The Liverpool Standard and General Commercial Advertiser.
Liverpool, Merseyside, England, 1851-06-03 00:00:00

MONETARY REFORM THE'TITAL CONSIDERA-
TION FOR HOLDERS OF COMMODITIES AND

STOCKS, WHILE IT IS THE GREAT MEANS
OF PROTECTION TO BRITISH LABOUR.
TO THE EDITOR OF THE LIVERPOOL STANDARD.
Liverpool, 26th May, 1851.
SIR,—Agreeing entirely with Mr. Duncan's principle
of paper or emblematic money, I am also persuaded that
a day will suddenly arrive when almost every man in Li-
verpool will be anxious to join a monetary ex} ostulation
with Government and the Legislature. I think ,however,
that any sort of paper money, properly-securt d, will be
found as good for the purpose of preventing wercantile
fame as any other, (although the plan of Mr. Duncan,
the issue of government notes, would of cow se reduce
taxation to the extent of the interest on the circulation of
the government paper) ; and my object is now to shew how
small a change in our monetary legislation is required to
lave the holders of commodities and stocks.
THE TRUE PROTECTION TO BRITISH LABOUR, AND

THE ONLY POSSIBILITY OF CARRYING OUT FREE TRADE,

MUST ARISE FROM OUR GIVING THE FOREIGNER IN OUR

MARKETS DEPRECIATED POUNDS, SEEING THAT NNE MUST

GIVE HIM THE SAME NUMBER tal,

THESE POUNDS AS WE

GIVE TO OUR OWN AND OUR COLONIAL PRODUCERS WHOM

WE PAY IN GOODS DEPRECIATED* BY TAXATION; for in-
stance, the American and Englishman get the same nomi.
nal price for the same quality of wheat in the Liverpool
market, but the latter is paid in British goods, whose
prices include the heavy taxation of this empire, as well as
our enormous local burdens, while the American, instead
of getting paper money, which will buy gold at a Blitish,
or enhanced, price of £5 per ounce, gets paper uoney
which he can convert into gold at the foreign or untaxed
price of £4 per ounce, so that instead of selling his bill in
New York (for the proceeds of his wheat) for 25 per cent.
discount, or for £75, he sells it at £lOOl-; and thus he can
bring back 25 per cent. more wheat, to oppose the British
agriculturist, than the latter got in British commodities in
exchange for Ms wheat. It is thus clear that though they
got the same nominal amount in money, they did not get
the same quantity of commodities for the wheat sold in the
Liverpool market-T. I, however. think it best to throw my
views into the shape of a memorial, as this is the form in
which they may come to be wanted ; and reflection has
shown me that a monetary movement will be more effec-
tually and quickly made by us as a community than as an
association or league, while this would also have the ad-
vantage of preventing, for the present, any rencounter of
particular men's former antipathies on other questions,
such as Freetrade and Protection, if not of disarming
such hostilities, about mere nominal differences of opi-
nion, in the future, among all men who have no interest

in party or faction.
We may be divided into two great classes : there is,
first, the men who have hitherto had their character
mainly as a means of supporting their families; second,
the men who have large realized capital. The former
class cannot (now that there is a perpetual cheapening
going forward) be expected to stand the losses which are
common ; and they cannot hereafter be trusted by the
Bankers, who have therefore to give their money cheap,
althoueh it is not plentiful. to the diminished number of
bidders for their discounts (comprised in the second class).
The second class, to xhom I have alluded, of our mer-
chants, see too that their ruin is only delayed—the same
class, or the capitalists, among the manufacturers being al-
ready anxious to throw their capital out of co-operation
with labour seeing that " wages cf labour" cannot in their
downward course be made to keep pace with the decline
in prices, so that there are now no " wages of capital."
All these men of capital must in the mean time continue to
reduce their means, and in their turn will be overthrown
when the Bankers come to lose their credit (which is the
chief thing Bankers lend to the public)—A THING INEVI-
TABLE under our present money law, whenever gold comes
into demand for exportation, as from gold not being
allowed to rise in price even when, being scarce, it
has risen in value, money has to he made scarce and dear
by the Bank of England, as in 1847, this being the only
means of crushing down prices of commodities to the
point that will express the difference between the value
and the price of gold. The foreigner then gets more
money for his gold, by the poor man being thus driven to
give more of his time and labour for the same money;
and till this point is reached it is (under our unpatriotic
money law) the foreigner's interest to take our gold,
leaving our manufactures, causing in this way commercial
panic and universal bankruptcy. The present cheapness
is that self-same curse to the community which Mr. Hus-
kisson pointed out in the great speech which he made in
the House of Commons, on the 18th of April, 1826,
against a reduction of prices arising, not from increased
abundance, but from decreased ability to consume manu-
factures ; § but, nevertleless, and althoueh I am a pro-
tectionist (except where I can get two-sided free trade),
I would not recommend the poor man to submit to pro-
tection through the Custom-house at present, or ever
again to allow his interests to be tossed about as the mere
foot-ball of contending political parties. Having got the
cheap loaf," our population should stick to it till it is
gradually raised in price simultaneously with their wages,
and with the prices of all other commodities, in the only
legitimate and permanent way—viz.: by means of free
trade in money; and it seems to me that it is clear, from
the late report of the London Association for Protection
to British Industry, that the protectionists having come
to see that " free trade in money" is virtually " protection
to commodities and wages," will now be willing to con-
fine their present movement to the attainment of " the
reform of the currency"—raising no questions about in-
creased customs duties, or about the navigation laws, till
it is seen how far monetary reform will go to carry out
their patriotic view of preventing our national employ-
ment being given away to foreigners.
Mr. Duncan's principle of money is no doubt correct,
and the public are infinitely indebted to him for his gigan-
tic and self-sacrificing efforts to popularise a great princi-
ple; we may even admit that had we to originate a sys-
tem in a new country, his plan, or details, might be what
we would adopt ; but surrounded as we are by circum-
stances and prejudices in favour of gold as the security of
the circulation (if not as the standard of value), the mer-
cantile community must tell Mr. Duncan plainly that we
cannot submit to any sudden revolution of our monetary
system, especially as we see that we can attain his prin-
ciple of paper money as well through the present machi-
nery of the Bank of England, as is shown in the memorial
subjoined. We must first secure paper money through
our present bank system ; and when this is done most of
us will have no objection to see Mr. Duncan's system of
bovernment paper money established alongside of it, and
gradually supplanting it, to the extent the public get con-
fidence in taxation notes, or to the extent these displace
the circulation of the present banks.—Yours respectfully,
A LIVERPOOL MERCHANT.

'8 They get less in quantity to the extent prices have taxation
added to them ; and if taxation cannot be added to price, it
must become a deduction from wages.
Indeed he sells his bill at .109 to £llO when the exchanges
between the countries are at par ; but this arises from the
Americans having protected their currency, by making the
sovereign a legal tender with them at a price which is upwards
Of 9 per cent. higher than it is a legal tender at in England.
It is a very great mistake to suppose that this hardship to
Our home agriculturist would be reduced by our being able to
induce the Americans to take manufactured goods to the full
amount of the produce they send us. On the contrary, the fact
is, that the proceeds of the American wheat sold in Liverpool,
to which I have alluded, would in every case be accounted for
in pounds sterling worth the same invariable weight of gold;
and the American would actually be able to compete more
successfully with the British farmer the more goods go to
America from Manchester, Birmingham, and Glasgow, as this
would turn the exchanges more in favour of England, and thus
give him more money in New York for his bill on Liverpool
for £lOO sterling. But even the Manchester men begin to see
that the blighting effect upon prices, of our present unpatriotic
money law, is no less detrimental to our manufacturing than
it is to our agricultural population. Any one can easily
see this who is aware that the prices of our manufactures
both fot home and foreign trade are dictated, in the long run,
by the price which the foreigner is willing to give us for our
surplus production ; such a person must, with the least con-
sideration, have no difficulty in seeing that gold at a fixed
foreign price becomes an iniquitously false standard of value,
to the extent any taxation or profits are added to the price of
British productions. I have often before shown how it is
only when things in this country are as depressed as gold at
£4 the oz. that the foreigner prefers taking British goods. He
then gets, say, 808. for 20 bush. wheat, and his choice of a remit-
tance is between 80 yards of cloth at is., or one ounce of
gold for 80s.; but when a good state of the home trade gives
him 100 s. for his wheat, he can get an ounce and a quarter of
gold, whilst he finds the cloth also scladvanced in price that
he can of it get no more than 80 yards as before (the cloth
rises in price, the gold rises in quantity!) The foreigner's
taking the gold not only reduces the employment of our arti-
sans, but throws the home trade into confusion, the export of
gold always having the effect of extirpating our currency and
bank facilities. Thus it is that we denounce a low fixed price
of gold as a gross injustice to British industry, while we would
wonder that it should have been allowed to exist since 1819,
did we not see that under the old protective system, (up to
1846), our general exports were kept above our general imports,
so that foreigners could not actually remove our gold ; they even
then, however, had the advantage of us in selling dear to us when
things were prosperous here, while they had it in their power
to take a draft on their own country at the low exchange of
sovereigns at .W 3 17s. 100. the oz.—which in America being a
legal tender at 9 per cent. higher, will make our now, low prices
9 per cent. better to the American as compared with the nomi-
nal price of his commodity in America. And we trace all our
industrial evils to Peel's having in 1819 made money a foreign
interest in the state—an interest to which the distress of all
others is prosperity ("dearness of money I") and Peel's system
of free imports, while money remains a foreign commodity, at
a low foreign price, we view as equivalent to depressing Eng-
lishmen to the level in remuneration, and below the level in
comfort, of the foreign serf or slave—regardless of the habits of
John Bull or of his circumstances, as having to support an ex-
pensive Government, Church. and National Debt, with local
and corporation burdens amounting to about as much more.
§ The following are Mr. Huskisson's words :
am the first to declare my conviction, that if from any
circumstances the price of wheat were at this moment to be
reduced materially below what it now is, there is nothing which
could more contribute to aggravate the existing distress, and
to take away the best chance of early relief. Sir, I say this
advisedly. I say that the present average price of wheat is one
which could not in my opinion be materially lowered without
producing more of suffering than of relief to all classes of the
community. If the house could suddenly and materially
reduce
it the price of all necessaries of life, so far from relieving,
would only aggravate the general distress.

" Cheapnesx, without a demand for lemur. is a symptom of
distress. Cheapness always prevails where enterprise is at a
stand.

,‘ 1. admit that if unlimited foreign
imports, which the war
has suspendel, were now again allowed, bread might be a little
though a very little, cheaper than it now is for a year or two.
farmer would be ruined ;
But what would follow ? The small f:
improvements would everywhere stand inferior lands
now producing corn would be given up and returni;
demand fotrrittehd:
to a state of
waste ; the home consumption and brisk
various articles of the retailer (which have so much
prosperity of our
even during the pressure of war, to the pros
towns, and especially of those which are not connected with
.
manufactures or foreign commerce) would rapidlydecline;
farming servants, and all the trades which depend on zg
culture for employment, would be thrown out of work, anditrii,;
necessary result of the want of work would be that wages would
fall even more rapidly than bread."

SKETCH OF A 31EltIORIAL TO THE QUEEN
AND THE OTHER BRANCHES OF THE
LEGISLATURE.
THE MEMORIAL. OP THE UNDERSIGNED MERCHANTS

OF r

SHIEWETH,--
That it has become, and is daily becoming more and
•—.