purchase as much corn with the half sovereign as before you could with the whole corn would then be nominally diminished half the price, but in reality would be just as dear as before; but then in this operation two sovereigns would in effect be required to discharge the taxes and debts, for which before one would previously suffice. Thus it is the Act of 1819 overwhelms the industry of the country; it makes the pound sterling of double the value it was before, and it will consequently buy nominally twice as much corn; but the pound, being itself of double value, purchases no more than before: whilst in reality two of the previous pounds (or one made by Act of 1819 of the value of two, which is the same thing) becomes necessary to discharge the debts and taxes for which one would suffice before. I say, then, the Act of 1819 is a thousand times more ruinous to the landed interest than would be a free trade in corn. It is also equally grievous to all other industrious classes: it lays the same heavy weight of double taxes and charges on them all: in short, it imposes a weight we cannot sustain. You have, my Lord, a third time before you, by the intense sufferings of the people, the cruel proof of the impossibility of preserving in substance that unfortunate Act: you are obliged to counteract its destructive effects by the various means I have recited, and which are fraught with such imminent danger. Why then continue to keep it, as it were, to the eye? Why continue to deceive the people, and incur such dreadful risks, rather than confess at once you have attempted that which you find it is impossible, UTTERLY IMPOSSIBLE, to accomplish, and, in fact, was unjust to attempt, or to do, if you could? You cannot surely regard the clamors of those who would triumph on such a change of course, but who dread nothing so much as that you should adopt that change: there are those who know perfectly well that to enforce a recurrence to the ancient metallic measure of value would dissolve the very fabric of society, and produce an absolute chaos in the country; they delight in the old attachment to the old standard; they encourage the popular delusion of low prices; they struggle to keep the eyes of the people yet closed on the liability of money to be cheap and dear, or scarce and plentiful, as well as any other commodity. They have, unfortunately, in that Act of 1819, a nail put into their hands, more likely to drive to their purpose, than any that a weak government ever put into the hands of those courtiers and deluders of the people, whose sole aim is mischief. Still I hope and believe their good sense will triumph over such attempts; the more informed and considerate part of the people are becoming practically acquainted with the real state of things. They will lead into the right course, and your Lordship and the Government and Legislature will follow. . Men of business, people engaged in agriculture, commerce, and manufactures, begin to see and feel, what it is extraordinary indeed they did not from the first, that, as money was reduced in quantity, and thus rendered more valuable, their commodities would fetch less of it, and all their debts, charges, and taxes, become so much the heavier, and that when the reduction was great, the burthens would become proportionably great, so that they would, and did, sink under the weight of them. The laborers and handicraft people begin to see that the very first natural effect of the distress of their employers is to throw them out of employ; they see also that the first effect of reviving markets is to create a demand for their labor, and consequently give them again a comfortable reward for that labor. They are the first to benefit, and the first to suffer. The popular deluders have indeed been too successful hitherto in cultivating the contrary belief; but I repeat my conviction, that the eyes of the people are becoming wide open to the fallacy, and would long have been completely so, if Government had not done everything to conceal from them the varying quality and value of our money under the operation and changes of late years. I shall now briefly recapitulate the points I have endeavored to establish, and then state the measures which, it appears to me, the safety of the country renders indispensable, and which, at the same time, justice requires us to adopt. In the first place, then, it has I think been made evident, that the ancient metallic standard established by the Act of 1819, is utterly at variance with the measure by which all the financial and commercial operations of the country had been carried on in the preceding quarter of a century; and that every attempt to act on it has been attended with the most disastrous consequences. That a credit currency has been formed, practically effecting a measure of value differing from, and lower than, the ancient metallic standard, conformable to that which existed prior to 1819, suited to the situation of the country, and under which, during its continuance, every interest in the country has eminently prospered. That this practical measure of value thus differing from the legal, a struggle has incessantly existed; and that, as one or the other predominated, a perpetual change in the value of all property has taken place; and which fluctuation must be continued to the utter ruin of the country, unless the legal standard is made conformable to the necessities of the country. Under these circumstances, I venture to declare it to be my unhesitating conviction, that the course unavoidably necessary to be adopted, is, to obtain an Act for the protection of the Bank for a limited time, say to the end of the next session of Parliament, so as to allow us again with safety such an extension of our credit currency as the necessities of the country require; and give time for deliberation on some plan that shall render such currency secure, and free from those fluctuations under which we have so dreadfully suffered. I cannot conceive what description of persons could complain of an alteration of the currency, the only perceptible effect of which would be to place the country again in that state of prosperity we so recently enjoyed, and at the same time give us every reasonable ground to rely on its per manence. Such an alteration implies, it may be supposed, a material alteration of the ancient metallic standard; I think justice requires such an alteration;-justice, because that standard imposed on the public debts they never incurred-taxes which it was never the intention of the Legislature to lay, and which it has been proved the people cannot pay and cannot bear; and which you have, therefore, by secret means, by those I have stated, relieved them temporarily from paying, and which I only ask you openly, honestly, avowedly, and permanently to do, instead of secretly. It is time to deal fairly and openly with the public on the subject of the currency, and let them know the variation to which it has been subject, and make them understand the influence that it has on the price of commodities; that without a given proportion of currency or circulating medium, there never can be an adequate price for any product of industry and labor, nor for the wages of the laborer; and that with an excess of currency the prices might be too high, or in other words, money too cheap or plentiful. They would then be able to discern when the price was governed by a scarcity or abundance of money, or a scarcity or abundance of any commodity itself. The public eye would thus be, as it ought to be, with a credit, or indeed any currency, eternally on the watch; and measuring it with the price of commodities, would keep it within bounds, or at least operate very powerfully towards doing so a metallic standard then adopted on a level with the present state and situation of the country, would, aided by public opinion, operate effectually. There is no class of people for whom I contend a just alteration of the standard is more necessary, than for the public creditors, and indeed creditors of every description. There is nothing else can prevent their being involved with their debtors in one common ruin. I Let the public creditor consider too, that the public securities have al OUR MISFORTUNES MAY BE RETARDED; YOU MAY OVERCOME THE EXCESSIVE PRESSURE OF THE MOMENT, BY AGAIN FORCING OUT PAPER, AS I BELIEVE YOU ARE NOW DOING BY ALL POSSIBLE MEANS; BUT THE BLOW WILL FALL THE HEAVIER AT LAST. WE CAN ALONE BE SAVED FROM IT BY REMOVING THE SOURCE OF THE EVIL. I beg your Lordship to believe that in this address I have no object but the welfare of the country at heart, and that it is with reluctance I have found fault with your measures, rather than with any desire to condemn them. Felix Hall, May 14, 1826. I have the honor to be, MY LORD, Your most obedient humble servant, POSTSCRIPT. I HAVE remarked at the commencement of this Letter on a passage in the printed Speech of Mr. Huskisson of the 23d February last, in which that gentleman states, that the different periods of distress and prosperity which the country has recently gone through, have been accompanied the first, by great contractions; and the second, by equally great expansions, of the amount of the currency. I have stated my conviction to be, that in each instance the contraction of the currency has been a forced measure, adopted by the Government for the purpose of attempting to establish cash payments in the old metallic standard; and that such forced contraction has been the origin and cause of all that distress which Mr. Huskisson describes as coincident with it; and further, that those different expansions of the currency which he describes, arose out of measures adopted also by the Government in order to relieve that distress which they had themselves occasioned, but which they found to be in effect in ways risen with an expansion of the currency and fallen with the contraction, and in no instance so striking as in that immediately before us. tolerable. I have since been referred to a statement made by your Lordship, which establishes that with respect to the late and present distress, that distress was preceded by a great and forced reduction of the notes of the Bank of England, which form the basis of all our paper money; and any great and regular diminution of which, must of necessity be followed by an equally great reduction in all the paper money of the country. Your Lordship states (see the Times newspaper of Feb. 18, 1826, containing the report of a Speech of Lord Liverpool, of the preceding day), that, "In March 1825, they (the Bank of England) saw the necessity which was pressing on them, and they then did begin to draw in and reduce their issues. In the month of March, they reduced their issues 1,300,000l. Between the 15th March and 15th May, they made a reduction to the extent of 700,0007. more. Between August and November, they further contracted their issues, making altogether a contraction of 3,500,000l. in their issues.' And, "Thus then the Bank had reduced their issues between February and March 1825, from twenty-one millions to twenty millions, between May and August, to nineteen millions, and between August and November, to seventeen millions." What then was the nature of that necessity, which in March 1825 pressed on the Bank, and compelled that body so to draw in and reduce its issues? They had notes out in nearly as large an amount, making the calculation on notes of 51. and upwards, as at any former period: prices were comparatively high: the country was prosperous: but the pressure of the Act of 1819 hung over this state of prosperity, and by that Act the Bank was compelled to give gold in payment for its notes, at the old price of 31. 17s. 10 d. an ounce. When the prices of all commodities had advanced, and when gold was the only commodity to be had at a low and an old rate, then gold of course was demanded; and the Bank of England, pressed by that demand, was compelled, by a regard for its own security, to withdraw its notes from circulation. The necessity which pressed on the Bank therefore, was imposed on it by the Act of 1819. If that Act had proceeded on a just and equitable principle, if a just and proportionate standard had been taken, instead of that which had no relation to the money transactions of the time, the demand for gold, which was experienced from the latter part of 1824 down to the period of the panic, would never have taken place; no necessity for such reduction of its issues would have been felt by the Bank; nor would a ruinous, sudden, and unexpected fall of prices, from |