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

TUESDAY, FEBRUARY 14, 1526.

Mr. MA BEELEY said, he was anxious to introduce a dis-
oussion as to the expediency of issuing Exchequer Bills; and as to
their amount, he also wished to see the connexion between the
Bank of England and the Country distinctly traced, as well as their
operations relative to the Funded and Unfunded Debt. He gave
this notice in ordtr that the Chat.cellor of the Exchequer might be
prepared next Wednesday to name a day for the discus•iun. in
his own opinion, the second Committee of Ways and Means would
afford a favourable occasion for the purpose.
The CH A NCF.I.LOIt of the EXCHEQU,ER gave notice,
that on Wednesday next ho would move that the House resolve
itself into a Committee of Ways and Means.

ADJOURNED DEBATE ON THE BANK AND CURRENCY
ACTS.

The CHANCELLOR of the EXCHEQUER moved the Order
of the Day for a Committee of the whole House on the Bank
Charter and Promhanty Note Acts.
Sir. J. %1110T1'ESLEY opposed the motion. He
deprecated the proposed measures, and called upon all,
who had heard the statement of the Right Hon. Gen-
tleman, and who agreed with him in thinking the views
it contained erroneous, and the remedies it suggestei
not likely to mitigate, but rather to aggravate, the
evils, to unite with hire in a determ;ned resistance
to their further progress. He most beg the indulgence
of -the House whilst he detailed the grounds on which
his opposition was founded, and he was confident that
ulion this occasion that indulgence would be extended
to him. He claimed that degree of, indulgence which
the Muse was always ready to bestow upon those who
undertook to advocate the interests of large classes of
men, upon those especially who undertook the defence
of what was more valuable than any other interest, the
character of such classes for honour and integrity. For
it could not be denied that the character of the Country
Bankers Was deeply. implicated in the charges brought
againt them. It was he thought a question on which
very different opinions might be entertained whether it
was wise and prudent conduct on the part of Admiois-
tration to bring the subject of the existing distresses
specifically and formally before the House. This was
not likely to produce any good effect, and might in-
crease, and lie believed had in fact increased the evil.
Ministers would say, no doubt, that the state of affairs
was such that others would have forced it upon the
attention of Parliament, if they had abstained from
doing so. But he was of opinion that they would have
done wisely if they had merely adverted to it col-
laterally, to state that it was best to leave firings to
themselves, expressing their e3nficlence that the energy
and spirit of the country would be sufficient.to bring
every thing round. If they had done this ,he ,be-
Hewed that the distress would more speedily have
passed away.' Any notice of the subject by un-
official persons would have been comparatively of no
consequence. The. mischief of increased agitation
and alarm which the country was now suffering, were
to be imputed entirely to the conduct of Min'sters.
The Honourable Gentleman here commented -with
great severity upon the letter of the First Lord of the
Treasury 'and the Chancellor of the Exchequer. Ao the
Book Directors.' He complained of the general and
swasOag accusation it conveyed against 'Country.
tauter., or Aaysninticled and abetted the era" .sue
tions into which the wbOle kingdom bad rushed. 'Freon
this unjust charge he would vindicate tbem.. There
was no class of men who took more pains to prevent
improvident speculations. It was their pla;n interest,:
and they considered it their first duty, to make-every
possible inquiry as to the conduct of their customers
and the manner in which they carried on th it affairs.
If they discovered that any man was entering upon'
wild speculations, they admonished and recalled him
to the path of regular and legitimate trade; or if be
were too obstinate to be recalled, they, from that time,
withheld whatever assistance wad ac-Ammodation he
might have been in the habit of receiving., The accu-
sation he would condemn as most cruel, partial, and
unjust. The One and two pound notes issued by
Country Bankers forsooth to be charged as the causes,
of the speculations, when it was well known that the
first appearance of those mad speculations was at Man-
chester and Liverpool, and their second at the Stock
Exchange in London; two parts of the Country, and,
the only two parts where no such thing as a one or
two pound note was to be seen. It would have
been a great deal more correct it Government bad
taken the blame upon itself. At the period of
the South Sea scheme, a most wholesome Act of
Parliament had been passed to prevent the recurrence
of similar bubbles. The virtue of this Acf had been
greatly impaired, however, by a decision of Lord Ellen-
borough, on an action brought against a Joint Stock
Company, the proprietors of some steam mills. The
question had last year been again mooted in the Court
of Chancery, when the opinion of Lord Eldon did not
appear to coincide with that pronounced by Lord El-
lenborough. The law -was brought into a state of great
uncertainty by those conflicting opinions. Was it not
then the duty of Ministers to get a declaratory act
passed, when the wilde:t and most absurd schemes
were daily brought under the notice of the House ? So
far from doing this, they did just enough to prevent any
body else from doing it. The Attorney General brought
in a Bill which w.as suffered tee lay neglected upon the
table during the whole Sessioii. Was he not then justi-
fied in the assertion that Goveirnmeht had been more to
blame than the Country Bankers? The next subject
upon which he would touch was that of the Bank ("bar-
ter, and here again was' an illustration of his opinion
that the Country Bankers were ill-used. Uron what
security does the- Bank of England hold its charter?—
Upon the faith of Parliament. Upon what does the
right of the Country Bankers to issue one and two
pound notes depend ?—Upon the faith of Parliament.
What gives thellank a right to hold its charter till 1898?
The falai of Parliament. What has guaranteed to country
bankers the privilege of issuing these small notes till
1833? The faith of Parliament. Why should the
faith of Parliament be broken in one case more than in
the other ? You get them into the scrape and then all
or a sudden you compel them to draw in their notes.
The three years' notice is merely nominal. If this area-
sure takes effect, they feet that they must as speedily as
possible draw in the whole of this part of tqeir issues.
He suppose d it would be contended that their privilege
had been abused by tke excessive issues; but he would
ask, had the Bank of England never fallen intofxcess?
Who was it that reduced the value of the Bank note so
low that a vino% b:caunt 'vrotth tvraorseven shillings?

Could that conduct of the B ink haVe been conti,reied
as a forfeiture of their charter. The fact of the country
circulation having doubled between the years 1',22
and 1825 is a fact ea.ily to be eiplained. Commo-
dities had doubled in price.- The bins of exchange
Which the bankers hid to discount for their cus-
tomers were . consequently of a double amount.—
;The amount of notes in circulation would be found to
have coincided accurately with the rises in prices. In
1825 corn and cattle were twice as high as in 1822.
In the latter quarter of 1825, when the pressure in the
money market was indicated by a fall in Exchequer
Bills, the amount of country bank notes was diminished.
The distress of the poor, produced by the
.fAilore ot
Count!), Banks, was a circumstance t hick none but the
lowest of mankind could disregard, but it must be re-
collecteJ, that no poor man need keep a hank note in
his possess'on for twenty-four hours. If he wished to
save monei(, and had it to save, there were Savings
Banks in every part of the country which would* pro-
tect him against every danger. . For the protection of
the poor everything ought to ire done; but negligence
Or carelessness couli not be protected—. The ciLculation.
of the whole country, except L mdon and Lancashire,
con.isted of one and two pound notes, and great diffi-
culty would be experienced if they were withdrawn.—
He. did not say that the country could not go on Without
them, hut he deemed it impossible that business to the
same extent could be cats ied on. Whatever be their
amount, an equal amount must be rendered useless—
which is now employed to set our manufactures in mo-
tion. It was contended that the establishment of Joint
Stock Banks would put banking upon a better footing.
did not believe a word of it. Perhaps in Lan-
cashire, and in Yorkshire, you may have great Banks
established—you may have great Banking Companies
formed, but he did not believe that they would
generally be established in the other manufacturing
.districts. as they could not have chatters, for the
Bank of England very wisely. as he thought, objected to charters
luring granted to any of the new establishments. The combination
of thirty, forty, or fifty adventurers indeed, in a John Stock Bank,
was not an improbable event; how far this must aggravate the
evil it was calf to foresee. 'The Provincial Banks had been the
aseani of stimulating the industry of the country ; they formed and
established themselves precisely in the situations Where they were
most required. With regard to the allusion to the present charac-
ter of Country Bankers, contained in the letter of Ministers, he;
ese,sld not condescend to reply to it. The highest testimony to their
&meter was to be found iu the prompt, unsolicited, and general
digiaratioes of ctinfidence and esteem made in favour of so many
iittliem in the towns and neighbourhoods where they were estab-
fished. He would again, in conclusion, call upon those Moo.
Gentlemen for their assistance, who thought, as he did, that the
proposed measure could do nothing but aggravate every existing
calamity. He would call upon them to unite with him in oppo-
sition to measure., the prejudicial effect of which upon public
credit lieeame more and more manifest every twaty-four hours.
.Ifibinnis were left alone, he believed they wouki improve; but if
*se measures were persisted In he was confident that alarm and
"einharraisment would daily increase.
Alderman THOMPSON took similar views of
the subject. It was with regret he felt compelled to
diwterit upon this otcasion from Ministers, with whose
•.frairrici:les of conimercial policy he general(' agreed.
Was it upon the priakefple. of , thewt. glivasnr.io
1 • . • .
that he dissented troth them, his objections ap'plied only
.to the moment of their introduction. Ile thought Oka
cause of the present distress was a combination Ogulls
speculations and excessive issues.:•reciprocally
lating and promoting each other. In the years 1825.
24, and '25, a progressive increase of the currency took
place, and the manufacturers were getting high prices;
'but when the check took place, the consequences were
dreadful. The failure of one or two Banks produced
a general run upon all, and produced the failure of 70:
-He would attempt an estimate of the degree in which
the circulation of the country had been diminished by
these circumstances. Supposin_g the 70 Banks which
had failed to have issued 50,0001. each upon the average,
and this he thought a very mot:nate estimate, here
•would bia diminution to the extent Of three millions and
a half. If the whole provincial circulation had been
twenty millions, this would reduce it to sixteen and a half.
From this a-nount he would deduct fifteen per cent. on
the diminished issues of all the houses which hadstm,d,
but all of which bad, as a measure of necessary pre-
caution, withdrawn a portion of their paper from cir-
culation. This would give two millions and a half
more, making altogether a reduction of the provincial
circulation to the amount of six millions. What
serious effects then might be expected to flow from a
further reduction of four millions, which would be
produced by calling in the one and two pound notes.—
It was said their place would be supplied by gold. But
how is the gold to come ? We cannot get st except in
return for our exports. We are not exporting however.
-There is a general stagnation. Although commodities
generally have fallen twenty per cent. the foreign de-
mand, neither for manufactures, nor fur colonial pro.
duce, appears to be stimulated. Such is the general
distrust that no merchant can get discount for a bill.
The importance of that portion of the currency which
it was proposed to annihilate, was net duly appreciated.
He was connected with a manufacturing district, in
_which the amount paid monthly for wages alone, and
paid in this di:cription of cunency, was not less than
two hundred thousand pounds, and to the honour of
the Bankers of that district, he would say, that during
the late pane not one et them had failed. The manu-
facturer obtainid in payment for his goods the accept-
ant.: of a men chant, probably of London, or Liverpool,-
or Glasgow. By the accomm.,datitin of the Banker sal
his neighbourhood he could get this bill converted into
currency, but if the currency was to be gold this
could no longer be done. As to the idea of Joint Stock
Banks, he viewed it as a fallacy and a delusion. The
•mese number of partners in a bank wi'l not inspire
confidence. Ti.e prudei,ce of a Banking Company, and
the manner of conflating business, is more considered
than the magwtude of capital embarked. Bran ch
Banks from the. Bank of England, if It Could be induced to esta-
blish them, would, be befitted, be productive of great good. lie
would conclude by
.expressing Isis opinion, that in the present situa-
tion of the country it Would be an act of madness to proscribe the
small note circulation. lie had felt it his duty to say thus much,
and-be hoped the House would well weiglethe consequences before
it adopted the proposed measure, bearing in mead bow inoeb more
oilieuit at eras to bond up than to destroy. „

Mr. LEYSTEIt said, if all were left to the Country
Bankers, all would be at sea without compass : the
consequences of
.departing from tbe uaity of the power
of jawing peper.n.uney...••4 A mob is the iliat• was as

[PRIcE SEVEN PENCE.

- .
bad as a mob in the House." . He was sorry that the
Chancellor of the Exchequer did not go further. Why
were not five pound notes 'withdrawn? As to the
Joint Stock Country Banks they were liable to many
ohjettions; the creditors *ould be worse off than ever Besides,
Country Banks that were substantial would not take additional
partneta, not desiring to part with good things; unsubstantial
hanks would noVtive new partners, rot c4ring to declare their in-
solvency, aol to hoist the Bag of distress. And there was mere
chance of a black sheep amongst twenty than a mongstsix.
Mr. T. WILSON could nit anticipate the least ad-
vantage from the measure; it had produced, was pro-
ducing, and would produce the greatest evil. He would
not speak as the representative of any particular class
—he spoke as the Tepre:entative of the City of London.
‘Vhat had been the situation of the City of London ?
A; the mornentavhen Banks were failing every day, the
alarm and panic had not been easily arrested. Here
the lion. Member adverted to the meeting at the Man-
sion-house, and warmly eulogised the conduct of the
Hon. Member for Taunton. What was the cause of
the lamentable condition of the country? Is it war,
famine, or pestilence? Hs; a war broke out suddenly,
and have our merchants Wit two or three millions of
foreign debt? Is it that we have bad a bad harvest,
and that a million of money is going abroad to pay for
corn ? None of these things. The simple fact is that
we hive overtraded. But it is not the first time we
have done so, and we should now, as we have formerly
done, get out of out difficulties if confidence could be
restored. But confidence was a delicate thing. Villent
measures could not restore it, men could not be dra-
gooned into confidence: He had. been happy to see
that the suggestion of his Honourable Friend the
Member for Taunton, had been thought worthy of
the. attention of the President of ,the Board of 1i ade.
!—He alluded to the, proposal for a mixed cto tenon—
We received a great quantity of silver from South
AmeriCa and other places. What could we now do
with it ? Buy sovereigns at a loss of one and a half
per cent. , The Honourable Gentleman then proceeded
to explain at some length the advantiges which he
thought would arise from a currency of a mixed basis.
It had been urged that if the system of small note cir-
culation was not now got rid of there would be no
hope of its dangers commanding attention when prosperity had re.
turned. He could not see the force of this argument. The Minis-
ters were-ia favour of its abolition, many-Honourable
.Members
on the opposite side of the Horse were• equally so ; was it to be
supposed that they would lose sight of their object, merely because
circumstances had become mote favourable to its attainment?
Great sympathy had been expressed for the sufferings of the poor.
His opinion. was, that the proposed measure would inflict addi-
tional distress upon that portion of tbe community. He reevm-
mended the plan of requiring enmity for small notes in prefe-
rence to that of prohibiting them altogether. The measure, he
apprehended, would beat the least nugatory, or, if it produced any
effect, it would be mischievous.

Mr. J. SMITH defended the conduct of the Country
Bankers, and observed, though he should give his vow
upon the Rresent occasion to Government, they ought
to weigh 'well the cause of the-pante, in giving their
aid to prevent its re-crecntence. The blame was lard
on Country Banks, and he might fairly and reasonably
say wire tbiy to bhme 2= No I He *new, and *is
ported-in his. statement try the 'testi moray of several en-
' fortunate Country Bankers themselves,that they frowned
on the spirit of specdlation and employment' of capital
which had existed. The feeling which existed was, that
they had lent themselves to aisist in the mania. Now
he contended that the conduct of those unfortunate in-
dividuals had nothing at all to do with that Madiplrit
of speculation. He thought his Hon. Friend's speech
was rather precipitate—he had alarmed and agitated
I large and respectable body of men, who bad not en•
couragcd it, but sought rather to encourage the trade
and commerce of-the kingdom. They surely did not
deserve the sweeping cetisure which had been parsed
upon them, with respect to the alarm and panic which
had spread far and near; he thought his Honourable
Friends tnight have used a little more caution; would
it not have been better had the matter passed over for
a short time before the question of currency was brought
for ward and discussed ?—he• should have thought at
least a month of two hence would have thaws' more
prudence, and must say, that in the haste and hurry
which had been .exhibited the parties had overstept the
bounds•of propriety. With regard tothe currency every
body cried cut fora gold currency with the same
warmth which they applied for a silver orw. He ;evil.
lected a circumstance which occurred some.few years
age,in which cert.rin par ties were detected carry ing about
in a cart, a itira false bottom, immense quantities of
bad and corrupted silver, and though their puoshment
was heavy, it was totally inadequate to the offence. Though we have
now a silver coinage of unexampled brilliancy and beauty, he bad
not heard of a single counterfeit crown-piece, and therefore put the
' tact to ibis lion. Friend. One incident recently Oise within his
1 knowledge, which marked strongly the inconvenisncies arising from
a lack of silver, and which was, that a mercantile house, high is
repine, had not atmally sufficient to pay their workman of the
dourday night, and were therefore compelled Iron necessity to
'lune small orders on paper, which they tendered about in lien of
payment. The circumstance which most marked the inconsiderate
haste which was shows is bringing she speedos before the liouse
was, that en the 13th of January, in the pram* you, the metro-
polis was comparatively tranquil. and the pink had somewhat sub-
'sided, yet on the of February following it was aroused, and had
not yet subsided, and mesa** the questiMs having beet brought
forward, be sincerely trusted that the Mosso would, by some wise
and praiseworthy resolution, bring thematte, to an issue at sum.

Mr. C. GRANT was surprised that his Him.
who had just sat down, should have closed his'speeck
with a wish that the ouse should .bting the matter to
an issue, when in the earlier pail of his remarks be bad
expressed his regret that the question had not bees
allowed' to slumbet for a month or two. He begged
leave znost materially to differ with his Fiseed,
and mug beg leave to say that the House would have
fa•led in their duty to the country if they had she mac
from immediately bringing the question befute them at
the commencement at the Selman. It might have bet .n
considered p•liaic if it bad not been discussed until the
panic was hushed, but as it was, he considered the mea-
sure a wise one, for had it not thus early been taken
up it would, in his opinion, have been a shansetel 4.4.e1e-
Itction.of duty, and the sooner the effects of else panic
were overcome the better. In one opinion, he believed,
they were alt agreed, and that was, that the. distress
which was then raging with such violence would, at no
distant pesiud, pass awa7t And .conhdthice be fully re-
sumed in the different irroeattorts fit trade and continence.
It was always found that in pteporttun,to the depth of
the enite;Silies so would the re-actioa be Sound •