency to contract the issue of bank notes?—
Their effect was to stimulate in excitement, and to sink
with depression : thus reversing the beautiful principle
in mechanics, wt.ereby the contraction of one part is
compensated by the expansion of another. The argu-
ments iu favour of the sy stem, availing anything, should
go to its indefinite extension even after the expiration of
ten years. Yet how melancholy would be the situation
'of a poor labourer who had accumulated a little sum
by his toil, on pre►enting at a Savings Bank the one or
two pound note of a bank which bad failed. It was not
designed wholly to impute to bank issues the specula-
tions in which men engaged ; it was only meant that
such issues had a tendency to excite speculation. It
was easy enough to attack the measures proposed by
his Hon. Friend the Chancellor of the Exchequer, and
to say that it was no remedy for the evils which it was
designed to meet. But the fact was, it did not profess
to be a remedy.. The Hon. Member for Taunton had
said, that the House was on fire, and that they were
bound is provide for the safety of those who were
trembling in the garrets. Yet the only ladder—the
only measure of relief which he bad proposed was liable
to the same objection as tbat,which he said went only skin
deep. His proposal was to make silver the legal standard.
It was certainly deserving of grave consideration ; but
before its adoption, it would be necessary that the mea-
sure should be well reviewed, in order to prevent fluctu-
ations, that men who bad contracted for gold might be
enabled to pay in silver. By the restoration of a gold
currency we approached nearer to a conformity with
the system of our ancestors. The effects of the modern
system were obvious enough in the failures of Country
Banks which occurred in later years. In 1810 there
were 26 failures--

I
In 1411 . . . 4 In 1614 . . • 19 •
1612 . . . 17. 161 J . • • -14
.11115 • . . • IS 1414 . • • 57
,sad 1n OW lest crisis there were 76 failures. 114 awn

bet of COmanissions of Bank:* *Will Wit Weed
emu act identicil with the nitinber of Wham. In
MS &ere were but Cotifinindons, though there had
been ND failures ; and they ought petliaps to itinploy
the *tie proportion in estidfating the recent failures,
multiplying the given number. Accordi(tgto this view
of the case, could any system be worse? Now let Hon.
limen contemplate the effects of the system pur-
sued in Scotland. In 1819, when Mr. Gilchrist, a
Scotch Banker, was examined before a Committee of
the House, when asked how many failures he knew to
have occurred among the Scotch Bankers ? his reply
was, that within his own memory only one failure oc.
curred in Scotland, and that the failing Bank had paid
immediately a dividend of 14s. in the pound, and
subsequently the whole of their debts, a strong pre-
sumptive proof this that there was something worthy of
.imitation in the Scotch system, and something defec-
tive in ours. The most distressing consideration con.
tSected with the latter was, that all misfortunes were
sure to be visited upon the lower classes, in consequence
of the succession of failures. Those who were losers of
large sums might from their easy circumstances be
enabled to wait a distant time for a dividend; but the
bolder of a 1 or 2 pound note had perhaps Lis whole pro.
petty confined to that.very sus), and suck we're the
parties who were at once involved in the severest neces-
sity, and after all received the most inadequate com-
pensation. He would now advert to the adequacy of the
remedy proposed, and finally, he would notice the ob-
jection nude against the time of its introduction. Some
Gentipiavn were of opinion that thtte would be no Joint
StocE Banks formed in consequence of the permission
of an Act of Parliament ; but to that opinion he could not
agree. He was very sure that such a plats could not
fail to be brought into action by those Gentleman who
were desirous of establishing a better system of things
in their own districts, and he felt that they would
be actuated more by a sense of the public good
which must flow from such a measure, than by any
selfish regard to their private interests. One obstacle
alone was opposed to so desirable an object, namely,
the right of granting a Charter to such Companies,
and he hoped that the Bank of England- would con-
sider the little advantage which it gained by with-
holding the concession, and the great benefit which such
concession would confer upon the country at large.
As to the objection that in the marjority of partner•
ships at present, the number of partners did not
amount to six, it went for nothing. So small a
number as six implied personal acquaintance and con-
fidence between the Members, but that was not ne-
cesssary in the case of a. Chartered Company. In
Scotland one Company consisted of a hundred Mem-
bers, and another of 75, though neither had charters.—
There were but SO banks in all Scotland, though we
had 800 here. In Ireland two banks had been formed
since the Permissive Act of last Session. With respect
to withdrawing the small notes, there would be no great
difficulty in procuring a sufficiency of gold to supply
the amount of them in circulation. THe average amount
of small notes in circulation did not probably exceed six
millions.. But he was willing to take 7,000,000 as a
maximum ; and even in that case he could not see the
impossibility to the country of supplying such a sum in
gold. S nce 1819, twenty-five millions of sovereigns
had been coined at the Mint. Allowing for- seven or
eight millions exported in the interval, there remained
seventeen millions now in the kingdom. The prohibi-
tion of country notes would call forth the gold, which
was now hoarded in the coffers of Bankorv, partly as
a resource to meet a demand of payment, and partly
that they might see their own notes in circulation.—
The whole, he thought, might be amply made up in
the course of three years. The Honourable Gentleman
who had spoken first seemed to think that the same
right existed in the country banks to continue their
circulation as in the Bank of England ; but he should
have recollected that the private banks had no Charter,
while the Bank of England bad one for which it had
payed to Government. Those who recommended to
postpone the question were advocates for uncertainty.
Every argument, said the Right Hon. Gentlemaso,
which I have heard urged in the course of the debate
by the worth Alderaian who spoke last, and by the,
other Honourable Gentlemen who have preceded him,
has strengthened the conviction of my mind,- that the
present moment is expressly the moment for carrying
the measure into effect. I am quite satisfied that the
question is now ripe; that the quer ion is now or never
—(Hear)—but if the House should come to a resolu-
tion not to carry the measure into effect at present, let
it be abandoned ; but if it be abandoned, let it be
distinctly understood, that it is abandoned for an in-
definite time. Honourable Gentlemen have said, that
in time of prosperity, whet the effects of the late panic
have subsided, the measure might be carried into effect
with less danger than it could at present. To that as-
sertion I would reply, that I could conceive no period
at which it would be more difficult to carry such a
measure than a period of general prosperity; and whets
Honourable Gentlemen connected with country banks
assert the contrary, I beg to refer them to what passed
in the year 1818, when a proposition was made on the
part of Government, that the country bankers should
give a security for the amount of their issues. I beg to
recal the attention of Hon. Gentlemen to the exertions
made at that time in opposition to the measures pro-
posed by Government, exertions so great, that the
Government was obliged to abandon—l will admit, to
abandon—the measure which had been brought forward.
I refer Honourable Gentlemen to that period as afford-
ing some proof that a time of prosperity was not the
only time in which explicit acquiescence in such a mu.
sure could be expected. If it be true, as the worthy
Alderman has stated, that a sudden and precipitate
reduction, to the amount of six millions, has taken
place in the circulation of country bank notes, and that
gold is flowing ieto the country—then I will say let not
such an opportunity pass—let not the opportunity pass
when the measure can be effected with less immediate
pressure than it could be in a time of prosperity with
the country bankers. It appears to me that the time
has arrived when we can carry the measure into effect
—that we are upon the brink of the river—that the
ford is passable, and that if we permit this opportunity
of taking our passage to pass by, we shall imitate the
folly of the Rustic, who waited on the bank, expecting
the stream would pass away—

" !action expectet daat Meant menu; at illa
LaMar et labstar la mos valuta, smut."

Nsy, our *nation will be one of wore dankly, if we sear this
opportunity to pow away. If we now hesitate aid postpone the
aseasnre, we shall And on our return,

A. ymifell
Qaenssoper Notas duere rirss."
The pose. is now pracdcabk, and I for one am ready to make it
but it we ow hesitate. we BOK sbuidon the measure u cue at•:
tarty kopeks a and impracticable at a future period. (The Right
' Hut. Gentleman sat down amid load and sentinued cheers).

Alderman HRYGATS etplated.
Mr. M. ATTWOOD said, whatevet good of al had
been produced by the paper circulation was to be as,
cribed to the increased circulation of the Bank of Snp,a
land. All those enterprifes and nvettradings which
were the subject of the Right Hon. Gentleman's obser.
rations, were to bedscribed to the measures of Goverivt
meat. The paper circulation was forced by Mr. Peers
Bill, and from that arose all the ealarnities which fat'
lowed. The Session of 1822 commenced with Ministv
rial projects for increasing the Sank circulation. It wits
first proposed to increase the Bank circulation by bor-
rowing money ; it was then proposed to lend mosey for
the purpose of increasing the Bank circulation ; and out
of all theie projects arose the one for raising Money upon
a dead weight, and borrowing principal to pay interns.:
There were 21 millions of Rank notes in circulation, an
it was as clear as that the sun would rise to-mOrrosr
that the price of gold woull rise in proportion to the
quantity of notes out. The change in circulation pro:
duced by the measures of Government effectually ahemd
the value of property. It was worth while to see how
the price of grain followed that alteration. In 1821,
the average price of grain was 435. a quarer, aad he
should be glad to know if that wa, not as h;g11 a prize
as could ever be obtained for it with a metallic cur-
rency. As to the change of seasons in a tountry tike
this, the argument deduced from that was perfectly nu-
gatory. The question was not as to quantity, but as to
pr;ce. When commodities were at a high price gold
disappeared, and was at a high price until the value of
commodities was reduced. The Bank of England was
the heart and foundation of the money system of this
country. When commodities were high, the demand
was greater, ant when the price of commodities was
reduced by the measures of Government, the demand
decreased. The precious metals, like other things, were
subject to this standard. Out of the high prices other
things, besides speculations, arose. Rents had atiseo
from high prices. The population of the country, too,
was changed from a population he might say of rebels,
into one of the most contented, tranquil, and prospe-
rous populations is the world —a population full of con.
tent and prosperity. The Chancellor 'of the Exche-
quer had observed upon the favourable state of the Re-
venue; but was not the favourable state of the Revenue
founded upon a paper circulition? The Government
should be cautious how it proceeded. Ministers should
recollect what had past, and if these recollections did
not impart caution nothing cook!. When the notes come to be
withdrawn the money engagements of individuals were necessarily
cut down to that on which they were founded. By some, means.
either by slow reduction or by oudden revolution, all engagements
were reduced to the level of notes of the Bank Of England. But
the Bank could issue largely with Mr. Peel's Bill pressing on it.—
The Bank paper was forced back by the measures of Government,
and distress was the necessary consequence.
Mr. HUDSON GURNEY said, in a very indistinct
tone of voice, that should he not be anticipated, it was
his intention to move an amendment to the resolution
of the Right Hon. the Chancellor of the Exchequer.—
The amendment would entirely leave out the words
"or notes of the Bank of England." This would keep
the notes of the Bank of England in circulation; an
object of very great importance—because he was wis-
fied one of the first effects of the measure would be, the
substituting country bank notes, as the circulating me.
dium, instead of small Bank of England paper. He
attributed the foundation of all the errors and calami.
ties lately experienced in the monied system to the
conduct of the Bullion Committee. In consequence of
a Bight Hon. Gentleman who interested himself much on that
occasion, bringing in the Bill of 1510, foutided w eras Bevan of a
Committee of the Howe, a series of Inconveniences arose, which
ended in the general distress of 1821. He was convinced that
under what were termed gold prices generally, this country could
not hold up Its head in competition with others.
Mr. Secretary CANNING—Sir, before I proceed to
discuss the very important and interesting subject now
under the consideration of the H mse, I beg leave to set
myself right with one class of Gentlemen who have
been frequently alluded to in the course of the debate—
the country Bankers—and to say, that whatever I may
offer in disparagement of the preeent system of our cur-
rency, and whatever opinion I may express as to.the
ne-
cessity of opirating on that currency a speedy and an ef-
fectual reform, I wish .t to be understood, that it is not my
intention in the smallest-degree to impute blame, to in-
sinuate suspicion, or in any way to treat with the slightest
disrespect, that valuable body of men so often alluded
to, as the administrators of our currency, such as it now
stands. I believe the country bankers to have rendered
great services to the nwien, by animating its industry,
and providing for the remuneration of its labour ; and
if in any instance they have done amiss, I am satisfied
their error has resulted from the nature of the system
itself, and not from any abuse of the powers which,
under it, have necessarily been lodged in their bands.
I am desirous of stating this mist distinctly at the out-
set; as one cannot always le sure, that, in the ardour
Of debate, expressions will not escape which may seem
to go front the matter to the person. When I
speak of the Country Bankers of Ragland, I speak
of them as I have often had occasion to speak of the
Directors of the Bank of England, as being most
respectable in themselves; but respectable as they are,
in my judgment it is not fit that they should exercise
the prerogative of the Crown; and feeling thus, I
throw no slight no blame upon them, when I
propose to supply correctives to that system, which,
up to this time, it has been their duty to carry into effect.
With respect to the fitness of the time chosen to effect
this reform, I think it right to say, that I consider this
the period when the discussion may be entered upon,
carried to a decision, and brought to a practical con-
clusion, with less isiconvenience than at any other. I
say this, because the fair presumption is, that the coun-
try banks now existing are proved to stand on a more
solid foundation than ever was theirs before. They
have withstood the storm, which threw weaker fabrics
to the earth, and having weathered that, they
can have nothing to fear from any new panic,
which the existing alarm, extravagant as it is,
may bring. My opinion is, that this measure is
necessary for the regulation of our currency.
1 felt anxious to clear the ground of the invidious im-
putations just mentioned, and I now proceed to treat
the question with all frankness and sincerity. Toe
Hon. Gentleman who spoke from the bench opposite
divided the subject most accurately into two parts, and
doing so, his speech furnished the best answer that
could possibly be made to all the objections urged against
the plan of my Right Hon.Friend,by the several speakers
who had preceded the Honourable Gentleman. It has
been said of it that it is wholly inefficient, that it is mete
milk and water, and then it is treated as a most formid-
able source of evil, and calculated to bring a greater
pressure on the country than it can by any means sostairl
Both these objections to the plan of my Rt. Hon. Friend
cannot her true, but it is very possible for both to be
wholly unfounded, and the Hon. Gentleman has :hewn
that this may be the case. He ha invalidated the first

= entered into a icular esplanstion of the circuits- bet 'o
no stances anterior consequent op,thoas periods of db. wore.
ms. tress ; which es idea molt to 'beer, that the distress )1,0
7E
be was not casing to: be causes ilVailbed tliy his Majesty's; beett
ng Ministers for chewers; revultiOt. -Hoplanted Minuted the sl
he with not paying attention to hif(Alderassin Heygates) *stifi
tv, warning as to the evil consequences of their policy, par. of thi
bar ticul.rly as he had the honour of being sanctioned by Gen!