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in this country, but which is gradually operating all over the civilised world. That in proportion as the government of any country is settled and strong, the use of the precious metals is found less necessary at home, and it is therefore exported to those countries in a less civilised state, the relations with which can only be carried on by actual value. Hence may we also account for the greater abundance of the precious metals in France, and elsewhere, than in England, from the late unsettled condition of the Continent; and if it be so, which I cannot but believe, how shortsighted must we not be to mistake, as a cause of alarm, that which, properly understood, is the surest proof of our stability and strength !
It appears, therefore, that we may with safety, in the present state of things, abandon the idea of any extensive currency in the precious metals. Let us, indeed, endeavour to produce a perfect representative currency' by every means in our power, having its standard regulated by the average of all prices. Let the redemption, on demand, of that currency in gold, at the market-price, be duly guaranteed by law, under any regulation that may be most convenient; so that gold may, in all its shapes, only be cousidered as merchandise; and that those fluctuations of its value which, under present circumstances, it is impossible to control, may be allowed to regulate themselves, without affecting the values of the circulating medium: but, above all things, as we have not the means of supply for a currency in the precious metals, let us not withhold an adequate proportion of the substitute. The worst evil that could befal the country, in the present moment, would be an INSUFFICIENT CURRENCY, let that currency be of what it
The reduction of our circulating medium below that amount which the actual state of the property in the country requires, would operate at once like a reduction of that property; for if the country possesses not the means of representing, in its transactions, the wealth it possesses, it is tantamount to a partial annihilation of that wealth. The activity of intercourse between man and man, and of industry, must be crippled, and the value of
property must consequently be diminished. How then is the country to meet those engagements, in a state of means thus reduced, which were contracted under circumstances so different ?
But it is said, that by the reduction of our internal facilities prices will fall, and our foreign commerce consequently increase ; that then the balance of trade will be in our favor, the exchanges
1 I shall endeavour hereafter to shew the public, that this may possibly be best effected in a non-intrinsic metallic currency, formed on new principles:
will rise, and gold flow in abundantly. To me, I own, this appears to be working in a circle--it must all come round to the same thing ; for if exchanges are thus to be raised, the prices which the foreigner will therefore be made to pay for our manufactures will not ultimately fall: therefore, he will take no more of us than before, and the end will be, that we shall have created distress at home without any increase of trade abroad. But, even if we could, at this price, ensure an increase of foreign commerce, let us not forget that we may thus be sacrificing greater interests at home. Let us remember how small a part of our resources depends on our foreign commerce, compared to those involved in our own empire and its dependencies, and that the great object of our solicitude, therefore, should rather be to legislate with a view to the prosperity of our domestic than of our foreign concerns.
If prices must be reduced, let it rather be done by increasing than diminishing our internal facilities, and thereby augmenting the actual quantity of our produce.
I cannot, for one, be persuaded of the truth of the proposition, as it is generally received, that the bank-note system has produced a rise in prices. To suppose that it could raise prices by any direct operation, would be to suppose that the community at large would purchase bank notes at a certain price one moment, and pass them the next at a reduced value. So far, therefore, from thus producing a rise, I say that the real operation of this system has been to produce a fall, and that all manufactured goods in this country are actually MUCH CHEAPER than they were before our increased facilities :- look at our Manchester cotton goods, our Glasgow muslins, our Birmingham and Sheffield hardware, and other such commodities.' That the prices of corn and land have increased is true, because the consumers are increased, and labor drawn into other channels; but in all those articles which are partly produced by labor and partly by machinery, and they form the bulk of our export trade, in those, with a few exceptions only, from partial causes, the prices are fallen by the increase of the facilities of production, and will fall by the continuation of that system, and by that system only can they be reduced without misery ani ruin: and not by compelling our manufacturers, by distress, to sell their produce at prime cost !
On the contrary, give the manufacturer encouragement and facility, his inexhaustible ingenuity will still find cheaper means of increasing his produce, and his prices will fall. Such a fall may be effected without danger, because the increase in quantity will be
1 Most of these articles have fallen upwards of thirty per cent. during the period in question.
equivalent to the reduction in price. Nor is there any danger that the i foreign manufacturer will be able for many years, if at all, to , compete with us in the cheap production of those commodities, the, manufacture of which depends on the vast extent of our capital and machinery, whatever advantages he may possess in the price of labor, unless we ourselves destroy those very means and facilities which now exclusively belong to us, and on which our exertions depend. But if, on the other hand, prices are to be reduced, as contemplated, by withholding the means of exertion, (for such, in other words, is the withholding the present facilities of trade,) so that with the reduction of prices a reduction of produce will also take place, what is to become of the country with its present incumbrances! The probability of such an event has already shrunk the value of property in an alarming degree :-what may we not dread from the reality ? Let it be remembered that the numerical amount of our debt is recorded in figures that cannot be changed, though the numerical value of the property of the country may be so.
If then, with the present proportions of these numbers, the interest of the debt is sufficiently burthensome to the people, what will it not be if you diminish their means of paying it? What would the country say if it were proposed to collect another million of taxes ? and yet, if we are not careful how we reduce the prices and values of things, the debt not being reducible in the same way, we may commit some fatal financial error, which shall be equivalent to the laying on of ten millions of new taxes !!! I must repeat, again and again, that the worst of all evils that can befal the country, in the present moment, would be the want of an AMPLE CURRENCY, let that currency be of what it may. The crisis is most eventful, and the doctrines that are abroad dangerous and fallacious in the extreme; and to say the least of them, of doubtful origin. False theory and sophistry will have done their worst, if they pull down the financial and commercial supremacy of this country!
England has hitherto been the only nation, the strict administration of whose laws, and the inviolability of whose good faith, has enabled it to call forth energies in proportion to its general wealth ; while other nations have been confined, or very nearly so, to the limited resources of their wealth in specie. Let us beware, therefore, how, from not duly appreciating the immense power that we thus derive from our unparalleled public credit, we commit an act of suicide upon our greatness, by any unnecessary sacrifice of the advantages of a system to which we are so inuch beholden.
Let me not be misunderstood.-It is not the Resumption of Cash Payments that I fear, if that measure were practicable to such an extent as to render it a permanent arrangement, which I sincerely believe it is not. What I dread is, lest we should commit some
fatal error in the reduction of that quantity of the circulating medium due to the state of property and the necessities of the country, in the attempt to force this return of Cash Payments; which I not only (for the reasons herein stated) do not conceive essential to our welfare, but the operations of which, I think, in the present state of things, may be better performed by an artificial currency, under the guarantee and regulations above stated.
But wherefore all this anxiety for the Resumption of Cash Payments in the present moment? I must confess I am at a loss to account for this scramble, as it were, for gold and silver ; as if we were on the eve of a general bankruptcy, or were bent on universal emigration. That our debt amounts to a very large sum, is true; but all quantities are only great or small by comparison. With an income of upwards of two hundred millions, a debt of eight hundred millions is but the arrear of four years of that income. A private family would not be considered in very desperate circumstances, which might be so in debt, even to strangers. In the case of the nation, therefore, which is that of a large family, where the debt is due only from one branch of that family to another, such an incumbrance can produce no serious evil while the family remains united. With moderate economy, and proper confidence, such an arrear will liquidate itself without inconvenience, if we check not the industry and energy of the country by unfounded alarm, and by ill-timed interference !