-NRLF SB 173 K K Z K O O * O H CO W , h ( S5 D WORKS BY THE SAME AUTHOR, PUBLISHED BY JOHN DOYLE, BOOKSELLER, NEW YORK. COBBETT'S ADVICE TO YOUNG MEN, and (in- cidentally) TO YOUNG WOMEN, in the middle and higher ranks of life. In a series of letters addressed to a youth, a bachelor, a lover, a husband, a citizen or a subject 18mo. 50 cents. COBBETT'S GRAMMAR OF THE ENGLISH LANGUAGE, in a series of letters. Intended for the use of schools and of young persons in general ; but more especially for the use of soldiers, sailors, appren- tices, and ploughboys. To which are added, six les- sons, intended to prevent statesmen from using false grammar, and from writing in an awkward manner. 18mo. 50 cents. COBBETT'S FRENCH GRAMMAR ; or Plain In- structions for the Learning of French, in a series of letters. 18mo. 75 cents. COBBETT'S COTTAGE ECONOMY: containing information relative to the brewing of beer, making of bread, keeping of cows, pigs, bees, ewes, goats, poultry, and rabbits, and relative to other matters deemed use- ful in the conducting of the affairs of a labourer's family ; to which are added, instructions relative to the selecting the cutting and the bleaching of the plants of English grass and grain, for the purpose of making hats and bonnets; and also instructions for erecting and using ice-houses, after the Virginian manner. To which is added, THE POOR MAN'S FRIEND ; or A Defence of the rights of those who do the Work and fight the Battles. 18mo. 50 cents. COBBBET'S AMERICAN GARDENER ; or, a Trea- tise on the Situation, Soil, Fencing and Laying out of Gardens; on the making and managing of Hot-Beds, and Green-Houses ; and on the Propagation and Cul- tivation of the several sorts of Vegetables, Herbs, Fruits, and Flowers. 18mo. 50 cents. COBBETT'S HISTORY OF THE PROTESTANT REFORMATION, IN ENGLAND AND IRELAND ; showing how that event has impoverished and degrad- ed the main body of the people in those countries, in a series of letters, addressed to all sensible and just Englishmen; in 2 vols. (The second volume contains a list of the abbeys, priories, nunneries, hospitals, and other religious foundations in England and Wales, and in Ireland, confiscated, seized on, or alienated, by the " Protestant Reformation," sovereigns, and parlia- ments.) 2 vols. 18mo. bound in one. $1. COBBETT'S THIRTEEN SERMONS, on, 1. Hy- pocrisy and Cruelty. 2. Drunkenness. 3. Bribery. 4. The Rights of the Poor. 5. Unjust Judges. 6. The Slug- gard. 7. Murder. 8. Gambling. 9. Public Robbery. 10. The Unnatural Mother. 11. Forbidding Marriage. 12. Parsons and Tythes. 13. Good Friday. To which is added, an Address to the Working Class on the New Dead Body Bill. 18mo. 50 cents. COBBETT'S PAPER AGAINST GOLD ; or the His- tory and Mystery of the Bank of England, of the debt of the stocks, of the sinking fund, and of all the other tricks and contrivances, carried on by means of paper money. 18mo. 75 cents. COBBETT'S TRIAL. A FULL AND ACCURATE REPORT OF THE TRIAL OF WILLIAM COB- BETT, M. P., before Lord Tenterden, and a Special Ju- ry, in the Court of King's Bench, London. 8 vo. 25 cents. COBBETT'S LEGACY TO THE PARSONS, in Six Letters, addressed to the Church Parsons, in ge- neral, including the Cathedral and College Clergy, and the Bishops, with a Dedication to Dr. Bloomfield, Bishop of London : To which is added his LEGACY TO LA- BOURERS ; or, What is the Right which the Lords, Baronets, and Squires, have to the Lands of England 1 In Six Letters, addressed to the Working People of England, with a Dedication to Sir Robert Peel. 18mo. 50 cents. PAPER AGAINST GOLD , OR, THE HISTORY AND MYSTERY BANK OF ENGLAND, OP THE DEBT, OP THE STOCKS, OF THE SINKING FUND, AND OP ALL THE OTHER TRICKS AND CON- TRIVANCES, CARRIED ON BY THE MEANS OF PAPER MONEY. BY WILLIAM COBBETT, M. P. " In the course of this work, I have clearly expressed mj opinions as to the final fatal effect of the paper money : those opinions are in direct oppo- sition to those of the Ministers and the Parliament : TIME, the trier of all things, must now decide between us ; and, if I he wrong, 1 have, at least, taken effectual means to make my error as conspicuous and as notorious as possible ; while, on the other hand, if I he right, I have laid the sure founda- tion of~complete triumph over my haughty, supercilious, unjust, and insolent foes." PAPER AGAINST GOLD, CONCLUDING PARAGRAPH. NEW YORK : PUBLISHED BY JOHN DOYLE. 1846. A GENERAL DEDICATION TO THE DUKE OF WELLINGTON. MY LORD DUKE, You, who are now First Lord of the Treasury, ought to understand the principles relating to money, that great instrument in the carrying on of human affairs ; and, as it is my opinion, founded on various reasons, and particularly on that suggested by your recent speech on the Corn-Laws, that you do not un- derstand those principles, I present this book to you as a teacher in this branch of knowledge, now so necessary to enable you to form a correct estimate of the nature and magnitude of the difficulties, with which you find yoursen surrounded. In order to convince you that the book demands your attention, a bare statement of the followkig cir- cumstances, out of which it arose, ought to DC suffi- cient. For seven years previous to 1810, I had con- tended, and, indeed, I had been repeatedly proving, that the paper-money was depreciated, and that it must, in the end, produce a convulsion in the country, unless prevented by a diminution of the Debt, and a return to payments in gold, always considering the latter as impossible without the former. On ac- count of these opinions, I had to undergo the almost incessant abuse of the base press of London ; and, indeed, of the whole country ; and, which was a more serious matter, I had to undergo the conse- quences of the wrath of the people in power, inclu- ding that of the far greater part of the Members of the two Houses of Parliament. At last, however, a DEDICATION. portion of the Parliament came to make the assertion, that a depreciation in the value of the paper-money had actually taken place ; and, finally, a Committee of the people who had got into the Commons' House, was appointed to inquire into the matter. This Committee, which ought to have been called the Paper-Committee, was called the Bullion-Corn- jnittee, having for its Chairman one HORNER, a Scotch lawyer. After immense volumes of " evidence" ta- ken down and published at the public expense, this Committee reported to the House that the bank- notes were depreciated, and that, in order to prevent future fatal consequences, a law ought to be passed to compel the Bank to pay in gold at the end of two years from that time. The Ministry contend- ed, that the bank notes were not depreciated, and that the notes could, at any time, be paid in gold, but that, during war, the proposed measure was in- expedient. I contended, that both sides were totally ignorant on the subject ; and that the bank notes, without a great reduction of the interest of the debt, and of all other out-goings, never could be paid in gold, with- out plunging the country into ruin. To prove this opinion to be correct, and to show that I understood more of the matter than both sides of the House put together, I wrote and published this book, with an avowed intention, too, of having it to produce, when time should have verified its doctrines, and when the sufferings of the nation should have disposed it to listen to truth and reason. The time is come, the doctrines have been verified, the sufferings have taken place ; and, therefore, here is the book. The scoffings, the scornings, the abuse, the reviling, the horrible calumnies and the base per- secutions which this book and other efforts of a si- milar kind brought upon me, and the briefest notice of each instance of which would fill fifty volumes more bulky than this, are all amply avenged by the joy that I feel at that which / now behold, and which DEDICATION. 5 can no longer be hidden even from the blindest and most besotted of the people. These men in power, seldom behind-hand in the career of contumely, arrogance, and insolence, seem- ed to adopt it as a maxim, that their main business was to take care to do nothing that the nation should be able to trace to my advice, on which maxim they appear to have proceeded from that day to this. I, on my part, resolved to maintain the right of mind to a superiority over matter, have constantly been repeating my advice, and keeping the past as well as the present, steadily before the eyes of the nation ; and, thus has the struggle been continued for nearly twenty years. These men in power, the very proper and adequate representatives of an aristocracy, with some few exceptions, the most haughty, the most su- percilious, the most conceited, and, at the same time, the most empty and mean that the world ever saw, seemed to read and to study all that I wrote upon this subject, in order that they might be able to do precisely that which I recommended not to be done, and that they might shun, as a sailor does the rocks, every thing which I had advised them to do ; while I, in order to secure ample vengeance on them, took care to be incessantly recommending the only mea- sures that could save the country from ruin! This was an odd way of seeking revenge : and, whoever is convinced that this has really been the case, will look upon the present state of things as the natural and appropriate result. What are the deserts of these men, it is, or rather, it will be, for the nation to say ; but, nothing can be more notorious than the following facts : namely, that, in 1810, I proved to these men (in this work which I now present to you,) that, if they ever at- tempted to return to gold-payments without first re- ducing the interest of the Debt, they would ruin the country ; that, early in 1818, TIERNEY, a member of parliament, who has since been Master of the Mint, recommended to them a gradual return to gold-pay- 1* 6 DEDICATION. ments, without any reduction of the interest of the Debt ; that, in the fall of that same year, I, in a Letter to TIERNEY, warned them of the terrible danger of following TIERNEY'S advice, and, after proving to them how injurious that advice, if followed, must be to the country, besought them not to follow it ; that, this was quite enough to make them follow TIERNEY'S advice, which they did, immediately afterwards, in adopting the measure, called PEEL'S BILL ; that, as soon as that bill was passed, I besought them to re- duce the taxes so as to prevent the ruin that the bill must otherwise produce, and, at the same time, I as- sured them, that they should have leave to broil me on a gridiron if they (without a great reduction of taxes) ever carried Peel's Bill into full effect ; that, here again was quite enough to make them persevere in the bill, which they did, adding to the taxes, at the same time, instead of reducing them, until, in July, 1822, the country was on the eve of absolute convulsion ; that then they gave way, partly repeal- ed Peel's Bill, but, in opposition to my advice, re- fused to listen to the prayer of the KENTISH PETITION, filled the country with paper-money, and, which ought never to be forgotten, boasted, almost in so many words, that their wise parliament had proved my predictions to be false ; that I instantly answered this boast by foretelling that their country-banks would soon blow up, and that they themselves, if they did not take care, would be blown to the devil ; that they laughed at my prediction, but that, in fifteen months from the date of that prediction, panic seized the system, the banks blew up, and these men them- selves confessed that they had brought us to within forty-eight hours of barter; that this was pretty good revenge on these presumptuous, contumelious, arrogant, and insolent men, and by no means a too heavy punishment for a people, the then greater part of the rich amongst whom had, whether by words, deeds, or wishes, sided with these empty and insolent men against me; that in their fright of 1826, they DEDICATION. 7 passed the present law, which, on the 5th of next April, (1829,) puts an end to all notes under five pounds, and that they, at the same time, declared they would not reduce the interest of the Debt, and that they would keep up a thundering standing army in time of peace ; that I, while they were passing this bill, humbly presented a petition, imploring them not to think of enforcing this new law without taking off one half of the taxes ; for that, if they did, the most dreadful public calamities would ensue ; that, of course, this was again enough, the law appears to be intended to be enforced, the taxes have not been reduced, and the calamities are come and are coming in numbers, in magnitude, and in form that seem to astound all beholders. It has been sometimes asked why these men in power, and in Parliament too, (for, with very few ex- ceptions, all have acted alike in this respect,) should have this anxious, and, apparently, unnatural desire to do nothing that might redound to my credit, even though for their own evident ease and advantage ; and this is a question by no means impertinent, es- pecially as we see them frequently enough acknow- ledging in the most candid manner, their great obli- gations to other writers; see their frequent practice of bestowing rewards and what they call honours on such writers ; nay, have seen them, in some cases, admit them to a participation in power. The an- swer to this question is this : that they never thus acted towards any man who did not approach them as an underling and a tool, who was not mean enough to abandon the assertion of his own superi- ority over them, who was not so base as always to speak of himself as inferior to men whom he knew to be poor creatures compared with himself. When they have found, as they sometimes have, men of great talent unable thus to bend to baseness, they have used towards them all the arts of destroying, in which, sooner or later, they have generally suc- ceeded. Unable to make me bend, they have used 8 DEDICATION. all these arts towards me ; but they have in this case, used them in vain ; and, in every instance, it has, un- luckily for them, happened, that I put myself openly at issue with them upon one great and all-important question, a question which involved national salva- tion or national ruin, and which question a reasonable time was sure to determine. That the facts stated in the last paragraph but one, are truths, is asserted, not by me only, but by hun- dreds of thousands of men ; and, indeed, they are as well known as it is known that this country is called England. Here we are, then, now waiting to see whether you will follow the example of your half- score of predecessors ; whether, to all my former triumphs, I be to add a triumph over you. I tell you distinctly, that you cannot carry the present law into effect without a great reduction of taxes, or, without plunging the country into a state of almost imme- diate commotion; I tell you, that you, without such reduction, or without a commotion a little more dis- tant, or without Bank-restriction, cannot repeal the present law ; I tell you, that you cannot make a Bank- restriction (without such reduction,) without causing a commotion not much more distant ; and, finally, I tell you, that there is no remedy, no means of pre- venting a final and terrible commotion, except that remedy which is stated and prayed for in the petitions of the sensible and spirited Counties of KENT and of NORFOLK, of the last of which petitions (which is more ample than the former) I, for my part, will never give up one single point. So that, unless you act upon my advice, and I have no reason to think you will, here I am at issue with YOU ; and, please to observe, that the trial is going on, time must speedily give its verdict, and that ver- dict will infallibly be in my favour. LORD GREN- VILLE has put forth a pamphlet, in order to show, that a sinking fund is useless ! He has made this dis- covery rather late I I have shown this famous " statesman" up j but, you ought to know, that the DEDICATION. 9 uselessness of such a "/wnd" is PROVED in this work, proved beyond all contradiction, and in a man- ner so clear, that no man but a stark fool, could, if he read the book, fail to be convinced, eighteen years ago, of the uselessness of the thing called the Sink- ing- Fund. Notwithstanding this, the false and coolly impudent Scotch felosofers pretend, that the disco- very was made, about eight years ago, by a " DOCTOR HAMILTON j" and, a brother " Doctor" of his, in Lon- don, observed in print, about four years ago, that it was " very odd, that no one ever even suspected the inefficacy of the Sinking Fund, until Doctor Hamil- ton wrote on the subject /" False loons ! Mr. PAINE said, forty years ago, that it was like a man with a wooden leg running after a hare : I proved the inefficacy in 1803 ; but, in this work, eighteen years ago, the proof was made demonstration. This is on the part of the Scotch, just such another trick as they attempted to play in the case of the " IN- VINCIBLE STANDARD," which they claimed the honour of having taken, but which I proved to have been taken by a FRENCHMAN ! To conclude, I do my duty in here tendering you a book that will, if you will attend to it, teach you what to do ; and, if you reject its teachings, this De- dication will always be at hand to be produced, when the consequences of such rejection shall have led to the dreadful, but perfectly natural, catastrophe. Re- member, that, during all the years of this struggle between me and the men in power, my candle has not been kept under a bushel (whether Winchester or " Imperial ;") for that, besides my weekly ad- monitions, more, perhaps, than a hundred thousand copies of this one book have been printed and sold ; so that we exhibit to the world this singular specta- cle : a common people thoroughly enlightened by their reading : and an aristocracy, a legislature and a ministry resolved not to read, or, to read for no other purpose than that of ascertaining how to shun the light emanating from my pen. Time and Truth 10 DEDICATION. have, however, no respect to persons ; their deci- sion will be impartial, and that decision is looked forward to not only with perfect confidence, but with the most cordial delight, by WM. COBBETT. COBBETT'S PAPER AGAINST GOLD : CONTAINING THE HISTORY AND MYSTERY OF THE BANK OF ENGLAND, THE FUNDS, THE DEBT, THE SINKING FUND, THE BANK STOPPAGE, THE LOW- ERING AND THE RAISING OF THE VALUE OF ?APER- MONEY ; AND SHOWING, THAT TAXATION, PAUPER- ISM, POVERTY, MISERY, AND CRIMES HAVE ALL INCREASED, AND EVER MUST INCREASE, WITH A FUNDING SYSTEM. INTRODUCTION. Botley, 8th February, 1817. THE time is now come, when every man in this kingdom ought to make himself, if possible, well ac- quainted with all matters belonging to the Paper- Money System. It is that System, which has mainly contributed towards our present miseries ; and, in- deed, without that System those miseries never could have existed in any thing approaching towards their present degree. In all countries, where a Paper- Money, that is to say, a paper which could not, at any moment, be converted into Gold and Silver, has ever existed ; in all countries, where this has been the case, the consequence, first or last, has always been great and general misery, and, in most such cases, such misery has been productive of that con- fusion and bloodshed, which I most anxiously hope will be prevented, in this instance, by timely mea- sures of a just and conciliatory character, and by the good sense, patience, and fortitude of the people. 12 INTRODUCTION. To be able clearly to trace our miseries to this grand cause, the Bank and the Paper-Money, it is necessary, that we inquire into the origin of money, how it acts upon the affairs of men, how prices de- pend upon its quantity, and how money itself is changed in its quantity and value. Next it is neces- sary, that we come at a clear idea of the origin of Paper-Money and of its introduction into this coun- try. Next, we ought to see the origin of the Bank and its Paper ; to see how Loans have been made, and how, and by what means, a Debt has been created. This compels us to go back and trace mi- nutely the Bank and the Debt" from their fatal birth to the present time ; to show how they arose both together, and how they have gone swelling moun- tains high, side by side, while taxes, pauperism, misery, and crimes, have all gone on increasing in the same degree. We ought next to inquire whether it be possible to lessen the Debt by that scheme, which has been called the Sinking Fund. Then we ought to enter into all the facts of that curious event, called the Bank-Restriction, which was a Stoppage of Cash-Payments at the Bank, in viola- tion of the Bank Charter and of the laws of debtor and creditor. This transaction ought now to be clearly understood by every man in England. All the actors in the transaction ought to be put forth in their true character ; for it is to this transaction, that we may trace more immediately all those sudden changes in the currency, which have ruined the far- mers, the tradesmen, the land-owners, and which have reduced the journeyman and labourers to such intolerable misery as that which they now endure, and which never was endured in England at any former period. To enable every man, and especially the youth, of this country, to come at a competent knowledge on all these topics, was the original object of this work, and is now the object of its republication. It consists of a Series of Letters, addressed to the INTRODUCTION. 13 People of Salisbury, in the years 1810 and 1811 ; because, at that time, those people were suffering se- verely from the failure of Country Banks. At the same time, there was a proposition before Parliament for making the Bank pay in Gold and Silver at the end of two years. This was proposed by the Oppo- sition ; but the Ministers said, that though the Bank was able to pay, it would not be wise to make it pay, till peace came. I contended, that, for the Bank to pay in gold and silver was impossible, without wi- ping away a part of the Debt ; or without plung- ing the country into ruin and misery. The Bank does not pay ; and, by only making one step towards it, the whole nation, all but fund-holders and tax- eaters, have already been ruined. In the writing of this work the greatest pains were taken to make my statements and my arguments, not only as clear and as strong, but also, as familiar as possible, and, by these means, to render a subject, which has always been considered as intricate and abstruse, so simple as to be understood by every reader of common capacity ; and, in this object, I hope I have succeeded, because I have had the satisfaction to witness numerous instances, where persons, who would generally be denominated illiterate, have, by the reading of this work, become completely masters of the whole subject. The truth is, however, that the pride of those, who call themselves learned men, lead them to misjudge greatly as to the capacity of those, whom they call the illiterate, or unlearned. To arrange words into sentences in a grammatical manner, to arrive at cor- rect results by the operations of figures, require a knowledge of rules, which knowledge must be ac- quired by art ; but the capacity of receiving plain facts and of reasoning upon those facts has its na- tural place in every sound mind ; and, perhaps, the mind the most likely speedily to receive and deeply to imbibe a fair impression is precisely that mind which has never been pre-occupied by the impressions 2 14 INTRODUCTION. of art or of school-education. And, if there be men to hold the doctrine, that the people in general ought not to understand any thing of these matters, such men can proceed upon no principle other than this, that popular ignorance is the best security for public plunderers and oppressors. It will be seen, that the Letters, composing the greater part of this work, were written in, and dated from, the " State Prison, Newgate" For six years before the date of these Letters, I had been endea- vouring to rouse my country to a sense of its danger from the Debt and Paper-money, and had often fore- told, that national ruin and misery would be the re- sult. But, it was while I was shut up in Newgate, that I made my greatest eifort. The cause of my imprisonment, and of the other heavy punishments inflicted on me, is pretty well known ; but, as this work is chiefly intended for the use of schools and of young persons in general, and, as I hope it may be read many years after its author will have closed his eyes for ever, it is no more than justice to myself and to a family of children, to whom their father's character will always be as dear as their own lives, for me to make here, and to send forth, inseparable from this work, the following concise and undenia- ble record of facts, which record was published im- mediately after the expiration of my imprisonment, in the month of July J812. ENGLISH LIBERTY OF THE PRESS, As illustrated in the Prosecution and Punishment of WILLIAM COBBETT. In order that my countrymen and that the world may not be deceived, duped, and cheated upon this subject, I, WILLIAM COBBETT, of Botley, in Hampshire, put upon record the following facts ; to wit : That, on the 24th of June, 1809, the following INTRODUCTION. 15 article was published in a London newspaper, called the COURIER: "The Mutiny amongst the LOCAL MILITIA, which broke out at Ely, was fortunately suppressed on Wednesday, by the arrival of four squadrons of the GERMAN LEGION CAVALRY from Bury, under the command of General Auck- land. Five of the ringleaders were tried by a Court- Martial, and sentenced to receive 500 lashes each, part of which punishment they received on Wednes- day, and a part was remitted. A stoppage for their knapsacks was the ground of the complaint that ex- cited this mutinous spirit, which occasioned the men to surround their officers, and demand what they deemed their arrears. The first division of the Ger- man Legion halted yesterday at Newmarket on their return to Bury." That, on the 1st of July, 1309, I published, in the Political Register, an article cen- suring, in the strongest terms, these proceedings ; that, for so doing, the Attorney General prosecuted, as seditious libellers, and by Ex-Officio Information, me, and also my printer, my publisher, and one of the principal retailers of the Political Register; that I was brought to trial on the 15th June, 1810, and was, by a Special Jury, that is to say, by 12 men out of 48 appointed by the Master of the Crown Office, found guilty ; that, on the 20th of the same month, I was compelled to give bail for my appearance to re- ceive judgment ; and that, as I came up from Botley (to which place I had returned to my family and my farm on the evening of the 15th,) a Tipstaff went down from London in order to seize me, personally ; that, on the 9th of July, 1810, I, together with my printer, publisher, and the newsman, were brought into the Court of King's Bench to receive judgment ; that -the three former were sentenced to be impri- soned for some months in the King's Bench prison ; that I was sentenced to be imprisoned for two years in Newgate, the great receptacle for malefactors, and the front of which is the scene of numerous hangings in the course of every year; that the part of the prison 16 INTRODUCTION. in which I was sentenced to be confined is sometimes inhabited by felons, that felons were actually in it at the time I entered it ; that one man was taken out of it to be transported in about 48 hours after I was put into the same yard with him ; and that it is the place of confinement for men guilty of unnatural crimes, of whom there are four in it at this time ; that, be- sides this imprisonment, I was sentenced to pay a thousand pounds ($4,800) TO THE KING, and to give security for my good behaviour for seven years, myself in the sum of 3,000 pounds, and two sureties in the sum of 1,000 pounds each ; that the whole of this sentence has been executed upon me, that I have been imprisoned the two years, have paid the thou- sand pounds TO THE KING, and have given the bail, Timothy Brown and Peter Walker, Esqrs. being my sureties ; that the Attorney General was Sir Vicary Gibbs, the Judge who sat at the trial, Lord Ellenborough, the four Judges who sat at passing sentence, Eilenborough, Grose, Le Blanc, and Bai- ley ; and that the jurors were, Thomas Rhodes of Hampstead Road, John Davis of Southampton-place, James Ellis of Tottenham Court Road, John Richards of Bayswater, Thomas Marsham of Baker Street, Robert Heathcote of High Street, Marylebone ; John Maud of York-place, Marylebone ; George Baxter of Church Terrace, Pancras ; Thomas Taylor of Red Lion Square ; David Deane of St. John Street ; Wil- liam Palmer of Upper Street, Islington ; Henry Favre of Pall-Mall ; and that the Prime Ministers during the time were Spencer Perceval, until he was shot by John Bellingham, and after that Robert B. Jenkinson, Earl of Liverpool ; that the prosecution and sentence took place in the reign of King George the Third, and that, he having become insane during my im- prisonment, the 1,000 pounds was paid 10 his son, the Prince Regent, in his behalf; that, during my imprisonment, I wrote and published 364 Essays and Letters upon political subjects ; that, during the same time I was visited by persons from 197 cities and INTRODUCTION. 17 towns, many of them as a sort of deputies from So- cieties or Clubs ; that, at the expiration of my impri- sonment, on the 9th of July, 1812, a great dinner was given in London for the purpose of receiving me ; that dinners and other parties were held on the same occasion in many other places in England ; that, on my way home, I was received at Alton, the first town in Hampshire, with the ringing of the Church bells ; that a respectable company met me and gave me a dinner at Winchester ; that I was drawn from more than the distance of a mile into Botley by the people ; that, upon my arrival in the village, 1 found all the people assembled to receive me ; that I concluded the day by explaining to them the cause of my imprisonment, and by giving them clear notions respecting the flogging of the Local Mi- litia-men at Ely, and respecting the employment of German Troops ; and, finally, which is more than a compensation for my losses and all my sufferings, I am in perfect health and strength, and, though I must, for the sake of six children, feel the diminution that has been made in my property (thinking it right in me to decline the offer of a subscription,) I have the consolation to see growing up three sons, upon whose hearts, I trust, all these facts will be engraven. WM. COBBETT. Botley, July 23, 1812. At the end of 16 years of experience, I find not a word to alter. WM. COBBETT. Barn-Elm Farm, Surrey, February 20, 1828. PAPER AGAINST GOLD, LETTER I. Appointment of the Bullion Committee Main points of tho Report Proposition for the Bank to pay in two Years To merit the appellation of a Thinking People, we must show that our Thinking produces Knowledge Go hack into the History of Paper- Money Definition of Money Increase of Paper What is the cause of this Increase? Origin of the Bank of England How it came to pass that so much Pa- per Money got afloat Increase of Bank Notes wanted to pay the increase of the interest on the National Debt Pro- gress in issuing Bank Notes from 20 to I pounds Suspicion awakened in 1797, which produced the Stoppage of Gold and Silver Payments at the Bank of England. GENTLEMEN, DURING the last session of Parliament, a Commit- tee, that is to say, ten or twelve members of the House of Commons, were appointed to inquire into the cause of the high price of Gold Bullion, that is, Gold not coined; and to take into consideration the state of the circulating medium, or money, of this country. This Committee have made a Report, as they call it; but, it is a great book, that they have written, and have had printed ; a book much larger than the whole of the New Testament. Of this Report I intend to enter into an Examination ; and, as you have recently felt, and are still feeling, some of the effects of Paper-Money, I think it may not be amiss, if, upon this occasion, I address myself to you. I have introduced myself to you without anr ceremony ; but, before we part, we shall become well acquainted ; and, I make no doubt, that you will un- derstand the distinction between Paper-Money, and Gold-Money much too well for it to be in the power of any one ever again to deceive you ; which under- standing will, in the times now fast approaching, be of great utility to all those amongst you, who may 20 PAPER AGAINST GOLD. have the means of laying up money, however small the quantity may be. The Committee above-mentioned, which, for bre- vity's sake, I call the Bullion Committee, sent for several persons, whom they examined as witnesses, touching the matter in question. There was Sir FRANCIS BARING, for instance, the great loan-maker, and GOLDSMIDT, the rich Jew, whose name you so often see in the newspapers, where he is stated to give grand dinners to princes and great men. The Evidence of these, and other money-dealers and merchants, the Bullion Committee have had printed; and, upon this evidence, as well as upon the Report itself, we shall have to make some remarks. The result of the Committee's inquiries is, in sub- stance, this; that the high price of gold is occasion- ed by the low value of the paper-money; that the low value of the paper-money has been occasioned (as you know the low value of apples is) by the great abundance of it; that the only way to lower the price of the gold is to raise the value of the paper-mo- ney, and that the only way to raise the value of the paper-money is to make the quantity of it less than it now is. Thus far, as you will clearly see, there was no conjuration required. The fact is, that, not only do these propositions contain well-known, and almost self-evident truths; but, these truths have, during the last two or three years, and especially during the last year, been so frequently stated in print, that it was next to impossible that any person in England, able to read, should have been unacquainted with them. But, having arrived at the conclusion, that, in order to raise the value of the paper-money, its quantity must be lessened; having come to this point, the rest of the way was more difficult ; for, the next object was, to point out the means of lessening the quantity of the paper-money, and this is an ob- ject, which, in my opinion, will never be effected, unless those means include the destruction of the whole mass. Not so, however, think the Gentlemen of the Bui- PAPER AGAINST GOLD. 21 lion Committee. They think, or at least, they evi- dently wish to make others think, that it is possible to lessen the quantity of the paper-money, and to cause guineas to come back again and to pass from hand to hand as in former times ; they would fain have us believe, that this can be done without the total destruction of the paper-money ; and, indeed, they have actually recommended to the House of Commons to pass a Law to cause the Bank in Thread- needle Street, London, commonly called the Bank of England, to pay its notes in real money, at the END OF TWO YEARS from this time, two years is a pretty good lease for people to have of this sort. This Bank promises to pay on demand. It doe* this upon the face of every one of its notes ; and, therefore, as a remedy for the evil of want of gold, to propose, that this Bank should begin to pay in two years' time, is something, which I think, would not have been offered to the public in any age but this, and, even in this age. to any public except the public in this country. The notes of the Bank of England bear, upon the face of them, a promise that the Bankers, or Bank company, who issue the notes, will pay the notes upon demand. Now what do we mean by paying a note? Certainly we do not mean, the giving of one note for another note. Yet, this is the sort of payment, that people get at the Bank of England ; and this sort of payment the Bullion Committee does not purpose oven to begin to put an end to in less than two years from this time. Gentlemen ; we, the people of this country, have been persuaded to believe many things. We have been persuaded to believe ourselves to be " the most thinking people in Europe ;" but to what purpose do men fhink, unless they arrive at useful knowledge by thinking? To what purpose do men think, if they are, after all their thinking, to be persuaded, that a Bank, which has not paid its promissory note* in gold for thirteen years and a half, will be able to pay them in gold at the end of fifteen years and a half, the quantity of the notes having gone on re- 22 PAPER AGAINST GOLD. gularly increasing' ? If men are to be persuaded to believe this, to what purpose do they think ? But, before I proceed any further in my remarks upon the Report of the Bullion Committee ; before I proceed to lay before you the exposures now made by the labours of this Committee ; the facts now become evident through this channel ; the confessions now made by these members of the House of Commons : before I proceed to lay these before you, and to re- mark upon the remedies proposed by the Committee, it will be necessary for me to go back into the his- tory of the paper-money; because, without doing this, I shall t>e talking to you of things, of which you will have no clear notion, and the reasonings, relating to which, you will, of course, not at all un- derstand. It is a great misfortune, that any portion of your time should be spent in reading or thinking about matters of this kind ; but, such is our present situation in this country, that every man who has a family to preserve from want, ought to endeavour to make himself acquainted with the nature, and with the probable consequences, of the paper-money now afloat. Money, is the representative, or the token of pro- perty, or things of value. The money, while used as money, is of no other use ; and, therefore, a bit of lead or of wood or of leather, would be as good as gold or silver, to be used as money. But, if these materials, which are every where found in such abundance, were to be used as money, there would be so much money made that there would be no end to it ; and, besides, the money made in one country would, however there enforced by law, have no va- lue in any other country. For these reasons Gold and Silver, which are amongst the most scarce of things, have been, by all the nations that we know any thing of, used as money. While the money of any country consists of no^ thing but these scarce metals ; while it consists of nothing but gold and silver, there is no fear of its becoming too abundant; but, if the money of a PAPER AGAINST GOLD. 23 country be made of lead, tin, wood, leather, or paper ; and if any one can make it, who rnay choose to make it, there needs no extraordinary wisdom to foresee, that there will be a great abundance of this sort of money, and thai the gold and silver money, being, in fact, no longer of any use in such a state of things, will go, either into the hoards of the prudent, or into the bags of those, who have the means of sending or carrying them to those foreign countries where they are wanted, and where they will bring their value. That a state of things like that here spoken of, does now exist in this country, is notorious to all the world. But, while we are all acquainted with the fact, and while many of us are most sensibly feeling the effects, scarcely a man amongst us takes the trouble to in- quire into the cause : yet, unless the cause be ascer- tained, how are we to apply, or to judge of a remedy ? We see the country abounding with paper-money ; we see every man's hand full of it ; we frequently talk of it as a strange thing, and a great evil ; but never do we inquire into the cause of it. There are few of you who cannot remember the time, when there was scarcely ever seen a bank note among Tradesmen and Farmers. I can remember when this was the case ; and, when the farmers in my country hardly ever saw a bank note, except when they sold their hops at Weyhill fair. People, in those days, used to carry little bags to put their money in, instead of the paste-board or leather cases that they now carry. If you look back, and take a little time to think, you will trace the gradual increase of paper-money, and the like decrease of gold and silver money. At first there were no bank-notes un- der 20 -pounds; next they came to 15 pounds; next to 10 pounds : at the beginning of the last war, they came to 5 pounds ; and, before the end of it, they came down to 2 and to 1 pounds. How long it will be before they come down to parts of a pound, it would, perhaps, be difficult to say ; but in Kent, at least, there are country notes in circulation to an 24 PAPER AGAINST GOLD. amount so low as that of seven shillings. It is the cause of this that is interesting to us ; the cause of this change in our money, and, in the prices of goods of all sorts and of labour. All of you who are forty years of age can remember when the price of the gallon loaf used to be about ten pence or a shilling, instead of two shillings and sixpence or two shillings and ten pence, as it now is. These effects strike you. You talk of them every day ; but the cause of them you seldom, if ever, either talk or think of: and it is to this cause that I am now endeavouring to draw your attention. You have, during the last seventeen years, seen the quantity of paper-money rapidly increase ; or in other words, you have, day after day, seen less and less of gold and silver appear in payments, and, of course more and more of paper-money. But, it was not till the year 1797, thai the paper-money began to increase so very fast. It was then that the two and one pound notes were first made by the Bank of England. It was then, in short, that paper-money became completely predominant. But, you will na- turally ask me, " What was the cause of that ? n The cause was, that the Bank of England stopped paying its notes in gold and silver. What 1 stop paying its notes ? Refuse to pay its promissory notes? The Bank of England, when its notes were presented, refuse to pay them? Yes: and, what is more, an Act of Parliament brought in by Pitt, was passed, to protect the Bank of England against the legal consequences of such refusal. So that, the people, who held promissory notes of the Bank, and who had, perhaps, given gold or silver for them, when they went to the Bank for payment, were told, that they could have no gold or silver, but that they might have other notes, more paper, if they pleased, in exchange for the paper they held in their hands Hnd tendered for payment. From that time to this, the Act of Parliament, authorizing the Bank of Eng- land to refuse to pay its notes in gold and silver, kas been in force. At first it was passed for three PAPER AGAINST GOLD. 25 months; next, till the Parliament should meet again ; then it was to last to the end of the war; then, when peace came, it was continued just for a year, till things should be settled ; then, as things were not quite settled, it was continued till Parliament should meet again ; and, as this present war had begun by that time, the Act was made to continue till six months after the next peace. The reasons given upon the different occasions, it will be very material to notice : for, it is this stop- page in the payment of gold and silver at the Bank of England upon which the whole question turns. Every thing hangs upon this, and, when we come to examine that part of the Report which treats of the Bank's reviving its payments in gold and silver, we shall find it of great use to us to recur to the reasons, the divers, the manifold reasons that were given, at different times, for suspending those payments. Since that suspension took place you have seen the gold and silver disappear; you have seen, the paper has supplied the place of gold; paper-money makers have set up all over the kingdom; and might not this well happen, when, to pay paper-money nothing more than paper-money was required ? But the rea- sons given for this measure of suspension ; the rea- sons given for the passing of an Act of Parliament to protect the Bank of England against the demands of its creditors are seldom recurred to, though, as you will presently see, without recurring to those reasons, and without ascertaining the true cause of the pass- ing of that Act of Parliament, we cannot form so good a judgment relative to the remedy now propo- sed ; namely, that of the Bank of England's revi- ving its payments in gold and silver. This is the remndy, which the Bullion Committee propose ; and, you will say, a very good remedy it is ; a very good remedy, indeed ; for people who have, for so long a time, not paid their notes in gold and silver, to begin to pay their notes in gold and silver, is a very good remedy ; but, the thing to ascertain, is, can the reme- dy be applied ? This is the question for us to discuss. 3 26 PAPER AGAINST GOLD. It required nobody to tell us, that paying in gold and giloer would be an effectual remedy for the evils ari- sing from not paying in gold and silver; but, it re- quired much more than I have yet heard to convince me, that to pay again in gold and silver was possible. The chief object of our inquiries being this : Whe- ther it be possible, without a total destruction of the paper-money system, to restore gold and silver to circulation amongst us ; this being the chief ob- ject of our inquiries, we should first ascertain how the gold and silver was driven out of circulation, and had its place supplied by paper-money ; for, un- less we get at a clear view of this, it will be next to impossible for us to reason satisfactorily upon the means of bringing gold and silver back again into Circulation. Some people suppose, that paper always made a part of the currency, or common money, of England. They seem to regard the Bank of England as being as old as the Church of England, at least, and some of them appear to have full as much veneration for it. The truth is, however, that the Bank of England is a mere human institution, arising out of causes having nothing miraculous, or supernatural, about them ; and that both the institution and the agents who carry it on, are as mortal as any other thing and any ether men, in this or in any other country. THE BANK, as it is called, had its origin in the year 1694, that is, a hundred and sixteen years ago ; and it arose thus : the then King, WILLIAM III., who had come from Holland, had begun a war against France, and, wanting money to carry it on, an Act was passed (which Act was the 20th of the 5th year of his reign) to invite people to make voluntary advances to the Government of the sum of 1,500,000 pounds, and for securing the payment of the interest, and also for se- curing the re-payment of the principal, tajres were laid upon beer, ale, and other liquors. Upon condi- tion of 1,20(),000/. of this money being advanced, within a certain time, the subscribers to the loan PAPER AGAINST GOLD. 27 were to be incorporated ; and, as the money was ad- vanced in due time, the incorporation took place, and the lenders of the money were formed into a tra- ding Company, called, " THE GOVERNOR AND COM- PANY OF THE BANK OF ENGLAND." Out of this, and other sums borrowed by the Government in the way of mortgage upon the taxes, there grew up a thing called the Stocks, or the Funds (of which we will speak hereafter ;) but the Bank Company remained under its primitive name, and as the debt of the na- tion increased, this Company increased in riches and in consequence. Thus, you see, and it is well worthy of your at- tention, the Bank had its rise in war and taxation. But, we must reserve reflections of this sort for other occasions, and go on with our inquiries how gold and silver have been driven out of circulation in this country, or, in other words, how it came to pass that so much paper-money got afloat. The Act of Parliament, which I have just referred to, points out the manner in which the Bank Com- pany shall carry on their trade, and the articles in which they shall trade, allowing them, amongst other things, to trade in gold, silver, bills of exchange, and other things, under certain restrictions ; but, as to what are called bank-notes, the Company was not empowered to issue any such, in any other way, or upon any other footing, than merely as promissory notes, for the amount of which, in the coin of the country, they were liable to be sued and arrested. Having, however, a greater credit than any other in- dividuals, or company of individuals, the Bank Com- pany issued notes to a greater amount ; and, which was something new in England, they were made payable, not to any particular person, or his order ^ and not at any particular time ; but to the bearer, and on demand. These characteristics, which dis- tinguished the promissory notes of the Bank of Eng- land from all other promissory notes, gave the people greater confidence in them ; and, as the Bank Coin- 28 PAPER AGAINST GOLD. pany were always ready to pay the notes in Gold and Silver, when presented for payment, the notes be- came, in time, to be looked upon as being as good as gold and silver. Hence came our country sayings : " As good as the Bank ;" " As solid as the Bank ;" and the like. Yet, the Bank was, as we have seen, merely a company of mortal men, formed into an as- sociation of traders ; and their notes nothing more than written promises to pay the bearer so much money in gold or silver. We used to have other sayings about the Bank, such as " As rich as the Bank ;" " All the gold in the Bank ;" and such like, always conveying a no- tion, that the Bank was a place, and a place, too, where there were great heaps of money. As long as the Company were ready and willing to pay, and did actually pay, their notes in gold and silver, to all those persons who wished to have gold and silver, it is clear that these opinions of the people, relative to the Bank, were not altogether unfounded ; for, though no bit of paper, or of any thing which has no value in itself, can be, in fact, so good as a bit of gold : still, if it will, at any moment, whenever the holder pleases, bring him gold or silver to the amount writ- ten upon it, it is very nearly as good as gold and silver; and, at the time of which we are speak- ing, this was the case with the promissory notes of the Bank Company. But, it must be evident, thaJt, though the Company were ready, at the time now referred to, to pay their notes in gold and silver, they had never in their money-chests a suf- ficiency of gold and silver to pay off all their notes, if they had been presented all at once. This must be evident to every man ; because, if the Bank Company kept locked up as much gold and silver as their notes amounted to, they could get nothing by issuing their notes, and might full as well have sent out their gold and silver. A far- mer, for instance, who is generally using a hun- dred pounds of money to pay his workmen, might PAPER AGAINST GOLD. 29 Jend the hundred pounds and get interest for it, if he could persuade his workmen to take promissory notes of his own drawing, instead of money, and, if he were sure that these promissory notes would not be brought in for payment; but, if this was not the case, he would be compelled to keep the hundred pounds in his drawer ready to give to those who did not like to keep his promissory notes ; and, in such case, it is clear, that the money would be of no use to him, and that he might full as well have none of his notes out. Just so with the Bank Company, who, at no time, could have in hand gold and silver enough to pay off all their notes at once ; nor was this necessary as long as the people regarded those notes as being equally good with gold and silver. But, it is clear, that this opinion of the goodness of the Company's notes, or rather, the feeling of confidence, or, still more properly perhaps, the absence of all suspicion, with respect to them, must, in a great degree, de- pend upon the quantity of notes seen in circulation, compared with the quantity of gold and silver seen in circulation. At, first, the quantity of notes was very small indeed ; the increase of this quantity was, for the first twenty years, very slow ; and, though it became more rapid in the next twenty years, the quantity does not appear to have been large till the war which took place in 1755, before which time the Bank Company put out no notes under 20 pounds in amount. Then it was that they began to put out 15 pound notes, and afterwards, but during the same war, 10 pound notes. During all this time, loans, in every war, had been made by the Government. That is to say, the Government had borrowed money of individuals, in the same way as above-mentioned, in the year 1694. The money thus borrowed was never paid off, but was suffered to remain at in- terest, and was, as it is now called, the NATIONAL DEBT, the interest upon which is annually paid out of the taxes raised upon the people. As this debt went on increasing, the bank-notes went on in- 3* 30 PAPER AGAINST GOLD. creasing, as, indeed, it is evident they must, see- ing that the interest of the debt was, as it still is and must be, paid in bank-notes. Why not pay it in gold ? It is not simply the quantity of bank-notes that are put into circulation, which will excite alarm as to their solidity ; but, it is that quantity, if it be great, compared with the quantity of gold and silver, seen in circulation. If, as the bank-notes increased, the circulating gold and silver had increased in the same proportion ; then, indeed, bank-notes would still have retained their usual credit : people would still have had the same confidence in them. But, this could not be. From the nature of things it could not be. The cause of the increase of the bank-notes, was, the increase of the interest upon the National Debt ; and, as it grew out of an ope- ration occasioned by poverty, it would have been strange indeed had it been accompanied with a cir- cumstance, which would have been an infallible in- dication of riches. Without, however, stopping here to inquire into the cause of the coin's not increasing with the in- crease of paper, suffice it to say, that such was the fact. Year after year we saw more of bank-notes and less of gold and silver ; till, in time, such was the quantity of bank-notes required to meet the pur- poses of gold and silver in the payment of the inte- rest of the still-increasing debt, and in the payment of the taxes, that many other banks were opened, and they also issued their promissory notes. The Bank Company's notes, which had never before been made for less sums than 10 pounds, were, soon after the beginning of PITT'S war, in 1793, issued for five pounds, after which it was not to be supposed, that people could have the same opinion of bank-notes that they formerly had. Every part of the people, except the very poorest of them, now, occasionally, at least, possessed bank-notes. Rents, salaries, yearly wages, all sums above five pounds, were now paid in PAPER AGAINST GOLD. 31 bank-notes ; and, the Government itself was now paid its taxes in this same sort of currency. In such a state of things it was quite impossible that people should not begin to perceive, that gold and silver was better than bank-notes ; and that they should not be more desirous of possessing the former than the latter ; and, the moment this is the case, the banking system must begin to tremble ; for, as the notes are payable to the bearer, and payable on de- mand, it is very certain, that no man, with such a preference in his mind, will keep in his possession a bank-note, unless we can suppose a man so absurd as to keep a thing, of the goodness of which he has a suspicion, while, for merely opening his mouth or stretching forth his hand, he can exchange it for a thing of the same nominal value, and of the good- ness of which it is impossible for him or any one else to entertain any suspicion. " Public Credit," as it has been called, but, as it may more properly be called, " The credit of bank-notes" has been em- phatically denominated, " SUSPICION ASLEEP." In the midst of events like those of 1793 and the years immediately succeeding ; in the midst of circumstan- ces like those above-mentioned, relating to the bank- notes, it was impossible that SUSPICION should sleep any longer. The putting forth of the 5 pound bank- notes appears to have roused it, and, in the month of February, 1797, it became broad awake. The stop- page of payment on the part of the Bank Company was the immediate consequence ; but, a particular ac- count, of that important event, which totally changed the nature of all our money transactions, and which will, in the end, produce, in all human probability, effects of the most serious nature, must be the sub- ject of- a future Letter. In the mean while I am, Your Friend, WM. COBBETT. State Prison, Newgate, Thursday, 30th Aug. 1810. 32 PAPER AGAINST GOLD. LETTER II. What are the Funds and Stocks and National Debt? Ne- cessity of clearly understanding what these words mean Meaning of themInquiry into the Origin of the Funds and Debt The English Revolution Act of Parliament, 4th William III. Cap. 3, begins the Funding and Debt System First Loan to Government Nature of Funds and Stocks and National Debt Explanation of how " Money is put in the Funds" Illustration in the case of Messrs. Muckworm and Company, and that of Farmer Greenhorn The Funds shown to be NO PLACE, nor any thing of a mystical nature. GENTLEMEN, HAVING, in the foregoing letter, taken a sketch of the History of the Bank of England, and of its Notes, from their origin down to the time when that Bank stopped paying its notes in gold and silver , the next thing to do in our regular course of proceed- ing, will be to inquire into, and clearly ascertain, the cause of that stoppage ; for it is very evident, that without ascertaining this cause, we shall not be able to come to any thing like a decided opinion with regard to our main question namely, WHETHER THERE BE ANY PROBABILITY THAT THIS BANK WILL BE ABLE TO RETURN TO THEIR PAYMENTS IN GOLD AND SILVER, in which question every man of us, from the highest to the lowest, is so deeply interested. But, it is necessary for us to stop a little where we are, and not go on any further with our inquiries into the cause of the stoppage at the Bank of England, until we have taken time to look a little at the FUNDS and the NATIONAL DEBT. These are words which are frequently made use of; but, like many other words, they stand for things which are little understood, and the less, perhaps, because the words are so very commonly used. As in the in- stance of Shrove Tuesday or Shrovetide, words which we all, from the oldest to the youngest, make use of; but as to their meaning, we content our- selves with supposing, (or appearing to suppose,) that they contain a commandment for us to eat Frit- ters and Pancakes, and to murder poor unoffending PAPER AGAINST GOLD. 33 cocks ; whereas they mean, the Tuesday, or the time for going to confess our sins to, and to get abso- lution from the Priests ; to shrive, being a word equal in meaning to to confess, and shrove, to con- fessed ; and the use of them in the case here men- tioned having been handed down to us from the days of our forefathers when the Catholic worship was the worship of the country. Monstrous, however, as is the perversion of the meaning of words, in this instance, it is scarcely more so than in the case of the Funds and the A"a- tional Debt; but, there is this very important dif- ference in the two cases ; that, while, in the former, the perversion is attended with no mischief either to individuals, or to the nation, in the latter, it is attended with great mischief to both ; with the ruin and mi- sery of many a thousand of widows and orphans, and with woes unnumbered to the nation at large. But, if a right understanding of the meaning of these words be, in all cases where words are used, of some consequence, it is of peculiar consequence here, where, as may have been gathered from the preceding letter, we shall find the Funds, the Stocks, and the Na- tional Debt, to be so closely interwoven with the Bank Notes, as to be quite inseparable therefrom in every possible state or stage of their existence. The word FUND means, a quantity of money put or collected together. The word STOCK, as applied to such matters, has the same meaning. Both words may admit of meanings somewhat dif- ferent from this ; but this is the meaning which plain men commonly give to these words ; and it is, too, the fair and sensible meaning of them. Now, we shall presenly see, in what degree this meaning be- longs to what are commonly called the Funds, or the Stocks, into the origin and progress of which, we are now going to inquire ; and, an inquiry it is, worthy of the undivided attention of every true Englishman ; every man who wishes to see the country of his fore- fathers preserved from ruin and subjugation. &4 PAPER AGAINST GOLD. Soon after the ENGLISH REVOLUTION ; that is to say, soon after our ancestors had driven away King James the Second, and had brought over the Prince of Orange and made him king in his stead, and had, at the same time, taken measures for stripping the family of Stuart of the crown for ever, and putting it upon the heads of His present Majesty's family ; soon after this Revolution, the existence of Funds, Stocks, and a National Deht began, under the auspi- ces of that same Prince of Orange, who was then become our King William III., and who appears to have lost but very little time in discovering the effect- ual way of obtaining money from the English, with- out resorting, as the Stuarts had, to those means, the use of which had, ever and anon, excited commo- tions against them ; which had brought one of them to the scaffold ; and which, at last, after driving another from the land, had for ever stripped them of their crown. The real motives for creating a National Debt we shall, by-and-by, perhaps, have occasion to notice ; but, at present, our business is to get at a clear notion of the way in which it was created. William the Third was hardly seated upon the throne before a war was begun against France, and, in the 4th year of his reign, being the year 1692, an Act of Parliament was passed imposing " Certain rates and duties upon beer, ale, and other liquors, for securing certain Recompenses and Advantages in the said Act mentioned, to such Persons as shall voluntarily advance the sum of Ten Hundred Thou- sand Pounds towards carrying on the War against France." This is the Title of the Act, being Chap ter 3d of the 4th year of William and Mary. These are the very words ; and fatal words they were to England. In the body of this Act it is enacted, that the per- sons, who shall advance the million of pounds, shall, out of the rates and duties imposed by the Act, re- ceive a certain inter est, or annual payment, for the PAPER AGAINST GOLD. 35 use of the money so advanced. They were to have, and they had, their money secured to them by way of annuity for life or lives ; and, they were to have certain advantages in cases of survivorship ; and the annuities were to be redeemed upon certain conditions and at certain times. But, it will be quite useless for us to load our subject with a multitude of words, and to ring the changes upon all the quaint terms, which, as appertaining to these matters, have, one would think, been made use of for no other pur- pose than that of confusing the understandings of plain men. The light wherein to view the transac- tion is this : The Government was (no matter how, or from what cause) got into a war with France ; and, for the alleged purpose of pushing on this Avar with u vigour" (it is odd enough that the very word was made use of, just as it is now) they borrowed a million of pounds of individuals, and, at the same time, imposed taxes upon the whole nation for the purpose of paying the interest of the money so bor- rowed ; or, in other words, the nat ; on's taxes were mortgaged to the lenders of this million of pounds. The lenders of the money, who, in time, became to be called fund holders or stock holders, did, as the work of lending and fund-making advanced, make their loans in various ways, and the bargains between them and the Government were of great variety in their terms, and in the denominations made use of; but, it was always the same thing in effect : the government borrowed the money of in- dividuals, it mortgaged taxes for the payment of the interest ; and those individuals received for their money, promises, or engagements, no matter in what shape, which enabled them to demand annually, half-yearly, or quarterly, the share of interest due to each of them ; and any single parcel of interest, so received, is what is, in the queer language of the funding trade, called a "dividend." No matter, however, what the thing is called ; no matter how many nick-names they choose to give to the several 36 PAPER AGAINST GOLD. branches of the Debt. We daily see, in the news- papers, what is called the " PRICE OF STOCKS," as in the following statement, which is in all the newspapers of this day : Bank Stock 257 5$ 3 per Cent. Red. 68 f f 3 per Cent. Con. 67f 8 7$ 4 per Cent. 85 4 5-J- 4 f 5 per Cent. Navy 99f \ -f Long Annuities 18^- Omnium 2 -f- -f- dis. Excheq. Bills 1 dis. 5 prem. Bank Stock for open 257 Consols for 68 i f These are names, which the dealers, or job- bers, in Stocks give to the several classes of them. But, as I said before, let us avoid confusing our heads with this worse than Babylonish collection of names, or sounds, and keep fully and clearly and constantly in our sight, these plain facts : FIRST, that the Funds, the Stocks, and the National Debt, all mean one and the same thing; SECONDLY, that this Debt is made up of the Principal money lent to the Go- vernment at different times since the beginning of the thing in 1692 ; THIRDLY, that the Interest upon this principal money is paid out of the taxes ; and, FOURTHLY, that those persons who are entitled to re- ceive this interest, are what we call fund-holders, or stock-holders, or, according to the more common notion and saying, have " money in the Funds" Being here in the elementary, the mere horn-book part of our subject, we cannot make the matter too clear to our comprehension ; and, we ought, by no means, to go a step further till we have inquired into the sense of this saying about people's "having money in the Funds /" from which any one, who did not understand the thing, would naturally con- clude, that the person who made use of the saying, looked upon the Funds, as a place, where a great quantity of gold and silver was kept locked up in safety. Nor, would such conclusion be vprv <>~r*- PAPER AGAINST GOLD. 37 neous ; for, generally speaking, the notion of the people of this country is, that the Funds or the Stocks (they are made use of indiscriminately) is a PLACE, where money is kept. A place, indeed, of a sort of mysterious existence ; a sort of financial Ark; a place not, perhaps, to be touched, 'or even seen ; but, still the notion is, that of a place, and a place, too, of more than mortal security. Alas ! the Funds are no place at all ! and, indeed, how should they, seeing that they are, in fact, one and the same thing with the National Debt? But, to remove, from the mind of every creature, all doubt upon this point ; to dissipate the mists in which we have so long been wandering, to the infinite amusement of those who invented these terms, let us take a plain common-sense view of one of these loaning transac- tions. Let us suppose, then, that the Government wants a loan, that is, wants to borrow money ', to the amount of a million of pounds. It gives out its wishes to this effect, and, after the usual ceremony upon such occasions, the loan is made, that is, the money is lent, by Messrs. Muckworm and Company. We shall see, by-and-by, when we come to talk more fully upon the subject of loans, what sort of a way it is, in which Muckworm pays in the money so lent, and in what sort of money it is that he pays. But, for the sake of simplicity in our illustration, we will suppose him to pay in real good money, and to pay the whole million himself at once. Well : what does Muckworm get in return ? Why, his name is written in a book ; against his name is written, that he is entitled to receive interest for a million of money; which book is kept at the Bank Com- pany's house, or shop, in Threadneedle Street, Lon- don. And, thus it is that Muckworm "puts a mil- lion of money into i the Funds? " " Well," you will say, " but what becomes of the money ?" Why, the Government expends it, to be sure : what should be- come of it ? Very few people borrow money for the purpose of locking it up in their drawers or chests. "What? then the money all vanishes; and w>- 4 38 PAPER AGAINST GOLD. thing remains in lieu of it but the lenders name written in a book?" Even so: and this, my good neighbours, is the way, that " money is put into the Funds." But, the most interesting part of the transaction remains to be described. Muckworm, who is as wise, as he is rich, takes special care not to be a fund-holder himself ; and, as is always the case, he loses no time in selling his stock, that is to say, his right to re- ceive the interest of the million of pounds. These Funds, or Stocks, as we have seen, have no bodily existence, either in the shape of money or of bonds or of certificates or of any thing else that can be seen or touched. They have a being merely in name. They mean, in fact, a right to receive interest; and, a man, who is said to possess, or to have a thousand pounds' worth of stock, possesses in reality, nothing but the right of receiving the inte- rest oja thousand pounds. When, therefore, Muck- worm sells his millions' worth of stock, he sells the right of receiving the interest upon the million of pounds which he lent to the Government. But, the way in which sales of this sort are effected is by par- celling the stock out to little purchasers, every one of whom buys as much as he likes ; he has his name written in the book for so much, instead of the name Muckworm and Company ; and, when Muckworm has sold the whole, his name is crossed out, and the names of the persons, to whom he has sold, remain in the book. And, here it is that the thing comes home to our very bosoms ; for, our neighbour, farmer Green- horn, who has all his life been working like a horse, in order to secure his children from the perils of po- verty, having first bequeathed his farm to his son, sells the rest of his property (amounting to a couple of thousands of pounds,) and, with the real good money, the fruit of his incessant toil and eare, pur- chases two thousand pounds' worth of Muckworm's Funds, or Stocks, and leaves the said purchase to PAPER AGAINST GOLD. 39 his daughter. And, why does he do so? The rea- son is, that, as he believes, his daughter will always receive the interest of the two thousand pounds, without any of the risk, or trouble, belonging to the rents of house or land. Thus neighbour Greenhorn is said to have u put two thousand pounds in the Funds ;" and thus his daughter (poor girl !) is said to " have, her money in the Funds /" when the plain fact is, that Muckworm's money has been spent by the Government, that Muckworm has now the two thousand pounds of poor Grizzle Greenhorn, and that she, in return for it, has her name written in a Book, at the Bank Company's house, in Thread- needle-street, London, in consequence of which she is entitled to receive the interest of the two thousand pounds ; which brings us back to the point whence we started, and explains the whole art and mystery of making loans and funds and stocks and national debts. It will be very useful to show the effect of this * putting money in the Funds," with respect to the party who is said to put it in. I do not know of any duty more pressing upon me, than that of showing, in this plain and practical way, what have been, what are, and what must be, the consequences to those, who thus dispose of their property ; especially if they have no property of any other sort. But, this will be found to belong to another part of our sub- ject ; and as we have now seen what the Funds and the Stocks really are ; as we have blown away the mist in which we had so long been wandering ; as the financial Ark is now no more in our sight than any veritable box made of deal boards and nails ; as we are now satisfied, that there is nothing mystical in the~words Funds and Stocks, and that, so far from meaning a place where a great quantity of money is kept, they are not the name of any place at all, nor of any thing which has a corporeal existence, and are the mere denominations, or names, of the several classes or parcels, of Debt, which the Go- 40 PAPER AGAINST GOLD. vernment owes to individuals : in short, as we have now, let us hope, arrived at a complete knowledge of the nature and origin of the Funds and the Stocks and the National Debt, which, as was before said, are, in fact, all one and the same thing, it is time that we proceed to inquire into their progress, and to see how that progress is connected with the in- crease of the Bank Notes and with the stoppage of the payment of those notes in gold and silver. To do justice, however, to this copious and interesting theme, especially when coupled with what it will be necessary to say as to the schemes for arresting the progress of the Debt, will demand a separate Letter. In the meanwhile, I am, with perfect sincerity, Your Friend, WM. COBBETT. State Prison, Newgate, Thursday, 6th Sept. 1810. LETTER III. Danger of exciting Popular Discontents against Country Paper-Money Makers Description of the National Debt- Progress of the Debt The different Denominations of it no Consequence Cost of the Anti-jacobin War Progress of the National Expenses Progress of the Revenue or Taxes The effect of Taxation Taxes cause Poverty and Mi- sery in a Country Not like Rents Increase of Revenue no Proof of National Prosperity What are the Signs of National Prosperity Increase of the Poor rates in England Cost of the Tax-Gatherers sufficient to support 92,500 Families. GENTLEMEN, A LONDON print, which is what is called a mi- nisterial newspaper, and which I, in the discharge of my duty as a public writer, am compelled to read, but which, for the sake of your morals, I hope none of you ever see, has most harshly spoken of that part of our paper-money, which is issued by the Bankers, whose shops are in the country. The writer of this print has described that paper, namely, the country PAPER AGAINST GOLD. 4i bank-notes, as " destructive assignats ;" and, in another of his publications, he calls them " vile rags ;" and then again " dirty rags." These hard words, besides that they are unbecoming in sober discussion, can do no good, and may do a great deal of harm, if they have any effect at all upon the minds of the people ; and, therefore, we will make a re- mark or two upon their tendency, before we proceed with the topic mentioned at the close of the last letter. Assignats was the name given to the French re- volutionary paper-money, the distresses occasioned by which are fresh in the recollection of most people ; and, to give the same name to our country bank-notes was , therefore, to proclaim, as far as this writer was able to proclaim, that these notes, being more than one half of all our circulating medium, were as bad, if not worse, than the paper-money of France, which produced so much individual misery to so many mil- lions of people. Not that this was betraying any secret to the world ; for, it is beyond all comprehen- sion foolish to suppose, that all the world, particu- larly our sharp-sighted enemy, are not fully ac- quainted with our situation in this respect, more es- pecially now that the Bullion Report is abroad ; but what I find fault of, is, that this description of coun- try hank-notes, as contradistinguished from the London bank-notes, has a tendency to excite popular hatred, and in cases that may happen, popular vio- lence, against that part of our paper-money makers, called country bankers ; than which nothing can be much more unjust in itself, or be more likely to lead to universal confusion, the experience of the world having proved that commotion, when once oil foot, is seldom limited to the accomplishment of its original object ; and, we may venture to affirm, that nothing was ever better calculated to render popular commotion violent, and to push it beyond its natural bounds, than the hatred and revenge, which it would seem to be the object of the print above-mentioned to excite in the minds of the people. 4* 42 PAPER AGAINST GOLD. The country paper-money makers are not, as we shall soon see, any more to blame than are the paper- money makers in town. Paper-money making is a trade, or calling, perfectly innocent in itself, and the tradesmen may be very moral and even very liberal men. Amongst them, as amongst men of other trades, there are, doubtless, sharpers and even rogues, and the trade itself may be one that exposes men to the temptation of becoming roguish ; but it does not follow, that all the paper-money makers, or that the paper-money makers in general, are men of dis- honest views. It is, therefore, not only illiberal, but unjust in the extreme, to condemn the whole of the trade in a lump, to call their wares " destructive assignats, vile rags, dirty rags" and the like, whence it is, of course, intended that it should be un- derstood, that all the issuers of them ought to be re- garded as pests of society and treated accordingly ; when, the truth is, as we shall presently see, the fault is not in individuals, but in the system. Having thus endeavoured to put you upon your guard against the tendency of this very unjust repre- sentation of our country bankers, and their money, an endeavour, which, it appeared to me, ought not to be delayed, we will now proceed with our subject, and, as was proposed, at the close of the last Letter, inquire into the progress of the Funds and Stocks ; or, in more proper terms, into the INCREASE OF THE NATIONAL DEBT. We have before seen what is the nature of this debt : we have also seen how it began : we shall, by- and-by, have to show the effects of it : but what we have to do, at present, is to inquire into and ascer- tain, how it has gone on increasing, and what is now its amount. We shall next inquire into, the schemes for lessening the Debt ; and then we shall distin- guish what is called Redeemed from Unredeemed debt ; but, first of all, let us leave all other views of it aside, and confine our attention merely to the sums borrowed. We have before seen, that the PAPER AGAINST GOLD. 43 money has been borrowed in various ways, or under various denominations. In some cases the money borrowed was to yield the lender 3 per centum, that is to say 3 pounds interest, yearly, for every hun- dred pounds of principal. In some cases the lender was to receive 4 per centum ; in some cases 5 per centum : and in some cases more. Hence come the denomination of 3 per cents, and 4 per cents., and so forth. But, to the people, who have to pay the interest, these distinctions are of no consequence at all, any more than it would be to either of us, whe- ther our bakers' bills were made out upon brown paper or upon white. We shall see afterwards what we have to pay yearly in the shape of interest^ which is the thing that touches us home ; but, let us first see what the principal is, and how it has gone on increasing ; bearing in mind, that, as was shown in the foregoing Letter page 36, the borrowing, and, of course the Debt, began in the year ] 692, in the reign of William the Third, and that the loan made in that year amounted to one million of pounds. When QJJEEN ANNE, who succeeded William, came to the throne, which was in the year 1701, the Debt was 16,394,702 When GEORGE I. came to the throne, in 1714, it was 54,145,363 When GEORGE II. came to the throne, in 1727, it was 52,092,235 When GEORGE III. came to the throne, in 1760, it was 146,682,844 After the AMERICAN WAR, in 1784, it was 257,213,043 At the latter END OF THE LAST WAR ; that- is to say, the first war against the French Revolutionists, and which, for the sake of having a dis- tinctive appellation, we will call the ANTI-JACOBIN WAR : at the end of that war, in 1801, the Debt was . . 579 931,447 44 PAPER AGAINST GOLD. At the PRESENT TIME \ oi rather in Ja- nuary last:* 811,898,082 That is to say, eight hundred and eleven millions y eight hundred and ninety eight thousand, and eighty-two ; and these in pounds, in English pounds, too ! There are in the accounts laid before the Par- liament (from which the last-mentioned sum is taken) some shillings and pence and even FARTHINGS, in addition ; but though these accountants have been so nice, we will not mind a few farthings. Part of this Debt is what is called funded and a part un- funded ; part is called Irish Debt, part Emperor of Germany's Debt, and another part the Prince Re- gent of Portugal's. But interest upon the whole of it is payable in England ; and that is all that we have to look after ; it being of no consequence to us what the thing is called, so that we have to pay for it. So that we are taxed to pay the interest of it, what matters it to us what names the several parts of it may go by ? I hope, that there is not, at this day, a man amongst you, who is to be amused with empty sounds : I hope that your minds are not, now- a-days, after all that you have seen, to be led away from the object before them by any repetition of mere names. So long as we are taxed to pay the interest upon the Debt, that man must be exceed- ingly weak, who is to be made to believe, that it is of any consequence to any of us by what name that debt is called.f Such, then, has been the progress of the National Debt ; and, it is well worthy of our attention, that it has increased in an increasing proportion. It is now nearly s?> times as great as it was when the present king [Geo. III.] came to the throne ; and, * The above enormous sums maybe converted into United States' money by reckoning 4s. 6d. to the dollar, and adding eight per cent, which is the common rate of exchange. This makes the pound sterling about $4 80. Thus as ll. ster- lingis $4 80: 811,898,032^. is $3,897,110,793,60. t There is, besides the above, the INDIA DEBT ; but of that we will speak another time. PAPER AGAINST GOLD. 45 which ought to he well attended to, more than two thirds of the whole of the debt has been contracted in carrying on, against the French, that war, which, at its commencement, was to succeed by means of ruining the Finances of France. When the ANTI- JACOBIN WAR began in 1793, the Debt was, at the utmost, 257,213,043. It is now 811,898,082. Such has, thus far, been the financial effect ; such has been the effect, as to money-matters, of the wars against the Jacobins. How many times were we told, that it required but one more campaign ; one more ; only one more vigorous campaign, to put an end to the war ; to destroy, to annihilate, for ever, the resources of France. Alas ! those resources have not been destroyed. They have increased in a fearful degree ; while we have accumulated hun- dreds of millions of Debt in the attempt. How many writers have flattered us, from time to time, with the hope, nay, the certainty, (if we would but persevere,) of triumphing over the French by the means of our riches ! To how many of these de- ceivers have we been so foolish as to listen ! It is this credulity which has led to the present state of things ; and, unless we shake it off at once, and re- solve to look our dangers in the face, we shall, I greatly fear, experience that fate which our deceivers told us would be experienced by our enemy. PITT, it is well known, grew into favour with the nation, in consequence of his promises and his plans to pay off the National Debt ; and, this same PITT, who found that Debt 257 millions, left it upwards of 600 millions, after having, for twenty years, had the full power of managing all the resources of the nation ; after having, for nearly the whole of that time, had the support of three fourths, if not more, of the Mem- bers of the House of Commons ; after having, of course, adopted whatever measures he thought pro- per, during the whole of that time. He found the Debt two hundred and fifty odd millions, and he left it six hundred and fifty odd. This was what 46 PAPER AGAINST GOLD. was done for England by that PITT whose own pri- vate debts the people had to pay, besides the expense of a monument to his memory ! This is what every man in England should bear constantly in mind. Having now seen how the National Debt has in- creased, let us next see how the EXPENSES of the Nation have increased ; and, then take a look at the increase of the TAXES ; for, in order to be able to form a correct opinion upon the main points, touched upon by the Bullion Committee, we must have a full view, not only of the Debt but of the Ex- penses and the Taxes of the nation. When Q,UEEN ANNE came to the throne, in 1701, the whole Ex- penses of the year, including the interest on the National Debt, amounted to ..... 5,610,987 Peace. When GEORGE I. came to the throne, in 1714, and just after Q,ueen Anne had been at war eleven years 6,633,581 Peace. When GEORGE II. came to the throne, in 1727 5,441,248 Peace. When GEORGE III. came to the throne, in 1760 24,456,940 War. After the END OF THE AMERICAN WAR, and at the beginning of PITT'S Administration, in 1784 21,657,609 Peace. At the latter End of the last, or ANTI-JACOBIN WAR, in 1801 . 61,278,018 War. For the last year, that is, the year 1809 82,027,288, 5s. 1-Jd. War. Now, without any thing more than this, let me ask any of you, to whom I address this Letter, whether you think it possible for the thing to go on in this way for any great length of time? If the subject did not present so many considerations to make us serious, it would be quite impossible to refrain from laughing at the scrupulousness that could put Jive shillings and a penny three farthings at the end PAPER AGAINST GOLD. 47 of a sum of millions, that it almost makes one's head swim but to think of. Laughable, however, as we may think it, those who have such accounts made out, think it no laughing matter. It is, on the con- trary, looked upon by them, perhaps, as no very un- important part of the system. Upon looking at the above progress of the Expen- diture, it is impossible to avoid being struck with the increase, during the present reign. The year 1760 was a time of war as well as the present ; but, as we see, a year of war then, cost only 24 millions ; whereas a year of war now costs 82 millions. We see, too, that a year of war now costs 20 millions more than a year of war cost only ten years ago. What, then, will be the cost, if this war should con- tinue many years longer, and if, as appearances threaten, the enemy should lake such measures, and adopt such a change in his mode of hostility, as to add greatly to the expensiveness of our defence ? This is a very material consideration; and, though it will hereafter be taken up, still I could not refrain from just touching upon it in this place. Am I told, that our money is depreciated or fallen off in va- lue; and that the increase in our expenses is more nominal than real ; that the increase is in name ; merely in the figures, and not in the thing ; for that a pound is not worth anything like what a pound was worth when the king came to the throne ? Arn I told this ? If I am, I say, that we are not yet come to the proper place for discussing matters of this sort ; that we shall come to it all in good time ; but, that, in the meanwhile, I may hope to hear no more abuse of our doctrines, from those, at least, who, in this way, would reconcile our minds to the enormous increase in the nation's yearly expenses. Having now taken a view of tfie increase of the Debt, and also of the yearly expenses of the nation, let us now see how the revenue, or income, or, more properly speaking, the TAXES ; that is to say, the money received from the people, in the course of the 48 PAPER AGAINST G6LD. year, by the several sorts of tax-gatherers ; let us now see how the amount of these has gone on in- creasing. When QUEEN ANNE came to the throne, in 1701. the yearly amount of the taxes was 4,212,358 When GEORGE I. came to the throne in 1714, it was 6,762,643 When GEORGE II. came to the throne in 1727 it was 6,522,540 When GEORGE III. came to the throne in 1760, it was 8,744,682 After the AMERICAN WAR, 1784, it was 13,300,921 At the close of the Anti-Jacohin War, in 1801 it was 36,728,971 For the last year, that is 1809, it was. . 70,240.226 It is quite useless to offer any comments upon this. The figures speak too plainly for themselves to re- ceive any assistance from words. As to the correct- ness of these statements, there may, perhaps, be found some little inaccuracies in the copying of the figures, and in adding some of the sums together; but, these must be very immaterial ; and, indeed, none of the questions, which we have to discuss, can possibly be affected by any little error of this sort. I say this in order to bar any cavil that may, possibly, be attempted to be raised out of circumstances, such as I have here mentioned. Thus, then, we have pretty fairly before us, a view of the increase of the Debts, the Expenses, and the Taxes, of the nation ; and a view it is quite suffi- cient to impress with serious thoughts every man, whose regard for his country is not confined to mere professions. There are persons, I know, who laugh at this. They may have reason to laugh ; but we have not. The pretence is, that taxes return again to those who pay them. Return again ! In what manner do they return ? Can any of you perceive the taxes that you pay coming back again to you ? All the interested persons who have written upon PAPER AGAINST GOLD. 49 taxation, have endeavoured to persuade the people, that, to load them with taxes does them no harm at all, though this is in direct opposition to the language of every Speech that the King makes to the Parlia- ment during every war ; for, in every such Speech, he expresses his deep sorrow, that he is compelled to lay new burdens upon his people. The writers here alluded to, the greater part of whom live, or have a design to live, upon the taxes, always appear to consider the nation as being rich and prosperous in a direct proportion to the quan- tity of taxes that is raised upon it ; never seeming to take into their views of riches and prosperity the ease and comfort of the people who pay those taxes. The notion of these persons seems to be. that, as there always will be more food raised, and more goods made in the country, than is sufficient for those, who own, and who till the soil, and who labour in other ways, that the surplus, or super-abundance, ought to fall to their share ; or, at least, that it ought to be taken away in taxes, which produce a luxu- rious way of living, and luxury gives employment to the people; that is to say, that it sets them to work to earn their own money back again. This is a mighty favour to be sure. The tendency of taxation is, to create a class of persons who do not labour ; to take from those who do labour, the produce of that labour, and to give it to those who do not labour. The produce taken away is, in this case, totally destroyed ; but, if it were expended, or consumed, amongst those who labour, it would produce something in its stead. There would be more, or better cloth ; more or better houses ; and these would be more generally distri- buted ;~ while the growth of vice, which idleness al- ways engenders and fosters, would be prevented. If, by the gripe of taxation, every grain of the sur- plus produce of a country be taken from the lowest class of those who labour, they will have the means of bare existence left. Of course, their clothing and 5 50 PAPER AGAINST GOLD. their dwellings will become miserable, their food bad, or in stinted quantity ; that surplus produce which should go to the making of an addition to their meal, and to the creating of things for their use, will be an- nihilated by those who do nothing but eat. Sup- pose, for instance, a community to consist of a farmer, four cottagers, a tailor, a shoemaker, a smith, a carpen- ter, and a mason, and that the land produces enough for them all and no more. Suppose this little com- munity to be seized with a desire to imitate their betters, and to keep a sinecure placeman, giving him a tenth of their produce which they formerly gave to their shoemaker. The consequence would be, that poor CRISPIN would die, and they would go bare- footed, with the consolation of reflecting that they had brought themselves into this state, from the silly vanity of keeping an idle man. But, suppose the land to yield enough food for all ten of them, and enough for two more besides. They have this, then, besides what is absolutely necessary to supply their wants. They can spare one of their men from the field, and have besides, food enough to keep him in some other situation. Now, which is best, to make him a second carpenter, who, in return for his food, would give them additional and permanent conve- nience and comfort in their dwellings ; or, to make him a sinecure placeman or a singer, in either of which places he would be an annihilator of corn, at the same time that, in case of emergency, he would not be half so able to defend the community ? Sup- pose two of the cultivators became sinecure placemen, then you kill the carpenter or some one else; or, what is more likely, all the labouring part of the community, that is to say, all but the sinecure place- men, live more miserably, in dress, in dwellings, and in food. This reasoning applied to tens, applies equally well to millions , the causes and effects being, in the latter case, only a little more difficult to trace. Such is the way in which taxes operate j the dis- tinction between which operation and the operation PAPER AGAINST GOLD. 51 of rents being this, that in the latter case, you re- ceive something of which you have the particular enjoyment, for what you give ; and, in the former case, you receive nothing. It is by no means to be understood, that there should be no persons to live without what is generally called labour. Physicians, Parsons, Lawyers, and others of the higher callings in life, do, in fact, labour ; and it is right that there should be persons of great estate, and without any profession at all ; but then, you will find, that these persons do not live upon the earnings of others : they all of them give something in return for what they receive. Those of the learned professions give the use of their talents and skill ; and the landlord gives the use of his land or his houses. Nor ought we to look upon all Taxes as so much of the fruit of our labour lost, or taken away with- out cause. Taxes are necessary in every commu- nity ; and the man, whether he be statesman, solr dier, or sailor, who is in the service of the commu- nity, gives his services in return for that portion of the taxes which he receives. We are not talking against taxes in general ; nor, indeed, will we stop here to inquire, whether our taxes, at their present amount, be necessary ; or, whether, by other coun- sels, they might, in great part, at least, have been avoided. These are questions which, for the pre- sent, we will wholly pass over, our object being to come at a correct opinion with regard to the effect of heavy taxation upon the people who have to support it, reserving for another opportunity our remarks and opinions as to the necessity of such taxation in our particular case. By national prosperity the writers above alluded to mean something very different indeed from that which you and I, who have no desire to live upon the taxes, should call national prosperity. They look upon it, or, at least, they would have us look upon it as being demonstrated in the increase of the number of chariots and of fine-dressed people in and 52 PAPER AGAINST GOLD. about the purlieus of the court ; whereas, reflection will not fail to teach us, that this is a demonstration of the increase of the taxes, and nothing more. Na- tional prosperity shows itself in very different ways : in the plentiful meal, the comfortable dwelling, the decent furniture and dress, the healthy and happy countenances, and the good morals of the labouring classes of the people. These are the ways in which national prosperity shows itself; and, whatever is not attended with these signs, is not national prosperity. Need I ask you, then, if heavy taxation be calculated to produce these effects ? Have our labourers a plen- tiful meal of food fit for man ? Do they taste meat once in a day ? Are they decently clothed ? Have they the means of obtaining firing ? Are they and their children healthy and happy ? I put these ques- tions to you, Gentlemen, who have the means of knowing the facts, and who must, I am afraid, answer them all in the negative. But, why need we here leave any thing to con- jecture, when we have the undeniable proof before us, in the accounts, laid before Parliament, of the amount of the Poor-Rates, at two different periods, and, of course, at two different stages in our taxation ; namely, in the year 1784, and in the year 1803 ? At the former period, the taxes of the year, as we have seen above, amounted to 13,300,921 ; and then the Poor-Rates amounted to 2,105,623. At the latter period, the taxes of the year (as will be seen from the Official Statement in Register, Vol. IV. page 1471) amounted to 41,931,747 ; and the Poor- Rates had then risen to 5,246,506. What must they, then, amount to at this day, when the year's taxes amount to upwards of 70 millions of pounds ? Here then, we have a pretty good proof, that taxa- tion and pauperism go hand in hand. We have seen what was produced by the ANTI-JACOBIN WAR. The taxes continued nearly the same from 1784 to 1793, the year in which PITT began that war ; so that, by the ANTI-JACOBIN WAR alone the Poor-Rates were PAPER AGAINST GOLD. 53 augmented, in nominal amount, from 2,105,623 to 5,246,506 ; at which we shall not be surprised, if we apply to this case the principle above illustrated in the supposed community of ten men, where it is shown, that, by taking the produce of labour from the proprietors of it, and giving it to those, who do not labour and do not give the proprietors of such pro- duce any thing in return, poverty, or, at least, a less degree of ease and enjoyment, must be the conse- quence. The Poor-Rates alone are now equal in amount to the whole of the national expenditure, including the interest of the Debt, when the late King came to the throne ; and, the charges of managing the taxes ; that is to say, the wages, salaries, or allowances, to the tax-gatherers of various descriptions ; the bare charge which we pay on this account, amounts to very little short of as much as the whole of the taxes amounted to when King William was crowned. This charge ; that is to say, what we pay to the tax-gatherers, in one shape or another, is stated in the account laid before Parliament for the last year, at 2,886,201, a sum equal to a year's wages of 92,500 labourers at twelve shillings a week, which may, I suppose, be looked upon as the average wages of labourers, take all the kingdom through. Is this no evil ? Are we to be persuaded, that, to take the means of supporting 92,500 families, consisting, upon the usual computation (5 to a family) of 461,000 souls ; that to take away the means of supporting all these, and giving those means to support others, whose business it is to tax the rest, instead of adding to the stock of the community by their labour ; are we to be persuaded that this is no evil ; and that, too, though we see the Poor-Rates grown from 2 millions to 5 millions in the space of 10 years ? Are we to be persuaded to believe this ? Verily, if we are, it is a great shame for us to pretend to laugh at the Mahomedans. Having now taken a view of the progress of the 54 PAPER AGAINST GOLD. National Debt together with that of the National Expenses and Taxes : and having (by stepping a little aside for a moment) seen something of their effect upon national prosperity* we will, in the next Letter, agreeably to the intention before ex- pressed, inquire into the schemes for arresting this fearful progress ; or, as they are generally denomi- nated, plans, for paying off, or, reducing, the Na- tional Debt ; a subject of very great importance, be- cause, as we must now be satisfied, the bank-notes have increased with the Debt, and, of course, the reducing of the Debt would, if it were accomplished, tend to the reduction of the quantity of bank-notes, by the excess of which it is, as the Bullion Com- mittee have declared, that the gold coin has been, driven from circulation. I am. Gentlemen, Your faithful "Friend, WM. COBBETT. State Prison, Newgate, Tuesday, 11th Sept. 1810, ' LETTER IV, Schemes for paying off the National Debt Former Sinking Funds Origin of Pitt's Grand Sinking Fund Changes made by Pitt's sway in the state of this Country Grand Sinking Fund Purposes of it The Commissioners and their manner of Proceeding How they would buy up Griz- zle Greenhorn's share of the Debt What Redemption means Commissioners step into Grizzle's shoes We still are taxed for the Interest Evils of the Grand Sinking Fund What would be really Redeeming American mode of Re- deeming Statement of the Increase of the Interest on the Debt Clause in Pitt's Grand Sinking Fund Act for ceasing to pay Interest, in 1808, upon Stock bought up. GENTLEMEN, OUR next business is to inform ourselves correctly with respect to the Schemes, which, at different times, have been on foot for PAYING OFF THE PAPER AGAINST GOLD. 55 NATIONAL DEBT, and about which paying off we have, all our lives long, heard so much. We have seen how the Debt has gone on increasing from its first existence to the present day ; we have seen how the Expenses of the nation and the Taxes of the nation have gone on increasing with the debt ; we have also seen that the increase of the bank-notes has kept pace with the rest, till those notes have, at last, driven the gold coin out of circulation. This last is the evil, for which the Bullion Committee have endeavoured to find out a remedy, and such a remedy they appear to think that they have found, in an Act of Parliament which they propose to be passed, for causing the Bank Company to pay their promissory notes in gold and silver in two years' time. One of our principal objects, in this discussion is, to enable ourselves to forjn a correct opinion as to the practicability of this remedy, even at the end of two years ; and, as we have, from what has already been shown, good reason to believe, that the quantity of bank-notes, the excess of which has dri- ven the gold out of circulation, cannot be lessened unless the Debt be also diminished, it is necessary for us to ascertain what has been done or attempted, and what is likely to be done, in the way of causing such diminution. From very early stages of the Debt ; indeed, al- most from the very beginning of it, there were mea sures proposed for paying it off, the idea of an ever- lasting Debt, and an everlasting mortgage upon the nation's means, being, at first, something too fright- ful for our upright and sensible ancestors to bear. Propositions, and even provisions, were, at different times, accordingly made for paying off parts of the Debt" and some comparatively small sums were, in the early stages of the progress, actually paid off; the Debt became less, and less interest was, of course, paid upon it. Still, however, as new wars came on, new sums were borrowed ; and, as lending money to the Government was found to be a profitable trade ; 56 PAPER AGAINST GOLD. as so many persons of influence found their advan- tage in the loaning transactions, the money was al- ways easily enough raised. But, yet there continued to be a talk of -paying off the Debt ; and, in time, a part of the yearly taxes were set aside for that pur- pose, which part of the taxes so set aside was called a SINKING FUND. These being words, which, as belonging to our present subject, are of vast importance, it is neces- sary for us to have a clear notion of their meaning. The word Fund, as was before observed in Letter II. page 13, means a quantity of money put together for any purpose; and, in the instance before us, the word Sinking appears to have been prefixed to the word Fund in order to characterize, or describe, the particular purpose, or use, of the taxes so set apart 5 namely, the purpose of sinking, or reducing, or diminishing, or lessening, the Debt. So that the Sinking Fund, of which we have all heard so much, and of which most of us have known so little, means, in other words, in words better to be understood, a Lessening Fund ; and whether the thing has, in its operations, hitherto, answered to its name, we shall by-and-by see, if, indeed, we have not seen enough to satisfy us upon this point in the increasing of the Debt, as exhibited in the foregoing Letter. The amount of taxes thus set apart, or, to use the words with which we must now grow familiar, the Sinking Funds, which were, time after time, esta- blished, were, in many cases, applied to other pur- poses than that for which they were destined, or in- tended. Indeed, they seem, for many years, to have been very little better than purses made up at one time and spent again at another, without answering any rational purpose at all ; and, accordingly, the nation does not appear to have paid any great atten- tion to them, or to have considered them as of any consequence, until the year 1786, when the present GRAND SINKING FUND was established by PITT, oj but a little while before, had been made Prime PAPER AGAINST GOLD. 57 Minister, and whose system has continued to this day. Gentlemen, we are now entering upon a part of our subject, which not only demands an uncommon portion of your attention, but into the discussion of which you will, I hope, carry such a spirit of im- partiality as shall subdue all the prejudices of party, and dissipate all the mists of ignorance which have therefrom arisen. It is, even yet, impossible to men- tion the name of PITT, without exciting feelings that struggle hard against reason, and that, in some minds, overcome it. During his administration, the nation was divided into two parties, so hostile to each.other, that both were easily made subservient to his views ; and, it is, with every man who really loves his coun- try, matter of deep regret, that the same, or nearly the same, divisions continue to the present day. It is not for me, who, at one time, really looked upon PITT as the greatest minister that England ever saw, to reproach others, who may still be as igno- rant of the truth, as I was then^ for their attach- ment to his memory, for their high opinion of the schemes of his inventing, and for their blind adora- tion of those schemes ; but when they have, as I have, taken a fair and full view of all his measures ; when they have compared his deeds with his pro- fessions, his performances with his promises ; when they have seen, that he added threefold to our Taxes and our Expenditure, and that, notwithstanding this, the power and the territory of France were, extended in proportion to the sacrifices he called upon us to make for what he called resisting her ; when they see, that the standard of national misery, the Poor- Rates, rose, during his sway, in almost a triple de- gree;- when they see, that the war, at the outset of which he relied, in no small degree, for success upon the destruction of French assignats, did, at the end of four years, cause the stoppage of gold and silver payments at the Bank of England, and that its prolongation has led to a state of things, in which a 58 PAPER AGAINST GOLD. public print devoted to the Government, has described the largest class of English bank-notes as " destruc- tive assignats ;" when they see this, and when they see, that, the National Debt, which he himself called, " the best ally of France ;" when they see, that that Debt, which he found at 200 millions and odd, he left at 600 millions and odd, while France, during his wars against her, had exchanged her assignats for gold, and had extended her territory and her sway to a degree which made that nation, whose power our forefathers despised, an object of continual dread to England; when the former partizans of PITT see this, as they must, aye, and/ee/ it too, will they still persist in asserting the wisdom of his plans ; and, above all, will they, when they see the debt tripling in amount under his hands, still persist in asserting the efficacy of his Sinking Fund, and, upon that bare assertion, reject all inquiry into either the nature or the effect of that celebrated scheme ? Let us hope, that in a country boasting of the though tfulness of its people, there can be but very few persons so besotted as this ; and, indeed, it is due to the country to say, that there do not appear to be any such left, excepting amongst those who live upon the taxes, and whose perverseness arises not from their want of information. But, be this as it may, I am satisfied that you, my Friends and Neighbours, who, like me, have no interests separate from those of our country, will not, whatever may have been your prejudices heretofore, wilfully shut your eyes against the truth, and that you will accompany me in this inquiry with that great attention, which, as I before observed, the subject demands. Pitt's Sinking Fund was begun in the year 1786, by an Act of Parliament (being Chapter XXXI. of the 26th year of the reign of Geo. III.) entitled u An Act for vesting certain sums in Commission- ers^ at the end of every Quarter of a Year, to be by them applied to the Reduction of the National Debt." In virtue of this Act, a certain part of the PAPER AGAINST GOLD. 59 taxes was, in each year, to be paid to certain persons named in the Act, as Commissioners for managing the concern ; and these taxes, together with the ac- cumulations upon them, have been, as formerly, called a Sinking Fund. It is no matter what was the amount of the sum, or sums, of money, thus to be set apart out of the taxes, and to introduce particulars of that sort would only embarrass our view. Suffice it to know, that certain sums of money, being a part of the taxes, were set apart, and that, with this money, together with its growing interest, the Commissioners, appointed by the Sinking Fund Act, were, at stated periods, and with certain limitations in their powers, to redeem the Debt as fast as they could, the word redeem ha- ving now come into fashion instead of the word pay off. It is of no consequence what were the. periods, what were the days of the week or the times of the moon, when this work of redemption was to be per- formed. The effect is what we have to look after , but, in order to have a clear view of even that, we must see the manner of doing the thing, the manner of redeeming or paying off the Debt ; for, without that, we shall be continually exposed to be bewildered and deceived ; and, indeed, we shall be quite unable to form any thing like a clear notion of what the Sinking Fund really is. The Commissioners, with the money thus put under their care and management, were to purchase up stock from individuals, which stock would then become the property of the nation. But, stay. We must go gently on here, or we lose ourselves in a moment. We must, indeed, not proceed a step further, till we have gone back to Letter II, at pages 36, 37 f and 38, and have taken another look, and re- freshened our memories as to what STOCK means. Having done so, and read on to the end of the first pa- ragraph in page 38, we may proceed by repeating, that the Commissioners were to go to work with the money lodged in their hands, out of the taxes, and purchase CO PAPER AGAINST GOLD. up Stock. We have seen, in the pages just referred, to, how Stock is made ; we have seen how MUCK WORM lent his money to the Government ; we have seen how he got his name written in a book in re- turn for his money ; we have seen that Stock is no- thing that can be seen, heard, smelled or touched ; we have seen that it signifies the right of receiving interest upon money lent to the Government, which money has been long ago expended ; we have seen the operation by which MUCKWORM became possessed of Stock : and lastly, we have seen our neighbour, FARMER GREENHORN, purchase two thousand pounds' worth of MUCKWORM'S Stock, which the former be- queathed to his poor daughter GRIZZLE. Now, then, observe ; the whole of the Stock, of which the National Debt is made up, is exactly the same sort of thing as this two thousand pounds' worth of Stock, belonging to Grizzle Greenhorn. There is a book in which a list of the names of all those persons is written, who have, like Grizzle, a right to draw in- terest from the Government out of the taxes ; against each name in this list is placed the amount of the sum for which the person has a right to draw interest. Some have a right to draw interest for more and some for less. And these sums make up what is called the National Debt. Of course, the Sinking Fund Commissioners, in order to pay off the National Debt, or any part of it, must purchase up Stock from indi- viduals ; or, in other words, pay them off their share of the Debt. If, for instance, Grizzle Greenhorn has a mind to have her two thousand pounds to lay out upon land, or do any thing else with, she sells her stock, and, if it so happen, she may sell it to the Commissioners ; and thus, as they pay her for it with the nation's money, it is said, that, by this transaction they have redeemed (by which I should mean paid oJJ) two thousand pounds of the National Debt. Grizzle, who was the creditor, has got her money again ; she has no longer any right to draw interest for it ; and, of course, you would think, that these PAPER AGAINST GOLD. 61 two thousand pounds' worth of Deht were paid off, and that the nation, that we ihe people, had no longer any interest to pay upon it; you would naturally think, that we were no longer taxed to pay the in- terest upon this part of the Debt. Greatly, however, would you be deceived ; cruelly deceived, if you did think so ; for, notwithstanding the Commissioners have redeemed these two thou- sand pounds, we have still to pay the interest of them every year ; we are still taxed for the money where- with to pay this interest, just in the same way as if the two thousand pounds' worth of Debt had not been redeemed at all, but still belonged to Griz- zle Greenhorn ! This is an odd way of redeeming ; an odd way of paying off ; do you not think it is, Neighbours ? We have before seen, that the National Debt is a mortgage upon the taxes. It is constantly called so in conversation, and in writings upon the subject. But, should not either of you, who happened to have a mortgage upon your land or house, think it strange if, after you had redeemed a part of the mortgage, you had still to pay interest upon the part redeemed as well as upon the part unredeemed ? TO REDEEM, as applied to money engagements, means to discharge, to set free by payment. This is the meaning of the word redeem, as applied to such matters. It sometimes means to rescue or to ransom, from captivity, from forfeiture, or from peril of any sort, by paying a price. But, in every sense in which this word is used, it always implies the set- ting free of the object on which it operates; and, when applied to a mortgage, a bond, a note of hand, or a Debt of any sort, it implies the paying of it off. How, then, can the two thousand pounds' worth of Debt,- purchased from Grizzle Greenhorn, by our Sinking Fund Commissioners, be said to be redeemed by us, if we are still taxed to pay the interest upon it, and, of course, if it be not discharged, and not set free? Nothing, at first sight, appears more plausible, no 6 62 PAPER AGAINST GOLD. thing more reasonable, nothing more clear, than the mode above described, of redeeming the Debt by pur- chasing from the several individuals, who, little Griz- zle Greenhorn, own the Stock or the Debt, their re- spective shares thereof. And, the operation is as simple as any thing can be. For, the Sinking Fund Commissioners, having, for instance, received two thousand pounds from the tax-gatherers, in virtue of the Sinking Fund Act, go and purchase Grizzle's Stock ; they give her the two thousand pounds ; her right to draw interest from us ceases; her share of the Stock or Debt is redeemed or paid off; and her name is crossed out of the Book. Ah ; but alas ! the names of our Sinking Fund Commissioners are 'written in the Book instead of hers ! Aye : we have to pay the interest of the two thousand pounds to them instead of to her ; and our taxes on account of this, which is called the redeemed part of the Debt, are just as great as they were before this cu- rious work of redemption began. " Well then," you will say, " what does this thing mean; and what can it have been intended for?" Why, to speak candidly of the matter, though the thing was an invention of PITT, under whose sway so much mischief came upon this nation, I believe that the thing was well meant. I believe that it was intended to free the nation from its Debt. But, I am satisfied, that it has been productive of no small part of the evils, which England and which Europe have experienced since its invention ; for, by giving people renewed confidence in the soli'dity of the Funds or Stocks, it rendered Government borrowing more easy ; and, of course, it took from the Minister that check to the making of wars and the paying of foreign armies, for the want of which check th^ Ex- penses and Taxes and Debt of the country have been so fearfully augmented, to say nothing, at present, about the dreadful changes which those wars have made in our affairs both at home and abroach To produce such effects was, however, certainly PAPER AGAINST GOLD. 63 not the intention of the scheme. The intention was, that the Sinking Fund Commissioners should, with the money put into their hands out of the taxes, pur- chase up Stock, or parts of the Debt, belonging to individuals ; that the parts so purchased up, should not cease to exist ; that, they should be written in the Great Book under the name of the Commission- ers ; that the Commissioners should receive the in- terest upon them, instead of its being received by in- dividuals as before ; that this interest, as fast as it came into the hands of the Commissioners, should, like the money paid to them annually out of the taxes, be laid out in purchasing up more Stock from individuals ; and that the thing should go on thus, till the last of the Stock, or Debt, got into the hands of the Commissioners ; when, of course, the Govern- ment might burn the Great Book ; and the National Debt would be paid off. This scheme was very pretty upon paper ; it made a fine figure in the newspapers and pamphlets of the day ; and looked quite solemn when embodied into an Act of Parliament. There was, to be sure, when people looked into the matter more closely, something rather whimsical in the idea of a nation's paying interest to itself ; something very whimsical in a na- tion's GETTINGMONEYby paying itself interest ' upon its own Stock. Many persons thought so, at the time, and some said so ; but the formidable tables of figures made out by court calculators, and the flowery and bold speeches of PITT, soon put all such persons out of countenance, and reduced them to si- lence ; or exposed them to the charge of faction and disaffection and disloyalty. The country, infatuated with its " heaven-born Minister," became deaf to the dictates of common sense ; and, with as much fond- ness as the mother hangs over her smiling babe, it cherished and fostered the fatal delusion. As the execution of the Sinking Fund Act pro- ceeded, more and more of the Stock, or parts of the Debt, became of course entered in the Great Book in 64 PAPER AGAINST GOLD. the names of the Commissioners. Hence arose a new denomination in our national money accounts; namely, the Redeemed Debt ; that is, the parts of the Debt, as aforesaid, purchased up by the Commission- ers, was now called the " Redeemed Debt ;" a phrase which contains a contradiction in itself. But, still, it was unavoidable ; for, it was not paid off ; it was bought up, but we had still, and have still, to pay interest upon it ; and, therefore, it could not be said to be paid off ; for, it would be folly too gross to pretend that we have paid off a debt or a mortgage, for which we were still paying interest. If, indeed, the parts of the debt, which were purchased up by the Com- missioners, had been, at once, done away, and we had ceased to pay interest upon them, then those parts would have been really redeemed. If, for in- stance, Grizzle Greenhorn's two thousand pounds' worth of Stock had been crossed out of the Great Book, and had not been inserted in it again under any other name, that two thousand pounds' worth of the Debt would have been redeemed in reality. This is the way in which the Sinking Fund of the Ame- rican States operates. They raise yearly a certain sum in taxes ; with that sum they purchase up part of their Debt ; and then that part of the Debt ceases to exist in any shape whatever. The next year they raise a like sum in taxes, and again purchase up par- cels of the Debt. And, thus they proceed, having every succeeding year, less and less interest to pay upon their Debt. This is real redemption : this is real paying off. But, the way in which we pro- ceed bears no resemblance to it ; nor has any thing in common with it, except it be the name. Let us, before we proceed any further, take a view of the increase of the interest that we have to pay upon the Debt. We have seen in Letter III., page 43, how the debt itself has gone on increasing. But, we have not yet taken a look at the increase of the INTEREST ; though this is very material, and, in- deed, it is the only thing, belonging to the Debt, PAPER AGAINST GOLD. 65 worthy of our attention. The statement of the amount of the Debt itself is of no practical use, ex- cept as it serves to illustrate, to render more clear, the part of the subject upon which we now are. For, as we have seen, the Debt is nothing more than, a right possessed by certain persons, called Stock- holders,, to draw interest from the nation ; or, in other words, to take annually, or quarterly, part of the taxes raised upon the people at large. Let us, therefore, take a look at the progress of this interest. When Q,UEEN ANNE came to the throne in 1701, the annual interest on the National Debt was 1,310,942 When GEORGE I. came to the throne, in 1714 3,351,358 Yv r hen GEORGE II. came to the throne, in 1727 2,217,551 When GEORGE III. came to the throne, in 1760 . . 4,840,821 After the AMERICAN WAR, in 1784, and just before the making of Pitt's Sinking Fund 9,669,435 At the latter end of the ANTI-JACOBIN WAR, in 1801 ........ 21,778,018 For the LAST YEAR, that is 1809 . . 32,870,608 There are included in this sum " charges for man- agement ;" and, as we have before seen, there is some of the Debt (small portions) called the loans, or debts, of the Emperor of Germany ', and of the Prince Regent of Portugal, which, it is possible, they may repay us ; but, this is as, as it is called in the account laid before Parliament, during the last session, the " Total charge on account of Debt, pay- able -in Great Britain." And, let me ask any sen- sible man, what consequence it can be to us what the Debt is called, what consequence by what name the different sorts of it may go, so that the interest upon it still goes on increasing, and so that we have to pay the whole of that interest out of the taxes ? When PITT'S Sinking Fund was established, there 6* 66 PAPER AGAINST GOLD. was a time fixed, when the interest should begin to be diminished. I mean, a time was fixed, when the people should no longer pay taxes to defray the in- terest upon the Stock, or parts of the Debt, which should after that time be purchased up by the Com- missioners. The time so fixed was 1808, two years ago. The year was not named in the Act ; but, it was known to a certainty ; because this ceasing to pay interest was to begin, when the interest upon the Stock, or parts of the Debt, bought up, together Avith the sums paid to the Commissioners out of the taxes, should amount to a certain sum (four millions an- nually ;) and, as the sums to be paid to them were fixed, it was a mere question of arithmetic when the paying of interest would cease, agreeably to the terms of the Act ; as expressed in the XXth clause, as fol- lows : " And be it further enacted by the authority aforesaid, that whenever the whole sum annually re- ceivable by the said Commissioners, including, as well, the quarterly sum of two hundred and fifty thousand pounds herein before directed to be issued from the Exchequer, as the several Annuities and Dividends of Slock to be placed to the account of the said Commissioners in the Books of the Governor and Company of the Bank of England, by virtue of this Act, shall amount in the whole to FOUR MIL- LIONS ANNUALLY, the Dividends due on such part of the Principal or Capital Stock as shall thence-forth be paid off by the said Commissioners, and the Mo- nies payable on such annuities for Lives or Years as may afterwards cease and determine, SHALL NO LONGER BE ISSUED AT THE RECEIPT OF HIS MAJESTY'S EXCHEQUER, but shall be CONSIDERED AS REDEEMED by Parlia- ment, and shall remain to be disposed of as Parlia- ment shall direct." In what way it might have been supposed, that Parliament, in its wisdom, would dispose of these parcels of redeemed debt, I shall not, for my part, presume to hazard a conjecture ; but, as was before observed, it was easy (the sums PAPER AGAINST GOLD. 67 being given) to ascertain the time, when the provi- sion in this clause would begin to operate ; and, that time was, the year 1808. There was another Act, passed seven years later, (1792,) allotting more of the taxes to the same pur- pose (Chapter 52 of the 32nd year of this king's reign ;) and still the same provision was made ; namely, that, when the produce of the Sinking Fund should amount to 4 millions annually, all the Stocky or parts of the Debt, that should be purchased up by the Commissioners after that time, SHOULD NO LONGER HAVE INTEREST PAID UPON IT OUT OF THE TAXES ; but that these parts of the Debt should (mark the words) " be considered AS REDEEMED." And so they would. They really, in that case would have been redeemed ; but the word redeemed is now applied, even in the Ac- counts laid before Parliament, to those parts of the Debt bought up by the Commissioners, the dividend, or interest, on which parts, IS STILL ISSUED AT THE EXCHEQUER 5 that is to say, is still paid out of the taxes! And all this goes on amongst " the thinking" people of England ! But what was done in the long-expected year 1808 ? What was done, when the year of promise came ? This is the most interesting part of this most curious history ; but, as to bring to a close the whole of the discussion, relating to the Sinking Fund, would ex- tend this letter to double its present length, 1 think it better to make the remaining part of it the subject of another Letter, beseeching you, in the meanwhile, to make up, by your patience in the perusal, for whatever want 01 clearness may be discovered in the writer. I remain, Gentlemen, your faithful friend, WM. COBBETT. State Prison, Newgate, Thursday, September 14, 1810. 68 PAPER AGAINST GOLD. LETTER V. " I would inculcate one truth with peculiar earnestness ; namely, that a Revolution is not the necessary consequence of a National Bankruptcy." i Pursuits of Literature. Digression respecting the use of Bank-Notes as a Political Support to the Government Mr. Addington's Notion of convincing Buonaparte by the means of a Tax Answer of the Mpniteur Advice given to Mr. Addington in the Re- gister in 1803 Passage quoted from a Government News- paper, describing Bank-Notes as necessary to the Existence of the Government Same Doctrine promulgated by Blr. Paine in his Rights of Man How different is this from what the World has been told Effect of it to encourage the Enemy Resume the subject of the Sinking Fund No Interest taken off in 1808 Addington's Act of 1802 George Rose quoted to prove that it was clearly held forth to the Nation, that Taxes would be repealed in consequence of the Sinking Fund P. S. Sir John Sinclair's Pamphlet. GENTLEMEN, BEFORE we resume the discussion, relating to Pitt's Grand Sinking Fund, which want of room obliged us to break off, at the close of the last Letter, I think it may be useful to submit to you here an observation or two, calculated to obviate any un- founded apprehensions that might otherwise be ex- cited by the apparently inevitable fate of the paper- money ; and this I deem the more necessary, as pub- lications are daily appearing, from the pens of igno- rant or interested persons, the evident tendency, and, indeed, object, of which is, to persuade the public, that the existence of the Government ; that the ex- istence of law and order ; that the safety to persons and property ; nay, that the continuance of the very breath in our nostrils, depend upon the credit of the bank-notes. The author, from whose writings I have taken my PAPER AGAINST GOLD. 69 motto to this present Number of my work, was, you see, of a very different opinion ; and, I have quoted his sentiment upon the subject, because his work is well known to be of what is called the ANTI- JACOBIN kind, that is to say, a work, the tendency of which is to prevent men like you from having any thing to say or to do, any more than your horses, in the af- fairs of Government. This writer, who, however, might mean well, and who is certainly a very clever man, so far from supposing that the existence of the Government depended upon the credit of bank-notes, is, you see, fixed in his opinion, and an opinion that he wishes " to inculcate with peculiar earnestness," that a REVOLUTION, thereby meaning a change in the form of Government, is not the necessary conse- quence, even of a national bankruptcy ; that is to say, not only a total discredit of all the paper-money and especially the Bank of England Notes, but also an utter inability to pay, in any way whatever, the interest upon the National Debt, or any part of it. This is my opinion also, as it always has been since I turned my attention to the subject. At the beginning of the present war, Mr. ADDINGTON, who was then the Prime Minister, told the House of Commons, that one of his principal objects in laying on the Property Tax and other war taxes, was, " to convince Buonaparte, that it was hopeless for him to contend with our finances" To which the MONITEUR, or French government-newspaper, re- plied : " Pay your bank-notes in gold and silver, and then we will believe you, without your going to war."* Whether the Minister made good his promise ; whether he has convinced Buonaparte, that, it was " hopeless for him to contend with our finances" you. Gentlemen, are as likely to be able to judge as any body that I know. I, for my part, blanked the Minister, for holding out such a motive for his tax- ing measures. I said to him : The true way of con- * Register, Vol. III., page 948, June, 1803. 70 PAPER AGAINST GOLD. vincing your enemy, that this war upon your finances will be useless, is to state explicitly to the world, that you are not at all afraid of the consequences of what is called a national bankruptcy ; for, while you endeavour to make people believe that such an event cannot possibly happen, they will certainly think that you regard it, if it should happen, as irre- trievable ruin and destruction; and, therefore, as you never can quite overcome their apprehensions, the best way is to be silent upon the subject, or to set the terrijic bug-bear at defiance. To Bona- parte's exultation at our approaching bankruptcy, the answer is always ready : France has been a bank- rupt ; France has not paid her paper-money in specie ; yet, France is not the weaker for that ; France is, in spite of her ruined finances, in spite of the long pamphlets of Sir Francis D'lvernois and Mr. Rose, in spite of the longer speeches of Lord Mornington, Lord Auckland, and Mr. Pitt, in spite of the innumerable columns of figures which these no- blemen and gentlemen have drawn up in battle array against her ; in spite of all this, France is yet pow- erful, yea, much more powerful than she was before she experienced what is called a national bankrupt- cy. What ground, therefore, have the French to rejoice at our finances being about to undergo a simi- lar operation ? Such were my sentiments and my reasoning upon this subject, seven years ago ; a time, when to pro- nounce the word depreciation, as applied to bank notes, was sure to expose a man to charges very little short of treason, which charges were made by those very persons who have now declared the greater half of our bank notes to be " destructive assignats" and who have called them " vile and dirty rags" My opinion was, and it still is, that the total destruction of the paper money would not cause any change injurious to this kingdom ; and, indeed, I should have a most hearty contempt for the constitution and for the whole form and compo- PAPER AGAINST GOLD. 71 sition of our Government, if -I thought that their existence depended upon the credit of bank-notes. There are, however, those who think just the re- verse ; and these are, too, writers, who appear to be entirely devoted to the Government : one of whom goes so far as to say, that the Government has no other trust-worthy support than that which it de- rives from the bank-notes. " The human mind," says he, " is sensible only of the present good, or evil, and has too little thought to anticipate conse- quences, and if it was not for the immediate per- sonal interest of a very large and informed part of the community in the National Debt, Patronage and Paper Currency, GOVERNMENT COULD HAVE NO EXISTENCE, standing insulated on the pure basis of duty, and remote national and respective good. The conduct of Sweden, America, Ireland, and the Jacobins of England, in their par- tiality for France, exemplify a want of sense to execute the maxims of EPICURUS; The paper curren- cy of bank-notes (there should be no Country Bank) offers to Government a most indestructible sup- port, because IT MAKES THE DAILY BREAD OF EVERY INDIVIDUAL DEPEND SUB- STANTIALLY ON THE SAFETY OF GO- VERNMENT, whereas money, which may be hoarded, separates the individual from the public safety. In the present revolutionary state of the world, I think our paper currency a most miraculous 'mean of sal cat ion, and the man who would pro- pose the payment of bank-notes in specie at any period, to separate individual property from public safety, might as well propose the burning of the Navy to protect the commerce of the icor/c/."* Gentlemen, do you remember he writings of PAINE ? Do you remember the Rights of Man, for the writing of which the author was prosecuted by the then Attorney General who is now the Lord Chancellor ? Do you remember the Rights of Man, * MORNING POST newspaper: 14th Sept., 1810. 72 PAPER AGAINST GOLD. the author of which was prosecuted, and, being absent, was outlawed ; the publishers of which were prosecuted, all over the kingdom ; the circula- ting of which was forbidden by proclamation ; and, to counteract the principles of which, ASSOCIATIONS were formed, of the rich and the powerful ? Well, it was in this very work, that the doctrine here laid down by this government writer, was first started. PAINE said, that the existence of the Government depended upon the existence of the bank-notes ; and that, the question was not, how long the British Government would stand ; but how long the Fund- ing System would last. PAINE'S mode of reasoning was, if I am correct in my recollection, as nearly as possible like that of this government writer. He laid it down as an admitted fact, that the people (owing to causes that he stated) must be wholly in- different about the fate of the Government / but, that, as so many of them were, either by holding Stocks or bank-notes, interested in the fate of the Government, they would, while the Stocks or bank- notes lasted, continue to support the Government, whatever might be their feelings towards it. But, that, when, from whatever cause, the Funding Sys- tem should fail, not a soul would be found to lift a finger, or, even to express a wish in favour of the existence of the Government. Just the same, or rather more, is now said by this government writer; a writer, one half of whose pages are filled with invectives against those whom he calls the friends of the Emperor of France. But, how is it possible for any thing to be written more agreeable to the Emperor Napoleon than what this writer has put forth ? Until now the world has been told that we entertained a real love for our Government ; that we were attached to our constitution because it afforded such fine protection to our persons and our property that we loved the constitution, because it insured to us the enjoyment of liberty, and de- fended us against every species of oppression ; that PAPER AGAINST GOLD. 73 we liad made numerous sacrifices, and that we were ready to make as many more, nay, even ;c to spend our last shilling and shed the last drop of our blood" for the sake of these liberties and in defence of a king, whom we so dearly loved, and, in grati- tude for the blessings enjoyed during whose reign, we held a Jubilee. Until NOW, this is what the world has been told. But NOW it is told, by this loyalty-professing writer, that the only motive whence we support the Government at all, is, to preserve the value of the bank-notes that we hold ; that, if it was not for the immediate personal interest of so many people in the National Debt, and for patronage and paper currency, the Government could have no existence ; that we support the Go- vernment because, without its existence, the bank- notes would fall, and because, by the number of bank- notes, we are thus made to depend upon the safety of Government for our daily bread; and that, therefore, the man who would propose the payment of bank-notes in gold and silver at any period, might as well propose the burning of the navy, or, in other words, the giving up of the country to France. What, Gentlemen ! are we never, then, to see gold and silver again ? Every Minister ; every Member of Parliament ; every one of those who endeavoured to palliate the measure of protecting the Bank Com- pany from paying their notes in gold and silver ; every one of them " lamented the necessity ," as they called it, of the measure. But, NOW, behold, we are told that it was a good thing ; and not only a good thing, but that the Government could not exist without it! Gentlemen, we call ourselves a " thinking people ;" but, believe me, that this is what would not have been said to any other civilized people upon earth. We might here easily show how encouraging a prospect doctrines of this sort hold out to our enemy, and how strong an inducement to use all those means, whether in the way of attack or of menace, 74 PAPER AGAINST GOLD. which are likely to destroy the credit of the paper- money, that being, if these doctrines be sound, the sure and certain way of destroying our Government. But, another opportunity will offer for observations upon these matters ; and, it is now time that we return to our inquiry into the SINKING FUND. In the last Letter, page 66, 67, having stated the provisions, made in the ACTS of 1786 and 1792, for the nation's ceasing to pay interest upon the Stock that should be redeemed, or bought up by the Com- missioners, after the year 1808 ; or, in other words, the nation's ceasing to pay taxes on account of the Stock, or part of the Debt, which should be bought up after that time : having stated these provisions, we were proceeding to inquire What was done in the long-expected year, 1808? What was done when the year of promise came? Why, my Neighbours, nothing at all was done : just nothing at all in the way provided for. The nation ceased to pay no dividends of interest ; and, of course, this work of redemption caused none of its taxes to be taken off. " Well," say you, " but is it possible, that, after such a solemn proceeding ; after the express and positive declaration in two Acts of Parliament, that the dividends of interest should cease to be paid in 1808 ; is it possible that, after that, all the dividends did continue to be paid, jws the same as if those Acts had never been passed ?" O, yes ! It is not only possible to be so, but it is so. All the dividends have continued to be paid ; and are paid to this day. The above-mentioned provisions, in the Acts of 1786 and 1792 were repealed. The Parliament undid what it had before done. It did away the provisions which it had mado in 1786 and 1792. It passed another Act, which said that those provisions should not be carried into effect ; or, in other words, that which was law before was no longer law. This new Act was passed in the month of June, 1802 j ADDINGTON, the successor and the friend of PAPER AGAINST GOLD. 75 PITT, being then Minister. This Act (which is Chapter 71 of the 42d year of the reign of George III.) is entitled" An Act to amend and RENDER MORE EFFECTUAL two Acts passed in the twenty-sixth and thirty-second years of the reign of His present Majesty, for the reduction of the Na- tional Debt." This Act, which was to render those two Acts more effectual, sets out by stating, that the said two Acts had been by experience found "to be attended with most beneficial consequences to the public credit of the country ;" and, having made that declaration, it sets to work, and repeals the two provisions above-mentioned ; and, of course, when the year 1808 came, when the year of expectation arrive-d, no dividends ceased to be paid, and interest upon the whole of the Debt was still paid, and is still paid to this day. Gentlemen, it is hardly to be believed, that any men, who, like PITT and his associates and support- ers, had invented and caused to be passed, the two first-mentioned Acts, could propose the last-mention- ed Act, that is to say, the Act of 1802. Not only, however, did they propose it, but the ANTI- JACOBIN writers laughed m our faces and called us fools, if not levellers and Jacobins, if we ventured to express any doubt at all of the wisdom and justice of any of these successive measures ; and, these writers stout- ly denied, that it ever was intended to take off any of the taxes in 1808 ; and, of course, they maintain- ed, that we, who felt disappointment in this respect, were fools for our pains, and, indeed, they expressed themselves thus, that we were " nature's fools" and not the fools of the Minister. Never, surely, were any portion of mankind treat- ed with such barefaced contempt as the people of England were, at the time referred to, by the venal writers of newspapers, pamphlets, magazines, and reviews, who, seeing the people terrified out of their senses, by alternate alarms within and without, seemed to think that he was the best man who could 76 PAPER AGAINST GOLD. show the greatest degree of scorn for their under- standing and character. Had not this been their persuasion, would they have dared to tell us, that none but fools ever- expected the Sinking Fund to produce a repeal of taxes, when it must still remain in the memory of every man, who was then at all conversant in political matters, that the repeal oj taxes ; the lessening of the taxes ; the making of their burthens less, was the promise held forth to the people by the supporters of PITT ; nay, when it is notorious, that PITT owed the establishment of his tremendous power to the opinion which the people entertained, that he had discovered, and would put in practice, the means of reducing the load of their taxes ? This, as the great end of his schemes, was so much talked of; it is so well known, that this was so distinctly stated in the speeches in Parliament, and so many times repeated, that I am almost ashamed to trouble you with any proof of the fact ; yet, considering that the point is of great importance, I will put the matter beyond all dispute by a reference to a work on the increase of the Resources of the kingdom, published in 1799, under the name of GEORGE ROSE, who was then a Secretary of the treasury, and who is now Treasu- rer of the Navy and a Privy Counsellor, and who, in the execution of the work about to be cited, was, doubtless, assisted by PITT himself. Indeed, this must have been the case ; or, at least, it must be believed, that nothing, upon such a subject, and under the name of his official Secretary, would be published without PITT'S previous approbation. In this work, which is entitled, " A Brief Examination into the Increase of the Revenue, Commerce, and Manufactures of Great Britain, from 1792 to 1799 ;" in this work the hopeful effects of the Sinking Funds of 1786 and 1792 are pointed out, and the writer says : " By the operation of these sinking-funds, without any further intervention of Parliament, the one existing before the war will attain its maximum PAPER AGAINST GOLD. (4,000,000 a year) most probably, in 1808, in no case later than February, 1811. As the dividends due on such parts of the old debt as shall be paid off after the sinking-fund shall have attained its maxi- mum, and the annuities which shall afterwards fall in, will be at the disposal of Parliament, the period of REPEALING TAXES annually, to an amount equal thereto, cannot be delayed more than nine, ten, or eleven years" Need I ask you, Gentlemen, whether you have heard of any repealing of taxes ? Whether you have felt your load of taxation lightened ? Whe- ther you pay less taxes, than you paid when this placeman wrote his book in 1799 ? No : these questions I need not put to you ; nor need I ask you what are your feelings towards those who fed you with hopes of a diminution of your burdens ; nor need I, perhaps, say one more word upon the subject of the Sinking Fund, not to have seen through which by this time would argue a much greater want of discernment than I am disposed to attribute to any part of my countrymen, and especially to you, whose discerning faculties have, as to matters of this sort, been, of late, pretty well sharpened by experience. Nevertheless, with the hope of leaving no possibility of bewildering any body in future, with regard to the nature or effect of the Sinking Fund, I shall add some additional remarks ; but, as these remarks will open to us quite new views of the matter, and I will extend to some length, I shall postpone them to my next ; and I remain, in the meanwhile, Your faithful Friend, WM. COBBETT. State Prison, Newgate, Monday, Sept. 17, 1810. P. S. A pamphlet, entitled, "OBSERVATIONS ON THE REPORT OP THE BULLION COMMITTEE," has just been published by Sir JOHN SINCLAIR, who is, it seems, a member of Parliament, and who is said to 7* 78 PAPER AGAINST GOLD. have been recently made a Privy Counsellor. So much of such gross ignorance, in so short a compass, I do not recollect to have met with in the course of my reading, except, perhaps, in the Morning Post newspaper, or in the British Critic Review. Such a publication would be wholly unworthy of serious notice, were it not pretty evidently the vehicle of the sentiments and views of others. For this reason, some of its prominent absurdities will be noticed, when I come to that part of my subject to which they more particularly belong. In the mean time, in order to furnish the means of judging of this wri- ter's depth of understanding, take the following specimen from a former work of his, and compare his theory with the practice now before our eyes. " The PUBLIC DEBTS of a nation, not only attract riches from abroad, with a species of magnetic in- fluence, but they also retain money at home which otherwise would be exported, and which, if sent to other countries, might possibly be attended with pernicious consequences to the State, whose wealth was carried out of it. If France, for example, main- tained its wars by borrowing money, and England raised all its within the year, the necessary conse- quence would be, that all the loose and unemployed money of England, would naturally be transmitted to France, where it would be placed out to advan- tage." This is quite sufficient. The next time that Sir JOHN thinks of writing upon matters of this sort, he will do well to go, previously, and take a lesson of Mrs. DE YONGE. She will be able to tell him for a certainty, whether National Debts have a tenden- cy to keep money at home, to prevent it from being exported, and to bring money from abroad. She will also be able to give him a lesson upon deprecia- tion, in a way, which, perhaps, will make the thing comprehensible even to him. PAPER AGAINST GOLD. 79 LETTER VI. " It is not altogether improbable, that, when the nation becomes he of its Debts, and is cruelly oppressed by them, some daring projector may arise with visionary schemes for their discharge; and, as public credit will begin, by that time, to be a little frail, the least touch will destroy it ; and in this manner it will die of the Doctor. But, it is more probable, that the breach of national faith will be the necessary effect of wars, defeats, misfortunes, and public calamities, or even, perhaps, of victories and con- quests." HUME on Public Credit. Saying that a Man writes from a Prison is not a satisfactory Refutation of his Argument Proceed with the subject of the Sinking Fund Alleged grounds of Addington's Act in 1802 The time when it was to hegin to yield" us Relief, to wit, 45 years Mr. Brand's Answer to an Argument of mine He denies that interest is paid upon the Redeemed Stock Acts of Parliament and Public Accounts say the contrary Examination of the Example stated by Mr. Brand Great Error in regarding things as alike which are essen- tially dissimilar in their properties Consequence of this error shown in the supposed case of Thrifty Grand Fal- lacy in supposing that what we pay to support the Sinking Fund, would otherwise be of no use to us Conclusion of the subject of the Sinking Fund P. S. Mr. Randall Jackson's Speech at the Bank Company's House, in Threadneedle Street. GENTLEMEN, IT was naturally to be expected, that those venal men, who, for want of industry to " labour with their hands the thing that is good," and from a desire to live upon the labour of others, have chosen the oc- cupation of writing, 'instead of obeying the voice of nature, which bade them use the brush and not the pen, to blacken shoes and not paper ; it was natu- rally to be expected that those venal men, who gain their .livelihood by serving the corrupt and by de- ceiving the weak, and the number of whom, in this Town, is, unfortunately, but too great ; it was na- turally to be expected that this description of men would feel alarmed at the progress of these Letters, which, by making honest and useful truths so fami- 80 PAPER AGAINST GOLD. liar to the minds of the people, threatened literary venality with destruction. Accordingly these in- struments of Corruption have shown their anger and resentment against me ; but, the only answer they have offered to me is this : " that I discharge my gun from a stone-battery ;" meaning that I write from a prison ; therein giving the public a specimen of their wit as well as of their manliness. This is al- ways the way ; it is the constant practice of those, who, while they are, from whatever motive, impelled to oppose a writer, want either the materials or the ability to show that he is wrong ; and, Gentlemen, you may lay it down as a maxim, that when any pub- lication is answered by abuse, and especially per- sonal abuse, the author of such publication is right, or, at least, that his abusers want the ability to show that he is wrong. Facts and reasoning, if erroneous, always admit of refutation : but, if correct, no one can refute them ; and, if erroneous, to refute may still require some ability ; whereas, to abuse the per- son from whom they have proceeded is within the power of every one, a gift not denied to any creature capable of uttering articulate sounds or of making marks upon paper. The great cause, however, of abuse in such cases, is the 'Weight of the truths against which such abuse is opposed : for it is here as in common verbal disputes, he who has the truth clearly on his side, is always seen to be in good tem- per, while his opponent scarcely ever fails to disco- ver impatience and anger, and, in but too many cases, to give way to personal invective and false ac- cusation ; and, be you well assured, Gentlemen, that even the venal men, above-described, answer me by saying that I write from a prison, only because they have no other answer to give. Leaving them in the full possession and unenvied enjoyment of all the advantage and of all the honour which such a mode of answering can give, let us proceed witli our inquiry into the effects of the SINKING FUND, just casting our eye back first, PAPER AGAINST GOLD. 81 and refreshing our memory as to the foregoing facts ; namely, that the Sinking- Fund Acts of PITT, which provided for the cutting off some part of the interest upon the Debt in 1808 ; that these provisions, which led the poor nation to hope for a taking off of part of its taxes in 1808 ; that these provisions, which, as we have seen, were held forth to the believing peo- ple of England, in the pamphlet of GEORGE ROSE, as the sure and undoubted pledge for the taking off of taxes in 1808, or thereabouts ; that these provisions, in order to begin to taste the benefit of which, the people were to pay a million a year of additional taxes for twenty-two years ; that these provisions, yes, we must bear in mind that these provisions, after the people had gone on hoping for sixteen years out of the twenty-two ; that these provisions, were, by ADDINGTON'S Act of 1802, repealed, done away, made of no more effect than if they never had been enacted by the Parliament. " Well," you will say, " but upcn what ground was this measure adopted ? What end was it pro- posed to answer ?" Oh ! why 'it was to pay off the Debt, new as well as old ; for, by this time, the Debt contracted since the existence of the Sinking Fund, was become greater than the one contracted before. It was to pay off the Debt, new as well as old, sooner than they would have been paid off, if this New Act had not been passed. And it was said, in support of the measure, that it would be better for us (good God, what a " thinking" people we are !) not to have any of our taxes taken off in 1808 ; but to go on paying interest upon the whole of the Debt, as before, till our Sinking Fund Commissioners had bought up the whole of the Stock, and that, then, (Oh, then !) then, my boys, huzza ! for, then we should be completely out of Debt. " Thinking people" of England, when do you think that that then was to arrive ? When do you think that it was supposed that our Commissioners would have bought up the whole of the Stock existing when 82 PAPER AGAINST GOLD. the new Act was passed ? When do you think that the day, the happy day, the new day of promise was to come ? When do you think we were, according to this Act for rendering the Sinking Fund " MORE EFFECTUAL ;" when, aye, when do you think, that we were, according to this improved plan, to begin to feel the effects of it, in the lessening of our taxes 1 How many years do you think we were to wait ; how many years to keep paying additional taxes for the purpose of paying off the Debt, before we began to taste of any redemption of Taxes in consequence of it ? Only FORTY-FIVE ! Forty-five years only had we to wait; and now we have only THIRTY- NINE to wait, and to pay taxes all the time, over and above the interest upon the Debt ; only thirty- nine years before we shall cease to pay interest upon the whole of the Debt existing in 1802 ; about five- eighths of the Debt, now existing. We have been waiting ever since the year 1786 ; we have been wait- ing for twenty-four years ; we have been pay- ing taxes all that time, over and above the interest of the Debt ; we have, for twenty-four years, been paying taxes for the purpose of paying off the Debt ; and, now, at the end of these twenty-four years, those of us who are alive have the consolation to reflect, that we have only thirty-nine years more to wait and to pay these Sinking- Fund taxes, before we shall begin to taste the fruit of all this patience and all these sacrifices, and that, at the blessed time here mentioned, some of our taxes will be taken off .... unless another Act should be passed, between this time and that, for rendering the last made Act MORE EFFECTUAL." Gentlemen, need I say more ? Certainly it is not necessary ; but, there are still some views to take of this matter, which having taken, we may defy all the world to puzzle us upon this subject again. We have seen, that we still pay interest upon 'he whole of the Debt ; we have seen, in Letter IV. j. 64 ; that since the Sinking Fund was established^ PAPER AGAINST GOLD. 83 the interest we pay has increased from nine millions and upwards to thirty-two millions and upwards : and we humbly think, at least I do, that so long as I am compelled to pay interest for a Debt, it is no matter to whom, or under what name, I pay it. This is an obvious truth. There is something so consummately ridiculous in the idea of a nation's getting money by paying interest to itself upon its own stock, that the mind of every rational man naturally rejects it. It is, really, something little short of madness to suppose, that a nation can increase its wealth ; increase its means of paying others ; that it can do this by pay- ing interest to itself. When time is taken to reflect, no rational man will attempt to maintain a proposition so shockingly absurd. I put the thing in this way in an Article, published by me in 1804,* and I re- quested the late Rev. JOHN BRAND, who had written a great deal upon the subject, to look at the Article, and to tell me what sort of answer he could find to this part of it. He did so, and the following was his answer : " I have looked at your observations on the Sink- ing Fund ; and the following is my answer to your great argument ; namely, ( that the Debt said to be redeemed is an imaginary discharge, because IN- TEREST thereon continues to be paid.'' If the interest does continue to be paid, the conclusion is just ; and this is the fundamental principle of much of what you have said. It is reduced, therefore, to a question of fact, and I should say the interest does not continue to be paid. The same tax con- tinues to be levied, it is paid also away, but it is paid for another purpose ; it is yearly applied to the pay- ing off more principal ; no part of it is applied to the payment of interest. Take an example in a private concern : A. has on his estate a mortgage of 70,000 at 3 per cent., which he has the liberty to pay oft* as he pleases. He determines to diminish * REGISTER, vol. v. page 591. 84 PAPER AGAINST GOLD. his expenditure by 1,OOOZ. a year; at the end of the year he pays the interest 2,100Z., and part of the prin- cipal 1,000/. ; his payment that year is 3,100/., and this sum he continues to pay annually till the debt is annihilated ; it is now reduced to 69,000/. ; at the end of the second year there will be due for interest 2,070., being 30/. less than the year before ; when, therefore, the second payment of 3,100/. is made, it will consist of two parts, 1,030/. for principal, and 2,070/. for interest. The interest of the 1,000/. paid off the first year does not continue to be paid in the second, and the 30Z. interest of the part of the capital redeemed or paid off is now applied to the payment of more capital. Such mortgagor at the end of the year has actually paid off 1,000/., of year two 2,030Z., and of year three 3,060Z. 18*. And that he continues to pay annually the same sum on ac- count of debt, that is, on account of principal and in- terest jointly, does not in the least affect this con- clusion." Now, in the first place, you s-ee, Mr. BRAND takes up " a new position" as most combatants do, when they are afraid to meet their antagonist. He is obliged to say, that we DO NOT continue to pay interest upon the part of the Debt, which is bought up, or, as it is called, redeemed. Aye ! but what say the Acts of Parliament ? They say, that in- terest is continued to be paid thereon : they say, that, when any Stock, or parts of the Debt, are bougkt up, or redeemed, by the Commissioners, " the divi- dends thereon shall be received by the said Com- missioners" or by the Bank, on their account. And, what is the language of the Accounts, laid before Parliament ? Why, in the account of the nation's Expenditure of last year, there is the following item : " INTEREST on Debt of Great Britain RE- DEEMED, 4,443,519/." So that, either the Acts of Parliament and the Public Accounts make use of misnomers, or, I was right in calling it interest. Besides, how completely does this denial of Mr. PAPER AGAINST GOLD. 85 BRAND dissipate all our fine dreams about the gains of the Sinking Fund ? Is it not the commonly re- ceived notion, that we gain money by this Fund? Are we not continually told, by the venal writers of the day, about what the Fund yields ? Were we not told by them, less than six weeks ago, that this Fund had produced such and such sums ? And, what is meant by a Fund's yielding and producing, if you cast the notion of interest aside ? In what other way is it to yield ? In what other way can it produce an addition to its amount? Yet, on the other hand, it is impossible to adhere to this notion of interest, without falling into the gross absurdity, before mentioned, of supposing that the nation can get money ; that it can increase its means of pay- ing others, by paying interest to itself, by becoming the lender of money to itself, by becoming its own creditor ; an absurdity, which, as we have seen, Mr. BRAND dared not risk his reputation in attempt- ing to support. We now come to Mr. BRAND'S " example in a pri- vate concern." And here, Gentlemen, suffer me once more, and in a more pressing manner than be- fore, to solicit your attention ; because we have now before us the ground-work of all the sad delusion, which has so long existed, and which does still exist, upon this subject. It is a natural propensity of the mind of man, to assimilate things, which he wishes to understand, with things which he does understand. Hence the application of the terms mortgage, redemption, and others, to the Debt of the Nation. But, in this work of assimilation, or bringing things to a resemblance for the purposes of illustration, we ought to take the greatest care, not to make use of violence, not to regard as alike things which are essentially different in their properties ; for, if we do this, error must be the result, and I think, you will find, that this has been done by all those, who have reasoned like Mr. BRAND ; that is to say, the 8 86 PAPER AGAINST GOLD. whole of those writers and speakers, who have held forth the Sinking Fund as likely to produce relief to the country. We know, we daily see, that private persons pay off incumbrances upon their estates ; and, we know very well and very familiarly, how fast the money of private persons increases by being' permitted to lie at compound interest. This very common portion of knowledge appears to have been quite enough for our Financiers, who had, therefore, nothing to do but to look into interest tables^ where they would not fail to find, that a million a year set apart, in 1786, would, at compound interest, pay off the then existing Debt, in the space of sixty years from that time. They ask no more. This quite satisfies them. They have no doubts upon the subject; and, accord- ingly, they set apart the million a year, that is to say, they make a law for applying, as we have seen, a million a year of taxes, raised upon the nation, to the paying of the nation's Debts. But, where is the real similarity between this proceeding and the pro- ceeding of the individual as supposed by Mr. Brand, Mr. M'Arthur, Mr. Pitt, and others ; for they have all made use of the same sort of illustration ? Where is the similarity in the cases ? Mr. BRAND'S individual, to whom, for the sake of clearness, we will give the name of THRIFTY, dimin- ishes his expenditure by a thousand a year ; that is, he, instead of spending it upon beer, wine, bread, beef, and servants, pays it annually to GOLDHAIR, who has the mortgage upon his estate. Now, this you will clearly see, is to be a thousand a year SAVED by THRIFTY ; and, besides this, he resolves to pay to GOLDHAIR, (who has the mortgage on the estate, mind,) as much more every year as will make each payment equal to what he formerly paid on account of the interest of the whole debt. This is an odd sort of way to do the thing, but it is THRIFTY'S humour, and there can be no doubt, that, in time, he will thus pay off his mortgage. But again, I ask. PAPER AGAINST GOLD. 87 what similarity there is in the case of THRIFTY and the case of a NATION ? THRIFTY, we are told, "determines to diminish his expenditure." Can a NATION do this ? THRIFTY knows to a certainty what his income and what his expenditure will be; the former infixed, and over the latter he has complete control. Is this the case with a NATION? Prudent THRIFTY does not, and, indeed, the supposition will not let him, contract a debt with SILVERLOCKS, while he is clearing off with GOLDHAIR. Is this the case with a NATION ? But suppose, for argument's sake, that, as to all these, there is a perfect similarity ; still is there a point of dissimilarity, which nothing can remove. THRIFTY, we are told, SAVES a thousand pounds a year. How does the saving arise ? Why, he has less beer, wine, bread, beef, and servants, than he had before. His saving, then, is made from the brewer, the wine- merchant, the baker, the butcher, and the footmen ; or, rather, it is made from the public ; it is made from the nation ; it is made from a third party. But where is the NATION to find a third party from whom to make its saving ? But, what we are now going to view is the GRAND FALLACY. In this case of THRIFTY, it is supposed, that he makes retrenchments from use- less expenses ; that " he determines to diminish his expenses by a thousand a year," and that, what he WASTED before, what HE GOT NOTHING BY THE USE OF BEFORE, he now applies to the paying off of his mortgage. This is very rational, and Very efficient it would be ; but, is this the case with a NATION ? Would the money which is collect- ed from the people in taj?es, for the purpose of sup- porting the Sinking Fund, be wasted, if not collected from them ? Would it be squandered away by the several individuals who pay it, in the same manner that THRIFTY ; S thousand a year is supposed to have been wasted, before he began the work of redemp- tion ? Would it, in short, be of no advantage to 88 PAPER AGAINST GOLD. them, if it were not taken away to be given to the Sinking Fund ? Oh, yes ! And it would produce a compound interest, too, in the hands of individuals, as well as in the hands of the Sinking Fund Com- missioners. What has the nation gained, then, by paying millions to Commissioners, instead of keep- ing those millions in their own hands ? SINCE THE YEAR 1786, THE NATION HAS PAID UPWARDS OF 160 MILLIONS INTO THE HANDS OF THE SINKING FUND COMMIS- SIONERS ; that is to say, so much money has been collected from the people in taxes for the pur- pose of redeeming Debt; and, if this sum had been left in the people's hands, would it have been of no use to them ? Would it not, at any rate, have helped to prevent the Debt, since that time, from being AUGMENTED IN THE SUM OF 600 MIL- LIONS. Let us give the thing one more turn, and then, ic is, I think, hard, if we may not safely quit it for ever. THRIFTY is supposed to take his thousand a year out of what he before wasted ; out of his superflui- ties. But does our Sinking Fund money ; do the tax- es that we pay towards the Sinking Fund, come out of our superfluities? And, why suppose that THRIFTY wasted any money before ? Why suppose that he had any money to waste? Is THRIFTY 's being in debt, and having his estate encumbered are these reasons sufficient for concluding, that he had it in his power to "determine to diminishhis expenses?" Are they not rather reasons sufficient for concluding, that he was in circumstances of distress ? Yes ; and if, when we have come to that rational conclusion, we suppose him persuaded to believe, that he will get out of debt by borrowing from SILVERLOCKS all the money that he pays off with GOLDHAIR, and loading his estate with a new mortgage, with the addition of the cost of bonds and fees, then we shall have before our eyes " an example in a private PAPER AGAINST GOLD. 89 concern," pretty well calculated to illustrate the cele- brated scheme, which we have now been discussing 1 , and of which I now flatter myself that a single word more need never be uttered to any man of only common sense. I am, Gentlemen, Your faithful Friend, WM. COBBETT. State Prison, Newgate, Thursday, 20th Sept. 1810. P. S. FRIDAY, 21st SEPT. I have just seen, m the public prints, a report of a speech, said to have been delivered yesterday at the Bank Company's House, in Threadneedle-street, by Mr. RANDALL JACK- SON. I shall not, as I said before, suffer any publi- cations of the day to interrupt the course of my dis- cussion. In my next LETTER, which will open the way to that memorable transaction, the Stoppage of Gold and Silver payments at the Bank of Eng- land, I shall, in all likelihood, have occasion to no- tice Mr. JACKSON'S speech, not so much on its own account, as because it appears to have been highly ap- plauded by the people at the head of the Bank Com- pany, for whom, perhaps, Mr. JACKSON, who, it seems is a lawyer, made it in the way of his profession. One word, however, I must beg leave to add upon the part of this Gentleman's speech, in which, as the re- porter says, he alluded to me, as one who had exulted at the appearance of the Bullion Report, because that report, coming from such high authority, had put the stamp of correctness on my opinions. Never did I say this ; never did I think this. Never did I look upon the Bullion Committee as a high authority ; and, meanly indeed should I think of myself, if I thought any thing, that they could say or do, capable of adding the smallest weight to my opinions. No : what I exulted at was, that my principles and doctrines, as to paper- money, had, at last, produced practical effect, a proof of which was contained in 8* 90 PAPER AGAINST GOLD. the Bullion Report ; and that, it was now more likely than before, that such measures would, in time, be adopted, as would be likely to secure the country from the natural consequences of that over- whelming CORRUPTION, and that want of love for the real Constitution, which I regard as the fruit of the Paper-money System, and which, years ago, I proved, as I think, to have proceeded, in great part, from that poisonous and all-degrading root. This was the cause of my exultation. I looked upon the Bullion Report as tending to this great object ; and, as I prefer the accomplishment of this object, as I look upon ihe happiness and honour of my country as of far ^:vairr value tome than any other worldly possession, I said, and 1 still say, that the Bullion Keport has given me more pleasure than I should derive from being made the owner of the whole of Hampshire. As for any idea of a party nature, I shall, I am sure, be believed when I say, that 1 did not care one straw to what party the Committee be- longed. If I had a wish as to party it certainly would be, that no change of ministry should take place; for, (without prejudice to the OUTS, who, 1 think, would do the thing full as well with a little more time,) I am <juite satisfied, that the present men will do it as neatly and as quickly as< any rea- sonable man can expect. PAI'KIl AOAIN8T GOLD. 01 LKTTER VII. "RKAL MONIW ran hardly <-v<:r multiply I"., mii'-h in nny n.in.l.y. buciuine H will tilwayf. 01 ITHH-M-IMI-H, in; tlw certain ti&n <>/ '//" ///<-/ >.-< of TRADE, ofwlnrh it. 1.4 tin- iii--;i iure, .m<! <,,!,... -iH'Miily -.1 ili- noundnuM nnil vi;;.)u, oflli'- wlniln U'l y. I'.nl l! i )\i;V mny, :iml ilo.-n WllllDill. flliy Ilirn-.-i .,1 Tr.-uli: . liny, olli-ll v.'lini Tl.uli- ,-n-fil|y iii-r.lin.-i, rot; rr is NOT Tin: MI; A si in i; OF TIM; TK ADI; oi- 1 rr. \ NATION, HUT OK THE N I,' :i-;.-..-,lTY OF MS (JOVKKNMKNT ; MIH! 1 1 i . :il> i r (I inn! mil il In' i H i n a in, licit, tin- s;mn: rniHC wliu'li nn I ur.i II / lh<- wr.althnfn Nntioii. Hlioill'l lil.i-wir.i: lc MH-. (inly jnnduCliva cause <if money." UUJlk K. Review "f flic ( Jr^uinl over wliirh we lin vr pn:; ,;r d in i!i- forr,-- l.i-i.i/-rs OJH-IIIII;; iln: w;y info rhc IIiMory of tlur r>;uik':t Sli>|ip;i;v: in l/iy Va^uc !\olioii ;i!)nnt tin- h (I r,:inl: i\otcs licni:' :i I'-'ti <>\ :ui I IMT< -i; J ,c of TiJi'lc. nii'i Wcallli, ;iiul Prosperity; 'rhii Notion <-,x;iiiiiin-<l Mi. K.;in- rlall Jackson's &p 'iiin;- ;i";nn.,l. llioxc who liav; reCOimnended that. In: ami IMM I'arlm-i.i :,h;.ll In: comprlli d to I'ay ihcif I'loini , 01 / i\oli s in two Yrai: lh:i iNolion t!i;:t an lnrir-;i:c i>\ |',-ink NoM-i naluially an;,i:-i Itoin ;m In- c.r:asc o| 'I'ca'l'- \lu c hf-api-d upon those who wi:.h lh<: I'.ank lo pay it:; Nulrn Such I'et :-.ons ealh-.j |{ ill, CH, mid oy llij Credit of Old iMi-land A n I ncrease of l'i'-. .te-; i.; a I'ro'.l'ol an In ol I). ,ni. l-'ive Way 1 in which I',ank A'oie.t -el oiil into cir- culation Absurdity of 'hat. an Jncn-a.eol I'fo tin 'i to pay ' re a Si-li ol' an increase of" the ,\l< J'ayinx N. I'.. An Account, of the I )r,n , Irorrj tho I''ailure of llir; llankn at Salinhury and ,Shaite:,hui y. i U:MI:N, I-,- i.l e fore^oin^ L-n-r, w: closed relative lo the Hi.n/rin'; l''iuul, ;ind that biou'^ht us to a point, to a sort of stage. OJ our vv;iy, I'rain vvlii-h jxjint it will he ;idv;mt;it;eou^ for us lo fake ;L brirl' r-vi<-vv ol' the ground over wlii'-J) we; l:tve pus.sed ; for, \vlidi tin- <!-xi';n of (he writer is to serve the c.:ui:;e of ///////., and < .[H-einlly when !.!n- truth', he. wi:- Jiev. lo n:ike ;ij|);in-nl, have h'-en Indoftriously env'-lopcd iti d;nkn-ss; in such a Case, every other (juality in wiiliri", <>\:-\\il to yi-ld to that of rl. a r ness. 92 PAPER AGAINST GOLD. It was stated, at the outset of our inquiries, that the chief object of them was, to ascertain, or, at least, to enable ourselves to form a decided opinion, " whether it be possible, without a total destruc- tion of all the paper-money ', to restore Gold and Silver to circulation amongst us" In pursuit of this object, it became necessary for us to make some preliminary inquiries as to the cause of the Gold and Silver having gone out of circulation. The cause, the immediate cause, that is to say, the cause which came close before the effect, was the increase of the paper-money. This cause was evi- dent to every one ; but, then, it became us to inquire what had been the cause of that increase ; other- wise our inquiries would have been as useless as would be those of a farmer, who, upon finding a score of his sheep dead, should content himself with ascertaining that they had been killed with a knife, without making any inquiry as to the person by whom the destructive instrument had been used. Common sense, therefore, dictated to us to inquire into the cause, or causes, of the increase of the paper-money ; and, in order to come at a clear understanding with respect to these causes, we were obliged to go back to the inauspicious origin of the paper-money system, that fatal system, whence arose the National Debt, that Debt which even PITT himself, the great abettor of the system, called " the best ally of France." During this retrospect, we have seen, that the Bank of England is merely a company of traders, whose charter arose out of a loan which they made to the Government, and that, at its institution, it never entered into the mind of man, that these tra- ders were ever to be protected by law from paying, in the king's coin, their promissory notes, as they have been from February, 1797, to the present day. We have seen, in proceeding to inquire into the cause of this nonpayment or stoppage, on the part of the Bank ; in 1797, that the bank notes have gone on in- PAPER AGAINST GOLD. 93 creasing in quantity, and that these notes, of which, for more than half a century, there were none under 20 pounds, appeared, in the war of 1755. in the shape of 15 pounds and 10 pounds ; and, during PITT'S war against the French revolution, which war he carried on, in part at least, for the avowed purpose of de- stroying the finances of France, we have seen that they appeared in the shape, first, of 5 pounds, and, at last, in the shape of 2 pounds and I pound. We have, in order the better to understand the history of the Bank Stoppage, in 1797, and the better to esti- mate its consequences, taken a view of the Funds, and Stocks, and National Debt ; we have seen how they arose ; we have described their nature ; we have traced them in their dreadful progress ; we have seen how the National Debt has gone on increasing from the reign of William the Third to the present day ; we have seen how exactly the increase of the National Expenditure, and the Taxes, and the Poor- Rates, have kept pace with the increase of the Debt ; and, in the three last Letters, we have seen an ample development, a clear exposure, of the schemes for "redeeming," or "paying off," that Debt, and we have seen, that during the operation of those schemes of redemption, the Debt has gone OD? increasing, and, that the interest we pay upon the Debt, has, since the Grand Scheme of PITT has been in force, been aug- mented from 9 millions a year to 32 millions a year. This is what we have seen and what we have done. And having now, to use the sportsman's lan- guage, made good our ground, we may begin to move forwards towards the interesting history of the stop- page of gold and silver payments at the Bank of England, in 1797. Our first step, in opening the way into this history, must be to obtain a clear notion with regard to the manner in which bank notes are issued, or put out into circulation among the people ; or, rather, with regard to the immediate causes of putting them out. For, unless we have a clear understanding upon this 94 PAPER AGAINST GOLD. point, we shall have hut a confused idea of the more distant causes of their increase. There is, apparently, a vague, or indistinct notion, floating in the minds of some men, that the increase of the bank notes is an indication, or sign, of an in- crease of TRADE, of WEALTH, and of PROSPERITY, which, as you must have perceived, are, by such persons, always jumbled and confounded together, for want of proper attention to the facts and princi- ples, which we have stated and laid uown in Letter III., from page 40 to page 54. But, we must not suffer ourselves to fall into this confusion ; and, in- deed, does not common sense reject the notion, that an increase of promissory notes, which necessarily argues the want of the means of the person issuing them, to pay in specie ; does not common sense, does not the plain understanding of every plain man re- ject, with scorn, the notion, that such an increase is a sign of increasing wealth and prosperity in the person, or body, or community, by whom the issue is made ? Why does our neighbour NEEDY give a note ol hand in payment of his rent or of his tailor's bill ? Why, because he has not the money in his pocket or his drawer. And, are we to be made to believe, that the circumstance of his not having money to pay what he owes is a proof of his wealth and prosperity ? We have been persuaded to believe many things ; but, I think, that, at this day, we shall not be persuaded to believe this. At the time of the numerous bankruptcies, in 1793, just after PITT'S war broke out, PITT asserted, that they were a sign of national prosperity, and was al- most huzzaed for the assertion ; but, we have had time now to experience, time to feel, the worth of PITT'S assertions, predictions, plans, and measures ; and, with the benefit of this lesson, we shall not, now, be so easily persuaded, that bankruptcy is a sign of prosperity ; though, it must, I think, be allowed, that it is full as true a sign of prosperity as that which has now been discovered in the increase ofpromis- PAPER AGAINST GOLD. 95 xorj/ notes, which increase is, and must be, always an infallible sign of a want, in a greater or a less de- gree, of the means to make payment in money. As to the increase of Trade, that, indeed, will demand, as we shall hereafter more fully see, a cer- lain increase of circulating medium, or money, as must be evident to every man, who reflects, but for one moment, upon the subject ; because, where there are ten purchases of a pound each to be made, (sup- posing them to be made in the same space of time,) twice as much money will be wanted as where there are only five purchases of a pound each to be made. But, the increase of trade, that is to say, the increase of purchases and sales, or, in other words, the in- crease of MONEY'S-WORTH things, though it is a very solid reason for the increase of money, is no reason at all for the increase of promissory notes, and, especially, of promissory notes which will not bring money in exchange for them. The man, who is in a great way of trade, gives more promis- sory notes than a man in a small way ; but he has proportionate means, and, at any rate, does not give notes without possessing the value of them in goods, or property of some kind, in moneys-worth things ; and, of course, his notes are convertible into money ; but is this the case with the notes of the Bank ? Is this the case with the notes of any of our Banks ? Such a man stands in need of no law to protect him against the demands of the holder of his notes ; but there is a law to protect the Bank of England against the demand of any holder of its notes, who may wish to have guineas in exchange for those notes. And, can the increase of such notes be regarded as a sign of the increase of trade ? Yet this is a favourite fallacy with those, who either do not understand the matter, or who, while they do understand it, wish to deceive the world, and the people of this country in particular. This same fallacy was put forth with great assurance, at the House of the Bank, in Threadneedle-Street, 96 PAPER AGAINST GOLD. London, no longer ago than last Friday, by the Gen- tleman, a Mr. RANDALL JACKSON, mentioned in the Postscript to the last Letter, page 89, 90, in a speech, the whole of which (together with the speeches of the GOVERNOR OF THE BANK and of a Mr. PAYN, a coun- try Banker) as reported in the Morning Chronicle of Saturday last, will he found in the APPENDIX, A., and which I beg leave to recommend to your atten- tive perusal. Mr. JACKSON, who is, it would seem, a proprietor of Bank Stock ; that is to say, one of the Bank Com- pany, that is to say, one of the persons in whose names the bank notes are issued ; that is to say, one of the persons who put forth the promissory notes of the Bank ; that is to say, one of the persons who de- rive a profit, who get rich, from the putting out of those notes ; Mr. JACKSON most loudly inveighs against the Bullion Committee, and, indeed, pretty roundly abuses them ; pretty roundly abuses a Com- mittee of the House of Commons, for having recom- mended to the House to pass a law to oblige him and his partners to pay their notes agreeably to promise ; and this he does, you will observe, at the very time that he is railing against the revolutionists of France, for their levelling principles^ and, insi- nuating, that there are such levellers now at work in England ; all which may be very natural in Mr. JACK- SON ; for, who that is protected by law from the pay- ment of his promissory notes, would wish that law to be repealed, and its place supplied by a law to compel him to pay ? It may be very natural for a gentle- man, so situated, to abuse the Committee; but, it would be very foolish in the people ; very foolish in the holders of his notes ; very foolish in his creditors to join in such abuse. Upon this part of his speech, however, we shall find a more suitable place for ex- tending our remarks, and also for noticing what he said about the vast increase of the Country Banks, without seeming to perceive, that that increase has been owing solely to the law which protected, and still protects, PAPER AGAINST GOLD. 97 the Bank of England against the Gold and Silver demands of its creditors. Upon these parts of his speech, and upon his assertions respecting a debt said to be due to the Bank from the public ; upon his statement of the causes of the Bank stoppage ; upon the wonderful unanimity of all the speakers at this Meeting of the partners of the Bank Com- pany, in declaring, that there would be NO GOOD in their paying off their promissory notes in Gold and Silver ; upon all these topics, and upon some others, brought forward at the Bank Company's Meeting, we shall find, hereafter, a more suitable op- portunity for making and apply ing our remarks, which, indeed, belong to other parts of our subject, and, there- fore, we will, at present, confine ourselves to the only topic introduced into these speeches, which belongs to the part of our subject now immediately before us ; namely, the notion, that the increase of bank notes naturally arises from an increase of trade. Since, however, I have digressed so far, I take the liberty to continue on a little further for the purpose of noticing a paragraph, in a newspaper of this very morning, (Monday. 24th September,) which imitates Mr. JACKSON in abusing those, who are desirous of seeing the Bank Company once more pay their promissory notes in Gold and Silver. " We are happy," says this writer, " to find, that the opinion we have more than once expressed upon the subject is sanctioned by the first authorities in the Country, and that the mischievous idea of throwing open the Bank immediately to be rijled by the en- grossers and exporters of guineas, is universally reprobated. Sir John Sinclair has taken up the pen upon the subject, and most ably does he treat it. Neither the authority of the Committee, nor the cla- mours of those who wish to destroy the public cre- dtt of Old England, have been sufficient to intimi- date that highly informed and much respected Gen- tleman from coining forward to vindicate truth and dispel a most mischievous delusion" What, Gen- 9 PAPER AGAINST GOLD. tlemen ! is a recommendation to pass a law to oblige the Bank Company to begin to pay its promissory notes in gold and silver, at the end of two years ; is this to be called " throwing" open" the Bank to be " rifled ?" Are you and all of us, who hold bank notes, to be denominated " rijlers," or robbers, because we may wish to be paid the amount of those notes in gold and silver ? Is a desire to see the Bank pay its pro- missory notes upon demand, agreeably to the words written in them, and to see the king's coin once more come back into circulation amongst us ; is this desire to be attributed to a " wish to destroy the public cre- dit of Old England?" Gentlemen, this language shows two things : first, that those who use it enter- tain a most hearty contempt for the people of Eng- land ; and, second, that their cause is so very bad, that they dare not even attempt to offer in support of it any thing bearing the shape of an argument. Leaving the Bank Company to the support of these railers, let us now, with the calmness and candour which belong to the cause of truth, return to our inquiry, whether the increase of the bank notes has arisen from an increase of trade, and if not, what has been the real cause, or causes, of that increase of bank notes which has driven the gold and silver out of circulation. We have seen, that a real increase of trade means, an increase in purchases and sales, or, in other words, an increase in commodities, or things, which are really worth money. Consequently, an increase of trade will naturally demand an increase of money ; but, what it demands is an increase of real money, seeing that the increase of the trade itself is no other than an increase of money's-worth things ; and, that the increase of its demand will not be for paper, or for notes not convertible into money. Precisely the contrary ; and, in private concerns, we every day see, that it is the falling o^of a man's real trade, it is the lessening of his quantity of money's-wortli things, that induces him to have recourse to the is- PAPER AGAINST GOLD. 99 sue of paper, paper which he cannot turn into money. In a word, it is DEBT that makes a man give pro- missory notes. An increase of trade, always imply- ing an increase of money's-worth things, brings, of itself, an increase of real money, unless that money be, by some unnatural cause, withheld from circula- tion. It is just the same with a nation, whose in- crease of money's-worth things will bring to it an exactly proportionate increase of real money, if that money be not kept back, or driven out again, by some unnatural cause ; but, DEBT, and the attendants upon debt, lead to the issuing of bank-notes, or, to paper of some sort or other, or, to a something, no matter what it be, which has not a real value in itself. Real money is the representative of MONEY'S WORTH THINGS; promissory notes are the re- presentatives of DEBT ; and, this we shall clearly see, as we proceed in examining into the way, or rather the divers ways, in which bank notes get out into circulation amongst the people. The bank notes have in them nothing of a mys- tical nature. They are the joint work of a paper- maker, an engraver, a printer, and the person who puts his name, in writing, at the bottom of them. Being thus brought to perfection, they are delivered at the Bank Company's House, or Shop, FIKST, to any persons, to whom the Company may owe money, for work done to their buildings, or to others for keeping their books, or for paper, or for printing, or, in short, for any services performed for them. A SECOND way, in which the notes get out, is through what is called discounting ; that is to say, loans of bank notes made to private persons, for which the borrower leaves in possession of the Company a note of hand or bill of exchange, that is to say, an en- gagement to pay back again as much as he receives, together with interest for the time ; or, rather, the interest is deducted when the loan is made. A THIRD way, in which the notes get out, is through the advances, or loans, which the Bank makes to the 100 PAPER AGAINST GOLD. Government, by way of anticipation upon the taxes, before they come in. A FOURTH way is through the payment of the interest of Exchequer Bills, or Navy Bills, which are a sort of promissory notes, given by the Government, and upon which the Bank some- times pays the interest, and, at other times, discounts them, or purchases them of the holders at the cur- rent price ; but, in every case, a fresh parcel of bank notes gets, through the means of these bills, into cir- culation. A FIFTH way, in which the notes get out, is through the payment of the dividends, or the in- terest of the Stock, or National Debt, which divi- dends are paid quarterly ; and, as we have before seen, the amount is three times as great as it was at the beginning of PITT'S war against the Jacobins of France, which we have called the ANTI-JACOBIN war. Now, without enumerating any more of the ways in which bank notes get into circulation, is it not as clear as the sun at noon-day, that they are always the representatives q/DEBT ? Is it not a fact that no one can deny, that the increase of them proceeds from the increase of Debt, and not from the in- crease of trade? Away, then, with the nonsense of those dreamers, who would persuade us that an issue of promissory notes proceeds from an increase of moneys-worth things ! Away with the idle talk about an increase of things of real value calling for an increase of paper promises ! Away, away with the confused, the childish notion, that an increase of the means of paying, produces an increase of promises to pay ! As well might any one tell you, that the increase of the paper of the Salisbury* and * The scenes at SALISBURY, on account of the failure of the Banks at that city and at Shaftesbury. have been truly dis- tressing. At Salisbury, in particular, where the greatest part of the sufferers live, the poor people were, in many cases, without victuals or drink for some time, and many persons, in a respectable way of life, were, for many days together, obliged to sit down to dine upon little more than bread, no meat being to be purchased with the only sort of money (if a debased paper ought, for a moment, to go by that name) which PAPER AGAINST GOLD. 101 Shaftesbury banks arose from the increase of the means of paying their debts, an assertion, which, was, generally speaking, in possession of the people. Many persons, in the lower ranks of life, who had gathered together a few pounds, the fruit of long labour and anxious care, of frugality, and of forbearance frorn enjoyment; the fruit, in short, of an exercise of all the domestic virtues, and destined to be the provision, as the saying is, "against a rainy day," that is, to be the source of comfort in sickness or in old age; many persons of this description, the heart-ache of one of whom ought to give us more pain than to see fifty thousand Public Robbers swinging from so many gibbets ; many per- sons of this description ; many of these very best of the peo- ple, saw their little all vanish in a moment, and themselves reduced to the same state with the improvident, the careless, the lazy, the spendthrift, the drunkard, and the glutton, look- ing back upon a life of labour and of care, and looldng f9rward to the misery and disgrace of a workhouse ! To describe the scene, when the Meetings of Creditors took place, at Salis- bury, would be impossible. The Council Chamber of the city (for no other place, except the Cathedral, would have con- tained a twentieth part of them) was surrounded with such multitudes, and so eager were they, in pressing forward, that some were in danger of their lives ; and the constables, from necessity, perhaps, laid their staves about the heads of many of those who came to demand their due, particularly, as 1 arn informed, on the 7th of this month. What a scene was this ! Here, PITT, if he had still been alive, might have seen a speci- men of the fruits of his system ! The holders of the notes were, I understand, each of them compelled to be at the ex- ense of an affidavit, and obliged, also, to attend in person, or y an attorney, at the Meeting of Creditors, and also for the receipt of the dividends whenever any shall take place. It is easy, therefore, to conceive what portion of payment will ever fall to the lot of hundreds of poor men and women, living at a distance from Salisbury, and scattered about in country places, where a newspaper is hardly ever seen. One of the banks was called the Salisbury and Shaftesbury Bank, and part of the notes are dated at one place, and part at the other. Those notes, which were dated at the latter place, were to be proved at meetings to beheld there; so that, many of the poor fellows, who had brought their notes to Salisbury, were told, that they must carry them to Shaftcsbury, a place at twenty miles distance ! The holder of each note, was, I understand, compelled, in order to have a claim to any dividend, to swear that he had given the full value of the note ; so that, one man could not demand payment of the note of any other man ; and, people could not sell the notes for any thin? beloio their no- minal value. It is evident, that, under circumstances like these, a great portion of the poor people who hold any of these p b 102 PAPER AGAINST GOLD. with the present scenes before your eyes, might be a little more impudent, but not a whit more contrary to truth, than the assertion above noticed, and I trust, completely refuted. I am, Gentlemen, your faithful friend, WM. COBBETT. State Prison, Newgate, Monday, 24=th September, 1810. notes, will lose the whole amount of them. I have two men, for instance, who had the misfortune to be of this numher, James Gullingham and William Hurckett, the former of whom had a .five pound note, and the latter a one pound note, both issued under the name of Bowles, Ogden, and Wyndham, and both which notes I have now lying upon the table before me. These men are at twenty-eight miles distance from Salisbury; to present the notes at the Meeting would have required three days' absence from home in the midst of harvest, besides their expenses at Salisbury and upon the road, which, without the expense of the affidavit, would have amounted to more than the one pound note of Hurckett, to say nothing about the ex- penses attending the receipt of the dividends. Indeed, upon the circumstances being related to me, I was quite satisfied that any attempt of poor Gullingham to recover his debt from Messrs. Bowles, Ogden, and Wyndham, even supposing them to pay 20 shillings in the pound, would be a losing concern, and that the best way was for me to take the debt off their hands. I intend to s'end the pretty little bits of paper down to them, with a request, that they will paste them upon two little boards, and hang them up in their cottages, not only by way of ornament, but as a lesson to their neighbours and their children. I dare say, that there are many considerate mas- ters who will act in like manner; but it must be manifest to every one, that hundreds of poor families will suffer, and very severely suffer, from this one failure. What, then, must be the consequence, if these failures should become general ? and, does it not become every one, who wishes to see the peace and independence of the country preserved, to use his utmost endeavours to convince the public of the necessity of measures to restore to circulation the gold and silver coin, and thereby to prevent, if possible, those dreadful convulsions, in which the issue of a paper currency, not convertible into specie, have but too frequently, not to say, invariably, ended ? VAPER AGAINST GOLD. 103 LETTER VIII. That provisions and labour should become dear by the increase of trade andmoney is, in many respects, an inconvenience ; but an inconvenience that is unavoidable, and the effect of' that public wealth and prosperity which are the end of all our wishes. It is compensated by the advantages which we reap from the possession of those PRECIOUS METALS, and the weight which, they give the nation in all foreign wars and negotia- tions ; but there appears no reason for increasing that inconvenience by a, counterfeit money, which foreigners will not accept of in any pay- ment, and which any great disorder in the state will reduce to no- thing. ' ' Hume. Further Observations respecting the fallacious Notion that Paper Money is the Consequence of an Increase of Trade and of National Prosperity Sir John Sinclair's Idea about Roads and Canals Exemplification in the Instances of France and the American States Destruction of the Paper Money in both those Countries, the dawn of National Pros- perity Our own history shows the Influence of a National Debt in producing Bank Notes Our Bank was the Offspring of the Debt The Bank was necessary in order to pay the Interest of the Debt Boldness of Mr. Jackson and Sir John Sinclair in asserting that Paper Money is necessary to Trade, and is a Mine of National Prosperity What would Hume have said if he had been told that Scotland \vould produce a man to assert what Sir John Sinclair has asserted? The " LO HERE !" and the " LO THERE!" The real cause of the increase of the Bank Notes That Increase shown to have kept pace with the Increase of the Debt Conclusion of this part of our subject. GENTLEMEN, IN the foregoing Letter we opened the way to- wards the history of the Stoppage of Gold and Silver, or. Real-money payments, at the Bank of England, in the year 1797, by showing the divers ways in which bank-notes get out into circulation, or, in other words, the divers motives for making those notes; and by clearly showing also, in reasoning upon gene- ral principles, that it is Debt and not Wealth, that generates promissory notes, of whatever sort they may be^ or by whomsoveer issued. So fond, how- ever, have we been upon this subject, and such great pains, for so long a time, have been taken to make us believe, that the increase of the paper-currency proceeds from an increase of trade, or of something favourable to us, that I should not be perfectly sa- 104 PAPER AGAINST GOLD. tisfied with myself were I to hasten forward, without first submitting to you all the observations that have occurred to me upon this part of our subject. When those, who, from whatever motive, have written in favour of the Paper System, have had to account for the vast increase in the quantity of the bank notes, they have always had recourse to our " increasing trade" and " wealth" and "prosperity" and "improvement;" and they have, like Sir JOHN SINCLAIR, bid us look at the increase of turnpike- roads and canals and harbours and new inclosures. Now, this reference to roads, canals, harbours, and inclosures is singularly unhappy ; for, the Emperor Napoleon, in his annual speeches, to his Corps Le- gislatif, or Parliament, tells them of new roads and canals, compared to which ours are not worth na- ming, while we know pretty well that he has, du- ring this war even, made a harbour and an arsenal and a fleet too, where there was before no semblance of maritime means ; to get at which fleet, or, rather to attempt to get at it, has cost us all the lives and all the millions of taxes expended in the Walcheren Expedition ; and, while we see, that, as to agricul- tural improvements, France is able to let us have bread. Therefore, as this is the case in France, and as these same writers assure us, that the people of France are in a state of extreme misery r , methinks that new canals and roads and harbours and agricul- tural improvements should not, by these writers, at any rate, be cited as proofs of national prosperity. But, what have these exertions of genins and in- dustry ; these efforts of the bodily or mental facul- ties of a people ; what have these to do with paper- money ? There is no paper-money in France. Yet the French make roads and canals and har- bours and agricultural improvements. There is no paper-money, by which we always mean, paper not convertible into gold or silver at the will of the holder ; there is no paper of this kind in the AMERICAN STATES j yet, it is pretty notorious that PAPER AGAINST GOLD. 105 there are improvements going on in those Slates, some of which are truly astonishing, and one instance in particular, I cannot help giving you, just as I found it published in the London newspapers of the llth of last month.* Having seen and admired this * It is now a little more than five years, since a number of German families, styling themselves " THE HARMONY SO- CIETY," went to the United States, with the view of forming a distinct settlement. They soon planted themselves in the wilderness of BUTLER COUNTY, in the north-western corner of PENNSYLVANIA. The following account of the origin, and progress of their settlement is copied from the Mirror, a paper published in the neighbourhood of this frugal and industrious and thriving people : The Association of Harmonv had its origin in Germany upwards of 20 years ago ; and, feeling themselves much oppressed on account of their religion, they concluded to seek a country where they could exercise their religion without hinderance or oppression. They chose the United States of America. In the year 1804, in December, about 20 families arrived in Zelinople, in the neighbourhood of which, Mr. George Rapp, with some others, bought about 4,700 acres of land, and during that fall built nine log-houses. In the year, 1805, in the spring, the Society consisted of about 50 families: they laid out the town of Harmony on their own land, and, in that spring, built twelve log-houses 94 feet by 18, built a large barn, cleared 25 acres round the town, and 151 acres for corn, and 50 acres for potatoes ; a grist-mill was built this year, the race 3-8ths of a mile long, and 15 acres cleared for meadow, the other ground sowed with wheat and rye ; in the fall and winter, 30 houses more were built. In the year 1806 an inn was built two stories high, 42 by 32 feet, and some other houses ; 300 acres cleared for corn, 58 acres for meadow ; an oil-mill was built, and a tan- nery, a blue dyer's shop, and a frame barn 100 feet long. In the year 1807, 360 acres were cleared for grain and a meadow, a brick store-house built, a saw-mill and beer-brewery erected, and four acres of vines planted : in this year the Society sold 500 bushels of grain, and 3,000 gallons of whiskey manufactured by themselves of their own produce. In the year 1808, a con- siderable quantity of ground cleared, a meeting-house built of brick, 70 feet long and 55 feet wide, another brick house built, some other buildings and stables for cattle, pot-ash, soap-boiler and candle-drawer shops, erected, a frame barn of 80 feet long built. Of the produce of this year were sold 2,000 bushels of grain ; and 1,400 bushels were distilled. In the year 1809, a fulling-mill was built, which does a great deal of business for the country, also a hemp-mill, an oil-mill, a grist-mill, a brick warehouse 46 feet by 36, and another 106 PAPER AGAINST GOLD. wonderful, aixd, perhaps, unparalleled, instance of prosperity and happiness proceeding from the united exertions of genius and industry ; and, being at the same time aware, that something approaching to- wards it must necessarily be going on in other parts of the country, you have only to know, that there is no such thing as a paper-money in any part of that country ; for, then your conclusion must be, that a paper-money is not necessary to create, or to aid the operations 'of, genius and industry ; and, history, at once to inform and console you, affords you these further facts, that both in France and America, there has been a paper-money ; that, in both countries, that money has met with its total destruction ; and that, since such destruction, both countries have flourished much more than they did while that money was in existence. brick building of the same dimensions, one of which has a cellar completely arched under the whole, for the purpose of a wine-cellar. A considerable quantity of land cleared this year. The produce of this year was 6,000 bushels of Indian corn, 4,500 bushels of wheat, 5,000 bushels of oats, 10,000 bushels of potatoes, 4.000lbs. of hemp and flax, 100 bushels of barley brewed into beer, and 50 gallons of sweet oil, made from the white poppy. Of the produce of this year will be sold, 3,000 bushels of corn, 1,000 bushels of potat9es, 1,000 bushels of wheat ; 1,200 bushels of rye will be distilled. In the year IttlO will be erected a barn 90 feet long, a school- house 50 fe-3t by 44 wide, a grist-mill with three pair of stones, one of which will be burrs, and some small brick-houses for families. The society now consists of 780 persons, compri- sing 140 families ; they have now 1,600 acres of land cleared, 203 acres whereof are in meadow, and possess at present, 6,000 acres of land. There are different tradesmen members of this society, who work for the country as well as the so- ciety, to wit : Twelve shoemakers, six tailors, twelve wea- vers, three wheel-wrights, five coopers, six blacksmiths, two nail-smiths, three rope-makers, three blue dyers, ten carpen- ters, four cabinet-makers, two sadlers, two wagon-makers, twelve masons, two potters, one soap-boiler, a doctor and apothecary ; but neither parson nor lawyer, and in a short time a hatter and a tin-plate worker are expected. During the last year the shoemakers alone worked for the country to the amount of 112 dollars and 8 cents, the coopers to the amount of 207 dollars, the sadlers to the amount of 739 dollars 64 cents, the tannery 675 dollars, the blacksmiths 180 dollars. PAPER AGAINST GOLD. 107 What have the partisans of the Paper System to offer in answer to this? Will any one of them ven- ture to look these facts in the face ? I do not be- lieve they will. They will, I should suppose, rather choose to confine themselves to a dull re-assertion of their former assertions, interspersed, may be, with a seasoning of abuse upon those, by whom their igno- rance, or insincerity, is detected and exposed. But, without resorting to the instances furnished in foreign countries, have we not, in the history of our own finances, quite a sufficient proof, that paper-money, or, indeed, bank-notes of any sort, are not the re- presentatives of any thing but Debt ? In every country, of which we have any knowledge, a Go- vernment Debt has been accompanied with bank- notes, or payments in paper, of some sort or other, no matter under what name. The Debt, in England, did, as we have seen, (Letter II, p. 34) begin in the year 1692 ; and there appeared, at first, no intention to pay either the interest or the principal in any thing but the usual <*old and silver coin of the country. People lent their guineas and crown pieces, and there was not the smallest notion of their being repaid in any thing but guineas and crown pieces. But it was soon found, that to pay the interest of its Debt, the Government needed something other than gold and silver ; which, indeed, any one might have foreseen, because the Debt itself necessarily arose from the want of gold and silver within the reach of the Government. It was, therefore, supreme folly to suppose, that the Government, who had borrowed people's guineas from want, would long have guineas enough to carry on wars and to pay those people too. Accordingly, in only two years after the Debt began, the Bank was established; the Bank made notes; these notes, as far as they went, supplied the place of real money ; and, very soon, by giving all possible countenance and support to the Bank, the Govern- ment got great part of the interest of its Debt paid in bank notes. Thus were the bank notes, from the 108 PAPR AGAINST GOLD. very outset, as, indeed, all promissory notes must must be, the representatives of Debt, and not of wealth, of prosperity, or of trade ; and, if this was the case, at a time when these notes were con- vertible, into gold and silver, shall we now look upon them in a better light ? In spite, however, of the voice of history and of reason, and even in spite of common sense, there are (as in the instances of Mr. RANDALL JACKSON and Sir JOHN SINCLAIR) men to be found, so ignorant or so hardy as to hold up bank-notes, promissory notes, and promissory notes, too, not convertible into real 'money: there are men to s be found to hold up this paper^money, which, as we have clearly shown, is always issued in consequence of Debt, in conse- quence of a want of real money, and which paper- money is, as BURKE ( See the Motto to LetterVII. page 91) well describes it, " not the measure of the trade of its nation, but of the necessities of its govern- ment :" there are men to be found, who, like Mr. JACKSON, insist that an increase of paper-money is called for by an increase of trade ; and, who, like the bolder BARONET, scruple not to assert, that, " the abundance of circulation" (speaking of bank notes not convertible into gold and silver) " is the great source of our opulence and strength, and a MINE of national prosperity ;" yea, who have the bold- ness to call promissory notes, which are issued only because the issuers are not able to pay in money, a mine of national prosperity ; and, who are hardy enough to make this assertion at the very moment when they themselves are declaring, that it would be ruinous to attempt to force the issuers of suchf notes to pay them in money when presented. HUME, as will be seen from that passage of his Essay on Money, from which I have taken my motto, observes, that there is an inconvenience in the in- crease of real money, which, as was shown in the last Letter, is naturally produced by an increase of trade ; and he calls bank notes (though, observe, PAPER AGAINST GOLD. 109 convertible into gold and silver, as they were in his time,) counterfeit money. What, then, would tie have said of our present bank notes ; what would he have said of bank notes not convertible into gold and silver ; and what would he have said, if he had been told, that Scotland would produce a man, who would tell the people of Great Britain, and in print too, that such bank notes are a mine of National Prosperity ? We have now, I think, said quite enough to con- vince any man, whose faculties enable him to dis- tinguish falsehood from truth, that the notion of an increase of trade demanding an increase of paper- money is one of the most gross delusions, that either ignorance or an intention to deceive ever attempted to practise upon mankind. We have, in short, clearly shown, that the increase of bank notes, and of promissory notes of every description, are produced by Debt, are the offspring and representatives of Debt, and that real money, and real money only, is the representative of property p , or wealth, or things of real value, and, of course, that an increase of trade, which is only another term for an increase of moneys-worth things, demands, and if there be no unnatural cause to prevent it, will, of itself, bring into circulation an increase of real money. To acknowledge this truth would, however, have been so manifestly injurious to the Paper Money System, that it is not surprising that the partizans of that system (which is but another name for those who have profited, and do still profit, from it) should have taken uncommon pains to avoid the acknow- ledgment, and even to maintain, with their utmost ability, any opinion of a contrary tendency. Hence all the-absurdities, that we find in the various speeches and pamphlets, uttered and written upon the subject, and in which the increase of the bank-notes, and now of the paper-money, have been, at different times, attributed to almost every cause but the real one. At one time, it was the enterprise in commerce ; at 10 130 PAPER AGAINST GOLD, another, the enterprise in roads and canals ; at ano- ther, the " pressure of the war," which was, as a distant cause, true ; at another, it was a " temporary alarm ;" as another, it was speculations abroad ; at another, it was the u influx of wealth ;" at another, it was Jacobinism. ; and now there are three causes, an increase of trade, the embarrassment to trade occasioned by Napoleon's commercial warfare against us, and the exportation of gold! These last-men- tioned causes, which any one may hear from, per- haps, the three first persons whom he meets in Threadneedle-Street, do, to be sure, most admirably accord with each other ! But, it is the lot of false- hood to contradict itself. In the mean while, however, very great is the mischief which arises from the misguiding of the public mind. The people, while amused with this " Lo here /" and " Lo there /" see not that which they ought to see ; they see not the real cause of the increase of the paper-money, the real cause of the gold and silver having gone out of circulation ; and, of course, they use no endeavours, they express ao wish to see adopted any measures., calculated to remove that cause, and to relieve their country from this, the most formidable of all the dangers with which it is threatened. That this real cause is no other, than the increase of the Debt contracted by the Government, cannot, I think, be doubted by any one, who has gone pa- tiently through the foregoing Letters, and who must have seen, that, as the Dtbt increased, the bank notes became of greater amount in the whole, and of sums smaller and smaller, till, at last, they came down to a single pound. At first, and for half a century, there were no bank notes for a sum less than twenty pounds. When the Debt got to about 70 millions, there were fifteen pound-notes made ; before it reached 150 millions, there were ten pound- notes made ; and before it had reached 300 millions, there were Jive pound-notes made; and before it had PAPER AGAINST GOLD. Ill reached 500 millions, there were two pound-notes and one pound-notes made. Since it reached 500 millions, there have been in some parts of the coun- try, notes made to represent silver-coins j and the SILVER TOKENS, issued from the Bank of England, the intrinsic value of which is less than the nominal, have been circulated over the country, while the gold-coin, of every value, has almost wholly disap- peared, is notoriously exported, and while English guineas, not one of which is seen by hardly any man in England, in the course of a month, make part of the common current coin on the continent of Europe, in the American States, and more especially in France ; aye, in that very country, which PITT and his associates told us, over and over again, was in " the very gulph of Bankruptcy ;" and which we were, year after year, induced to believe would be totally ruined by the fall of that paper-money, the place of which has been, in a great part, supplied by our guineas ! Thus, then, we have seen, both from reason and experience, that it is Debt which produces bank notes, and paper-promises of every sort ; and, having seen the manner in which these paper-promises get out amongst us, and how their increase has kept pace with the increase of our Debt, we shall, in the next Letter, proceed to trace this increase to that grand and memorable effect, the Stoppage of Gold and Silver payments, at the Bank of England, in 1797. I am, Gentlemen, Your Sincere Friend, WM. COBBETT. State Prison, Newgate, Thursday, 21th Sept. 1810. 112 PAPER AGAINST GOLD. LETTER IX. The consternation was general through the whole kingdom. Thousand! of families were utterly ruined, and "reduced from opulence to beggary. Despair seemed to have seized upon the country, in which so many sui- cides were never before heard of." HISTORY OF THE SOUTH SEA BUBBLE. This Letter a Digression from the regular line of the Dis- cussion Death of Abraham Gold 8 mid t the great Jew Money-Dealer Effect of it described, as to the Funds He and Sir Francis Baring called the Pillars of the City The Corporation of Lpndon thought nothing of Perilous State of the Country, if such be the Pillars of its Credit Goldsmidt's Character His Charities His princely Enter- tainmentsHis Transactions with Sir John Peter at the Exchequer Bill Office The Motive for the Act of Self-Mur- der A Hint at the reasons why this Jew has been so praised ; and why benevolent Jew Characters have been introduced in to some of our Modern Stage Plays The cause of Goldsmidt's committing the Act History of the Loan- Transactions What Omnium and Discount are Progress of the Fall of the price of Stocks Newspaper Puffs to keep them up What must be the State of the Country if such trifling Causes produce Discredit " Capital, Credit, and Con- fidence" What security have we that Things will not be- come worse ? The effect upon the Minds of our Enemies Can it be supposed that People will purchase Stock, or hold Stock, if the Fabric be so frail? May not Napoleon cause a Combination against the Funds '? Of the Remedy or Expedient talked of The Loan-Makers have no Claim to Compensation for any Loss they may sustain The fa- mous and immortal Loyalty Loan in the Days of Pitt This Case different from that of the present Loan-Makers Conclusion of the Digression. GENTLEMEN, THE death, of ABRAHAM GOLDSMIDT, the rich Jew, mentioned in Letter I, page 20, and who is said to have shot himself on Friday last, the 28th of Sep- tember ; this death is, in the history and progress of the Paper-Money System, an incident of some im- portance, and, at this time, worthy of our particular attention ; because the circumstances connected with it afford, perhaps, a more striking and satisfactory illustration, than any other that can be imagined, of PAPER AGAINST GOLD. 113 the loan-making' transactions. In inquiries which are of an intricate nature, it is always advantageous to be able to combine practice with principle ; and we shall, I think, find in the circumstances just al- luded to, such a development, such a practical ex- emplification, of some of the principles which we have laid down, as could scarcely have been derived from any other source. The present Letter will, indeed, turn us a little aside from the direct line of our pursuit, and may be considered as a Digres- sion; but, it will not tend to confuse us, and the matter of it will be found of great use to us during the rest of our inquiry. The newspapers, and particularly those which praise the Government unceasingly, have stated, that, when the intelligence of this man's death reached the city of London (he having shot himself at his house, or rather palace, at the village of MOR- DEN in Surrey) all was confusion and consternation. They tell us, that " The Stock Exchange, Capel- court, and even the Royal Exchange, were crowded, all persons eagerly making inquiries about this event, and forgetting almost every thing else. Little or no business was done. We question whe- ther peace or war suddenly made, ever created such a bustle"* We are told, that " Words would be inadequate to express the surprise, the alarm and dismay that were visible. "f We are further told, that the moment the intelligence reached the city of London, u the FUNDS felt the effect, and 3 per cent. Stock fell from 66^- to 63f;"J that is to say, hun- dreds of millions of this sort of property instantly lost in value about 3 pounds in every hundred. We are told, in another place, that " the Ministers sent off a messenger, with the melancholy tidings, to the King and to the Prince of Wales." And all this for the death of a Jew merchant ? * COURIER Newspaper, 28th Sept. t Ibid, t TIMES Newspaper, 29th Sept. COURIER Newspaper, 28th Sept. 10* 114 PAPER AGAINST GOLD. The King and the Heir Apparent to be informed of it by a royal messenger 1 And, is it really true, that this man's having shot himself made the citi- zens of London forget almost every thing else ? Is it really true, that such an event put business nearly at a stand ? Is it really true, that it produced an effect equal to peace or war suddenly made ? And is it true ; is there truth in the shameful fact, that a Jew Merchant's shooting himself produced alarm and dismay in the capital of England, which is also called, and not very improperly, perhaps, the emporium of the world. If all this be true, it is high time that we become acquainted with the reasons why such a person was thought of so much consequence, and that we con- sider well the tendency of a system, that could make his life or his death an object of national im- portance. One of the public prints presents us with the following disconsolate reflection : " The muta- bility of human affairs has been strongly evinced during the last few weeks. Sir FRANCIS BARING and MR. A. GOLDSMIDT, who were considered as the PILLARS OF THE CITY, are both dead within that time. The effects their deaths have had on the funds of the country will best bespeak the support they gave them while they lived."* What ! The Pil- lars of th e City of London ! The Corporation of that famous City, the Mayor, Aldermen, Sheriffs, Com- mon Counsellors, and the Liverymen ; all these ; the whole of this admirably constituted body, to which, upon so many occasions, the people of the kingdom have been indebted for the preservation of their liberties ; the whole of this body sinks out of sight, and all the Companies of industrious and inge- nious Tradesmen along with it ; they all become nothing, at the mention of the names of a couple of dealers in funds and paper-money ! With eyes very different indeed do I view the parties j and, though I * TIMES Newspaper, 29th Sept. PAPER AGAINST GOLD. 115 desire not the death of either, and am as sorry as you, my neighbours, to hear of the untimely death of any man, I have not the smallest hesitation in saying, that I look upon the life of Sir FRANCIS BA- RING, or that of GOLDSMIDT, as being of no more, it so much, value to England, as that of any one of your apprentices, or plough-boys; and I have no doubt, that, before we arrive at the close of this Series of Letters, you will see good reason for be- lieving, that my opinion is founded in a just esti- mate of the nature and tendency of the professions of these several parties. But are these writers aware of the import of their words, when they tell us, that the two persons above- mentioned were the PILLARS of the City ; that they gave support to the funds of the country ; and that their deaths have occasioned those Funds to fall ? Are these writers aware of the tendency of such decla- rations? Do they consider what it is that they are saying ; what it is they are proclaiming to the peo- ple and to the world ? If they do, and if they expect to be believed, their intention must be to destroy all confidence in the Funds and Stocks : for what man in his senses can possibly confide in that which leans for support upon the life of individuals ; and of individuals, too, who, from the perils of their very calling, are liable to be driven to commit acts of suicide? In some cases, we are compelled to leave our property dependent upon the lives of indi- viduals ; but no man with his intellects perfect, ever does this from choice ; and if these writers should make the public in general believe, or if the public from any other cause should believe, that the Funds stand in need of the support of individuals, it is a pretty clear case, that the price of them must fall very low, before many people will be inclined to dis- pose of their solid property, in order to purchase Stock. They must come down to almost nothing, and the purchase must be a sort of gambling; for no man will lay out his money in Stock, as men 116 PAPER AGAINST GOLD. hitherto have done, if it should become matter of general belief, that the Funds are in any degree de- pendent upon the lives, and, of course, upon the will of individuals. We will now see (for it is very curious) what has been said as to the cause of GOLDSMIDT'S putting an end to his life ; and, that will let us into matter es- sentially belonging to our subject. But, before we proceed any further, I think myself called upon to make a few remarks upon what has. in some of our newspapers, been said, about the character of this man ; for, though I have no desire to say any harm of him, or to cause people to believe harm of him, I think it wrong ; I think it very unjust towards my readers; I think it an act of treason to the morals of my country, to stand by, with pen in hand, and to see spread abroad amongst the people such un- qualified praises of a man, who has terminated his existence by suicide, and, especially, when I do not believe those praises to be founded in truth. We are told of his acts of charity ; his sub- scriptions to charitable undertakings; his name, we are told, was always seen foremost upon such occasions. But why tell us of this again, if every individual act has been carefully printed and pub- lished before. There are cases, in which a man's acts of charity may get out to the world in spite of him ; but he is very unlucky when his name is print- ed upon every trifling occasion, which has been the case with this man's charities. Besides, what has he given, put it all together ? Not, perhaps, the odd shillings and pence upon the enormous sums that he has gained by his dealings with the Govern- ment ; and is any man so blind as not to perceive, that motives very different indeed from those of cha- rity, might dictate his gifts? A man, acquiring such immense wealth, must see that something was necessary, to keep the public from grudging; and, though I do not take upon me to say, that GOLD- SMIDT'S donations proceeded from this motive, I PAPER AGAINST GOLD. 117 cannot help thinking that they frequently did, when I recollect how many paragraphs, stating the nature and amount of his charities, I have, at different times, read in the newspapers. " Who builds a Church to God and not to fame, Will ne'er inscribe the marble with his name." One of his eulogists says : " he had done so many kind and generous actions his benevolence was so enlarged his public and private character was so princely, embracing men of all persua- sions he was so unostentatious in his habits, and so mild and cheerful in his manners ; in short, a man more truly amiable in all the relations of life never existed. He was incessantly employed in acts of friendship ; and though, like every man of extensive dealings, he had to encounter the bitterness of opposition and envy, we never heard even from his most active rivals, any other than the most fa- vourable testimony to his virtues. He died in the 53d years of his age. We understand that which preyed most acutely on his feelings, and wrung from him many an agonising exclamation, was the manner in which he had been treated by some per- sons who had been under the greatest obligations to him. He had, for years, been a man the most looked up to in the monied market his command of money had been immense his credit unbounded. This was a proud situation ; but, elevated as he was, it inspired him with nothing like hauteur or inso- lence he was still the same affable man, increasing in kindness, if possible, with his increasing wealth."* The much greater part of this has not, I am satisfied, a particle of truth in it. Never was any thing more ostentatious than the acts of benevolence, as they are called, of this man, who, as I observed years ago, merely tossed back to the miserable part of us, in the shape of alms, the fractions of the pence, upon the immense sums of money that he got by * MORNING POST Newspaper, Oct. 118 PAPER AGAINST GOLD. his traffic in loans and bills and funds. The pub- lic, if it has any memory at all, must remember the accounts that were given of his entertainments, at which even princes were present ; and at which, probably, as much was consumed in an evening as would have maintained the whole village of Mor- den for a year. Of these entertainments the most pompous accounts were published in all the news- papers of the day ; and, from the manner of the publication, there can be but little doubt of its having been paid for. As to his having shown his hospitality to men of all persuasions, that is pre- cisely what a man does, who is more intent upon securing the favour of men in power, than upon cultivating real friendship ; and, indeed, I have, for my part, very little doubt, that the cost of the en- tertainments of GOLDSMIDT was always put down amongst the necessary outgoings of his trade. Thus far, however, what I have stated may be called matter of opinion. What I am now going to state is matter of fact, and of fact, too, that the people of England should have been made fully acquainted with long ago. I allude to this man's transaction with Sir JOHN PETER in the funding of Exchequer Bills, and which transaction is related in a Report made by a COMMITTEE of the House of Commons, which was ordered to be printed on the 14th of May last, and which will be found at page 193 of the Appendix to Vol. XVII. of the Parlia- mentary Debates. And here, Gentlemen, we shall have a view of something of no small interest to us, as belonging to the Inquiries in which we are en- gaged. In Letter VII., at page 100, mention was made of Exchequer Bills ; and they were described as one sort of the promissory notes issued by the Govern- ment in payment of persons to whom they owe money. They are like other promissory notes, with this difference, that they bear an interest of so much upon each hundred pounds every day, the PAPER AGAINST GOLD. 119 rate of which interest vanes according to circum- stances. In short, an EXCHEQUER BILL, which de- rives its name from the place whence it issues, is like a bank note, not convertible into money at the will of the holder, except that the bank note does not hear interest, and the Exchequer Bill does. You will easily perceive, that these Exchequer Bills, while out, form a part of the National Debt. They belong to what is called Unfunded Debt ; and they are sometimes paid off and taken up, as a private person pays oft* and takes up his notes of hand. But, sometimes, the Government, like the private person, finds it inconvenient to pay off these bills ; and, in such cases, it funds them ; that is to say, it makes an advantageous offer to the holder of them to exchange them for Stock ; and when this is done, the amount of such Exchequer Bills is, of course, added to the great mass of the permanent National Debt ; which, as you will perceive, is a way of borrowing money that occasions much less talk and noise than would be occasioned by a new loan. The loan, this year, was for 14 millions ; but then, there were Exchequer Bills funded to the amount of eight millions, so that the addition to the permanent or funded Debt, has, in fact, in this one year, been 22 millions. 1 have just said, that when the Government finds it inconvenient to pay off and take up Exchequer Bills, it makes an advantageous offer to the holders of them, by which these holders are induced to give them up, and to take Funds or Stock, in lieu of them. The Bills are brought by the holders to a cer- tain place, called the Exchequer Bill Office, where they are received, and where the voucher is given which .procures the holder stock in exchange for them. Upon these occasions, there is generally a great struggle of the Bill-holders, to get first into the office ; because, when the quantity of Bills to be funded has been presented and received, all the rest must, for the present, at any rate, still remain 120 PAPER AGAINST GOLD. with the holders ; and, as there is an advantage in getting them funded, it is evident enough, that there must always be an anxious rivalship in pursuit of that object. Upon an occasion of this sort, in the month of March last, ABRAHAM GOLDSMIDT attended, amongst others, with a view of getting into the Exchequer Bill Office ; and, being unable to get in at the. com- mon door, so early as some others, he went to a pas- sage leading to another part of the office, where he met Sir JOHN PETER, one of the Paymasters, or per- sons who conduct the business of the office. " To this person, he delivered his pocket-book, contain- ing Exchequer Bills to the amount of 350,000 pounds, and then went away. Sir JOHN PETER carried in the book and the bills ; and, in conse- quence of this, GOLDSMIDT'S bills were funded ; while the bills of other persons, who had attended from the earliest hour, and had got in amongst the very first, and whose bills were actually received, had their bills returned without being funded." It appears also, from the Report, that, upon a previous day, this GOLDSMIDT, with a few others, had found out and used the means of getting into the Office before the door was opened to the public. The Committee state, that the same Paymaster, " Sir JOHN PETER, according to an arrangement previ- ously made, did, on the first day of funding, before the doors were open to the public, take into the of- fice with him, Mr. GOLDSMIDT, Mr. SUTTON, and Mr. GILLMAN, as appears from the evidence of Mr. Gillman and Mr. Sutton. The other Paymaster in attendance, Mr. PLANTA, says that he found those gentlemen in the Board-Room upon his arrival at the office ; that he knew it to be a great improprie- ty ; that he expressed indignation at the proceed- ing, and ordered the doors to be immediately thrown open to the public. The names, however, of the gentlemen so introduced, stand amongst the very first on the books of that day" The Committee PAPER AGAINST GOLD. 121 reprobate these proceedings, as partial, unjust, and foul ; and recommend means for preventing the like in future. Now, Gentlemen, this is quite enough to enable you to judge of the real character of GOLDSMIDT, who is so extolled by our courtly news-writers, who have, doubtless, their reasons for what they do ; you will, from these facts alone, facts which cannot be denied, be able to judge, whether this man is de- serving of the character, which, with so much in- dustry, is given him ; whether he was that kind, be- nevolent, disinterested, generous, and noble-minded man, which he has been represented to be ; or, whe- ther, with all his outward show of liberality and ge- nerosity, he was, as to his essential practices, still a money-loving, a money-amassing Jew, and nothing more; and if any additional proof of this were wanting, what need we but the simple fact of his having killed himself, because lie was losing a part of his immense wealth ? a truly Jew-like motive for the commission of an act at which human nature shudders. Gentlemen, how much more to be re- spected, and to be pitied, are hundreds and thousands of your industrious and honest neighbours, who had their all snatched from them in a moment, and who, after a life of labour and of abstinence, saw them- selves deprived of the means of buying a dinner; and that, too, observe, without any fault of theirs, without any greedy speculation, any desire on their part to gain by overreaching their neighbours, or to possess any thing which was not the fair fruit of their labour ? What value are we to set upon the princely feasts of a man, who could creep in at a back door to get the preference in funding Exche- quer Bills ? What value are we to set upon friend- ship, such as he would, doubtless, entertain for such men as Sir JOHN PETER? And, as to his charities ; as to what he used to give to the miserable part of our countrymen, under the name of charities, it is very probable, that the whole of what he bestowed 11 122 PAPER AGAINST GOLD. in this way in the course of his life, did not amount to half so much as the sum that he gained in conse- quence of his proceeding above-noticed with Sir JOHN PETER. Gentlemen, the reasons why he has been so much praised by many of our news-writers would amuse you ; and it would also entertain you to learn the real caus? of the fine benevolent Jewish characters, which are to be found in some of our modern plays ; if, indeed, a feeling of shame for your coun- try did not overpower your propensity to laugh at these offerings of literary venality at the shrine of Mammon. But, having now bestowed quite as much time as it merited in remarks upon the character of the departed Jew, but which remarks were demanded by truth, we will now proceed to those matters, con- nected with his death, which are of much greater consequence to us, and a clear understanding of which will be found to be greatly useful in the course of the remainder of our inquiries. Indeed, these matters not only relate to our subject, but they are strongly illustrative of some of the most important parts of it. The cause of GOLDSMIDT'S committing the act of self-murder is stated as follows : " The cause of this rash act it is not difficult to assign : Mr. Goldsmidt was a joint contractor for the late loan of 14 mil- lions with the house of Sir Francis Baring, and. taking the largest probable range that he had dealt amongst his friends one half of the sum allotted to him, the loss sustained by the remainder, at the rate of 65/. per thousand, which was the price of Thurs- day, was more than any individual fortune could be expected to sustain. Ever since the decline of Om- nium from par, Mr. Goldsmidt's spirits were pro- gressively drooping ; but when it reached 5 and 6 per cent, discount, without the probability of reco- vering, the unfortunate gentleman appeared evi- dently restless in his disposition, and disordered in his mind ; and, as we have reason to believe, not PAPER AGAINST GOLD. 123 finding that cheerful assistance amongst his monied friends which he had experienced in happier times, he was unable to bear up against the pressure of his misfortunes ; and hence was driven to terminate a life which till then had never been chequered by misfortune. The moment intelligence of the dis- tressing event reached the city, which was about the period of the opening of the Stock Exchange, the Funds suddenly felt the effects, and the Three per Cent. Stock fell in a few minutes from 66 to 63 -J-: Omnium declined from about 6} to 10J- discount, and then remained steady at that price for some time."* What to do with all these cant words one hardly knows ; but, taking along with us what we have before seen, we shall be able, with a little ex- planation, to understand them. In Letter II. page 34, and onwards, we saw some- thing of the manner in which Loans are made to the government ; but we must here speak of the transaction a little more in particulars. The Loan- Maker bargains with the Minister to lend so many millions of money, upon condition of receiving so much Stock, and we have seen what Stock means. But, this Stock (as will be seen in Letter II. page 34,) is of several sorts : 4 per cents., 3 per cents., and so on. And the Loan-Maker generally agrees to take some of each sort. As soon as the Loan is made, he begins to sell his Stock, as we have seen, in page 38, to such people as our good neigh- bour, FARMER GREENHORN ; but when he sells it, all the sorts of it are put together, and hence it is called OMNIUM, that being a Latin word, meaning THE WHOLE TOGETHER, Or ALL TOGETHER. When the Omnium will sell for more than has been given for it, it is said to be at a premium ; and when it will not sell for so much as has been given for it, it is said to be at a discount, that word meaning, to count back, or to refund ; so that, in these transac- * TIMES Newspaper, Sept. 29. 124 PAPER AGAINST GOLD. tions, to sell at a premium means to gain by the sale, and to sell at a discount means to lose by the sale ; premium means gain, and discount means loss. Applying this to what we have before seen re- specting the cause of the death of GOLDSMIDT, it will be perceived, that he was losing 6 per cent., or 6 pounds in the hundred, upon his part of so im- mense a transaction as that of a Loan of 14 mil- lions. It is said, you will observe, that he and the BARINGS took the loan between them ; and it is sup- posed, that a great part of his share remained un- sold, at the time when the fall in the price took place. His loss, if the price did not mend, would, of course, be immense ; and, it appears, that the thought of such a loss was more than his mind could bear ; which latter is by no means wonderful, seeing that his soul was set upon gain ; that all his views and notions of happiness centered in wealth. The lover, whose passion is too strong for his rea- son, destroys himself, because the object of that passion is dearer to him than life. GOLDSMIDT de- stroys himself, because wealth is dearer to him than life. And yet, we are to be told of the princely munificence of this man ! Never was there a nation so much insulted as this ! In most cases there is a considerable gain made by LOAN-MAKERS, who have, indeed, in many cases, become so rich by these transactions as to be ena- bled to surpass in expenses the gentry and the nobi- lity of the kingdom, which, as we shall by-and-by see, is one of the great evils of the National Debt. How it has happened, that so great a loss has hi- therto been experienced upon the present loan, it would be very difficult, perhaps, for any one to tell. It has been asserted, in the public prints, that there was a combination against the Loan-Makers ; but this is perfect nonsense ; for all Stocks fell at the same time ; and what a fine state must that thing, called PUBLIC CREDIT, be in, if any combination of individuals can injure it. PAPER AGAINST GOLD. 125 The progress of the fall in the price of Stocks, and particularly of the Omnium, upon this occasion, is very curious ; and, it will be of great use to us to take a look back into the public prints, and see the attempts there made to keep up the prices ; attempts which come very fairly under the denomination of puffing. These attempts are worthy of the greatest attention ; for, trifling and even stupid as they ap- pear, and as they are in themselves, they will, if I mistake not, be hereafter referred to, as being amongst the most significant signs of the times. These attempts began with a paragraph, inserted in all the daily news-papers, stating the amount of the fortune of Sir FRANCIS BARING'S family, who, it will be recollected, were now become the part owners of the OMNIUM along with GOLDSMIDT. The paragraph, of the llth of September, was as follows: "Yes- terday morning, at one o'clock, died, at his house at Leigh, Sir Francis Baring, bart, in his 74th year. He was physically exhausted, but his mind remained unsubdued by age or infirmity to the last breath. His bed was surrounded by nine out of ten, the num- ber of his sons and daughters, all of whom he has lived to see established in splendid independence. Three of his sons carry on the great commercial house, and which, by his superior talents and inte- grity, he carried to so great a height of respect and the other two sons are returned from, India with fortunes. His five daughters are all most happily married, and in addition to all this, it is sup- posed he has left freehold estates to the amount of half a million. Such has been the result of the honourable life of this English Merchant." On the 17th of September, the following was pub- lished r " Stocks experienced this morning a consi- derable depression : Omnium was at 5^- discount. The death of Sir Francis Baring is said to have been the chief cause of it." On the 19th : " The sudden and rapid decline of the Stocks merits, it may be supposed, some notice. 11* 126 PAPER AGAINST GOLD. Consols, which began yesterday at 66f , closed at 65^- ; and Omnium left off at 6 J- discount. Various causes were assigned for this effect, (a descent upon Heligoland, a subsidy to Russia,) all equally im- probable. We can do no more at present than state the fact, though we strongly suspect that we know the cause" On the 20th: c; Stocks were better this morning; and the attempts to continue the depression of the Funds are likely to be defeated, as they ought to be" On the 22nd: "Yesterday being a holiday, no business was publicly transacted in tne Funds, but several private bargains were made at an advanced price. Consols were done at 662" which is a material rise. There is reason to hope that a few days will dispel the alarm which was raised and propagated beyond what any just cause could warrant, by per- sons desirous of fishing in troubled waters ; by certain writers, eager to convert public confusion to the promotion of their political views, and by certain jobbers, anxious to make it subservient to their pecuniary interests. The erroneous idea, so industriously circulated by certain individuals, that there is a depreciation of the Bank currency, has undoubtedly contributed, in some degree with other circumstances of pressure, to produce the late de- pression in the funds." Now, it must be observed, that these paragraphs were circular / that is to say, they went through all the daily news-papers, or, at least, nearly all of them ; and, for aught I know to the contrary, through the weekly news -papers too ; so that, there is not the smallest doubt of the puffing having been carried on at the instigation of some interested party. But, Gentlemen, what a state, I again ask, must that thing called PUBLIC CREDIT, be in, if it can be affected in this way ? First Sir FRANCIS BARING'S death causes the Funds to fall, and the fall in the Funds causes the death of GOLDSMIDT, and then the death of GOLDSMIDT causes the Funds to fall lower PAPER AGAINST GOLD. 127 still! What is all this talk about combinations; about attempts to continue the depression ; about an alarm beyond any just cause ; about the Funds being depressed by persons desirous of fishing in troubled waters, by certain writers eager for public confusion ; by certain jobbers anxious to promote their own in- terest ; by certain individuals who have insidiously circulated erroneous ideas about the depreciation of Bank notes ? What is all this talk ? What does all this mean ? Is it come to this at last, that this PUBLIC CREDIT, which was to defend us against all the warlike operations of France ; is it come to this, that this PUBLIC CREDIT, this defence of the country, is to be destroyed, or, at least, materially affected, by the tricks of money-Jobbers, the opinions (and the erroneous opinions too) of political writers, or by the death of a Jew ? If this be the case, let those who have what they call money in the Funds ; let the GRIZZLE GREENHORNS look to themselves. At the peace of Amiens, when we reminded PITT and his associates of the promise they had made us, never to make peace without obtaining " indemnity for the past and security for the future," and, when we proved to them, that, while they acknowledged that they had obtained no indemnity for the past, they had left us more insecure than ever for the fu- ture : when we pointed out to them the consequences of their war, which had put into the hands of France so many countries, end so much of maritime means ; and of their peace, which had left all these terrible means in her hands : when we pointed out this to them, what was their answer? Why this: that, though France had acquired a great extent of territory, her acqui- sitions in point of strength did not surpass ours, which consisted of an immense mass of CAPITAL, CREDIT, and CONFIDENCE ; the changes upon which words were rung over and over again, till the speech became full as enlivening and instructive as a peel of the three bells of Botley Church. But what becomes of these fine things, if the scribbling of a news-paper 128 PAPER AGAINST GOLD. writer, or of a pamphleteer, or if the sudden death of a Jew, is capable of so materially affecting them ? What, in that case, becomes of that Capital, Credit, and Confidence, which were to counterbalance all the acquisitions of France, and were to prove a never-falling defence to England ? True, said the adherents of PITT, who wished still to find some- thing to say, by way of apology, for his ruinous measures, " true," said they, " France has made conquests ; she has gained sea-ports ; she has ac- quired and now quietly possesses, the means of rear- ing a navy ; but look at the immense CAPITAL of England : look at her CREDIT ; look at the CONFI- DENCE which she possesses ; look at these pillars of national strength. 7 ' It was not easy to see, however long one looked, that these things were pillars of national strength ; but, if they were ; if they were the pillars upon which this nation was to depend, what are we to think of our situation, when we are told, as we are in the above-cited publications, and, indeed, as we are told every day, that the Funds, which are said to be the barometer of national CRE- DIT, can be, nay, have been, and still are, lowered in their value by such trifling things as the erroneous opinion of a writer on politics, or the death of a Mer- chant or a Jew ? If what we have been told about the importance of CREDIT be true ; if it be our de- fence against the enemy, what must our situation be, if what we are now told be true, namely, that this CREDIT has been shaken by such contemptible means ? PITT and his associates told us, that CAPITAL, CRE- DIT, and CONFIDENCE; which is using three words instead of one, merely for the sake of the sound ; they told us that these were the pillars of the na- tion ; and, as we have seen above, our news-papers now tell us, that Sir FRANCIS BARING and GOLDSMIDT were the pillars of our CREDIT ; so that, at last, we come to this comfortable conclusion that the de- fence and preservation of the country depended upon Sir FRANICS BARING and GOLDSMIDT, one of whom PAPER AGAINST GOLD. 129 has died, and the other shot himself, within the last three weeks ! And this is the effect, is it, of the PITT system of what is called Public Credit ? If what we are now told be true, what security have we, that things will stop where they are ? What reason have we to conclude, or to suppose, that the same causes will not continue to operate, 'till the whole of the Funds are annihilated ; that is to say, until nobody will give any thing at all for any sort of the Stock ? We are told, that the fall which has already taken place, has, in part, been the consequence of combinations of individuals, which must mean, combinations not to purchase ; and who is to put an end to such combinations ? Who is to prevent the force of them from increasing? Then, again, we are told, that the fall has partly been pro- duced by jobbers intent upon their own interests ; and who, let me ask, is to alter the nature of these jobbers ; who can say, or even guess, when these in- terested jobbers will be pleased to desist from their selfish and mischievous practices ? If the causes of the fall be such as have been stated to the public in the above-cited and other publications, who will pretend to say when or where, the fall will stop ? And I should be very glad to hear any reason, why, if those alleged causes be founded in truth, the Funds should not continue to fall, till they are not worth owning ; till it is not worth GRIZZLE GREEN- HORN'S while to have her name written in the Great Book. We here see, that these boasted friends of their country ; these men of such high-flying loyalty ; these writers who accuse of Jacobinism all those who cannot believe, and who will not say, that the Paper- money is as good, if not better, than Gold and Sil- ver ; we here see, that these boasted friends of their country, who, apparently, would eat Buonaparte raw, if they could get at him ; we here see these outrageously-loyal writers proclaiming to that same Buonaparte what must delight him more than al- 130 PAPER AGAINST GOLD. most any thing that he could hear, namely, that such is the state of our public credit, such the state of our pecuniary resources, such the confidence in our funds, such the confidence in the security of our government- bonds, that this confidence is shaken by a combina- tion of jobbers, or the death of a Jew. How much abuse has been, at various times, heaped upon those, who have expressed their doubts as to the durability of the Paper-money system ! Nay, the Bullion Com- mittee themselves have been very grossly abused for their Report upon the subject; by which Report, their opponents say, they have injured the credit of the country. They are charged with having injured the credit of this country, because they have recom- mended that the Bank of England should pay its notes in Gold and Silver. What, then, are those men doing, who now assert, that a combination of individuals ; that the tricks of interested jobbers ; that the erroneous opinions of political writers: what are the men doing, who assert, that these things are capable of causing the government securities. to fall in value ; and who scruple not to tell us, that the men who where the pillars of the Public Funds, are dead ? What are these writers doing ; and how will they now be able to hold up their heads and complain of the endeavours of others to destroy what they call public credit, which, if it admit of de- struction by the means of the pen, must assuredly fall for ever under the pens of these writers ? If what these writers say be true ; if the stocks are to be lowered in value by combinations of individuals, by the errors of writers, by the reports of commit- tees, or by the death of a Jew ; if this be true, can it be thought, that people will long be disposed to be- come proprietors of stock ? Can it be thought, that they will, like our neighbour GREENHORN, put their money in the Funds ? Can it be expected, that fa- thers and mothers will make provision for their child- ren, or their grand-children, by purchasing stock, liable to be lowered in value by such causes ? Nay, PAPER AGAINST GOLD, 131 can it be expected, that any man in his senses, who is now the owner of stock, will not dispose of it as soon as possible, and at almost any rate ? For, is it possible to regard as safe property ; is it possible to regard as any property at all, a thing, the value of which may be lowered ten per cent, in the space of ten days, and, of course, which may be lowered to almost nothing ? Is it possible to regard as any property at all, a thing, the value of which may be ilms reduced by the combinations of individuals, the trickery of jobbers, the errors of political writers, or the death of a Jew, or of any other individual, or number of individuals ? Is it possible to regard such a thing as property ? Common sense says, <; No ;" and yet the statement of these causes, a statement which, if it have any effect at all, must tend to the discredit, and, indeed, to the destruction, of the Funds ; this statement comes from the pens of those, who cry out JACOBIN against every man who ventures, in however modest a way, to express his doubts of the solidity of the Funding System. These writers, in their eagerness to abuse those, to whom they impute the fall of the Funds, seem to have overlooked the conclusions that would natu- rally be drawn from their premises, else they would have perceived what a dangerous thing it was to de- clare to our powerful and sharp-sighted enemy that a combination of individuals was capable of shaking our Funds. That enemy is, by these same writers, represented as being all-powerful by his intrigues in other countries ; and, is it too much to suppose, that it might be possible for him to find the means of forming combinations against the Funds in England? If combinations of individuals can pull down the value of our government securities, is it to be be- lieved, that our enemy will not be disposed, and that he will not endeavour to form such combinations 1 And, if we are asked, where he will find individuals so base, have not these writers pointed them out to him ; or, at least, have they not told him, in terms that 132 PAPER AGAINST GOLD. admit not of misunderstanding, that there are such individuals in England, in London, and now actually at work ; and that these individuals have caused the Funds to fall, have caused the government securities to lose part of their value? Let these writers, therefore, confess that these statements of theirs have proceeded from error; or, at any rate, that they are untrue ; or let them for ever hold their tongue as to complaints against those, who entertain doubts of the solidity of the paper-money system. Here, Gentlemen, I should have concluded this already-too-long Letter : but an article which I find in the public prints of this morning (Tuesday, 2nd October,) induces me to add some observations upon the subject of the remedy or expedient, which has been more than hinted at. The article alluded to, is as follows : " The state of the Funds was a little improved yesterday ; and, as no bad consequences, beyond those of the first shock, had arisen from Mr. Goldsmidt's death, it is hoped that things will soon be restored to their former level. The result of the conferences of the leading Loan-holders, with the Chancellor of the Exchequer and the Lords of the Treasury, on Saturday, has not yet been made known. Mr. Goldsmidt's house continues to dis- charge, without reserve or hesitation, all the demands made on it. The account at the Stock Exchange was not settled nor declared yesterday, in conse- ; quence of the attendance of Mr. Nathan Solomons, Mr. Goldsmidt's broker, at the funeral, which took place, according to the Jewish rites, about noon yes- terday. His body was placed by the side of that of his brother Benjamin. Yesterday morning early, Mr. Perceval came to town from his house at Ealing, and soon after sent off letters to the Go- vernor and Deputy-Governor of the Bank, Mr. Wish, the Chairman of the Commissioners of Excise, the Treasurer of the Ordnance, and a number of other official Gentlemen ; they all attended Mr. Perceval, and he was with them during the whole of the day." PAPER AGAINST GOLD. 133 These conferences will not, I trust, as some per- sons appear to suppose, lead to any application of the public money, that is to say, of the taxes, to the assisting, as it is called, of these Loan-holders. The Loan-holders, or Loan-makers, have never been known to return to the people any part of the im- mense profits, which they, from time to time, have made upon their loaning transactions. We see, from one of the above-quoted passages, that Sir FRANCIS BARING has gained enough to lay out half a million of money in freehold estates. Great part of this was, it is reasonable to suppose, gained by the many loans to Government, in which he has been at differ- ent times concerned. Well then, if these profits, these immense gains, be considered as fairly belong- ing to him, or his heirs and successors ; and, if we view the not less immense gains of GOLDSMIDT in the same light ; if the gains be theirs, ought not the loss to be theirs also ? Upon any other principle, what a sort of bargain would a government loan be ? A bargain, where all the chance of gain would be on one side, and all the chance of loss on the other. If the loan-maker gained, well ; but if he lost, the people must make good his loss. Is this the way that dealings take place between man and man ? Is there any one of you, Gentlemen, who would sell a load of wheat to a miller, leaving him the chance of gaining by it, and, if he happened to lose by it, would give him back again the amount of his loss? Oh, no ! You would keep the whole of the price of your wheat, and leave the miller to console himself in counting his gains upon other occasions. But if, contrary to my wish and expectation, " relief" as it is called, were to be given to those persons^ in what way could it be done? The loan is made and ratified in virtue of an ACT OF PARLIA- MENT. There can be no alteration made in the bar- gam ; there can be no change in the terms of pay- ment ; there can be no abatement in the demands of the Government, without another ACT OP PARLIA- 12 134 PAPER AGAINST GOLD. MENT, previously passed. Those who made the loan must pay the 14 millions into the King's Exchequer, let what will be their loss upon the transaction, un- less indeed, the whole of their property, real and personal, be insufficient for the purpose ; and, in that case, the people have a right to expect, that the Government will take care to hold back from the loan-makers, or to recover from them, so much of the new Stock as will not leave the loan-makers a far- thing in the people's debt. During PITT'S Anti-jacobin War, which, as you will bear in mind, was to succeed by producing the destruction of the paper-money in France ! during that war, which was to diminish the power of France, and to restore the Bourbons, by the means of ruin to the French finances ; during that famous war, which was to plunge, and which, as PITT told us. did plunge, France "into the very gulph of Bankruptcy;" during that renowned war, there was what was called a "LOYALTY LOAN." People were invited, in the name of Loyally, to come for- ward and lend their money to the Government, for the purpose of carrying on the Anti-jacobin war with vigour ; and, at the same time, no very unin- telligible hints were given, in some of the public prints, that those who had it in their power to lend, and did not lend, upon this occasion, were deficient in point of loyalty ; an imputation not very plea- sant at any time, and, at the time to which we are referring, singularly inconvenient. The LOYALTY LOAN was accomplished ; but, owing to some cause or other, it did not prove to be a profitable concern for the lenders; and, as in the case of the present loan, as far as it has gone, the loan fell to a dis- count, and a loss was sustained upon it. Such loss, one might have expected, would have been not only contentedly, but gladly sustained, as a sacrifice upon the altar of loyalty ; and this, it was said by PITT, would have been the case, but that he and his asso- ciates in the ministry, did not think it wise to suffer PAPER AGAINST GOLD. 135 loyalty so disinterested to experience any loss. An act, therefore, was passed for making good to the lenders whatever they would otherwise have lost by their ardent affection for their King and country, and loyalty was thus prevented from costing them anything. The case, however, of these loyal and devoted persons was somewhat different from that of the makers of the present loan. The Loyalty Loan men had never gained any thing by loan-making. They had not got their half million's worths of free- holds and their palace-like mansions. They had made a bargain, and they ought, in my opinion, to have been held to that bargain ; because, if there had been a gain instead of a loss, they would have put that gain in their pocket, and would, doubtless, have looked upon it as doubly blessed, being the profits of trade and of loyalty too ; and further, be- cause they had put their names down upon a list, which was to hold them forth to the world as men ready to make sacrifices for their King and country, in contradistinction to those, whose names were not put upon the list. But still, though nothing, in my opinion, can ever fully reconcile to principles of jus- tice, the compensating of these people for their losses by that loan, there is a great difference between that case, and the case of the present loan-makers or holders, who have no claim whatever to any com- pensation at all, or to any relief, or to the adoption of any measure, that shall cost the people one single shilling. If they lose by this loan, they have gained by other loans. If they cannot pay without the sale of their goods and chattels, why should not their goods and chattels be sold, as well as the goods and chattels of those, who, out of pure loyalty, have set up papers for the purpose of writing me down, and whose names I have never once mentioned, on whose papers I have never set my eyes, and who have killed themselves in their foolish attempts to wound me ? Why should not the loan-makers, if 136 PAPER AGAINST GOLD. they cannot make good their bargain, have their goods and chattels sold, us well as these loyalty- writers ? I am, however, reasoning here, against an unfounded surmise ; for it appears from the above quoted publications, that the family of BARING is very rich and in perfect credit, and that the concerns of GOLDSMIDT are in a flourishing way, seeing that his house is able to meet all the demands upon it, of every sort, without the least delay or hesitation. This being the case, there can be no need of any interference on the part of the Government, who will doubtless see, that the bargain is fulfilled agree- ably to the terms. I have now done with this accidental occurrence, the notice of which so much at length, forms a Di- gression from the regular line of our progress, but which, as we shall see by-and-by, will have alforded us practical knowledge, of great use in our future inquiries. I am, Gentlemen, Your faithful Friend, WM. COBBETT. State Prison, Newgate, Thursday, 6th Sept. 1810. LETTER X. "They" (the French Revolutionists) "forget that, in England, not one shilling of Paper Money of any description is received but of choice, that the whole has had its origin in cash, actually deposited ; and that it is convertible, at pleasure, in an instant, and without the smallest loss, into cash again. Our Paper is of value in commerce, because in law it is of none. It is powerful on Change, because in Westminster-hall it is impotent. In payment of a debt of twenty shillings, a creditor may refuse all the paper of the Bank of England. Nor is there among us a single public security, of any quality or nature whatsoever, that is en- forced by authority. In fact, it might be easily shown, that our paper wealth, instead of lessening the real coin, has a tendency to increase it. In- stead of being a substitute for money, it only facilitates its entry, its exit, and its circulation; that it is the symbol of prosperity, and not the badge of distress. Never was a scarcity of cash, and an exuberance of paper, a subject of complaint in this nation." Burke. Reflections on the French Revolution. Written and published in 171-0. PAPER AGAINST GOLD. 137 "But, whatever momentary relief, or aid, the Minister and the Bank might expect from this low contrivance of Five Pound Notes, it will in- crease the inability of the Lank to pay the Higher Notes, smd hasten the destruction of all ; for, even the small taxes that used to be paid in money, will now be paid in those notes, and the Bank will soon find it- self with scarcely any ofher money than what the hair-powder puinea- tax brinp* in." Fame's Decline and Ftill of (he English System of Pi- nance. Written and published in March, 1796. " When the situation of the B ink of England was under the consideration of the two Houses of Parliament, in the year 1797, it was my opinion, and that of many others, that the extent to which the Paper Currency had teen carried, was the first and principal, though not the sole cause, of the many difficulties to which that Corporate Body was then, and had, of late years, from time to time, been exposed, in supplying the cash necessary for the commerce of the kingdom. "-^Charles Jenkinson, Earl of Liverpool, Letter to the King, published in 1805. Horrid Passage from the Morning Post Newspaper Such are the Writers by whom the Paper-Money System and its Patrons are supported Such are the Answers that are given to these Letters Bank-Paper asserted to be the only Sort of Currency calculated to exert the Energies of an Island Proceed in tracing the increase of Debt and Notes to that Grand Effect, the Bank Stoppage Table showing the annual Increase of the Debt and Interest from 1793 to 1797 Increase in the Number and Amount of Payments at the Bank demanding Small Notes Hence came the Five Pound Notes Burke's Picture of the English Bank-Pa- per Paine' s Prediction Lord Liverpool the Historian of Paine' s Prophecy. GENTLEMEN, IN returning to our subject, we must bear m mind, that, in Letter VIII. and in the foregoing Letter, we saw clearly, that, bank-notes, as well as all other promissory notes, ought to be considered as repre sentatives of Debt^ while real money ought to be considered as the representative of property, or things of real value. At the close of Letter VIII., we saw how tbe increase in the quantity of bank- notes had kept pace with the increase of the Na- tional Debt ; and we proposed, when we should re- sume tbe subject, to trace this joint increase to that grand and memorable effect, THE STOPPAGE OF GOLD AND SILVER PAYMENTS AT THE BANK OF ENGLAND in 1797. But, before we enter upon this interesting matter, will you give me leave again to give you a specimen of the way in which my Letters are answered by 12* 138 PAPER AGAINST GOLD. the venal writers in London? To do this will not be without its utility, both now and hereafter. It will be useful to show you what sort of writers those are, who are opposed to me ; and, though it may not be so useful to posterity, it will, nevertheless, be of some use, and will be very curious, for our children to see what manner of men those were, who wrote in favour of the Paper-Money System. The passage I am about to lay before you was published in a newspaper, printed for the use of " The Fashionable World" under the date of the 6th of this month, and its words are these. " To the People of the United Kingdom. The detestable characters ex- posed lately in the pillory, may be considered the real representatives of the Corsican Tyrant and his Ministers, who boast of the monstrous vice which excites such horrors in every British bosom, and who, fearful of your valour, are exerting every artifice to subvert your empire, betray your virtue, and extirpate your people. COBBETT, the oracle of the Jacobins, abuses the British Papers for speak- ing ill of such infamous monsters, whose detesta- ble practices must annihilate every virtuous princi- ple from the human breast ; and he tells the British People, in effect, that, if they are to be robbed by taxes, and oppressed by power, it is of no conse- quence whether they are conquered by a French Vere-street gang, or governed by a virtuous British Sovereign and his respectable ministers. Such is the profound reasoning of an apostate low-minded scribe, who is impelled by a savage passion to re- venge for ministerial deserved contempt, and by foolish and base hopes of conciliation with the Cor- sican Monster, who often rewards, but never has been known to forgive. He publishes weekly an in- fernal Register, to excite mutiny in the army and the fleet, to seduce the loyalty of British subjects, to confound, the good sense of the yeomanry by low cunning and artful sophistry ; and above all, to destroy Public Credit and Bank Paper, as the best PAPER AGAINST GOLD. 130 bond of individual and public security, and the only medium of currency to suit and exert the energies of an insular and commercial people, Such a man, whom reading and writing made a corporal, but whom sense and reason will never make a politician or an honest patriot, may be the proper oracle of a Vert-street gang of legal French ruffians, but his councils of liberty, eco- nomy, and reform, must be regarded as the treache- rous delusions of a French spy, when offered to a free, virtuous, and happy nation !"* Such, Gentlemen, is the language of my opposers. Such is the sort of men who dislike me. Such are the answers that are given to my statements and my reasoning upon a sober and most important sub- ject of political economy. The abuse here heaped upon a person whom our commander in Portugal, in his public despatches, recognises as an " Emperor" and who, in our courts of justice, has been recog- nised as a " Sovereign of France," to say nothing of our negotiations and treaties with him ; the abuse here heaped upon Napoleon, who is not only called a monster, but is distinctly charged with " boasting of the monstrous vice," for being guilty of which, several infamous wretches have lately stood in the pillory in London, can, surely, not meet with the approbation of any man upon earth j for one would fain hope, that there is not another man like this writer. Yet is it a serious consideration for the country, that such an accusation should be thus boldly put forth in our public newspapers, and in a newspaper, too, which, from its uniform praises of the men at present in power, is called a ministerial newspaper, and is, in general, looked upon as a sort of halt official print. As far as concerns this par- ticular article, every man in England will be ready to acquit the ministers ; and, indeed, every man will readily believe that it must meet with their sincere * MORNING POST, Saturday, Oct. 6th, 1810. 140 PAPER AGAINST GOLD. reprobation. But, this may not be the opinion abroad ; and I leave you to guess what an impres- sion such a publication is calculated to give the world of our national character. There is one declaration here, about the paper- money, that I wish you to bear in mind ; namely, that " bank-paper is the best bond of individual and public security, and the only medium of cur- rency to suit and exert the energies of an insular and commercial people" So that, according to this writer, the return of gold and silver would be no good at all, and we ought, indeed, to desire to get rid of it, if we had any ; though, upon the trial of DE YONGE, (of which we shall see more by-and- by,) both the Attorney General and the Judge so de- cidedly declared the exportation of the coin to be a most mischievous practice ; and, though this wri- ter himself, little more than two months ago, con- gratulated his readers upon the prospect of seeing bank-paper destroyed, which paper he called, in his print of the 19th of July, " destructive assignats" and afterwards, " vile dirty rags ;" aye, that very paper, which he now asserts to be " the best bond of individual and public security, and the only medium of currency to suit and exert the energies of an in- sular and commercial people." Let us now leave our opponents ; let us leave the paper-money system and its patrons to receive all the support that writings like the above can give, while we proceed in tracing the increase of the National Debt, and that of the bank notes, to that grand and memorable effect, the stoppage of gold and silver- payments at the Bank of England in 1797, from which time our paper-money began, because it was then that the bank notes ceased to be convertible into coin, and they have remained in that state to this day. We have already seen, that, at the beginning of PITT'S war with the Republicans of France in 1793, cur National Debt amounted to about 250 millions, PAPER AGAINST GOLD. 141 because it did not increase during the peace prece- ding that war. Its amount, at the close of the Ame- rican war, was 257 millions, (See Letter III. page 43,) and the annual interest paid upon it was 9 mil- lions and about a half. The debt, and, of course, the interest along with it, decreased a little before the beginning of PITT'S war against the Jacobins of France ; so that, when that war was begun, both Debt and Interest were somewhat less than at the conclusion of the American war. We will, however, take them at what they were at the last-mentioned period; and, in order the more clearly to shew the progress of the cause of the great increase of bank- notes, and finally, of the Stoppage of Gold and Sil- ver-payments ai the Bank, we will state the annual increase of the Debt and Interest, from the begin- ning of the war to the year 1797, when the Stoppage took place ; which statement is not only very cu- rious, but is of singularly great importance. Before the Anti-Jacobin war began (in 1793,) the amount was . . In that same year was added . . Amount at the end of 1793 . . . In the year 1794 was added . . Amount at the end of 1794 . . . In the year 1795 was added . . . Amount at the end of 1795 . . . In the year 1796 was added . . . Amount at the end of 1796 . . . In the year 1797 was added . . . Amount at the end of 1797 . . . *413,140,831 17,015,149 DEBT. . 257,213,043 6,250,000 INTEREST. . 9,669,435 252,812 263,463,043 15,676,525 9,922,247 773,324 279,139,567 25,609,897 10,695,571 1,227,415 304,749,464 41,303,699 11,922,986 1,850,373 346,053,163 67,087,668 13,773,359 3,241,790 Thus, then, we see, that the first four years and a * To convert these sums into United States' Money, see page 44. 142 PAPER AGAINST GOLD. half of PITT'S war with the Jacobins, or Republi- cans of France, nearly doubled the Debt and the In- terest, or (which is the same thing to the people,) the annual charge on account of Debt, which, to- gether with interest, includes management and Sink- ing-Fund allowance. Four years and a half of the Anti-Jacobin war nearly doubled these ; and, accord- ing to the principles we have before laid down in Letters VII. and VIII., the bank notes would necessa- rily increase in the same proportion as the Debt and Interest increased ; because, every quarter of a year, the dividends to be paid at the Bank became greater and greater. Before the Anti-Jacobin war began, the dividends of a year amounted, as we see above, to 9,669,435/. To obviate all pettifogging cavil here, let me state, that this sum was not wholly dividends, or interest ; but consisted, partly, of " charges for management" paid to the Bank of England ; and also of charges on " account of the Sinking-Fund" But, as was observed before, this is of no consequence to the people who pay the taxes, out of which the whole sum comes ; and I only make the distinction to avoid a cavilling charge of misrepresentation, or error. When, therefore, we speak of the amount of the In- terest of the National Debt, let it be understood, that we include these charges ; and that, by the word In- terest, is meant the annual charge on account of the Debt. To resume, then ; before the Anti-Jacobin war began, the dividends, or interest, of one year amount- ed, as we have seen, to 9,669,435 pounds; and be- fore the nation got to the end of the fifth year of that war, a year's dividends, or interest, amounted to 17,015,149 pounds ; not much short of double. The Bank, therefore, having nearly twice as much to pay yearly in interest of the Debt ; having, to speak in round numbers, 17 millions to pay under this head, where it had but 9 millions to pay before the begin- ning of PITT'S Ant i- Jacobin war j having twice is PAPER AGAINST GOLD. 143 much to issue on this great score as it had previous to the war, was, of course, compelled to increase the quantity of its paper-promises, or the quantity of its Gold and Silver-coin ; because, as we have be- fore seen, (Letter VII. page 91,) an increase in the number and amount of payments must necessarily demand an increase of the money, or medium, in which those payments are made ; and, why this in- crease, at the Bank of England, would take place in paper-promises, and not in Gold and Silver coin, we have seen in Letters VII. and VIII. ; where it was shown that an increase of Debt must produce an increase of paper-promises, or notes, when once a paper-system has begun. That the experience of the times of which we arc now speaking, perfectly corresponded with the prin- ciples here stated, we shall now see, by adverting a little to the manner in which the payments of in- terest at the Bank were formerly made. It has before been observed, that, when the Na- tional Debt first began, the whole of the Interest was paid in Gold and Silver, there being then no such thing as bank notes, and no such thing- as a Bank, in this country. It has also been observed, that, very shortly after the Debt came into existence, it produced its natural offspring, a Bank, which issued its pro- missory notes ; and in which promissory notes tho interest of the Debt was, in part, at least, paid. At Jirst, it appears, that the Bank paid an interest upon its notes, or bills ; but, this was soon left off; and, from that time, the bank notes, or bills, became part of the circulating medium of the country. When the Stock owners, or Public creditors, as they are sometimes called, went to the Bank to re- ceive their dividends, or interest, they might have either bank notes, or Gold and Silver, according to their choice. Some persons chose the coin, and some the paper. But as the Debt increased, and, of course, the amount of the dividends, or interest, it was evident, from what has already been said, thai 144 PAPER AGAINST GOLD. the Bank would possess a less and less quantity of Gold and Silver in proportion to the quantity of its paper. And, further, the payments of interest hay- ing, as we have seen above, become nearly double in amount to what they were in 1793, previous to the Anti- Jacobin war, it is natural to suppose, that there would be double the number of Stock-holders, and, of course, double the number of payments to make. Therefore, as, at every payment, the re- ceiver has his choice of paper, or Gold and Silver- coin, there were double the number of chances against the bank ; and, at any rate, as there were, as yet, no bank notes of an amount less than TEN POUNDS, there must necessarily be, upon every pay- ment, an issue of Gold and Silver from the Bank, to the amount of every demand, or part of a demand, falling- short of ten pounds. This the bank could bear before the Anti-Jacobin war; but, when that war had nearly doubled the Debt, the Interest, and the number of the payments, on account of Interest; when this increase had taken place, the Bank found it necessary, not only to aug- ment the general quantity of its notes ; it found it ne- cessary not only to add to the total amount of its notes ; that is to say, to put out a greater sum in notes, than it had out before the Anti-Jacobin war ; but it also found it necessary to put out some notes of a lower amount than it already had, in order to pay the parts of ten pounds, which we have just mentioned. Hence came the FIVE POUND NOTES. And you will perceive, Gentlemen, that causes precisely si- milar had formerly produced the FIFTEEN POUND NOTES and the TEN POUND Notes ; namely, an in- crease of the National Debt, and, of course, an in- crease of the dividends, or interest; these being al- ways paid at the Bank, after the establishment of the Bank Company. Here let us stop for a little, and look back at the MOTTO, or rather MOTTOS, to this Letter. In the FIRST, the passage from BUKKE, we have a PAPER AGAINST GOLD. 145 picture of English Bank Paper previous to the war ; aye, to that very war, which that very picture and others in the same publication greatly tended to pro- duce, and were, without, I believe, any bad motive, intended to produce. Look well at that picture, Gentlemen. Look at the triumphant contrast there exhibited between the money of England and that of France, which latter country had then a paper- money. And, when you have viewed that picture in all its parts ; when you have fully examined the con- trast ; then turn your eyes to what is now exhibited to the world ; then see what English Bank-Paper now is, and what, in this regard, is the state of France, where all the paper-money has, long ago, been destroyed, and where there is no currency but that of Gold and Silver-coin, part of which coin con- sists of English Guineas, those guineas the absence of which all men of sense and of public spirit so sorely lament, and the practicability of causing the return of which is, as you will bear in mind, the chief object of our inquiries. In the SECOND motto, the passage from PAINE, (the mortal antagonist of Burke as to every thing else,) we have an opinion as to the consequences of the Bank having made Five Pound notes. We have a prediction as to the inability which it will produce in the Bank to pay its higher notes. This predic- tion was, it appears, written in March, 1796, and it was published in England, in, or about, the month of June of that year ; which was, as we shall see by-and-by, only about nine months before the stop- page of gold and silver-payments at the Bank ac- tually took place. In the THIRD motto, the passage from the late Lord LIVERPOOL, we have the opinion, not only of the writer himself, who upon such a matter, is no very mean authority, but, as he asserts, of many others, (doubtless, persons of distinction, as to rank, at least ;) we have an opinion, thus sanctioned, that the increase of the paper currency was the first 13 146 PAPER AGAINST GOLD. and principal cause of the Stoppage of Gold and Silver payments at the Bank ; and which opinion perfectly corresponds with that of PAINE, there be- ing this distinction in the merits of the two writers, that Lord Liverpool only recorded what PAINE had foretold : the former was the historian, the latter the prophet ; and it is not a little curious, that Lord Li- verpool, a clerk in whose office had written, under a feigned name, a sham life of PAINE, should become the recorder of the truth of PAINE'S predictions, and that, too, in " a Letter to the King," in whose name the very work containing the predictions had been prosecuted as A LIBEL. Here are three writers, all of great understanding and experience, and the two former of abilities scarcely ever surpassed in any age or country, all opposed to each other as to every other question ; each one hating the other two, and each one hating the other one : yet all agreeing as harmoniously as their bones would now agree, if they happened to be tumbled together ; all agreeing as to these principles respecting paper-money. Having now traced the increase of the Debt down to the putting forth of the Five Pound bank notes, we will rest here, and resume the subject in OUT next. I am, Gentlemen, Your faithful friend, WM. COBBETT. State Prison, Newgate, Monday, 8th Oct. 1810. I PAPER AGAINST GOLD. 147 LETTER XL "These Jive pound-notes will circulate chiefly among little shop-keepers, butchers, bakers, market-people, renters of small nouses, lodgers, &c. All the high departments of commerce, and the affluent stations of life were already overstocked, as Smith expresses it, with the bank notes. No place remained open wherein to crowd an additional quantity of bank notes but among the class of people I have just mentioned, and the means of doing this could be best effected by coining Five Pound- notes. But no new supplies of money can, as we said before, now arrive at the Bank, as all the taxes will be paid in paper. What, then, would be the consequence, were the Public Creditors to demand pay- ment of their Dividends in Cash, or demand Cash for the bank notes in which the Dividends are paid ; a circumstance always liable to hap- pen." Fame. Decline and Fall of the English System of Finance. Pub- lished in 1796. " I should stop here, but there is a subject of so great importance, and so nearly connected with the Coins of your Majesty's realm, that I should not discharge my duty if I left it wholly unnoticed ; I mean what is now caljed Paper currency; which is carried to so great an extent, that it is become highly inconvenient to your Majesty's subjects, and may prove, in its consequences, if no remedy is applied, dangerous to the credit of the Kingdom. It is certain, that the smaller Notes of the Bank of England, and those issued by country Bankers, have supplanted the Gold Coin?, usurped their functions, and driven a great part of them out of circulation : in some parts of Great Britain, and especially in the southern parts of Ireland, small Notes have been issued to supply the place of Silver Coins, of which there is certainly a great deficiency." Charle* Jenkinson, Earl of Liverpool, Letter to the King. Published in 1805. Progress from FIVE to ONE Pound-Notes Suspicion begun soon after the FIVE Pound-Notes Paine' s Prediction as to People going to the Bank Lord Liverpool's Opinion agree- ing with that of Mr. Paine History of the Bank Stoppage of Gold and Silver Payments Enormous increase of the Debt in 1797 Other cause Alarmists Meeting of Parlia- ment in Oct. 1796 Alarm of Invasion Arming Acts Mr. Fox's Opinion of the Alarm Exaggerated Representations of the Venal Prints French Fleet appears oil the coast of Ireland Effect of the Alarm begins to be felt at the Bank of England Venal Prints change their Tone all of a sud- den, and accuse the Jacpbins of exciting Alarm Run upon, the Bank becomes serious Increased by a Report of a French Fleet, with Troops on board, being oil Beachy Head Followed immediately by the landing of Tate and his Raggamumns in Wales Bank receives its finishing blow Vain attempts to check the Run upon the Bank Order oC Council issued Disappointment of the Crowd at the Bank, in Threadneedle- Street. GENTLEMEN, IN the foregoing Letter, we traced the National Debt, and the Interest thereon, in their progressive 148 PAPER AGAINST GOLD. increase from the year 1793 to 1797 inclusive, m which latter year we shall find that the stoppage of Gold and Silver payments, at the Bank of England, took place. We have seen that, in the course of the aforementioned period, the amount of Debt and In- terest was nearly doubled ; we have seen that the Bank of England had, of course, nearly double the sum to pay in dividends, or interest ; we have seen how this increase of payments at the Bank of Eng- land produced a new family of notes, so low in amount as FIVE POUNDS j there having been, before the Anti-Jacobin War, no Bank Notes under TEN POUNDS ; we shall soon see how the same still-grow- ing and ever-prolific cause brought forth, at last, a still more numerous and more diminutive litter ; and, when we have gone through the history of the Two and ONE Pound Notes, we shall want scarcely any thing further to convince us, that, in such a state of things, it was next to impossible for Gold and Silver to remain in circulation. fr It was observed in Letter L, page 24, that when notes, so low in amount as FIVE POUNDS came to be issued ; when rents, salaries, yearly wages, and al- most all the taxes came to be paid in paper ; when this became the case, and when, of course, every part of the people, except the very poorest, possessed occasionally, bank notes, it was impossible that men should not begin to think, that there was some dif- ference between Gold and Silver, and bank notes, and that they should not become more desirous to possess the former than the latter. In other words it was impossible that men should not begin to have some suspicion relative to the bank notes ; and, it is very clear, that the moment such suspicion arises, there is an end to any paper-money which is conver- tible into Gold and Silver at the will of the bearer, who will, of course, lose not an instant in turning that of which he has a suspicion ("however slight,) into that of which it is impossible for any one to have a suspicion. PAPER AGAINST GOLD. 149 Thus it happened in 1797, as PAINE, in his pamph- let, published only the year before, had foretold, in the words of the first of my mottos to this Letter. He there told his readers how the issuing of the Five Pound notes would operate ; he pointed out how this measure would keep real money from the Bank ; and he asked what must be the consequence, if (as it might any day happen) the people should go to the Bank, and demand cash for the notes. This did happen the very next year; and, as he foretold in another part of his pamphlet, those who went to present their notes first, came best off. Lord LIVERPOOL, in the passage which I have selected for my second motto to this Letter, had, when he wrote, seen the thing happen ; he had seen the fulfilment of what Mr. PAINE had foretold, and spoke, there- fore, of the " dangerous" consequences of an ex- cessive issue of paper, with the fact before his eyes. Experience, which, says the proverb, "makes fools wise," had taught his Lordship in 1805, what he might have learned from Mr. PAINE in 1796. Ne- vertheless, the opinions of Lord Liverpool have some weight, and are worthy of attention with us in England ; because, though his talents and mind were of a cast quite inferior to those of such men as HUME and PAINE and BURKE, and though there is nothing in what he has said, which I had not said, in the Register, years before ; still, as being a man of great experience in business, as having, during the whole reign, been a great favourite at court, and, especially, as having, upon this occasion, ad- dressed himself directly to the King ; his opinions, though of no consequence elsewhere, are worthy of some notice in this country, and may possibly, in some minds, tend to produce that conviction, which, in the "same minds, a stupid and incorrigible preju- dice would have prevented from being produced, by all the powers of HUME or PAINE. But we must now return to the Bank, and see how it happened, that the people went to demand money 13* 150 PAPER AGAINST GOLD. in payment of the notes in 1797. That it did hap- pen, we all know ; but, there are not a few of the people forming the present population of the coun- try, who have forgotten, or who have never known, the true history of the Stoppage of Gold and Silver payments at the Bank oj England ; yet, without a knowledge of this history, and a thorough know- ledge of it too. we cannot possibly pursue our inqui- ries to a satisfactory result. We have seen abundant arguments to prove, that paper-money, that promissory paper of every sort, is the offspring and representative of Debt ; that a Na- tional, or Public Debt, never can fail to bring forth bank notes, or paper-promises, of some sort or other ; that, of course, as the Debt increases, and its inte- rest increases, there will be, and must be, an increase of the paper in which that interest is paid ; and, in the last Letter, p. 141, we saw, in the Table of In- crease of the Debt and Interest, from the beginning of the Anti-Jacobin War, to the year 1797; we here saw, in practice, the cause of the making of the FIVE POUND bank notes. But, as we have since seen, that measure was not sufficient. We saw, at p. 145, that it was to avoid paying in Gold and Silver, the sums, or parts of sums, from TEN to FIVE pounds, which must have induced the Bank to make and put out notes so low as FIVE POUNDS. If you look again at that Table, gentlemen, you will see how the increase went on; you will see that it \vzsgreater and greater every year. In the year 1793, the ad- dition of the annual interest was, (speaking in round numbers,) only 250 thousand pounds ; but, in the year 1797, the addition was, 3-}- millions ; that is to say, a third part of as much as the whole amount of the interest previous to the Anti- Jacobin war. Thus did this war of PITT against the Republicans of France cost, in only one year, nearly as much, in addition to Debt, as the cost of the whole of the American War, the extravagant expenditure of which had, till now, been proverbial. PAPER AGAINST GOLD. 151 There were, however, other causes at work, at the time of which we are now speaking ; causes opera- ting upon the paper system from without; causes which must be here fully stated ; for, besides that a knowledge of them is essential to our inquiry, it is demanded by justice towards those who opposed the ruinous measures of PITT, and who foretold their consequences ; and this demand is, in a peculiar manner, addressed to ME, who, from being so situ- ated as to be unable to come at, or even suspect, the truth, while many circumstances conspired to make me take for truth that which was false, was not only one of the dupes of the system, but who, unintention- ally, contributed according to the degree of my ta- lents, towards the extension of the circle of duplicity. Credit is a thing wholly dependent upon opinio The word, itself, indeed, has the same meaning \ the word belief. As long as men believe in the riches of any individual, or any company, so long he or they possess all the advantages of riches. But when once suspicion is excited, no matter from what cause, the credit is shaken : and a very little matter oversets it. So long as the belief is impli- cit , the person towards whom it exists, goes on, not only with all the appearances, but with all the ad- vantages of wealth ; though, at the same time, he be insolvent. But if his wealth be not solid; if he have merely the appearance of wealth; if he be unable to pay so much as he owes, or-, in other words, if he be insolvent, which means neither more nor less than unable to pay ; when an indivi- dual is in this situation, he is liable, at any moment, to have his insolvency exposed. Any accident that excites alarm in the minds of his creditors, brings the whole upon him at once; and he, who might otherwise have gone on for years, is slopped in au instant. Thus it will happen to companies of traders, as well as to individuals ; and thus it did happen to the Bank Company, at the time we are speaking of, 152 PAPER AGAINST GOLD. and at which time an alarm of invasion prevailed through the country. From the very out-set of the war, the inventors and supporters of it had been, from time to time, propagating alarms of various sorts ; by the means of which alarms, whether they themselves believed in them or not, they were enabled to do things, which had never before been either known or heard of in England. The mode of reasoning with the people was this. You see, that, in France, the re- volution has deprived the people of both property and life ; there are those who wish to cause a revo- lution in England : the measures taken, or proposed, are absolutely necessary to prevent the accomplish- ment of this wish : therefore, you have your choice, either to submit quietly to these measures, whatever portion of your liberty or property they may take away, or let in upon you a revolution which will take away all your property and your lives into the bargain. There was no room for hesitation; and thus were the people determined, and with this view of the matter, did they proceed, until the time above referred to ; the ministers being, probably, full as much alarmed as the people, and certainly not with less cause. At times, however, especially after the war had continued for three or four years, the effect of alarm seemed to grow very faint. Danger had been so often talked of. that, at last, it was grown familiar. In the year 1796, however, things began to wear a serious aspect. All the minister's predictions and promises had failed ; his allies, to whom, and for whose support, so many millions had been paid py the people of this country, had all laid down their arms, or had gone over to the side of France ; the assignats in France had been annihilated without producing any of the fatal consequences which PITT had so confidently anticipated, and upon which, in- deed, he had relied for success ; and a negotiation for peace, opened at the instance of England, had PAPER AGAINST GOLD. 153 produced nothing but a convincing proof of the high pretensions of the enemy, and of his confidence in his cause and resources. When the parliament met, therefore, in October, 1796, the ministers, and their adherents, seem to have been full of real apprehension. They failed not to renew the signal of a/arm, in which, indeed, they were kept in countenance by the enemy, who had openly declared his intention of invading the country. The subject was mentioned in the King's speech, upon a part of which a motion was grounded on the 18th of October, for the bringing in of Bills for the raising men with all possible speed, for the purpose of defending the country against invasion. In virtue of a resolution passed in consequence of this motion, three Acts were passed with all possible rapidity ; the first, for providing an augmentation for the militia, to be trained and exercised in a particular manner ; the second', for raising a certain number of men in the several counties of England and Scotland, (there were two Acts,) for the service of the. regular Army, and the Navy ; and the third, for raising a provisional force of cavalry, to be embodied, in case of necessity, for the defence of these kingdoms ;*' which Acts were finally passed on the llth of November, 1796. When this mea- sure was under discussion, Mr. Fox, Mr. SHERIDAN, and others, opposed it upon the ground of its not being necessary ; and Mr. Fox, who called it a re- quisition, after the French manner, observed that, if it was necessary to our safety, it was the conduct of the ministers, and of the last parliament, who confided in them, which had brought us into that miserable situation, " a parliament," he said, " which had done more to destroy every thing that is dear to us, than in better days would have entered into the mind of any Englishman to attempt, or to conceive ; a parliament, by whom the people had been drained 37 George III. Chapters 3, 4, 5, and 6. 154 PAPER AGAINST GOLD. so much, and from whom they had had so little be- nefit; a parliament that had diminished the dearest rights of the people so shamelessly and so wickedly ; a parliament, whose conduct it was that had given rise to this measure." Mr. Fox added, that he did not believe that invasion would render any such measure necessary ; that the real resources of the country consisted of the people's attachment to the constitution, and that, therefore, the proper measure to be adopted would be to allow them to possess the spirit of that constitution. The minister and his partizans contended, however, that there was real cause for alarm ; and PITT said, that as to the con- stitution, u it still possessed that esteem and admi- ration of the people, which would induce them to defend it against the designs of domestic foes, and the attempts of their foreign alii eg;" thus, accord- ing to his usual practice, proceeding upon the as- sumption, that there was a party in the country in alliance, as to wishes, at least, with the enemy. While these measures were before parliament, the venal part of the press was by no means inactive. Representations the most exaggerated were made use of in speaking of the temper and designs of the enemy, always insinuating that the opponents of the minister were ready to join the enemy, or, at least, wished him success. The French were exhibited as being quite prepared ; and a descent was held forth as something almost too horrible to be thought of. This was useful for the purpose of making the Arming Acts go down ; but the alarmists did not seem to be aware of its cutting another way ; and, least of all do they appear to have imagined, that it would set people to thinking of what effect invasion might produce upon bank notes. In the mean while, the negotiations for peace were broken off by the month of December, which gave rise to new alarm. This was soon followed by the appearance of a French naval force, with troops on board, off the coast of Ireland : and, though its PAPER AGAINST GOLD. 155 return back to France, without attempting a descent, might, one would think, have tended to quiet peo- ple's fears, it was, on the contrary, made ihe ground- work of still more general and more vociferous alarm. There were now no bounds to the exagge- rations of the venal prints. From the first week in January, (1797,) to the third week in February, the people were kept in a state of irritation hardly to be conceived. Addresses to them, in all shapes and sizes, were published, calling upon them to arm and come forth at once, not waiting for the slow process of the Militia and Cavalry Acts. Already, were we told, " the opposite coast was crowded with hostile arms : forests of bayonets glistened in the sun ; de- spair and horror were coming in the rear." It was next to impossible that this should not make people think of what was to become of them ; make them reflect a little as to what they were to do in case of invasion ; and it required but very little reflection to convince them, that money, at all times useful, would, in such a case be more useful than ever. Whence, by a very natural and easy transition, they would be led to contemplate the possibility of real money being rather better than paper. That's enough ! There needs no more ! Away, in an in- stant, they go to the Bank, where the written promi- ses tell them the bearer shall be paid on demand. This effect of the alarm, an effect of which neither PITT nor any of his adherents seem ever to have had the smallest suspicion, and, indeed, when Mr. Fox cautioned them against it, they affected to laugh at what he said ; this effect of the alarm, raised and kept up by the minister and the great Loaners and men of that description ; this effect of the alarm be- gan, it appears, to be sensibly felt, at the Bank of England, immediately after the appearance of the French fleet off the coast of Ireland ; and, as it after- wards appeared from official documents, the drain had become so great by the end of the third week in February, that the Directors saw the impossibility of 156 PAPER AGAINST GOLD. going on, unless something could be done to put a stop, or, at least, greatly to check, the run upon them for cash. The people were, in short, now doing precisely what PAINE, only about ten or eleven months before, had advised them to do, and the con- sequence was precisely what he had predicted. It was now extremely curious to hear the language of the venal newspapers, who had, for months be- fore, been endeavouring to excite alarm, and who abused Mr. Fox and his party, called them Jacobins and, sometimes, traitors, because they said that the alarm was false, and was invented for bad purposes These very news-papers now took the other side. They not only themselves said, that the alarm was groundless; but they had the impudence, the unpa- ralleled, the atrocious impudence, to accuse the Ja- cobins, as they called them, of having excited the alarm, for the purpose of injuring public credit ! This change of tone was begun on the 17th of February by those notoriously venal prints, those prints so far famed above all others in the annals of venality ; the "TRUE BRITON," and the " SUN." The thing was begun in " An Address to JOHN BULL," in which the "most thinking people," who were still in frying confusion to get on with the levies of additional militia, and parish-men for the army and navy, and the provisional cavalry ; the " most thinking people," while all hurry and bustle about this, were told by these shameless writers, who had almost called the people traitors for not making greater haste to arm ; the people were, by these same writers, now told, that alarm might be pushed too far ; that, if so pushed, it might do us an injury equal to invasion ; that every one must see, that the French wished to ruin our credit ; that, of course, to show an eagerness to sell out of the funds was to favour the designs of the enemy ; that it was, be- sides, the greatest nonsense in the world for peo- ple to suppose that their property was not safe in the Bank of England ; that no apprehension need PAPER AGAINST GOLD. 157 be felt, and that the people who had money in the funds, might safely rely upon the wooden walls of Old England. Though, observe, the whole coun- try was actually in movement, down to the very beadles, in order to raise men for defence by land. " The evidence of facts" was before the people's eyes. The alarm was not to be allayed by assertions like these. And though the venal prints grew more and more positive in their assurances, that there was now no danger from invasion; though they (on the 21st of February) assured the people, that it was " an error to suppose that the enemy was at our gates," and that " & panic might do infinite mischief to public credit," people still keep carrying their notes softly to Threadneedle-street, they kept on selling out of the Stocks : and a report, on the day last mentioned, of the appearance of a French fleet with Troops on board, off BEACHY HEAD,* immediately followed by the famous landing of TATE and his handful of rag- gamuffins in WALES,! appears to have given confi- dence in bank-paper the finishing blow. * " PORTSMOUTH, FEB. 20. An account reached this place, this morning at half past ten, A. M. of several French trans- ports, convoyed by armed vessels, having been seen off B "eachy Head. The intelligence came by the signal posts, and Admi- ral Sir P. Parker, immediately on receiving it, ordered two ships of the line and five frigates to slip their cables and pro- ceed to sea. This squadron is now out of sight, and all the other ships are getting in readiness. The sensation that this made in the City may be easily conceived. It spread a very general alarm ; but it was soon contradicted. Letters, written as the post was setting out, stated that the alarm had been occasioned by a mistaken signal, and that instead of a fleet of 300 French transports, it was no more than a sig- nal, that 3 privateers had been discovered oft'Beachy Head. Such, however, are the consequences of the state of alarm into which Government has thrown the country by a threaten' ed Invasion." MORNING CHRONICLE, 22 Feb., 1797. t "On "Saturday the public mind received the shock of a new alarm. An express arrived from Lord Milford, inform- ing the King's ministers that a body of French troops, amount- ing to about 1200. had been landed at Fisgardoutof the ships which we stated had approached the coast of Pembroke. Ministers took the earliest opportunity of announcing the fact to the Lord Mayor." MORNING CHRONICLE, 26 February, 1797. 14 158 PAPER AGAINST GOLD. All, as appears from the documents, and as we shall by-and-by see, was consternation in Thread- needle-street. The diminution of the gold became greater and greater every day. In vain did the ve- nal prints cry out against alarm. They had cried " wolf," 'till" the people had believed them. They had called upon them to " stand forward in defence of the constitution," 'till they had convinced them it was time for every man to think a little about ta- king care of himself. In vain did these venal wri- ters now call aloud against alarm ; in vain did they say, (24th February,) that the Beachy-Head report " arose from a mistake in the signals ; that the resour- ces of the country were undiminished ; that it was degrading to suppose that we had not a sufficient force to annihilate the enemy ; that the panic was shameful, unmanly, mean, and dastardly ;" in vain did they assert (24th February) that " invasion was more to be desired than dreaded ;' : in vain did they exclaim : " Let us, for God's sake, not give way to our fears so as to injure public credit." In vain did they (25th February) aver, " that the alarm was groundless ; that they were sure no attack was meditated ; and that they were convinced it never would be." In vain did they again exclaim; "for God's sake let not the gloomy despondency of a few men in the city give a fatal blow to public credit." In vain were all these efforts : SUSPICION, to use PAINE'S emphatical expression, was no longer ASLEEP. It was broad awake, and to stay its operations was impossible. To excite fears in the breasts of the people was a task to which the venal prints had been adequate ; but to remove those fears, or to im- pede the progress of their effects upon the mind, was too much for any human power to accomplish. The run upon the Bank continued to increase, until the day last mentioned, Saturday, the 25th of February, 1797 ; a day which will long be remembered, and which will be amongst the most memorable in the PAPER AGAINST GOLD. 159 annals of England, as being the last (hitherto at least) on which the bank of England was compelled, at the will of the bearer, to pay its promissory notes in gold and silver, agreeably to the tenor of those notes ; until the evening of that day the run contin- ued, but, on the next, though it was Sunday, an Order was issued from the PRIVY COUNCIL requiring the Directors of the Bank to forbear issuing any cash in payment, until the sense of Parliament could be taken upon the subject ; which memorable instrument was in the following words,* to which I must beg of you, Gentlemen, to pay particular atten- tion. * At the Council Chamber, Whitehall, February 26, 1797. By the LORDS of his MAJESTY'S Most Honourable PRIVY COUNCIL.-(Present,) The LORD CHANCELLOR (Rosslyn,) LORD PRESIDENT, DUKE of PORTLAND, MARQUIS CORNWALUS, EARL SPENCER, EARL of LIVERPOOL (Charles Jenkinson,) LORD GRENVILLE, MR. CHANCELLOR of the EXCHEQUER. Upon the representation of the Chancellor of the Exchequer^ stating, that from the result of the information which he has received, and of the inquiries which it has been his duty to make, respecting the effect of the unusual demands for spe- cie that have been made upon the metropolis, in consequence of ill-founded or exaggerated alarms in different parts of the country, it appears that unless some measure is immediately taken, there may be reason to apprehend a want of a sufficient supply of cash to answer the exigencies of the public service. It is the unanimous opinion of the Board, that it is indispen- sably necessary for the public service, that the Directors of the Bank of England should forbear issuing any cash in payment until the sense of Parliament can be taken on that subject, and the proper measures adopted thereupon, for maintaining the means of circulation, and supporting the public and commercial credit of the kingdom at this impor- tant conjuncture ; and it is ordered, that a copy of this minute be transmitted to the Directors of the Bank of England, and they are hereby required, on the grounds of the exigency of the case, to conform thereto until the sense of Parliament can be taken as aforesaid. W. FAWKENER. 160 PAPER AGAINST GOLD. We shall, by-and-by, see whence it was that " Mr. Chancellor of the Exchequer" received his inform- ation, and what sort of information it was that he did receive ; but, for the present, we will, in order to avoid making this Letter too long, content our- selves with seeing what the Bank Company did in consequence of this Order not to pay their credi- tors ; this requisition not to pay their promissory notes when presented ; this Order to forbear issu- ing cash in payment. The run had been very great on the Saturday, and people would scarcely suspect, that the Sunday, especially by such a godly ministry as PITT'S was, would have been spent in labour of any sort. It would, however, naturally give people time to think a little ; it would afford them leisure to reflect on the consequences of being without a farthing ot cash in case of invasion. Accordingly, on the Monday morning, they appear to have been quite prepared for furnishing themselves with real money, if it was to be had at the Bank. Let us, however, as to this fact, take the words of the venal writers themselves. " Yesterday-morning," says the TRUE BRITON of Tuesday, the 28th of February, " a great run seem- ed to have been meditated upon the Bank, as A CROWD OF PEOPLE ASSEMBLED THERE AS SOON AS THE DOORS OPENED. This design was HAPPILY defeated by a Resolution of the Privy Council, transmitted to the Bank Directors on Sunday ; and. in consequence, they^ had Hand- bills ready for delivery, a copy of which, with the Order of the Privy Council annexed, our readers will find, as an Advertisement, in the front of our Paper."* * Bank of England, February 27, 1797. In consequence of an order of his Majesty's Privy Council notified to the Bank last night, a copy of which is hereunto annexed. The Governor, Deputy Governor, and Directors of the Bank of England think it their duty to inform the Propri- etors of Bank Stock, as well as the Public at large, that the PAPER AGAINST GOLD. 161 Such, Gentlemen, was the manner in which the Stoppage of Gold and Silver payments at the Bank of England took place ; such was the manner of that event, which produced the evils, for which the Bullion Committee have proposed a remedy. Upon the Order of Council there is much to observe, be- fore we proceed further ; but, having laid before you a plain narrative of the event, it will be best to re- serve those observations, till my next ; and, in the meanwhile, I remain. Gentlemen, Your sincere friend, WM. COBBETT. State Prison Newgate, Monday, 15th October, 18 10. LETTER XII. " Every victim of injustice and cruelty," (speaking of the French Govern- ment,) " bequeaths his revenge to his connexions, to his friends, and to his relations ; or (if all these should be involved in the same common fate with himself) every such execution raises detestation and abhorrence, even in the breasts of ordinary spectators, and unites the public opinion against a Government, which exists only by the daily practice of robbery and mur- der. From this disgusting scene, let us turn our eyes toowr own situation, THERE the contrast is striking in all its parts. HERE we see nothing of f arbitra . the character and genius of arbitrary finance; none of the bold frau bankrupt power; none of the wild struggles and plunges of despotism in distress ; no lopping off from the capital of debt ; no suspension of interest; no robbery, under the name of loan ; no raising the value ; no debasing the substance of the coin. HERE we behold public credit of every description rising under all the disadvantages of a general war; an ample revenue flowing freely and copiously from the opulenc.e of a contented people." Lord Morni7bgton (now Marquis Wellesley.) Speech in the -House of Com- mons, 21st, January, 1794. " The -interest of the national funded debt is paid at the Bank In the same kind of paper in which the taxes are collected. When people find, as they will find, a reservedness among each other in giving gold and silver for bank notes, or the least preference for the former over the latter, they will go for payment to the Bank, where they have a right to go. They will do this as a measure of prudence, each one for himself, and the truth, or de- lusion of the funding system, will be then proved." Paine. Decline and Fall of the English System of Finance. Published in 1796. general "concerns of the Bank are in the most affluent and prosperous situation^ and such as to preclude every doubt as to the security of its notes. The Directors mean to continue their usual discounts for the accommodation of the Com- mercial Interest, paying the amount in Bank notcs^ and the Dividend Warrants will be paid in the same manner. FRANCIS MARTIN, Secretary 14* 162 PAPER AGAINST GOLD. " The great object, however, is to open the Bank of England, and to enable it to carry on its pecuniary transactions to the extent which its resources will admit of on the solid principle of giving either cash or paper at the option of the applicant. Until that is done, neither public nor private credit, nor agriculture, nor commerce, nor manufactures, nor the income of the na- tion, can go on prosperously." Sir John Sinclair. Letter, published in 1797. The Impression made upon the country by the Stoppage of Gold and Silver Payments at the Bank Ridiculous Situa- tion of the Ministers in complaining of False Alarms Ja- cobins now accused of causing the Run upon the Bank- Foolishness of this Accusation Mr. Wilberforce answered by Mr. Fox Now was the Time for Mr. Pitt's Adherents to leave him They had been warned by Mr. Fox and others King's Speech, and Language of the Minister at the Opening of the Session during which the Stoppage took place If the Minister's Adherents had now quitted him it migjit have prevented the present Dangers Mr. Pitt's Hu- miliation in the House of Commons Questions put to him upon the subject of the Legal Tender, by Mr. Combe and Mr. Nicholl's His Inability to determine on what Measures he should propose. GENTLEMEN, HAVING, agreeably to the Intention expressed, traced the increase of the Debt and of the Bank Notes down to that grand and memorable effect, the stoppage of Gold and Silver payments at the Bank of England, our next object must naturally be to know what impression that event produced upon the nation, and what measures were adopted in consequence of it ; in otber words, to continue the history of the stop- page down, to the time, when the evil of paper-money produced the forming of the Bullion Committee. The impression made upon the nation in general was such as might have been expected, after all the flattering accounts which had been given of the na- tional resources. The ORDER OF COUNCIL does, you \vill perceive, ascribe the event to " ill-founded and exaggerated alarms, in different parts of the coun- try." But, supposing this to have been the chief, and only cause, with what face could the ministers complain of these alarms ; seeing that they them- selves had done their utmost to excite them ? They had not only proposed, and carried through, the Arming Bills, but they had been writing to the ma- gistrates, in every part of the kingdom, calling upon PAPER AGAINST GOLD. 163 them for internal preparations "while" (Morning Chronicle, 22nd February, 1797) " Contractors had put every town into commotion by inquiries into the number of Ovens, the quantity of grain, and the State of the Provisions" Nay, the preamble of the Arming Acts itself proclaimed, that the mea- sures were become necessary, "in order to prevent, or repel, any attempt, which the enemies of the country might make to effect a descent upon the kingdom." After all this it was, that the Privy- Council spoke, in a sort of complaining tone, of " ill-founded and exaggerated alarms !" When the matter came before Parliament, the Opposition did, certainly, not spare the minister and his adhe- rents, who had the confidence to hold the same tone as to the alarm ; and whose opinion of the minds of the people was such, that they scrupled not to re- peat the assertions of the venal prints, and to ascribe the injury (Tor they then acknowledged it to be an Injury) which Public Credit had sustained, to un- founded alarms, excited by the internal enemies of the country, which, in, a contrary sense, some mem- bers were malicious enough to believe. GENERAL WALPOLE (in the Debate of the 1st of March) made an admirable exposure of them in this way, to which no answer was given, but that they were not always to feel alarm, because they had once felt it ; though the fact was that they were proclaiming alarm, with all their might, 'till the Bank, as if afterwards ap- peared, represented to them secretly, that the alarm, if continued, would take away all their cash. Mr. SHERIDAN, in adverting to the speech of GENERAL WALPOLE, who had remarked upon Mr. WINDHAM'S not having signed the Order of Council, said, " that he believed it proceeded from the reflections it con- tained Against the alarmists," and he added, that " even amidst the wreck of public credit, it was im- possible not to laugh at the juggling tricks and mi- serable shifts to which Ministers had recourse." The venal part of the press, now that it was im- 164 PAPER AGAINST GOLD. possible any longer to disguise the state of the credit of the Bank, began a regular new attack upon the Jacobins, whom it had before reviled for endeavour- ing to check the alarm, and whom it now accused of causing the alarm. The notoriously venal prints before mentioned, (TRUE BRITON and SUN,) which had, to the last moment, abused the Jacobins for (as they said) propagating the false notion of the Bank not having gold to answer their notes. These prints, never equalled in venality, I believe, by any prints in the world, the MORNING! POST only excepted, now abused those same unfortunate Jacobins for not ac- knowledging the necessity of the Order in Council. They (3rd March, 1797) again accused the Jacobins of having caused " a distrust of the Bank," and of having formed a design to ruin the credit of the country, in which, " they had so far succeeded, at least, as to persuade the people, in some parts oj the country, that gold was preferable to bank notes. Gentlemen, pause here for a moment, and contem- plate the foolishness as well as the injustice of such observations as these. You will bear in mind, that the Jacobins, as they were called, were, by these same writers, constantly represented as men without learning, without sense, without property, and, of course, without influence. How, then, were they to have the power of producing such an effect upon the minds of the nation ; and, upon the minds of those, too, who held the bank notes and who owned the Stock ? The Jacobins, as these venal prints had the impudence to call them, had not been able to per- suade the people to check Mr. PITT in his ruinous career of war and expenditure ; they had not been able to prevent any one of the measures of that Minister ; they had not been able to persuade the people to do any one thing that they wished them to do, and, at the very time we are speaking of, they were out-voted, in the Parliament, four to one. Yet, to these same Jacobins was now ascribed that run upon the Bank, which produced the Order in PAPER AGAINST GOLD. 165 Council ; which produced an order, issued by the King's Privy Council, to encourage a Company of Merchants to refuse, illegally, to pay their promis- sory notes, when duly presented. The Jacobins, as they were still called with a degree of impudence not to be adequately described ; the Jacobins, who were represented as defeated and put down, and as being held in abhorrence by the people, were never- theless, at the same moment, represented as having such power over the mind of that same people, as to cause them to make a run upon the Bank, which was called " stabbing the country in its vitals." Mr. Fox, in answer to Mr. WILBERFORCE, who (March 1, 1797) attributed " much of the public calamity to the conduct of the Opposition, and to the conduct of those who had proceeded to lengths which the Op- position would not avow,-" in answer to this Mr. Fox said : " this reminds me of a scene in Ben John- son, where it appears, that an Impostor had played his tricks very successfully for a long time upon his dupes, and, when he was detected, the dupes became very angry, not at the Impostor, but at those who had detected him." Now was the time for those, who had been de- luded into a support of Mr. PITT'S measures, to make a frank and manly acknowledgment of their error, and to join Mr. Fox in demanding a change of sys- tem. They had, when war was first contemplated, received the most solemn assurances, that the re- sources for vigorous preparation (at first prepara- tion only was talked of) were ample, even from the excess of the revenue ;* they had been, when, after the war had begun and had brought, at once, very disastrous effects as to pecuniary matters, told that those effects were completely removed, and that the * " Gentlemen of the House of Commons, It is a great consolation to me to reflect, that you will. find ample resources for effectually defraying the expenses of vigorous preparations from the excess of the actual revenue beyond the ordinary expenditure" KING'S SPEECH, Dec. 13th, 1792. 166 PAPER AGAINST GOLD. revenue was in a favourable state /* they had been told, that the war could not he of long duration; they had been told, that the situation of France, in every respect, and especially in respect to her finances, was desperate beyond description ; the French system had been repeatedly described to them as one that could not last above a few months, having in itself the seeds of inevitable destruction ; they had been assured, that all the powers of Europe would join us against France ; they had been told, that, if there were no other cause of ruin to our enemy, that enemy must be ruined by the loss of all his colonies (which we had taken,) and by the an- nihilation of his naval force, which seemed to have been nearly completed by the fourth year of the war ; they had had, year after year, exhibited to them such pictures of the Finances of France com- pared with those of England, as to make them be- lieve that France must speedily become bankrupt, while England was (and partly in consequence of the war) becoming, every day, more and more rich, that her commerce was daily increasing, and that her credit^ which was always firmly established, was now built upon a rock ; they had, even in the King's Speech, made at the beginning of the session of which we are now speaking, and during which the stoppage took place, at the beginning of that very session they had been told, in the King's Speech, of the SOLIDITY of the pecuniary resources of the country,! while the Minister and his adherents echoed back the assertion. Upon this last occasion, * " I feel too sensibly the repeated proofs which I have re- ceived of the affection of my subjects not to lament the ne- cessity of any additional burthens. It is, however, a great con- solation to me, to observe the favourable state of the Re- venue, and the complete success of the measure which was last year, adopted for removing the embarrassments affecting commercial credit" KING'S SPEECH, 10th Jan., 1794. t " It is a great satisfaction to me, to observe, that, not- withstanding the temporary embarrassments which have been experienced, the state of the commerce, manufactures PAPER AGAINST GOLD. 167 which, Gentlemen, is worthy of particular attention, the time being only four months before the Bank- stoppage actually took place ; upon this occasion, Sir WILLIAM LOWTHER, who seconded the address, and who is now a Lord, I believe, said, " if we re- garded our finances, they were ABUNDANT in the EXTREME, and such as were adequate to any emergency of the country." Lord MORPETH, son of the Earl of Carlisle, who moved the address to the King in answer to his speech, said, i( As to our in- ternal situation, we have witnessed it, for some time past, with joy and exultation ; and have rea- son to congratulate his Majesty, and the people at large, upon our auspicious prospects in that respect." And Mr. PITT himself said, " As to our resources^ they furnish, indeed, in a moment like the present, a subject of peculiar congratulation, and well- grounded confidence Our re- sources remain as yet, untouched, and we shall be able to bring them into action with a degree of con- cert and effect, worthy of the character of the Bri- tish nation, and of the cause in which they will be employed. These resources have in them NO- THING HOLLOW OR DELUSIVE. They are the result of an accumulated capital, of gradually increasing commerce, of HIGH AND ESTA- BLISHED CREDIT ; and they have been pro- duced while we have been contending against a country, which exhibits, in every respect, the reverse of this picture"* Such, Gentlemen, was the language of the Mi- nister and his adherents at the beginning of that session, during which took place the memorable event, recorded in the foregoing Letter ; and before you proceed any further, I beg you to look well at it. nnd revenue of the country, proves the real extent and SOLI- DITY of our resources, and furnishes you such means as must be equal to any exertions which the present crisis may require." KING'S SPEECH, 6th October, 1796. * See Parliamentary Debutes, 6lh October, 1796. 168 PAPER AGAINST GOLD. I beseech you to consider it well. If you do *>o, you never will be deluded again by any high-sound- ing assertions, let them come from what quarter they will. These, which I have just quoted, are memo- rable words. They are precious matter for history. They go a great way in enabling any one to judge of the character of Mr. PITT as a, statesman, and especially as a political economist. Gentlemen, there is no such thing as answering me here. No one can contradict me. What I have laid before you is indubitably true ; and, as such, I am sure it will have weight upon your minds, whatever your prejudices heretofore may have been. The adherents of Mr. PITT had been told all that we have now taken a hasty review of; arid, though they ought never to have believed it, having con- stantly been warned against the delusion by Mr. Fox, Mr. SHERIDAN, Mr. NICHOLLS, Mr. HOBHOUSE, Mr. GREY, Mr. TIERNEY, and others, but especially by the three former ; though they ought not to have be- lieved, and would not, had it not been for the blind- ing influence of the fears excited in their minds, have believed in those delusive assertions and predictions ; still, if they did believe in them, they were not (if they looked upon the principle of the war as being just and wise) to be blamed for supporting the Mi- nister ; but, when experience had undeceived them; when they saw jthe proof of their error ; when clearly established facts told them that they were in the wrong course ; when they had before their eyes, that which could not possibly leave a doubt in any man's mind, that the system which they had so long supported was ruinous to their country ; when they saw the Bank of England stop payment of its notes, and take shelter under an Order of the Privy Council, immediately followed by an Act of Indemnification, that is to say, an act to shelter the parties concerned from the penalties of the law : when the adherents of Mr. PITT saw this ; when they beheld these effects, this mighty ruin, which PAPER AGAINST GOLD. 169 that adherence had brought upon their country ; when they beheld this, they ought to have withdrawn, their support; and, if they had done this, though I am very far from saying, that they could have re- stored Gold and Silver payments at the Bank, and am still less inclined to say, that they would have put a stop to the workings of the French Revolution, I am decidedly of opinion, that there was yet time to give such a turn to that revolution as to render it less violent in itself, less severe towards Europe in general, and infinitely less dangerous to this country; as we, in all likelihood, never should have seen an Emperor in France, and, of course, should not have had to dread, and to guard against, the effects of his ambition and his power. It must, I think, be now clear to all the world, that to Mr. PITT, supported by the great mercantile and monied bodies, BUONAPARTE owes his rise and his greatness ; and that, instead of being, as Mr. PITT once called him, " the child and champion of Jacobinism" he may be truly called the child of Mr. PITT and the Paper System, that system, the effects of which we shall, every day, feel more and more ; that system, of the evils of' which almost every man seems now to be thoroughly convinced ; that system, of which to prevent, or, at least, retard the still greater evils, the Bullion Committee have proposed that remedy ', into which we shall, by-and-by, have to examine. Mr. PITT, who was, in the House of Commons, boldness personified ; who never seemed to feel as men in general do upon being defeated in argument, or at being detected and exposed as to points of fact ; who always appeared to increase in boldness in pro- portion as he has worsted in the contest, does, how- ever, seem to have, for a while at least, felt himself humbled upon this occasion, and to have been as the vulgar saying is. completely chop fallen ; and, after what we have seen him (in the above-quoted passa- ges) assert, only four months before, well might he feel humbled ; well might he feel afraid to open his 15 170 PAPER AGAINST GOLD. mouth in the presence of those, who had so often told him that such would be the result of his system, and whom he had, as often, reproached with the want of love for their country ; and even at whose opinions not only himself but his underlings had been accustomed to laugh. To come to the House of Commons, that scene of his long enjoyed triumph; to come to that bench, whence he had so long been in the habit of dictating to all around him, and of dealing out his sarcasms upon all who dared ques- tion his infallibility; to come to the same bench, and thence to deliver a Message from the King, (27th February, 1797,) announcing the Stoppage of Gold and Silver payments at the Bank of Eng- land ; to do this, and to look Mr. Fox in the face, seemed to be too much even for Mr. PITT ; to come down to the House, and say, that necessity had com- pelled him to issue an Order of the King's Council to forbid, or to protect the Bank of England/ro?ft paying the just demands of its creditors, was more than he was able to do without faltering, and it is, perhaps, more than any other man upon earth, under similar circumstances, would have been able to do at all. His confidence seems, for once, to have failed him; and, what is upon record as to the debate, clearly proves, that he did not know what to do ; that he literally was at his wiVs end. Having delivered the Message, and laid a copy of the Order of Coun- cil upon the table, he moved for the Message to be taken into consideration the next day ; and, at the same time, gave notice of a motion for appointing a Committee to inquire into the concerns of the Bank, an inquiry, he said, which " would greatly tend to confirm, the solidity of the Bank capital/' He also said, that he meant to declare by law, that " notes instead of cash would be taken by the public in pay* ment of the sums due to them by the Bank" Mr. ALDERMAN COMBE asked him, whether he meant " that bank notes were to be taken only by the recei- vers of the revenue, or that they were to become a PAPER AGAINST GOLD. 171 legal tender in all money transactions." He an- swered, that, " in the first instance, he meant only to propose, that they should be taken on the part of the public, leaving future measures to be decided upon, after the Committee should have made their report. Mr. COMBE asked him " whether it was his opinion, that this measure would be resorted to in the end" He answered, that " he had no opinion upon the subject. Mr. Fox asked him " if he dis- claimed the opinion." He replied, that " he said no- thing about it at all" Look at him, Gentlemen ! See there the man, who had the management of the affairs of this coun- try for twenty years, and during whose administra- tion more persons were, 1 believe, promoted to the peerage, than during any century before. Look at him. See him, who only four months before, had boasted that our " resources were untouched" and that there was nothing hollow or delusive in our finances." Look at him now, not able to say ; nay, not able to give an opinion, whether he shall pro- pose Bank-notes to be made a legal tender, or not ! Mr. NICHOLLS (of whose great understanding upon this subject we shall see many proofs by-and-by) " pressed him for an answer to the question which had been put to him, whether it was his intention that the notes of the Bank of England should be de- clared a legal tender from the Bank to the public creditor? If so, he was about to proclaim an act of insolvency. And, considering it in this light, he reprobated his silence, as an instance of most atro- cious arrogance. After animadverting, in the seve- rest terms, on the confiding majorities in that House, who supported the Minister in every measure, how- ever wild, and sanctioned every part of his conduct, however insolent, he concluded with repeating the question, whether or not bank-notes were to be de- clared a legal tender to the public creditor." After the treatment which this gentleman had frequently received at the hands of Mr. PITT and his adherents, 172 PAPER AGAINST GOLD. it could surprise no body to see him give way, upon this occasion, to a degree of asperity, which, without taking these circumstances into view, might not have been fully justified by the conduct of Mr. PITT upon this particular occasion, who, in answer to Mr. NICHOLLS, said, that he was u perplexed by the obser- vations and questions of the learned gentleman, who to an intricacy which it was impossible to unravel, added an exertion of voice much beyond what he was accustomed to, and an asperity of language which even exceeded that of the other honourable gentleman (Mr. SHERIDAN.) He hoped that he would not persist in thinking it atrocious arrogance in him, if he did not attempt to answer what he con- ceived it would be unpardonable arrogance in him to attempt to understand. When a man obtruded his opinion, with too much rashness or too much positiveness, then he might be accused of arrogance ; but he did not perceive that the man who altogether declined giving an opinion, could incur the impu- tation. But the learned gentleman seemed to be as ignorant of the forms of the House as of the common mode of business. He might have known that though it would be sometimes convenient to ask and to communicate information by question and answer, that, no discussion can regularly take place, except when a motion was before the House." This was a very poor evasion ; but, in fact, he could give no answer to the question, unless he had been ready to make a full and fair acknowledgment of his not knowing what to do. Nothing could be plainer than the question ; nothing more distinct ; nothing more intelligible to any man, who under- stood the common meaning of the frightful words, LEGAL TENDER. But, how was an answer to be given ? Even if the minister had made his mind up to go that length. Even if he had screwed his courage up to the contemplation of such a measure, how was he to find face to propose it all at once? To propose such a measure required time, even with PAPER AGAINST GOLD. 173 such a man as Mr. PITT. It, at any rate, required time for him to look round him in the House. It required time for him to discover how his adherents felt, and whether they were still to be depended upon. It also required time to break the matter to the public, and to afford an opportunity for the press, and for the minister's monied friends outof doors, to exert their influence. It not only required time to see what could be done, but what dared to be at- tempted. To obtain this time the scheme of a Committee of Inquiry was resorted to, the result of which inquiry, and an account of the measures adopted, we shall see in the next Letter. In the meanwhile, I am, Gentlemen, Your faithful friend, WM. COBBETT. State Prison, Newgate, Thursday, October 18, 1810. "But it was ureec LETTER XIIL "But it was urged that the Bank had temporary difficulties to encounter, and that it behooved them to adopt some mode of granting relief to that important public body. The House of Commons, however, knew nothing of this. No application was made to them by the Bank : nor did it appear even that application had been made for the Order in Council ; on the contrary, it appeared that this facetious Council, instead of examining the Directors of the Bank, acted entirely upon the authority of the Chan- cellor of the Exchequer. Nay, what added to his surprise was, that not one of the. Bank Directors who had seats in that House, had ever come for- ward and expressed an opinion upon the subject. Some information was certainly necessary before the House sanctioned so novel and dangerous a measure. They had heard of the Bank a short time ago lending two mil- lions to Government, and they had also heard of the dividends on Bank Stock increasing. "Was it not material to be informed therefore how they had come to stop payment at a time when their affairs seemed to be going on so prosperously?" Mr. Sheridan, Speech 28th Feb. 1807. Alleged Ability of the Bank Proceedings out of Doors for what is called Support of Public Credit Mansion House Meeting Brook Watson Quarter Sessions Resolutions Privy Council Resolutions Representations of the Venal Prints relative to these Resolutions Real Origin of the 174 PAPER AGAINST GOLD. Mansion House Meeting Directors prevail upon Mr. Pitt to have a private Meeting of Bankers at his House Plan of a public Meeting there laid Peep behind the Curtain Meeting of the Bank Proprietors Declaration of the Go- vernors, Mr. Bosanquet and Mr. Thornton These Decla- rations compared with the private Minute of the Bank, expressing their alarm for the Safety of the House, and for calling upon Mr. Pitt to know when he would interfere. GENTLEMEN, WHEN we look at the boast, referred to in the words of my motto, and consider how many boasts of the same sort the Minister had uttered, and which he had continued in the habit of uttering, down almost to the very hour of the Bank Stoppage, we cannot help wondering that he could no longer en- dure his existence. What, then, will be the asto- nishment of posterity, to hear him, in a few months after that event, speak of it and of the measures growing out of it, as the happy means of safety to the country ; and what will be their shame to find, that he was still confided in and supported ? As we proceed with the history of the measures of remedy which were now adopted, we must not fail to pay particular attention to the opinions and doc- trines^ at this time expressed and laid down by the Minister and his adherents, especially by those of his adherents, who had a more immediate interest in the concerns of the Bank of England. We must take care to bear in mind what they then said as to the origin of the Order of Council for the stoppage of Gold and Silver payments at the Bank; what they said as to the nature and necessity of the mea- sure ; what they said as to the ability of the Bank to resume its payments ; and what they said as to the time of such resumption. What they then said as to all these points, we must take care to bear in mind ; because, we shall have to compare it with what the same persons have said since, and have to show how in this case, as well as in so many others, the nation has been led on, by degrees, to acquiesce in what, if proposed to it all at once, would have PAPER AGAINST GOLD. 175 made it shrink with affright, or fired it with indig- nation. Before the House of Commons met, the day after the Message and Order of Council had been laid be- fore it, that is to say on the 28th of February, 1797, the Anti-Jackobin adherents of the Minister had been hard at work out of doors. A meeting had been called in the Mansion House of the City of London, consisting of Merchants, Bankers, and others, the Chairman being the Lord Mayor, whose name was BROOK WATSON, who then or very soon afterwards, filled the lucrative office of Commissary General to the Army, and who was, in a very few years after that, made a Baronet. The persons assem- bled upon this occasion proclaimed their resolution not to refuse bank-notes in payment of any sums due to them, and to use their utmost endeavours to make all their payments in the same manner;* which, as you will perceive, Gentlemen, was neither more nor less than resolving, that they would do their utmost to keep up their own credit and conse- quence, and, in fact, to preserve themselves from in- stant ruin. Similar Resolutions were passed in the country, where the Quarter Sessions happening to be then taking place, the Resolutions were sent forth from the Bench, with, of course, something of a magis- * MANSION HOUSE, LONDON. -February 27, 1797.- Ata meeting of Merchants, Bankers, &c., held here this day, to consider of the steps which it may be proper to take, to prevent Embarrassments to Public Credit, from the effects of any ill-founded or exaggerated Alarms, and to support it with the utmost exertions at the present important conjuncture The LORD MAYOR in the Chair ; RESOLVED UNANIMOUSLY, That we^the undersigned, being highly sensible how neces- sary the preservation of Public Credit is at this lime, do most readily hereby declare, that we will not refuse to receive Bank Notes in payment of any sum of money to be paid to us ; and we will use our utmost endeavours to make all our payments in the same manner. BROOK WATSON. The resolution was left for signatures at several public pla- ces in London. 176 PAPER AGAINST GOLD. terial weight and authority, as will be seen in the instance of the magistrates of Surrey, who, with Lords Grantley and Onslow at their head, appear to have led the way.* The Privy Council (pray read their names all over) had also a meeting upon the subject, and it was quite curious to see the Judges and great pensioners, and even the Minis- ters themselves, not excepting the Lord High Trea surer, publishing their promises to receive and to pay bank notes, and, as far as depended on them individually, to support the circulation of those notes. I These Meetings and their Resolutions furnished the venal prints with the pretence for asserting, that the alarm was at an end ; that the people had had time to reflect, and that reflection could not fail to convince them, that there was no room for suspect- ing the solidity of the Bank. The meetings and resolutions (to which latter, in London, there were * SURREY. At the General Quarter Session of the Peace of our Sovereign Lord the King, holden at Saint Mary, New- ington, by adjournment, in and for the said County, on Thursday, the 2d day of March, 1797. We, whose names are hereunto subscribed, being desirous to contribute, as far as we can, to the support of the public and commercial credit of the kingdom, at this important crisis, do hereby agree and bind ourselves to receive the Notes of the Bank of England in all payments as Money, and to support, as far as depends on us individually, their circulation for the public benefit. Here follow the names of twenty-nine signers. Ordered, That the Clerk of the Peace do cause the above to be forthwith advertised in the Morning Papers.^ the Court, LAWSON. t At the Council Chamber, Whitehall, the 28th of February, 1797, Present The Lords of His Majesty's most Honour- able Privy Council. We, whose names are hereunto sub- scribed, being desirous to contribute, as far as we can, to the 6upp9rt of the public and commercial credit of this Kingdom, at this important crisis, do hereby agree and bind ourselves to receive the Notes of the Bank of England in all payments as Money, and to support, as far as depends on us individually, their circulation. Here follow the names of forty- three privy councillors, omitted as being uninteresting to the American reader. PAPER AGAINST GOLD. 177 soon obtained thousands of signatures) were repre- sented as having been perfectly voluntary; that they were the spontaneous effects of pure public spirit, working in the breasts of loyal and disin- terested men, and, of course, that those who did not come forward to resolve, or to sign, were disloyal men. Gentlemen, stop with me here for a minute. Some of you may have been induced, by these venal writers, to think ill of all those of your neighbours, who disapproved of Mr. PITT and his deeds ; some of you may have been thus led, by the representa- tions of these writers, to hate your honest neigh- bours, to stigmatize them as Jacobins, and to suspect them, in fact, of treasonable designs ; some of you may, from this corrupt and deadly source, have had your minds so poisoned, and so perverted from their natural bias, as to have contributed towards those fatal divisions in the nation, the effect of which, it is to be feared, your childrens' children will rue. Of such of you, therefore, as answer to this description, let me beg the earnest attention, while I develop the true source of the above-mentioned meetings and resolves, which, as you have seen, were described by the venal writers, as being perfectly -voluntary, and flowing from pure public spirit. You will bear in mind, that the Order in Council was signed on Sunday, the 26th of February, and that it was laid before the House of Commons on Monday, the 27th. on which last-mentioned day, the Mansion House Meeting, Mr. BROOK WATSON in the Chair, took place. The next, Tuesday the 28th, the Minister, in opening the way for his first motion about the law to sanction the Order in Council, said, in allusion to this meeting : " With respect to the first step" to be considered, the state of the Bank, that already has, in a great measure, been ascertained by the confidence of public opinion. Of this public opinion, the most unequivocal and satisfactory proofs have been afforded^ even 'within the short 178 PAPER AGAINST GOLD. space that has elapsed since the minute of Coun- cil has been issued. It has been clearly evinced, that there is no doubt entertained with respect to the solidity of the Bank to answer all the demands of its creditors." Thus he appeared to consider the resolution of the Meeting of the Bankers and Mer- chants as expressive of the opinions and feelings of the nation at large, and, of course, as being a volun- tary act, an act of their own, an act not, by any means, dictated by him, or by the Bank, nor hatched or contrived by them. Thus the thing appeared to the world ; thus it appeared to the " most thinking people in all Europe;" this was its outside look; but, let us now take a peep behind the curtain. For a while, no official documents were laid before Parliament, relating to the Stoppage. This was avoided by one means or other. But it could not be for ever avoided ; and at last, some of the papers were laid before the House of Commons ; but by the time that these got printed, the public was lulled again, and the papers passed with little or no notice. Amongst these papers was a minute of the BANK DIRECTORS, respecting an " Interview with the Chan- cellor of the Exchequer, (Mr. Pitt,) on the 24th of February, 1797;" which you will observe, was on the Friday before, the Bank having issued Gold on Saturday for the last time. On the Thursday, the run upon the Bank had been very hard ; and the measure of Stoppage of cash payments seems to have then been looked upon as settled. With this measure in their eye, the Bank Directors and Mr. Pitt did what we shall see recorded in the following minute of the Bank Directors' proceedings, under the date just mentioned, of the 24th of February, 1797. " The Governor and Deputy Governor this day waited on Mr. Pitt, to mention to him, that it would, in the present circumstances, be highly re- quisite, that some general meeting of the bankers and chief merchants of London should be held, in order to bring on some resolution for the support of PAPER AGAINST GOLD 179 the public credit in this alarming crisis ; and they took the liberty to recommend to Mr. Pitt> to have a private meeting of some of the chief bankers at hi* house to-morrow, at three o'clock, in Avhich the plan for a more general meeting on Tuesday or Wednes- day next might be laid ; in the propriety of which Mr. Pitt agreed, and said he would summon a previous 'meeting for to-morrow accordingly. This was com- municated by the Governor to the Committee." Thus, Gentlemen, were " the most thinking peo- ple in Europe" treated. Here you see the origin ; here you see the real cause, of the public spirited meeting at the Mansion House ; here you see how those pure and disinterested persons were put in motion. You have, heretofore, seen the show ; but, you have now seen, as to this part of it, the funnels, pulleys, pegs, and wires ; and the only misfortune is, that you see them a little too late ; though, I trust that the exposition may yet do some good, and at any rate, it must, I should think, make you a little less credulous in future, a little less inclined to be- lieve every word that comes forth under appearances like those above described. While Meetings were going on in such a jovial way, in all other quarters, it would have been strange indeed if the Bank itself had not had its meeting. This took place on Thursday, 2d of March. The Order of Council had been issued on the Sunday, 26th of February ; it had been laid before the House of Commons on the 27th ; on the same day the Meeting had taken place at the Mansion-House ; on the 2Sth (as we shall presently see) the conduct of the Bank began to be discussed in Parliament, and it had been asserted there, that the Order of Coun- cil was the sole work of the Government, and not of the Bank ; the manifest intention of which was to cause it to be believed, that the government forced the Bank not to pay its creditors agreeably to its promissory notes ; and, that the Bank neither wanted nor wished any such measure on its own account. 180 PAPER AGAINST GOLD. Declarations to this amount had been made in par- liament ; but, it appears, that a repetition of them at a Bank Meeting was thought necessary ; and accord- ingly a meeting took place; or, to use their own language, " A COURT OF PROPRIETORS was held" on the day just mentioned, namely, the 2d of March. At this meeting at the Bank, where one might have expected to see the Directors and Proprietors clothed in sack-cloth and ashes, the first thing done was, the passing of a vote of THANKS to the Di- rectors for having acted agreeably to the Order of Council, that is to say, for having availed themselves of this Order to refuse payment of their promis- sory notes, to refuse payment of their just debts legally demanded. They had been guilty of a vio- lation of the law, and for that violation they were thanked by their constituents, the Stock Proprietors, who, in fact, were the Debtors of the holders of Bank notes ! Having, with an unanimous voice dispatched this part of the business of the day, the GOVERNOR of the Bank took, it appears from the re- port of the proceedings, the opportunity of publicly declaring (in a way that might get into print) that the Bank Directors had made no application to the government for an order for the stoppage of Cash- payments at the Bank. Mr. BOSANQUET, who, it seems, was a Director, declared, that the measure "was not adopted at the instance of those con- cerned in the direction of the Bank ;" and Mr. THORNTON, also a Director, said, " that he wished iv to be understood explicitly, that the Order in Coun cil was not issued at the instance of the Bank Di rectors." Mr. BOSANO.UET called the stoppage " a great state measure ;" a measure dictated by " na- tional policy." He said it was " meant to operate only for a short time;" and that " he earnestly hoped" (how different from the language of Mr. Randall Jackson and the present governor of the Bank ;) yes, he EARNESTLY HOPED, " that the Bank, which was quite able, would soon be PAPER AGAINST GOLD. 181 PERMITTED to pay its notes in cash, in the same manner that it had formerly done."* * The following is the Report, taken entire, from the Morn- ing Chronicle of the 3d of March, 1797. "Yesterday a Court of Proprietors was held at the Bank. The GOVERNOR of the Bank, after the Order in Council, 9f the 26th of February, was read, stated, that the Court of Di- rectors had thought it their duty to acquiesce in the Order, and hoped they had acted in conformity to the opinion arid wishes of the Proprietors of Bank Stock. Mr. HERMAN moved, " that it is the opinion of this Court, that the thanks of the Proprietors of Bank Stock are due to the Court of Di- rectors for their acquiescence in the Order in Council, and for their speedy communication thereof to this Court." The mo- tion was put and carried unanimously. Mr. ALLERDYCE asked, whether the application, had been made from the Bank to Government, for the Order in Council, to prohibit them from issuing specie '? The Governor of the Bank replied, that no such application had been made by the Court of Directors, but that the Bank having experienced an unexampled drain of specie for some time past, that Court had thought it their duty to acquaint the Minister of the Country with the circum- stance, that he might take what measures he might deem necessary, and at the same time remove all responsibility for such measures from the Direction. He added, that a Secret Committee of the House of Commons had been appointed to inquire into the state of the Bank accounts, and that the Court of Directors were fully persuaded that the result of that inquiry would be a report of the perfect solidity of the Corporation. Mr. SANSOM wished to be informed whether there was any precedent for the House of Commons appoint- ing a Committee to inquire into the affairs of the Bank? In his opinion, if a Committee was to be appointed, it ought to be a Committee chosen from the Proprietary; but after the assurance which they had from the Directors of the solidity of the Bank capital, he saw no necessity for any inquiry at all. A Proprietor stated, that there was a precedent for the measure on the Journals of the House of Commons, in 1696. Mr. MANNING said, he had examined into the proceedings of the House of Commons, in 1696, and found that there was not the smallest reseniblance between that and the present measure. At that time the Bank had been established for only two years, their Notes were at a discount all over the Kingdom, and the Silver-coinage was called in, circum- stances which were totally different from the present. Mr. BOSANQUET begged leave to trouble the Court with a very few words. He said that the Order in Council was to be consi- dered entirely as a great state-measure, which was not adopted at the instance of those concerned in the direction of Hit Lank. The Court of Directors, in the present state of 16 182 PAPER AGAINST GOLD. When, Gentlemen, you have read through the re- port of the Bank Proceedings of the day here referred to, and I beseech you to read every word of it, you will, doubtless, be astonished at the hardihood of men, who could, under such circumstances, hold such language. What ! thank the Directors for not paying their promissory notes ! Thank them for this ! The Proprietors of Bank Stock, who were the persons composing the Meeting upon this occa- sion, were the persons who owed the amount of the Bank notes ; they were the debtors of the note- holders ; the Directors were their agents. So that, here we see a parcel of people, who had issued great quantities of promissory notes, assemble together, and thank, aye, and publicly thank, their agents for having refused, illegally refused, payment of public affairs, had considered it to be their duty to keep the. Minister of the Country informed respecting the situation of the Bank. For sometime past there had been an unexam- pled run for specie upon the Bank, and this they communi- cated to the Chancellor of the Exchequer, leaving him to adopt what measures he might think proper. The consequence was, the Order in Council, of the 26th of February, was issued. It would have been absurd in the Directors of the Bank to have resisted this Order, because the Minister must have been supposed to be in possession of a great deal of informa- tion to which they had no access, and to be in the knowledge of circumstances of which they were not aware; besides that, there was no knowing what might have been the con- sequences had the unusual drain for cash, which they had ex- perienced, been continued for any length of time. They com- plied, therefore, with the Order of his Majesty's Council, un- derstanding it to have been dictated by national policy, and meant to operate only for a short time. He had no hesitation in saying, that the affairs of the Bank were in a state of the freafest affluence and prosperity that they had even a consi- erab\e surplus^ and that he earnestly hoped they would SOON UE PERMITTED to pay their Notes in cash in the same manner as they had formerly done. Mr. THORNTON wished it to be understood explicitly, that the Order in Council was not issued at the instance of the Bank Directors ; that their accounts were not tendered to the House of Commons for examina- tion, and that they neither asked nor wish for the partnership and guarantee of Government. There being no other busi- ness before the Court they adjourned to yesterday fortnight, when the dividends become due. PAPER AGAINST GOLD. 183 those notes! Gentlemen, our venal prints may talk as they please ; they may refer us to what in- stances they choose ; but any thing equal to this, any such instance of cool assurance, I defy them to pro- duce from the history of the world, or, even from the works of imagination. But, as yet, we have not seen these proceedings in their true colours. We have seen them in colours pretty strong ; but we have not seen them as they will appear when we have taken another look at the Bank documents, which were afterwards laid before parliament, and which, as was before observed, ne- ver got out fairly to the knowledge of the people. We have seen these Bank Directors making public declarations, that they had no hand at all in the Stoppage ; that they did not apply for the Order in Council ; that it was a measure of the government ; that it was a state measure ; and that they earnestly hoped soon to be PERMITTED to resume their payments in cash. This is what they told the pub- lic on the 2d of March. And, it was not only at the Bank-meeting that this declaration was made. It was repeatedly made in the House of Commons ; but, we will, at present, confine ourselves to what was said by the Bank Directors themselves. Such, then, were their declarations on the 2d of March. Now, then, let us see what they had been at in secret with the Minister, during the nine days before. On the 21st of February, they, observing, with great uneasiness, the large and constant de- crease in their cash, held a particular consultation on the subject, and perceiving that their cash was reduced to a certain sum, of which certain sum, be it observed, they do not slate the amount, they came to a resolution to go to Mr. Pitt, and tell him " how their cash was circumstanced," they did so, and Mr. Pitt observed to them, (and you will laugh heartily at the observation,) " that the alarm of invasion was now become much more general than he could think necessary;" they then pressed Mr. Pitt to 184 PAPER AGAINST GOLD. make some declaration in parliament, upon this sub- ject, " in order to ease the public mind." This is a pretty specimen enough of the intercourse that ex- isted between these parties, and will serve to explair the reason for many of the speeches that we have ai different times heard.* Mr. PITT, however, did, it * Resolution of the Court of Directors, and Deputation's Interview with the Chancellor of the Exchequer, 2lst Febru- ary, 1797. The Committee observing with great uneasiness, the large and constant decrease in the cash, neld a particular consulta- tion on that subject this day ; and on examination into the state of the cash since the beginning of this year, they found that in the course of the month of January, there had been a decrease of Z. and since the beginning of this month a farther loss of Z. and that the cash was now reduced to between Z. and about Z. value, in bullion and foreign coin, about the value of Z. in silver, bullion. Perceiving also, by the constant calls of the bankers from all parts of the town for cash, that there must be some extraor- dinary reasons for this drain, arising, probably, from the alarms of an expected invasion ; the Committee, after ma- turely considering the matter, resolved to send a notice to the Chancellor of the Exchequer, of the situation of matters at the Bank : and to explain exactly to him how the cash is cir- cumstanced, that he may, if possible and proper, strike out some means of alleviating the public alarms, and stopping this apparent disposition in people's minds for having a large deposit of cash in their houses. The Governor, Deputy Go- vernor, with Mr. Darell and Mr. Bosanquet, were deputed to wait upon Mr. Pitt, who went to him; and after describing to him the anxiety of mind which all the Directors were un- der on this subject, they explained to Mr. Pitt the exact par- ticulars above-mentioned. Mr. Pitt seemed aware that this tinusual drain of cash from the Bank must arise from the alarm of an invasion, which he observed was now become much more general than he could think necessary. He said, that by all his informations he could not learn of any hostile preparations of consequence making in France to invade this country, except the fleet which was refitting at Brest, after being driven off from the coast of Ireland ; but that he could not answer that no partial attack on this country would be made by such a mad and desperate enemy as we had to deal with. The deputation pressed on Mr. Pitt to declare some- thing of this kind in Parliament, in order to ease the public mind. Mr. Pitt also mentioned, that he hoped the Committee would, in the present situation of matters, think it necessary to endeavour at obtaining a supply of gold from foreign countries, which the Governor told him they were considering about, and should do what they could therein. PAPER AGAINST GOLD. 185 seems, press them, in his turn, " to endeavour to ob- tain a supply of Gold from abroad" and the Go- vernor told him they would do what they could in that way. On the 22d of February they had another inter- view with Mr. PITT, and they gave GOLDSMIDT and ELIASON orders for the purchase of gold at Ham- burgh. But we no where find any account of the success of this order, which was, besides, rendered useless by the Order of Council, which rendered Gold unnecessary* On the 24th of February they had another inter- view with Mr. PITT ; and what they say as to this interview we must pay particular attention to. At a Committee consisting of the whole Court, it ap- peared that the cash was going away faster than ever ; " which gave such an alarm, for the SA FE TY OF THE HOUSE" (mark the words) that no time was lost in sending a deputation to Mr. PITT, to ask him how far they might venture to go on pay- ing cash, and " when HE would think it necessary to INTERFERE." Mr. Prrr told them, that this was an affair of such importance, that he must be prepared with some resolution to bring forward in the Council.! * Interview with the Chancellor of the Exchequer, 22d of February, 1797. Messrs. Goldsmidt and Eliason attended the Committee this day, and were directed to give farther or- ders to Hamburgh for the purchase of gold; and were told that an application would immediately be made, to the minis- ter to order a frigate or armed sloop to go to Hamburgh to take in such gold as might be bought, and also to desire that the restriction on the captains of the packets, not to take any gold on board at Hamburgh for this country, might be taken off. The Governor and Deputy Governor waited on Mr. Pitt on this subject, who promised, to apply to the Admiralty for directions about sending out a frigate or armed sloop ; and that he would apply to me Postmaster General to give the orders to the captains of the packets. t Interview with the Chancellor of the Exchequer, 24th of February, 1797. At a Committee of the whole Court hefd this day, it appeared that the loss of cash yesterday was above /. and that about I. were already drawn out this day, which gave such an alarm for THE SAFE TY 16* 186 EAPEft AGAINST GOLD. Thus, you see, Gentlemen, the Stoppage-measure clearly originated in the representation of the Bank Directors ; and, which is very well worthy of your marked attention, Mr. BOSANQUET was one of the persons deputed to wait upon Mr. PITT on this last mentioned occasion. The shuffle of saying, that the Bank Directors were afraid that the drain might injure the " public service" is too paltry, in any view of the matter, to have any weight ; for, whose claim upon the Bank could be so good as that of the holders of the Promissory Notes? And who were " the public" but the holders of these notes? But, as if it had been resolved to leave no room even for this miserable attempt at excuse, the Minute of the Directors of the 24th of February, expressly says, that it was " alarm for the safety of the HOUSE" that sent the deputation to ask for the OF THE HOUSE, that the Deputy Governor and Mr. Bosanquet were desired to wait on Mr. Pitt to mention to him these circumstances, and to ask him how far he thought the Bank might venture to go on paying cash, and when he would think it necessary TO INTERFERE before our cash was so reduced as might be detrimental to the immediate service of the State. Mr. Pitt said this was a matter of great importance, and that he must be prepared with some resolu- tions to bring forward in the Council, for a Proclamation to stop the issue of cash from the Bank, and to give the security of Parliament to the notes of the Bank. In consequence of which he should think it might be proper to appoint a Secret Committee of the House of Commons, to look into the state of the Bank affairs; which they assured him the Bank were well prepared for, and would produce to such a Committee. Mr. Pitt also observed that he should have no objection to propose to Parliament, in case of a Proclamation, to give parliamentary security for Bank-notes. The Governor and Deputy Governor this day waited on Mr. Pitt, to mention to him, that it would in the present circumstances be highly re- quisite that some general meeting of the bankers and chief merchants of London should be held in order to bring on some resolution for the support of the public credit in this alarming crisis ; and they took the liberty to recommend to Mr. Pitt, to have a private meeting of some of the chief bankers at his house to-morrow at three o'clock, in which the plan for a more general meeting on Tuesday or Wednesday next might be laid, in the propriety of which Mr. Pitt agreed, and said he would summon a previous meeting for to-morrow accordingly This was communicated by the Governor to the Committee. PAPER AGAINST GOLD. 187 interference of Mr. PITT ; alarm for the safety of the HOUSE, and not any motive at all connected with the public service or the public good. Having now pulled aside the curtain ; having laid the whole thing bare to your view ; having placed the application to Parliament in its true light; I shall in my next, lay before you an account of the measures, which the Parliament adopted, and which have, under one pretence or another, been continued in force to this day. In the meanwhile, I remain, Gentlemen, Your faithful Friend, WM. COBBETT. State Prison, Newgate, Thursday, 25th Oct. 1810. LETTER XIV. " The question for the people to ask, and the only question, is this : whe- ther the quantity of Bank Notes, payable on demand, which the Bank has issued, be greater than the Bank can pay oft" in Gold and Silver." Pa ine. The measures adopted by Parliament, in consequence of the Bank Stoppage Names of the Bank Directors in 1797 King's Message Mr. Pitt's Motion for a Secret Commit- teeMr. Fox and other Members wished- for an Inquiry in- to the Cause of the Stoppage Mr. Pitt's motion carried by a great Majorky List of the Minority Necessity of a Parliamentary Reform Manner of appointing the Se- cret Committee Names of the Committee Restricted Powers of the Committee-Reports from the Committee Not a word said about the Quantity of Gold and Silver in the Bank Mr. Paine' s Assertion about the Inability of the Bank to pay in Gold and Silver No attempt made to dis- prove this Assertion Mr. Pitt's, Sir John Mitford's, and L9rd Hawkesbury's Assertions Mr. Grey not satisfied with the Evidence produced before the Committee Mr. Sheridan's Answer to Lord Hawkesbury. GENTLEMEN, I HAVE now to beg your attention to a very impor- tant part of our subject ; namely, the measures, which, by way of remedy, were adopted by the Par- liament, in consequence of the run upon the Bank and the stoppage of Gold and Silver payments there. 183 PAPER AGAINST GOLD. The Letter immediately preceding this, put you in possession of a thorough knowledge of the way in which the Bank Directors and the Minister had gone to work in order to prepare the way for the Parliamentary Measures which were to follow. You were there placed behind the curtain ; you saw all the actors in their natural persons ;* all the paints, patches, cloaks and visors ; all the trap-doors, pulleys, pegs and wires. You not only saw the Resolving arid Subscribing show acted, but you saw it got up ; you saw the Showman and all his people busy in making their preparations; and, after that, you were let in to the rehearsal. In Letter XII, at page 170, you have seen how the matter was first brought before the Parliament, on Monday, the 27th of February, 1797, in the form of a Message from the King;t and, you have seen, * Truth and Justice demand that as far as possible, the NAMES of all the persons who took an active part, upon this memorable occasion, should be recorded. Parliament may yet revise the measures of that day ; and, then, the names of all the parties, immediately concerned, ought to be known, and must be known. From this opinion it is, that I insert here the names of the persons who were the DIRECTORS of the Bank of England at the time when the stoppage took place, and amongst them we find our friend BROOK WATSON, who was, as we have seen, in the Chair at the Mansion- House Meeting. Thomas Raikes, Governor. Samuel Thornton. Deputy Governor. T. Boddington. Jeremiah Harman. George Peters. S. Bosanquet. Thomas Lewis. Charles Pole. Alex. Champion Beeston Long. John Puget. Edward Darrell. William Manning. James Reed. Thomas Dea. Job Mathew. P. I. Thellusson. George Dorrien. Sir R. Neave. Godfrey Thornton. N. Bogle French. Joseph Nutt. Brook Watson. Daniel Giles. John Pearse. John Whitmore. t GEORGE R. His Majesty thinks it proper to communicate to the House of Commons, without delay, the measure adopted to obviate the effects which misht be occasioned by the unusual demand of specie lately made from different parts of the country and the metropolis. The peculiar nature and exigency of the case appeared to require, in the first instance, the measure con- PAPER AGAINST GOLD. 189 that the Minister, the hitherto bragging Minister, being upon that occasion pressed by Mr. COMBE and others for an answer to the question as to what he meant to do, had no answer to give. On the 27th, PITT gave notice of a motion, to be made next day, for the appointment of a Committee to inquire into the ability of the Bank to pay the demands upon it ; and also to inquire and make re- port as to the necessity of continuing of the measure adopted by the Council, that is to say, continuing" the refusal of money payments at the Bank* We shall have to speak more fully about this Committee by-and-by ; but we must stop here a mo- ment, and take a brief sketch of the debate that ensued upon PITT'S motion. Mr. Fox and those who were with him said, that they had no objection to the appointment of a Committee, provided it was ap- pointed fairly ; but they insisted, that it would dis- cover a shameful disregard of their duty, if the House moved an inch further without inquiring into the causes which produced that alleged necessity, upon which the Order of Council, sanctioning a vio- lation of the law, was founded. They said, here is the minister calling upon you still to confide in him ; in him, under whom the Bank has been compelled to stop paying its notes. Ought you not to inquire, tained in the Order of Council which his Majesty has directed to be laid before the House. In recommending this impor- tant subject to the immediate and serious attention of the House of Commons, his Majesty relies with the utmost con- fidence on the experienced wisdom and firmness of his Par- liament for taking such measures as may he best calculated to meet any temporary pressure, and to call forth, in the most effectual manner, the extensive resources of his kingdoms in support of their public and commercial credit, and in defence of their dearest interests. G. R. * "That a SECRET COMMITTEE be appointed to ascer- tain the total amount of the out-standing demands on the Bank of England, and likewise of the funds for discharging the same ; and that they do also report their opinion of the necessity of providing for the confirmation and continuance of the measures, taken in pursuance of the minute of Council of the 26th instant." 190 PAPER AGAINST GOLD. first of all, into his measures ? Ought you not to inquire into the causes, of the fatal and disgraceful necessity of this stoppage ? Here is a minister, who has had a majority of your votes for years ; he has had your unlimited and blind confidence ; he had the absolute command of all the resources of the nation ; he has done what he pleased for years past ; he has within these very few weeks, told you himself, and advised the King to tell you, in the most solemn manner, that your pecuniary affairs were in the most flourishing state, and rested upon the most solid foundation ; and this same man now comes and tells you, that necessity, that urgency, that something had compelled him to issue an Order to sanction the stoppage of cash payments at the Bank, and to oblige the public creditor, contrary to law, to receive his dividends in paper, instead of the Gold and Sil- ver coin which the law gave him a right to demand. This, said Mr. Fox and his friends, is what this Minister now tells you ; and v will you not, before you proceed to inquire into the propriety of continu- ing the stoppage, inquire into the cause of\ the im- perious necessity which is said to have produced it? Will you attempt an expedient, will you attempt a remedy, without inquiring into the cause of the evil? Will you do that, which, even now, after all that you have seen and felt, shall prove to the world that your confidence is as blind as ever ? " Have any three months, in the course of this war," said Mr. Fox, " passed without the minister's producing some new expedient? and have not all his expedients proved erroneous ? Year after year he has been amusing us with predictions with respect to France, which was now on the verge and now in the gulf of bankruptcy ; the assignats and the mandate could not possibly continue, he said ; which was very true, but while he was thus amusing us, he led us to the very same verge, aye, into the very same gulf." Mr. HOBHOUSE said, "that the assurances of the minister would never beat down this plain dictate of PAPER AGAINST GOLD. 191 common sense, that by his conduct the Bank had been obliged to commit an act of insolvency, by re- fusing specie for its paper, and, therefore he wished for a full inquiry into his conduct." Mr. SHERIDAN, in a most admirable speech, laid the whole matter open, completely exposed the motive of the proposed Committee, and moved to Mr. PITT'S motion an amendment, in the following words, " That the Committee should inquire into the causes which pro- duced the Order in Council." In spite, however, of these speeches ; in spite of all the arguments made use of on this side, and none of which met with even an attempt at an answer from any one but Mr. PITT himself : in spite of all this, the House decided, by a majority of 244 to 88, against Mr. SHERIDAN'S amendment, that is to say, against inquiring into the cause of the alleged neces- sity which induced the Privy Council to issue an order, sanctioning a refusal, on the part of the Bank, to pay their promissory notes in Gold and Silver. The men, who voted upon this occasion, should be known. We have only the names of the Minority recorded. Those you will keep in mind, Gentlemen, and, before we have finished the subject, we shall come at the names of the Majority ; or, at least, we can iret the names of all the members besides the minority. Mr. Fox renewed the subject, on the 1st of March, by a motion for the appointment of a sepa- rate Committee " to inquire into the causes, which produced the Order in Council of the 26th of Febru- ary," for the stoppage of cash payments at the Bank ; and he was left in a similar Minority. Here it is, Gentlemen, that you see the real cause of all the calamities that have fallen upon our coun- try, and of all the dangers that now threaten it, and these afe dangers that will not be frowned out of countenance, that will not be made to hide their head, at the sound of the voice of men in power ; dangers that are not to be talked or voted away. You have seen these dangers creep on upon us by slow de- 192 PAPER AGAINST GOLD. grees, but you have seen their pace to be steady. They have never stopped. They keep gathering about us ; and he is a very foolish man, who expects any remedy, till the great cause of the evil be re- moved; that is to say, until there shall take place a radical Reform of the Commons' House of Parlia- ment, agreeably to the principles of the English Constitution, which reform, to use the words of the Kent Petition, is now more than ever necessary to the safety of both the people and the throne. The motions for a full inquiry being rejected, the , minister proceeded in his work of getting a SE- CRET COMMITTEE, who were to inquire into the affairs of the Bank, and to report their opinion relative to the necessity of continuing, by Act of Parliament, the refusal of coin at the Bank. And now, Gentlemen, I beg you to observe well the man- ner of appointing this Committee. It was to con- sist of fifteen members ; every member of the House, who was present, might put fifteen names into a box ; and, when all the names were taken out, the fifteen persons whose names appeared oftenest upon the tickets put in, were the Committee. Of course that side which had a majority of tickets to put in would choose the members of the Committee. The custom, indeed, is, upon such occasions, to make out a List, and send it round amongst the members, and of course, all those who are on the side of the minister, will take the Ministerial List ; so that, in fact, whoever has a majority in the House, chooses the Committee. Upon the particular occasion before us, Mr. SHERIDAN, before the Report of who were the Committee was made to the House, read the names of them out loud in the House ; and, when the report came to be made, it appeared that his List was perfectly correct* Indeed, he had got hold of * List of the Secret Committee. William Hassey ; Wil- liam Plumer ; Thomas Powys ; Thomas Grenville; William Wilberforce ; John Blackburne ; Thomas Berney Bramp- ston ; Charles Bragge ; Sir John Mitford, (Solicitor General ;) PAPER AGAINST GOLD. 193 one of the Ministerial Lists, and, of course, he could not be in error in this respect. But even a Committee, thus formed ; a Secret Committee chosen by the Ministers own party ; even this Committee were, Mr. PITT said, (See De- bates, 28th February,) " by no means called upon to push their inquiries into circumstances, the dis- closure of which would be attended with temporary injury to the credit of the country, and with per- manent embarrassment to the operations of the Bank." Mr. PITT said, that his principal object in appointing such a Committee was to have it ascer- tained, that the affairs of the Bank were in a pros- perous state ; that the Bank had abundant means to answer all the demands upon it ; and that, there- fore, the holders of bank notes ought to look upon them as being equally good with Gold and Silver. Now, the way, and the only way, to produce this so-much- wished-for conviction was, one would have thought, to let the .Committee ascertain that the quantity oj Gold and Silver in the Bank was sufficient for pay- ing off the notes ; or, at any rate, was in a due pro- portion to the notes. But, so far from this being done, the Committee did not make any inquiries at all, relative to the quantity of Gold^and Silver in the Bank. They merely inquired into the state of the books at the Bank, setting their bank notes on one side, and their Stock on the other side. The Bank said : We .owe the holders the amount of our notes, but the Government owes us still more ; and not a word was said about Gold and Silver, though one would have thought, that this was the great, and in- deed, the only thing to make inquiry about ; espe- cially as Mr. PAINE, in his pamphlet, published the year before, had made statements, whence he had William Wilberforce Bird ; John Pane ; Isaac Hawkins Browne; Sir John Scott, (Attorney General;) John William Anderson. The three, first had voted with Mr. Pox for a full inquiry but all the rest belonged to the party of Mr. Pitt. 17 194 PAPER AGAINST GOLD. drawn a conclusion, that the hank, if put to the test, " had not money to pay half a crown in the pound." This was a charge, which, one would have thought, it would he the grand object of the Minister and the Bank to do away. But, no such thing was even at- tempted, and the two Reports of the Committee,* * FIRST REPORT, March 3, 1797. The Committee appointed to examine and state the total amount of out-standing de- mands on the Bank of England, and likewise of the Funds for discharging the same ; and to report the result thereof to the House, together with their opinion on the necessity of providing for the confirmation and continuance, for a time to be limited, of measures taken in pursuance of the minute of Council on the 26th of February last ; and who are empowered to report their proceedings from time to time to the House ; have, pursuant to the order of the House, proceeded to examine into the several matters referred to their consideration, and have unanimously agreed upon the following Report, viz. Your Committee nave examined the total amount of out-standing demands on the Bank of England, and likewise of the Funds for discharging the same ; and think it their duty, without loss of time, to state those total amounts, and to report the result thereof to the House. Your Committee find, upon such examination, that the total amount of out-standing demands on the Bank, on the 25th of February last, (to which day the accounts could be completely made up) was 13,770,390Z. ; and that the total amount of the Funds for discharging those demands (not including the permanent debt due from Go- vernment of 11,686,800^., which bears an interest of three per cent.) was on the same 25th day of February last 17,597,2?OZ. ; and that the result is, that there was, on the 25th day of Feb- ruary last, a surplus of effects belonging to the Bank, beyond the amount of their debts, amounting to the sum of 3,826, 890Z. exclusiveof the above-mentioned permanent debt of 11,686,SOO/. due from Government. And your Committee further repre- sent, that since the 25th of February last considerable issues have been made by the Bank in bank notes, both upon Gov- ernment securities and in discounting bills, the particulars of which could not immediately be made up; but as those issues appear to your Committee to have been made upon corresponding securities, taken with the usual care and at- tention, the actual balance in favour of the Bank did not appear to your Committee to have been thereby diminished. SECOND REPORT, Tuesday, 7th March. Mr. Brampston brought up the following Report : The Committee appointed to examine and state the total amount of out-standing demands on the Bank of England, and likewise of the Funds for discharging the same ; and to report the result thereof to the House, together with their PAPER AGAINST GOLD. 195 did accordingly not at all tend to the restoration of that sort of confidence, which would have enabled the Bank to open its doors to the applicants for Guineas. It was in vain that Mr. PITT told the House, that the reports of the Secret Committee were highly consoling ; that the affairs of the Bank were in a most prosperous state ; that persons most con- versant (alluding to the Mansion House Resolvers) believed in the solidity of its means ; that the public had nothing to do with the internal economy of the Bank; that it was sufficient for the public to know, that the corporation was a rich corporation ; that the solidity of the Bank was asserted in the report of the Secret Committee then on the table ; that that report left no doubt upon the subject ; that it was an impor- tant consolation, that there were funds amply suffi- cient for the ultimate security of those who could not have their demands satisfied for a time ; and that as to what was due from the Government to the Bank, it rested upon the best possible security, because it rested upon the aggregate powers of the country. (See Debates, 9th March, 1797.) In vain did Lord Hawkesbury, in answer to Mr. Fox, deny that the term Bankruptcy applied to the situation of the Bank or the Government. He said, what was very true, that the embarrassments of the Bank were im- puted to the scarcity or want of specie. But, in vain did he question the truth of this proposition ; in vain did he say that a scarcity of guineas might rise opinion on the necessity of providing for the confirmation and continuance, for a time to be limited, of measures taken in pursuance of the Minute of Council on the 26th of February last ; and who were empowered to report their proceedings from time to time to the House ; have further examined into the several matters referred to their consideration ; and have agreed to^report to the House ; That, in their opinion, it is necessary to provide for the confirmation and continuance, for a time to be limited, of the measures taken in pursuance of the Order of Council on the 2Gth of February last ; submit- ting to the wisdom of Parliament to determine for what li- mited time it may be necessary that those measures should be continued. 196 PAPER AGAINST GOLD. from an increase of trade, and not from the excess of paper, (Debate 9th March, 1797 ;) in vain did Sir John Mitford, then Solicitor General (same De- bate) say that no man, however rich, would be able to stand a run ; that it was unfair to call the stop- page a Bankruptcy ; that the Bank was solvent, al- though at this time unable to pay in cash ; that the refusal to pay in cash could not be called a fraud, because the public knew that such an event might happen ; that the stoppage at the Bank was like that which might be enforced by the door keepers of a theatre, upon a false alarm of fire, in order to pre- vent the people from rushing out all at once, to their destruction or injury ; that if nothing had been done to put a stop to the run upon the Bank, the Bank must have been totally ruined ; that there were other public creditors besides the Stock-holders, the army and the navy ; that they were as much public cre- ditors as the holders of bank notes could be, and that they required payment in cash more so than any other description of men in this country. In vain was all this said. Mr. GREY, (now Earl Grey,) said that the evidence brought before the Committee had not satisfied him ; and the satisfac- tion to the public was evidently not greater ; for, if it had been satisfactory, or if the report of the Secret Committee had been satisfactory, there could have been no occasion whatever for continuing the power of the Bank to refuse payment in specie. This was told them by Mr. Fox and Mr. SHERIDAN, who asked : if the Bank be in so prosperous a situation as you say it is, why do you wish to pass a law to protect them against the demands of the holders of their notes ? If the Bank be so rich as you say it is, what need has it of your assistance ? You tell us, said Mr. SHERIDAN (alluding to the speech of Lord Hawkesbury) that paper " is not only a cleaner, neater, and more portable medium to represent pro- perty ; but that it is the very essen-ce of wealth it- self, and that the flourishing state of our commerce PAPER AGAINST GOLD. 197 is the cause of this inability to produce specie to answer demands upon the Bank of England. 1 ' See Debate of 9th March, where these observations are fol- lowed up by an inimitable instance of what is called by logicians the reductio ad absurdum. You tell us, said he, that the public are of your opinion, and that they reject our opinion; you tell us that the public are satisfied with the report of the Committee ; you tell us that the public like bank notes as well as guineas. But, with these assertions upon your lips, you pass a law to protect the Bank against the de- mands of that public ; you pass a law to compel that public to receive paper at the Bank, instead of that gold, which you say they like no better than that paper. The truth is, Gentlemen, the public, generally speaking, knew nothing at all about the transactions between the Government and the Bank; they knew nothing at all about the trade or the property of the Bank ; they knew that they held promissory notes issued by the Bank, payable to the bearer on demand, and they looked upon these notes as being equally valuable with gold, because, until now, they could, at any time, carry them to the Bank, and receive gold in exchange for them. Nothing, therefore, could have the smallest tendency to convince them of the solidity of the Bank, unless it, at the same time, tended to convince them, that there was gold in the Bank, sufficient to answer the demands of those who presented notes for payment, or who chose to de- mand gold in payment of their dividends, or interest upon their Stock. And not a particle of conviction, in this way, were the reports of the Secret Com- mittee calculated to produce. Mr. SHERIDAN (see Debate 28th February, 1797) said that he was " convinced that if the Bank was not able to resume its payments immediately, he foresaw it never would be able afterwards to de- fray its out-standing engagements in cash." And the reason he gave was that the suspension of cash pay- 17* 198 PAPER AGAINST GOLD. merits would produce the issue of a greater quantity of paper. This reason was so manifest, that it was impossible that the truth of it should not be felt, though owing to the prejudices of the times, there were few persons amongst the Merchants and Bank- ers, by whom it would be acknowledged. The same Was said by Mr. NICHOLLS and Mr. HOBHOUSE, in whose speeches, together with those of Mr. Fox and Mr. SHERIDAN, will be found predictions of all the consequences which have already flowed, and which are likely to flow, from the stoppage of gold and sil- ver payments at the Bank. We have now seen enough of the measures which were, adopted as forerunners of the Acts of Parlia- ment relating to the Bank Stoppage ; and, in my next Letter, I shall, I flatter myself, be able to present you with a complete, though a very concise, view of those Acts, with which every man in this country ought to be thoroughly acquainted. In the mean while, I remain, Gentlemen, Your faithful friend, WM. COBBETT. State Prison, Newgate, Thursday ', November 1st, 181CL LETTER XV. 41 When the situation of the Bank of England was under the consideration of the two Houses of Parliament, in the year 1797. it was my opinion, and that of many others, that the extent to lohich Paper currency had been carried, was the first and principal, though not the sole cause of the many difficulties, to which that corporate body was then, and had of late years, from time to lime been exposed, in supplying the Cash occasionally neces- sary for the commerce of the Kingdom ; for the Bank of England being at the head of all circulation, and the great repository of unemployed cash, it necessarily happens, that whenever a sudden increased supply of Coin becomes indispensable, in consequence of private failures or general dis- credit, by which Notes of the before-mentioned description are driven out of circulation, the Bank of England can alone furnish the coins which are required to -make up this deficiency, and this corporate body is there- by rendered responsible, not only for the value of its own noAvwhieh it may have issued, but, in a certain decree, for such HS may be issued by every private Banker in the Kingdom, Jet the substance, credit, or dis- cretion of such a Banker be what it may." Late Earl of Liverpool. Letter to the King. Published in 1805. PAPER AGAINST GOLD. 199 " The quantity of Cash in the Bank can never, on the evidence of these cir- cumstances, be so much as two millions ; most probably not more than one million ; and on this slender twig hangs the whole funding system of four hundred millions, besides many millions of bank notes. The sum in the Bank, if Mr. Chalmers be correct, is nut sufficient to pay one fourth of only one year's interest of the national debt, were the creditors to de- mand payment in Cash, or to demand Cash for the Bank Notes in which the interest is paid. A circumstance always liable to happen." Pain*. Decline and Fall of the English System of Finance. Published in 1795. A more minute View of the Affairs of the Bank necessary State of the Case between the Bank and the People The Property of the Bank The Statement of Debts and Cre- dits in the Report of the Secret Committee The Bank ren- ders its own Account The more detailed Statement pub- lished by Mr. Allerdyce The Property of the Bank is in Paper and not in Specie Amount of the Bank notes com- pared with the Cash The great Question was, what Cash and Bullion there was in the Bank Mr. Paine's Opinion founded upon the Estimate of Mr. Eden and Mr. Chalmers Error in supposing that the Minister took Specie out of the Bank to send it abroad Mr. Pitt's answer to Mr. Hob- house and Mr. Hussey Mr*. Pitt's Argument verifying the Opinion of Mr. Paine The whole become a System of Paper. GENTLEMEN, IN the foregoing Letter, (at pages 194 and 195,) we have seen the Reports of the Secret Committee of the House of Commons, relative, FIRST, to the state of the Bank's Affairs ; and, SECOND, relative to the continuance of refusal of Cash payments at the Bank. We shall next take a view of the ACTS, passed by the Parliament, upon this memorable oc- casion ; not, however, till we have looked a little more minutely into the state of the Bank's Affairs. It was before observed, that the Committee, that even a Secret Committee, and that Committee, ap- pointed, too, in the manner that we have seen (at page 192 ;) that even a Committee like this were not permitted (to use the phrase of Pitt) to " push their inquiries into circumstances, the disclosure of which would he attended with injury to public credit." Accordingly, not a word do this Committee say about the quantity of Gold and Silver in theBank, though the great, and, indeed, the only cause of the Stop- page, and of the whole of these proceedings, was, 200 PAPER AGAINST GOLD. the alarm felt by the Directors at the daily decrease in their Gold and Silver. The question, and the only question of any importance to the people, that is to say, to the holders of the bank notes, was : " Is there a quantity of real money in the Bank sufficient to pay us the amount of our notes, when we may choose to present them for payment ?" This was the question, to which the people wanted an answer; but with nothing relating to this question, were the Committee to meddle. This question was, with as- surance unparalleled, said to belong wholly to the "private economy of the Bank, with which the pub- lie had nothing at all to do." Surely nothing ever was heard so impudent as this. The holders of the bank notes, the creditors of the Bank Company, the creditors of this company of Merchants, carry their notes and demand payment; the Company of Merchants apply to the Minister, and he obtains from the Privy Council an Order to authorise the Company to refuse to pay the just and lawful demands of their creditors, and then the Minister, when he comes to the Parliament for an Act to sanction and to continue this refusal, tells the House of Commons, that even a Secret Committee of them, though chosen as we have seen, are not to push their inquiries into circumstances, the dis- closure of which might injure the credit of the Bank; and yet he has the face to say, at the same time, that the report of this Committee cannot fail to satisfy the country of the ability of the Bank to pay all its out standing demands. Gentlemen, we will now look a little more minutely into that report. It states, that the Government owes the Bank Company 11,686,800, which bears an interest of three per cent ; that is to say, that the Bank Company, like our neighbour GRIZZLE GREENHORN, is a Stock-holder and has its name writ- ten in the GREAT BOOK ; which Great Book, you will bear in mind, is kept at the Bank itself, and the interest upon the said stock is paid by the Bank Com- PAPER AGAINST GOLD. 201 pany to the Bank Company, and in bank notes made at the order of the Bank Company ! This was all very fine, to be sure ; but, it certainly did not go one inch towards convincing the holder of a bank note, that the Bank was able to pay him in Gold or Silver. The Committee next state the means and the Debts of the Bank, as follows : Total amount of the Funds of the Bank (exclusive of debt due to it from the Government of 11,686,800) on the 25th of Feb., 1797 17,597,280 Total amount of outstanding demands upon the Bank on the 25th of Feb- ruary, 1797 13.770,390 Surplus in favour of the Bank . . . 3,826,890 This was all very fine again ; but what was it to the public ? What was it to the holders of the bank notes, who wanted Gold for them ? Besides, whence came the evidence of the truth of this ? The proofs of a trader's solvency are not, I believe, generally left to himself. The Bank Company had stopped payment, and, when an inquiry was taking place into the state of its affairs and especially with regard to its ability to pay, how comes it that the inquirers were content with its own statement and its own story ? This is not the way that inquiries are made into the affairs of other traders, when they stop payment. Mr. GREY, as we have seen before, (See Debate of 9th of March, 1797,) said that, though one of the Secret Committee, the evidence had not satisfied him ; and, indeed, what was this report more or less than the Bank's presentation of the state of its own affairs-. But supposing the statement to be correct, still what was there to satisfy the people of the country ; what to satisfy the holders of the notes, that the Bank was able to pay those notes, that is to say, to give gold and silver for them. For as to payment 202 PAPER AGAINST GOLD. in any other way, it is nonsense to talk of it. What was there, in this Report, then, to cause it to be be- lieved, that the Bank was able to pay its notes ? Here is very big talk ; high-sounding words, and more high-sounding figures ; but if we put them to the scrutiny, we find nothing at all in them : we find not the smallest circumstance to induce any holder of a bank note to suppose, that the Bank is, or ever will be, able to pay that note off, agreeably to the promise, expressed upon the face of it. The statement, however, from which, it appears, the Secret Committee made up their Report, was more in detail. This statement was afterwards given to the public by Mr. ALLERDYCE, a member of the then Parliament, and a person who constantly voted with the Minister. The statement thus given was as follows : STATE OF THE FINANCES OF THE BANK OP ENGLAND, FEB. 25, 1797. Particulars of Debt A Drawing Account . Exchequer Bills . . Unpn id Dividends . . Unpaid dividends, i Bank Stock . . . Do. in India annuities Sundries unclaimed Due from Cash on th loan of 1797 . . Unpaid Irish Dividend Do. on Imperial Loan Bank notes in circulation ccount. /.2,3S9,600 1,676,000 983,730 45,150 10,210 1,330 17,060 1,460 5,600 5,130,140 8,640,250 13,770,390 3,825,830 17,597,280 Particulars of Credit Bills and Notes dis- counted. Cash and Bullion Exchequer Bills . . . Lands and Tenements . Money lent to India Com- pany ..... Stamps Navy and Victualling Bills Account. 4,176,080 8,228,000 65,000 700,000 1,510 15,890 54,150 5,320 24,150 795,800 1,000,000 1,512,270 376,000 88,120 740 554,250 17,597,230 American Debentures . Petty Cash in House . Sundry articles . . . 5 per Cent annuities 5 per Cents 1797 . . . Treasury bills paid for the Government . . Loan to Government . Bills discounted unpaid Treasury and Exchequer fees Interest due on different Loans advanced to Government .... * To convert these sums into United States Money, see page 44. PAPER AGAINST GOLD. 03 Now what is all this ? Why, it is, with the ex- ception of three of the items, a mere account of paper between the Government and the Bank, and in which the people, who held the bank notes, could have no interest whatever. The Bank held Ex- chequer Bills, and Navy and Victualling Bills, and had lent money (that is to say bank notes) to the East India Company, and had five per cent, stock, and Treasury Bills, and had interest due upon loans; all which might be very well for the Bank, but what was it to a man, who held a bank note and who could not get payment for it when he presented it to the Bank? These fine articles of credit were very good for the Bank Company ; but what good were they to 'SQUIRE GULL, who, being alarmed at the pros- pect of a Jacobin invasion, wished, in spite of his loyalty, to turn his bank notes into guineas ? What use were they to our neighbour GRIZZLE GREENHORN, who now wished, of course, to put by a few guineas, and who, of course, wished to receive her dividends in gold, to prevent her from doing which by law, this very report was a preliminary step? What consolation was Grizzle to draw from this account of debts due from the Government to the Bank, es- pecially when it was clear, that, if the Government ever paid the Bank, it must pay it in bank notes, seeing that in bank notes the taxes were now paid ? The three items to which the people would look, were those expressing, on one side, the amount of the bank notes in circulation ; and, on the other, the amount of the cash, or coin and bullion in the Bank Compamfs House, commonly called the Bank. Ac- cordingly to the above statement these were on the 25th of February, 1797, as follow*; : Amount of Bank Notes in circulation .... 8,640,250 Bills and Notes discounted, Cash and Bullion . 4,176 080 Petty Cash in the House 5,3-20 4,181,400 Difference 4,453,850 204 PAPER AGAINST GOLD. But, who is to say how much the Bills and Notes discounted amounted to? Who is to answer, that they did not make one half; who is to say, that they did not make nine tenths of the sum of 4,176,080 ? Why was the amount of the cash and bullion hud- dled up in one sum along with the amount of Bills and Notes discounted ! Why were things so differ- ent in their nature confounded together ? If GRIZ- ZLE GREENHORN wanted her bank notes paid at the Bank, she would not take discounted bills in pay- ment. What the nation wanted to see, was, how much the Bank had of that sort of thing^ in which bank notes could be paid ; how much it had of that sort of thing, the value of which no invasion or re- volution would destroy : how much it had of that sort of thing, in which it had promised to pay upon demand the bearers of its notes ; how much, in short, it had of MONEY, and not of bills and notes discounted, with which the people had nothing at all to do, there being no man of common sense, who could care a straw about how much of its paper the Bank gave to others for their paper, so that he got guineas for his bank notes ; and, if he could not get this, what consolation was it to him to know, that the Bank had lent but little of its paper to the mer- chants ? As to the exact quantity of cash and bullion in the Bank, when the stoppage took place, Mr. ALLER- DYCE gives a table, showing the amount at stated pe- riods, for several years, according to which Table, the total amount of the cash and bullion in the Bank, at the time of the Stoppage, was 1,272,000/. Aye, ONE MILLION, TWO HUNDRED AND SE- VENTY-TWO THOUSAND POUNDS. He comes at this sum thus. The Bank of England have Numbers^ to denote their quantity of cash and bul- lion. When they submitted their accounts to Par- liament, in 1797, it was thought necessary to keep the amount of the cash and bullion a secret from Par- liament and the public. They, therefore, only gave PAPER AGAINST GOLD. 205 the Numbers for distinct periods in several years, in order to show the proportionate increase or dimi- nution of the cash and bullion. From these Num- bers, however, a discovery was, it is said, made, and the sum above-named, ascertained to be the amount of the cash and bullion in the Bank at the time of the Stoppage. But upon this, I wish to place no re- liance ; nor do I care, whether the statement above given, of cash and bullion, and discounted bills be correct, or not. These are things of inferior conse- quence compared with the great and well-known facts ; namely, that no proof was produced, or at- tempted to be produced, that ihe Bank Company had gold or silver, or both together, sufficient to pay its promissory notes ; and that no account was rendered to the Parliament of the amount of the cash and bul- lion in the Bank. Mr. PAINE had, only the year before, said, in the words of my motto, that the quantity of cash in the Bank could never, on the evidence of circumstances, be so much as two millions, and most probably, not more than one million ; that, on this slender twig, al- ways liable to be broken, hung the whole funding sys- tem of four hundred millions, besides many millions in bank notes ; that the sum in the Bank was not sufficient to pay one fourth of only one year's interest of the Na- tional Debt, were the creditors to demand payment in cash, or to demand cash for the bank notes in which the interest is paid: a circumstance always liable to hap- pen. Mr. PAINE founded this opinion upon a state- ment of Mr. EDEN (now Lord AUCKLAND) and Mr. CHALMERS, Clerk to the Board of Trade, who had given an account, or rather, an estimate, of the gold coin circulating in the kingdom ; and, it is truly sur- prising to observe how near Mr. PAINE was to the exact truth as to this point, though at the time when his pamphlet was published, its calculations and pre- dictions were treated with scorn, and the work itself was ascribed to a malicious desire to cause the ruin of England ; just as if it were in the power of PAINE, 18 206 PAPER AGAINST GOLD. or of any one else, to injure the credit of a nation; or, as if any thing but the want, the real want of the gold and bullion could shake the faith of the public in such an establishment as that o'f the Bank. PAINE might have written 'till this time without persuading any one that a guinea was a thing not to be relied upon. He never would haye written people out ol their belief in the goodness of guineas. And, it the Bank had stood a run for only one week, he might have written his pen to the stump, but would not have shaken the people's confidence. Credit that has a solid foundation need fear no assaults. At the time when this subject was under discus- sion in the House of Commons, the Minister was charged, by the Opposition, with having taken the money from the Bank and sent it abroad in sub- sidies. This was certainly a very great error, or, it was made use of for the purpose of annoying the Minister at the expense of truth. I am, however, disposed to attribute it to error ; for, it was urged in such a manner, and by such persons, as to obviate all suspicion of its being a mere party weapon. Mr. HOBHOUSE (Debate 2Sth February, 1797,) said, that he suspected that the money had been buried in Germany, and not by the people of England, in dread of invasion. And Mr. HUSSEY, said, that the Minister " had laid his rapacious hands upon the su.ns destined for the payment of the public cre- ditor. He knew that the public creditors had been refused their just demands. He had witnessed the truth of this woeful circumstance himself. He had been told by a person who had applied for payment, that, in payment of a sum of twenty- three pounds, three pounds in cash had been offered, and the rest only in notes. Such a melancholy day as this for England he had hoped never to live to see. Let the Chancellor of the Exchequer pay the ten millions Government owed the Bank, and then it would be able to fulfil all its engagements. It was not that the Bank was unable to satisfy its creditors, but it PAPER AGAINST GOLD. 207 was the continued demand of money to feed the ex- penses of this ruinous and disastrous war, which rendered it unjust to those who depended upon its credit." Mr. PITT, who seemed to have avoided this point with all his care, and who, as I once heard Mr. WINDHAM describe him, was so dexterous in the se- lection and use of words, as to be able " to speak a King's speech off-hand," could not remain longer si- lent under this attack. He had been told nearly the same by Mr. SHERIDAN ; but he seemed to be willing to take the chance of that being ascribed to party motives. When, however, he heard the same se- riously urged by Mr. HUSSEY, and saw that the no- tion was making its way amongst the public, and, of course, that the whole of the calamity would be as- scribed to him and his Anti-Jacobin war, he could no longer refrain from declaring what was the na- ture of the property of the Bank, and to avow, that the whole of its transactions with Government, or nearly so, were transactions of paper -, a fact of which the country had, till that moment, been in complete ignorance. He said that Mr. HUSSEY was wholly in error, to suppose that the Bank made advances to the Govern- ment in specie ; he said, that the advances were made in notes^ and paid in the same manner ; that, if the Government were to raise money and pay the Bank, the Bank would not thereby be supplied with an additional guinea in cash ; that the taxes were not paid in specie ; that loans were advanced with- out any expectation of re-payment in specie ; that the Bank never had it in contemplation, that every quarterly dividend was to be paid in cash; that the receipt of the revenue was in paper, and that the whole "of Mr. HUSSEY'S observations were entirely founded in mistake. Mr. SHERIDAN, in answer to this, said, that the deficiency, or inability, at the Bank arose, not merely from the positive want of cash, but from the dispro- 208 PAPER AGAINST GOLD. portion between the quantity of cash, and the quan- tity of paper; and, of course, that if their lent paper was returned to them, they would find themselves at liberty to issue more of their specie. This would have been true in a state of things where the differ- ence between the quantity of specie and the quan- tity of paper was less ; but in the present case, it was too great for confidence to be restored, and, of course, for the Ba^ik to return to its payments in cash. Mr. PITT'S aimver was complete. It was the plain truth, which he wcs obliged to bring out, in order to divide the blame with the Bank. He was told to borrow and to pay the Bank what he owed them. What good will that do, said he, when my loan will consist of bank notes, and I must pay the Bank in those notes ? He was told to raise the sum in taxes, and so pay the Bank. What good will that do, said he, when my taxes ^Ul consist of bank notes, and I must pay the Bank in those notes ? The answer was complete towards h\r- adversaries in debate, and not less complete as a drrno.lisher of his own repu- tation as a Minister of finance. He now said pre- cisely what Mr. PAINE had said the year before ; he now confirmed with his ovn lips, what PAINE had been so abused for saying.* He appears clearly to * I speak here of those writings merely of Mr. PAINE, which relate to Finance, withoit wishing to convey any commendation of some of his oth^r w -kings, the subjects of which, are in no-wise connected Witb ihis subject. In the principles of finance he was deeply ski*L>a; ana, to his very great and rare talents as a writer, he added on uncommon degree of experience in the concerns of papsr-money, the rise and fall of which he had witnessed in tho American states, and in Fiance. Truth is truth, come fro.xi whom it may; and there is no greater folly than that of renting it, that of shutting one's eyes and ears against it, men. I/ because it pro- ceeds from persons, of whose conduct, in oti.u.1 respects, one may disapprove. The writings of LORD BACI^ are held, and justly held, in great estimation ; though he wia, cs our ele- gant and virtuous poet describes him, the metres*, of man- kind." The iate Lord Liverpool, Mr. Pitt, Mi. fox, Mi Sheridan, Mr. Nicholls, Mr. Hobhouse and otrui\ :MM\ .*< we shall see by-and-by, a Committee of the House cf Ccc* PAPER AGAINST GOLD. 209 have perceived his dilemma ; hut to extricate him from it was beyond the power even of his dexterity. He was obliged to acknowledge, that the whole was become a system of paper, or that he had taken the gold from the Bank ; and, of the two evils, he chose that, which would expose him to the least share of public odium. This view of the Bank's Affairs has led me fur- ther than I expected, but it was quite necessary as an introduction to that of the Acts of Parliament, which will be the subject of my next. I am, in the meanwhile, Gentlemen, Your faithful Friend. WM. COBBETT. State Prison, Newgate, Monday, November 5lh, 1810. LETTER XVI. metals." Sylvius, on the American paper- money, 1787, Introduction of the Bank Restriction Act into the House of Commons -The Origin of this Measure The Bill moved for by Mr. Pitt Suspension of the Two Acts Prohibiting Small Promissory Notes The Title and Preambles of those Acts The Principles of those Acts Title and Pream- ble of the Bank Restriction Act View of the Provisions of that Act The Legal Tender The Meaning and Applica- tion of the Word Restriction. mons, have since acknowledged the truth of the principles of Mr. Paine' s work. Events have proved the truth of them, and to point out the fact, is no more than an act of justice due to his talents, and an act the more particularly due at my hands. I having been one of his most violent assailants. Any man may fall into error, but a fool or a knave will seldom acknowledge it IS* PAPER AGAINST GOLD. GENTLEMEN, WE have now to take a view of the Acts of Par- liament^ passed in consequence of the Stoppage ot cash payments at the Bank of England ; then, to see what was, at the passing of these Acts, said by the advocates of them, respecting their duration ; and this will enable us to form a pretty correct judg- ment as to the statesman-like wisdom of those advo- cates, and also as to the probability of the Acts ever being hereafter removed, except by a total annihila- tion of the paper-money. Until the time at which the Bank Stoppage took place; until the 26th day of February, 1797, the notes of the Bank Company were considered as good as real money; because, if the holder chose it, he could, at any moment, demand and receive real money in excnange for them. But when the Bank, in the manner that we have seen, refused payment upon demand, the nature of the notes was wholly changed. They were no longer equal in value to real money ; and nothing but a species of compul- sion would, of course, induce the people to receive them in payment of any debt theretofore contracted Now then came the pinch. Now came forth the fact, that it was beyond all the pOAvers of hypocrisy, trick x and confusing verbosity, any longer to disguise; forth came the fact, that bank notes were to be, in reality, forced upon the people ; that the man, who had a debt due to him, must take them in payment; or if he refused them, be unable to arrest his debt- or : forth came the fact, aye, forth it came, aftei all the railing against French assignats; forth came the fact, that no man who held a bank note ; that no man who held a note of that company of Traders, payable on demand, could compel them to pay him, except in other such notes. Forth came this fact, and yet those who had brought the finances of the country into such a state, were still kept in power; to their management were the nation's affairs still left : to their promises did the credulous and affright- PAPER AGAINST GOLD. 211 ed people still listen ; and of their measures has the nation ever since been feeling, and will, it is to be feared, long feel, the consequences. The Order of the Privy Council (see it in Letter XI, page 159) required the Bank Company to stop paying their notes in money. The words are, " to forbear issuing any cash in payment." I beseech "you, Gentlemen, to consider well the nature of this transaction. Look back at the origin of the Bank. Consider it as it really was, a mere Company of Traders. Then view the holders of the notes, who were so many legal creditors, so many persons having a just and legal claim to be paid upon de- mand. See all these creditors at once deprived of their legal rights of payment by an order of the Privy Council, of which the Minister himself was a member. See here a Company of Traders, having promissory notes out to the amount of many millions, required by the Privy Council 9 to forbear*' to pay off the said notes ; and above all things, observe, and NEVER FORGET, that this order, or request, was made in consequence, as we have seen from the official documents, of representations made by this Cow-pant/ of Traders themselves, who, as is stated in those documents (Letter XIII, page 181) made such representations in consequence of the drain upon their cash, and of the alarm they therefore felt " >r the safety of their House. This was a fine spectacle to behold : it was a fine ing to be held forth to the world by a Minister, whose boasting about his financial resources, and about his support of public credit, had been inces- sant from the day he first vaulted into the saddle of power. If this could be done with regard to one Company of Traders, why not with regard to any other Company of Traders, or any other single Tra- der in the kingdom? If the Privy Council, avow- edly upon the representation of the Minister, were to protect this Company of Traders, against the law- ful demands of their creditors ; what reason was p :: 212 PAPER AGAINST GOLD. there, that other Traders, that other Debtors, should not be protected in the same way ; if they should " feel alarm for the safety of their house ?" We must never lose sight of this fact, that the Order in Council arose from a representation of the Minister ; that representation arose from one made to the Mi- nister, by the Bank Company ; and this latter repre- sentation arose (See Letter XIII, p. 181) from the drain of cash at the Bank, and from the alarm which the Bank Company felt for the safety of their house. This should be constantly kept in view. We should never, for one moment, lose sight of the fact, that the whole of this measure of protection to the Bank, had its origin in representations made by the Bank Company itself. And if we keep this fact steadily in view, we shall be in no danger as to coming* at a proper conclusion. Thus far, then, we have seen the transaction going no further than the Privy Council. We have seen it originate with the Bank Company, the demands of whose lawful creditors had given them alarm. We have seen the Bank Company calling upon the Minister, to know when he would interfere. And, we have seen the Minister, after saying on the 24th, that he would prepare a resolution of Council, go to the Council on the 26th, and obtain the resolution and order that we have seen. Thus the Privy Council became a party to the transaction ; and we are now about to see how the Parliament put the finishing stroke to it, by giving to the Order of Council the sanction of law ; we are now about to take a view of the Legislative Acts, by which, to use the expression of the late Lord Liverpool, paper-credit was exchanged for paper-currency, by which bank notes were moulded into paper-money. In Letter XII, page 171, we have seen how the minister first introduced to the House of Commons the project of passing a law to sanction the Order in Council ; that is to say, to sanction the refusal of the Bank Company to pay their promissory notes. We PAPER AGAINST GOLD. 213 have seen, that upon being asked by Mr. ALDERMAN COMBE, whether he meant to make the bank notes a legal tender, he knew not what to answer ; that he twisted and writhed in great apparent embarrass- ment of mind ; but, that he knew not what to answer. We have also seen, that before the House met the next day (28th of February, 1797) the meeting at the Mansion House had taken place, having been, as we have seen, previously contrived, in private, with the Minister. We have seen an account of the other meetings through the country ; and we have seen, in Letter XIV., the manner of forming the SECRET COMMITTEE, from whom came Reports (Letter XIV., p. 194, 195,) declaring the affairs of the Bank to be in a most flourishing way, and that the Company were possessed of a great surplus of means. Thus prepared, and perceiving, by this time, that his adherents were resolved to stand by him, (See Letter XIV., p. 195,) the Minister, on the 9th of March, 1797, moved for leave to " bring in a bill to confirm and continue the Order in Council of the 26th of February, for a time to be limited." This was the first motion towards making of the law for authorizing the Bank to refuse to pay its creditors their just demands ; that law, which has filled the kingdom with banks and with paper-money, and which, as we shall by-and-by see, has produced no small share of our present dangers and distress. But, before we proceed any further in the history of this ACT, which, you will bear in mind, is the ACT, which the Bullion Committee have proposed to repeal in J:\vo years from this time ; before we proceed any 'further in the history of this Act, we must shortly notice two other Acts, which were passed before it, and which, though of inferior im- portance, were the first-born of the Bank Stoppage. The refusal of the Bank Company to pay their notes was, as every one must naturally suppose, pro- ductive of the consequence of driving all the gold 214 PAPER AGAINST GOLD. coin out of circulation ; for, under such circumstan- ces, the moment a guinea, or a half guinea got into the hands of a person able to keep it, and not an ideot, it would remain very quiet in the chest of that person ; and, as the smallest notes then in circula- tion were notes foi five pounds, the difficulty in ma- king payments would necessarily be very great. The distress arising from this cause, was so great, that on the 1st of March, it was resolved by the House of Commons, to bring in a bill to legalise the issuing of small notes by private persons; and, on the same day, a bill was read a second time, for en- abling the Bank of England to issue notes under jive pounds. The reason for passing these Acts was this ; there were in existence two Acts of Parliament, which prohibited the negotiating of promissory notes and other paper of an amount under Jive pounds. These Acts are, upon this occasion, worthy of our particu- lar attention ; because they were passed upon the principle, that small paper promises were injurious to the community. The first of these Acts was passed in the year 1775, and, as will be seen from the Title and Preamble, which I beg of you to read,* * FIFTEENTH GEO. III. Chap. LI. An Act to restrain the negotiation of promissory notes and inland bills of exchange under a limited sum, witnin that part of Great Britain called England. Whereas various notes, bills of exchange, and draughts for money, for very small sums, have, for some time past, been circulated or negotiated in lieu of cas/i, within that part of Great Britain called England ; to the great preju- dice of trade arid public credit; fyc. <fc. Be it, therefore, en- acted by the King's most excellent majesty, by, and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same. That all promissory or other notes, bills of exchange, or drafts, or undertakings in writing, being negotiable or transferable for the payment of any sum or sums of money, less than the sum of twenty shillings in the whole, which snail be made or issued at any time from and after the twenty-fourth day of June, one thousand seven hundred and seventy-five, shall be, and the same are hereby declared to be, absolutely void, and of no effect, any law, statute, usage, or custom, to me contrary thereof, in anywise notwithstand- ing. PAPER AGAINST GOLD. 215 smalt paper currency was, at that time, declared by law to be of " great prejudice to trade and public credit." , There were in 1775, as we have already seen, no bank notes for sums less than TEN POUNDS, and, it was then supposed, that smaller notes would be an injury. In two years after the above Act was passed, the effect of it having been found good, ano- ther Act was passed, carrying the prohibition to any sum under Jive pounds. And, Gentlemen. I beg you to pay particular attention to the language of these Acts. The first says, that the circulation of notes for very small sums, in lieu of cash, is to the great prejudice of trade and public credit ; and, after the Parliament have had two years experience of the effects of this Act, they pass another, in which, after declaring that the effects of the former Act have been " very salutary" they extend the provisions of it from the sum of twcMy shillings to the sum of Jive pounds* Thus, then, small paper currency was proved to have been an evil ; it was proved, by experience, to have been injurious to trade and to public credit ; and, therefore, while there were no bank notes for sums less than ten pounds, the law forbade that there should be any other circulating or negotiable notes, under five pounds. Thus, as to paper-currency, stood the law in 1797, * SEVENTEENTH GEO. III. Cap. XXX. An Act for fur- ther restraining the negotiation of promissory notes, and in land bills of exchange, under a limited sum, within that part of Great Britain called England. Whereas by a certain Act of Parliament passed in the fifteenth year of the reign of his present Majesty, (intituled an Act to restrain the negotiation of promissory notes and inland bills of exchange under a limited sum, within that part of Great Britain called Eng- land,) all negotiable promissory or other notes, bills of ex- change, or draughts, or undertakings in writing, f6r any sum of moneyless than the sum of twenty shillings in the whole, &c. &c. ; and whereas, the said Act hath been attended with very salutary effects, and in case the provisions therein con- tained were extended to a further sum t the good purpose of the said Act would be further advanced. Be it, therefore, en- acted, &c. And the Act extends the prohibition to any sura under Jive pounds. 216 PAPER AGAINST GOLD. when the Bank Stoppage took place ; and, as we have already seen in the former part of this Letter, the country was, in consequence of the Stoppage, thrown into the greatest distress for the want of something to represent small sums. The manufacturers, and, indeed, all the journeymen and labourers through- out the kingdom, could not be paid in the usual manner. The coin had disappeared, as it natu- rally would the moment a bank note would not fetch its amount in guineas at the Bank ; and, the guineas and half guineas having gone out of sight, which they did instantly, there were no means of paying small sums. Therefore, the very first thing to be done, was to provide something to supply the place of the guineas and half-guineas, and, indeed, the whole of the coin, except the hammered-out shillings and six- pences, such as we now see current. For this purpose, it was necessary to pass an Act to repeal, or, at least, to suspend, the two Acts, of which we have just taken a view, and accordingly a suspension Act was passed on the 10th of Maich, 1797, the title and preamble of which Act are here inserted as worthy of attention, and as matter for future remark.* This Act, by which the suspension 1 * THIRTY- SEVENTH GEO. III. Chap. XXXIL An Act to suspend, for a limited time, the operation of two Acts o the fifteenth and seventeenth years of the reign of his present Majesty, for restraining the negotiation of promissory notes, and inland bills of exchange, under a limited sum, within that part of Great Britain called England. Whereas an Act of Parliament was passed in the fifteenth year of the reign of his present Majesty, intituled an Act to restrain the negotia- tion of promissory notes and inland bills of exchange, under a limited sum, within that part of Great Britain called Eng- land ; And whereas another Act was passed in the seven- teenth year of the reign of his present Majesty, intituled, an , Act for further restraining the negotiation of promissory notes and inland bills of exchange under a limited sum, with- in that part of Great Britain called England; and whereas IT IS EXPEDIENT that the said Acts^should be suspended for a certain time, so far as the same may relate to any notes, draughts, or undertakings made payable on demand : &c. &c. &c. The Act then suspends those laws until the first day of May t 1797. was to b< PAPER AGAINST GOLD. 217 5 to be continued only till the first day of the then ensuing month of May ; that is to say, for forty days only, was, as we shall by-and-by see, afterwards ex- tended in its duration, and has continued in force till this day. But, this was nothing without giving a power of making small notes to the Bank of England. The Bank had dividends to pay ; and, of course, all the sums, or parts of sums, under five pounds, (there being, as yet, no notes under that sum,) they were still compelled to pay in cash, which was what they did not like, and, in fact, what they were not, per- haps, able to do. It was, therefore, necessary, above all things, to give them a power of making small notes. There was a doubt whether the two Acts of the 15th and 17th of George the Third, above-mentioned, applied to bank notes ; and, it was thought by some persons, that they did not so apply 5 but, an Act of Parliament, the great cure for all doubts and difficulties, was passed to remove this doubt ; and such was the haste in doing this, that the Act was passed on the 3rd of March, though the Bill was brought in only on the 28th of Feb- ruary. This Act authorized the Bank to issue notes for sums under five pounds ; and, accordingly, two and one pound-notes were immediately issued.* Now, Gentlemen, I beg you to stop here for a moment, and take another look at the language of these Acts of Parliament, these solemn declarations of the Legislature. In the year 1775, they say, that the circulation of small notes, in lieu of cash, is of " great prejudice to trade and public credit" In 1777, they declare, upon the evidence of two years of * THIRTY-SEVENTH GEO. III. Chap. XXVIII.-An Act to remove doubts respecting Promissory Notes of the Governor and Company of the Bank of England, for payment of sums of money under five pounds. Whereas it is expedient for the public service and for the convenience of commercial cir- culation, that the Governor and Company of the. Bank of England should issue Promissory Notes, payable to bearer, for sums of money under five pounds ; &c. &c. 19 818 PAPER AGAINST GOLD. experience, that their having lessened the quantity of small notes had produced " very salutary effects." And in 1797, under the ministry of PITT, whose debts the public have paid, and for whom they are to pay for a monument ; aye, under the ministry of this man, the Parliament were brought to declare, that to make small notes, that to do just the contrary of what the above two Acts were intended to effect, was u expedient for the public service, and for the convenience of commerce." In 1775, and 1777, it was enacted, that small promissory notes, in lieu of cash, were " a great prejudice to trade and public CREDIT." In 1797 it was enacted, that small promis- sory notes, in lieu of cash, were " expedient for the public service, and for the convenience of com- merce" Gentlemen, when you have paid due at- tention to this, you will hardly want any thing more to enable you to answer those, who have yet the folly or the impudence to attempt a defence of the ministry of PITT, who, as it has been well observed, in reply to one of his eulogists, found the country gold and left it paper. But, the grand measure was yet to come. There was, as yet, no law to sanction the deed of refusing to pay the bearers of the Bank's promissory notes. This was a thing that the people had yet to receive at the hands of those, who had plunged them into the Anti-Jacobin war, and who had fed them with the hopes of beating France through her finances. Yes, the people of England, the " most thinking people," had yet to swallow this ; they had yet to gulph this bolus from the hands of those, who had buoyed them up for so many years, by comparisons of the flourishing state of the English finances com- pared with those of France, which last nation they still believed to be, as PITT told them, " in the very gulph of bankruptcy." This measure was, as we have seen, introduced into the House of Commons, in form, on the 9th ot March, 1797, in a motion made by PITT, for leave PAPER AGAINST GOLD. 219 to bring in a Bill for continuing, for a limited time, what he called the RESTRICTION (pray mark the word) upon the Bank, relative to its issue of specie. This Bill, after undergoing the discussions, some of which I shall have to notice more particularly by-and-by, became a Law on the 3d of May, 1797.* When you have read the Title and Preamble of this Act, you will accompany me in a brief sketch of its provisions, which you will find not only cu- rious and interesting, as an object of public attention, * THIRTY- SEVENTH GEO. III. Chap. XLV. An Act for confirming and continuing for a limited time the Restriction contained in the minute of Council of the twenty-sixth of February, one thousand seven hundred and ninety-seven, on payments of cash by the Bank. Whereas by minute of his Majesty's Privy Council, made on the twenty-sixth day of February, one thousand seven hundred and ninety-seven, upon the representation of the Chancellor of the Exchequer, stating, that from the result of the information which he had received, and the inquiries which it had been his duty to make respecting the effect of the unusual demands for specie, that have been made upon the metropolis, in consequence of ill-founded or exaggerated alarms in different parts of the country, it appeared, that unless some measure was immedi- ately taken, there might be reason to apprehend a want of sufficient supply of cash to answer the exigencies of the public service ; it was declared to be the unanimous opinion of the Board, that it was indispensably necessary for the public service, that the Directors of the Bank of England should forbear issuing any cash in payment, until the sense of Parliament could be taken on that subject, and the proper measures adopted thereupon for maintaining the means of circulation, and supporting the public and commercial credit of the kingdom at this important conjuncture ; and it was ordered, that a copy of the said minute should be transmitted to the Directors of the Bank of England, and they were hereby required, on the grounds of the exigency of the case, to conform thereto until the sense of Parliament could be j taken as aforesaid : And whereas, in pursuance of the minute, the said Governor and Company of the Bank of England have, since the said twenty-sixth day of February, one thou- sand seven hundred and ninety-seven, forborne to issue cash in payments, except for purposes for which the issue of cash was deemed unavoidable ; it is necessary that the Restriction in the said minute, although not warranted by Law^ should be confirmed, and should be continued for a limited time, by the authority of Parliament : Be it therefore enacted, &c. &c. &c. 220 PAPER AGAINST GOLD. but useful also to each of you as individuals, who will hence learn, how far you are compelled to re- ceive payment in bank notes, and in what way youi previous contracts have been affected by this Act. The Preamble of the Act having repeated whai was contained in the Order of Council, and having declared that to confirm and continue the refusal tc pay in Gold and Silver, though such refusal was not warranted by law ; having acknowledged the ille- gality of the things done, and declared the necessity of continuing' to do them ; having made this begin- ning, the Act next proceeds, SECTION I., to indemnify the Bank Directors, and all other persons, for having done these illegal things ; that is to say, to protect all such persons against any appeal to the law, that any suffering party might be inclined to make. So that, whatever loss, or hinderance, or injury, any man might have suffered from the non-payment of the pro- missory notes of the Bank Company, such sufferer was, by this Act, at once deprived of all legal means of obtaining redress. The Act next provides, in SECTION II., that the Bank should be liable to no pro- secution for the non-payment of any of their notes, that they might be willing to exchange for other notes ; arud, that in case the Bank were sued by any one for the non-payment of their notes, they might apply to the Court to stop proceedings in such ac- tions, who might stop them accordingly, and without costs to the plaintiff in any action brought against the Bank for non-payment of its notes, unless the Court should think the action necessary. SECTION III. permits the Bank to issue cash in payment of any sum under twenty shillings, or where less than twenty shillings should be a fractional part of a sum to be paid by the Bank. This was a very gracious permission! The same Section allows them to issue cash for the service of the Army, the Navy, or the Ordnance, in pursuance of an order of the Privy Council. SECTION IV. specifies that the Bank, during the restriction or stoppage, shall not advance PAPER AGAINST GOLD. 221 to the Government any cash or notes exceeding in amount 600,000 pounds. SECTION V. permits the Bank to repay cash to those persons thai may choose to lodge cash in the Bank. But, the Section per- mits the Bank to repay in cash, only three fourths of the amount of what shall be so lodged with them. SECTIONS VI and VII. permit the Bank to advance the sum of 125,000 pounds to the Bankers of Lon- don and Scotland. SECTION VIII. treats of payments between private individuals, and it provides, that all payments which have been made, or which shall be made, during the continuance of this Act, in Bank of England notes, shall be deemed payments in cash, if accepted as such. SECTION IX. contains the great alteration made in the law between debtor and cre- ditor. We have seen, that by the 2d Section, the bank notes were made to be quite equal to cash in the case of all demands made upon the Bank for payment of its notes; which, therefore, made the notes of the Bank, as far as related to debts due from the Bank, on account of its notes, a LEGAL TENDER, which words mean such money or currency as the law regards as good in the payment of debts. Guineas, for instance, are a LEGAL TENDER, because, the ten- der, or offering of them in payment, is sufficient to prevent any action or proceeding at law being en- tertained against the person, who may have offered them in payment, in quantity equal to the amount of the debt. But, bank notes were not made a legal tender, and they are not now a legal tender, between private individuals. If a man owe me money, I can still demand coin in payment; and the only differ- ence is, that I cannot, if my debtor tender me the amount of the debt in Bank of England notes, cause him to be arrested and held to special 6ai7, as I might have done, if this Act had not been passed. This part of the Act every one should read, and. therefore, I have put the 9th Section in a note.* * SECTION IX. And be it further enacted by the authority 222 PAPER AGAINST GOLD. SECTION X. provides that the collectors of the public revenue shall accept payment in Bank of England notes. SECTION XI. permits the Bank to issue cash, in certain cases, upon giving five days' notice to the Speaker of the House of Commons. SECTIONS XII. and XIII. provide for the continuance of the Act to the 24th of June, (a duration of only fifty-two days,) and for the repealing or altering of it during the then present session of Parliament. aforesaid, that during the continuance of the restriction on payments by the said governor and company in cash, impo- sed by this Act, no person shall be held to special bail upon any process issuing out of any court, unless the affidavit which shall be made for that purpose, according to the pro- visions in the Act of the twelfth year of the reign of his late Majesty King George the First, for preventing frivolous and vexatious arrests, shall not only contain the several matters required by the said Act, but also that no offer has been made to pay the sum of money in such affidavit mentioned, and therein sworn to, for the purpose of holding any person to special bail, in notes of the said governor and company, ex- pressed to be payable on demand (fractional parts of the sum of twenty shillings only excepted ;) and if any process shall be issued against any person, upon which such person might have been neld to special bail before the passing of this Act, and no affidavit shall be made as aforesaid, that no such offer of payment in notes of the governor arid company had been made as aforesaid, such person shall not be arrested on such process, but proceedings shall be had against such per- son iii the same manner as if no affidavit had been made for the purpose of holding such persons to special bail, under the provisions of the said Act of his said late Majesty King George the First; and all provisions in such Act, or in any other Act of Parliament, for preventing frivolous and vexatious arrests, shall be applied to the provisi9ns in this Act contained. KG far as the same are capable of being so applied : Provided always, that if affidavit shall be made, upon which any per- son or persons might have been held to special bail upon any such process as aforesaid, before the passing of this Act, and it shall be likewise sworn in such affidavit, that such offer of payment has been made as aforesaid, so that the person or Eersons who might have been arrested and held to special ail upon such process, if this Act had not been made, cannot, by reason of such offer and of the provisions in this Act con- tained, be so arrested and held to special bail, it shall be law- ful for the court out of which such process shall issue, or for any judge of such court, in a summary way, to order the de- fendant or defendants in the action in which such process PAPER AGAINST GOLD. 223 This, Gentlemen, is what is called the Bank-RE- STRICTION Act, a very convenient phrase, calcu- lated to convey the notion, that the Bank is able and willing to pay ; hut, that it is not permitted to do it. I beg you to bear along with you the meaning of the word Restriction, which implies an act done by one party, to prevent another party from doing what he would do if not prevented. To restrict is to limit or confine. I am restricted, for instance, from going out of Newgate. I am here in a state of restriction. I should go home to my farm and my family, if it were not for this restriction ; and so " the most thinking people of Europe" think, of course, that the Bank Company would pay their notes in Gold and Silver, if they were not restricted in the same manner. But of this we shall see more in the next Letter, when we come to speak of the duration of this restricting Act ; and, in the mean while, I remain, Gentlemen, Your faithful Friend, WM. COBBETT. State Pinson, Newgate, Monday, Nov. 12, 1810. shall issue, and who might have been so held to special bail as aforesaid, if this Act had not been made, 10 cause notes of the said governor and company, expressed to be payable on demand, to the amount of the sum of money for which such person or persons might have been so held to special bail, if this Act had not been made, to be deposited in such manner as such Court or Judges shall direct, 10 answer the demands of the plaintiff err plaintiffs in such action ; and if such depo- sit shall not be made within the time limited by such order, after such notice thereof, as shall thereby be directed to be given, it shall be lawful, upon affidavit duly made and filed, that such deposit has not been made according to such order, to arrest sucn defendant or defendants, and hold him, her, or them, to special bail, in such and the same manner as if the said Act had not been made. 224 PAPER AGAINST GOLD. LETTER XVII. Nothing but a law, declaring bank notes to be a legal tender of payment, can relieve the bankers and the trading part of the community from the hardships to which they are now liable ; and yet, the remedy must, in the end, be worse than the evil." Mr. Hobhouse. Speech in the House of Commons, 27th March, 1797. The legal Tender Gold is the only Legal Tender for any Sum above 25 Pounds Acts of the 14th and 39th of Geo. III. Mr. Huskisson's Remark upon the Legal Tender The Effects of a Legal Tender in Paper Illustrated by the Case of New Jersey Act against Legal Tender in Paper, 4th Geo. III. chap. 34 Mr. Huskisson's Mis-statement as to the Notions entertained respecting the Legal Tender at the passing of the Act of 1797 Mr. Sheridan's Predic- tion when the Act was moved for Sir P. Baring proposes to make the Notes a Legal Tender Mr. Pitt declines it for the present The Mansion House and other Meetings had, in some sort, effect of the Law The Law as it now stands as to the Legal Tender of the Bank of England Notes Country Bankers may be compelled to pay their Notes in Gold. GENTLEMEN, BEFORE we proceed in our inquiries as to the DU- RATION of the Act, which was the subject of the foregoing Letter, and by which the Bank of England was protected against the cash demands of the hold- ers of their promissory notes ; before we proceed in these inquiries, which will discover matter not a little curious in itself, and very interesting as con- nected with what is now going on ; before we thus proceed, I must beg your attention to a few more words upon the subject of the LEGAL TENDER. The truth is, that gold, and gold only, is a legal tender, in this kingdom, for any sum above 25 pounds, unless the silver be tendered in weight. This was settled by an Act, passed in 1774, (14 Geo. III. Chap. 42,) which Act provided, that no tender in pay- ment of money made in the Silver Coin exceeding the sum of 25 pounds, should be deemed a legal tender for more than its value by weight, at the rate of 5s. 2d. for each ounce of Silver. This Act con- PAPER AGAINST GOLD. 225 tinued in force for two years, when it expired ; but it was again revived in the year 1799, and made per- petual. Thus, you see, that even Silver coin was not, except in small sums, a legal tender, and is not a legal tender to this day. But, though the Bank of England notes were not hy the Restriction, or Stoppage Act, made a legal tender to all intents and purposes, they were made so to a certain extent ; for, by the tender of them in lieu of money, any debtor could escape arrest, and also escape the giving of special bail ; and, as to the Bank of England, the Act not only protected it against the demands of its creditors ; that is, against the holders of its notes, but by the same Act, the Bank was to pay to the public, any thing due from the former to the latter, in its notes, and not to be compellable to pay in Gold or Silver. This was going some way, at least, in making bank notes a legal tender, and this seems to have been overlooked by Mr. HUSKISSON, (a gentleman of whom we shall have much to say by-and-by,) who in speaking of the change created by the Act of 1797, in our money system, observes, that that Act did not repeal any of the former regulations relating to the coin, and that it did not alter the Act of the 39th of the King. " It did not," says he, " alter in any respect the existing state of the law, either as to the weight or the fine- ness of the gold coin ; or the Act of the 39th of the King." I have quoted this gentleman's own words, because I am not quite sure that I clearly understand them. Mr. HUSKISSON is a member of Parliament, and a pensioner, and such people are apt to talk in a style that common men cannot comprehend. Whether he means, here, that the weight and the fineness of the Act of the 39th of the King remain unaltered ; or, that the existing state of the law as to the Act of the 39th of the King remain unaltered ; or, that the Act of the 39th of the King did itself remain unaltered ; which of these may be his meaning, I cannot positively say; but, of this I am sure, that, 226 PAPER AGAINST GOLD. in all the three suppositions it was quite unneces- sary to express such meaning, seeing that the Act, which he so positively and carefully assures us was not altered by the Act of 1797, was not in existence at the time, and was not passed till two years afterwards. The mischievousness of forcing paper-money upon a people is very well known. It has been most severely felt in all the countries where it has been resorted to, and it has never failed, sooner or later, to annihilate the whole of the paper, attempted so to be forced upon the people. This was the case in all the States of North America, every one of which has, first or last, had a public debt, a paper money, a legal tender in paper, and a state bankruptcy. The last of the States, I believe, that clung to a le- gal tender in paper, was NEW JERSEY ; and, the con- sequence was, that, even in the year 1792, when I first went to the United States, that part of the Union was still suffering from the disreputation brought on it by the legal tender, which, before it was put an end to, had not only produced a total stagnation of trade, and had brought ruin upon thou- sands of people, but it had begun to drive the people out of the State ; and, had it not been put an end to, the State would long ago have been wholly depo- pulated. But we need not go abroad for any thing to con- vince us of the settled opinions of statesmen and politicians as to the effects of a legal tender in pa- per. We have only to look into our own Statute- Book, where we shall find the thing sufficiently re- probated, as in the Act passed in the year 1763, which declares such a tender to be discouraging and prejudicial to trade and commerce, and the cause of confusion in dealings, and a lessening of credit, in the Provinces where it was in use ; and, having declared this ; having laid down these as principles, the Act goes on to forbid the issuing of any more such paper ; it makes void all Acts of As- sembly thereafter passed to establish or keep up such PAPER AGAINST GOLD. 227 tender ; and it inflicts a fine of 1,OOOZ. (with imme- diate dismission, and future incapacity to fill any public office or place of trust) on any Governor, who shall give his assent to such Act of Legal Tender.* Mr. HUSKISSON, who was one of the Bullion Com- mittee, of the labours of which we shall soon see a good deal ; Mr. HUSKISSON, who enjoys a large pen- sion, paid out of the taxes raised upon the people, and who, therefore, ought to understand something of such matters ; this Mr. HUSKISSON (of whom I shall have to tell you a great deal before we have done) has just published a pamphlet, under the title of, " The Question concerning the Depreciation of our Currency stated and examined ;" to the doing of which he was, it would seem, like Rosa Matilda, reluctantly forced by the pressing partiality of friends. This Mr. Huskisson, in his pamphlet, which is, apparently, intended to justify his conduct as a member of the Bullion Committee, has said, that " if it had been proposed, at once to make bank notes a legal tender, and, in direct terms, to enact, that every man should thenceforward be obliged to receive them as equivalent to the gold coin of the realm, such a proposition would have excited uni- versal alarm, and would have forcibly drawn the * FOURTH YEAR GEO. III. Chap. 34. An Act to prevent Paper Bills of Credit, hereafter to be issued in any of nis Ma- jesty's Colonies or Plantations, in America, from being de- clared to be a legal tender in Payments of Money ; and to prevent the legal tender of such bills as are now subsisting from being prolonged beyond the periods limited for calling in and sinking the same. Whereas great quantities of Paper Bills of Credit have been created and issued in his Ma- jesty's Colonies or Plantations in America, by virtue of Acts Orders, Resolutions, or Votes of Assembly, making and de- claring such Bills of Credit to be legal Tender in payments of Money. And whereas such Bills of Credit have greatly de- preciated in their value, by means whereof Debts have been discharged with a much less value than was contracted for, to the great discouragement and prejudice of the Trade and Commerce, of his Majesty's Subjects, by occasioning Confu- sion in Dealings, and lessening Credit in the said Colonies j or Plantations : The Act then proceeds as above described. 228 PAPER AGAINST GOLD. attention of the legislature and the public to the na- ture of our circulation and to the consequences ot r-uch an innovation. But, certainly, nothing of the sort was in the contemplation of any man when first the Suspension-Act was passed." But, is this t rue, Mr. Huskisson ? Your memory fails you, I hope ; for, not only was it in the contemplation of many persons ; but several persons said, that, in effect, the bank notes would become a legal tender, and that they would, of course, depreciate. Gentlemen, it is at all times right, that the truth should be known, respecting the conduct and the characters of men in any wise intrusted with the management of the public affairs ; and, at this time, and especially as relating to this most important subject, it is right that no part of the truth should be hidden. With this conviction in my mind, I shall be rather minute in my references to what was said at the time when the Act of 1797, which pro- tected the Bank against the demands of the note- holders, was under discussion. The bill, as was stated in my last, was moved for by Mr. PITT, on the 9th of March ; and, during the debate of that very day, Mr. Fox contended, that, if the bill passed, the property of the Stock-holder must, at once, be depreciated in value ; and Mr. SHERIDAN said, that " he believed we should not long be able, after the inundation of paper to which this system gave birth, to stop them from making bank notes a legal tender, and then adieu to the ap- pearance of specie at the Bank, and soon afterwards, to the real value of the banknote." When the bill was under discussion, on the 27th of March, Mr. PITT having said, that the clause, respecting the bar to arrests for debt, did not go the length of making bank notes a legal tender, nor to take away the power of the creditor to pursue the debtor in the usual course of law, in order to obtain payment in cash, Sir FRANCIS BARING said, that he saw no means of avoiding the evil to be apprehended by PAPER AGAINST GOLD. 229 bankers and merchants, but that of making bank notes a legal tender ; and Mr. DENT was for ma- king bank notes a legal tender during the suspen- sion of cash payments. Now, what did Mr. PITT say, in answer to this suggestion from his friends? He said, that "as to making bank notes a legal tender, he thought, that, if it was possible to meet the present difficulty without it, it ought to be met without it ; that, upon a subject of so much difficulty and uncertainty, no man could speak with confi- dence ; but, that as long as the circulation rested upon paper taken by consent, he thought it would not be adviseable to have it taken by compulsion" Upon this ground, the Act was passed ; and, it is very clear, that one of the objects of the short du- ration of the first Act, which was passed for only 51 days, was, to see whether people were inclined to have recourse to the law, to compel payments in cash for debts due from private individuals to other private individuals. Every means, as we have seen, had been taken to prevent this. A planned Meeting of Bankers and Merchants had been held at the Mansion House, in London, and its resolutions for taking and circulating bank notes had been issued under the sanction of the then Lord Mayor. Simi- I lar resolutions had been issued from the several 1 benches of Justices at the quarter sessions, in all the counties ; and, indeed, as these resolutions were signed by the Clerks of the Peace, and had about them all the air of acts of authority, the effect upon the farmers and tradesmen, in general, was nearly :he same as that of an Act of Parliament, making 3ank notes a legal tender. If these means had failed, however, there can, I think, be very little loubt, thaj; the measure of making bank notes a legal tender would have been adopted ; for, the only reason which PITT offers, as we see above, for not doing it at once, is, that the people seemed, at pre- vent, to be disposed to take the bank notes as cash, tyithout compulsion; and, he very clearly meant, 20 230 PAPER AGAINST GOLD. that, if the people refused to consider them as cash, compulsion must and would be resorted to. And yet, after all this, and with these facts re- corded in the Parliamentary proceedings of the time, Mr. HUSKISSON, who was actually in office under PJTT, or DUNDAS, when the measure was discussed ; with all this before his eyes, this gentleman tells the public, that neither the making bank notes a legal tender, nor any thing of the sort, was in the con- templation of any man at the time when the Act for the suspension of cash payments was passed ; and that any proposition of the kind would have excited universal alarm, and would have forcibly drawn the attention of the legislature and the public to the possible consequences of such an innovation ! Here, gentlemen, we have an instance either of the incorrectness, I might say, the ignorance, or the insincerity, of Mr. Huskisson, who, to say the truth, is not without his temptations, as we shall by- and-by see, to draw a veil over the origin and the conduct of the originators of the measure of pro- tecting the Bank against the demands of the note- holders ; to do which, it was absolutely necessary either to make bank notes a legal tender, or to do something that should answer the same purpose. To makelhem a legal tender by law, at once, would, indeed, have been a thing so shameful as not to be endured, in the face of the principles laid down by the Parliament, in the Act of the 4th year of Geo. III. above quoted. To pass a law making English bank notes a legal tender, putting English bank notes upon a level with the colonial paper mentioned in that Act ; to make bank notes the degraded thing there described, was what could not be thought ofj until all the means of avoiding it had been tried ; but, it is, nevertheless, very clear, that if the circu- lating ; if the promulgating (with all the appearance of official authority) of the resolutions from the Mansion House, and from the benches of county Justices ; it is very clear, that if these had failed in PAPER AGAINST GOLD. 231 giving currency to the bank notes, these notes would nave been made a legal tender in all cases, and to all intents and purposes whatever. They are a legal tender from the Bank itself. They are a legal tender to the Stock-holder in payment of his divi- dends. No man can sue the Bank Company on ac- count of their refusing to give him gold for any of their promissory notes, of which he may be the holder ; nor can any Stock-holder sue the Bank Company on account of a refusal to pay him the amount of his dividends in cash. They are certainly not a legal tender between man and man, any farther than as far as relates to the barring of an arrest and of the necessity of spe- cial bail. You cannot arrest, or demand special bail from, the debtor, who tenders you the amount of your debt in Bank of England notes ; but you may sue him in the other way. The tender of bank notes secures the debtor from arrest, and from being obliged to give special bail, in the first instance ; but, it does not protect him against being finally compelled to pay in cash. If, for instance, GRIZZLE GREENHORN owes either of you a hundred pounds ; or, which is a better illustration, perhaps ; if you have in your hands a hundred and five pounds in amount of the notes of Messrs. PAPERKITE and Co., Country Bankers, and you have a mind to have gold for those notes, looking forward to a time when you may want them, and having a greater attachment to the King's picture than to the arms and crests of Paperkite and Co. In such a case, you go to Paper- kite with his notes, and demand payment of them. He tenders you, as a matter of course, Bank of Eng land notes to the amount of those of his own which you present for payment ; but you, in pursuance of your design to be possessed of a hundred of the King's pictures, demand gold, and stick to that de- mand. If he cannot, or will not, pay you in gold, you cannot arrest him, or compel him to put in spe- cial bail ; but, you can bring the ordinary action of 232 PAPER AGAINST GOLD. debt against him, the decision of which is sure to be in your favour, with the usual costs, and, while the action is going on, he is obliged to deposit the Bank of England notes in court, as the ground of being protected in the meanwhile against arrest and against the demand of special bail ; and, if he does not make this deposit, you can even arrest him, as in any other case of refusal or inability to pay. Thus, gentlemen, stands the law, with regard to the legality of a tender of Bank of England notes. The Tax-gatherer cannot refuse them in payment of taxes; the Stock-holder cannot refuse them in pay- ment of his dividends; and the note-holder cannot demand coin for them of the Bank Company or of any body else, of whom he has once received them in payment ; but any private individual may refuse them in payment of money due to him from any body but the Bank Company ; and may proceed to recover payment in real money, in the way above described. Thinking it desirable to keep this subject of the Legal Tender distinct from that of the Duration of the Act of 1797, and having necessarily a good deal to say upon the latter subject, and much inter- esting matter to develop, I shall not enter thereon till my next Letter, ; and. in the mean while, I remain, Gentlemen, Your faithful friend. WM. COBBETT. State Prison, Newgate, Monday, November 19th, 1810. LETTER XVIII. "He hoped gentlemen would direct their most serious attention to t'ne sub ject. The bill was of the utmost importance; if a paper currency were once established, how could it be got rid of? If gold and silver wore once driven out of circulation, how were they to be recovered J The sure con- sequences of paper currency would be a debt so enormous that, it. would never be removed. The old debts and the new would vanish together, and the funded property wpul I sink with them. A revolution in property mijrht produce a revolution in Government, and all those scenes of blood which liad disgraced Franco." Mr. Nicholls. Debate, 27th March, 1797. On the Bank Restriction Bill. PAPER AGAINST GOLD. 233 Duration of the Bank Stoppage or Restriction Act Reca- pitulation of the Dates of the principal Occurrences leading to the Act Apparent Reluctance with which the Bank Company submitted to the Restriction They now discover that they have no Objection to be restrained Mr. Huskis- son says that the Duration could not have been foreseen The probable Reason of this Mr. Huskisson's Places and Pensions Such a person ought to have foreseen the con- sequences of the Act Others did foresee them. GENTLEMEN, WE now come to that subject which naturally connects the proceedings and measures of 1797, with the Report of the Bullion Committee, namely, the DURATION of the Act of 1797; that Act, which was made for the purpose of protecting the Bank Company against the legal demands of the holders of its promissory notes, and which Act, as you will not fail to bear in mind, arose out of an alarm felt by the Bank Company for the safety of their House. It is very material to keep constantly in view the progress which ended in the passing of this Act, which, as you will have already perceived, did, in fact, decide the fate of the paper-money in England ; and, therefore, I will here, again, place before you a recapitulation of the dates of the prin- cipal occurrences. February 21st, 1797, the Directors of the Bank "ob- served, with great uneasiness, the large and con- stant decrease in their cash;" a deputation of them went to the Minister (Pitt) to make him ac- quainted therewith \ and, as they attributed the run to the alarm of invasion, they begged of the Minister to say something in Parliament, " in or- der to ease the public mind upon the score." February 24th. At a meeting of the Directors, it ap- peared that the " loss of cash yesterday, was above , and that about * were already drawn out this day, which gave such an alarm for the safety of the House" that a deputation was sent * There were no sums inserted. The statement of sums was left in blank, as it is here. 20* 234 PAPER AGAINST GOLD. to Mr. Pitt, to ask him when he would think it necessary to interfere. At this meeting with the Minister, it was agreed, that a resolution should be by him prepared to bring before the Council, for stopping payments in cash ; also, that a gene- ral meeting of Bankers and Merchants should be contrived, in order to pass resolutions to support public credit; and the Minister, at the recommend- ation of the Deputation, agreed to get a private meeting of the chief bankers at his house, the next day, in order then to lay the plan for a general meeting. February 26th. The Order of Council was issued, stating, that the Minister had given the Council such information relating to a run upon the Bank, as induced the Council to require, and they, there- fore, did require, the Bank Company to forbear issuing 1 any cash in payments, until the sense of Parliament should be taken upon the subject. February 27th. An immense crowd of people as- sembled early in the morning at the doors of the Bank, and in Threadneedle-street, in order to get gold for the notes they held ; but, instead of gold, they received a notification, that they might have bank notes lent to them in discounts, and that the dividends, or interests upon stock, would be paid in the same manner. Whereupon they retired, shaking their long ears, and consoling themselves with the hope, that they would get gold in a week or two, On the very same day, (27th February,) the general Meeting of Bankers and Merchants, which had been proposed to the Minister by the Bank Direc- tors, was held at the Mansion-House, in London; that is to say, the State-House of the Lord Mayor (Brook Watson) the Chief Magistrate of the City, who was Chairman of the Meeting, and who signed the Resolutions, to which, therefore, the air of authority was given. February 28th. The Privy Council, including all PAPER AGAINST GOLD. 235 the Ministers, of course, had a Meeting, and sign- ed an agreement to take and give bank notes in the same way as the Bankers and Merchants who had signed their resolutions. March 2d. The Magistrates met at the Quarter Sessions, for the County of Surrey, signed an agreement of the same sort, which was promulga- ted " by order of the Court" and was signed, like any other magisterial act, by the Clerk of the Peace. The like was done in all the other counties. March 3d. At a meeting of the Bank Company, consisting of the Bank Proprietors in general, was passed an unanimous vote of thanks to the Di- rectors, for having obeyed the Order in Council, and for having refused to pay in cash. From this Meeting, it was promulgated, that no appli- cation had been made by the Bank Directors for the order to withhold cash ; that the measure was not adopted at the instance of those concerned in the direction of the Bank ; that they complied with the order, understanding it to have been dictated by national policy, and meant to operate only for a short time ; that their affairs were in a state of the greatest affluence, and that they earn- estly hoped they would soon be PERMITTED to pay their notes in cash in the same manner as they had formerly done. March 9th. The Ministers moved in the House of Commons, for leave to bring in a Bill to sanction what had been done by the Privy Council, and by the Bank Directors ; to protect both against any legal proceedings for having done an unlawful act ; and to authorize the Bank Company to CONTINUE to refuse to pay their notes in cash, for a certain time to be named. May 3d. This Bill became a law ; and, by it the Bank Company were authorised to refuse to pay their promissory notes in cash, until the 2&th of June, in that same year; that is to say, for fifty- two-days. 236 PAPER AGAINST GOLD. Such, gentlemen, was the progress which ended in the passing of the Cash Stopping Act, which is generally called the BANK RESTRICTION Act, and which, to those from whom the above facts have been kept hidden, would, from this name, as well as from the language of the Act itself, appear to have been made without any application for such a mea- sure on the part of the Bank Company, and even against the wishes of that Company, who would, from outward appearances, be looked upon as being compelled, against their will, to refuse cash payments of their promissory notes; and to yield to this com- pulsion without remonstrating, merely from their sense of loyalty and public spirit. These outward appearances, however, have nearly lost their effect ; and it certainly would be something very wonderful, indeed, if they had not, seeing that the advocates of the Bank now complain, not of the " restriction," but of the Bullion Committee, who have proposed to remove the restriction at the end of two years ! Oh ! this is delightful. This is, perhaps, the finest instance of putting professions to the test that ever was heard of in the world. Here are the Bank Company restrained; they are re- strained from paying their promissory notes in the current coin of the kingdom ; there is, which seems very hard, a law to prevent them from paying in gold ; they would seem to have been so eager to do it, that it was absolutely necessary to pass a law to hold in their hands. Well. You have, say the Bullion Committee, endured this restraint for thir- teen long years, which is long enough in all con- science, and, therefore, we will remove this re- straint ; we will permit you to pay in gold. This kind proposition, however, instead of calling forth expressions of joy and gratitude, throws the advo- cates of the Bank Company into the utmost conster- nation and dismay, and they abuse the Bullion Com- mittee as men who have aimed a blow at the very vitals of public credit. Alas ! what, then, the Bank PAPER AGAINST GOLD. 237 j Company were not so uneasy as we thought under this restraint? They did not complain and moan, in secret, as we supposed they did, at being restrain- ed from paying their promissory notes ? Nay, hy all that is wonderful, it would seem that they like to be restrained ? To return from this digression, into which I was drawn by this strange perversity of taste in the Bank Company, let us now, after having refreshed our memories as to the progress which led to the passing of the Cash Stopping, or Bank Restriction Act, see by what means, and upon what grounds, it has been continued in force from the 3d of May, 1797, to this day ; and here, gentlemen, you will find the most curious and most valuable part of this most curious and most valuable history. One of the objects which we ought to have in view, is, to ascertain, and not only to ascertain, but to put safely upon record, so that they may be turned to at any moment, the names of as many as possible of those, who had a hand, who really aided and abetted, the measure -of what is called the Bank Restriction, that is to say, the Act to bear the Bank Company harmless in refusing payment of its promissory notes. The Bullion Committee have desciibed the consequences of that measure ; they have plainly told us what mischiefs have arisen from it; they have told us how very injuriously it has operated towards creditors of all descriptions, but they have been wholly silent as to the parties by whom the fatal measure was promoted and brought about, as well as to the parties by whom it was op- posed ; and they have also been quite silent as to the grounds, upon which the Act authorizing the refusal of cash has, from time to time, been conti- nued from May 3d, 1797, to the present day. Nay, Mr. HUSKISSON, one of the members of the Bullion Committee, who, not content with the share he took in the labours of the Committee, has, as we saw in Letter XVII., published a pamphlet upon the sub- 238 PAPER AGAINST GOLD. ject ; has not only avoided to say who it was that was the cause of the Act, hut would seem to wish his readers to believe, that those who caused that Act to be passed, could have no idea of its being continued so long, and the inference he leaves to be drawn is, that THOSE PERSONS have not been the cause of such continuance. To explain satisfactorily the probable reason why Mr. HUSKISSON endeavours to give this turn to the thing, it might, perhaps, be sufficient to tell you, that he himself has been steadily on the side of the Minister at the time when the first Act was passed, in 1797, and, also, at every renewal of that Act. This might suffice, in explanation of this part of Mr. HUSKISSON'S conduct ; but I must not omit this opportunity of introducing this gentleman to you in form. He is one of the men, whom you help to pay ; and it is possible that you will nave to pay nim as long as he lives. Therefore, you have a perfect right to know who and what he is ; what he has done, and what he is likely to da, for the people of England. Mr. WILLIAM HUSKISSON, the author of the pam- phlet mentioned in my last, owes what he has got, not to any family connexion, but solely to his own personal exertions, having, in his early days, been, according to some, an Apothecary, and, according to others, a Banker. He did not waste the precious days of his youth at schools and colleges, learning Latin and laziness. Like you and me, gentlemen, he owes nothing to pedagogues, or to pedigree ; and though he does not belong to that class of men whom PAINE calls the Nobles of Nature, yet, were Nature to give titles, she would certainly dub Mr. Huskisson a Knight. This gentleman was in France at the breaking out of the ANTI-JACOBIN war ; that is to say, the war which began in 1793, and which, as we have seen, produced such effects upon the bank-note system. He appears, from a French pamphlet which I have in my possession, to PAPER AGAINST GOLD. 239 nave been a very ardent friend of the French revo- lution, at the outset, and a speech of his, delivered in a Club at Paris, upon funds and tithes, it would do your hearts good to hear. From Paris, however, Mr. Huskisson returned to England, in 1793, having come away upon the recall of our ambassador, Lord Gower, now Marquis of Stafford, to whom, it is said, he had been useful at Paris, and who is said in return to have recommended him to the notice of those two worthy associates in power, and never-to- be-forgotten ministers, PITT and DUNDAS. They found him useful ; and, though his outset was low, he found himself, at the end of less than seven years, an Under Secretary of State, in the Colo- nial Department, and a Member of Parliament. In the winter of 1801, when PITT and DUNDAS went out of office, Mr. HUSKISSON followed them, but not without taking care to cast a look behind him ; and, by the advice of Mr. ADDINGTON, the successor of Mr. PITT, our author had conferred on him a PEN- SION, for life, to be paid out of the taxes raised on the people, to the amount of 1200/. a year ; and, af- terwards, a pension, to be paid from the same source, was settled upon his wife, Mrs. ELIZA EMILY HUS- KISSON, to the amount of 615 a year for her life, to commence at her husband's death. What a nice comfortable way this is, gentlemen, to make provi- sion for one's wife and family ! Mr. HUSKISSON'S pension was to be suspended whenever he should be in possession of an office of the annual value of 2,000 a year, or upwards ; and, when he quitted such office, he was again to receive the pension. So that he made sure of 1,200 a year for life, and 615 pounds a year for the life of his wife, if she should out live him. This shewed not only a very provi- dent, but a very affectionate disposition. But, our author did not stop here ; for he obtained the Agent- shif) of the island of Ceylon, acknowledged by him- sell to be worth 700 pounds a year, and this he still held along with the office of Secretary of the Trea- 240 PAPER AGAINST GOLD. sury, which he got in 1804, and which, at 4.000 a year salary, he held, with an interval of about fifteen months, till about October, 1809. So that, while in office, he got 4,700 a year; and, while out of office, 1,900 a year; '1,200 of which he has for life^ with a provision of 615 a year for the life of his wife, if she should outlive him. Such, gentlemen, is the history of the public life of the author of the pamphlet, of which 1 am about to speak. He is now one of the Members of Par- liament for Harwich ; he was one of the members of the BULLION COMMITTEE, and his pam- phlet, the title of which was mentioned in my last Letter, has been published for the purpose of ex- plaining some parts, and defending other parts, of the famous and immortal Report of that Committee. But as perfection is not to be expected in any thing human, this Report omits to say any thing about the grounds of the continuance, or duration of the Cash Stopping, or Rank-restricting Act ; and Mr. HUSKISSON seems to think it incumbent upon him to say some little matter upon that subject. He put himself in a ticklish predicament, when he took up his pen upon such a subject ; for, we have seen, that he was in office ; we have seen, that he was in the receipt of the public money from the year 1793 to the time when he became a member of the Bullion Committee ; we have seen, that, from 1804 to the end nearly of 1809, (with the exception of about fifteen months,) he was a Secretary of the Treasury, and it is perfectly notorious, that he was what was called the Minister PITT'S right hand man ; ( that he had, in fact, the chief actual management of ' the pecuniary affairs of the Exchequer and Treasu- ry ; that he was so closely intimate with Mr. PITT, that he was one of the few persons with him when he died ; and that he was one of the witnesses of his Will, and one of his creditors. A person thus situated, ought to have had some knowledge of the financial affairs of the kingdom. PAPER AGAINST GOLD. 241 A person thus situated, ought to have known pretty well, the nature and tendency of a measure like the Cash Stopping, or Bank-restricting Act. A person, to whom the people of England pay 4,700 pounds a year while he is in office, and 1.900 a year when he is cut of office ; a person, to whom, at the very least, we are to pay, out of the taxes, 1,200 pounds a year for his life, with a contingent 615 pounds a year for the life of his wife. Such a person, gentlemen, ought to have a mind capable of extending its in- quiries and conclusions beyond the present moment; and, in a case like that of the Stopping or Restrict- ing Act, to be able to foresee the consequences that will result. In short, the man, be he who he may, that receives from the people such pay, ought, if his department be that of the Treasury, to be ashamed to plead ignorance as to any principle, or point, connected with the subject before us. Yet, what does Mr. HUSKTSSON say, as to the du- ration of the Stoppage or Restriction Act? He is in a dilemma. To pass over the matter in silence, will not do, because he is compelled to speak of the injuries arising from the long duration of the Act; and to censure the passing of the Act will not do, because it is so well known that he was in office when it was first passed, and, also, when it was twice or three times renewed. In this difficulty, he has recourse to a plea, which he does not appear to conceive makes against himself. He wishes his reader to gather from what is said, that those uho were the cause of the Act originally, never could dream of its being continued in force so long. He says, that that Act was, when first passed, " consi- dered and proposed, as an expedient that should be of short duration, the course of the proceedings of Parliament abundantly indicates ; but if, in the year 1797, it had been foreseen, that this temporary expedient would be attempted to be converted into a system for an indefinite number of years, and that, under this system, in the year 1810, every cre- 21 242 PAPER AGAINST GOLD. ditor, public or private, subject or alien, to whom the law, as it then stood, and as it now stands, had se- cured the payment of a pound weight of standard gold for every 46 14s. 6rf. of his just demand, would be obliged to accept, in full satisfaction, about IQf ounces, or not more than seventeen shillings in the pound ; with a prospect of a still further re- duction in every subsequent year : it is impossible to conceive that the attention and feelings of par- liament would not have been alive to all the indi- vidual injustice, and ultimate public calamities, in- cident to such a state of things ; and that they would not have provided for the termination of 1he re- striction, before it should have wrought so much mischief, and laid the foundation of so much confu- sion in all the dealings and transactions of the com- munity." Here are two questions : that of the duration of the Act, and that of the depreciation of the bank notes. The latter will form the subject of a subse- quent Letter. As to the former, Mr. Huskisson would evidently have us believe, the continuation of the Act for any length of time was not foreseen, either by him, or by any body else. HISTORY, TRUTH, JUSTICE ; justice to the living and the dead : but es- pecially to the dead, demand the proof of the con- trary ; demand that you, gentlemen, and that the whole of the people of England, should know, that if PITT and his colleagues ; that, if those to whom we have paid so many thousands and hundreds of pounds, in salaries, pensions, allowances, and fees ; that, if they did not foresee the consequences of the Act of May 3, 1797, there were others who did foresee those consequences, though, unfortu- nately for the country, the parliament were deaf to their predictions, and still supported Mr. Pitt and his system. It is now more than THIRTEEN YEARS since this Act was passed ; since this deed was done ; since the blow, under which credit is now staggering, PAPER AGAINST GOLD. 243 was struck ; but it is not only necessary to justice towards individuals, but to public safety, to show who it was that did that deed, and who it was that had endeavoured to prevent the measures which pro- duced it, and foretold its fatal consequences. It is now the practice of the PITT school, when they speak of the Stoppage, or Restriction Act, to speak of it as of a thing that nobody could help ; as men speak of a flood, or thunder-storm, or any other ca- lamity, in the causing or the preventing of which, it is well known that mankind can have nothing to do. But, we must not, Gentlemen, suffer them thus to get off. They have had the sway in the country for the last twenty-six years, fifteen months ex- cepted. They have followed their own plans. They have constantly insisted that theirs were the wisest plans. They have made people feel that it was full as safe to leave their plans unattacked. Well. We have now the result before us. PITT, and his ad- mirers and adherents, have possessed the places and the powers of the state for twenty-six years ; and we now see what are the consequences. Those who like the consequences ; those who think the present state of things a good one, will, of course, be thankful that we have had such men in power ; but those who, like Mr. HUSKISSON, are able to dis- cover some grounds for apprehension, must excuse me, if I point out those to whom we owe the dan- ger ; or if, in the words of the old maxim, " I clap the saddle upon the right horse." This task must, however, be reserved for my next ; and in the mean while, I remain, Gentlemen, Your faithful friend, WM. COBBETT. State Prison, Newgate, Thursday, November 26, 1810. 244 PAPER AGAINST GOLD. LETTER XIX. ted wi i of Commons. November 22, " Thus, the measure of non-payment orieinated^with the persons hound to pay." Mr. Tierney's Speech in the House < The Reasons for the Stoppage, or Restriction, Act Mr. Pitt and his Adherents represent it as of short Duration Mr. Fox and others foretell that it will never be repealed -The Dates of the several Renewals of the Act Pretence for the first Renewal Resolution of the Bank Directors Re- port of the Secret Committee Pretence for the second Re- newal Exposure of this by Mr. Hobhouse Miserable An- swer of the Minister Mr. Tierney's Exposure of the whole Thing The Measure traced to the End of the last War. GENTLEMEN, THE task first to be performed, agreeably to the conclusion of my last letter, is, to point out to you, and I natter myself, to your children's children, those persons who bore a distinguished part in the discussions of the Stoppage, or Restriction, Act ; and, especially to show you, that that Act was not a thing that came like a flood or like thunder, as Mr. Huskisson appears to wish us to believe ; and that its duration was a circumstance which was not only foreseen, but distinctly foretold, by several of those persons, who, by the party to which Mr. Hus- kisson belonged, were represented as the enemies of their country. The Bill was, as we have seen, brought into the House of Commons on the 9th of March, and became a law on the 3d of May. Be- tween these days there were several debates upon the subject ; and you will now see, whether, as Mr. HUSKISSON would have the public believe, there was nobody that could foresee or dream of this long continuation of the non-payment of cash at the Bank. Justice to the dead as well as to the living, as was before observed, demands that the truth of this fact should be well known ; but, besides that, the knowledge of the truth here will be of great utility in the guiding of our judgment for the future. PAPER AGAINST GOLD. 245 I shall, therefore, give the very words of the several speakers upon the subject, just as they stand in the Reports of the Parliamentary Debates of that time ; and, that any one may, when he pleases, examine into the correctness of my statements, I shall give the date of the Debate from which I make my quotations. Mr. PITT, and his adherents, held a language of great confidence in the solvency, and even in the wealth of the Bank Company. You have seen, that the first Act of Stoppage, or, as it is called, of Restriction, was to last for only Jiffy-two days ; which, of itself, amounted to a declaration, that the Bank would be able to resume their payments in a short time ; and, during the debates upon the bill, in its several stages, every thing was said that could be thought of, by the Minister and his adherents, to cause the public to believe, that the suspension of cash-payments would be very short indeed. In the debate of the 23d of March, Mr. WILBERFORCE said, that " Gentlemen did not consider how much of this distress arose from the very nature of our commer- cial dealings. The credit we gave was one year, eighteen months, or two years, while we paid at six months ; so that in the progressive increase of trade it was some time before the balance flowed in. The bad effects were passed, the good were yet to come" On the 24th of March, Mr. PITT said, that, " as to the exact period, he could make no po- sitive conjecture : for he felt it difficult to say, whe- ther one month, or two, or three, would be better. But when he reflected, that it must require some time for money to circulate back from the country to the Bank, and also to be refunded from abroad, and from all the other sources from which its wealth may be derived, he could not entertain a firm hope that the restoration of the Bank could be other than gradual ; he would, therefore, limit the operation of the present clause to the 24th of June, 1797." On the 29th of March, Mr. LUBBOCK said, that " if no particular day was fixed, and the Bank began to 21* 246 PAPER AGAINST GOLD. pay specie without such notice, all would go on gra- dually and smoothly ; that he was convinced, with a very little assistance, that the Bank might go on as usual immediately, and discount freely ; if 3,000,000 were added to their capital, it would ena- ble the Bank to discount to a much larger amount, which would more than accommodate the commer- cial world : and he would venture to be d d, if such a sum would not be subscribed in twenty-four hours; this would put all to rights." On the 31st of March, Mr. PITT said, " Leave the Bank and them to exercise a discretion concerning it, which, at all events, could do no injury, and might, more than probably would, lead to the attainment of that which the Right Honourable gentleman himself seemed so anxious for, namely, the restoration of cash payments at the Bank." And, again, on the same day he said : " Probably then the cash in the Bank on the 25th of February was not yet dimi- nished then, if more cash came in, it would gradu- ally enable the Bank to open again, and resume its operations, by those slow and successive steps which would make a resumption safe." On the same day. Mr. SAMUEL THORNTON, one of the Bank Directors, said, in speaking of the clause, which in- vites people to carry gold to deposit in the Bank, that, " on the whole he considered it as a most im- portant measure, and that it would enable the Bank to resume its usual general payments long ante- cedent to the period fixed for its recovery" Thus all of them spoke either of a gradual or a speedy return to cash-payments ; and this last gentleman, a most firm adherent of the Minister, and a Bank Di- \ rector, expressed his opinion, that the Bank would be able to pay even before the expiration of thejifty- two days, for which the Act was made. Now, Gentlemen, hear the other side. You have heard the Minister PITT and his adherents. Now hear Mr. Fox and those who stood with him. But, above all things, mark the words of Mr. Fox. Look PAPER AGAINST GOLD. 247 at his predictions; and, I need not point out to you, how exactly they have been accomplished thus far, and how manifest it is that the rest are in the way of speedy accomplishment. Mr. Fox is no more ; but his words will never die. The evils he foretold, and that he laboured to prevent, have ail come upon us, or noAV menace us with horrid aspect. In the debate of the 7th of March, Mr. HOBHOUSE said : " But we are told that this bill is to exist for a short time only. Has the right honourable Chan- cellor of the Exchequer considered what is likely to take place when this bill shall expire ? Will not the holders of Bank of England notes, the very moment that the suspension of payment in specie is at an end, rush in large bodies to the Bank and demand specie ? Having been once deluded, will they ever expose themselves to the risk of being deluded a second time ; having once lost the opportunity of converting their notes into specie by a sudden and unexpected Order of Council, will they ever volun* tarily become holders of such notes again? The least wound given to public credit is not easily- healed ; public confidence once lost, is not easily recovered." What Mr. NICHOLLS said, in the debate of the 22d of March, we have seen in the Motto to Letter XVIII. In the same debate Mr. Fox said, that " He knew not what the duration of the bill was intended to be, whether for three weeks or for three or six months ; but this he knew, that the longer the duration, the greater our difficulty 'would be; and he must be a sanguine man indeed, if he thought the country would not be ruined in its cre- dit, if this bill continued for six or eight months. There were some persons who confessed that this evil could not be removed during the war : he agreed with them.; but he doubted whether it could be removed EVEN IN PEACE, unless that desira- ble event should take place very soon. Every hour that it was delayed, diminished our chance of re- moving the calamity. If we had not peace in the 218 PAPER AGAINST GOLD. spring of 1797, what should we say in the autumn ? This was a question which did not depend on the taking of a town or a fortress. An enumeration of many successes in that respect would be of no avail. This was a time in which we should not conceal any thing from the public. A new loan of several millions was speedily wanted, which certainly would not tend to improve the situation of paper credit. He could not bring himself to state the circumstances of this country without the most painful anxiety. The House ought to consider that this country was now on the brink of a dreadful precipice, and that one false step might throw it into a gulf, out of ^hich it never could rise" In the same debate, in answer to a remark of Mr. PITT, " that an increase of Bank notes would hasten the period of cash payments" Mr. Fox said, that " to say that paper differed from the nature of every thing else, and that it was valuable in proportion as it was plen- tiful, and not as it was rare ; and that the abun- dance of paper would incline people not to hoard guineas, but would induce people to carry them to the Bank, were propositions so inconsistent with sound reasoning, that he was ashamed of calling up principles so merely elementary, and which were as clear as the simplest propositions of mathematics." In the same debate, Mr. SHERIDAN said, that " There would be no end to the bill, should it be carried into effect. He would repeat, therefore, what he had said before, that it would be better to suspend the proceeding altogether, than to hazard the evils which its enactment, without the prospect of a li- v mitation, would produce." In the same debate, Sir WILLIAM PULTENEY said : " Does any man, in his senses, imagine, that if this stoppage of payment in specie is to be of long duration, that the merchant will not advance the price of his foreign articles ? This appears to me to be a great evil ; and I have no idea of assenting to any bill of this kind, unless the duration be fixed, and irrevocably limited to a PAPER AGAINST GOLD. 249 short period." In the debate of the 24th of March, the same gentleman, Sir WILLIAM PULTENEY, said, that " he was of opinion that the longer the period was, the heavier would our difficulties grow. It was useless to say, that cash might Jlow back from the country and from abroad ; lor, while we were waiting for that reflux of specie, our destruction must ensue ; it was impossible to restore the Bank by the balance of trade to which the right honour- able gentleman, Mr. PITT, alluded. The theory was false, and nothing solid could be expected from it. Three weeks had already been given to the Bank, and he was willing to grant it one month more ; if, then, it could not pay, we must look for some other remedy : for that now proposed would be found of no avail. We should be only compelled to prolong the restriction from one period to another, till our paper met the fate of the French assignats" Such, Gentlemen, were the opinions expressed, upon this part of the subject, when the cash-stop- ping bill was first before the House of Commons. You see, then, that, while Mr. PITT and his adhe- rents were full of confidence of the Bank being able to return to its payments in cash ; while they saw no danger at all from this measure ; while they thought that the invitation contained in the Act for people to bring money into the Bank Shop would again fill the Shop with real treasure ; while they, and especially Mr. WILBERFORCE, described the Stop- page of cash-payments rather as a sign of prospe- rity and riches than the contrary ; while they did not, as Mr. HUSKISSON says, dream of the Act being continued for a length of time ; while their opi- nions, or, at least, their declarations, were of this sort, the declarations on the other side of the House, the declarations of those whom this " most think- ing" nation would not believe, the declarations of those whom this " most thinking" nation were per- suaded to look upon as its enemies and as the friends of France, were just the contrary. Mr. Fox and 250 PAPER AGAINST GOLD. his party not only foresaw, but they foretold, what has since come to pass. They said, that, if the Act was once passed, it must go on ; and they gave rea- sons for their opinion, reasons that were not attempt- ed to be overset by other reasons, and that were op- posed by nothing but abuse or foul insinuation. Having, now, as far as relates to this point, done justice to the parties who took a part in the debates upon the occasion referred to; having shown that Mr. HUSKISSON has not fairly represented the matter ; having shown that Mr. PITT and his adherents either meant to deceive the nation as to the ability and willingness of the Bank to return to payments in cash, or were themselves ignorant of the natural consequences of the measure, and that they had ei- ther less sincerity or less knowledge, than their op- ponents; having placed this important part of the subject beyond the power of future misrepresenta- tion, we will now trace this famous Act of Parlia- ment through its several renewals, from its first pass- ing to the present day. In the whole, there have been Six Acts passed ; the original Act, of which the seve- ral clauses are mentioned in Letter XVI. p. 216, and Five Acts of Renewal. There are, in some of these Jive, trifling deviations from the original Act; but, these are very unimportant. The great provisions about stopping cash-payments, about protecting the Bank Company against the demands of their creditors, and about the protection from arrests in individual cases, are all preserved, are now in full force, and, therefore, the alterations are of no material consequence. We have seen the title and preamble of the Act before, at page 216, and it will be best, before I offer you any observations upon the reasons, which at the different renewals, were stated in justification of the measure, to furnish you with the dates of the six Acts, that you may, if your affairs should require it, and opportunity enable you to do it, refer to these Acts yourselves. THE FIRST was passed in the 37th year of the PAPER AGAINST GOLD. 251 reign of George III., and is, of the Statutes of that year, Chapter 45. The date, according to the com- mon way of dating, is 1797, and on the 23d of May. To continue in force to the 24th of June, 1797 ; that is to say, for only Jifty -two days. THE SECOND: 37th year George III. Chapter 91. That is, in 1797 ; and the day when the Act passed was the 22d of June ; to continue in force 'till one month after the commencement of the then next Session of Parliament ! Mark this. See what a leap was taken. But you will see a greater presently. THE THIRD: 38th year George III. Chapter 1. That is, 1797 ; and the day when the Act was passed was the 30th of November; to continue in force, Hill one month after the conclusion of the then war by a definitive treaty of peace ! Bravo ! See how it gains strength as it goes. Give them an "inch^ and they'll take an ell" says the old proverb. But we have not yet seen the boldest leap. This Act, mind, was to protect the Bank Hill the end of the war; and the reasons for that we shall see by-and-by. THE FOURTH {Peace was now come, observe:) 42nd year George III. Chapter 42. That is, 1802; and the Act was passed on the 30th of April ; to continue in force (though peace was made) till the 1st of March, 1803. We shall, by-and-by, see the reasons that were given for this. These reasons are the interesting matter. THE FIFTH (Peace still continuing:} 43d year George III. Chapter 18. That is, 1803 ; and the Act was passed on the 28th of February ; to continue in force till six weeks after the commencement of the then next session of Parliament. This was the second renewal after the end of the war. The second renewal during peace. THE SIXTH (War was now begun again:) 44th year George III. Chapter : That is, 1803 ; and the Act was passed on the 15ih of December; to continue in force till six MONTHS after a conclu- sion of a definitive treaty of peace ! 252 PAPER AGAINST GOLD. This last, gentlemen, is the Act which is now m force. This is the Act, which now protects the Bank Company against the demands of the holders of their promissory notes. This is the Act, which the BULLION COMMITTEE recommended to be repeal- ed in such a way that the Bank Company shall be compelled to pay again in cash in two years from this time. You will now be so good as to recall to your minds, that the main question for us to deter- mine is, whether, if such a law were passed, it is likely that it could be executed : in other words ; whether it be likely that the Bank Company will ever again be able to pay their noles in money. This is the main question for our determination, because upon that question hangs the whole paper system ; and, in order the better to enable ourselves to determine that question, and, also, to complete the history of the Bank Company and the Bank, Stoppage, or Restriction, as they call it, we must now take a view of the REASONS, which, at the several renewals of the Stoppage, or Restriction Act, were urged in justification of the measure. The FIRST Act was, as we have seen, proposed to the Parliament by the Minister, and defended by him and his adherents, upon the ground of necessity. The drain of cash was said to have been sudden, and unusual, arising from false alarms of inva- sion. The emergence was said to be temporary. The stoppage was acknowledged to be a great evil; but it was maintained, that it was absolutely neces- sary, as the only means of avoiding a greater evil. It was, particularly by the then Attorney-General, (now Lord Eldon,) and by the then Solicitor-Gene- ral, (now Lord Redesdale,) urged, that the measure was necessary to the safety of the public creditor, or Stock-holder; because, if the run upon the Bank had not been checked by force of law, the Bank would have been totally ruined, and, of course, that the Stock-holder would have lost his all. But, (and I beg you to mark it well,) wl\en the PAPER AGAINST GOLD. 253 SECOND Act came under discussion, in June, 1797, the Minister, and his adherents, began to hold a dif- ferent sort of language, and to speak of the Act, not as the less of two evils, but rather as a measure adopted from choice, and not from necessity. This Act, which was thejirst act of renewal, had for its forerunner, a correspondence between the Minister and the Bank Directors. His letter to them was dated on the 12th of June, and their answer on the 13th. These letters having been prepared, he, the minister himself, moved, in the House of Commons, on the 15th of June, that the said letters should be laid before the House, which was done. And, what do you think, gentlemen, that these letters contained ? Why, the minister's letter told the Bank Directors, that he did not think that it was expedient, that they should begin again to pay in cash, at the time specified in the first Act of Parliament ; and they, very submissively, acquiesced in the minister's opinion ! Now, pray do not laugh, gentlemen ; for, you will find, in the end, it is no laughing matter. These two Letters, and nothing in the world be- sides, were made the ground of a legislative pro- ceeding ; made the ground, and the sole ground, for continuing, for five months longer, an Act of Par- liament, which protected the Bank Company against the demands of their numerous creditors, the holders of their notes. In the course of his speech, the Mi- nister, the " heaven-born Minister," said, " that he had the satisfaction to say, that there was, in the affairs of the Bank, with regard to the means of payment in cash, an improvement that was highly consoling, and that the apprehension of their not recovering their ability to pay in the accustomed manner, had been greatly exaggerated, when the subject first came before the House." He said, in another part of his speech, that a he was still anxious to come to the termination of the restriction; and, although that could not be on the day appointed, yet 22 254 PAPER AGAINST GOLD. it was a satisfaction to the public to find, that the inconvenience of the measure was much less than had been foretold, and that, indeed, the consequence of the measure had been the reverse of what had been predicted by its opponents." Without more ado, the bill was brought m, and was passed, as we have seen, in seven days after- wards, without any further debate about the matter. Four fifths of the House of Commons were still at the back of the Minister ; he appears to have lost not a single vote in consequence of the state to which it was now manifest he had brought the af- fairs of the nation ; there were still the same majo- rities for him in the House, and there was still the same shouting for him at Lloyd's ; the majority of the nation, partly from folly, partly from fear, partly from the influence of the paper system, were still as loud in his praises as ever, and Mr. Fox. apparently wearied with exertions, which afforded no hope of success, left the people to feel the effects of their in- fatuation. But, when the THIRD Act came to be passed, in November, 1797, a little more preparation was ne- cessary ; and it was also necessary to find out new reasons, a quite new doctrine, in justification of it; or. to acknowledge, at once, that the Bank was una- ble to pay. The refusal to pay their notes in cash, had now lasted for nine months ; the alarm of in- vasion was over; and it appeared difficult to con- ceive any reason whatever for the continuation of the Stoppage, or Restriction Act, other than that of the inability of the Bank Company to pay their notes in money. Other reasons were, however, found out; but, by way of preparation, another SE- CRET COMMITTEE was now appointed in the House of Commons, which Committee were, as we shall see, the vehicle through which the new doc- trines first made their way into that House. This Committee, by the hands of Mr. CHARLES BRAGGE, (now Bragge Bathurst, and Member foi PAPER AGAINST GOLD. 255 Bristol,) made their Report to the House on the 17th of November, 1797 ; and, I will venture to say, that a more curious document never was produced in the world. Every syllable of it is worthy of your at- tention; and I beg of you to go carefully through it before you proceed any further. The Report was, in part, grounded upon a copy of a Resolution of the Bank Directors, which had been passed some time before, and which was laid before this Com- mittee of Secrecy. I shall insert this Resolution first ; and I must again beseech you to read every word of both documents with attention; for, you may be well assured, that the whole world never saw such documents before.* * Resolution of the Court of Directors of the Bank. At a Court of Directors, at the Bank, on Thursday the 26th October, 1797. RESOLVED. That it is the opinion of this Court, That the Governor and Company of the Bank of England are enabled to issue specie, in any manner that may be deemed necessary for the accommodation of the public ; and the Court have no hesitation to declare, that the affairs of the Bank are in such a state, that it can with safety resume its accustomed functions^ if the political circumstances of the country do not render it inexpedient : but the Directors deeming it foreign to their province to judge of these points, wish to submit to the wis- dom of Parliament, whether as it has been ONCE JUDGED PROPER TO LAY A RESTRICTION on the payments of the Bank in cash, it may, or may not, be prudent to continue the same. The Committee of Secrecy, appointed to inquire whether it may be expedient further to continue the Restriction, con- tained in two Acts, made in the last Session of Parlia- ment, respecting payments in Cash by the Bank ; have in- quired accordingly, and agreed upon the following Report ; viz. Your Committee have, in the first place, examined the total amount of out-standing demands on the Bank of England, and of the funds for discharging the same ; and find, from the examination of the Governor and Deputy Governor of the Bank, and the documents produced by them, that the to- tal amount of out-standing demands on the Bank was, on the llth day of this instant November, 17,578,910/. ; and that the total amount of the funds for discharging the same (with- out including the permanent debt due from Government, of n.686,800/., which bears an interest of three per cent) was, 256 PAPER AGAINST GOLD. This Report, this matchless, this immortal Re port, having been laid before the House, having been submitted " to the Wisdom of Parliament," the on the same day, 21,418,460Z, ; leaving a balance of surplus in favour of the Bank, (exclusive of the above-mentioned debt from Government,) of 3,839,550Z. Your Committee next proceeded to examine the principal articles of which the above mentioned sum of 21,418,4GO/. t being the credit side of account, is made up, with a view of ascertaining how far the Bank might be enabled to resume its accustomed payments in cash, in case the restriction at present subsisting should be removed : and your Committee find, that the advances to Government have, on the one hand, been so much reduced, since the 25th of February last, as to amount, on the said llth day of this instant November, to no more than the sum of 4,258, 140Z. while, on the other hand, the cash and bullion in the Bank have increased to an amount more than Jive times the value of that at which they stood on the same 25th of February last, and much above that at which they have stood at any time since the beginning of September, 1795. Your Committee farther find, that the course of exchange with Hamburgh is, at present, unusually favourable to this country, and that, from the situation of our trade, there is good reason to imagine it will so continue, un- less political circumstances should occur to affect it. Your Committee next proceeded to examine the Governor and De- puty Governor of the Bank ,as to their opinion of the inconve- nience which may have arisen from the restriction imposed on the Bank from making payment in cash, and of the expediency of continuing such restriction; and your Committee find, that they are not aware of any such inconvenience, and that they are supported in that idea, by knowing that the bankers and traders of London who had a right by the Act of Parliament to demand three-fourths of any deposit in cash which they had made in the Bank, of 500Z. or upwards, have only claimed about one sixteenth : and your Committee find, that the Court of Directors of the Bank did, on the 26th of October, 1797, come to a resolution, a copy of which is subjoined to this Report. Your Committee having further examined the Governor and Deputy Governor, as to what may be meant by the political circumstances mentioned in that resolution, find, that they understand by them, the state of hostility in which the nation is still involved, and particularly such apprehensions as may be entertained of invasion, either in Ireland or this country, together with the possibility there may be of advances being to be made from this country to Ireland : and that from those circumstances so explained^ and from the nature of the war, and the avowed purpose of ike enemy to attack this coantry by means of its public credit, and to distress it in its financial operations^ they are led to PAPER AGAINST GOLD. 257 {c heaven-born Minister" rose to move, at once, with- out any time for printing the Report, to bring in a bill to extend the duration of the Act of Stoppage, or Restriction, as it is called. He said, that he would, however, move for the printing of the Re- port, " in order that all the Members might have the satisfaction of informing themselves, in detail, of statements so very pleasing and important; those gentlemen, he said, who had now heard the report read, would think with him, that after the full exa- mination the subject had undergone in the Com- mittee ; after the clear and decided opinion that Committee had pronounced upon it ; and after the distinct statement not only of them but of the Bank Directors ; it would be unnecessary to detain the business merely on account of the printing ; and that it would be proper to proceed without delay to the object of that Report ; and move for leave to bring in a bill for that purpose." He further said, that it was necessary to continue the restriction during the. war to defeat the object of the enemy, which was to destroy our credit ; that the further continuation of the restriction could not reasonably produce any alarm or apprehension, since they had now indis- putable evidence before them, that, so far from the gloomy predictions of the opponents of the measure having been verified, the national credit had rapidly think that it will be expedient to continue the restriction now subsisting, with the reserve for partial issues of cash, at the discretion of the Bank, of the nature of that contained in the present Acts ; and that it may be so continued, without inju- ry to the Credit of the Bank, with an advantage to the na- tion. Your Committee t therefore, having taken into con- sideration, the general situation of the country, are of opinion, that notwithstanding the affairs of the Bank, both with respect to the general balance of its accounts, and its capaci- ty of making payments in specie, are in such a state that it might with safety resume its accustomed functions, UNDER A DIFFERENT STATE OF PUBLIC AFFAIRS, yet, that it will be expedient to continue the restriction now subsisting on such payments, for such time, and under such limitatious, as to the wisdom of Parliament may seem fit. 258 PAPER AGAINST GOLD. risen to the high condition of prosperity which had just been exhibited. At the end of this harangue, he moved for leave to bring in a bill for continuing the Stoppage of cash-payments, at the Bank, till a month after the conclusion of a definitive treaty of peace ; which, by the Representatives of " the most thinking people in the world," was agreed to without a single dissenting voice ! When, however, the subject came to be discussed again on the 22d of November, the thing was not suffered to pass off in silence. Mr. HOBHOUSE ob- served upon the new doctrine which was now brought forward in defence of the measure : " He reminded the House, that he had said on a former occasion, that this would be the case ; and now the Minister was making good his predictions, alleging as a rea- son for so doing, that the nature of the contest in which we are engaged demanded it, though this was no part of the grounds for the former restric- tion^ and though in comparing the war now with its nature at that time, it did not appear there was any material difference. Why the nature of the war, then, made a restriction of six months only ne- cessary, and its nature now made a restriction during the contest necessary, he could not discover ; to him it appeared absurd and irreconcilable to common sense and sound policy." What answer was given to this by the Minister ? What answer could he give ? He had, in fact, nothing to say. He repeated all the former assertions about the riches of the Bank, though those assertions evidently made against him ; and, as to the main argument, what did he do, but rely solely upon the opinion of the Secret Committee, a Committee, who had, in fact, been chosen by his own adherents. He said : u As to the plan of con- tinuing the restriction for the whole term of the war, the reasons for it being stated distinctly in the Re- port of the Committee, it was unnecessary for him to say a word more upon the subject; it would be found there distinctly set out that the Bank was in PAPER AGAINST GOLD. 259 a state which in ordinary times would enable it to resume its cash payments and operations on the ac- customed scale. But that the avowal of the enemy to attack us through our finances, and to ruin our public credit, was the motive (he presumed a suffi- ciently cogent motive) to make an additional term of restriction ; and when it was remembered that no injury nor even inconvenience, had been sustained by the restriction hitherto, the House could not but think it a sufficient encouragement to adopt that now called for." In a subsequent stage of the bill, the next day, he said : " We were contending with an enemy whose object was to attack the credit of the country, and to embarrass its financial operations. It was necessary to meet these attacks in a manner that would defeat the object of the enemy. The House should take every measure to ward off the danger, and the present was, in his opinion, the best that could possibly be adopted." Mr. HUSSEY ha- ving pressed him closely upon this point, he further said, that, " It was necessary to hold out to the enemy, that the country was prepared to meet all its efforts of desperation ; but it did not follow that the re- striction would be continued during the whole of the war. While, however, it was pursued in its present shape, he certainly considered the restriction as ab- solutely necessary." These miserable reasons; these most pitiful pre- tences, Mr. TIERNEY exposed, in his speech of the 22d of November, in a manner so complete, that one is shocked at the thought of the House afterwards suffering the measure to proceed ; one cannot help wondering, that the Minister was able to sit and hear him ; and, it is impossible to feel any compas- sion for the people who still supported and extolled him ; and who richly merit all that could, or can, be- fall them from that cause, they having supported him with their eyes open, and against the clearly and loudly expressed dictates of reason and truth. Mr. TIERNEY said : u that the enemy would aim a 260 PAPER AGAINST GOLD. blow at our credit and finances, all would agree, for all modern wars have been, without exception, car- ried on upon that principle. Modern wars are made upon resources rather than blood ; but was this the way to prevent the enemy from succeeding ? most whimsical expedient ! In order to leave the enemy no credit to attack, they destroy credit themselves. But at last, they speak plainly, at last, it comes out, it will distress the financial operations of the coun- try ; and then they deliberately weigh and find that it will be expedient to continue the restriction with the reserve of partial issues of cash at the discretion of the Bank, and that it may be so continued with advantage to the nation, and without injury to the credit of the Bank. This was the result of the ex- amination of the Governor and Deputy Governor of the Bank of England. This was their advice. This precious plan, which first originated in the dia- bolical, but fertile mind of that monster Robes- pierre." Mr. TIERNEY, in this speech, which was one of the best made upon the occasion, and to which I do not pretend to do full justice, then showed how clear it was, that the Bank Company and the Minister went hand in hand through the whole of the transaction ; that their operations were intended to screen one another ; that the Bank Company called upon the Minister for protection ; and the Minister made that the pretext for his propositions to Parliament. He observed, that the principal reason for continuing to protect the Bank from paying their notes, came from the Bank Directors themselves, who even before the meeting of Parliament had come to a resolution, that they were able to pay if the political circum- stances of the country did not render it inexpe- dient, but that the stoppage of payments in cash having been ONCE judged proper, they submitted to the wisdom of Parliament, whether it would not be proper to continue the same. " Thus," said Mr. TIEBNEY, " the measure of non-payment originated PAPER AGAINST GOLD. 261 with the persons bound to pay ;" and who, from the language of the Act, the world would believe were restrained against their will from paying. From the Report of the Secret Committee, you will have perceived that the Bank Company of Traders, were the chief source of the Committee's information; for the Committee say, that, having asked them what they meant by those "political cir* cumstances" of the country, mentioned in their Re-* solution, the Bank people told them, that they al- luded to the war in which the country was engaged ! Upon this; aye, upon this ground, suggested by the Bank Company themselves, did the Committee re- port, that it would not be safe for that Company to pay its notes during the war ; and upon the same ground did the House of Commons come to a like determination. Gentlemen, were not these facts fresh in our me- mories ; were they not capable of proof by living witnesses ; nay, were they not proved by the exist- ence of the Act of Parliament, of which we are speaking, would they, could they be believed? could they be believed to have taken place in any nation upon earth ; and, especially amongst a people calling themselves " the most thinking people in the world ?" Thus have we traced down this Act of Stoppage, or Restriction, as it is called, to the end of the last war. We have seen that its continuation was at last justified upon the ground of its being dangerous for the Bank to return to money payments DURING THE WAR. And now we have to see what rea- sons were given for continuing the restriction, or re- fusal to pay, AFTER THE WAR WAS OVER. But this, by no means the least interesting part of tjie subject, must be reserved for another Letter. In the meanwhile, I remain, Gentlemen, your faithful friend, WM. COBBETT. State Prison, Newgate, Thursday, December 4, 1810. 262 PAPER AGAINST GOLD. LETTER XX. " The English are a sober, THINKING people, and are more intelligent and more solid than any people I ever bad the fortune to see." Lord Stor- mont's speech in the House of Lords, 1st Feb.,, 1792. The War being now over, Mr. Pitt's Reasons ceased of course The Peace brings no Golden Payments at the Bank Mr. Addington becomes Minister Gives Notice of an Intention to continue the Act of 1797 Mr. Robson calls for Papers, which are refused He compares Bank Notes to Assignats, and is himself called to Order Mr. Addington's reasons for renewing the Act in April, 1802 His Reasons for another Continuation of the Bill in February, 1807 Mr. Tiernev calls for Inquiry The Act renewed again, in Dec. 1803, till sixth Months after Peace. GENTLEMEN, IN Letter XIX., page 244, we traced the Bank Stoppage or Restriction Act, down to the end of the last war, in the year 1802. We saw it introduced under pretence of the absolute necessity of a tempo- rary purpose ; we saw it passed, at first, for only fifty-two days ; and with every expectation held forth, that it would be repealed before the expira- tion even of that time ; we then saw, that it not only lived for the fifty-two days, but, at the expiration of that time, was prolonged for Jive months ; and, when the end of that five months came, we saw it pro- longed for the duration of the war, upon the ground, that the enemy had openly avowed his determina- tion to effect the destruction of our public credit, and that, therefore, it was necessary to keep upon the defensive. This was the precise ground stated by the Minister himself. The enemy had avowed his determination to destroy our credit, and therefore the Bank was to l)e protected from paying its pro- missory notes, agreeably to the conditions on wliich these notes had been received in payment. The enemy had avowed his determination to blast the credit of England, and. therefore^ the Bank of Eng- PAPER AGAINST GOLD. 263 land was to stop payment with impunity, as long as the war should last. Such were the reasons, such the doctrine, to which was at last driven the " Grand financier," Mr. PITT, who had begun his career by bespeaking a co- lumn to his memory, on which the words " PUBLIC CREDIT," should be inscribed ; such was now the doc- trine of the " heaven-born minister ;" " the Pilot that weathered the storm ;" " the great statesman now no more." He weathered the storm so ably, that, at the end of only four years of his war against the Re- publicans of France, during which four years he had, perhaps, forty times foretold that France would sink beneath the weight of bankruptcy, he himself comes into the same House of Commons where his promises to ruin France had been so often heard, and there he calls upon the members to protect the Bank of England in non-payment of its notes ; he calls upon them for a law to compel the Public Creditor to take his dividends in a paper not conver- tible into gold ; and, his reason for this is, that the French, that those same French, that the bankrupt French, that the beggared French, threatened to make war upon our finances ! Aye, he, the*boaster, who had made so many, so many scores, of tri- umphant comparisons between the situation of Eng- land and France ; who had so many scores, I might say hundreds of times, (for -he frequently did it seve- ral times in one speech) represented England as so highly blessed in wealth and credit, while France was sunk into the lowest abyss of poverty, and threat- ened with all the evils attendant upon a debased paper-money ; he, this very same man ; the identical " heaven-born-minister ;" now asked for a law to pro- tect the Bank against the demands of the holders of its notes, and to compel the Public Creditor to re- ceive his dividends in that same sort of notes or not at all ; and, all this he did, because those same poor, ruined, beggared, and beaten French, had avowed their intention of making war upon our finances. 264 PAPER AGAINST GOLD. But, at any rate, this reason held good only ditr ring the war. The " heaven-born man," as we have seen in the last Letter, expressly stated, that the measure was a mere war measure, intended to meet the hostility of the enemy ; " to meet his ef- forts of desperation" But, it did not follow, he said, that the non-payment of cash would continue during the whole of the war ; hut merely while the enemy pursued the war in its then " present shape" So that, at all events, it was believed, or, it was in- tended to make this " most thinking people in the world" believe, that the measure would last only for the war at longest, and that when peace returned, they would once more get guineas for their notes, and that those of them who had dividends to receive, would receive them in gold if they chose, as they formerly used to do ; and, this, was one of the rea- sons why the nation so anxiously wished for peace. Well, in 1802, Peace came ! But, alas ! it brought no guineas in payments at the Bank. It brought with it no golden payments to the Stock holder, or Public Creditor^ as some people call him. Peace brought no repeal of the Bank Stoppage, or Restric- tion Act. On the contrary, it did, as we have seen at page 251, bring an extension of the duration of that Act from the 30th of April, 1802, to the first of March, 1803. And thus it was that the promise was kept. Thus it was that " the most thinking people in the world" saw their "heaven-born Minister's" doctrines verified. But, what was now the pretence for continuing this Act ? The war was over. The shoutings and the bon-firings and the bell-ringings for peace had taken place. Mr. ADDINGTON, the prime minister, and Lord HAWKESBURY, the negotiator, had been praised in all manner of ways for the " blessings of peace." What, then, could be the pretence for continuing the Stoppage Act ? You shall hear. Gentlemen; for it is impossible to do justice to the PAPER AGAINST GOLD. 265 reason except in the words of the Minister himself and of those who supported him. You must remember, Gentlemen, that just before the peace was begun to be negotiated, the " hea- ven bonr' and some others went out of office, and that Mr. HENRY ADDINGTON, now LORD VISCOUNT SIDMOUTH, succeeded him, as prime minister. To his lot, therefore, it fell to propose the continuation of the Stoppage Act, in peace ; but, you should bear my mind, that this was, in fact, no change of ministry ; it was merely a change of a very few of the men in power. All those who had voted for PITT, continued to vote for his successor, as did also Mr. PITT himself. So that the continuation of the Stoppage Act is not to be ascribed, in anywise to this change of men, the people still in power being the same people who supported all the mea- sures of the minister, PITT, and who, indeed, brought him back into power again in the year 1804. It was on the 9th of April, 1802, that the continua- tion was proposed by Mr. ADDINGTON ; but notice of his intention having been before given, Mr. ROBSON, on the 2nd of April, moved for certain papers, show- ing the nature of the affairs of the Bank, which was opposed by the Minister, ADDINGTON, who, without more ado, moved the previous question upon it. Whereupon Mr. ROBSON said, that this was using him, and those who thought with him, very ill. Notice had been given, he said, by the minister, of his intention to bring in a bill to continue the Act, which protected the Bank from paying in gold and silver, and, he wished to know how the affairs of the Bank stood, that he might be able to judge whether he ought to consent to such a measure or not. " He maintained that all Europe was contemplating the payments of specie by the Bank, as the criterion of the credit of the Country. If the Bank continued to issue paper, country banks would do the same with- out control ; they would issue their notes without mercy. It was, in his opinion, THE COMMENCE- 23 266 PAPER AGAINST GOLD. MENT OF A COURSE OF ASSIGNATS. ( Order ! order I and question I was called from every part of the House") The question being put, it was carried against Mr. ROBSON, without a division. He was not al- lowed to have the papers he wanted. It was unne- cessary, he was told ; and, when he ventured to com- pare bank notes to assignats, he was called to order. He was called to order for speaking irreverently of those notes, which were by law rendered not pay- able agreeably to promise, and which law it was now proposed to continue. Now we come to the Minister Addington's rea- sons for continuing this Act after the end of the war ; and to those reasons we must pay particular attention. He prefaced his proposition, as his pre- decessors always used to do, by very high language about the ability of the Bank to pay in coin. He said, in the debate of the 9th of April, " I have the satisfaction of being convinced, that the measure cannot furnish a pretence to the most timid man in the House, to suppose the Bank does not possess within itself the most ample means of satisfying the full extent of the demands which may be made upon it, by the payment of its notes in specie." In the debate of the 2 1st of April, he said, that" on the solidity of the Bank, he was entitled to say and as- sume there was now no question either in that House or elsewhere. On the DISPOSITION of the Bank to make payments in specie, he was also entitled to assume, nay, he owed it to the Bank to ASSERT they had manifested a readiness to do so. It " was, however, thought necessary to continue this restric- tion for a while." Having said this, he said, that it was, of course, quite unnecessary to enter into any inquiry as to the state of the Bank's affairs ; and, accordingly, it only remained for him to state the grounds, upon which he proposed the continua- tion of the measure. But, Gentlemen, pray bear in mind, that this Minister gave the country to under- PAPER AGAINST GOLD. 267 stand, that the Bank Company had, even at that time, u manifested a readiness to make payment in specie" and this was now nearly nine years ago. Yet, Mr. RANDALL JACKSON now bestows something very much like abuse upon the Bullion Committee, because they recommended to the House to make the Bank Company begin to pay in specie in two years from this time. What should make the Bank Com- pany angry with the Committee, if it was true, that they wished to pay in money, so long as eight years and nine months ago ? The grounds which the Minister, ADDINGTON, stated for the continuation, were as follows. In the debate of the 9th of April, he said; " The grounds on which I shall rest the proposition I have to make to the House, are notorious ; and it will be for the sober and dispassionate reflection of the House, whe- ther the measure I shall submit does not necessarily result from facts and circumstances too well known even to require a particular statement of them. It cannot be necessary for me to inform the House, that the rate of exchange between this country and foreign parts is disadvantageous, to ourselves. . . . It cannot be necessary for me to prove, that while the rate of exchange is disadvantageous to us, an augmentation of the circulating cash would create a trade highly injurious to the interest and com- merce of this country. It is well known, that for several months past there has been a trade carrying on in purchasing guineas with a view to the ex- portation of them In addition to these reasons, the House will reflect upon the inconve- nience which would unavoidably result from letting loose such a proportion of the coin of the country as would be circulated by taking off the restriction. I am not aware of any inconvenience, that can possi- bly arise from continuing it. We have had the sa- tisfaction, arising from the experience of three or four years of difficulty. We have had experience, that during such period, the credit of the Bank has 268 PAPER AGAINST GOLD. undergone no diminution whatever. Bank notes have maintained their reputation, and have been every where received cheerfully and readily. . . . Some Gentlemen are desirous that the Bank should pay in cash for notes of small denomination; but till there is a full and abundant supply of cash by opening the Bank entirely, it is extremely conve- nient to afford circulation to II. and 21. notes. By the payment of them in specie, a general anxiety would be introduced of obtaining cash at the Bank. Notes of 1,000/. and 500Z. would be changed for notes of II. and 21. in order that they might be immediately changed again for cash. If a re- straint was to be imposed with respect to the num- ber of notes of small denomination, they would be driven out of circulation altogether; and there would be no small notes but those issued by Bankers." There, Gentlemen, you have now before you the reasons why this Act was continued after the war. The Minister, Mr. PITT, told the nation, that it was necessary during the war, in order to prevent the enemy from executing his vow of destroying our credit ; and the Minister, Addington, told the nation, that it was necessary after the war was over, be- cause the rate of exchange was against us, because people were exporting guineas when they could lay hold of them, because to repeal the Act would let coin loose, because the experience of years had shown that the stoppage of cash payments had done no harm to the credit of the Bank, whose notes were every where received cheerfully and readily, and finally, because, (pray mark !) if a part of the notes were to be paid in specie, that would give rise to a general anxiety to obtain cash at the Bank, and that people would change large notes into small ones, in order immediately to change these latter for cash. So, then, Mr. ADDINGTON, the people did, even in your time, like gold better than the notes ? Though you could not perceive, not you, any inconvenience from the continuation of the Act ; though you had PAPER AGAINST GOLD. 269 seen with satisfaction the experience of the years of suspension ; though the credit of the Bank had un- dergone TIO diminution whatever ; though the Bank notes had maintained their reputation and had been every where received cheerfully and readily ; yet, notwithstanding all this, you object to make the small notes payable in gold, lest the holders of them should run to the Bank and get cash for them ; lest this taste for the sweets of gold should excite a ge- neral anxiety of obtaining cash at the Bank ; and lest large notes should be changed into small ones for the purpose of again changing these latter into cash. But why was this to be feared? The Bank Directors, were surely, the best judges of this ; and, you say, not only that they are able to pay ; but they have manifested a readiness to pay their notes in specie. Now, this being the case, what danger was there of a run upon the Bank ; and, if there had been a run, what danger was there in that ; seeing that there were means amply sufficient to meet such run ? Mr. ROBSON, whom we have seen called to order for speaking so irreverently of Bank notes, opposed the bill in its subsequent stages : he pointed out the advantages which the Bank derived from the Act ; he foretold what the Bullion Committee have now declared to have come to pass ; in short, he did all that it was in his power to do to prevent the conti- nuation of a measure, which a Committee of that same House of Commons have now declared to have produced such fearful consequences ; and this Mr. ROBSON did, while Mr. HUSKISSON, who now tell us that no one foresaw the evil, not only suf- fered the measure to pass in silence, but was one of the majority of the Minister by whom the measure was proposed and put in execution. Well, but, after all, the Act was to last only ten months ; only till the first of March, 1803 ; it was only, as the Minister's brother, Mr. HILEY ADDING- TON, called it, " a temporary provision, till the ef- fects of the peace should have begun to operate." 23* 270 PAPER AGAINST GOLD. Only this. Nothing more. Yet did they, when the 1st of * March, 1803, came, renew the Act again. Again did they pass a law to protect the able-and- W-illing-to-pay Bank against the demands of the note-holders ! Again did they pass an Act, to con- tinue in force till six weeks after the commencement of the then next session of Parliament, the measure for preventing payments in cash, though peace had been made a whole year, and though they said, that the Bank was able and ready to pay. Let us see, then, Gentlemen, what were the rea- sons given now. " The most thinking people in the world," were, as we have seen, told the last time, that the Act of renewal was " a temporary provi- sion^ till the effects of peace should have begun to operate ;" and, as peace had now lasted a whole year, what reason, what pretence, what excuse, what apology was now to be found ? This is what we ought to keep our eye upon. We know well, that they renewed the Act ; but, in order to be able to judge of what will be done in future, we must take care to keep in view the reasons, which, at the dif- ferent renewals, were given for the measure. When he came to propose the second renewal af- ter the war was over, it must be confessed, that Mr. ADDINGTON did appear to perceive the light in which he stood. He did appear sensible of his situation ; and, doubtless, this was amongst the things, for which, as it was asserted by a pamphleteer soon af- terwards, Mr. PITT was under obligations to his successor. It was on the 7th of February, 1803, that he moved for leave to bring in this bill. He began by saying, "that it was with the utmost reluc- tance that he submitted the proposition to the House, but the reasons which suggested it were too strong, and the necessity too urgent, to be resisted ; that necessity, however, he hoped would soon disappear; and he anxiously and impatiently looked forward to the day, which he trusted was not far removed, when the Bank would be at liberty to resume its PAPER AGAINST GOLD. 271 payments in specie." The grounds for proposing this measure he stated to be, that the course of ex- change was still against this country ; and, as the House " last year, considered that a sufficient argu- ment for the measure, he would appeal to the can- dour and good sense of the House whether it would be expedient to allow the restriction to cease." He also said, "that a sudden issue of cash from the Bank would produce a run upon the country banks, and a consequent run upon the Bank of England, which might be productive of most serious conse- quences." He further observed, " that the exchange being against us, had arisen from the circumstance of scarcity of coin, which of late years had caused so much Bullion to be sent out of the country, and that it was obvious, that we should wait the opera- tions of a flourishing commerce to bring back some proportion of this vast amount of Bullion, before we attempted to permit the Barfk to issue specie." The whole world never, in my opinion, heard, any thing like this before. Were it not upon record, in a manner not to be disputed, it would not. it could not, be believed. Mr. TIERNEY and Mr. Fox spoke against the motion, and particularly wished for an inquiry, previous to the passing of such a bill. Mr. Tierney said, "according to the report of the Com- mittee of 1797, the proportion of cash and bullion in the Bank amounted tv ONE MILLION, when the Order of Council was issued ; and some short time afterwards this sum was increased to SIX MILLIONS. Was it not now a fit object of in- quiry ; What had become of their six millions ? If it was forthcoming to meet any exigency ; and if it was, why should the Bank hesitate to resume their operations ? They could not be afraid of a run upon them, for who could now think of any mate- rial advantage from hoarding gold ?" Nevertheless, the bill passed ; and thus was the Bank protected against demands upon them for cash, until six weeks after the commencement of the then next 272 PAPER AGAINST GOLD. Session of Parliament, which Session began in No- vember, 1803.* After what we have now seen, we can hardly ex- pect to hear of any more reasons. It would, I think, have been utterly impossible to invent any pretext that Mr. ADDINGTON would have made use of; but, most fortunately for him, before Parliament met, and, of course, before the Act expired, WAR had begun again. That was quite enough ; and, without any scruple, hesitation, or ceremony, the Minister brought in a bill to prolong the Stoppage, or Restriction, till the war should be over, and until six months after a definitive treaty of peace should be concluded. He said that, " though doubts had been entertained as to the propriety of the measure, during a period of peace. Under the impression, therefore, that no doubts existed on the subject, he should take it for granted, that not objection would be made, in the present instance, to a renewal of the measure. It was satisfactory to know that the credit of the Bank had remained firm and unshaken, during the past experience of the measure, and that its sufficiency to make good its engagements, both was, and is, unaffected by even the slightest suspicion"] This was all. There was very little more said about the matter. All the anxiety that he expressed upon the former occasion, for the happy day of cash- payments to come, was now forgotten ; or he had got an entirely new view of the matter. There were some very interesting debates upon the subject, in the House of Lords, in which LORD KING and LORD GRENVILLE took a part, and in which they showed, that they were duly impressed with the dangerous consequences of continuing this Act in * The whole of this debate is very important, and als,o a subsequent one of the llth of February, 1803. They will be found at full length, and very accurately given, in the POLI- TICAL REGISTER, Vol. III. pages 1243 and 1347. t See Parliamentary Debates, Vol. I., page 52. Where the reader will find Mr. ADDINGTON'S grave ideas respecting hoarding money. PAPER AGAINST GOLD. 273 force ;* but, what they said was of no avail. The Act was passed ; it is, as you well know. Gentlemen, in force to this day ; and the proposition of the Bul- lion Committee is, that it shall be in force, to its present extent, at least, only two years longer. When we take a review of the reasons for the passing of this Act, at the several times at which it has been passed ; when we see how those reasons have varied; when we see how many times the expectation of a return to cash-payments has been disappointed ; but, especially when we look well into the part which the Bank Company themselves have borne in these transactions ; when we look at what passed between the Minister and the Bank Company previous to the Stoppage ; when we look behind the curtain and see the plan laid for a pri- vate Meeting of the principal Bankers to settle upon the scheme for a general meeting ; when we after- wards hear the Minister, in Parliament, talking of that Meeting as of a thing in which he had nothing to do, and citing it as a mark of the public confi- dence in the Bank Paper ; when we take this view, Gentlemen, it is not, I think, possible, that any of us can ever again be deceived by professions, pro- mises, and outward appearance, as far, at least, as relates to the subject of bank notes. I have now gone through the whole history of the Stoppage of money-payments at the Bank of Eng- land, which history, though it has, Gentlemen, taken up a good deal of time, will, I trust, be found well worthy both of our time and our labour. Without a knowledge of this history, it is impossible for any one to form so correct an opinion, as to the future, as he will be able to do with this history, fairly im- printed on his mind. In this history he has before * See Parliamentary Debates, Vol. I., page 152 to 156. And page 304 to 319. These two debates are of great importance. There is scarcely any thing to be found in the Bullion Report, as touching the main points, which will not be found to have been said, upon this occasion, by one or the other of these two Noblemen. 274 PAPER AGAINST GOLD. him the experience of thirteen years ; and, from what has been, he will easily form his opinion as to what, under the operation of similar circumstances, is likely to be. We have, by toiling through this history, furnished ourselves with all the knowledge (of any real use here) possessed by the members of the Bullion Committee ; and, perhaps, a little more ; so that, we shall now enter into an examination of their production without any dread of difficulty in the progress, or of error in the conclusion. I am, Gentlemen, Your faithful friend, WM. COBBETT. State Prison, Newgate, Monday, Wth December, 1810. LETTER XXI. Appointment of the Bullion Committee Quantity of Bank Notes, compared with the quantity of Real Money Amount of Bank of England Notes in 1797, and at this Time Num- ber of Country Banks Probable Amount of their Notes- Amount of Real Money in the Bank of England Probable Amount of Real Money in the Hands of the Country Bankers. GENTLEMEN, WE have now arrived at a point whence we can see to the end of our discussion. We have seen how the Bank and the Stocks and the bank notes arose ; we have seen that they all grew up with the Nation- al Debt and the Taxes ; we have seen, that, at last, the bank notes became so large in amount that they could no longer be paid in money at the Bank Shop in Threadneedle Street; we have seen the means that have, in the several stages, been resorted to,, in order to protect the Bank Company against the de- mands of its creditors, the holders of its notes ; and we have a pretty fair view of the conduct of all the parties concerned in these transactions. With the PAPER AGAINST GOLD. 275 EVIL and with the causes of the Evil we are now well acquainted : it only remains for us to obtain as good information with respect to a REMEDY. To discover and point out a REMEDY were the ob- jects of the BULLION COMMITTEE, of whom I must speak here a little more fully than I hitherto have done. This Committee, consisting of twenty- one members, was, as I stated in Letter I, appointed by the House of Commons, during the last Session of Parliament " to inquire into the cause of the high price of Gold Bullion, and to take into considera- tion the state of the circulating medium, &c. &c. and to report the same to the House." They did so ; and their Report was, by the House of Commons, ordered to be printed on the 8th of June last. This Report, after showing that the bank notes have depreciated ; after giving very clear proofs of this fact, and also of the fact that the depreciation must continue to increase, unless put a stop to by some means or other ; after this, the Report recom- mends, as a remedy, that the Bank Company shall be, by law, compelled to pay their notes in cash, as formerly, in two years from this time ; and, there- fore, the only great object which remains for our con- sideration, is, whether this proposed remedy be prac- ticable, or, whether it be one that cannot be put in practice. In order to arrive at a correct conclusion as to this great question, upon which, as you must already have perceived, the very existence, not only of the paper-money system, but also of the Stocks or Funds, entirely depends, we must, 1st. take a view of the Quantity of paper-money now afloat, compared with the quantity of real money and bullion in the hands of the Bank Company and in those of the Country Bankers ; 2d. we must inquire into the rate of the depreciation of the paper-money ; 3d. we must in- quire into the m.eans which the Bank Company would have of obtaining real money, wherewith to redeem, or pay off, their notes, or any considerable 276 PAPER A&AINST GOLD. part of them, and, if we shall find, that for them to do this would be impossible, our conclusion must be, that the Bank Company cannot return to their pay- ments in gold and silver. The discussion of these matters I shall divide into three Letters, in this first of which I shall take a view of the quantity of paper-money now afloat, compared with the quantity of real money in the hands of the Bank Company and in those of the Country Bankers. The amount of Bank of England notes in circu- lation before the Stoppage of payments in Gold and Silver, in the year 1797, was, as the Committee state, between 10 and 11 millions of pounds. But, as it was natural to expect, when the Bank Company was protected by Act of Parliament against the demands of their creditors, they immediately began to increase the quantity of their notes ; and let me ask, what lo- ver of gain would not do the same ? Where shall we find a private person of that description, who would not increase the issues of his promissory notes as long as any one would take them, if there were an Act of Parliament to protect him against the de- mands of the holders of those promissory notes ? That the consequence, which was naturally to be expected, did take place, was very well known, and had been clearly shown in the Register, and much commented upon therein, long before, several years before the Bullion Committee existed, the readers of the Register need not be told. But, the Bullion Committee have verified the facts and opinions gi- ven, in this respect, in the Register ; they have pub- lished to the world, through the channel of the House of Commons, that, what had been before published in the Register, relating to this matter, was sound and true. They state, with regard to the amount of the Bank of England notes, that, previous to the Stoppage of cash payments, in 1797, and the consequent Act of protection to the Bank, the amount of these notes PAPER AGAINST GOLD. 277 " was between TEN and ELEVEN millions, hardly ever falling below NINE, and not often exceeding ELEVEN ;" and that in May, 1810, the amount was upwards of TWENTY-ONE millions. Gentlemen, you, who have so recently felt the ef- fects of a paper-money, not convertible into gold and silver, look at this. You see, that the amount of the Bank of England notes has been doubled in the course of thirteen years, even according to the account given in by the Bank Company themselves. It is not my intention to insinuate, that this account is not a true one ; but, it is right that we should know, that this statement has been made by the Bullion Committee, from an account made out and presented to the Com- mittee by the Bank Company themselves ; and that, therefore, we may rest perfectly satisfied, that the amount of the increase in their notes has not been, stated too high. But, as yet, we have seen only one limb, and per- haps the least fruitful, of this paper-money tree. The other, the Country Banks, has been, according to all appearance, much more prolific. It appears from the Report, that before the Stoppage or Restriction law was passed, there were TWO HUNDRED AND THIRTY Country Banks, and that, in April last, they had increased to SEVEN HUNDRED AND TWENTY-ONE ; which is an increase more than threefold as to the number of Banks, and, if we al- low, as it is reasonable to do, that the notes of the old banks also increased in quantity, the addition in the whole amount must have been prodigious. No wonder that gold and crown-pieces disappeared ; for how were they to be expected to remain in circula- tion along with such masses of paper ? As to the amount of the Country Notes at either of the periods before-mentioned*, or at any period at all, therBullion Committee say, that they are unable to ascertain it with any degree of precision ; but from certain returns obtained by them from the stamp office, they show, that, after making all allowances, 24 278 PAPER AGAINST GOLD. and taking the matter m the most favourable point of view, there was, during the year 1809, in the Jive and ten pound notes alone, an INCREASE to the amount of more than THREE MILLIONS ; and, from the other notes which appear to have been stamped in that year, there could not be an increase of less than TWO MILLIONS more in the Country notes for other sums. In that same year there was an increase of a MILLION AND A HALF in the amount of the Bank of England notes ; so that, in the year 1809, the total amount of the increase of the notes of all sorts could not be less than six mil- lions and a half. And yet " the most thinking peo- ple" seem to be quite astonished, that they no longer see any guineas ; that guineas are bought up and sent abroad ; and that people in trade purchase, at a premium, with bank notes, the things called shil- lings and sixpences, from the keepers of the Turn- pike Gates. The amount of the country notes, though it has not been ascertained by the Bullion Committee, and though they were unable to ascertain it, may be com- puted with a tolerable degree of accuracy, seeing that they have ascertained and stated, that there was in the five and ten pound notes alone, an increase to the amount of three millions of pounds in the year 1S09, and in the whole of the Bank of England notes to the amount of a million and a half; for, unless any one can see, which I cannot, any reason for a greater proportionate increase in the country bank paper than in the London Bank paper, the question is nothing more than a very plain one in the Rule of Three, (if one ought, in such a case, to be permitted to use the Golden Rule,) and which ques- tion would thus present itself; if 1,500,000, of in- crease require a total amount of issues of 21,249.980, what total amount of issues will be required by an in- crease of 3,095,340. The answer will be 43,000,000 and upwards. And if we make our computation upon the increase of 5,000,000, we shall find the whole PAPER AGAINST GOLD. 279 amount of Country bank notes, in 1809, to have been 70,000,000 and upwards, which, there being 721 Coun- try banks, is less than 100,000 for each ; and, it is well known, that many of them have half a million of notes out. Your great Bank, at Salisbury, had, I believe, notes out to the amount of 600,000 pounds. Now, I am not aware of any thing that can be said against this mode of computation. I am, for my own part, fully persuaded that it is fair, and, that the result of it is not very far from the truth. But, in order to leave no room for cavil, let us suppose the amount of the Country notes to be only one half what it is here computed at. Even in that case there must be now in circulation paper promises to the amount of 56 millions of pounds and upwards. This, then, is the sum against which we have to set the coin and bullion, the gold and silver in the hands of the London Bank Company, and in those of the Country Bankers. What is the exact amount of this no one can tell, but every one must suppose, that, comparatively, it is very small indeed; for if this had not been the case with regard to the Bank Company, even in 1797, why did they not state the amount of their real money ? Why were they so shy upon that score ? And, indeed, if their stock of real money had been very good indeed^ why did they apply to the Minister to know when he would inter- fere ? If they could have stood a run of a week, they would have needed no Act of Parliament to protect them against the demands of the note holders. But this they could not stand ; and there needs no other proof of the smallness of the quantity of their cash. In Letter XV, page 203, we have seen, that the whole amount of their Cash and Bullion and Bills discounted was only 4,176,080 pounds, on the 25th of February, 1797. As w r as there asked, who is to say how much of this consisted of Bills discounted? If more than half had consisted of cash and bullion, they would not have been jumbled together with 280 PAPER AGAINST GOLD. Bills discounted. Indeed, the cash, at that time, in possession of the Bank Company, was computed at 1,272,000 pounds, and, in a speech of Mr. TIERNEY, quoted in Letter XX., page 271, it is stated at 1,000,000 of pounds. There is no certainty in this, to be sure ; but, Gentlemen, we are quite certain of one thing, and that is, that when men, whether sin- gle, or in companies, have plenty of pecuniary means, they never are very cautious to disguise the fact. Is it probable then, that the quantity of cash in the hands of the London Bank Company has increased since 1797? Is it likely that, if they had but about a million before they were protected against the de- mands of the note-holders, they have increased the quantity since? Will " the most thinking" people believe this ? If they will, there is certainly no doubt but they are prepared for the verification of the old proverb about believing that the " moon is made cf green cheese." And, as to the Country Ban*s, to suppose that they contain any thing worthy of notice, in gold or bul- lion, would be too absurd to be treated seriously. The moon-raking adventure, which has been ascri- bed to a Wiitshireman, was thus applied by DEAN SWIFT at the memorable time of the South Sea Bub- He, when so many thousands and tens of thousands of families were ruined by jobbers and dealers in /unds and Stocks : One night a fool into a brook Thus from a hillock looking down, The Golden stars for guineas took, And Silver Cynthia for a crown. The point he could no longer doubt, He ran, he leap'd into the flood, There sprawl'd awhile, and scarce got out, All cover'd o'er with slime and mud. But, Gentlemen, foolish as our poor countryman was, in this case, he was not half so worthy of ridi- cule as we should be, if we, with all the informa- PAPER AGAINST GOLD. 281 tion we now possess, or have, at least, had the means of possessing, were still to believe, that Coun- try Bankers have, or ever will have, gold or silver sufficient to pay off a thousandth part of the notes that they have issued. After taking this view of the matter ; after com- paring the amount of the bank notes with the amount of the Cash and Bullion, in the hands of those by whom the notes have been issued, ought we to won- der, that those persons, and all their friends, depre- cate the notion of paying again in cash? You have seen, Gentlemen, in the course of these Letters, that the Bank Company have been represented, upon se- veral occasions, as being perfectly ready to pay again in cash, and that they have upon all occasions, been represented as able to pay again in cash. You have, all along, heard the Stoppage spoken of as a tem- porary measure ; as a measure to last only for a t\me ; the pretences were lame, to be sure, but still there were pretences. Now all this is thrown aside, and they say, in plain terms, that not to pay in cash is a very good permanent system. With such a mass of paper, and so little coin and bullion, it was not to be expected that the paper would not depreciate or fall in value: but, as I wish to make this depreciation the subject of a separate Letter, I shall here conclude, by subscribing myself Your faithful friend, WM. COBBETT. State Prison, Newgate, Monday, December 17th, 1810. LETTER XXII. * Legal Tenders have been the cause of the overthrow of every financial system into which they have been introduced." Essay on American Pu- rer-money- 24* 282 PAPER AGAINST GOLD. The Question of Legal Tender in Bank of England Notes- Two Letters received from Correspondents as to the true Constitution and Practice of the Act of 1797 How far the Bank of England Notes are a Legal Tender They are so far as relates to Debts due from the Bank of England inclu- ding the Dividends Not so with regard to Debts and Contracts between man and man Any holder of a Coun- try Bank Note may compel the Payment of it in the Coin of the Kingdom This proved by the Decision in the Case of Grigby against Oakes The opinions of the four Judges in that Case The Justice of this Decision The Reason why People have not hitherto compelled the Country Bank- ers to pay their Notes in Coin. GENTLEMEN, THE proposed subject of this Letter was an in- quiry into the rate of the depreciation of paper- money / but two letters, which I have received, in the last six days, the one from Glasgow, and the other from the neighbourhood of Exeter, induce me to devote this present Letter to the answering of them, they being upon the very important subject of the legal tender. The writer of the first letter expresses his doubts as to the correctness of my exposition of the Bank Stoppage, or Restriction Act, (See Letter XVI., page 210,) and his wishes that I would give him my opinion again, after having taken time to revise what I before said upon this part of the subject. My cor- respondent near Exeter, who tells me that he is a farmer, thanks me for the useful information that he is so good as to say he has received from this se- ries of Letters, and begs me, in a very earnest man- ner, to tell him, whether I am quite sure, that I was correct, when I said, that any holder of country bank notes might compel the payment of them in gold and silver. Both these gentlemen have put their names to their letters ; but, as the same doubts and uncertainties may have occurred to others of my readers, I shall give my answer in this public man- ner, and, after having done so, there will, I trust, remain no doubt or uncertainty at all. I stated to you, Gentlemen, in Letter XVI., that, PAPER AGAINST GOLD. 283 as far as related to debts due from the Bank of Eng- land, the notes of that Bank were, by the Act of 1797, called the Bank Stoppage or Restriction Act, made a legal tender ; that is to say, that the credi- tor was compelled to take those notes in payment, or to go without any payment at all. If, for instance, any one of you has a Bank of England note of ten pounds, and carry it to Threadneedle-street for pay- ment, the Bank Company may compel you to take other of their notes in payment, or they may, if you refuse such notes in payment, refuse you payment in any thing else. It is the same with regard to the payment of the dividends) that is to say, the interest of the Stocks or Funds. If, for instance, our neighbour, GRIZZLE GREENHORN, when she goes to receive her half-year's interest upon her Stock, which, you know, is paid her by the Bank Company, were to say : " pay me in good gold and silver," she would, or might, re- ceive for answer, an assertion, that the law, the Act of 1797, protected the Bank Company against such an unreasonable demand. In a word, the Bank Company might refuse, absolutely refuse to pay her her interest in any thing but their own promissory notes ; and then, if she tendered them those promis- sory notes for payment, they might refuse to pay them in any thing but other of their own notes ; that is to say, they would be ready to give her fresh promises to pay in lieu of the promises to pay which they had given her before ; but, she could not compel them to give her one shilling's worth of gold or silver, except there might be due to her, in the way of interest, any fractional part of a pound. Thus far, then, the Bank Company's notes are a legal tender. And, in the affairs between man and man, if such notes be once accepted and received in payment of any debt whatever, they are, after such acceptance and receipt, to be considered as a legal payment in that case. If, for instance, I owe my neighbour a hundred pounds, and tender him 284 PAPER AGAINST GOLD. Bank of England notes in payment, and he receive them in payment to the amount of the sum due to him, he is paid, I am acquitted of my deht ; he can- not afterwards sue me for the debt, upon the ground that I have not paid him money, as he might do in the case of other promissory notes, if there were no particular agreement to bar him. But here the legal tender of Bank of England notes stops. They are not yet, in any other case, put upon a footing with money. As to all the trans- actions between man and man, except in the above circumstances, which can occur only where the Bank of England itself is a party, no person is obliged to take Bank of England notes in payment of any debt, or legal demand. And this is a thing well Worthy of the attention of all those, who have it in contemplation to enter into contracts which are to have a future operation; for if the value of gold and silver, compared with that of bank notes, should continue to increase, those who now make contracts for payments to be made some years hence, should bear it constantly in mind, that the party to whom they will have to make such payment, will, at all times, have it in his power to insist upon gold coin in payment. If this be the law, without any other exceptions than those above named, it follows, of course, that I can have not the least hesitation in telling my De- vonshire correspondent, that I am quite sure, that any holder of a Country bank note has it, at all times, in his power to compel the payment of it in gold or silver coin from the King^s mint, and of full weight and due fineness. I know that a differ- ent notion has prevailed ; and I have heard it said, or seen it stated in print, that this compulsion cannot be effected ; because, it has been said, if you were to bring your action of debt against Paperkite and Co., they would pay the amount into Court in Bank of England notes ; and that, upon proof of their having done this being produced, the Court would PAPER AGAINST GOLD. 285 stop the proceedings, or, at least, throw all the costs thereafter incurred upon you. This would, indeed, make the Bank of England notes a legal tender in fact, though not in law ; or, in other words, it would make an Act of Parliament a mere delusion, a shuffle, a cheat, a base premedi- tated fraud. But this is all a mistake ; it is not founded in fact ; the Courts would attempt to do no such thing ; for, if one could, in any case, suppose the inclination to exist, in the mind of a Judge, he would not do it, or think of it, in the face of what has already been done. The question has been decided, and that, too, with all possible solemnity, as will appear from the case which I am now about to lay before you, and the pe- rusal of which will remove all d.oubts whatever upon the subject. There appears to have been no doubt about the letter of the law, in the mind of either of my correspondents ; but they both doubt of its inter- pretation in the Courts; and the last mentioned gentleman says, that, though upon the face of the Act, there is nothing to warrant the supposition, that a holder of a Country bank note could not compel the payment of it in gold and silver, yet he thinks, that such holder would, by the judicial construction, of the Act, be defeated in any attempt to compel such payment ; and, he seems to think, that this is pretty clearly demonstrated, in the fact, (as he sup- poses it to be,) that no one has ever yet attempted to compel Country Bankers to pay their notes in gold and silver. He will, doubtless, be surprised to find, that the attempt has not only been made but that it fully succeeded. In the year 1801, four years after the Bank Stoppage, or Restriction Act was passed, a Mr. GRIGBY, in the county of Suffolk, went to the Bank Shop of Messrs. OAKES and Co. of St. Ed- mund's Bury, and in presenting them one of their own Five Guinea notes for payment, demanded money. The Bankers tendered him a Jive pound 286 PAPER AGAINST GOLD. Bank of England note, and Jive shillings, which he refused to receive, saying, that the five pound Bank of England note was not money, and that he would not take it. The Bankers told him, that if he wanted specie for his accommodation, they would let him have it. He declined to receive it in that way ; he said that he stood in no need of it as an accommo- dation; that he demanded it as a right; and that, unless they paid him in the com of the kingdom, he would bring an action, of debt against them. Upon this ground they refused him payment in coin, where- upon he brought his action and obtained a verdict in his favour at the Assizes ; but the question of law was, upon the motion of the Defendants' counsel, re- served for decision by the Judges ; and the follow- ing is the Report of the Case, as argued before, and determined by the four Judges, of the COURT OF COM- MON PLEAS, on the 19th of November, 1801. GRIGBY against OAKES and another " This was an action on a promissory note ; the Defendants as to all but five guineas pleaded non assumps erunt, and as to the remaining five guineas, they pleaded a tender. The cause came on to be tried at the Sum- mer Assizes for Suffolk, before Mr. Baron Hotham, when a verdict was found for the Plaintiff, with one shilling damages, subject to the opinion of the Court upon the following case. The Defendants are Bankers at Bury St. Edmund's, and issued the note in question for five guineas, payable on demand to the bearer. On the 31st of January last, the Plain- tiff carried several notes to the shop of the Defendant, and demanded payment. He first presented other notes, to the amount of fifty guineas, for which he received payment, partly in Bank of England notes and partly in cash, the cash being ten pounds, and being the proportion of money they usually Day. He then presented the note in question, for which the Defendants tendered in payment a five pound Bank of England note and five shillings in silver. This the Plaintiff refused, on the ground that the PAPER AGAINST GOLD. 287 tender was partly in a Bank of England note, ob- jecting to such note, and insisted on being paid wholly in money. The Plaintiff* did not at the time say he wanted money for his own particular accom- modation, but stated that he came on purpose to have cash for the note, or to bring an action if payment in money was refused. " The question for the opinion of the Court was, Whether, under the circumstances before stated, the Plaintiff was entitled to recover? " Serjeant SHEPHERD, for the Defendants, urged, that though unquestionably previous to the passing of the 37 Geo, 3. c. 45, commonly called the Bank Act, a bank note would not have been a legal tender, yet that, since the passing of the above Act, such notes must be considered as cash, for that the neces- sary consequence of the above Act being to absorb a vast proportion of the actual cash of the country, the Legislature must have intended to give a new character to Bank notes by way of substitute ; that they had specifically declared them to be a good tender so as to prevent an arrest, and yet if the same spirit which actuated the present Plaintiff in the com- mencement of this action was to continue to influence his conduct, and that of others also, a Defendant, though exempted from arrest, might ultimately be taken in execution, though ready to pay in bank notes, since he might possibly be unable to satisfy the judgment obtained against him altogether in money : because even if a sale of his goods took place, the Sheriff might not be able to avoid receiv- ing a large proportion of bank notes from the pur- chasers; that, indeed, in some respects, bank notes were privileged by the 37 Geo. 3. c. 45, beyond cash, inasmuch as a tender of them in satisfaction of a debt operated to discharge a party from arrest, which was not the ease with a tender of money, which must be pleaded in bar ; and that no contrary infer- ence could be drawn from the 8th section of the Act, which declared payments in bank notes to be 288 PAPER AGAINST GOLD. equivalent to payments in cash, if made and ac- cepted as such, because that must have been the case before the passing of the Act, and therefore that clause must be deemed nugatory. " Serjeant SELLON, on the other side, was slopped by the Court. "LORD ALVANLEY, (Chief Justice.) The ques- tion for the Court to decide is a mere question of law, arising, as it has been contended, out of the pro- visions of the 37 Geo. 3. c. 45. In fact we are called upon to say whether it follows as a necessary con- sequence from that Act, that a tender in bank notes is equivalent to a tender in money ? It may be very true that individuals may be occasionally subjected to great inconveniences from the operation of that Act ; but are we therefore to say that the Legisla- ture has enacted that which the provisions of the Act do not warrant ? If we were at liberty to refer to our own private knowledge of the language that was held in Parliament while this Act was pending, no doubt could be entertained upon the subject. We know that it was very much canvassed at that time, Whether or not the Legislature ought to go the length of declaring bank notes a good legal ten- der ? If, therefore, it had been intended by the Le- gislature so to make them, that intention would have been expressed in such clear terms that no question could have have arisen upon the subject. Indeed, it is expressly provided, in the 2nd section of the Act, that if the Governor and Company of the Bank of England shall be sued on any of their notes, or for any sum of money, payment of which in their notes the party suing refuses to accept, they may ap- ply to the Court in which such proceedings are in- stituted, to stay proceedings during such time as they are restricted from paying in cash. But with respect to individuals it was not intended to prevent any creditor, who should be so disposed, from captiously demanding a payment in money, though such a cre- ditor is deprived of the benefit of arresting his debtor PAPER AGAINST GOLD. 289 Thank God, few such creditors as the present Plain- tiff have been found since the passing of the Act ! But yet, whatever inconveniences may arise, and to whatever length they may go, Parliament, and not this Court, must be applied to for a remedy. Incon- venience arising from the operation of an Act of Parliament, can be no ground of argument in a Court of Law; and even if it were, still I should entertain no doubt, that it was the intention of the Legislature to make bank notes a legal payment only in certain cases by them expressed, and that in all other cases they should remain upon the same footing upon which they stood before the Act, ex- cept as to the exemption from arrest, which they af- ford to the party tendering them in payment. The 8th section of the Act, which has been treated as nugatory in the argument, however it may enact nothing new, still appears to me pregnant with the intentions of Parliament, and to speak loudly the re- solution not to alter the character of bank notes, but in those cases which are specially provided for. Without, however, referring to any of those specific clauses, and arguing from them as to the intent of the Legislature, I should be clearly of opinion, that the present Plaintiff is entitled to our judgment in his favour. " Judge HEATH. I am of the same opinion. The question for us to decide is, whether a tender in bank notes is a good legal tender. Now the 37 Geo. 3. c. 45, appears to me to negative that question ; for the several provisions of the Act making them a good and legal tender in certain excepted cases, excludes the idea of their being so generally in cases not pro- vided for by the Act. It has been argued, however, that the operation of the Act will in many cases be very injurious, unless we determine it to be a neces- sary inference from the Act that bank notes were intended by the Legislature to be put upon the same footing as cash. But whatever inconveniences may arise, the Courts of Law cannot apply a remedy. 25 290 PAPER AGAINST GOLD. I think, irrdeed, the Legislature acted wisely, having the recent example of France before their eyes, to avoid making bank notes a legal tender; for in France we know that legislative provisions of that kind in favour of paper currency only tended to depreciate the paper it was designed to protect, and were ulti- mately repealed, as injurious in their nature. " Judge ROOKE. I am of the same opinion. " Judge CHAMBRE. This case appears to me almost too plain for argument. It has been thought that the Courts went a great way in holding a tender in bank notes to be a good tender, if not objected to at the time. Certainly that was an innovation ; though perhaps a beneficial one. But the Act upon which the present question arises aifords nothing but argu- ments against the inference attempted to be drawn by it. Surely the observation that in some respects the Legislature have put bank notes on a more fa- vourable footing than cash, leads to a conclusion di- rectly contrary to that which it was intended to sup- port. If the Legislature have not gone far enough, it is for them, not for us, to remedy the defect. In- deed, by making bank notes' a good tender in cer- tain cases, specifically provided for, they appear to me to have negatived the construction we are now desired to put upon the Act." It will hardly be doubted, that I have copied this report with great care. I have, indeed, given every word of it ; but, for the satisfaction of my corres- pondents, to whom I am really obliged for their in- quiries, I will add, that the report is taken from a well known law-book, entitled, " Bosanquet's and Puller's Reports of Cases argued and determined in the Court of Common Pleas and Exchequer Cham- ber and in the House of Lords, from Michaelmas Term, in the 40th year of the reign of George III. (1799) to Michaelmas Term, in the 42nd Year of the same reign, ( 1801,) both inclusive." After reading this report, there cannot remain, in the mind of any man, the smallest doubt upon this PAPER AGAINST GOLD. 291 subject. Here is the fact, in practice as well as in theory, clearly established, that any holder of a Country bank note, payable to bearer on demand, or the holder of any such note, except of the Bank of England, may, at any time when he pleases, de- mand payment of such note in the gold and silver coin issued from the King's mint, that coin being of legal weight and fineness. And, if such payment be refused, upon demand, the holder of such note may immediately proceed to sue for such payment, which, if the party sued has the means, he must finally pay in coin, together with full costs of suit.* And, indeed, if this was not the law, the Bank of England notes would be a legal tender to all in- tents and purposes ; for, the issuers of these notes being protected by law against the holders of them, the holder of a Country bank note would have no claim upon the Country Banker, or upon any body else, for coin. The man who chooses to take a Bank of England note, does it, knowing that he cannot force any one to pay him its nominal amount in coin ; and, therefore, if he choose to take it, he has no reason to complain. Persons who buy Stock, know that they are to be paid their interest in Bank of England notes ; and, therefore, they have no rea- son to complain. But, if either of you sell your corn, or your wool, and take a Country bank note for it, that is to say, the .promissory note of your neighbour, you expect to have the real worth of your corn, or your wool ; and, of course, you expect to be paid by your neighbour in the real money of the kingdom, which money, as I have now shown you, you have a legal, as well as a moral right, to de- mand. * The shilling damages, mentioned in the first part of the above Report, is merely the nominal damages, which it is the custom to lay, in cases where the object, as in this case, is to ascertain me question of right. But, the Plaintiff' had his costs of suit in this case, as every other Plaintiff' must have, who brings an action in a similar way, and on similar grounds. 292 PAPER AGAINST GOLD. Lest any one should raise a doubt upon the cir- cumstance of Mr. GRIGBY'S demand having been founded upon a note given for guineas instead of pounds, I beg you to observe, that this circumstance was not even alluded to by either of the Judges, or by the Counsel who argued against Mr. GRIGBY. You will perceive, besides, that the Judges speak generally of all debts, except those only due from the Bank of England itself. The decision is founded upon the broad principle, that Bank of England notes may be refused in all cases, except only those where- in the Bank of England itself is the debtor, in- cluding the dividends upon the National Debt, and there the Bank is regarded as the debtor to the Stock- holder. It is also worthy of your observation, that, though the Chief Justice seemed to think, that it might be- come necessary to make the Bank of England notes a legal tender in all cases, another of the Judges expressed himself as decidedly of opinion, that such a measure would be both unjust and impolitic ; and indeed, that it would be, in part, at least, to imitate the measures of ROBESPIERRE, who compelled the people of France to take paper-money upon pain of death. If it should be asked, why other persons have not done as Mr. GRIGBY did, the answer is, that the peo- ple of this country, generally speaking, have really thought, that, by the Act of 1797, the Bank of Eng- land notes were made, to all intents and purposes, a legal tender, and of course, that if a man refused to take them in payment, he had not the means of for- cing the debtor to pay him in any other sort of thing. Nor is this generally prevailing error to be much wondered at seeing what were the means made use of at the time of the Bank Stoppage. When you .re- flect upon the famous meeting and resolutions at the Mansion House in London, the secret history of which I have given you. When you reflect upon the effect of these RESOLUTIONS, issued under the PAPER AGAINST GOLD. 293 signature of the LORD MAYOR ; followed, as they im- mediately were, by Resolutions of a similar purport, from the PRIVY COUNCIL, and from the Justices as- sembled in Quarter Sessions, in the several counties. When you reflect on the official manner, and the authoritative air of all these promulgations^ you will cease to wonder, that the Resolutions to take and pay the paper of the Bank of England were, hy the mass of the people, regarded as having the force of law. Now, however, you know the true value of those Resolutions ; you know what is, and what is not, the law relating to this important matter, in which every man of you is so deeply interested, and on your judgment and discretion with respect to which may depend the permanent welfare of yourselves and your families, to assist in the advancement of which welfare has always been, and always will be, a principal object of the labours of Your faithful Friend, WM. COBBETT. State Prison, Newgate, Monday, 2th Dec. 1810. LETTER XXIII. " It is in the last twenty years of the Funding System, that all the great shocks begin to operate." Paine. Events since the Date of the foregoing Letter Bank Notice about the Dollar Various Reports of the Effect of that Measure Proposals in Parliament respecting the Bullion Report. GENTLEMEN, IN reviving my correspondence with you, it will be necessary for me to revert for a moment to the point, at which I broke off, which was at Letter XXII., in which, as you will recollect, it was shown, 25 294 PAPER AGAINST GOLD. for the satisfaction of two correspondents in the country, that any man, having country bank notes in his possession, had (and he still has, of course) the power of compelling the drawer of such notes to pay t him in gold or silver, the lawful coin of the realm. But, that Letter was a digression from the main track of our subject, which, at the close of Letter XXL, was leading us into the great question as to the depreciation, that is to say, fall, of the Bank of England notes; a question which has caused more discussion than any other that has been agitated for many years past, and which, I think, we now look upon as completely decided, seeing that, while the dispute was going on, the Bank Company themselves have done an act which can, in the mind of no man out of a mad-house, leave the smallest doubt upon the subject. Nevertheless, as I wish that the series of letters should contain the whole of what I have thought, and still think, relating to this interesting matter ; I shall treat of the question here spoken of, after I have recorded the events, which have taken place since I last addressed you; and which events are important to a degree, that few persons, compara- tively speaking, appear to imagine. When, on the 24th of December, I wrote my last Letter to you, I did expect, that the winter would not pass over our heads without some striking change as to the circulating currency of the country. It ap- peared to me, as I had, upon former occasions, told my readers, quite impossible, that things could go on much longer without events that would strike the impudent partisans of the paper system dumb. The guinea had, for some time, been a marketable com- modity ; and under such circumstances, the paper will not continue much longer without being openly at a discount in all transactions. The coin of every denomination grew daily more and more scarce ; till at last, change for a pound note was with difficulty PAPER AGAINST GOLD. 295 obtained ; and, as these difficulties increased, people of course, felt an increased inclination to hoard "the' As a remedy for this evil, the Bank Company is- sued a Notice, raising the Dollar (which was in c r culauon at the rate of 6..) to 5.5. 6d. and it was after wards found, that this Notice had been issued wfth the advice and approbation of the PR.VY COUNCIL or at least, of a Committee of the Privy Counci an pointed to watch over the affairs of Coin. This No" tice, which was first published on the 18th of March to take ten shi lings worth or 15 shillings worth of halfpence in changing a poun d note, which half- pence were, for the most part, mere raps, not worth a tenth part of their nominal value Many of the shop-keepers in London, in order to tS^v th b i,r a ?- of ,K ca ^ on their wSrS! tied, by bills put in their windows, that thev would receive the Dollar, (the real value of which K2 than 4.. Qd.) at 5s. 9d. and some of them notified hat they would receive it at 6s. The same continues to be done now ; and that man must be blind, indeed who does not perceive, that two prices have to a certain extent, already taken place.^ ' * e inconvenience arising from the want of mo- ?hr y Ffe^T P Z Wnd H0te Was felt v y ^verely by the Bankers, whose customers, drawing upon them Suentlv" T 3 that , lhe yS^ 'happen To want C quently of course, drew for parts of a pound. These of Anril aV^ UDable to W5 and n the 9 h * April, a circular paragraph appeared in the e " ,d exhor !J Dg peopl to to,d pounds. On the same day it was stated, that in th shops, markets, and public offices, people gave I 296 PAPER AGAINST GOLD. ten acknowledgments for the parts of a pound, and left them thus unpaid. On the llth of April, Mr. MANNING, the Deputy Governor of the Bank, and who is also a Member of Parliament, informed the House, that the Bank were about to issue a large quantity of Dollars ; and he observed, that those persons who were hoarding them, in the expectation that they would rise in price, would he disappointed. Some days before this (on the 4th of April) the Bank thought it necessary to publish an advertise- ment, that the report of great quantities of their notes having been forged, and that the plates from which the said notes had been taken, had been stolen, was wholly false ; and, it seems, that this report was spread very widely through the country ; the object being to excite suspicion of the Bank of England notes, and thereby to insure a preference for the Country bank notes. On the 19th of April, it was stated in the public prints, that a person had a pro- missory note dishonoured because he could not pro- duce to the person, who had to receive the payment, the change of ISs. 3d. On the 23rd of April, a prisoner, confined for debt in the Marshalsea Prison, obtained his release, because his creditor, in paying him his maintenance money, gave him a piece of fo- reign coin instead of a sixpence. On the same day, it was stated in the public prints, that at some of the public offices, change was not only refused, but that certain of the Clerks in those offices, were dealers in the article, and supplied the bankers with silver at 3 per cent. On the same day, 23rd of April, JAMES KING, a Guard to a coach, was taken before the Lord Mayor, upon a charge of having bought guineas, and was held to bail. On the 26th of April, there was a paragraph, published in all the London daily prints, stating, that the Chinese had just discovered that gold and silver were too abundant with them, and, it was added, that they were going to send great quantities of it hither, some of which might be speedily expected. In the PAPER AGAINST GOLD. 297 public prints of the 27th, 29th, and 30th of April, it was stated, that ten thousand pounds in gold had been seized on board of a ship, about to carry it abroad. Many statements of this sort had appeared before, but this one was worthy of particular atten- tion. Also that a riot, attended with acts of vio- lence and killing, had taken place at Sampford, in consequence of the scarcity of change. A circular paragraph appeared at this time reprobating the prac- tice of hoarding, and hinting that it would be proper to punish it as a crime. At the same time ano- ther circular paragraph appeared, advising people not to hoard the change* for that a new silver coin- age was just coming out that would sink the value of the present coin. At the same time Mock bank notes were circulated from the King^s Bench and Fleet Prisons, by the means of which some unwary persons were cheated. An account of gold lawfully exported during one week, was published at this time, from which it was manifest, that the gold and silver were going to France and her dominions as fast as possible. It was now announced that the Bank had issued more Dollars, and that 300 worth had been sent to each of the Banking Houses in London. Such, Gentlemen, were the symptoms of the effect of raising the nominal value of the dollar ; and on the 8th of May, it was stated in the public prints, that another seizure of guineas had been made on board a ship sent into Dover. The words of the statement were these : " Four thousand and fifty more guineas have been found on board the ship sent into Dover last week. It is supposed she will be pulled to pieces, as her very iron ballast is hol- lowed to receive gold. She is called the New Union of London." They may pull her to pieces, and burn her; they may do what they like with her; but, Gentlemen, as long as this paper-money exists in England, the gold and silver will continue to go out of it in some way or other. The Government may 298 PAPER AGAINST GOLD. be ingenious, and we know it is able to employ great numbers of artful men ; but, all their art put together ; and all the powers of the government, not excepting the power of life and death, will never make gold and silver circulate at par with a depreciated paper. I have thus filled up the history of the time since I last addressed you. That time is hardly jive months, and yet, what events are here I What a change is here, in so short a space of time ! And, can you be made to believe, that the thing will stop where it is 1 Is it possible that you can be persuaded to believe, that the bank notes will now, or will ever, revive ? The grand effort now, with all those who wish to deceive the people, and to profit from their credulity, is to persuade them, that it is not the bank note that has fallen; but, the gold and silver that have risen. This seems to be the last trick in the budget ; but, what I have to say upon this head I must reserve till I come to my intended Letter upon the subject of de- preciation. In the mean while we must see what has been passing in Parliament, relating to this matter ; so that, before we proceed upon the remainder of our inquiries, we may have the whole history of the pa- per money before us, down to the very day when we shall come to our conclusion. In the foregoing Let- ters, there will be found, I am convinced, the most complete history of our Paper Money that has ever yet appeared in print. We have there traced it from its very outset to the day when the people of Salis- bury became, all in a moment, destitute of the means of getting a dinner. In this Letter its history has been brought down to last Saturday ; and all that we have now to do is to give, in as few words as possible, the history of the BULLION DEBATE, which, perhaps, would be unnecessary for our pre- sent purposes ; but, this is a subject, every fact 'be- longing to which ought to be so recorded, as to be capable of being hereafter referred to ; and ought, if possible, to be made known in every part of the world. PAPER AGAINST GOLD. 299 The Report of the Bullion Committee, which was printed last year, was laid before the House of Com- mons but a short time previous to its rising. It was ordered to be printed on the 8th of June, and I must say, that it gives me great pleasure to reflect, that it issued from the press on the very day that I was sent to jail! I shall always remember this with satisfac- tion. It will be a source of delight to me as long as I have breath in my body ; aye, and it will be borne in mind, too, long after the bank notes and all, yea all, that thereon depend, shall have come to their true level ; their proper state. The time being so short, the House could not take the Report into consideration, during the last Session ; therefore, this part of the business was to be performed during this Session. The Chairman of the Committee, Mr. FRANCIS HORNER, was to pro- pose some measure to be adopted in consequence of the Report ; but, he being a lawyer and a placeman at the same time ; having to go the Western circuit, and to manage the Nabob of Arcot's debts, he, of course, could hardly find time for this Bullion affair. After many appointments and disappointments, how- ever, he, at last, brought the matter forward on Mon- day last, the 6th instant, when a Debate ensued, which lasted during four successive nights; it being the custom in this Assembly to carry on the greater part of their works after it is dark. Previous, however, to this Debate, Mr. HORNER had laid upon the table of the House a string of PROPOSITIONS, expressive of his opinions as to the state of the coin and paper-money of the country, and also as to the remedy to be applied. In a few days after these had been before the House, Mr. NI- CHOLAS VANSITTART, who took the other side of the question, laid before the House a set of opposing PROPOSITIONS; which he soon afterwards followed by a set of Propositions being the former set amend- ed ; and these were followed by another paper from Mr. HORNER, containing Propositions in the form of 300 PAPER AGAINST GOLD. amendments upon his brother lawyer's Propositions, both of the gentlemen being " learned friends." The way being thus prepared, all the preliminary steps having been taken, the discussion was entered upon on the day before mentioned, at the end of one year, two months, and fourteen days from the time that the Committee commenced its labours. I have begun inserting this Debate, and I shall insert all the principal speeches before I have done ; and I do it, because I wish to afford all iny readers, and you, Gentlemen, in particular, an opportunity of perusing, at your leisure, what these persons have said upon this important subject ; and, besides, my wish is to place these speeches where they may be at all times conveniently referred to, seeing that my conviction is, that events are now hastening on apace ; events that will set all low cunning, all chicanery, all trick, at defiance ; and that, of course, will put the opi- nions contained in these speeches, to the test. My conviction is, that the time is not far distant, when it will be impossible to deceive the people of Eng- land ; when truth will reign ; and, at that time, it will be of great advantage for us to know what have been the opinions of men who have taken a part in these discussions, and to what point, whether good or evil, their endeavours have tended. What we have to discuss is the question of depre- ciation, or fall, in the value of the bank notes ; and, after that, the remedy proposed by Mr. HORNER and those who side with him. I shail, I trust, go to work in a way very different indeed from that of these gentlemen ; and, when I have written my opinion, there the matter will rest, and the truth of our seve- ral opinions will be tried by Time, which tries all things. I remain, Gentlemen, t Your Friend, WM. COBBETT. State Prison, Newgate, Friday, May 10^, 1811. PAPER AGAINST GOLD. 301 LETTER XXIV. Sauce for the Goose is sauce for the Gander." Old Proverb. Injury to Commerce by Buonaparte He is said to have caused the Gold to leave England. The fault is with our Government Our Appeals to the French People absurd- Forged Bank Notes sent into Kent from France Forged Assignats Decision in the Court of Kings Bench. GENTLEMEN, WE have now to discuss the question of Depre- ciation. We have now to inquire, whether the Bank of England notes have, or have not, depreci- ated ; that is to say, fallen in value. After what we have seen in the former Letters, and particularly in that immediately preceding, it is, indeed, nearly useless to put this question to any man of sense, and much more so to make it a subject of serious discus- sion. Nevertheless, it will be right so to do ; seeing that these Letters are intended to treat of every part of this great subject, and to put upon record all the material facts and arguments appertaining to it. In the House of Commons, during the Debate on the Bullion Report, and on the Resolutions thereon proposed, by Mr. FRANCIS HORNER on the one side, and Mr. NICHOLAS VANSITTART, on the other, it was contended by whose who were for Mr. VANSITTART, that is to say, by the MINISTRY and their adherents ; by this part of the House it was contended, that the Bank paper had not depreciated* or fallen in value ; and, being asked how they then accounted for the fact, that a guinea was worth 26s. or 27s., they answered, that it was very true, that Gold and Silver had risen ; but that the Bank paper had not fallen. They were then asked, how, since they would in- sist upon it that it was a rise of Gold and Silver, it had come to pass at this time above all others. Al- 26 302 PAPER AGAINST GOLD. lowing, for argument's sake, that it was a rise in the value of the guinea, they were asked how the value of the guinea came to rise. Their answer to this was, that it was owing chiefly to the injury done to our commerce by the extraordinary, the cruel, the savage measures of the inexorable tyrant, Buona- parte, whom they designated by every appellation characteristic of a despot, and even a fiend. Gentlemen, we will stop here and make a few ob- servations upon these charges against the Emperor of France ; for it would be very foolish in us, who call ourselves " the most thinking people in the world," to suffer ourselves to be amused with charges against Napoleon, when we should be considering of the real cause of the mischief that is now come upon us, and of the greater mischief that is still coming, and will come with most dreadful effect, unless we take timely measures for preventing that effect ; this would be selling ourselves to laughter in- deed, making ourselves an object for the contempt of Europe, not excepting the Dutch, and those other nations, whom, with empty insolence, our hireling writers and others affect to pity. We call upon the Bank for Gold and Silver in payment of their promissory notes. They have no Gold or Silver to give us ; or, at least, none do they give. They are protected by law against our de- mands. Some persons propose to remove this im- pediment to our demands. The men in power and a great majority of the House of Commons say no ; and they, in objecting to the proposition, say, that the Bank have not the gold and silver ; that they cannot get it ; and that it is, therefore, impossible to make them pay. This is a sorry answer enough ; but, when we complain, we are told, that the fault is not with the Government or with the Bank, an that it is wholly with Buonaparte, by the means of whose laws, edicts, and workings of one sort or another, the Gold and Silver have been drawn out of England. PAPER AGAINST GOLD. 303 What should we think, Gentlemen, what should we, " thinking people," think of a general, who was to write home word, that he had been beaten and routed, and lost half his army ; but that the fault was none of his, and that it was wholly the fault of the enemy's general, who had adopted against him a series of extraordinary, cruel, and sa- vage measures ? What would we, thinking people, say to such a general ? What should Mr. Q,UIN, the editor of the Traveller newspaper, in his sublime orations, in the Common Council, say to such a ge- neral ? Would he vote him thanks and a sword ? I do not say that he would not ; but I think, that you will agree with me, that such a general would, amongst most men, meet with but a cold reception ; and, that he would be told, that it was the business of the enemy to beat him, to rout him, to break him up, to ruin him ; and that it was his business to pre- vent the enemy from so doing, and also to beat, and break up, and ruin the enemy. Just such, must, if we have a grain of sense left, be our answer to the ministers and their adherents, when they blame Buonaparte for having deprived us of our Gold and Silver. It was their business to prevent him from doing us this mischief. It was their business to protect the country against the fa- tal effects of the enemy's measures ; and. if they found themselves unequal to the task, they should have said so ; and, I warrant them, there would not have been wanting others to take the labour off' their hands. These ministers and their predecessors, for the last twenty years, have had the complete com- mand of all the means, all the resources, of this kingdom, of every sort. They have carried all the measures that they proposed. They have found out the way of putting down all opposition, or, at least, of rendering all opposition quite inefficient; and therefore to them, and to them alone, the nation is to look for responsibility for whatever mischiefs ex- 304 PAPER ApAINST GOLD. ist, or are likely to exist. If, indeed, all be well ; if there be nothing to complain of; if the nation be in no danger ; if there be no evil ; then, they have no- thing to be blamed for ; but, if there be any thing in our situation, the existence of which we have cause to lament, to whom are we to look for respon- sibility but to theml But, to take another view of the matter, what, let me ask, has Napoleon done against our commerce and our currency, for which he will not easily find a justification in our example? Have we neglected any means in our power to injure the commerce and the finances of France ? Did not Pitt, from the very outset of the war against the French Jacobins and Levellers, call it a war of finance ? And, were not all our efforts bent down towards the beating of France through her finances ? This is notoriously the fact ; and, as to her commerce, it must be well known to every one, that we risked a war with the American States, for the purpose of intercepting provisions in their way to the people of France, when they were menaced with famine. Was this fair and honourable warfare ? I shall be told that it was. I will not discuss the point. But, if it was so, what reason have we to complain now, when France prevents us, not from receiving' corn from her dominions, but merely from sending- our pro- ducts to those dominions. This is the utmost that Napoleon does, or that he can do ; and I put it, then, to any reasonable man, whether we have real cause of complaint. We may be sorry for what Napoleon is doing ; and we must be sorry for the individuals who suffer from his measures ; but can we complain of him for not receiving our goods now, when we recollect, that we would not suffer the people of France to receive flour from America when we< thought them in the midst of famine, and when we further recollect, that we openly avowed the wish and the endeavour to prevent their receiving Jesuit** 1 I PAPER AGAINST GOLD. 305 Bark, a drug so necessary, in many cases, to the preservation of life ? This was fair in us, I shall be told. Very well. That I am not questioning; "but, if this was fair ; if a state of war tolerated this, have we, I ask again, any reason to complain of him ; any reason to call him tyrant, (as GEORGE ROSE did,) because he will not now permit any part of his people to receive goods which are our produce or our property. Oh, no ! We must expect that the people of France have the same sort of feelings that we have ; and, Gentlemen, mark it well, I pray you, we intercepted the flour on its way to France long before Napoleon's name was known to us. We, or, at least, our venal writers, now affect a vast deal of compassion for the people of France. These writers appear to lament that the French people are subjected to so terrible a despotism. But, either the people of France hear what our writers say, or they do not : if they do not hear it, then it cannot possibly produce any effect upon them ; and, if they do hear it, they cannot fail to call to mind, that we have been at war against them through all their forms of government / and, that while they were under a republican form, or name, our hostility was much more decided and bit- ter than at this moment ; for, we then declared war against the principles of their constitution ; we de- clared that no relations of peace were to be main- tained with them ; and, now that they are under a monarchy, (for that means a government by the will of one person,) we affect to feel a great deal of pity for them ; we sigh to see them free ; and call upon them, as loudly as our venal writers can, to rise against their tyrant. Had we begun war with them only when their revolution had worked itself into a monarchy, then, indeed, our appeals to them against their ruler might have been of some avail ; but, how is it possible for them to believe, that we are now desirous of seeing them free, when they recollect 26* 306 PAPER AGAINST GOLD. our conduct at the outset of the war, and for many years during its continuance ? Ail our appeals, therefore, from. Napoleon to the people of France are absurd, and only bespeak the desperateness of our situation. To return more closely to our subject ; it appears from the report of the Bullion Debate, that LORD CASTLEREAGH said, that the tyrant of the Continent had, thus far, been defeated in all his attempts against us ; that he at first attempted invasion, that he next endeavoured to excite rebellion, that he then assailed our commerce; and, that having failed in all these, he was now endeavouring to ruin our cur- rency. Now, how far this statement was true, I shall not pretend to say ; and, indeed, except as to the last point, it is beside my purpose to make any remark upon what is reported to have been said by this Lord. That that part of the statement is true, there can, however, be little doubt ; for it has been stated in the public prints, that there have been great quan- tities of forged notes, purporting to be notes of the Bank of England, sent into this country from France and Holland, This interesting fact has been very carefully kept out of the London daily papers ; but the country papers have been less cau- tious, owing, I suppose, to their being at too great a distance from good advice and powerful argu- ments. The following article, which I take from the OXFORD MERCURY of the 4th instant, will be quite sufficient to explain the nature of what is go- ing on in Kent. " We are sorry to learn that a vast number of forged notes, purporting to be those of the Bank of England, are in circulation, particu- larly on this coast, to an alarming extent ; we have heard to the amount of 200,000/. having been re- ' cently imported into this country from France and Holland, where it is said they are manufactured ! We know not to what extent the evil may extend. PAPER AGAINST GOLD. 307 Several 5/., 10/., and even 20Z. of those notes have already been detected ; and numerous I/., of the same description } are in circulation ; indeed, at Folk- stone, and some other places, the notes of the Bank of England are almost generally refused in payment from this circumstance; and we hope some steps will be immediately adopted to put a stop to them. Two 5/. were recently passed through the Dover Union Bank ; and a 201. note was remitted to town by a respectable tradesman in Dover, a few days since, which proved to be a forgery. We should recommend every person to keep the number of the notes which pass through their hands, or have them previously endorsed by the person who passes them ; we look upon this to be a very necessary precaution, as it is a matter of the most serious consequence to tradespeople in general ; for if the Bank of England notes can be so readily imitated, how easy must it be to forge the Provincial notes of this and other counties." This is a war of finance with a vengeance ! But even this I am not disposed to call an unfair and dishonourable species of warfare. I am not disposed to call this a cheating, swindling, base, and coward- ly mode of attacking a nation ; indeed, I should not dare to call it so, if I were disposed to it, seeing that we did the same towards the French when they had a paper-money. It is well known to us, but it ought also to be known to our children, (some of whom will, I dare say, read these Letters ;) that, in the year 1791, the French people made a revolution in their government ; that they chose representatives to frame a new constitution for them; that they changed their absolute monarchy, or despotism, into a limited monarchy ; that they declared freedom to De their birthright ; that the nobility, not pleased with the change, left the country ; that the princes of the blood did the same ; that the fugitives met with protection and encouragement from foreign 308 PAPER AGAINST GOLD. Governments ; that these Governments afterwards made war against the French ; that England joined in that war ; that, some time after this war began, the French put their King and Q,ueen to death, and declared their country a republic ; that the French had, at that time, a paper-money, called Assignats ; that upon this paper-money, it was thought, depended the fate of the French revolution; that, from the speeches in the English Parliament, it will clearly appear that the Government of England looked upon the debasement of those Assignats as the sure means of subverting the new order of things in France. All this should be known to our children as well as to ourselves ; and, when they have a thorough know- ledge of these facts, they should be told, that false Assignats, that forged Assignats^ that counterfeit French paper-money ; that these things were fabri- cated in England in quantities immense. They were intended, of course, to be sent into France, there to undermine the French finances, and to pro- duce the overthrow of the Republican government. The former of these objects they did effect ; or, at least, assisted to effect ; and they, in all probability, contributed towards those causes, which finally led to the re-election of the absolute monarchy, in the person of Napoleon. I was always, after hearing of these forged As- signats, very desirous of seeing one of them ; and, some time ago, a gentleman gave me nine or ten, which, with many others, were given to him at the time that the fabrication was going on. He gave me an Assignat for 90 Livres, one for 50 Livres, one for 10 Livres, and several for 5 Livres. We cannot have this fact too strongly imprinted upon our minds, and cannot make the impression too strong upon those of our children. It is a great point, not only in the history of paper-money, but also in the politi- cal history of the world. I will, therefore, give here, as nearly as I can, a copy of one of these PAPER AGAINST GOLD. 309 irged As signals, but not of so large a size as the original, from which I take it. J^ jt OICj. S_}fCjL OT VC " b- ^able au . CO 0) O K <>>. TJ H"H k <5i ? M^ s 1 ^ ^ | H * ? a ^> H S 2. CO* O ^ CO HH ^3 9 p- CD o "o? 2 Cb X P ^ ^4. 3 t^ -^ o ^ ^s S- O> ^N s" 02 s The translation of this is : " Assignat of 5 Li- vres, created 1 Nov. 1794. National domains. Assignat of Five Livres, payable to the bearer by the Extraordinary Chest." And the word " COR- SET" was the name of the Cashier, I suppose, who signed the Assignats in France. Such were the means, which we made use of to- wards the French nation ; and, therefore, I trust, we shall not now hear of any complaints against 310 PAPER AGAINST GOLD. them for their endeavouring to send us an ample supply of Bank notes. u Sauce for the goose is sauce for the gander," all the world over. But, was this ; do I know that this was, the work of Government ? That it was actually done by the order of " the great statesman, now no more," and paid for out of the people's taxes ? It was not a trifling sum that these Assignats cost in the forging. They were wrought with great care in France. There was a very ingeniously contrived dry stamp upon them. The engraving was of most exquisite workmanship. To have effected the imitation, the most ingenious artists in England must have used their talents. But, how do I know, that this forging work was carried on under the authority of the Go- vernment ? Suppose it was not ? What do we, the nation, get by that in the argument ? If it was not the Government who ordered the thing to be done, it was the people of England who did it them- selves ; and, therefore, they have, in that case, still less reason, if possible, to complain of the French for sending over forged Bank Notes to England at this time. Whether, however, it was, or was not, the act of the English minister and Government, you, gentle- men, shall now have a fair opportunity of judging for yourselves. I could here relate to you what I have heard many persons say upon this subject; I could state to you names and transactions upon what I deem, and upon what you would, I dare say, deem very good authority ; but, as to matters of this sort, I always love to deal in undeniable evidence , proof positive ; facts that leave no room for shuffle So I shall do here. It happened, some time after this forging work had been going on, that there was a law-suit between* two of the parties engaged in it. Law-suits are apt to lead to exposures. So it happened now, as you will see by the following Report, which I copy, word for word, from the Law-Books, which are PAPER AGAINST GOLD. 311 daily cited as authorities in all our courts of justice. " STRONGPTH'ARM against LUKYN. Case on a Promissory Note. The Note was drawn by the Defendant, payable to one Caslon, and, by Cas- lon endorsed to the Plaintiff. The Plaintiff proved the Defendant's hand-writing, and the indorsement by Caslon. ERSKINE, for the Defendant, stated his defence to be, that Lukyn was a Stationer, and the Plaintiff an Engraver; and that the Note, upon which the Action was brought, was given to Cas- lon, for the purpose of paying the Plaintiff for the engraving of Copper plates, upon which FRENCH ASSIGNATS were to be FORGED; and con- tended, that as the consideration of the Note was fraud, that it contaminated the whole transaction, and rendered the Note not recoverable by law. Calson, the endorser, was called as the witness. He proved that Lukyn, the Defendant, having it in con- templation to strike off impressions of a considerable quantity of Assignats, to be issued abroad, had ap- plied to him for the purpose of recommending an engraver for the purpose of engraving the necessary plates ; and that Lukyn represented to him that they were for the Duke of York's army. He said, that he applied to Strongi'th'arm, the Plaintiff, who, at first, declined the business totally ; but that, being assured by the witness that it was sanctioned by Government, and was for .the use of the Duke of York's army, he then consented. The witness fur- ther denied that it was ever communicated to the Plaintiff that they were to be cirrulated for any other purpose than as he had represented. LORD KENYON said, that if the present transaction was grounded on a fraud, or contrary to the laws of na- tions, or of good faith, he should have held the Notes to be void ; but that it did not appear that there was any fraud in the case, or any violation of positive law. Whether the issuing of these Assignats, for the purpose of distressing the enemy, was lawful in carrying on the war, he was not prepared to say , 312 PAPER AGAIN3T GOLD. or whether it came within the rule an dolus an virtus quis in hoste requisit ? But let that be as it might, it did not apply to the present case. It was not in evidence, that the Plaintiff was a party in any fraud, or that it was ever communicated to him that the Assignats were to be used for any improper purpose : on the contrary, he supposed that they were circulated by the authority of the higher pow- ers of this country ; and, therefore, did not ques- tion the propriety or legality of the 'measure. His Lordship declared his opinion, therefore, to be, that the consideration was not impeached, and that the Plaintiff was entitled to recover. The jury found a verdict for the Plaintiff. MINGAY and MARRYAT, for the Plaintiff. ERSKINE, and LAW, for the De- fendant.* Having read this document, gentlemen, you will want nothing from me to enable you to de- cide who it was that caused the Assignats to be forged ; nor will you want any one to assist you in forming a correct opinion as to the conduct of either the Plaintiff, the Defendant, or the Judge. The thing is before you ; and it speaks for itself much too plainly to be misunderstood. Well, now, after this ; with this before our eyes ; knowing that the world is well acquainted with this fact, is it not a little too impudent in us to pretend to find fault with the French for supplying our coast with Bank Notes? I do not know any thing that is more disgusting than this species of injustice, which proceeds from self-conceit. It is the worst kind of insolence ; and whoever has paid attention to its ef- fects, must have perceived, that it never fails to ex- cite contempt in men of sense. What, I should be glad to know, is there in us that we should be justi- fied in forging French paper-money any more than the French should be justified in forging English paper-money ? Upon what ground is it that we claim the exclusive right of forging the paper money of our neighbours ? t See Espinasse's Reports, Mich. Term, 36 Geo. III. 1795. PAPER AGAINST GOLD. 313 After what we have seen above, you will, I am persuaded, agree with me, that it is childish in the extreme, to say the least of it, for us to complain of the Emperor of France for having, as LORD CASTLE- REAGH said, set about a scheme for the ruin of our currency. And, it is equally childish in us to sup- pose, that he will not now, when we have proclaimed the effects, persevere in his hostility to our commerce. He is now told, by a majority in the House of Com- mons, that it is his system, which has produced all our pecuniary distress. We now say that it is he who has filled the Gazette with the names of Bank- rupts ; which has made one of the two " pillars of the Stock Exchange" blow his brains out ; which has raised the paper price of the Dollar ten per cen- tum at a slap ; and which now makes the fund- holder tremble. He is now told this by our Minis- ter of finance ; aye, and by the vote of a majority, and a very great majority, too, of the Honourable House, upon whose Journals it now stands declared and recorded, that the commercial system of Napo- leon has produced the very effects that he intended, and that he vowed, it should produce. And, yet, there are men amongst us to call Napoleon a mad- man ! I have taken up too much of your time to enter now upon the subject of Depreciation, which, therefore, I must postpone till my next, begging you, with reference to the above related facts, always to bear in mind, that, at the outset of our war against the Jacobins of France, we had plenty of gold and the French had nothing but paper, and that now the French have plenty of gold, and we have nothing but paper. I am, Gentlemen, Your friend, WM. COBBETT. Stale Prison, Newgate, Friday, May 17th, 1811. 27 314 PAPER AGAINST GOLD. LETTER XXV. *' Nothing is more certain than death, and nothing more uncertain than the time of dying ; yet we can always fix a period beyond which man can- not live, and within some moment of which he will die. We are enabled to do this, not by nny spirit of prophecy, but by observation of what has happened in all cases! of human or animal existence. If, then, any other subje t, siu;h for instance, as a system of finance, exhibits, in its progress, a series of symptoms indicating decay, its final dissolution is certain, and from those symptoms we may calculate the period of that dissolution." Paine. Decline and Fall of the British System of Finance, published in 1795. The subject of Depreciation discussed Lord Stanhope's Bill Lord King's Notice to his Tenants. T GENTLEMEN, THE foregoing Letter we began with proposing to discuss the question of depreciation, but were stop- ped by the desire of showing how childish, and, in- deed, how unjust it was in our Government to com- plain of the endeavours said to be used by the French for destroying our paper-money, seeing the endea- vours which were used here to destroy the Assignats in France. We will now resume the subject of de- preciation, and see whether the paper-money of England be, or be not, actually depreciated; and, if we find that it is, we will inquire whether it can be restored to its former value by any of the means, called remedies, that have been pointed out by any of those who are our rulers, or lawgivers. To depreciate means to lower in value ; and the word depreciation is used to signify that state in which any thing is, when it is lowered, or has fal- ~ttn, from its former value. Hence the term depreci- ation, as applied to Bank Notes ; and, when we thus apply it, accompanied with the affirmative of the proposition, we say, that Bank Notes have fallen in value, and, of course, that any given sum in such notes is not worth so much as it formerly was. Much puzzling has, upon this subject, arisen from PAPER AGAINST GOLD. 315 a very natural cause ; namely, that the note always retains its nominal value ; that is to say, always goes by the same name ; a pound note still is called a pound note, whether it be worth as much as it for- merly was, or not. But, to this point we shall come more fully by-and-by, after we have spoken of the way in which a depreciation of money, or the lower- ing of the value of money, takes place. Money, of whatever sort, is, like every thing else, lowered in its value in proportion as it becomes abundant or plenty. As I said upon a former occa- sion, when apples are plenty apples are cheap ; and cheap means low in price. The use of money is to serve men as a sign of the amount of the value of things that pass from man to man in the way of purchase and sale. It is plenty or scarce, in propor- tion as its quantity is great or small, compared with the quantity of things purchased and sold in the community ; and, whenever it becomes, from any cause, plenty, it depreciates, or sinks in value. Suppose, for instance, that there is a community of ten men, who make amongst them 100 purchases in a year, each purchase amounting to 1 pound. The community, in that case, would possess, we will suppose, 10 pounds, and no more, because the same money might, and naturally would, go backwards and forwards, and because, except under peculiar circumstances, men do not hoard. Now, suppose that the money in possession of this community is doubled in quantity, without any other alteration taking place, the quantity of goods and chatties and the quantity of things, including services, purchased, and the number of purchases all continuing the same. Suppose this; and, we are here speaking of money of any sort. No matter what sort. Sup- pose it to be gold, and that its quantity is thus dou- bled. The consequence would be, of course, that at each of the hundred purchases, double the sum would be given that was given before ; because, if this were not the case, part of the money must 316 PAPER AGAINST GOLD. be kept idle, which, upon a general scale, can never be, there being no motive for it. Suppose that one of the hundred purchases wa.s that of a horse. The purchase, which was made with 1 pound before the doubling of the quantity of money, would require 2 pounds after that doubling took place ; and so on through the whole ; and, in such a state of things people would say, that prices had risen, that com- modities had doubled in price, that every thing was twice as dear as it used to be. But, the fact would be, that money was become plenty, and, like every thing else, cheap in proportion to its abundance. It would be, that money had fallen or had been de- preciated, and not that things had risen; the loaf, for instance, having a real value in its utility in supporting man, and the money having only an ima- ginary value. Prices in England have been rising, as it is com- monly called, for hundreds of years ; things have been getting dearer and dearer. The cause of which, until the Bank Note system began, was the increase of gold and silver in Europe, in consequence of the discovery of South America and the subse- quent working of the mines. But the increase of the quantity of gold and silver was slow. " Na- ture," as PAINE observes, " gives those materials out with a sparing hand;" they came, as they still come, in regular annual quantities from the mines ; and that portion of them which found its way to this country was obtained by the sale of things of real value, being the product of our soil or of our labour. Therefore, the quantity of money increased very slowly ; it did increase, and prices gradually rose, but the increase and the rise were so slow as not to be strikingly perceptible. During the average life of man, the rise in prices was so small as hardly toat- tract any thing like general attention. Curious men observed it, and some of them recorded the progress of prices ; but, as there was no sensible difference in prices in the average life of man, the rise never PAPER AGAINST GOLD. 317 became an object of general interest, as long as gold and silver were the only currency of the country. But, when the funding system began, and paper became, in many cases, a substitute for gold and silver ; when the increase of the quantity of money in the country was no longer dependent upon the mines ; when the check which nature had provided was removed ; then money, or its substitute, paper, increased at a rate much greater than before, and prices took a proportionate rise, as they naturally would. The nature of the FUNDING SYSTEM has been fully explained before ; we have also seen how it would naturally cause the paper-money to go on increasing. We have seen, that the Government, as soon as it began to make loans, was compelled to establish a Bank, or a something, in order to get the means of paying the interest upon the loans. The amount of the loans would naturally go on increas- ing in order to meet the rise in prices, and thus the increase of the paper would continue causing rise af- ter rise in the prices, and the rise in the prices would continue causing addition upon addition to the quan- tity of the paper. This was the natural progress, and it was that which actually took place. Still, however, the paper passed in company with the gold and silver. Money was more plenty; it was of less value; and, of course, any given quan- tity of it would purchase less bread, for instance, than formerly ; but, still there was no difference in the quality of the two sorts of money j metal and aper both not only passed at the sums that they ad usually passed at, but people liked the one just as well as the other ; and it was a matter of perfect indifference to any man, whether he took a hundred guineas in gold, or one hundred and five pounds in paper. And, the reason of this indifference was, that the holder of a bank note could, at any moment, go to the Bank, and there demand and receive payment in guineas. This was the reason why the paper passed in society with the gold. But. it was impos- 27* p h 318 PAPER AGAINST GOLD. sible that this society should long continue after the paper increased to a very great amount, and especi- ally after the notes became so low in nominal value as five pounds ; for then it was evident, that all the taxes would be paid in paper ; that the Government would receive nothing but paper; that the Bank could get nothing but paper from the Government ; that whatever gold went out of the Bank would never return to it ; and, of course, that the Bank would, in a short time, be unable to pay its notes in gold, it called on for that purpose to any great extent. A call of this sort was made upon it in 1797 ; and, as we have seen, and now feel, the Bank was unable to pay. Its creditors, that is to say, the hold- ers of its notes, demanded their money ; the Bank flew to the Minister Pitt for protection ; the Minis- ter, by an Order of Council, authorized the Bank to refuse to pay its creditors ; the Bank did refuse ; the Parliament passed an Act to shelter the Minister and the Bank Directors and all whc had been guilty of this violation of law, and, at the same time enacted, that, for the future, the Bank should not be compel- lable to pay its notes in gold or silver. After this memorable transaction, the full and true history of which I have recorded in the foregoing Letters ; af ter this, the whole concern assumed a new face and indeed a new nature. The holder of a bank note could no longer go and demand payment of it in guineas : it was impossible, therefore, that he should look upon 105Z. in notes as quite equal in value to 100 guineas. Still, however, in consequence of the meetings and combinations of the rich, and of the enormous influence of the Government, to which may be added the dread in every man of being marked out as a Jacobin and Leveller ; in conse- quence of all these, and of the necessity of having something to serve as money, the notes continued to circulate ; and, as the alarm subsided, the guinea returned and circulated in company with them ; but not with that cordialitv that it used to do. It be. PAPER AGAINST GOLD. 319 came much less frequent in its appearance in com- pany with the notes ; it held itself aloof ; seemed to demand a preference ; but not appearing to like to assume this superiority over an old and familiar as- sociate, and yet unwilling to pass for so much less than its worth, it soon began to keep away alto- gether, retiring to the chests of the hoarders, or go- ing upon its travels into foreign parts, until such time as it found itself duly estimated in England, which would naturally be when people began to make openly a distinction between paper and coin. That time arrived about two years ago ; but, no sooner was the distinction thus made, and acted upon, than the Government began to prosecute the actors, and commenced, I believe, in the well known case of DE YONGE, who, under laws passed about two hundred years before such things as bank notes were ever heard of, was convicted, about a year ago, of the crime of exchanging guineas for more than their nominal value in bank notes. DE YONGE moved for an arrest of judgment ; the case has been since ar- gued before the judges; and their decision thereon, has recently been promulgated. Other persons have been prosecuted in the same way and upon the same ground, the effect of which naturally has been tc deter people from openly purchasing and selling guineas,and also from tendering them generally in payment for more than their nominal value in paper. But, it is very notorious that the distinction is. nevertheless, made, and that, in payments, men do take gold at its worth in comparison with the paper. Two prices are not yet openly and generally made ; but, they exist partially, and the extent of them is daily increasing. To this point, then, we are now arrived, and here we see proof, not of a depreciation of money of all sorts, arising merely from that general plenty of money spoken of above ; but arising from the abun- dance, or plenty, of paper, that is to say, the great quantity of the paper compared with that of the coin. Hence we say, that the bank notes have depreciated, 320 PAPER AGAINST GOLD. or fallen in value ; and, that there should be found any human being to assert the contrary, or to believe, or to affect to believe, the contrary, is something that, were not the fact before our eyes, no man could think possible : but, we live in times when wonder no longer seems to form a feeling of the mind. This state of things it was easy to foresee ; but, the nation has been deluded by the specious argu- ment of the equal powers of gold and paper in purchases. " Go to market," we have been told, " and see whether the pound note and a shilling will not bring you as much meat or cloth as a guinea" This was conclusive with unreflecting minds, and it quieted, or assisted to quiet, all those, who, though they were capable of discerning, dared not look the fearful truth in the face. I looked it in the face ra- ther more than eight years ago, and strenuously la- boured to prepare my countrymen for what has now come, and what is now coming to pass. Upon one occasion, this standing delusive argument was made use of in answer to me : whereupon I made the fol- lowing remarks : " The objection of my other corres- pondent has more plausibility. These are his words : * I think the argument, that Bank paper is depreciated, drawn from the difference between the sterling and the current value of a dollar, if it prove anything, proves too much. That guineas are depreciated you will hardly insist, yet I would sturdily maintain, from your premises, that they are, since a guinea will not purchase so many dollars as it formerly would.' Yes, but I do insist though, that guineas are depreciated: not in their intrinsic value, but in their value as currency, that is to say, in their power of purchasing commodities in this country. When there is a depreciating paper in any country, the current coin of that country depreciates in its powers along with the paper, because it has a fixed nominal value, and it can pass currently for no more than an equal nominal value in paper, until the paper is at an open discount. The metal is degraded by the PAPER AGAINST GOLD. 321 society of the paper ; but, there comes a time when it will bear this degradation no longer ; it then rises above its nominal value, or, in other words, the paper is at a discount." This was published so long ago as the 14th April, 1804. " There comes a time /" Aye, and that time is now come. But, let me not be guilty of rob- bery, and especially of the Dead, and more espe- cially of one whose writings, and upon this very subject too, as well as other subjects, I formerly, through ignorance, condemned. I allude to the wri- tings of PAINE, the abused, the reprobated, the ana- thematized, TOM PAINE. In his work, from which I have taken the perspicuous and impressive passage that serves me as a motto to this Letter, and the equal of which has seldom dropped from the pen of any man ; in that work, PAINE thus exposes the de- lusive argument of which I have just been speaking ; " It is^aid. in England, that the value of paper keeps equal pace with the value of gold and silver. But the case is not rightly stated : for, the fact is, that the paper has pulled down the value of gold and silver to its own level. Gold and silver will not purchase so much of any purchaseable article at this day (March, 1796) as they would have purchased if no paper had appeared, nor so much as they will in any country of Europe, where there is no paper. How long this hanging together of paper and money will continue makes a new case ; because it daily exposes the system to sudden death, independent of the natural death it would otherwise suffer." Here he lays down the principle ; and, if, instead of re- viling his writings, the Government of England had lent a patient ear to him, and taken a lesson from his superior understanding and experience, how different would have been our situation at this day. He pro- ceeds thus ; " I have just mentioned that paper in England has pulled down the value of gold and sil- ver to a level with itself; and that this pulling down of gold and silver money has created the appearance 322 PAPER AGAINST GOLD. of paper money keeping- up. The same thing, and the same mistake, took place in America and in France, and continued for a considerable time after the commencement of their system of paper ; and the actual depreciation of money was hidden under that mistake. It was said in America, at that time, that every thing was becoming dear ; but gold and silver could then buy those articles no cheaper than paper could ; and therefore it was not called depreciation. The idea of dearness established itself for the idea of depreciation. The same was the case in France. Though every thing rose in price soon after assig- nats appeared, yet those dear articles could be pur- chased no cheaper with gold and silver, than with paper, and it was only said thnt things were dear. The same is still the language in England. They call it dearness. But they will soon find that it an actual depreciation^ and that this depreciation is the effect of the funding system; which by crowd- ing such a continually-increasing mass of paper into circulation, carries down the value of gold, and silver with it. But gold and silver will, in the long-run, revolt against depreciation, and separate from the value of paper ; for the progress of all such systems appears to be, that the paper will take the command in the beginning, and gold and silver in the end." How well is this expressed, and how clearly the truth of it is now verified! Yes: we talk about dearness; we talk of high prices ; we talk of things rising in value ; but, the fact is, that the change has been in the money, and not in the articles bough and sold ; the articles remain the same in value, bu the money, from its abundance, has fallen in value. This has till of late been imperceptible to the mass of the people, who were convinced of the non-depre- ciation by the argument built on the circumstance of the guinea and the paper being upon an equal footing at market. They did not perceive, that the paper had pulled down the gold and silver along PAPER AGAINST GOLD. 323 with it ; they did not perceive that the coin was sliding by degrees out of the society of the paper ; they did not perceive that, in time, the coin would disappear altogether ; they did not perceive that an open contest would, at last, take place between the guineas and the paper, and that, if the law came to the assistance of the paper, the coin would quit the country. Now, however, they do perceive this; the facts have all now been established in a way that seems, at last, to have produced conviction even in the minds of this " most thinking" people ; but, there is reason to fear, that this conviction will have come too late. How happy would it have been for this nation, if the opinions of Mr. PAINE, touching this subject, had produced, at the time, their wished- for effect! No man in England dared to publish his work. Any man who had published or sold it would have been punished as a seditious libeller. Yet, in my opinion, does that work ; that little work, in the space of twenty-Jive pages, convey more useful knowledge upon this subject, and discover infinitely greater depth of thought and general powers of mind, than are to be found in all the pamphlets of the thre6 score and two financiers, who, in this country, have, since I came into this jail, favoured the world with their opinions upon the state of our money system. The writings of these people would make twenty- Jfive thick octavo volumes ; and in all of them there is not so much power of mind discovered as in PAINE'S twenty-Jive pages. Yet, no man would dare to publish this little work in England. By ac- cident I possess a copy that I brought from America, but which I never read till after my return to Eng- land. In 1803, when there was much apprehension of invasion, and when great complaints were made of the scarcity of change, I began to read some books upon the subject ; and, after reading several without coming to any thing like a clear -notion of the real state of our currency, I took up the little essay of PAINE. Here I saw to the bottom at once 324 PAPER AGAINST GOLD. Here was no bubble, no mud to obstruct my view : the stream was clear and strong : I saw the whole matter in its true light, and neither pamphleteers nor speech-makers were, after that, able to raise even a momentary puzzle in my mind. PAINE not only told me what would come to pass, but showed me, gave me convincing reasons, why it must come to pass ; and he convinced me also, that it was my duty to endeavour to open the eyes of my country- men to the truths which I myself had learnt from him ; because his reasoning taught me, that, the lon- ger those truths remained hidden from their view, the more fatal must be the consequences. The oc- casion of this work of PAINE is worthy of notice. One of the motives of writing it was, as he says, at the close, to retaliate upon PITT, who, in speaking of the French Republic, had said, that she was " on the verge, nay, even in the gulf of Bankruptcy" PAINE said, that England would soon be in a worse situation than France as to her finances ; and, in less than twelve months after he wrote his work, the Bank became unable to pay its notes in cash. To return to the subject of depreciation, the fact has now been established in all sorts of ways. Gold coin has been, and is, sold at a premium : a guinea will sell for 27 shillings, and the other coins of the realm in the same proportion ; many persons in London have written upon their shop-windows notifications that they will take the coin at a higher than the nominal value ; in numerous cases, a dis- tinction is made in prices paid in coin, and prices paid in paper. If these are not proofs of an actual depression of the paper, what, I should be glad to know, will ever be admitted as proof of that fact ? Indeed, there is no longer any doubt remaining upon the subject ; audj therefore, we will now proceed to take a view of the REMEDIES that have been proposed by our Rulers and Law-givers, who, if they had followed the advice given in PAINE'S Se cond Part of the " RIGHTS OF MAN," instead of pro PAPER AGAINST GOLD. 325 seeming the author, would not, I am convinced, have had to lament the present state of our finances. As to REMEDIES, Gentlemen, I, in the first of this series of Letters, stated to you, that the Bullion Committee had recommended to the House of Com- mons, to pass a law to compel the Bank to pay their notes in gold and silver at the end of two years. This same proposition has been since made in the House ; but the House have resolved, that no such measure is necessary. Those who opposed the proposition said, that the Bank had not the gold, and could not get it, and that, therefore, they could not pay in gold. This was a very sufficient reason : and, I must confess, that I was, and am, as far as this goes, exactly of the opinion of these gentlemen. For, to what end pass such a law, if the gold was not to be had? There were several sensible men, belonging to the Bullion Committee, and the gen- tleman who brought the measure forward in the House, is looked upon as a person of good under- standing. It, therefore, appeared astonishing to me, that they should propose such a measure, seeing that I have never been able to discover any way whatever by which gold could possibly return to the Bank, and remain there in quantity sufficient to ena- ble that Company to pay their notes in gold, upon demand. To resume payments in gold, would, in- deed, be a complete remedy ; but, to do this, in my opinion, and, for many years past, has been utterly impossible. By what means are the Bank Company to get the gold ? We are told, that there is gold enough, if the Bank Company will but purchase it. What are they to give for it ? Why, their paper, to be sure ; and, as it would require 27 shillings in their paper to purchase a guinea, this would be a most charming way of obtaining the means of pay- ing off the paper with guineas. Let us take an in- stance. Suppose the Bank Company, by way of preparing for cash payments, to be purchasing all the guineas they can find, and, in such case, thev 28 326 PAPER AGAINST GOLD. would, of course, apply to our old friend, Mrs. DB YONGE, to whom, by the by, I here present my con- gratulations on the late decision of the judges, in favour of her husband ; the Bank Company would, I say, naturally apply to this good lady, who, it being now decided, that the old biting law, does not forbid the buying and selling of bank notes and guineas, would drive with them as good a bargain as she could. Suppose them to buy 100 guineas of her at the present price, 27 shillings each, they would, of course, give her for them 135 pounds in their notes. And, thus they must go on with other people. Ha- ving, at last, got a good lot of guineas together, they begin paying their notes in guineas. It is pretty evident, that the vast increase of paper, occasioned by the purchase of the guineas, would have caused a new and great depreciation of the paper, and that, therefore, the moment the Bank was open to de- mands in coin, people would crowd to it in all di- rections. I can fancy the eager crowd now before me, pressing in from every quarter and corner ; and, amongst the very foremost and most eager, I think I see our friend, Mrs. DE YONGE. " What do you do here, Madam," I think I hear a dejected Director say, " what do you do here, you who sold us gui- neas but the other day ?" " Aye, sir," says the lady, " and for these very guineas I am come again, and mean to take them away, too, with 105 pounds of the 135 that you gave me for them." Need I say any more upon this subject? Is it not something monstrous to suppose, that it would be possible for the Bank Company to buy gold in quan- tity sufficient to be able to pay their notes in it? " Well," say others, " but the Bank may lessen the quantity of its paper by narrowing' its discounts" To be sure, they might ; and the only consequence of that would be, that the taxes would not be paid, and, of course, that the soldiers, the judges, and all other persons paid by the public, would have to go without pay. The discounts make a part of the PAPER AGAINST GOLD. 327 system ; and, if it be put a stop to, that is neither more or less than one of the ways of totally de- stroying the system. To lessen the quantity of the paper is, therefore, impossible, without producing ruin amongst all persons in trade and agriculture, and without disabling the country to pay the taxes, at their present nominal amount. But, suppose all other difficulties were got over, did these gentlemen of the Bullion Committee, ever reflect upon the consequences of raising the value of money to what it was before the Bank Stoppage ? Sir FRANCIS BURDETT, in his speech, during the Bullion Debate, told them of these consequences. He observed, and very justly, that, if money were, by any means, to be restored to the value it bore in the year 1796, the interest of the National Debt never could be paid by the people; that interest, he observed, was now 35,000,00(U. a year ; and, if the value of money was brought back to the standard of 1796, this interest would instantly swell to 43,000,000/. of money, at the present value. All the grants, pensions, fixed emoluments, pay of sol- diers, judges, chancellors, clerks, commissioners, and the rest, would be raised, in point of real amount, in the same proportion ; so that, it would be utterly impossible for taxes, to such an amount, to be raised.* And, if it were possible, it would be fre- * The above quoted speech is my property. I was in Newgate at the time that it was made ; and, when the de- bate, during which it was uttered, was about to come on, I besought BURDETT to put on record these opinions, telling him, that the time would come and must come, when he would have to refer to them with triumphant exultation ; that it was nonsense to hope to obtain reform, as long as the paper arid funding system remained unhurt ; that it could not so remain for a great many years; and that when it be- gan to produce all the horrible calamities, that must, in its last stages, be its natural fruit, it would be a proud thing for him, and would give him great weight with the nation, to be able to show, that, if his advice had been followed, these ca- lamities would never have been known, or, at the least, would have been greatly mitigated. Finding him willing to follow my advice, I gave him the opinions on paper; he took 328 PAPER AGAINST GOLD. quently unjust ; for, observe, all the money (making nearly one half of the National Debt) that has been borrowed since the Bank Company stopped paying in gold and silver ; all the money borrowed since that time ; all the loans made in the name of the public since that time ; all the money lent to the public, as it is called, has been lent in depreciated paper ; and, that which has been so lent this year, nas, if guineas are at 27 shillings, been lent in paper ; 27 shillings of which are worth no more than a guinea. And, are the people to be called upon to pay interest upon this money in a currency of which 21 shillings are worth a guinea ? This would be so abominably unjust, that I wonder how any man like Mr. HORNER, ever came to think of it. He ex- pressly stated, that the paper was now worth only 155. Wd. in the pound ; of course, he must have known, that this was the sort of thing of which the loans, for some years past, consisted ; and yet, he would have had a law passed, the effect of which would have been to make the people pay interest for this money at the rate of twenty shillings in the pound. This is what never could have been sub- mitted to : not because the people would have re- sisted ; that is not what I mean ; but it is what could not have been carried into effect, and, for the same reason that the man could not have two skins from the carcass of the same cat. If the quantity of the Bank paper were diminished, its value would rise ; and, if its value rose, the value of the interest upon the National Debt would rise also; therefore, the paper away, made it his own, and uttered the opinions as above, almost m my very words. Since that time, he has. in the hope of keeping me out of my country for life, published my private letters, and has done every thing within his pow- er to destroy my character, and my means of being useful to my country. I have triumphed over him completely. He has been baffled in all his base attempts against me ; but, I think it right injustice to my readers, to pluck this shining feather (out of scores that I might pluck) from the wing of this ungrateful Jack-Daw. PAPER AGAINST GOLD. 329 to enable the people to continue to pay the interest upon the Debt, the amount of the interest must be lessened, and what would that be but a partial sponge. So that, turn and twist the thing, whate- ver way you will, you still find it the same ; you still find, that the system must go on in all its parts, or be put a stop to altogether. In most other cases, when men talk of a remedy, they advert to the cause of the evil. If I find that my .health is injured by drinking brandy, the first thing I ought to do in order to recover my health, would naturally be to leave off drinking brandy. What a fool, what worse than idiot, must that man be, who, feeling the fire burn his shins, still retains his seat. Yet, in this important national concern, never do you find any of our writers or legislators dwelling upon the cause of the evil, of which they appear so anxious to get rid. They tell us, indeed, that the depreciation .of the paper is occasioned by its excessive quantity ; but here they stop ; they never go back to the cause of that excessive quan- tity of paper ; or, if they do, they only speak of the interests of the Bank Company. If they did go back to the real cause, they would find it in the in- crease of the national Debt, to pay the interest of which, commonly called dividends, has required, has rendered absolutely necessary, the present quan- tity of paper. Indeed, one engenders the other. Every loan occasions a fresh batch of paper to pay the interest upon it ; that fresh batch of paper causes a new depreciation and a new demand for paper again to make up in the quantity what has been lost in the quality. So that to talk of lessening the quantity of the paper, while the national Debt remains undi- minished, does really seem to me something too ab- surd to be attributed to any man of sense. What, then, must it be to talk of lessening the quantity of paper, while the national Debt is increasing at an enormous rate, and while it is notorious that that Debt has been nearly doubled in amount during the 28* 330 PAPER AGAINST GOLD. last fourteen years; aye, while it is notorious, that, during the last fourteen years, that Debt has increased as much as the whole amount of it was before ; or in other words, that since 1796 as much money has been borrowed by the Government as was borrowed in the whole hundred years preced- ing ? What must it be, then, to talk of lessening the quantity of the paper, while the national Debt, which was, and is, the cause of the paper, keeps on in this manner increasing ? One really would think that such a proposition could have originated only in Bedlam. In 1798, the next year after the stoppage, the amount of Bank of England Notes in circulation was, 13,334,752/. ; and the amount of the interest upon the national Debt, in that year, was, 17,750, 4Q2L In 1809, the amount of the Bank of England Notes in circulation was, 21,249,9802. ; and the amount of the interest upon the national Debt in that year was, 30,093,447/. (exclusive of Irish loans.) Now let this be tried by the rule of Three, and you will see with what exactness the amount of the Bank Notes keeps pace with the amount of the inte- rest upon the national Debt, commonly called the Dividends, which many poor creatures in the coun- try look upon, or, rather, used to look upon, as some- thing of a nature almost divine. Let us put this down a little more distinctly. In 1798, the Dividends amounted to .... 17,750,402 The Bank Notes out in circulation . . 13,334,752 In 1809, the Dividends amounted to 30,093,447 The Bank Notes in circulation . . . . 21,249,980 Here we have the real cause visibly before us. What folly, what madness, is it then, to talk of lessen- ing the amount of the notes, while we are continually augmenting the amount of the Dividends, which are the cause of the notes ? Here we have before our eyes proof that the Dividends (by the use of which word I mean to include all the annual charges upon the Debt) and the Bank Notes have gone on increasing for the last ten years, and I had before shown that they PAPER AGAINST GOLD. 331 had done so theretofore ; and, with this fact before our eyes, we, the people of this "most thinking na- tion," hear some of our legislators propose to lessen the amount of the paper, while not a man of them seems to dream of lessening the amount of the Debt. We hear them propose to narrow the stream, while they say not a word about narrowing the spring whence it flows. They have seen, or you, at least, have seen, Gentlemen, that the bank-paper arose out of the national Debt ; you have seen that the Bank was created in a short time after the Debt be- gan ; you have seen the increase of the paper keep an exact pace with the increase of the Debt ; and, is it not then, to war against facts, against a century of experience, against the nature of things, to propose to narrow the issues of the paper without previously narrowing the bounds of the Debt and its Dividends ? If the authors of this proposition had read the work of PAINE, they would never have offered such a pro- position. Read this work they may, but they have not duly considered its arguments, or they have shut their eyes against the clear conviction that it is cal- culated to produce. He pointed out in his Second Part of the Rights of Man, the means of saving England in the way of finance. That work was written in 1791. So early as that he foresaw and foretold what we have now before our eyes, and what we have daily to expect. He there pointed out the sure and certain means of effectually putting a stop to further increase of the Debt, of insuring a real diminution of it, and, at the same time of doing ample justice to the fund-holders. For this pam- phlet he was prosecuted, and having gone out of the country, he was outlawed. A Royal Proclamation was issued principally for the purpose of suppressing his work, scores of pamphlets having been written in answer to him in vain. He was burnt in effigy in most parts of this his native country ; and his works were suppressed by the arm of the law. Well, our Government had its way ; it followed its own coun- 332 PAPER AGAINST GOLD. sel and rejected that of PAINE ; he was overcome by it, and driven from the country ; those who endea- voured to cause his principles to have effect were punished or silenced, or both: and, what is the re- sult ? That result is now before us, and fast ap- proaching us ; and, in a short time, in all human pro- bability, events will enable us to form a perfectly correct decision upon the respective merits and de- merits of the then conflicting parties. Now, Gentlemen, if you have attentively read the Letters, of which I now address to you the XXVth, you will have no doubt at all, that the cause of the influx of paper and of the consequent depreciation of all money first, and then of the paper itself alone, as compared to the money ; you will have no doubt that the real cause of all this is, the increase of the National Debt ; and, yet, in all the Parliamentary debates upon the subject, you have heard of scarcely any man who ventured to mention this cause. It was a thing too tender to touch. It was what we call a sore place ; and, the old proverb about the failed horse applied too aptly. If the depreciation ad been traced to the National Debt, as Mr. HORNS TOOKE once traced it while he was in Parliament; for. he then foresaw and foretold what was now come to pass, and told the House, that, if they continued the then expenditure, the fund-holder would not get, in a few years, a quartern loaf for the dividend upon a hundred pounds of stock ; if the depreciation had thus been traced back to its real efficient cause, it would have awakened reflections of an unpleasant tendency ; it would have set men to consider what was the cause of the increase of the Debt ; to look back and inquire whither the money was gone ; for what purpose it had been borrowed ; who were % the persons that had profiled from that borrowing ; who, in short, it was that had swallowed all that money, the interest of which the nation was paying, and had so long been paying. These reflections it was not the desire of either party to awaken; but PAPER AGAIN3T GOLD. 333 they belong to the subject, they naturally present themselves to every one, who looks only a little be- neath the surface, and I venture to say, that, in the end, they will become familiar to every man in the kingdom. If this real cause of the evil had been acknowledged, it would have saved a great deal of time ; for, then, men would not have amused them- selves with talking about such REMEDIES as that of Mr. HORNER; and all the talk about the narrow- ing of discounts and the purchasing of gold and the improving of the exchange would have been heard like the twice told tale of an idiot. The short and the only question would have been this : can we, by any means, diminish the amount of the Divi- dends ? And if that question had been answered in the negative, there was no course, for those who wished to support the Pitt system to -pursue, but that of letting things take their own course, and aid the paper with their wishes. So much for the REMEDY of the Bullion Com- mittee ; but, our attention is now called to another, founded on more imperious circumstances. I allude to the proposition of EARL STANHOPE, which was, on the 27th of June, brought forward in the shape of a Bill, and which is, in that shape, now actually before the House of Lords, where it has undergone a second reading. Compared with this proposition, all that has been said and done before is mere child's play. This Bill brings the matter home to the pub- lic mind ; it shows the most credulous that even those, on whose stoutness they rested their faith, be- gin to quiver. It cries, a truce with all pretensions. It puts the sense and the sincerity of every disputant to the test. The Minister told us, that he wished the debate on the Bullion Report to come on, that the matter might be set at rest. Set at rest! Mercy on us! Set at rest! And so said OLD GEORGE ROSE too. But what did they mean by set- ting the matter at rest ? Is it possible, that they could imagine, that this matter was to be set at rest ; 334 PAPER AGAINST GOLD. that this great question of paper money ; that this subject in which every human creature in the coun- try is so deeply interested ; is it possible that they thought this matter would be completely set at rest by a vote for their majority ? No, noi This is one of the things that that House cannot do. They can do a great deal ; they can do more than I dare to trust myself to describe ; but, they cannot set this matter at rest ; nor have they, and all the branches of the Government united, the power to stay the pro- gress of the paper money only for one single hour. The Minister and his people have now seen what rest they insured for the subject ! I always said, that the " first man of landed property who openly made a distinction between paper and gold, would put the whole system to its trumps, and compel the bank notes ,io sue for the power of the Government for their .protection." This has now been verified, and the remainder of my prediction, which I need not here repeat, is .not far from its accomplishment. The grounds of LORD STANHOPE'S proposition were stated by himself very explicitly, in moving, the 2nd instant, the second reading of his Bill. He said, that .he had long thought upon the subject, and had long entertained the opinion, that some legislative measure was necessary to preserve the bank note system from total ruin ; that a notice recently given by LORD KING to his tenants, signifying that he would no longer receive his rents but in gold or in a quantity of paper equivalent in powers of purchase to gold,* had convinced him that there was no time * " By Lease, dated 1802, you have contracted to pay the annual rent of 471. bs. in good and lawful money of Great Britain. In consequence of the late great depreciation of pa- per money, lean no longer accept any bank notes, at their nominal value, in payment or satisfaction of an old contract. I must therefore desire you to provide for the payment of your rent in the legal gold coin of the realm. At the same time, haying no other object than to secure payment of the real intrinsic value of the sum stipulated by agreement, and being desirous to avoid giving you any unnecessary trouble, I shall be willing to receive payment in either of the manners PAPER AGAINST GOLD. , 335 to be lost, and that the measure in contemplation ought to be adopted before the Parliament rose. He said that the Ministers having declared, that their only objection to the measure arose from an opinion, that they thought no measure of the kind necessary, being persuaded that nobody would be found to fol- low the example of Lord King, it was only neces- sary for him to show them that there were others to follow that example, in order to convince the Minis- ters, that the Bill was entitled to their support. Having made these preliminary observations, he said, that he had a bundle of instances of this sort, and he only wished that a great many other persons would declare their intentions at once, and then the House would proceed to prevent the evil. He then produced a number of letters, from which he read extracts. One person wrote, that his landlord had said, "what one landlord can do, all can do, and if Lord King succeed, I will do the same." Another letter related a recent transaction in Hampshire, where a man bought an estate for 400/. and paid down 100/. of the money, and afterwards laid out se- veral hundreds of pounds upon the premises, and when the time of payment came, the seller insisted upon having payment in guineas, which the buyer could riot obtain ; the seller, however, would have it, or have his land back again, and the only consolation left to the buyer was an intimation from a friend of the seller, that he could inform him where he might following, according to your option. 1st, By payment in Guineas ; 2nd, If Guineas cannot be procured, by a payment in Portugal Gold coin, equal in weight to the number of Guineas requisite to discharge the rent; 3rd, By a payment in bank paper of a sum sufficient to purchase (at the present market price) the weight of .Standard Gold requisite to dis- charge me rent. The alteration of the value of the paper money is estimated in this manner : the price of Gold in 1802, the year of your agreement, was 4Z. an ounce. The present market price is 4Z. 14s. arising from the diminished value of Paper ; in that proportion an addition of 17 1. 10*., per cent in paper money will be required as the equivalent, for the pay- ment of rent in paper." 336 PAPER AGAINST GOLD. obtain the guineas at 27 shillings ea-ch. Another letter stated that a lady, who was a land-owner, had insisted upon her rent in gold, and that the tenant apprehended a seizure of his goods, and was ready to verify the facts if called on. Another informed him, on the part of an attorney, that the practice was become very common to sell guineas, and then pay debts with the paper. These were the grounds, stated by LORD STAN- HOPE, of the measure that he proposed ; and, upon his stating these grounds, the Ministers, who had, at the first reading, said that they did not see any necessity for the measure, or any measure of the kind, allowed that there was such necessity, and supported the second reading accordingly. Now, Gentlemen, before I offer you any observa- tions upon this measure itself, or upon the conduct of LORD KING, whose notice to his tenants seems to have given rise to it, it may not be amiss for me to say, that, from all that has ever come to my know- ledge, there is not a more disinterested man, or a truer friend to freedom and to his country, breathing, than LORD STANHOPE, whom I trace through the par- liamentary proceedings of the last twenty years, al- ways standing nobly forward in the cause of jus- tice, liberty, and humanity, and, but too often stand- ing forward alone. His protest against the Anti- Jacobin war, which began in 1793, and which has finally led to our present calamities, will live when we shall all be in our graves. He there pointed out all, yea all, that has now come to pass. That pro- test, every sentence of which is full of wisdom and of just sentiment, has these remarkable words : " Because war with France is, at present, most im- politic, extremely dangerous to our allies the Dutch, hazardous with respect to the internal peace and ex- ternal power of this country, and is likely to be highly injurious to our commerce The war may, therefore, prove to be a war against our commerce and manufactures, against the proprietors PAPER AGAINST GOLD. 337 of the funds, against our paper currency, and against every description of property in this country" How completely has all this been verified ! LORD STANHOPE was abused : he was called a jacobin and a leveller, and now the nation is tasting the bitter fruit of the spirit that dictated that abuse. Every where was he to be found, in those horrible days, where liberty was assailed. Not an act, which he deemed injurious to the rights of Englishmen, es- caped his strenuous opposition. In short, were I called upon to name the peer, whom I thought to have acted the best and truest part in those times, and for the whole course of the last twenty awful years, I should certainly name this very nobleman. You will, therefore, Gentlemen, believe that, if I dissent from the measure which he has now proposed, that dissent proceeds from my conviction, that the measure itself, is not calculated to produce that good, which I am certain its author wishes it to produce. The detail of the Bill I will not attempt to dis- cuss. Its principles are what have struck me, and these I gather from its chief provisions, which are, that, in future, the gold coins shall not be tendered or taken for more than their nominal value, and that the bank paper shall not be tendered or taken for less than its nominal value. This is LORD STAN- HOPE'S REMEDY ; and this he appears to think will prevent the possibility of a further depreciation of the paper. We have seen the cause and the pro- gress of that depreciation ; we have seen how the paper pulled down the coin along with it, till the coin could no longer endure the society ; we have seen the time and the manner of their separation; but, LORD STANHOPE appears to think, that, by the means of this Bill, he shall be able not only to re- store that harmony which formerly existed between them ; but that he shall be able to chain them toge- ther for ever after ; to bind them as it were in the bonds of marriage, and to render the ties indissoluble, If he do this, he will do what never was done before 29 338 PAPER AGAINST GOLD. in the world ; he will destroy all the settled maxims of political economy as far as they relate to finance ; his achievement will be a triumph not only over the opinions and experience of mankind, but over the very nature of man, which incessantly impels him to seek his own interest, and, at the very least, to use all the means in his power to provide for his own preservation. After having said this I shall naturally be sup- posed to be convinced, that the Bill would be utterly inefficient for the purposes it contemplates. Indeed, such is my decided opinion, and the reasons for that opinion, I will now proceed to submit to you. A guinea is not to pass for more than 21s. There must be some penalty to prevent the passing of it for more. LORD STANHOPE will propose nothing cruel ; but for argument's sake, let the penalty be death. What, then ? Why need any one risk any penalty, as far as ready money transaction goes? One 01 you goes to market with a pig for sale. " What do you ask for that pig, farmer?" Answer : " Twenty- seven shillings." " I'll give you a guinea." " You shall have him." Where is the possibility, then, of en- forcing such a law ? The parties, in any case, have only to settle, before they deal, in what sort of cur- rency payment shall be made, and then they will, of course, make the price accordingly. As to debts^ indeed, whether book debts, or debts arising from contract, in the payment of them, the gold and notes must, if this Bill pass, be taken at their nominal va- lue ; that is to say, the paper must; for, as to gold, who will be fool enough to tender gold in payment at its nominal amount, when it is notorious that it will fetch a premium of six shillings upon the guinea ? If the Bill become a law, therefore, any tenant who has rent to pay, and who has guineas in his purse, will first go and purchase paper money with his guineas, and with the paper money, he will go and pay his rent. This rent, for instance, is 105/. a year, and he has a hundred guineas in his chest. But, he PAPER AGAINST GOLD. 339 will not be fool enough to carry these to his landlord. He will go and buy 105 pounds worth of paper money with seventy-eight of his guineas ; and will then go and pay his rent, and will return home with 28 of his guineas still in his pocket. So that, as far as the Bill will have effect, it appears to me that it will bear almost exclusively upon landlords. I shall be told, perhaps, that though guineas may now be bought and sold, in consequence of the de- cision of the judges, which, in the case of DE YONGE, has been promulgated since I began this Letter,* yet we are not to suppose, that the present Bill will not provide against such traffic, by making it penal to be concerned in it. But, as I have shown * The following is the Report of this DECISION, as given by the Chief Judge, Lord Ellenborough, in the Court of King's Bench, on the 3rd instant. " THE KING against DE YONGE. Lord ELLENBOROUGH communicated the Judgment of the Court in this case, which along with another case, the King y. Wright, coming from the Assizes for the County of Buck- ingham, had been reserved for the opinion of the 12 Judges, on a point of law. Both causes had been fully and ably ar- gued before the Judges in the Court of Exchequer Chamber, and the argument had occupied a number of days. The ques- tion arising in the present case was, the Defendant having been convicted of purchasing 52 Guineas at the rate, in Bank Notes of 22s. Gd. per Guinea, whether, in so doing, he had been guilty of an offence punishable under the Act of the 5th and 6th of Edward VI. which prohibited the exchanging of coined gold for coined silver, or for gold and silver, the party giving or receiving more in value than the same was current for at the time? All the Judges," except three, were present at the whole of these arguments, and at the last of them the whole of the Judges were present. The Court had no oppor- tunity of knowing what was the opinion of the absent Judges on that part of the case at the argument on which they were not present, but they had no reason to presume that they dissented from the opinion of the other Judges who were present, all of whom concurred in opinion that the Defendant in this case was not liable under the Act of the 5th and 6th of Edward VI. The Judgment therefore, fell to be arrested; and the Judgment was arrested accordingly." Thus. then, this case is decided as I always said it must be, unless all semblance of law was banished from the land. Many people thought and said, that the conviction would be confirmed ; but, I never thought so for a moment. Oh, no ! The Judg- es knew a great deal better than to do that ! 340 PAPER AGAINST GOLD. above, men may go on with all ready money transac- tions, and, with perfect safety, make a distinction between paper and coin, which amounts to the same thing as buying and selling the coin or the paper, It will require but very little ingenuity to discover the means of so managing the matter that the land- lord shall never see a shilling's worth of coin from the hands of the tenant. But, suppose that the coin should not be permitted to be bought and sold ; does any one believe, that any law will prevent a private traffic in the article? And, if that could be done, is any one mad enough to suppose, that the guinea will still circulate at par with the paper ? Pass this Bill, or any Bill, that shall prevent men from passing the guinea for more than its nominal worth, and the consequence will be, that a guinea will never again be seen in circulation. Those who have them will keep them in their chests, waiting an occasion to export them, or more patiently waiting till circumstances have produced the repeal of the law which has driven the guinea into the hoard. The cause that we see no fuineas now in common circulation, is, as I said efore, that they cannot obtain their fair value. They would have been openly sold, long enough ago, had there not been an opinion, that the traffic was punishable by law. Now that obstacle is re- moved ; but in all likelihood, another will be erected by the present Bill. In that case, the guineas will all either be hoarded or sent out of the country, and paper must and will be made to supply their place. The Dollars, the new things of three shillings and eighteen pence, now coming out from the Bank, will also be hoarded ; and to notes for shillings and six- pences, we must come, I am convinced, in the course of the year, if this Bill pass ; so that the Bill, w^hile it will be wholly inefficient for the purpose of arrest- ing the progress of depreciation, will be efficient enough in producing a contrary effect. The Bill does not, the author of it says, make PAPER AGAINST GOLD. 341 bank notes a legal tender. It does not do it in words, but it appears to me to endeavour to do it in effect ; and that being once done, all the usual con- sequences of a legal tender must follow. It was easy to see, that the system would come to this pitch ; there is nothing in the state to which we are come, that ought to surprise any one ; what has happened, was to be expected, and was, indeed, long ago foretold ; but, what might reasonably surprise one, is, to hear this measure represented by the mi- nisters as necessary to the protection of the fund- holder : Can this be serious ! Is it possible, that they can be serious when they say this ? If they are, nothing that they say or do, can ever be a sub- ject of wonder. Men, who are capable of believing that the Bill of Lord Stanhope will operate as a protection to the fund-holder, are capable but, really, I want words to answer my purpose. Imagination can frame nothing that such men are not capable of in the way of belief. That the paper would, at last, become a legal tender, or forced cir- culation, it was easy to see. I did, indeed, for my own part, expect this state of the paper to be appa- rent long ago. The faith of this "most thinking people," I knew to be almost passing conception; but, still I did not think it adequate to the support- ing of this paper-money for 14 years after the issuers had ceased to pay in cash, and after they were pro- tected by law against the demands of their creditors. It was, however, certain, that the thing must come to this point at last ; it was certain, that, if the Na- tional Debt and the taxes continued to increase, the time must come when landlords would see that they must either starve, or demand their rents in coin ; and, whenever this time came, it was, as I have ma- ny times said, impossible to keep up the paper only for six months, without making that paper a legal tender, which might eke out its existence, perhaps for a year or two, but which, in the end, must insure its total destruction. I have several times been ask- 29* 342 PAPER AGAINST GOLD. ed, what reason there was why landlords should not demand their rents in gold and silver; or in bank notes to the amount of the gold and silver ; and, my answer has always been, that there was no reason at all against it now, but that there soon would be ; for that the moment such demand was made, Bank notes would be made a legal tender. This was na- tural, and, therefore, the ministers are now doing just what I always expected they would do, whene- ver any land-holder did what Lord King has now done ; but, to hear them speak of it as a measure calculated to afford protection to the fund-holder, is what I never could have expected. They will see what sort of protection it will give him ; and he will feel it ! What will be his fate, I shall not pre- tend to say ; but, I hope, there is justice enough yet in the country, real justice enough, to prevent him from perishing, while there exist the means of such prevention. I trust, that his claims will meet with serious and patient consideration; that the question of what is due to him, and to whom he ought to look for payment, will be settled upon sound prin- ciples of equity. I am for giving real protection to the fund-holder ; but, to hear the Ministers say, that he is to meet with protection from a measure such as that now before Parliament, a measure that must inevitably accelerate the depreciation of the paper, is, surely, sufficient to fill one with surprise and dismay, if, at this day, and after all that we have seen, any thing ought to produce such an effect in our minds. On the 2nd of July, a protest was entered in the House of Lords, against Lord STANHOPE'S Bill, which protest I here insert. " Dissentient, because we think it the duty of this House to mark, in the first instance, with the most decided reprobation, a Bill, which, in our judgment, manifestly leads to the introduction of laws, imposing upon the country the compulsory circulation of a Paper Currency ; a measure fraught with injustice^ destructive of all confidence in the legal security of contracts, and, as PAPER AGAINST GOLD. 343 invariable experience has shown, necessarily pro- ductive of the most fatal calamities: GRENVILLE, LANSDOWNE, JERSEY, KING, ESSEX, COWPER, GREY, LAUDERDALE. " For the reason assigned on the other side, and because the repeal of the law for suspending Bank Payments in cash, is, in my judgment, the only mea- sure which can cure the inconveniences already felt, and avert the yet greater calamities which are impending from the present state of the circulation of the country : VASSALL HOLLAND." In the protest of the eight peers I heartily concur j but, I do not agree with LORD HOLLAND in his addi- tion to it, if his lordship means to say, that it is pos- sible to resume cash payments at the Bank. To pay the notes in gold upon demand, agreeably to the promise upon the face of the notes, is certainly the only cure for the inconveniencies already felt and the calamities now impending ; but, that it is utterly impossible to adopt this cure is, to my mind, not less certain. His Lordship proceeds upon the motion of Mr. HORNER and the Bullion Committee, namely, that the case of the depreciation consists in an ex- cessive issue of paper, which is very true, if you compare the quantity of paper with that of the gold, or of the real transactions of purchase and sale, be- tween man and man; but, which is not true, if you compare the quantity of paper, with the amount of the Dividends payable on the National Debt, and I would be^ leave to put, with sincere respect, this question to LORD HOLLAND: "If cash payments were restored, and money, as must be the case, were restored to its former value, where does your Lord- ship think would be found the means of paying the Dividends ?" It is impossible ! The thing never can go back without combustion ; no, not an inch ; nay, and it musi keep advancing. This very measure, by has- tening the depreciation, will cause a new addition, and still larger than former additions, to the Nation- -344 PAPER AGAINST GOLD. al Debt, and of course to the Dividends. Those additional Dividends must be paid in an additional quantity of bank notes ; and thus the system must go on, as PAINE foretold, with an accelerated veto- city, until it can go on no longer. Having this opi- nion so firmly fixed in my mind, I was quite sur- prised to see the Marquis of LANSDOWNE endeavour to mend the Bill of LORD STANHOPE by the intro- duction of a clause for prohibiting the Bank Com- pany from augmenting the quantity of their paper after the passing of the Bill. This shows, that his Lordship has, what I deem to be, and which, I think, I have proved to be, a most erroneous view of the real cause of the depreciation. If he thought with me, that the cause is in the increase of the National Debt and of the Dividends, he would have proposed no such amendment as this. As to the conduct of LORD KING, nothing could be more fair or more laudable. He wished to take no advantages of his tenants ; he only wanted a fulfilment of his contract with them ; and, as the spirit of the contract was more favourable to them than the letter, he abandoned the letter, and only re- quired them to hold to the spirit. To hear him, therefore, charged with oppression^ and by ! But, it is as well to keep ourselves cool. Let others chafe and foam. And. if the House of Lords do choose thus to determine, why, all that I can say about the matter, is, that they are the best judges whether they stand in need of their rents, and, if they do not, I really do not see much harm in their giving them to their tenants ; and, this act will be the more generous as they are about to do it by law, so that the tenants will keep the rents without having to give the landlords even thanks in return. TJiat such will be amongst the effects of the Bill, if it pass, there can be no doubt ; and, as far as it ope- rates in this way, a most popular Bill it will be. It will act as a distributor of wealth ; of money, lands, and tenements ; for, to suppose, that, in many PAPER AGAINST GOLD. 345 cases, the tenants will not soon become the proprie- tors^ is to discover but very little thought on the subject 5 and that, I am sure, would be a shame in a body of HEREDITARY LEGISLATORS in the " most thinking nation in the world." What a change this will make ! Happy is the man who is a tenant I Much better off is he than the man who tills his own land ; because the former has given nothing at all for his, whereas the latter has paid, at some time or other, purchase money for what he possesses. The letting of long- leases is out of fashion ; but, in ge- neral, the lands of great proprietors are held upon lease, and these leases are not, upon an average, for less than seven years at the lowest. Some of these leases are nearly expired, of course, but others will naturally be but just commenced. So that, the ave- rage time, for which the land is now let, I shall take at three years and a half. All the Duke of Bed- ford's estates, for instance, are let, then, for three years and a half yet to come. Now, if the paper depreciates three or four times as fast as it has hi- therto done, the tenants of the Duke of Bedford will have a brave time of it for these three years and a half. But, if the Bill, which is now before Parlia- ment, should send down the paper to the state of the French assignats in 1794, what will^ in that case y be the situation of the Duke of Bedford? There are many landlords, who cannot hold out for three years and a half, and who, therefore, must sell, in whole or in part ; but there will, indeed, be this con- venience, that they will every where find a pur- chaser ready at hand in their tenant, and one, too, who will not only know the real value of the pro- perty, but who will have the money ready to pay for it. This is nothing in the way of a joke. I am in earnest ; it is what I am convinced will take place, if the Bill of Lord Stanhope pass into a law ; but, as I said before, if the Lords like it, nobody else can possibly have a right to interfere. They may, sure- ly, do what they please with their own property. All 346 PAPER AGAINST GOLD. that I wish to stipulate for is, that we Jacobins and Levellers shall never be accused of this act of dis- tributing the lands and houses of the rich amongst those who are not rich ; that we shall not be accused of this great act of pulling down, and raising up. Hume remarked, that the funding system, in the space of 500 years, would cause the posterity of those now in the coaches, and of those upon the boxes, to change places ; but, if this bill of LORD STANHOPE pass, this change will be a thing of much quicker operation. I shall be told, that Lord King's example would have operated even more quickly than this measure, in destroying the paper. Granted. It would, there is no doubt, have produced, in a very short time, that which must have totally destroyed the paper sys- tem, root and branch, namely, TWO PRICES, against which, openly and generally adopted, no Eaper-money ever did, or ever can, stand for any >ngth of time. That that example would have been generally, nay universally, followed, there can be no doubt at all, for, no man voluntarily gives away his rents, or, rather, lets another withhold them from him. Some persons would have been a little shy at first ; but, when they found that others did it, they would have got over their shyness, and the de- mand would have been universally made. Thus, then, the TWO PRICES would have been estab- lished ; and the gold and silver, finding that they could pass current for their real worth, would have come forth from their hiding places, some, while the rest would have hastened back from abroad. " Surely !" say you : " why then, are the Government alarmed at the effect of Lord King's example, if it would bring back gold and silver into circulation?" Oh! there is good reason for their alarm ; for, observe, THE TAXES WOULD CONTINUE TO BE PAID IN PAPER ! When the tax-gatherer come to the door of one of you, for instance, you would, if you had only gold or silver in the house, beg him tu PAPER AGAINST GOLD, 347 call the next morning, or to sit down a bit, while you, with your gold, would go and purchase paper-money sufficient to pay him the amount of his demand ! There needs no more to convince you that the Government has good reason for alarm at the prospect of seeing Lord King's example followed, as it assuredly would be, if there were no law to prevent it. In short, that example would annihilate the paper system in a year. The next Letter will close the series. In the mean while, I remain, Gentlemen y Your Friend, WM. COBBETT. State Prison, Newgate, Friday, ffl, July, 1811. LETTER XXVI. " It is not that the nionei/ which the Public Creditor receives, as interest for his capital, is less than it used to be ; it is that the quantity of goods he receives tor his money is less ; and he will be still receiving less and less, while your taxes will be rising more and more. If the next Admi- nistration" (Addington was just at this time coming into power in p ace of Pitt) "mean to go on like the last, it would be a good thing for the country if no man would lend them a groat. Let them ta~:e three fourths of a man's int-rr^st, or property, from him, and take off the taxes, and the people would be doubly gainers. If you reduce the National Debt, we may laugh and sing at home, and bid defiance to all the world ; if you do not reduce it, the consequence will be, that, instead of paying the Na- tional Creditor 120 quartern loaves for a years interest of his loot, you will go on. till you only pay him 2 or 3 quartern loaves. Depend upon it that it will be the fate of the National Creditor." Mr. Home Tooke'9 Speech, in the House of Commons, 2d March, 1801. Mr. Home Tooke and the Reformers Effect of Lord King's Example Two prices How these would affect the Go- vernment, the Generals, the Judges, the Sinecure Place- men and Pensioners Lord Mornington's Speech in 1794 Progress of the Assignats in France Mr. Perceval's Speech in the House of Commons, 6th July, 1811. GENTLEMEN, LOOK at the motto ! Look at the motto ; and, es- pecially, if any of you should unfortunately be fund- holders ! in that case, let me beseech you to look at 348 PAPER AGAINST GOLD. the motto. They are the words of a very wise man. They were spoken, you see, rather more than ten years ago. The speaker was laughed at by some, and railed at by others ; but, I imagine, that, at this time, those, who then laughed, are more disposed to cry, though I by no means suppose, that the railers have ceased, or ever will cease their railing, as long as they have tongues or pens wherewith to rail. The House of Commons passed an Act which, for the future, excluded Mr. Tooke, soon after he made this speech. They did so upon the ground of his being a Clergyman in Holy Orders. No matter : they got rid of him for the future ; but, they have not got rid of the event that he foretold. Oh, no ! that is coming upon them in spite of all their triumphs over Mr. TOOKE, and Mr. PAINE, and Messrs. Mum, PALMER, MARGAROT, GERALD, WINTERBOTTOM, GILBERT WAKE- FIELD, and many others. The Government beat all these reformers ; they not only put them down ; they not only ruined the greater part of them ; but they succeeded in making the nation believe that such ruin was just. Well! The Government and the nation will now, of course, not pretend, that the pre- sent events have sprung from the Jacobins and Re- formers. Mr. TOOKE told them to reduce the Na- tional Debt. They rejected his advice. They des- pised his warning. They kept him, for the future, out of Parliament. Well ! Let them, then, not blame him for what has since happened, and what is now coming to pass. I beg you, Gentlemen, to reflect well on these observations ; for, such reflection will be very useful in preventing you from being deceived in future, and will enable you, when the utmost of the evil comes, to ascertain who are the men who have been THE AUTHORS OF THE EVIL, arid to whom, ac- cordingly, you ought to look for a just RESPONSI- BILITY. But, upon this vital part of the subject I have some hints to offer to you hereafter : at pre- sent I must return for a while, to the point where I PAPER AGAINST GOLD. 349 broke off in my last Letter, namely, the reason for the alarm of the Government at the prospect of see- ing Lord King's example followed. I spoke of the TWO PRICES before ; but, let me say a few more words upon that very interesting part of our subject. Two prices have always proved the death of paper-money. In this case it would have been the same, and, in the end, it will still be the same ; for, the Bill of Lord Stanhope can do no more than retard the event for six or nine months, and mind, I tell you this with as much confidence as I would venture to foretel the arrival of Christmas day. I do not say, that the event will come in six or nine months ; but I say, that this Bill will not keep it off for a greater length of time than that. If TWO PRICES were generally made, we should see the gold and silver back into circulation immedi- ately ; but, none of it could get to the Bank, because no man would pay his TAXES in gold and silver. Consequently the fund-holder and the Government would be paid in paper, while gold and silver would be circulating amongst all the rest of the community. As soon as there are two prices, the paper must de- preciate at an enormous rate ; and as the Govern- ment would have to pay its contractors and others whose pay was not fixed, in this depreciated paper, it must have a greater quantity of that paper, and it must come from the Bank. It is so easy to see how this must work ; how rapidly it must go on ; how soon it must render the paper worth little more than its weight in rags j all this is so easy to see, that I will not suppose any one of you so very dull as not to perceive it. The Government, with nothing but paper at its command, would soon begin to feel somewhat like a person who has taken a powerful emetic. The big round drops of sweat would stand upon its forehead ; its knees would knock together ; it would look pale as a ghost ; an universal feebleness would seize it. That to say, all this would take place, if the Govern- 30 350 PAPER AGAINST GOLD. ment persevered in the Pitt system, and that it would do so, who can doubt after what we have seen during the last twenty years. If the TWO PRICES were openly made, and became general, as they, in all probability, would, in the course of six or eight months, the paper would fall so low as that 5, or, jvernrnent, its way ; the Generals and Judges and others, having a fixed pay, would, indeed, still be paid as they were before, and, of course, the Government would lose nothing by taking paper as far as this description of expense went ; for, you will observe, that I hold it to be impossible, that the parties I have just men- tioned, namely, the Generals, the Judges, the Tax- Commissioners, and the like ; I hold it to be impos- sible, that these men should not all of them be ex- cessively happy to take the paper-money, though at a hundred for one, seeing that the greater the degree of depreciation, the finer the opportunity for them to give proofs of their devotion to public credit. But, though my Lords the Judges, and Lord Arden and Lord Buckinghamshire and Lord Liverpool and Lord Bathurst and the Marquis of Buckingham and Lord Camden and Old George Rose and Mr. Canning and my neighbour the Apothecary General and Lord Kenyon and Lady Louisa Paget, and, indeed, the hundreds of those who h&ve fixed sums paid them by the Government out of money raised upon the peo- ple, whether in the shape of salary, sinecure, or pen- sion ; though all these persons would, I dare say, from motives of public spirit, cheerfully continue to take the paper till a pound of it would not purchase a pinch of snuff; still, there would be some things and some services that must be paid for in money, or they would not be obtained. Beef and Pork and Biscuit could not be bought without real money. These are commodities that do not move without an equivalent. Whether the soldiers would be paid, PAPER AGAINST GOLD. 351 under such circumstances, in paper so much reduced in value, I shall not pretend to say, and will leave the point to be settled by those who have lately said so much about this useful and numerous class of ac- tive citizens. But, one thing is certain : that THEY must be paid in a kind of money that will purchase eatables. They have bargained to receive a certain sum per day; and, if the same should not purchase half so much beer or beef as it does now, the bar- gain will not be so good a one as it is now ; though, observe, I am not supposing, that there would not be found public spirit enough amongst the soldiers to make them take the paper in preference to gold. At any rate, this is a matter which belongs exclusively to those who have the management of our affairs, and who are paid very well for such management. It would be useless to extend our remarks here. It is as clear as day-light, that whenever TWO PRICES shall be generally established, the death of the paper is at hand, and indeed, the death of the funding system; because, owing to the rapidity of the depreciation, the fund-holders, our poor friend GRIZZLE GREENHORN, and all the rest of them, would soon be in the situation described by Mr. HORNE TOOKE, in the passage taken for my motto ; that is to say, a hundred pounds of their stock would yield them a couple or three quartern loaves in the year; and, it is within the compass of possibility, that many persons, who are now enabled to ride in their coaches by incomes derived from the funds, may end their days as paupers or beggars. In short, it is quite impossible for any man of common sense not to per- ceive, that the establishment of TWO PRICES would put an end, in a short time, not only to the property of the fund-holders, but to the sinecures and pensions, and also to great numbers of other emoluments derived from the public revenue. Put an end to all for a time at least, and subjecting them to an after revision. If we are of opinion 3 that this effect would have 352 PAPER AGAINST GOLD. been produced by tbe example of Lord King being followed, there is, I think, little room for wonder, that the ministers were alarmed at the prospect. I know it will be said, and with perfect truth, that, in time, the same effect will be produced by Lord Stan- hope's Bill ; but, supposing it to be produced full as soon by the Bill, it does not follow, that the minis- ters perceive that. On the contrary, it would seem, that they do not perceive it at all ; and, it is evident, that they have a sort of vague notion, that the Bill will stay the depreciation. I am convinced, that it will not; I am convinced, that it will hasten the de- preciation, and though not quite so fast as the exam- ple of Lord King would, still that, in the end, the effect will be the same. But the ministers could, in the one case, see the effect ; in the other they appear not to have seen it ; and, this is quite sufficient to account for their giving their support to the Bill. I said before, Gentlemen, that this Bill was the first of a series of measures, the object of which would be to keep up the paper by the force of law. This seems to be the opinion of all those who have opposed it in the House of Peers : that it is merely a step in the old beaten path of keeping up, by the arm of power, a depreciated paper-currency. This course has been before pursued, in other countries, and it has, in every part of the world, led to the same end ; the total destruction of the paper. Each ot the Colonies, now moulded into an united nation in America, had its debt, its paper-money, its legal tenders, and its public bankruptcy, before their se- paration from England, and even before the revolu tionary quarrel began. But, it was in France, where the thing was performed upon a grand scale ; and, by taking a view somewhat more close than we have hitherto done, of the progress of the measures in France, we shall be able more correctly to judge of the tendency of what is now going on here. There are divers histories of what was done in France, relative to the assignats; but I choose to PAPER AGAINST GOLD. 353 take for my authority one of the present Ministers. The Marquis WELLESLEY, when he was Lord MORN- INGTON, made a speech in the House of Commons, which was afterwards published in a pamphlet, or rather book, in which he gave an account of all the pranks played with the assignats in France, up to the time of his making the speech, which was on the 21st of January. 1794, just three years and a month before the then ministry, whom he supported, issued an Order in Council to protect the Bank of England against the demands of cash for their notes. In this memorable speech, manifestly drawn up for the purpose of exciting horror in the people of England at the wickedness of the French Rulers re- lative to the assignats, and also to make the people believe, that the state of the assignats must prove the overthrow of France ; in this memorable speech, not only facts are stated, but principles and maxims of finance are laid down. We will take a cursory view of them all ; for time, which tries every thing, has now brought us into a state to judge correctly of those facts, principles, and maxims. Lord Wellesley told the House of Commons, that the rulers of France were very wicked, but that they were not less foolish, than wicked ; that their igno- rance was, at least, equal to their villany, though the latter was surprisingly great. He said, that " the French Revolutionary Government, in order to sup- ply an extravagant expenditure, had recourse, at first, to increasing the mass of paper-money ; and, that they declared, that they had no other means oj sustaining the pressure of the war, than by the creation of an additional quantity of assignats." There, is then, nothing original in the declarations of Lord Liverpool, and Perceval and Rose. Nothing new in their recent assertions, that it was the paper- money that enabled them to provide for the defence of the kingdom, to make such great exertions against the " enemy of the human race," to gain such victo- ries in Spain and Portugal, and to add such glories 30 354 PAPER AGAINST GOLD. to the English name ! This was all very fine and full of comfort ; but, as you now see, Gentlemen, there was nothing new in it. The same thing had been said before by the revolutionary rulers of France ; the same thing had been said by Danton and Robespierre and their associates, in praise of the revolutionary money of France. The ministers have frequently denied that the coin of the country is, or ought to be, the standard of value. Rose and Lord Westmoreland, and several others of them, have denied, that the Bank notes ought to be looked upon as depreciated, merely because they would not go for the same quantity of gold as for- merly ; and the hireling writers have taken infinite pains to decry and run down the gold and silver coin. One of them calls guineas an incumbrance; another says, that gold and silver are merely articles of traffic, and that the Bank notes are the only money fitting the country ; another has said, that, were it not for the National Debt, the patronage, and the paper-money, the Government could have no existence, and that the Bank notes offer to the government a most indestructible support, because they make the daily bread of every individual de- pend upon the Government ; and another has said, that Bank paper is the best bond of individual and public security, and the only medium of currency to suit and exert the energies of an insular and com- mercial people ! What a similarity between this language and the language of the Rulers of France in favour of their assi gnats ! They called them, as Lord Wellesley said in his speech, revolutionary money ; their Chan- cellor of the Exchequer said, that it was a happy thing for the people to have Republican assi gnats instead of pieces of metal bearing the effigy of ty- rants ; that the whole nation despised the corrupt- ing metals, and that he would soon find a way of driving back the vile dung into the bowels of the earth. In another part of his speech, Lord Welles- I^H . 11 .1 PAPER AGAINST GOLD. - 355 ley tells us, that people were imprisoned and pun- ished for their contempt of assignats. Nevertheless, the people of France had, it seems, still an unnatural hankering after gold and silver in preference to assignats ; and they did, in fact, make TWO PRICES ; the consequence of which was an enormous rise in the price of all the necessaries of life, the proprietors of which were reviled as ene- mies of the country, and, as such, many hundreds of them were put to death. This, however, was not sufficient to put a stop to the rise of prices, and, in- deed, did not check it at all. Then came the law of of MAXIMUM, (as it will in England if the present course be pursued,) fixing the highest price at which any of the necessaries of life should be sold, and at which men should work and render services. This terrible law, Lord Wellesley tells us, had nearly- starved the whole nation ; for the farmers would not bring their produce to market, and tradesmen kept their goods locked up. Then, he tells us, that these persons were pursued as monopolists ; and thus, said Lord Wellesley, " every farmer whose barns and gra- naries are not empty ; every merchant and tradesman whose warehouse or shop is not entirely unprovided with goods, must be subject to the charge of mono- poly. This crime is punished differently, accord- ing to the enormity of the case ; but, most frequently the punishment is death." So that it is time for far- mers and tradesmen to look about them, and espe- cially the farmers ; who, if they do not already see the danger of their landlord's property being with- held from him, will, perhaps be more clear-sighted when their own natural fate is pointed out. They hear LORD KING accused of black malignity ; they hear him charged with selfishness ; they hear him classed along with pedlers and Jews. This was, as Lord Wellesley tells us, precisely the language which Danton and Robespierre and their underlings made use of towards the people of property in France, who had a " contempt for assignats.'' They were 356 PAPER AGAINST GOLD. accused of incivism ; they were called egotist, and were, in almost the very words in which LORD KING is now arraigned by the COURIER, told that they " committed a robbery against the RIGHTS OF SOCIETY!" And, this is what the people or England are told, observe, after eighteen years of war, after eighteen years of blood and taxation, in order, as they were promised, to preserve their coun- try from what they saw going on in France ! " But our paper is at par," say some of the PITT- ITES still ; " Our paper is not depreciated." So they said in France. Yes, said Lord WELLESLEY, " the French minister of Finance has boasted, that his as- signats are at par ; but, the laws which have been passed for punishing with long imprisonment any person who takes, gives, or offers assignats under par, sufficiently account for this circumstance." Good God ! It would really seem, that every saying is to come home to us ! that upon our devoted heads are to be visited all that was felt, and, which is more, perhaps, all that was, by our rulers, said to be felt, by the people of France : aye, it really would seem, that all, that all, to the very letter, is now to come home to the people of England, who were led to build their hopes of success and of safety upon the ruin of the people, or at least, the Government of France ! This very Bill now under discussion, will impose a penalty, whether of imprisonment or not I do not yet know, upon any person, who takes, or gives, or offers, bank notes under par. The prohi- bition was made in the Lords, and the Minister has said, that he means to add the penalty ! Let us now look, then, at the contrast which Lord WELLESLEY drew, upon that memorable occa- sion, between the situation of England and that of France. " From this disgusting scene," said he. " let us turn our eyes to our own situation. Here the contrast is striking in all its parts. Here we see nothing of the character and genius of ARBI- TRARY FINANCE; none of the bold frauds of PAPER AGAINST GOLD. 357 bankrupt power : none of the wild struggles and plunges of despotism in distress ; no lopping off from the capital of the debt ; no suspension of interest ; no robbery under the name of loan ; NO RAISING THE VALUE, no DEBASING THE SUB- STANCE of THE COIN. Here we behold pub- lic credit, of every description, rising under all the disadvantages of a general war; an ample revenue, flowing /reefy and copiously from the opulence of a contented people." Gentlemen, read this with attention ; and, when you have so done, draw yourselves the contrast which the situation of England now presents with that of France ! It is a fact perfectly notorious, that there is no such thing as paper money in France ; it is also notorious, that not only does France abound in gold coin, but that the coin of this country, the guineas of England, are now gone and are daily going to France ; aye, to that same country, which was to be ruined and overcome and subdued by the failure of its finance ! This speech of Lord Welles- ley, and all the numerous other speeches of the same description, were intended for the purpose of gaining the people's concurrence to the prosecution of the Anti-Jacobin war, which war, by adding Jive hun- dred millions sterling to our Debt, has produed the fruit of which we are now about to taste. Year after year the same means were made use of for the same purpose, and with similar success. At the opening of the Session of Parliament, in October, 1796, PITT himself told the Honourable House, that, in his conscience, he believed, that, with finan- ces so dilapidated, the French would not be able to stand out another campaign ! " This DEPRE- CIATION of the Assignats," said he, " is so severely felt, that it has been repeatedly admitted, that means must be found to employ resources less wasteful. This principle has been recognised by every finan- cier or statesman. Even at the period when the de- preciation was only one half, it was declared, that 358 PAPER AGAINST GOLD. unless some immediate remedy was applied, they would be unable to maintain their armies. Months have since elapsed, and no substitute has been em- ployed. Resources thus strained to their utmost fitch, and incapable of any renovation, must have in themselves the seeds of decay, and the cause of inevitable dissolution" This, Gentlemen, was PITT'S reasoning as applied to France. Little did that presumptuous and shal- low man dream that, in less than four months from that very day, he was doomed to come into that same House of Commons, and from the same spot where he then stood, announce that the Bank of England was no longer able to pay its notes in the coin of the realm, and that he had been guilty of a violation of the law in issuing an order of Council to guarantee the Bank Company against the consequences of re- fusing to pay the debts due to their creditors ! J3ut, as if this were not enough, he must, in the speech just referred to, comment upon certain metallic money then, it was said, about to be issued in France. " Metallic pieces," said he, " are, it seems, to be put in circulation ; but it is not said, whether these are to be of the DENOMINATED VALUE : if not so they are only METALLIC ASSIGNATS !" Yet this same minister, who has been impudently called "the great Statesman now no more," had, in a short time afterwards, to propose to this same House cf Commons, to sanction the issuing of Dollars at 4s. and 9rf. the real value of which was 4s. %d. ; he lived long enough to propose to the same House of Commons, to give its sanction to an issue of dollars at 5s. ; if he had lived till now, (I always regret that he did not !) he would have seen the Dollar at 5s. Qd. And, what he would have seen it at, if he had lived till a few years hence, I must leave TIME, the trier of all things, the rewarder of all good deeds, and the avenger of all injuries, to say. You will now be able to judge how far our situa- tion, in respect to paper-money, resembles that of PAPER AGAINST GOLD. 359 France at the time when the revolutionary rulers of that country were endeavouring to keep up the Assig- nats by the arm of the law, by the terrors of the jail and the guillotine. Mr. PERCEVAL says, that there is ?io resemblance whatever between the bank notes and the assignats. I shall show you, that Mr. Per- ceval is deceived ; that he does not understand this matter ; and that, if he had read the works of PAINE, at the time when his colleague Lord Eldon (then Attorney General) was prosecuting the author, he would not have hazarded any such assertion. But, we must now take a look at the whole of this speech of Mr. Perceval. I mean his speech in the House of Commons, on Tuesday last, the 9th in- stant, upon the first reading of Lord Stanhope's Bill in the House of Commons. This speech will be a memorable one. The child yet unborn will have cause to think of this speech, and of the series of measures, of which, as appears to me, it is the ne- cessary forerunner. Mr. Perceval (I have the report of his speech as given in the COURIER) began by stating his reasons for having come round to the support of Lord Stan- hope's Bill, after having, at first, disapproved of it. He says, that he, at first, thought it unnecessary, because he did not think, that any body would fol- low the example of Lord King ; but, that finding that it was likely that the example would be followed, he then thought it necessary to support the bill. Thus, then, at any rate, it has been one individual who has caused this Bill ; the Bill is made for the purpose of preventing that individual and others from obtaining in payment of rent what the law now authorizes them to demand ; it is a Bill, in fact, which, against the will of one of the parties at least, alters contracts made years ago. Yes, says Mr. Perceval, it does so; but,' the same was done in 1797 ! That is the answer. Because the thing was done by Pitt, he may do it ! He said, that, until now, this preference for coin before paper had been 360 PAPER AGAINST GOLD. shown by none but Pedlers^ Jews, and Smugglers ; and, in speaking, afterwards, about the possibility of the Bill being inefficient, and a legal tender being necessary, he said that, u he did, however, hope, that the ODIUM attaching to the conduct which gave rise to this Bill, WOULD PREVENT OTHERS FROM FOLLOWING THE EXAMPLE." These are memorable words, especially considering from whom they came. Aye, aye ! I know well what workings of mind there must have been before they were uttered. I would not have such workings in my mind for ten times the worth of the reversion of Lord Arden's sinecure. Oh ! a time is coming, when all these things will be seen and felt as they ought to be. But, let us return to this memorable expression, " the ODIUM !" A man, then, is, it seems, to incur odium if he demands his due ; his due in equity as well as in law ! Gentlemen, you are, for the most part, tenants ; but, take care how you suffer your- selves to be led to wish for any advantage from this Bill, which will most assuredly operate, in the end, to your injury, and, perhaps, to your utter ruin. Let me explain to you, a little more fully than I have hitherto done, the nature of Lord King's demand upon his tenants. He let a farm, for instance, in 1802, to JOHN STILES for 100 a year, in good and lawful money of the realm. He has until now, continued to take the 100 a year in bank notes ; but now he finds, that those notes are so far from being good and lawful money of the realm, that they have sunk in value 20 per centum, and that in- stead of 100 he would, in effect, get only 80. If, however, the thing was likely to stop where it is, he might possibly go on receiving paper to the end of the present leases, when he would take care to raise his rent of course ; but, the thing is not likely to stop ; it goes regularly on ; gold is purchased up ; a guinea sells for 275. 6d. And is it not, then, time for Lord King to begin to protect himself against PAPER AGAINST GOLD. 361 this depreciation ? JOHN STILES, you see, suffers no hardship in this, because he raises the price of his corn and cattle to meet the effects of the deprecia- tion. Suppose, for instance, that the paper has de- preciated 20 per centum, or five pounds in every twenty, since 1805 ; and suppose, that wheat is now 25 pounds a load ; consequently, it will require only four loads of wheat to pay 100 now, but it must have required Jive loads to pay 100 in 1802. But, is it not just and fair, that JOHN STILES should give Lord King as much wheat for his rent in 1811 as he contracted to give him in 1802 ? If he does not do this, and if the paper go on depreciating, may it not come to pass, that JOHN STILES will not give Lord King more than a bushel of wheat in a year? Aye, may it ; and a great deal sooner too than many persons seem to imagine. And, because Lord King wishes to avoid this ruin, is he to be lumped along with Jews, pedlers, and smugglers, and are we to be told of the odium attaching to his con- duct ? However, upon this head, I shall always say, for my part, that the Lords are the best judges of whether they or their tenants are likely to make the best use of the rents ; and, if they like to give the rents to the tenants, I know of no one who has any right to find fault with them. They and the other great land-owners appear to have abundant confidence in Mr. Perceval, in the Bank, and in the East India Company ; and the Clergy appear to have equal confidence in them. Well, then ; I really see no good reason that we, the people in general, have to find fault with what is going on. The mat- ter seems, I think, to lie wholly between the land- owners and this little sharp gentleman and his col- leagues ; and to them I will leave it, being quite satis- fied, that the former are now about enjoying the just reward of their conduct for the last twenty-six years. Mr. Perceval said, that those who supported the Bank Restriction Act in 1797, were inconsistent in not supporting this Bill ; and he talked a great deal 31 3b2 PAPER AGAINST GOLD. about the inconsistency of those who proposed, the other day, to continue the Restriction lor two years longer. With these matters, Gentlemen, WK have nothing to do. The affair is all their own. THEY made the war that produced the loans that produced the paper that produced the run that produced the stoppage of cash payments that produced the de- preciation that produced the sale of guineas and thi'. hoarding and exportation of them. THEIR work the whole of it is, and which set of them were first at it, or which last, is of no consequence to us. They have it all amongst them. They chose the grounds of war, and the time for beginning ; they put down all those who opposed them ; they have been, for twenty-six years, the rulers of the country and the masters of all its resources. One set, there- fore, is and ought to be, just the same as the other in the eyes of the people. Let them settle the mat- ter of precedence between them ; let them bail one another as long as they please; but let not us be, by such baiting, amused and drawn away from the great points ;tt issue. The " object of the Bill," Mr. Perceval said, "was to prevent the establishment of TWO PRICES, which must be the case if Lord King's example were generally followed." Now, you will be so good as to bear in rnind, Gentlemen, that this is, Mr. Perceval says, the object of the Bill ; and, I beg you also to bear in mind, that I say, that in this object the Bill will fail. Here we are, then, I and the Minister, foot to foot in opposition. I say his scheme will not prevent the TWO PRICES. I say it will not: he says that such is its object: we shall sec who is right. He ought to be ; for, I am sure, he is paid money enough for thinking for this most think- ing people in the world. He did, however, confess, that it was possible, that this Bill might not be effi- cient ; and, what was then to be done? W T hy, the bank notes, he said, must, in that case, he. made a legal tender I Bravo ! Come : toU again ! Once PAPER AGAINST GOLD. 363 more, and then comes the maximum! I always said, that it would be thus. I always said, that the moment any one put the paper money to the test, the paper money would be made a legal tender. This Bill it was (but I do not believe it now is) be- lieved would have the same effect ; but, if it fail of that effect, then the legal tender is, it seems, to come. Mr. Perceval says, that this may become neces- sary. For what, Mr. Perceval 1 What may it be- come necessary for ? Necessary to do what, thou Minister of Finance ? Why, you will say, I sup- pose, to prevent TWO PRICES, and to PRO- TECT THE FUNDHOLDER. And, dost thou really think ; dost thou, a disciple of the great statesman now no more, think, in good earnest, that a legal tender law would prevent two prices and protect the fundholder ? Forgive me, but it is im- possible for me to refrain from laughing at the idea. You will say, I suppose, that it is " no laughing matter." Cry then, if you like, but I will not ; nor will any one belonging to me. But, how is the le- gal tender to prevent TWO PRICES being made? An Act of Parliament making the bank notes a le- gal tender, would cause debts to be paid in paper ; but it could not make the butcher or the baker give their meat or bread for bank notes. They would and they must and they will have two prices ; a money price, and a paper price ; and this will be- come general in spite of every thing that can be done to oppose it. What protection then, will the fundholder, or, "public creditor" as he is called, derive from measures like these ? Mr. Perceval sup- poses a case (of which I will say more by-and-by) in which the lundholder of 6,000 capital rents a house of 300 a year, and says that it would be ex- tremely hard, if this man, who is obliged to receive his 300 a year from the Government in paper, were to be left exposed to the compulsion of paying his 300 a year rent in gold. Where is the hard- 364 PAPER AGAINST GOLD. ship, if bank notes are as good as gold? Where is the hardship, if the notes have not depreciated ? And these assertions are daily and hourly made. But, to return to the baker and butcher, for these are the lads that it will be most difficult to manage ; what will this fundholder do with them? How will Mr. Perceval protect him against them ? Why, to be sure, he will, and indeed, consistently, he must, have recourse to maximum. And, it may not be amiss here to explain to you, farmers and trades- men, what a maximum means ; for, you will find it a matter in which you are very deeply interested. They had a maximum in France, in the times of depreciated paper money. The rulers of that day, finding the assignats depreciate very fast, passed a law to put a stop to the depreciation, which only made them depreciate the faster ; and, as the as- signats were bought and sold, as our bank paper now is, they passed another law to prevent the gold from passing for more than its nominal worth, and to prevent the paper to pass for less than its nominal worth. This object, though attempted to be accom- plished by the means of very severe penalties, was not accomplished. There was still a money price and paper price ; for when a man went to market, he pulled out his paper, or his coin, and the article was high or low priced accordingly. If the thing to be bought was a quarter of mutton, for instance, a crown piece in silver might be the price ; but, if the payment was to be made with paper, then the price might be ten pounds or fifty pounds, perhaps. The next thing, therefore, was to prohibit the use of coin altogether. But this did not answer the purpose. The assignats still keep depreciating, and the rate of depreciation kept on increasing, till, at last, it required a hundred pounds to purchase a pair of common shoes; and this was not at all wonderful ; for, when once a paper money is got into an acknowledged and notorious depreciation, it always goes on with accelerated velocity. Well, what w PAPER AGAINST GOLD. 365 dial was now to be done ? If it took a hundred pounds to purchase a pair of common shoes, what - was the use of collecting taxes in such money ? And what was to become of those whose incomes, founded on former contracts, were paid them in such money ? What was the Government to do ? Why, to fix a price upon all the necessaries oj life, and to compel people to sell their goods at those prices. This was done, and all farmers, bakers, butchers, and others, were compelled to sell their commodities at the same price, in assignats, as they used to sell them at in money, before any as- signats were made. The consequence of this was, that those who had corn or meat or other neces- saries, did not bring them to market; the shopkeep- ers shut up their shops, or hid their goods. To counteract this, a law was passed to punish monopo- lists, and every man who kept more corn, meat, or necessaries of any sort, in his house, than was ab- solutely necessary for the use of his own family, became a monopolist, and, in many cases, such per- sons were punished with death ! This was the last of that series of measures, which was adopted in France during the reign of terror and blood. The guillotine was continually at work to enforce this last measure. The market-place in every consider- able town reeked with human blood. Hundreds of thousands of innocent country people and shopkeep- ers perished upon the scaffold and in prison, in con- sequence of the laws made for the purpose of sus- taining a depreciated paper money in France $ and, wherever a similar project is attempted to be forced into execution, similar consequences will follow. At last, however, the people of France, unable to endure so hellish a system any longer, put an end to it and to its authors. The paper money was totally annihilated, and in a short time, gold and silver came back into circulation. But, in the mean while, what protection did any of these measures give to 31* 366 PAPER AGAINST GOLD. the man of fixed income, who might be compared to our fund-holder ? How did he get any protection from any of these measures ? Yet, he got full as much as the fund-holder in England will get from this measure of Mr. Perceval, who, though he may, in part, ruin the land-owner, will not, thereby, do the fund-holder the smallest good. The rent of the fund-holder's house is the least article of his yearly expenses. His servants, his upholsterer, his butch- er, his baker, his haberdasher, his draper, his brewer, his wine-merchant, &c. &c. will all be paid in gold, or in paper upon the principle of TWO PRICES. There is, therefore, no means of protecting the fund- holder against these gentlemen, except the maxi- mum. It is useless to talk about it, and for people to attempt to buoy themselves up with a sort of vague notion of the impossibility that an English ministry should ever do what was done by Robes- pierre. I hope they never will, indeed ; but, this I am sure of, that, without doing what was done by Robespierre, they cannot make the fund-holder's in- come equal in value to gold and silver. This is what Mr. Perceval wishes to do ; this is what he calls protecting the fund-holder, and this would be protecting him ; but this, I tell him, he cannot do, nor can all the powers on earth do it. To stop where we are is within the scope of possibility. By an immediate stop to the increase of the National Debt and the Dividends ; by an immediate stop to all Loans and issues of Exchequer Bills ; by an im- mediate reduction of the Taxes ; by such means, immediately adopted, we might stop where we are ; but, to restore is impossible. To make the divi- dends worth their nominal amount in gold and silver is no more possible than it is to bring ba^ck yesterday. When I closed my last Letter, I thought that in this I should have been able to conclude the discus- sion ; but the debate in the House of Commons has created new matter, and as I wish to see the event PAPER AGAINST GOLD. 367 of the Bill now before that House, before I take my leave of the subject, I must defer the conclusion till next week. I remain, Gentlemen, Your Friend, WM. COBBETT. State Prison, Newgate, Friday, July \2tJi, 1811. LETTER XXVII. "I maintain, that all Europe is contemplating the payment in specie at the Bank, as the criterion of the credit of the country. If the Bank continue to issue paper without Control, the Country Banks will do the same. They will pour out their notes upon us without mercy ; and we are now BEGINNING A COURSE OF A3SIGNATS Loud cries of Order . Order! Question, Question^ Question, from every part of the House." Mr. Robson's Speech in the Honourable House, 2nd April, 1802. " By these WISE and provident measures (the measures relating to the Bank Stoppage) all the apprehensions I hat were entertained are vanished : the Mr. Robson's Proposition George Rose's " Blessed Com- forts" The Nature and Extent of these Comforts Great Use of ascertaining them Necessity of discovering who has got the Money that has been borrowed on Account of the Public Case of De Yonge. GENTLEMEN, BEFORE I resume the thread of our discussion, which was rather abruptly broken off at the close of my last Letter, give me leave to beg your attention to the two passages, which I have, upon this occa- sion, taken as MOTTOS. You see, that Mr. ROBSON was called to order; that he was run down by all parts of the Honourable House ; that he was hooted out of countenance, and, you may see in the history of that day's proceedings, that he was obliged to sit down and to hold his 368 PAPER AGAINST GOLD. tongue. An< yet, what did he say ? What was the folly he was guilty of? Why, foretelling pre- cisely what has now come to pass. And, I beg you to observe, that he recommended, upon the occasion here referred to, a control as to the quantity of pa- per to be issued by the Bank, a measure now recom- mended by the whole of one party in the Honoura- ble House, and by part of the other party and, though I am not one of those who think that it would have been possible to save the paper by the means of any such control ; still the proposition is now put forward as the only one that can restore the paper to its former value. Yet did the members of the Honourable House hoot Mr. ROBSON down; they coughed, and laughed, and hallooed him off his legs. Ah! but those times were very different from the present. The enemies of the truth were then strong. They had not, as yet, seen the guinea at a premium, and the bank note at a discount. Faith! they have a great deal more to see yet : what they have to see, they can scarcely guess at ; much good may it do them. They hooted down Mr. Robson ; they had their own way ; and, therefore, let them not complain when the days of their humiliation shall arrive. The second motto calls to our minds the means that were, and that all along have been, made use of to deceive the people as to the finances in gene- ral, and, especially, as to the state of the paper mo- ney, in which wort this GEORGE ROSE has borne a principal part. He was, for many years, Secretary to the Treasury under PITT, by whose authority this publication was made in the name of ROSE. In short, he has been a great actor in the drama, which is now drawing to a close ; and he is one of the men, of whose past conduct it will, hereafter, ' be necessary, absolutely necessary, to give the history. " Not the slightest inconvenience" No, not to George Rose, perhaps ; but, could the rest of the nation say so ? Could they say so, out of whose PAPER AGAINST GOLD. 369 taxes George Rose was getting about ten thousand pounds a year ? But, there is another passage in this same publication of GEORGE ROSE, to which I must beg leave to solicit your attention, of which it is well worthy. " There is a time for all things," and now is the time for reminding the people of England of the means by which they have been deluded. It was in vain to endeavour to open their eyes before ; but now, perhaps, they may be induced to make use of their senses. The following is a specimen of the means employed to delude them, at once to wheedle and to scare them into a quiet surrender of their money. I beg you to read it with attention ; and you will, I hope, be ashamed at having been deceived by lies and hypocrisy so glaring. " As the amount of the debt, which will be incurred in this and every sub- sequent year of the war, will be so reduced by the application of the money coming in from the tax on income, (after ten millions shall have been raised for the service of each current year,) as that the permanent debt, which will be left as an addition to the antecedent one, will not exceed the annual amount of the whole produce of the Sinking Fund. This is A TRUTH so important, that it cannot be too often, or in too many shapes, exhibited for the satisfaction of our country, for the conviction of our enemies, and for the information of Europe. If France has built hopes, (founded on ignorant or vi- sionary calculations,) on the expected overthrow of our financial system, and has trusted to the failure of our resources, she may now perceive what means, after so many years ot this arduous struggle, Great Britain still possesses for maintaining it. It would be a slander to the sense and virtue of the people, to suppose an abatement of that spirit which has ena- bled Government to call forth those resources. The prosperous state of the empire, which affords the power, furnishes all the motive, for continuing the con test ; a contest, the support of which, to a 370 PAPER AGAINST GOLD. successful issue, is to secure us in the enjoyment of every national advantage, and to protect us from the infliction of every national calamity. The im- perious and awful necessity of the present crisis, un- avoidably subjects us to heavy burdens. It has been said, that they ought to be considered as a SAL- VAGE for the remaining part of our property. In the consideration of property, to which it was appli- ed, the figure is sufficiently striking ; but, in other respects, the metaphor, though just, is inadequate. What Tariff shall settle the difference between na- tional independence and inexorable tyranny ? be- tween personal liberty and requisitions, prisons , and murder ? between the BLESSED COM- FORTS OF RELIGION, and the gloomy despair of Atheism ?" Well said, old GEORGE ROSE ! This was the sort of language by which the nation was led on in the former war. The cant does, indeed, no longer take. It has not the powers that it possessed ten years ago; but, still there is cant in the nation, and we ought to be constantly upon our guard against it, " Between the blessed comforts of Religion, and the gloomy despair of Atheism /" Why this, gen- tlemen? What had the blessed comforts of religion to do with the matter ? How, if any of you had had the spirit to put the question to him ; how were the blessed comforts of religion to be taken from you by the French Republicans? How were those blessed comforts to be secured to you by a bloody war against those Republicans? In short, what had religion or Atheism to do with the matter? What an impudent thing to tell you, that, if you did not part freely with your money, you would be plunged into the gloomy despair of Atheism! What an im- pudent thing was this ! But, let us see what GEORGE ROSE really meant when he was talking about the blessed comforts of Religion, and the salvage, upon your property. He says, " salvage upon OUR property ;" but } we shall soon see what PAPER AGAINST GOLD. 371 sort of salvage he paid. You were to pay salvage* but he did not tell you to whom. He did not tell the " thinking people" that he, himself, was one of the great receivers and pocketers of the said sal- vage. Yet, at the time when he wrote, he and his sons were, and they now are, in the receipt annually of public money to the following amount: OLD GEORGE ROSE, as Treasurer of the Navy, 4,324 OLD GEORGE ROSE, as Clerk of the Parlia- ments, which is a sinecure, and is for his life, and is granted, also, for the life of his eldest son, YOUNG GEORGE ROSE, 3,278 OLD GEORGE ROSE. Keeper of Records in the Exchequer, another sinecure place, 400 WILLIAM STEWART ROSE, second son of old George Rose, as Clerk of the Exchequer Pleas, which is also a sinecure place, 2,137 10,139 Such was the sum which " the blessed comforts of religion" yielded to this man : no wonder, then, that he felt an uncommon degree of horror at the thought of seeing those blessings supplanted by the " gloomy despair of Atheism," which of course being interpreted, meant the loss of this ten thou- sand pounds a year ! So you, the people of England, yea, " this most thinking people of Europe," as Lord STORMONT (who by-the-by, had a fat sinecure) called them, were to pay George Rose and his sons ten thousand pounds a year in part of the means of preserving themselves from the gloomy despair of Atheism! But, observe, Gentlemen, OLD GEORGE ROSE has been for nearly thirty years in the receipt of large sums annually of the people's money. His salary as Secretary of the Treasury he had before he was Treasurer of the Navy, and that was 4,000/. a year. It is si.rleen years, at least, since he got the grant of the office of Clerk of the Parliaments, at 3,27S/. a year, which is just so much money for 372 PAPER AGAINST GOLD. doing nothing at all, the office being what is called a sinecure. How long he has possessed the 400/. a year as keeper of the Exchequer Records I do not know; but, I believe, twenty years, if not more. So that, I think, we shall not be far from the mark, if we suppose him to have possessed the whole for twenty years past. What other emoluments he may have had, how much more of the public money he may have received, I do not know. His son GEORGE is, I believe, to have a large pension for life for his trip to America ; where he did not remain a year, I believe, altogether. But these will be matters for another day's reckoning. For the present let us see what the above sum amounts to in the course of twenty years. The principal money is 202,780Z. In words, two hundred and two thousand, seven hun- dred and eighty pounds ; and if we add the interest, the amount is about 323,000/. ; in words, THREE HUNDRED AND TWENTY THREE THOU- SAND POUNDS, nearly two thirds of which have been received for sinecure places, that is to say for doing nothing. Here are " blessed comforts of religion /" The thinking people, " most thinking people in the world" were desired to believe, that unless they paid this and other such sums, they would lose all the " blessed comforts of religion," and would be plunged into the gloomy despair of atheism, ; that, in short, if they did not continue to pay these sums of money, they would all go to hell as sure they were born. Oh, " most thinking people !" But, Gentlemen, now let us apply what has here been said to the subject before us. I observed to you, before, and, indeed, proved to you, the measure of Lord King was rendered necessary by the differ- ence between the value of paper and that of coin, and that that difference has arisen from the depre- ciation of the paper, that that depreciation has arisen from the abundance of the paper compared with the quantity of gold in circulation, that that abundance PAPER AGAINST GOLD. 373 has arisen from the stoppage of the payments of cash at the Bank, that that stoppage arose from the vast increase in the amount of the National Debt and the Dividends : all this I have before proved to you, and in a manner, I trust, that you clearly un- derstand ; but, there is still one stage further to go back, and that is, to the CAUSE of the increase of the National Debt ! Mark well; what I say here, Gentlemen. Mark this well ; for this is now, or, at least, it very soon must be, the great, and indeed, the only object, connected with the paper system, worthy of our attention. In the common concerns of life, in the affairs of individuals, where interest induces men to do the "best they can for the prosperity of the concern, we always find, that, in the case of embarrassment, arising from debt, the cause of such debt is looked well into by those who wish to retrieve the affairs of the concern ; and, if they find, that the debt has been incurred by this or by that species of extrava- gance, they set to work to put a stop to such extra- vagance, and, in cases calling for it, they inquire who it is that has derived gain from the creation of the Debt. And why, should not we do this ? Why should not we, in our present state, inquire who have, if any persons have, gained by this increase of debt; or. in other words, whether there be any persons who have been receiving, for the last twenty or thirty years, (we may stop there,) large sums of money out of the loans, which loans have added to the Debt ? Why, in short, should not we look with this sort of eye into our affairs ? The nation, this " most thinking' nation," seems here again to be de- luded. The public were getting into motion : it was impossible to keep them perfectly quiet any longer : but, it was easy to throw them off upon a wrong scent ; and, for this purpose, the halloo against Lord KING was set up. But, " steady" men of England ! " Solid" men of England ! Thinking, " most think- ing people" of England ! Do not, thus to the last, 32 374 PAPER AGAINST GOLD. expose yourselves to the ridicule and contempt of the world ! Let me beseech you not to be dupes and gulls to the last moment ! What, considering us as rational men; consider- ing us as intellectual beings ; considering us as crea- tures having souls in our bodies ; considering us as something superior to the beasts that perish ; con- sidering ourselves in this light, what, I ask, have we to do with the manner in which Lord KING, one of the landowners, wishes to settle with his tenants for their rent ? Let him, in the name of common sense, manage his affairs in anyway that he likes best; and let us endeavour to retrieve our affairs. With this laudable determination in our minds, and being con- vinced that all our embarrassments arise from our debts, let us look back into our books for the last twenty or thirty years, and see how we have got rid of our money. We have always had a large in- come, and yet our AGENT, for the time being, has been bor rowing money for us. This may possibly have been necessary ; but, at least, let us not act the part of careless men in common life, who, in spite of circumstances enough to awaken suspicion in cre- dulity itself, still confide in a plundering sharper. Let us look into our books : let us look back into our old accounts, and see what our AGENTS, in succession, have done with our money. Our income they have expended, they have made prodigious loans in our name, and have charged us with interest upon them: let us see, then, to whom and for what they have paid away all this money; for, if we should find, that they have taken any part of the money to them- selves or given it away, that opens to us a most in- teresting view of the matter. Well, then, in looking over the account books of the nation for the last twenty or thirty years, I $nd several large sums paid to OLD GEORGE ROSE and his sons, and I find, too, that the far greater part of it has been paid to them for sinecure offices, that is to say nothing-to-do- Offices. I put these sums to- PAPER AGAINST GOLD. 375 gether, I calculate the interest upon them, and I find these, together with the interest, amount to 323,000 or thereabouts. So ! say I, here I have, then, dis- covered the cause, in part, of this embarrassment of our affairs. If this money had not been given to the ROSES, the nation would not, of course, have been so much in debt, the dividends upon the interest of the Debt would not have been so large, the Bank Company need not have made so much paper to pay the Dividends with, the run upon the Bank would not have taken place so soon, the stoppage of cash payments would not have been called for at so early a period, the depreciation would not have come on so fast, the gold would have been longer in arriving at a premium, and LORD KING would not as yet, at least, have given the notice which has led to the Bill now before Parliament. I shall be asked, perhaps, what signifies 323,000 when the whole of the Debt amounts to 800,000,000. My answer is that millions are composed of ones ; and that no sums are so large as those which grow out of many small ones. But is this a small sum ? Look at it ! It is a 2,500//& part of the whole of the National Debt. Think of that ! I may have had an error in my estimate ; the Roses may not have had this income for so long a time ; and I may have committed an error in computing the amount of the interest ; but, if I am right, as I think I am, and under the mark instead of over the mark, then have these persons, this one family, and, indeed, ' one member of it chiefly, received, from the nation, in principal and interest, a 2,500th part of the whole of the National Debt at this day in existence. Here, we are upon the TRUE SCENT, Gentle- men ; and I am quite satisfied, that all the hallooing and hooting and doubling and luring in the world, will never, in the end, prevent us from having suc- cess in the chase. A 2,500th part of the whole Debt mind ; but, of the Debt created within the last twenty or thirty years, it will make about a 1,800th part. So 376 PAPER AGAINST GOLD. that, if my calculation be correct, GEORGE ROSE and his son (without meaning the value of the reversion- ary grant or of the Envoy's pension) have, during the last twenty or thirty years, received, in principal and interest, a sum of money from the people equal to a l,SQQlhpart of all that portion of the National Debt, which has been created during the last thirty years. When sinecures and pensions have been talked of, you have observed certain persons set up an af- fected horse-laugh, as if the amount was a mere trifle, a thing to laugh at; but, you see, Gentlemen, that these are not trifles ; that they are things worth looking into ; and there are few persons, I believe, who have ever had to do with embarrassed pecuniary affairs, who will not think with me, that the sooner we look into these things the better. For, if we were, for instance, to find out, in searching the Na- tion's old accounts, 1,800 persons, each of whom has received of the public money, in the last thirty years, a sum in amount equal to that received by GEORGE ROSE, then the thing is made clear at once. There is no more difficulty. We, at once, see the cause of the increase of the National Debt ; or, at least, we see the means that might have been employed to prevent the stoppage of the Bank cash payments, and the consequent depreciation of the paper-money, I shall be told, may be, by some persons, that I forget the services which GEORGE ROSE has rendered to the country. That is a point upon which men may differ in opinion ; but, then, that claim has been satisfied by the salaries as Secretary of the Trea- sury and Treasurer of the Navy ; so that, at any rate, there are more than six-tenths of the whole sum to be kept to the sinecure account ; and, as I said before, there may have been many and large emoluments of which I have, and can have, no know- ledge. There is, indeed, the other claim mentioned in the early part of this letter, namely, the preserving to us, the " most thinking people in the world," the "BLESSED COMFORTS of religion ; and really PAPER AGAINST GOLD. 377 I must confess, that, against those who thought that paying taxes and creating National Debts were ne- cessary to prevent them from being made Atheists by French Republicans, this claim is good. Those "who could be made believe that, must be of so stupid and so base a nature as to make them wholly un- worthy the attention of him, whose object is to be happy and free ; because such people must have been fashioned by nature to be slaves. What a degra- ding idea ! Pay money to prevent myself from being made an Atheist ! Pay taxes ; suffer in silence my estate to be taken from me by piece-meal, and sit quiet while I am told, that this is necessary in order that the French may not take from me " the BLESSED COMFORTS of religion !" Talk of credulity, in- deed ! I defy any man to produce me, from the an- nals of superstition, from any of the records of human credulity or human cowardice, any thing which, to the character of man, is so degrading, as this is. Yet, this was the sort of language made use of by the partizans of PITT, during the whole course of the Anti-jacobin war. There were many tricks played off; but the grand, the master trick, the never failing fraud, was the alarm at the danger of seeing Athe- ism introduced instead of the Christian Religion ; the " gloomy despair of Atheism," says GEORGE ROSE, instead of " the BLESSED COMFORTS of religion !" What would I give to have seen GEORGE just at the moment of his finishing that sen- tence ! I should like to have watched his looks, and, if possible, to have heard his soliloquy ! " BLESSED COMFORTS of religion!" He seems totally to have forgotten the ten thousand pounds a year ; but, I trust, that the time is not far distant, when that, and all other matters of the kind, will be well and scrupulously attended to. Upon a future occasion, Gentlemen, I intend en- tering more at large into an inquiry as to what has become of the money borrowed during the last twenty or thirty years; but this I must defer till 32* 378 PAPER AGAINST GOLD. another opportunity. In my next I intend closing this series of letters, when I shall have seen the dis- cussions upon the Bill, now before the Parliament, brought to an end. That will be a natural point for me and you, Gentlemen, to rest at, until some- thing new and important shall arise, and that will soon be the case, I am pretty certain. In the mean while, I beg leave to subjoin a few remarks on the case of DE YONGE, together with a Letter from him- self to LORD VISCOUNT FOLKESTONE, and remain, Your faithful friend, WM. COBBETT, State Prison, Newgate, Thursday >, July 18, 1811. THE case of DE YONGE, the Jew, who, in the month of August last year, was tried for selling Guineas for more than their nominal value in Bank- Notes, has proved, what I then said it would be, " one of the most important that had taken place for many years." 1 said, and published at the time, my opinion, that, notwithstanding the prosecu- tion had been ordered and carried on by the Attor- ney General (Gibbs,) and though the man had been found guilty by a Special Jury, and in coincidence with the direction of the Judge (Ellenborough ;) notwithstanding all this, I gave it as my decided opinion, and maintained that opinion by argument, that the Jew had been guilty of no crime in the eye of the law of England. The case, as we have be- fore seen, has since been argued before the Tivelve Judges, and they have pronounced, that what the man was charged with, was not a crime. It is a long time since this man's prosecution began. No- tice will be found of it in the Register a year and a half ago. It was manifest, that the poor man must have greatly suffered in purse as well as in mind ; and, when the Judges had declared him guilty of no crime, LORD FOLKESTONE, who had be- fore interested himself greatly in the man's fate, PAPER AGAINST GOLD. 379 and had given notice, that if the case was not speedily decided upon by the Judges, he would bring it before Parliament ; when the Judges had de- cided, his Lordship complained, in the House of Commons, that the poor man had suffered greatly, and ought to have compensation made him. The ATTORNEY GENERAL answered, that every man was liable to the same sort of inconvenience and injury. To be sure, said his Lordship, every man is liable to have a false accusation preferred against him ; every man is liable to be prosecuted without suffi- cient grounds ; but this was a singular case : the prosecution was ordered by the King^s own Attorney General ; and, what is more, the crime, as it was called, was, by the Government Solicitor, procured to be committed ; so that the man was prevailed upon by the prosecutors to commit what they deemed a great crime ; they tempted him to commit the crime ; they, in fact, made the crime, or the sup- posed crime, that they intended to prosecute, and that they actually did prosecute. This is by no means a common case ; it is by no means one of those vexatious and groundless prosecutions to which any man is liable from the malice or mistake of others. This was a prosecution by the law officers of the Crown, and by the Attorney General in par- ticular ; and, all the sufferings of DE YONGE have arisen from the Attorney Qeneral's not knowing the law upon this point. It is no crime, to be sure, to ,be ignorant of the law upon any point ; nor is it to be supposed that Attorney Generals are conjurors any more than other men ; but, when they seek to get the grounds of a prosecution ; when they get a man to commit a crime, (or when those under them do it,) they may have an opportunity of prosecuting it ; when this is the case, there can be no doubt, I think, that they ought to know the law before they proceed. And, I am quite sure, that, in all sucn cases, where there is an acquittal at last, the suffer- ing party ought to be indemnified for his sufferings 380 PAPER AGAINST GOLD. and losses. For if this be not so, what man is safe from utter ruin ? Who may not be ruined ? What DE YONGE has suffered we shall now see, in a Let- ter, which he has had the gratitude to address to LORD FOLKESTONE, and which, as being a very clear and modest statement of his case, and as a docu- ment connected with the great subject' of which we are here treating, I here insert : " My LORD ; I shall be wanting in gratitude were I to omit returning you my most sincere thanks for your disinterested endeavours on my behalf, and I. assure your Lordship I do not feel less grateful be- cause they were unsuccessful. Your Lordship will perhaps excuse me if I mention a few circumstances in my case of which I think I am justified in com- plaining, and particularly as Mr. Attorney General asserted that I had suffered no material hardships. In the first place, I did not seek the barter or ex- change which formed the subject of the accusation against me ; the plan was laid by the Mint Solicitors to tempt me to the bargain, and then to prosecute me, Pursuant to this arrangement, a foreigner was employed, who came to my house as the interpreter to another man, in his company ; they stated, that they were recommended to me to make the purchase, and, after urging me to deal with them, officers came into my house, seized me and my money, and, at a late hour in the evening, I was hurried from my fa- mily to a loathsome prison, (the Poultry Counter,) and there kept three days and three nights in cus- tody without bail being admitted. At length, on the final examination, I was discharged on giving bail to a large amount, which I had some difficulty in pro- curing ; and had I not been able to obtain it, I must have remained in custody 18 months, the- period this question has been pending. Lastly, the expense and anxiety I have sustained has been enormous, some through the solicitors for the prosecution, for after going through all the necessary forms of law to bring the first Indictment against me to issue, and, PAPER AGAINST GOLD. 381 indeed, when it stood for trial, the prosecutors moved to quash it and prefer another, because they had misrecited the proclamation. A second Indictment was accordingly found, and this also I proceeded in, until it was coming on for trial, at the Old Bailey, when, to my great mortification and astonishment, it was removed by the prosecutors, into the Court of King's Bench, by which means I had, as it were, my defence again to commence. Being in very mo- derate circumstances, and having a family to sup- port, I have necessarily sustained many deprivations in consequence of the great law expenses incurred in defending myself against this accusation, and, I fear, it will be a considerable time before I can re- cover myself from the injuries I have sustained. I will not further trouble your Lordship, but conclude with observing, that I humbly conceive the Law Officers of the great public bodies and of Govern- ment, having, as they must, the best means of inform- ation on legal points, ought to be somewhat more circumspect and accurate in their expounding acts of parliament, before they distress and bear down an humble individual, and expend the public money, by harassing and groundless prosecutions. I am, my Lord, with the greatest respect, your most obe- dient and very humble Servant, " JAMES DE YONGE. c 107, Hounsditchj mh July, 1811. LETTER XXVIII. "I looked upon the Bullion Report as likely toJead to what would be likely to secure the country from the natural consequences of that overwhelming corruption, which 1 regarded as the fruit pt the paper system ; and, as I bave ths accomplishment of this great object deeply at heart ; as I look upon the happiness and honour of my country asot far greater value tome than any other worldly possession, I said, and I still say, that the Bullion Report has given me more pleasure than I could derive from being made tlii owner of the whole of Hampshire. As to any idea of a -party nature. 3S2 PAPER AGAINST GOLD. I shall, I am Bure, be believed, when I say, that I do not care one traw to what party the Committee belonged. If I had a wish as to party, it certainly would be, that no change of ministry should take place; for without prejudice to the OUTS, who, I think would do the tiling full as well with a littie more time, I am quite satisfied, that the present people will doit as ne.atly and as quickly, as any reasonable man can expect." POLITICAL REGISTER, Vol. XV1I1. p. 427, Sept. 22nd, 1810. Progress of Lord Stanhope's Bill Effects of its Provisions- Mr. Brougham's ResolutionsThe Justice of Lord King's Claim insisted on Illustrated hy the Grants to the King and the Additions to the Pay of the Judges. GENTLEMEN, THE Bill is past! And, be you assured, that the die is cast ! When I wrote the passage, which I have taken for my motto to this letter, I did expect to see what I hinted at in the close of that passage ; but, I must confess, that I did not expect the progress to have been quite so rapid as it has been. For the future my calculations will be more likely to keep pace with events. Well, the Bill of Lord Stanhope is now become a law. We will, therefore, take a short view of the rise and progress of it ; and, when we have so done, we will examine its provisions, and endeavour to point its consequences. The Bill was brought into the House of Lords, and read a first time on the 27th of June, when no division took place, and when an intimation was given by the ministers, that they should oppose it. On the second of July, it was read a second time, and, being now supported by the ministers, the question for the second reading was carried, 36 for it, 12 against it. On the 8th of July, it was read a third time and passed, 43 for it and 16 against it. In the Honourable House, it was read a first time on the 9th of July, and, upon a di- vision on the question, there appeared 64 for it and 19 against it. On the 15th of July it was read a second time, 133 for it, and 35 against it. On 'the 17th of July, it went through a committee of the House, and, on the 19th of July, it was read a third time, and passed with the amendments relating to PAPER AGAINST GOLD. 383 the penalties. On the 22nd of July, the amendments introduced by the Commons were agreed to by the Lords. On the 24th of July, it received the Royal Assent by Commission ; and thus it is become A LAW ; thus a new penal law has been added to the almost endless number already in existence. Many hundreds of the people of this country have been banished, or put to death, for imitating" the promis- sory notes of the Bank Company ; and now the peo- ple are liable to be punished for passing them for what they may deem their worth, though they be their own property. The provisions of the Bill are not numerous : it is a pithy affair. The first part relates to the passing of coin and paper, and the second to the recovery of rents. It will be best to insert the words. Those of the first part are as follows : " Be it enacted, that from and after the passing of this Act, no person shall receive or pay for any gold coin lawfully cur- rent within the realm, any more in value, benefit, or advantage, than the true lawful value of such coin, whether such value, benefit, profit or advantage, be paid, made, or taken in lawful money, or in any note or notes, bill or bills, of the Governor and Company of the Bank of England, or in any silver token or tokens issued by the said Governor and Company, or by any or all of the said means wholly or partly, or by any device, shift, or contrivance whatsoever. And be it further enacted, by the authority aforesaid, that no person shall, by any device, shift, or contri- vance whatsoever, receive or pay any note or notes, bill or bills, of the Governor and Company of the Bank of England, as of less value in money, except lawful discount, than the sum expressed therein, to be thereby made so payable." Thus it stood as it went from the Lords. There were, I believe, some trifling verbal alterations made in the Honourable House, who also added the penalty, and made it a misdemeanor to disobey this part of the law : of course, offenders against it may be punished by Jine 384 PAPER AGAINST GOLD. and imprisonment, or, as I am, by both, at the dis- cretion, perhaps, of the Judges ; but, of this I am not sure, not having, as yet, seen the Act in its finished state. Thus, then, the Bank Company, after having ap- plied to the Government to issue an Order in Council, after having subsequently applied for acts of Par- liament, to screen them against the consequences of refusing to pay their promissory notes in coin, now see a law passed making it criminal, for any one to get rid of any of those notes that he may happen to possess, for their real worth in coin ! This law does what the laws already in existence could not do in the case of DE YONGE ; or, at least, it attempts to do it. It forbids and punishes the selling of gold coin for more than its nominal worth in Bank Notes, which was precisely what DE YONGE did. But, do you believe, Gentlemen, that this will put a stop to the traffick? I should think, that no- body could believe this ; and, if any one were ift- clined to believe it, he need only consider the little effect produced by the conviction of DE YONGE, to convince him of the contrary. That gentleman was found guilty of the crime of selling guineas at twenty-two shillings and sixpence each, and while he lay under that conviction, the price of the guinea rose to twenty- six or twenty-seven shillings. This is a pretty good proof that the price of the guinea is not to be kept down by penal laws. But, if the law should put an end to all purchases of gold coin in Bank of England notes, it cannot have any such effect with regard to country bank notes. Suppose. for instance, that one of you had a fancy for a hun- dred guineas to lay snugly aside, and I had them to dispose of; the price would be 1351. but, say we, the bargain must not take place in notes of the Governor and Company in Threadneedle street, for so says Lord Stanhope's law. But the law does not say, that such bargains shall not be made in country bank notes ; and, therefore, you give me 135/, in the PAPER AGAINST GOLD. 385 notes of Paperkite and Co., which notes will, in all probability, answer my purpose full as well as the London notes, or better, if I want to pay them awav in the country ; and, if they should not answer my purpose quite so well, what have I to do but go lo the country banker and get them changed for Bank of England notes? I keep the country bank notes if I please, and if I please I change them. This is one way, then, and a most effectual way too, of rendering the Bill of no use as to its main apparent object. But, how many are the ways, in which such a law may, must, and will be evaded ? It is a law in- tended to make people part with their property for less than its worth in the one case, and to make them obtain for it more than it is worth in the other case. The old adage of " a thing is worth what it will bring" is, by this law, to be totally destroyed after having lived in the world ever since purchase, or even barter, was known amongst men. According to this law, a thing, in one case, will be worth more than it is to be suffered to bring, and, in the other case, a thing will not bring so much as it is asserted to be worth. It is a law, in short, to compel men to dis- pose of certain articles of their property (if they dis- pose of them at all) at a price fixed on by the Go- vernment ; and is such a law as never was heard of before, except in France, during the times of Robes- pierre, Danton and Marat. It is, as Mr. BROUGHAM has called it, in his Resolutions, a law of maximum as to gold coin ; but, it is a law, which cannot be generally enforced, and which can have only a tem- porary and partial effect, if any at all, in checking the traffic in coin against paper ; and to whatever extent it is efficient, it will be efficient in driving all the coin out of the kingdom, excepting such por- tion as people are enabled to hoard ; for, if I have a guinea, or any thing else, that is worth 27 shillings, and if there be a law which prevents me from get- ting at present in England more than 21 shillings 33 386 PAPER AGAINST GOLD. for it, I shall certainly hoard it till I can get the worth of it, if I have no safe means of sending it abroad. Where is the man who will not do this ? I am sure that there is not a man amongst you who would not do it. Yes, I am sure, that there is not one single farmer in all England, who will not hoard a guinea rather than exchange it for a bank note of twenty-one shillings. So that, as I have ob- served to you before, and as has been very well ex- pressed in Mr. BROUGHAM'S Resolutions, this law will, as far as it shall be efficient, drive the little re- mains of gold coin into hoards or out of the country, and, by preventing a free and open and unrestrained competition between the coin and the paper, will, as far as it has effect, prevent the operation of the only cure for the evil of a depreciated paper money.* * It was on the 19th of July, that Mr. BROUGHAM proposed his RESOLUTIONS to the House of Commons. They were nega- tived: and, gentlemen, I beseech you to compare them with such resolutions as were agreed to by that House. These Resolutions are well worthy of attention, containing'as they do, what will become a memorable protest against the law, which is now the subject of discussion, and which will be a subject of observation with our children, if any trace of it shall remain beyond our own times. I. That by the Law and Constitution of these Realms, it is the undoubted right of every man to sell, or otherwise dis- pose of, his property, for whatever he deems to be its value, or whatever consideration he chooses to accept. And that every man possessed of a Bank Note, or other security, for the payment of money, has an undoubted right to give it away for nothing, or in exchange for whatever sum of money he pleases; or if he cannot obtain what he demands, to re- tain possession of it. II. That any statute, having for its object to restrain this right, would be contrary to the principles of the British Con- stitution, and a flagrant violation of the most sacred Rights of Property, and the ancient and inalienable Liberties of the People. HI. That any statute, having for its object to prevent the Bank, or other Paper Currency of the Country, from being exchanged against the lawful money of the Realm below a certain rate, would, if it could be carried into effect, cause the lawful money of the Realm to disappear, and would in pro- portion to its efficacy, preclude the application of the most appropriate remedies for the present derangement in the cir- culation of the country. PAPER AGAINST GOLD. 387 I have before observed, that, in all ready-money transactions, this law must be nugatory, and I have given an instance of a farmer having a pig to sell at market. It will, of course, be the same in all other bargains for ready-money ; and, even in cases of cre- dit, amongst friends and neighbours^ the same will take place. Some roguery may be, in this respect r created by the law, but the law will never compel men to give the guinea and receive the note at their nominal value, one compared with the other. In that place, where, of all others, one might expect to see the dispositions of men concur with this law ; I mean, the Stock Exchange, a distinction between coin and paper is already made ; for Stock has fre- quently been bought with guineas at a price much lower than the rate of the day, which rate is regulated upon the supposition that paper-money is to be the IV. That the free exchange of the lawful money of the realm with the paper currency, on such terms as the h9lders of each may think proper to settle among themselves, is not only the undoubted right of the subject, but affords the best means of restoring the circulation of the country to its sound and natural state, by establishing twp prices for all commo- dities, whensoever the one currency is from any causes de- preciated below the other. V. That no law whatsoever can alter the real value of the paper currency in relation to the lawful money of the Realm, nor alter the real value of either kind of currency, in relation to all other commodities ; and that any attempt to fix the rates at which paper and coin shall pass current, must, in proportion to its success, interfere with the fust and legal execution of all contracts already existing, without the possi- bility of affecting the terms upon which contracts shall be made in time to come. VI. That it is the bounden duty of the Commons House of Parliament, as the guardians of the rights of the people, to discountenance and resist a scheme which has for its imme- diate objects the establishment of a maximum in the money- trade of the realm, and the dissolution of the obligations al- ready contracted by numerous classes of the community, but which has for its ground work principles leading to a uni- versal law of maximum, and the infraction of every existing contract for the payment of money ; and that a Bill touching the gold coin which has lately been brought from the Lords, has all the said objects, and proceeds upon the said principles. 388 PAPER AGAINST GOLD. medium. And, who is to prevent this, without a general law of maximum ; that is to say, a law put- ting a price upon all commodities whatever, and punishing men for selling them for more than the price so fixed? This present law, therefore, is no- thing of itself. It is nothing unaccompanied with a maximum of prices. Those who have begun in this path, must keep on, and go the whole length, or they do nothing at all, except drive coin out of the country or into the hoards, and, perhaps, in many cases, cause a breach of contracts between man and man. To be a maximum they must come at last, or what is done will be of no effect at all. The other provision of the Bill relates to distress for rent, and is as follows : " And be it enacted, by the authority aforesaid, that in case any person shall proceed by distress to recover from any tenant or other person liable to such distress, any rent or sum of money due from such tenant or other person, it shall be lawful for such tenant or other person, in every such case, to tender notes of the Governor and Company of the Bank of England, expressed to be payable on demand, to the amount and in dis- charge of such rent or sum so due to the person on whose behalf such distress is made, or to the officer or person making such distress on his behalf ; and in case such tender shall be accepted, or in case such tender shall be made and refused, the goods taken in such distress shall be forthwith returned to the party distressed upon, unless the party distraining and refusing to accept such tender shall insist that a .greater sum is due than the sum so tendered, and in such case the parties shall proceed as usual in such cases ; but if it shall appear that no more was due than the sum so tendered, then the party who ten- dered such sum shall be entitled to the costs of all subsequent proceedings : Provided always, that 'the person to whom such rent or sum of money is due shall have and be entitled to all such other reme- dies for the recovery thereof, exclusive of distress. PAPER AGAINST GOLD. 389 such person had or was entitled to at the time of making such distress, if such person shall not think proper to accept such tender so made as aforesaid : Provided also, that nothing herein con- tained shall affect the right of any tenant, or other such person as aforesaid, having such right to re- plevy the goods taken in distress, in case, without making such tender as aforesaid, he shall so think fit." Now, what does this part of the Bill effect ? It has frequently heen said, that the tenantry ought to be protected, and Lord Stanhope has all along said, that his object was to protect the tenant. What, then, has this Bill done for the tenant? If the thing leased be a farm, or lands of any sort, distress is not the mode that the landlord would pursue. He has other remedies, and those much more efficient than that of distress. So that, in fact, this law affords no protection at all to the tenant. But, though this law will do the tenant no good, it may, and, in some cases, will, do him a great deal of harm, especially as the minister has avowed his intention of making the bank notes a legal tender if this law should prove insufficient for the object in view. Under such circumstances, no man in his senses, will let a new lease, or renew an old one; for, though a corn-rent might possibly serve to guard him against the total loss of his estate, still he will be afraid, and he will think it the safest way to let no lease at all. Tenants for term of years will, therefore, become tenants at will, and will have their rents raised upon them every year, agreeably to the depreciation of money and the rise in prices ; and, another consequence will be, that landlords will, whenever it is practicable, take the lands into their own possession and use, seeing that even a yearly letting may, in the times that may arise, be- come dangerous ; for, if a law be passed to-day in consequence of a single landlord's demanding his rent according to law, what have not landlords to fear ? The safest course, therefore, that they can 33* 390 PAPER AGAINST GOLD. pursue, is to keep, as far as they are able, their farms in their own hands ; and this, to a very great extent, they certainly will do. So that this law, as far as it is efficient, will produce a virtual violation of con- tracts, and a discouragement to agriculture. During the discussions upon this measure, several hints were thrown out as to the courts of law set- ting their faces against those who should demand payment in gold. Sir SAMUEL ROMILLY observed upon what Mr. Manning said about the law being too strong for the landlords, that it alarmed him to hear such language ; and that he thought it danger- ous in the extreme to expose men to such an uncer- tainty as to the real meaning of the law. But Mr. FULLER and Lord STANHOPE, as appears from the re- ports of the newspapers, came to the point at once. The former is reported to have Said, in the debate of the 9th of July, that " he wondered to hear any doubt of the solvency of Government ; and Govern- ment surely had ships and stores, and plenty of va- luables besides. He (Mr. Fuller) did not under- stand the objects of the persons who had brought forward the question, but he was convinced they were something sinister. (A laugh.) As to Bank notes, if any landlord was offered payment in them, and he wanted gold, he (Mr. Fuller) did not know what might be done ; but of this he was sure, that THE WHOLE TENANTRY OF THE COUN- TRY WOULD MEET AND TOSS HIM IN A BLANKET. (Laughing.") And the latter is reported to have said, in the House of Lords, on the 22nd of July, that, " his Noble Friend (Earl of Lau- derdale) had called the Bill a legislative HINT ; but it was a pretty broad hint, too. He did not know whether his Noble Friend had been educated at any of the Universities ; but he believed not at Oxford. There was a story there about a broad hint which they called c John Kea.le's broad, hint.' There was a man that John Keale did not like ; John gave him a hint that he did not like his company: but he PAPER AGAINST GOLD, 391 would not go away. < What did you do then?' says one to John. ' Do,' says John Keale, { why, I kicked him down stairs.' ' That was a pretty broad hint ! ! !' (Laughing.) So he, (Earl Stanhope,) had given Lord King a hint ; and if he followed up this business, why, when next Session came, he would give him a BROAD hint !" (A laugh.) " Quite a wit, I declare ; Quite a sea-wit, Mr. Ben- jamin !" Well, you know, Gentlemen, that there is a time for all things, and, of course, a time for laughing. But, it is well worthy of remark, that this war (for it is the same that began in 1793) was waared in the "PRESERVATION OF LIBERTY AND PROPERTY AGAINST REPUBLICANS AND LEVELLERS," that was the title of the Association at the Crown and Anchor. This is well worthy of remark ; now is the time to make such remark. This war has now been going on eighteen years ; this war for the support of order and law and property, and now, behold, we hear, in the two Houses of Parliament, the supporters of this system, talk of tossing a landlord in a blanket and kicking- him down stairs, if he should persist in demanding payment of his rents, agreeably to the contract in his leases ! Gentlemen, if you have read the reports of the debates in Parliament, upon this subject, you must have observed, that the people in the ministry have very loudly disapproved of the conduct of LORD KING for demanding of his tenants payment in gold, or in notes in sufficient amount to make up for the depreciation of money. Now, observe ; they have brought forward, several times, propositions for large grants to the King and to others, on account of the rise in prices, which, as I have already explained to you, is only another name for the depreciation of money. I beg you to mark well what I am now going to state to you ; because it will give you a clear insight into this whole matter. In 1802, eight years ago, a large sum of money, PAPER AGAINST GOLD. 392 no less a sum than 990,053Z. (why not have made it a round million ?) was granted by Parliament " to the King, to discharge the arrears and debts due upon the CIVIL LIST on the 5th of January, 1802." The Civil List, Gentlemen, is the King's establish- ment of servants and officers of different sorts, and, in short, of all his expenses. The King had a per- manent allowance, fixed by Act of Parliament, of 800,000/. a year for these purposes ; but, in 1802 (the time we are now speaking of) the Civil List had got into debt ; and the then Minister, Adding- ton, taking advantage of the national satisfaction at the Peace of Amiens, proposed a grant of the above sum, for the purpose of paying off this debt. Mr Fox and others opposed the grant ; but it was sup ported by PITT, GEORGE ROSE, and the majority, and upon a division there were 226 for it and only 51 against. And, let it be borne in mind, that the grant was justified by PITT on this ground : that it did not make an increase to the Civil List equal in proportion " to the increase of the price of commodities, and to THE DEPRECIATION OF MONEY." So he said ; so they all said ; and the assertion was sanctioned by a vote of the House granting 990,0532. to the King. Now, then, if the King was to have a grant like this, on account of the past depreciation of money, why should Lord King be reviled, why should he be tossed in a blanket, or kicked down stairs, for demanding payment in such a way as to give him some security for future depreciation of money, especially when we consider, that he only demanded the fulfilment of a bargain^ while the grant to the King was over and above the fulfil- ment of a bargain made with him by the pvblic ? But, did the demands for the King stop here ? Very far from it ; for, in the year 1804, (only two years afterwards,) PITT, who was then come back into power, called for another grant for a similar purpose, to no less an amount than 591,8422. 3s. W^d. .How scrupulously exact the Gentleman was ! To PAPER AGAINST GOLD. 393 a halfpenny, you see ! Oh, wondrous financier ! This grant also was made, and without any division of thu House ; though it was strenuously opposed by SIR FRANCIS BURDETT, upon the ground of its being a departure from a bargain with the public, and of the practice of making such grants being calculated to render the Royal Family absolutely dependent upon the Minister of the day. This grant also was justified upon the ground that morney had depreci- ated and the prices of all commodities increased. This grant was accompanied with a permanent ad- dition to the Civil List of 60,OOOZ. a year ; and, in- deed, the annual sum, now paid by the people on that account is 958,0002. exclusive of 295,9682. Is. S%d. in allowances and pensions to the Royal Family, be- sides the amount of sinecure places and military offices that some members of the Family enjoy ; the propriety or impropriety of none of which I am dis- cussing, but it is necessary to state them in order to enable you to judge of the fairness of the attacks upon Lord KING, who only wanted a bare fulfilment of contract with regard to his own private estate ; who only wanted to save himself from ruin from the future depreciation of money, and who gave up to his tenants all they had gained from him by the past. Now, Gentlemen, I beg you to observe, that this second grant to the King ; this grant of 591,842 was to pay off what he had lost in two years by the depreciation of money; and, you will also ob- serve, and mark it well, that these are two out of the nine years that have elapsed since Lord King- let the Estate, respecting the rent of which you have seen his notice to his tenant. The King, in 1802, had a fixed allowance of 800,000 a year out of the public money ; and at the end of only two years, his advisers find him to require a grant of 591,842 on account of the depreciation of money; that is to say, 295,921 in each of the two years. More than 30 per cent, per annum I And, is Lord King ; after having silently suffered under the gradual 394 PAPER AGAINST GOLIX depreciation for nine years, to be attacked in this manner ; is he to be lumped along with Jews and Pedlers and Smugglers ; is he to have a hint that he will be kicked down stairs or tossed in a blanket, because he now, when he sees the guinea selling at 25, or 26, or 27s. is resolved to have a fulfilment of his bargain, and not to be wholly ruined by this de- preciation of money ? But, Gentlemen, this principle of augmenting al- lowances out of the public treasure, on account of ' the depreciation of money, has not been confined to j the King and his family. It has been acted upon in almost all the departments under the Government, j the army and navy excepted, where, as far as relates to the Commissioned Officers especially, little aug- j mentation has taken place. I will, however, here ] confine myself to one particular class of persons, j namely, THE JUDGES ; and I do it the rather be- cause it has been hinted pretty broadly, that the j Courts of Law would set their faces against the < efforts of those, who might attempt to enforce pay- ment in gold. Be it known to you, then, Gentlemen, that the | Judges' pay has had two lifts since the Bank stopped j its payments in gold and silver. The first was in j the year 1799, two years only after the passing of J our famous Bank Restriction Act. The two Chief ] Judges, whose incomes were very large, underwent j no augmentation by Act of Parliament ; but, the pay j of all the rest was augmented by the Act, Chapter 110, of the 30th year of the King's reign; and, no trifling augmentation did their pay receive, it being \ upon an average nearly, if not quite, half the whole amount of their former pay. The Chief Baron of the Exchequer had 1,000 a year added to his for- . mer 3,000 a year ; and all the nine Puisne Judges had 1,000 each added to their former pay, which j was in some cases a little more and in some cases a I little less than 2,000 a year before. And, besides this, the Act enabled the King, that is to say, his PAPER AGAINST GOLD. 395 advisers, to make a permanent provision for any judge that might become superannuated, and it fixed on great pensions for them in this case, which pen- sions can, in consequence of that Act, be granted without any particular consent of the Parliament, which was not the case before. Mr. TIERNEY op- posed this measure in a very able manner. He said, that the House of Commons would thus lose all check and control as to such remunerations; and that the influence of the Crown would be thus greatly and most fearfully enlarged. The measure was, however, j adopted ; and thus the Judges, in Scotland as well (as in England, received an ample compensation, for the depreciation of money, up to the year 1797. Having gone on with this pay for ten years, it ap- pears to have been thought time to give them another lift, and, accordingly, an Act for this purpose was passed in the year 1809, of which the people seem to have taken not the least notice. It seems to have escaped every body's attention ; but, indeed, the Acts now passed are so numerous, that it is next to im- possible for any single man to be able to pay atten- tion to them all, or to a quarter part of them. This Act, which is Chapter 127 of the 49th year of the King's reign, makes an addition of 1,000 a year, to the pay of the Chief Baron of the Exchequer ; also an addition of 1.000 a year, to each of the nine Puisne Judges ; and it gives an additional 400 a year to each of the Welsh Judges. Thus, at the end of twelve years from the time when the Bank stopped paying in gold, the pay of the English Judges was nearly doubled ; and, shall my Lord King be represented as a pedler, a jew, and a smuggler, be- cause, at the end of nine, years of depreciation of money, he wishes to put a stop to the ruinous pro- gress ? And shall he be threatened with the hos- tility of these same Judges, in case he should attempt to enforce his legal claim ? Shall he be told about being fought off in the Courts, and about the law being too strong for him? 396 PAPER AGAINST GOLD. At the time when these Acts were passed for aug- menting the pay of the Judges, one of the arguments was, that such augmentation was necessary to sup- port the DIGNITY of the office of Judge. Now, in what way was an increase of pay to produce such an effect ? Certainly in no other way than that of enabling the Judge to augment his expenses of living ; for, as to his authority, as to his powers, as to his station, the money would make no alteration at all in them. This being the case, there appears to have been no good reason for augmenting the Judges' pay any more than the pay of the officers of the Navy, or of any other persons in the public employ. Mr. TIERNEY used, at the time when the first augmenta- tion was proposed, an argument very applicable to our present purpose : " If," said he, " an augmen- tation of income be necessary to support the station of the Judge, has the country no interest in enabling the officers of the Army and Navy, the Ministers of the Church, or the Magistrates, to maintain their sta- tion in society? If the circumstances of a Judge, who has 2,000 a year, require that he should have an additional 1,000, we know very well what must be the situation of a private Gentleman with an in- come of 2,000 a year." This argument applies precisely to Lord King. The answer to Mr. Tierney was, that the private Gentleman, if his estate was in land, would, of course, raise his rents in order to make his income keep pace with the depreciation of money. But the reply to this is, that if his estate was let upon lease, as Lord King's is, he could not raise his rents, till the expiration of that lease ; and if he let a farm upon a fourteen years' lease in the year 1798, he has been receiving money at the rate of that time, during the last thirteen years, whereas the pay of the Judges has been doubled in the space of twelve of those years. This is, in fact, the situation of Lord King. Either, therefore, it was not necessary, and it was not just to augment the pay of the Judges in any PAPER AGAINST GOLD. 397 degree ; or, it is extremely unjust that Lord King should be prevented from augmenting his income. Indeed he has had, till now, all the legal means of making his income keep pace with the depreciation of money, by demanding his rents in gold ; that is to say, agreeably to the terms of the contract, in good and lawful money of the realm. This legal, this equitable, this fair, this honest, this indubitable claim, he was preparing to enforce, when my Lord Stanhope steps forward with the proposition of a law avowedly intended to prevent him from so doing ; to throw impediments in his way ; to interfere in the management of his estates ; to take from him part of the legal means which he before possessed of preserving his property ; and, for having signified his intention to use those means, he is held forth as a jew, a pedler, and a smuggler. I have observed, that Mr. SHERIDAN has taken part upon this occasion with those who have censured Lord KING. And this is the more remarkable, as he has seldom taken part in any discussion whatever. Is Mr. SHERIDAN aware of the consequences to which this may lead ? It is hardly necessary to tell him, that the day must not be far distant, when the CIVIL LIST will have to be settled anew ; and I should be glad to know whether, in that settlement, it is likely to be the wish of the parties concerned, that the sum should be fixed as if it were to be paid in gold. Whether, in short, the amount of the Civil List would be fixed for the future, at its present amount. But, if that were not to be the case, how could a larger amount be proposed or supported by those who have now railed at the conduct of Lord King ? Endless are the difficulties, into which those have plunged themselves, who have reprobated the con- duct of this nobleman as unjust, or who have repre- sented it as unwise. Such persons will hardly muster up the resolution to make a frank acknow- ledgment of their error; and yet, if they do not do this, with what face can they propose, or support, or 34 398 PAPER AGAINST GOLD. sanction, either expressly or tacitly, any measure which shall have for its object, the preservation of the Grown, the Royal Family, the Army, the Navy, the Courts of Justice, or any department of the state, against the effects of the depreciation of money ? The measure of Lord King fell far short of the jus- tice due to himself, for, though the money had de- preciated considerably at the date of his oldest leases, still, it has gone on depreciating further from that time to this. He, therefore, would have been fairly entitled to payment in Gold, and nothing else, for the remainder of those old leases. But, pursuing a moderate and liberal course, he restrained his de- mands far within their legal bounds. With a con- siderateness that does him great honour, he suffered his tenants quietly to retain what they had gained during the past, and only required of them a due ful- filment of contract for the future, which was not less necessary to the welfare of his tenants, than it was to his own protection ; because without such a mea- sure, it was impossible they ever could obtain a re- newal of their leases. Much, during the discussions upon this famous Bill, has been said about patriotism : and Lord King has been charged with a want of that quality, because he made the demand, of which so much has been said. But, if Lord King, in barely demanding the fulfilment of a contract in order to protect him- self against the effects of the depreciation of money ; if Lord King, in barely appealing to the law already in existence for his protection against this ruinous effect of paper money ; if, for this, Lord King is to be accused of a want of patriotism, and is to be lumped with Jews, Pedlers, and Smugglers, what will be the inference with regard to the King and Royal Family, and my Lords the Judges, to protect whom against the effects of depreciation, laws have been passed, laws proposed by the minister of the day and sanctioned by the majority. Lord King comes for no law to protect him ; he asks for no law PAPER AGAINST GOLD. 399 against his tenants ; he only wants his due accord- ing to the existing law; and yet, he is, and by the very people, too, who approved of the above-men- tioned large grants to the King and the Judges, ac- cused of a want of patriotism ! The venal prints have not failed to join in the ac- cusations against Lord King, whom the COURIER, on the 5th instant, charges with motives of " base lu- cre" as the ATTORNEY GENERAL did me, and with precisely the same degree of justice. The article here referred to in the COURIER concludes with some observations as to the duty of patriotism, in this case ; and says, that, " On an occasion in which ALL SUFFER, the man who first abandons the general cause for his own personal interests, must needs make a very sorry figure before the world, just like the coward who is the first to fly in battle, while victory is doubtful. But if this man were a high officer, a Legislator, an hereditary Counsellor of his Sovereign, whose peculiar duty it is to set an example of bravery, of fortitude, of contempt for personal consequences in the general cause, with what feelings could we view his conduct ?" Now it is to be observed here, that all this talk about the public cause is most shocking nonsense, and what no man in the world besides one of these hirelings would be found to put upon paper. But, if to de- mand merely the fulfilment of contracts in order to preserve his fortune against the effects of deprecia- tion of money, if this be to " abandon the general cause for his own personal interests" if this be to resemble " a coward who is the first to flee in bat- tle" how will this venal man speak of the King and Royal Family and the Judges? The King has, since the year 1799, had two great grants in aug- mentation of the sum allowed him, the Junior Branches of the Royal Family have had one addi- tional grant, (in 1806,) and the Judges have, as we have above seen, had their pay doubled, actually doubled, since that time. And yet this venal man 400 PAPER AGAINST GOLD. accuses Lord King, of " BASE LUCRE," because he is endeavouring to get what is his due ; because he is endeavouring to get his own; because he is trying to protect himself against that ruin which he foresees will come upon him, if he does not now be- gin to obtain the fulfilment of his contracts. "On an occasion," says this venal man, in "which ALL suffer." No : not all. The King has not suf- fered from the depreciation, nor have the Judges, whose pay has been, as we have seen, actually dou- bled since the stoppage of cash payments took place, and who, of course, would be now as well off as they were before that time, if the pound bank note were worth only ten shillings, and Mr. HORNER tells us it is yet worth about sixteen shillings. " ALL" do not suffer, then. The Judges, so far from suffering have gained very greatly ; and yet, no one has ever charged them with motives ot " BASE LUCRE." The Judges of England alone have received, since the year 1799, in virtue of the two Acts above-mentioned, no less a sum than 120,000, that is, one hundred and twenty thousand pounds of principal money, more than they would have received had not these two grants been made to them ; and if we include the interest, as in all such calculations we must, they have received, since 1799, over and above their former pay, about 145,000. And yet, my Lord Kins: is, by this venal scribe, ac- cused' of motives of "BASE LUCRE," because he wishes to prevent the whole of his income from be- ing sunk in the depreciation of money. The Judges have actually put in their pockets this large sum of money ; they have actually touched it since the year 1799, and, of course, the National Debt is so much the greater on that account ; the interest upon that Debt is so much the greater on that account ; the quantity of bank notes to pay the Dividends is so much trie greater on that account ; and, of course, these two Acts of Parliament have tended, in some degree, to hasten the depreciation, and to produce PAPER AGAIN3T GOLD. 401 the very effect which now threatens to ruin Lord King, and to find out a remedy for which, puzzles so many men who think themselves wise. Lord King's measure does not tend to add to the National Debt ; it tends to produce no addition to the Divi- dends or the bank paper ; it is a mere measure of management of his private affairs which does not trench upon the public good in any way whatever ; and yet, he is lumped along with Jews, Pedlers, and Smugglers, and is accused of a want of pa- triotism ! This writer tells us, that it was the duty of such a man as Lord King to set an example of "'contempt of personal consequences" meaning, of course, pe- cuniary consequences, But, was it more his duty, than it was the duty of the King, the Royal Family } and the Judges ? He says that Kord King ought to have done it, as being an hereditary counsellor of the Crown. If Lord King had had much to do in counselling the Crown, the present subject would, perhaps, never have been discussed ; but, be that as it may, was it more his duty to set an example of contempt of pecuniary consequences than it was of the King ? Was it more his duty than it was the duty of the Judges ? Was no example of this sort to be expected from them, while it was to be expected from him ? And, I beg you t.o observe the wide differ- ence between the case of the Judges and that of Lord King* No new law is made to favour the in- terests of the latter ; but, a new law is made, and afterwards another new law, to favour the interests of the former. Lord King does not attempt to ob- tain any real addition to his original rents ; but there is granted to the Judges a very large real ad- dition to their original pay. The COURIER rails upon LORD KING to suffer quietly for the good of his country. His suffering would not do the country any good, but a great deal of harm. But, upon the supposition that it would do the country good, what does the same man say about the augmentation of 34* 402 PAPER AGAINST GOLD. the pay of the Judges ? When the augmentation to the pay of these persons was under discussion, Mr. PERCEVAL (who was then a barrister) argued, that the Judges ought to have quite enough to maintain them in all their state without touching their pri- vate fortunes; and, observe, this he said at the very time, in that very year, 1799, when Old George Rose, who was then one of the Secretaries of the Treasury at 4,000 a year, and who had another good 4,000 a year in sinecure places, was preach- ing up to " the most thinking people of all Europe," his doctrine of sacrifices and salvage, a specimen of which I gave you in my last Letter. " The impe- rious and awful necessity of the present crisis," said GEORGE, " unavoidably subjects US to heavy burdens. It has been said, that they ought to be considered as a SALVAGE for the remaining part of OUR property. The metaphor, though just, is inadequate; for what Tariff shall settle the differ- ence between the BLESSED COMFORTS OF RELIGION and the GLOOMY DESPAIR OF ATHEISM." George talks of " US" and of " OUR" property ; but HE was gaining all the while ; aye, and he got his great sinecure place, with reversion to his eldest son, while " imperious and awful necessity" was calling upon the nation for sacrifices. GEORGE'S doctrine of SALVAGE was for the use of others, and not at all for his own use ; nor did this doctrine of SALVAGE apply to the Judges, who, we have seen, received an addition to their pay out of the public money, during the times of this " imperious and awful necessity ;" du- ring the time that George Rose was calling upon the people, for the love of God, not to spare their mo- ney. " Oh !" said George, " it would be a slander to the sense and virtue of the people to suppose an abatement in that spirit which has enabled the Government to call forth those resources" And, at this very time he was receiving upwards of 8,000 a year out of the taxes raised upon that same peo- PAPER AGAINST GOLD. 403 pie, and Mr. TIERNEY, who opposed the augmenta- tion to the pay of the Judges, was told, that they ought to be enabled to maintain all their dignity and state ; that is to say, to live and keep their families, without touching- their private fortunes. And yet, Lord King is to be lumped with Jews, Pedlers, and Smugglers ; he is to have a hint about tossing in blankets, and kicking down stairs ; and, what is still more serious, he is to see a law passed avowedly to counteract his measures with regard to the manage- ment of his own estate ; he is to be accused of mo- tives of base lucre; he is to be held forth as an ene- my to his country ; and all this because he wishes to obtain what is legally and equitably his due ; what is his due as fairly as the produce of their fields is the due of his tenants. I have now, Gentlemen, to apologize to you for having taken up so much of your time in illustrating what was so clear itself. The additional grants to the Civil List, and the augmentation of the pay of the Judges, did not properly belong to our subject ; but, when my Lord King was reviled, and when a law was avowedly levelled at him, because he sought, in 1811, to protect himself and family against the ruinous effects of depreciation, justice demanded of me, if I wrote at all upon the subject, to show what has been done in behalf of the King and the Judges in 1799, 1802, 1804, and 1809, and especially as these measures in behalf of the King and the Judges were approved of, and supported by some of those who now reprobate the conduct of Lord King. In my next Letter, which will be the last of the series, I shall have to offer you some observations of a more general nature, and in the mean while, I remain, Gentlemen, Your Friend, WM. COBBETT. State Prison, Newgate, Friday, July 26th, 1811. 404 PAPER AGAINST GOLB* LETTER XXIX. " The true way of convincing your enemy, that his war upon your finance* will he useless, is, to sta^e explicitly to the word, that you are not at all afraid of the consequences of a national bankruptcy : lor, while you endeavour to make people believe, that su :h an event cannot possibly happen, they will certainly think, that, you regard it, if it should happen, a* irretrievable ruin and destruction; and, therefore, as you never can quite overcome their apprehensions, the best way is to be silent upon the subject, or to set the terrific bugbear at defiance. "Political Register. 18th, June, 1803. What is to be the end of all this? Paper- Money is not the cause of Sunshine and Showers We may exist without Paper-moneyEngland did very well before Paper-Money was heard of What is to become of the Fund-holders? The Sale of the Royal Plate and of the Church Property in Austria Let what will happen in England, the Jacobins and Levellers will not merit any share of the Blame Con- clusion. GENTLEMEN, WHAT, then, is to be the end of all this ? What are to be the ultimate effects produced upon the na- tion by this depreciation of the paper money ? The PITTITE party tell u&, that there is not gold to be had ; that the Bank cannot pay in gold ; and that the matter must be left to better times and to better fortune. The other party tell us, that, if they had the power of adopting what measures they pleased, they would cause the Bank to pay again in gold ; that they would restore the paper to its former esti- mation ; and, in short, retrieve the whole system. I have, I think, shown you very clearly, that to cause the Bank to pay again in gold is impossible ; and that, let what will happen, let what will take place as to commerce, or as to war, the Bank Paper will never regain any part of what it has lost, as long % as the National Debt shall exist ; or, rather, as Jong as the dividends shall be paid upon the interest of that debt. Now, if I have shown this to your satisfaction, the question, and the only question, that remains to be PAPER AGAINST GOLD. 405 discussed, is, what would be the CONSEQUENCES of a cessation in the payment of the dividends ; that is to say, the total destruction of the National Debt ; the total breaking up of the Funds and the Bank Note System. This is the only question that now remains to be discussed ; but a very important ques- tion it is, and one which, I hope, will receive your patient attention. To hear the greater part of people talk upon this subject, one would imagine, that the bank notes were the meat, drink, and clothing of the inhabitants of this island ; and, indeed, that they gave us sun- shine and showers and every thing necessary to our existence. One would really suppose, that the gene- ral creed was, that the Bank Directors were the Gods of the country, that they were our Sustainers, if not actually our Makers, that from them we de- rived the breath in our nostrils, that in and through them we lived, moved, and had our being. No won- der, then, that there should be an apprehension and even a horror inspired by the idea of a total destruc- tion of the paper money ; no wonder that when I be- gan, about eight years and a half ago, to write against the Funding system, I should have been regarded as guilty of blasphemy, and should have been accused thereof by that devout man, Mr. SHERIDAN ; no won- der that some men's knees should knock together, and their teeth chatter in their head, upon being told, that the day is, probably, not far distant, when a guinea, a real golden guinea, will buy a hundred pounds' worth of three per cents. But, Gentlemen, is there any ground for these ap- prehensions ? Are such apprehensions to be enter- tained by rational men ? No : the corn and the grass and the trees will grow without paper-money ; the Banks may all break in a day, and the sun will rise the next day, and the lambs will gambol and the birds will sing, and the carters and country girls will grin at each other, and all will go on just as if nothing had happened. 406 PAPER AGAINST GOLD. " Yes," says some besotted Pittite, " we do not suppose, that the destruction of the paper-system would put out the light of the sun, prevent vegeta- tion, or disable men and women to propagate their species : we are not fools enough to suppose that." Pray, then, what are you fools enough to suppose? What are you fools enough to be afraid of? For, if the destruction of the paper produces, and is cal- culated to produce, none of these effects, how can it be a thing to excite any very general apprehension. Who would it hurl ? " Oh ! it would create univer- sal uproar and confusion : it would destroy all pro- perty ; it would introduce anarchy and bloodshed, and annihilate regular government, social order ^ and our holy religion" These are the words that JOHN BOWLES, the Dutch Commissioner, used to make use of. This is the declamatory cant, by the means of which the people of this country have been deceived and deluded along from one stage of ruin to another, till, at last, they have arrived at what they now taste of. If, when JOHNNY BOWLES, or any of his tribe, had been writing in this way, a plain tradesman, who gets his living by fair dealing, and who has no desire to share in the plunder of the public, had gone to the writer, and, taking him fast by the button, had said to him : " Come, come ! tell me, in definite terms, what you mean, and show me how I should be a loser by this thing that you ap- pear so much to dread. None of your rani ; none of your horrifying descriptions ; but come, JOHN, tell me HOW I should be made worse off in this world, and HOW I should be more exposed to go to Hell, if that which you appear to dread were actually to take place ;" if any such man had so addressed this Treasury scribe, the scribe would have been puz- zled much more than he was by his per cents, about the Dutch Commission. Why, Gentlemen, should the total destruction of tke paper-money produce any of these effects ? Why should it destroy all property / why produce blood- P b; e ; PAPER AGAINST GOLD. 407 shed; why destroy our holy religion? I have be- fore told you, that the paper-money was unknown in England, till within about 107 years. England did very well before that time. The people of Eng- land were brave and free, happy at home and dreaded abroad, long before paper-money was heard of. Why, then, should they now believe, that, without iaper-money, they would be reduced to a state of larbarism and slavery ? The Church, as is now established, existed long before paper-money was thought of, and so did all those laws, which we yet boast of as the great bulwarks of our freedom ; and, what is more, I defy any man to show me one sin- gle law, in favour of the liberties of the people, which has been passed since the establishment of the Paper-Money System, while numerous laws have been passed hostile to those liberties. Before the existence of the National Debt and the Bank, the House of Commons used frequently to refuse to grant the money called for by the Crown ; since they have existed, no grant of the kind has ever been refused by that House. Before the Paper System existed, there was no standing army in England. Before the Paper System existed, there were not more than two hundred thousand paupers in England and Wales : there are now twelve hundred thousand. Why, then, should we alarm ourselves at what appears to indicate the approaching destruction of this System ? " Oh, but," says the Minister, (Perce- val,) "without the Paper System we could not have had the victories recently won in Spain and Portu- gal ;" to which he might have added the achieve- ments at Quiberon, at Dunkirk, at the Helder, at Ferrol, at Buenos Ayres, in Hanover, in Leon and Gallicia, at Corunna, at Watcher en, $c. $c. The list might be swelled out to three times this length ; but this is long enough. If what the Minister calls the " recent victories" are the fruit of the Paper System, so are all the achievements to which I have here called your recollection. Indeed, they were 408 PAPER AGAINST GOLD. so; for, the wars themselves proceeded from the same source. The American War grew out of the Paper System; and so did the Anti-jacobin war, which began in 1793, and which has finally produced the state of things which we now have before us. So that, as to the use of the Paper System in this way, there can, I think, be very little doubt. " Well, but, after all," some one will say, " what is to become of the Fund-holder ? How is he to get re- paid ?" My answer to this is, that it does not ap- pear to be a matter in which the people, I mean the mass of the nation^ have much to do or to say, for, what is the Fund-holder or Stock-holder ? Why, he is a man, who, choosing a large rather than a small interest for his money, has lent it to some per- sons in power, under an agreement, that he shall be paid interest upon it out of the taxes raised upon the people. A man who lends money, knows, of course, or, at least, he ought to know, the sufficiency of the borrower; or, if he does not know that, he, of course, takes the risk into his calculation ; and he can have no right to complain if the chances should happen to turn up against him. Upon this principle SIR JOHN MITFORD, (now Lord Redesdale,) went, in defending the first Bank Restriction Bill, when, in answer to those who contended, that it would be a breach of faith to compel the Fund-holder to take payment in paper, he said, that the Fund-holder, when he lent his money, knew that a case like this might happen, and that, therefore, he had no reason to complain. Till I read this, I thought that I was the only one who had held the doctrine, so that my satisfaction at seeing my opinions corroborated by such high legal authority was somewhat diminished by the reflection, that I had lost what I had deemed my undivided claim to originality. I do not, however, see any reason why the Fund- holders, or, at least, that part of them, who have been compelled to suffer their property to be thus vested, should not, in any case, have a just compen- PAPER AGAINST GOLD. 409 sation. And how ? Whence is this compensation to come ? In Austria, our old and faithful and au- gust ally, the Emperor, is acting the part of a very honest man. The paper-money in Austria has fallen to a fourteenth part of its nominal value, in spite of several Edicts prohibiting the passing of it for less than its nominal value. A hundred jlor ins in silver were worth fourteen hundred andjijty-three florins in paper when the last advices came away ; and, perhaps, one florin in silver, is, by this time, worth Jlfty florins in paper. Of course the Govern- ment creditors, or Austrian Fund-holders, must be ruined, unless something be done to obtain a com- pensation for them. The Emperor, therefore, like an honest man, has, as the newspapers tell us, sent all his plate, ail his gold and silver, in whatever shape, to the mint to be melted down and turned into coin for the payment of the people, who have lent him and his Government their money. And, besides this, the Clergy, animated by a zeal for their sovereign truly worthy of example, have given up their estafes to be sola for the sam,e honest purpose, which, doubtless, they have been the more disposed to do, when they reflected, that the debts of the Go- vernment were incurred in carrying on a war for "regular government, social order, and their holy religion," and in the producing and prolonging of which war, they themselves had so great a hand, as well as in persecuting all those who were opposed to the system. Accordingly, we see accounts in the public prints of the SALES OF CHURCH LANDS going on in Austria. They are said to sell remark- ably well ;* and, it is stated, that these sales, toge- * VIENNA, JULY 6. "A second sale of ecclesiastical estates will soon take place. On the 23d will be sold, the estate of Keixeridorf; antlon the 24th, those of St. George and Baum- garten. As there are many competitors, the sums produced by these sales have greatly surpassed what the lands were es- timated at. The body of merchants in this city published, some days since, a memoir in their defence against the char- gesobjected to them, of having contributed to the deprecia- 35 410 PAPER AGAINST GOLD. ther with the meltings of the Royal Plate, will yield enough to satisfy all the Government Creditors ; or, at least, to afford them the means of living beyond the reach of misery. But, methinks, I see start forth a Courtier on one side of me and a Parson on the other, and, with claws distended ready to lay hold of my cheek, ex- claim : u What, cold-blooded wretch ! are these, then, your means of compensation for the English Fund- holder ?" Softly ! Softly ! Give me time to speak. Do not tear my eyes out before you hear what I have to say. Stop a little, and I will tell you what I mean. Now, why should you be in such a rage with me ? If I were to propose that the same should be done here as is now doing in Austria, what would there be, in my proposition, injurious to either the station or character of the King or the Clergy ? Am I to suppose, that the Crown depends upon the possession of a parcel of plate by the King and the Royal Fa- mily ; that a throne, the seat of kingly power, is sup- ported by a wagon load, perhaps, of gold and silver dishes and plates and spoons and knives and forks and salvers and candlesticks and sauce boats and tea pots and cream-jugs ? Good Heavens ! What a vile opinion must they have of the throne, who look upon such things as tending to its support ! And then, as to the Church, what could her sons wish for more earnestly than an opportunity of giving us a proof of their disregard of things temporal ? Be- sides, there would be, in this case, a striking proof of the truth of the good maxim, that " Justice, though slow, is sure ;" for, it is well known, that the Paper System, which would thus draw upon the Church, was the invention of A BISHOP of that same Church ! But, the Courtiers and the Clergy may be Iran- tion of the paper-money. The memoir has been transmitted to the Minister of Finance, and presented to his Majesty the Emperor." PAPER AGAINST GOLD. 411 quil ; for I do not think it at all likely that such mea- sures will become necessary in England, though they have been adopted at Vienna, and, as would seem, with singular success. I am of opinion, that there would be found ample means, elsewhere, for a due compensation to those Fundholders, who had been compelled to vest their property in that way. In short, I am quite satisfied, that we have nothing at all to fear from the destruction of the paper sys- tem if that should take place ; and, as the friends of the system assert, that we have nothing to fear from its continuing to exist, we are, I think, tolerably safe. The RUIN of America and France was foretold, because their paper-money was falling ; but, the prophecy proved false. They were both victo- rious, both became prosperous ; and, what is odd enough, both have since become receptacles of the coin that is gone from England ; aye, from that country which hoped to triumph over them by the means of that same coin ! How many times did PITT predict the time when France would be what he called exhausted, and how was he hallooed on by his numerous understrappers of all sorts, verbally as well as in print ! Has she been ruined ? Has she lost in population or in power ? Is she exhausted ? Has she become feeble ? We are still struggling with her; and do we find her grow weaker and weaker ? Well, this doctrine of RUIN from a depreciated pa- per-money is a false doctrine. It was engendered in a shallow brain, and brought forth by arrogant empti- ness. But, suppose it to be sound as applied to us ; suppose, for argument's sake, that the destruction of the paper-system should take place, and should prove the utter ruin of the country ; or, suppose, at any rate, that it should send all the Fundholders into beggary, should cause all the Church and Collegiate property to be sold, as in Austria, should send the Royal Plate to the Mint, should annihilate all the remaining rights and tenures ; and, in short, should 412 PAPER AGAINST GOLD. produce a species of revolution. I say, that it need do none of this : I say, that not one of these is a ne- cessary consequence of the overthrow of the pa- per system ; but, for argument's sake, suppose the contrary, and suppose that such overthrow were to take place ; WHO, in that case, would be to blame ? This is a question that every man ought, as soon as may be, to answer in his own mind ; for, if any of these consequences were to come upon us, it would be of the greatest utility to be able to say, at once, who it was that had been the real authors of the calamity. Certainly, then, the Reformers, com- monly called Jacobins and Levellers, have had no- thing to do with the matter. They have had no power. They have been carefully shut out from all authority. They have filled no offices of any sort. They have been held forth as a sort of enemy in the bosom of the country. There is no creature who has had power, of any sort, no matter what, who has not employed that power upon them. They have been either killed, banished, ruined, or, at the least, beaten down, and kept down. Well, then, they will not come in for any of the blame, if things should turn out wrong at last. They have had no hand in declaring war against the regicides of France ; they have had no hand in forming leagues, in voting sub- sidies, in sending out expeditions ; they have had no hand in making loans or grants ; and, therefoie, they will, surely, not come in for any share of the blame which shall attach to the consequences. They have been represented as an ignorant and factious herd, " a low, degraded crew ;" while those who have thus described them have had all the powers and the resources of the country at their command ; and. therefore, let what will happen, the Reformers will have to bear no portion of the blame. The full- blooded Anti-Jacobins ; the members of the Pitt Club ; ail the numerous herd of the enemies to Re- form, may be fairly called upon for a share of respon- PAPER AGAINST GOLD, 413 sibility ; but, to the Reformers who had no power, and who have been hardly able to exist in peace, no man can reasonably look. I shall now. Gentlemen, after nearly a twelve- month's correspondence, take my leave of you, and with the conviction, that I have done much towards giving you a clear view of the subject of which I have been treating. I had long entertained the design to make the subject familiar ; to put my countrymen in general beyond the reach of decep- tion on this score ; to enable them to avoid being cheated, if they chose to avoid it ; and a suffi- ciency of time for the purpose being furnished me, it would have been greatly blameable in me, if I had neglected to avail myself of it : I have not been guilty of this neglect ; I have, with great care and research, brought together what appears to me to be the whole, or very nearly the whole, of the useful information relating to the paper system ; I have laboured most zealously and anxiously for the accomplishment of the great object in view ; and it more than repays me for every thing to hear, to see, to know, that / have not laboured in vain. In the course of this work, I have clearly ex- pressed my opinions as to the final fatal effect of the paper-money : those opinions are in direct op- position to those of the Ministers and the Parlia- ment. TIME, the trier of all things, must now decide between us ; and, if I be wrong, I have, at least, taken effectual means to make my error as conspicuous and as notorious as possible ; while, on the other hand, if I be right, I have laid the sure foundation of complete triumph over my haugh- ty, supercilious, unjust, and insolent foes. One tning, above all others, however, I am desirous of leaving strongly impressed upon your minds, and that is, that it is my decided opinion, that, let what will be the fate of the paper-money, that fate, how- ever destructive, does not necessarily include any, 35* 414 PAPER AGAINST GOLD. even the smallest, danger to the independence of England, or to the safety of the throne, or to the liberties or the happiness of the people. I remain, Gentlemen, Your friend, and obedient Servant, WM. COBBETT. State Prison, Newgate, Friday^ August 2d, 1810. TO THE LABOURERS OF ENGLAND, On the projects for getting them out of their native country. Kensington, 25th June, 1831. MY FRIENDS, THE London newspapers tell us, that the news- papers in the country are full of " forebodings as to the designs of the labourers ;" and the " Morning Chronicle" of the 25th June, having told us this, adds these words, " There is an article in the Kent Herald, of Thursday, which is worthy of particular attention. Dearly, do we fear, will England yet rue the having, of late years, legislated only for the high- er classes, and abandoned the lower to every descrip- tion of tyranny." This Morning Chronicle is a paper on the sid>e of the ministers, and, therefore, it says what k pleases : if I, who am on the side of no men in power, were to write this, I should be prose- cuted for it. However, why does not this paper give us this famous article from the Kent Herald ; and why does it not give us some of those dismal fore- bodings of the country newspapers with regard to your designs? I, however, want no information upon the subject, for I know your designs, and I high- ly approve of them ; namely, first, to secure for yourselves, in return for your labour, a belly-full of meat and bread; and, next, to obtain some good wholesome beer, to wash them down ; and also to obtain good and decent clothes, and clean bedding, such as your grandfathers had. These are your de- signs, and God send that they may be accomplished, instead of being a subject of " ominous forebodings." But now, upon these projects for getting a part of you out of the country. Those that are for these pro- 416 TO THE LABOUHER3 OF jects say, that you are too numerous ; that you breed too fast ; and that there is not work enough for you ; and they say this at the yery moment when the farm- ers, all over the country, are complaining that they shall not be able to get in the harvest without the assistance of Irish labourers ! I have often proved that there is plenty of employment for you ; that the farmers wish to give you that employment, but that they have not the money to give you ; and this has also been stated recently by Lord STANHOPE before a committee in the House of Lords. The cause of the farmers not having money enough to give you is, that they are compelled to pay tithes and taxes to an enormous extent ; and you want higher wages than you otherwise would want, because you pay taxes on your malt, hops, sugar, soap, candles, tobacco, and, in short, on every thing that you consume ; while the numerous enclosure-bills have taken from almost the whole of you the means of keeping cow, or pig, or goose. I have frequently told you, that there is a man of the name of MALTHTS, who "is a church parson, who was the great inventor of the doctrine, that it is your breeding so fast that is the cause of your misery. This man has long been a great favourite with the greater part of the law-makers and ministers, and it has recently come to light, that he has been, and is in the pay of the government, and that he has been re- ceiving, and is receiving, a hundred pounds a year for his literary services. That which he has' re- ceived would have wholly maintained nine or ten labourers 5 families. Such transactions as this form part of the cause of your misery ; but, though this is as clear as day -light to me and to every man of sense in the kingdom, still the schemers are at work to get some of you away; to get some of you out of that country in which you were born, while they suffer swarms of Italians. Jews, and Germans, hurdy-gur- dy grinders, broom-sellers, and Scotch pedlers. to swarm over the land, like lice upon the body of a dis- TO THE ULBOUAER3 OF E*GLA*D. 417 eased animal. They suffer all these to remain and wander whither they like, and are busy about no- thing but getting out of the country those who till ike land and make die clothe? and the houses. Swarms of pensioners and sinecure-holders, paid out of the taxes ; swaiias of retired clerks, and military officers, and doctors ; saims of idlers, of all descriptions, they suffer to remain, and wish to get rid only of those who do the work, and who, if necessary, are able to defend the country. In a farmer number I endeavoured to amuse TOO. 'under the form of a farce, with an exhibition of the folly of these people. Upon the publication of that farce, a man calling himself EDWABD LCDU>W, who is a partisan of these getters- rid of the people, wrote me a very abusive letter, at the close of which he put to me five questions rela- tive to population. I answered these questions, which contained the doctrine of the whole crew ; and those questions, together with my answer, I will new lay before you. I pray you to read the whole with great attention, and to hand it about from one to the other; and when you hare read this, I shaU have other, and, to you, still more important matter to lay before you. * LCDLOW'S QJ7E3TKMH." " 1. Stock a farm of 1000 acres, of the richest pas- ture land, with one breeding pair of the ox, horse, and sheep tribes of animals ; leave them to multiply, in obedience to the unrestrained instincts of nature, and will they not multiply until the said pasture is usable to maintain the augmented numbers otherwise than in a state of the most severe privation under which animal life can possibly exist? ** 2. Would not the same result inevitable occur if the whole island of Great Britain were of the richest posture, and similarly stocked? "3. To keep down the mouths on his pasture to a level with its capacity to feed them, does not the gra- 418 TO THE LABOURERS OP ENGLAND. slaughtering the animals of all ages, removing them away from his land, incapacitating them from breed- ing, by separating the sexes, and by other means ? And if he were not so to do, would not his farm in- evitably in time be overstocked ? " 4. Is not the multiplication of all classes of ani- mal nature, biped and quadruped, or man and beast, governed by the very same laws or principles ? " 5. If the aforesaid violent means of physical pre- vention, applied, as aforesaid, to the multiplication of four-legged creatures, cannot be applied to that of two-legged creatures, will not the latter inevitably overstock the country, unless their excessive multi- plication be prevented by some moral restraint thereon ? " When you show that you clearly understand the preceding very simple questions, and the proper an- swers to them, I may probably propound some others which may lead to the elements of the momentous, complex, and beautiful science, that treats of the multiplication of the human species, viewed with reference to its highest attainable state of well-being. " You are at liberty to publish this letter, but / guess you will take good care to do no such thing. 'EDWARD LUDLOW." " COBBETT*S ANSWER." Now, nasty feelosofer, I answer the four Jirst questions with a YES ; but the fifth I answer with a NO. Here we have, then, the grand argument of the shallow and nasty beasts ! Here we have the basis of their "momentous, complex, and beautiful science." The nasty creatures know, that nobody can deny the truth of their observations, as they ap- ply to stock, kept upon a farm ; and not being able to discriminate between that case and the case of a nation, they think that their conclusion is unan- swerable, and they rush on to it with all the eager- ness and glee of a conceited fool who imagines that TO THE LABOURERS OE ENGLAND. 419 he has discovered some hitherto-hidden idea that he is bringing forth. If the mind of this fellow were not as stupid as it is nasty, he would have perceived that there is no analogy in the two cases ; that a nation, or people, have to provide for their own wants, have to create by their own skill, care, and toil, that which they eat, drink, wear, and are warmed and lodged with ; where- as the stock upon a farm have their wants provided for by others; they create nothing-; they use no skill, no care ; they labour not at all ; but have every thing provided for them by the skill and labour of man, and the labour of those other animals that man calls in to his assistance. It is curious to observe how this nasty-minded fel- low, resting upon the propensities and tendencies of nature, flies off, at once, for an illustration, into a state wholly artificial, and talks of the multiplica- tion of animals in this state, instead of animals in a state of nature, where they have to provide for their own wants, and to seek for the means of their own defence and preservation. What ! nasty, impudent, and stupid beast, you want to show us how fast ani- mals would increase, if left to the " unrestrained in- stincts of nature," and as a proof of it, you cite what would be the increase of a flock, guarded during the day by the shepherd and his dog, folded at night, and pampered upon grass, clover, and turnips, cre- ated for them and almost put into their mouths, by the labour of men and horses ! You are a pretty beast to reason upon analogy ! you are a pretty beast to show us what would be the effect of leaving ani- mals to the " unrestrained instincts of nature !" To make your argument of analogy worth a straw, you ought to have gone for an illustration, not to flocks and herds, tended and fed and nursed and phy- sicked by the hand of man, but to those untamed animals which acknowledge no owner, and which provide for their own wants and their own protection. Of these the sparrow, the rook, the rabbit, the hare, 420 TO THE LABOURERS OF ENGLAND. the pheasant, the wood-pigeon, the partridge, and some others, are, in part, provided for by man ; yet it is not without great difficulty that some of them can be made to increase. But the foxes, the badgers, the otters, the weazels, the stoats, the pole-cats ; why do they not overrun the country ? They are killed by man and other animals ; aye, now and then one, but not in so great a proportion as men are killed in va- rious strifes, and by accidents arising out of their state in civil society. And why do not these animals (all great breeders) cover the land then? They are left to the " unrestrained instincts of nature ;" aye, but they are also left to get their own living ; to work for what they eat. Mice and rats, indeed, ab- solutely demand cats and traps to " check the popu- lation" of them ; and, why ? because the food on which they live is provided for them by the hand of man. Take that artificial provision away, and there will be no need of cats and traps to keep them down. And magpies, now, why do not they fill the woods and devour us ? Who ever kills a magpie ? The most artful of birds, the most vigilant, so nearly a match for the hawk, that the latter never attacks him. Seldom is his nest molested ; and yet this is rather a rare bird. And why ? Because he is compell- ed to pass his time in watchings and in labour. Feed the magpies, and take care of them, and they will be as plentiful and as insolent as pensioners, and you must soon begin to eat them, (sweet morsels !) or to kill them at least, or they \\ill fill the air with their chattering. I found, at Barn-Elm, a dove-house with about fifty pair of pigeons. I let them get their own living : in the three years they did not give \isfifty young ones, and their population fell ofl', at last, to about fifteen pair. I had a little pigeon-house at Kensington, set out with four pair, that soon began to take enough young ones for a pigeon-pie once a week ; and yet, in about two years, they increased to such numbers, that I was compelled to slaughter the whole by shooting, and to begin again. But TO THE LABOURERS OP ENGLAND. 421 here they were fed three times a day abundantly, and whenever they went from home it was tor di- version, and not to seek food. Here was u surplus population;" and here was the cause. These lazy devils at Kensington got all the food and none of the work ; and therefore I was compelled to " check their population," and finally to destroy them. The hiackbirds and thrushes sometimes rob a man a little, but the torn-tits, goldfinches, nightingales, swallows, martens, hedge-sparrows, and peckers, and numerous other birds, live wholly on worms and buds and insects and seeds of weeds. There is never any overstock of them, though nobody kills them ; but there would be an overstock of all of them, if man were to feed them, and to provide them with nests and protection, and were never to destroy any of them. My little farm-yard at Kensington, contains, at present, two cows, a bull calf, two old sows, five male pigs, and seven females, all these about three months old, two cocks, ten hens, and about seven- teen pigeons. Here, if I were to let them all remain in their natural state, to pursue the "unrestrained instincts of nature," and to go on calving, pigging, and hatching, there would be a goodly assemblage in a short time: there would be a "surplus popula- tion" indeed ! But, then, 1 must continue to feed them all: I must continue to draw from my garden subsistence for them,/rom the fruit of my care and the labour of my men in the raising of the cabbages, turnips, mangel-wurzel, and corn, on which they all live. Upon this, and this alone, I ground my right to " check their population," by killing the calf as soon as he is fit, by taking the milk from the cows, by altering, (as the Yankees call it,) and, afterwards, killing the pigs, by taking the eggs from the. hens, and by taking the young pigeons from their nests and putting them into pies. If I were to leave them to provide for themselves, their population would need no checking ; and if they were to be so situated as to be able to get their own living, they would hardly 36 422 TO THE LABOURERS OF ENGLAND. breed too much, because their numbers could increase only in proportion to the subsistence that they obtain- ed, and that, too, without injury to others ; for, if they committed such injury, they would be destroyed in proportion to the amount of that injury ; and this de- stroying would keep their numbers within due bounds. It is exactly the same with human beings, who, if they labour, never CAN breed too fast, because they create food and clothing and other necessaries in proportion to their numbers, and because, indeed, the subsistence must precede the population. But if there be a government to step in, and wrest the sub- sistence from those by whose labour it is created, and hand it over to others who, like my farm-stock, create nothing, then the poor souls that do the work must suffer from want. This is the situation of England at this moment ; and here is the real foun- dation and motive of all that we hear about " surplus population." Those who labour, those who create all the food and all the raiment, seem, at last, resolved not to live any longer in a state of half starvation ; and, therefore, those who live in idleness on the fruit of their labour, are using all sorts of endeavours to make us believe that the working people are too nu- merous, and these devourers are worrying the Go- vernment to death to adopt some scheme for thinning their numbers, not caring a straw about what the country must thereby lose in point of resources and strength. These idlers are, in one respect, not like my farm-stock, for they yield nothing- in return for what they devour. They are like the nags and plea- sure fillies, who, finding the clover run short, pe- titioned the master to sell off, or kill, some of the cart-horses, of whom they alleged that the population was " surplus." " Oh, no !" said the master, " if there be not enough for all, I must get rid of some of you ; for you create nothing, and without the cart- horses, we shall all be starved together." There may, indeed, be a real " surplus popula- TO THE LABOURERS OP ENGLAND. 423 tion" of idlers ; and this is the case in England now , a real surplus of nags and fillies ; these are crying out for a diminution of the number of the cart-horses, and, contrariwise to the farmer, our Government is listening to the clamour of these luxurious idlers, and seems to be as busy as bees in contriving schemes for checking the breeding and getting rid of those who do all the work and create all the resources of the country, while, at the same time, that same Go- vernment does not one single thing to check the breeding, or to get rid, of those who live in idleness out of the fruit of the working people's labour, and who are mere consumers and wasters of the nation's resources. Let us try this a little, as the Yankees say ; let us resort to an illustration, and see if we cannot find a better one than that of this nasty feelosofer, " EDWARD LUDLOW," who, by-the-by, does not tell us where he is to be seen or heard of. If "EDWARD" should happen to know JOHN CAM " HOBHOUSE, ESQ.," who is a member under SIR GLORY,* for the city of West- minster, and who, along with his master, was so pelted with cabbages and turnips, at the election in Covent Garden, last summer; if "EDWARD" should happen to know "John Cam, Esquire" that will be just the thing; for then he will have the illustration. complete. John Cam married a JULIANA HAY, who was a pensioner from her infancy. There were two broods of these Hays standing on the pension list ; but one will be enough for our purpose. " Grant, dated 1807, to James Earl of Lauderdale and others, in trust for Mary Turner Hay, per year, - - 100/. Dorothy Frances Hay, ... - 100 Hannah Charlotte Hay, - - - 100 Elizabeth Hay, - 100 James Hay, 100 Juliana Hay, 100" * Sir Francis Burdett. 424 TO THE LABOURERS OF ENGLAND. Now it is very clear that u EDWARD LUDLOW'S" doctrine would apply here ; for here the parties create nothing. I will not compare such delicate ladies to " stock upon a farm, ;" but " like the lilies of the field, they toil not, neither do they spin." They do no work, they create nothing useful, they make come neither food nor raiment nor fuel nor bedding nor houses ; therefore, they may easily be too numerous ; because they do not, like the working classes, create subsistence in proportion to their numbers ; they draw their subsistence, or, rather, the exciseman draws it for them, out of the fruit of the labour of others, just as the farmer brings the food to his pigs out of the fields which have been ploughed and sowed by him and the horses. Such people, therefore, if left to follow the " unrestrained instincts of nature," and if fed in proportion to their numbers, must soon actually cover the face of the earth, and devour up every thing upon it. But suppose that LADY JULIANA had not had the exciseman to draw subsistence for her from the fruit of the labour of the Scotch people, (it is a Scotch af- fair,) how would the case have stood then? She must have worked for what she ate and wore ; she might at this moment have been weeding in the corn, and by-and-by hay-making, reaping, and then hop- picking, and in the winter, spinning and knitting. In that case, she would have created as much as she consumed ; she would have been no surplus ; and if she had increased there would have been no harm, because her increase would, in the usual course of things, have brought " a proportionate increase of subsistence." Let " EDWARD LUDLOW" go and ask JOHN CAM (if he be acquainted with him) whether this be not sound doctrine; and when he is about it, to make the illustration more ample, he may ask the Squire how the case stands with regard even to the Squire himself who is one, they say, of a family of TEN CHILDREN, and whose father has, as " Com- missioner of Nabob of ArcoCs Debts" (O Lord !) TO THE LABOURERS OF ENGLAND. 425 received about fifteen hundred pounds a year for near- ly, or quite, the last thirty years ; and, of course, about forty-jive thousand pounds on the whole, [216,000 dollars.] Here again the doctrine of " LUDLOW" applies : here is Cl surplus population :" here, if the parties were left to the " unrestrained instincts of nature," they would certainly devour up the earth itself in time. But if these ten persons were not thus pro- vided for out of the fruit of other people's labour, they might now be all engaged in occupations in which they would, in some way or other, be producers of food, clothing, houses, ships, or some other things necessary to man ; and then the addition that they would make to the population would be no surplus ; because they would, by their labour, cause a propor- tionate addition to the food and other things neces- sary to man, and necessary to the support of the power of the country. The conclusion, then, is this : that of those who create useful things by their labour, either of hands or head, there never can be too many in any country ; because they will create subsistence in proportion to their numbers, and there will be less population in a given space of unproductive land than in the same space of productive land, because the subsistence must exist before the new mouths can come; but that, of those who create nothing useful, there may be, as there is now in this country, a great surplus population, and this may be so prodigious as to pro- duce something very nearly approaching to general famine, as is the case at this moment in Ireland, whence the idlers bring away so much as to leave not a sufficiency even of the accursed root to keep the producing classes from starving. To bar all cavil upon the subject, let me add, that I do not include amongst the idlers, lawyers, doctors, or teachers of any sort, as far as they be necessary in a country ; nor the makers and administrators of the laws ; nor soldiers, nor sailors, necessary for the de- 36* 426 TO THE LABOURERS OF ENGLAND. fence of the country. These assist those who create and who convey from hand to hand the things cre- ated by securing to them protection and peace, and the enjoyment of the things created. The owner of the land is no idler ; for the land is necessary to all ; and without an owner it could not be advantageously used. But those who draw their subsistence from, those who labour, without adequate services in return ; these are the idlers ; and they do not deserve to be put on a level with stock upon a farm, because these we, first or last, turn into meat, shoes, or coats ; whereas the idlers, like the vermin that suck our blood, or those that eat up our victuals in our cup- boards, are, in their lives, our torment, and, in their deaths, our disgust. There, nasty "EDWARD LUDLOW ;" now go and put forth your scheme for sending the working-peo- ple away, or for " incapacitating them from breed- ing ;" and then go to some farm-yard in the north of Wiltshire, and, as the reward for discovering your " beautiful science," have your brains knocked out by the milk-maids against the posts of the cow-cribs. WM. COBBETT. TO THE LABOURERS, On the folly of their putting their Money into Clubs. Kensington, Jan. 1, 1832. MY FRIENDS, It is the general practice of those who invent some- thing to delude and cheat other people, to give a good name to the thing which they invent ; and, accord- ingly, those who have invented this scheme for inr ducing you to give up your earnings, to prevent them from paying poor-rates, have christened these clubs " BENEFIT clubs," instead of calling them, as they ought to have done, clubs to wheedle money out of the hard-earned pence of the working-peoplej in TO THE LABOURERS OP ENGLAND. 427 !er to spare the purses of the landowners, big farmers, and other rich men. It was not till about seventy years ago that clubs like these were ever heard of in England. Before this Protestant Church of England sprang up, the poor were relieved out of the tithes. Since that, the parsons, the bishops, the deans and chapters, and the nobility and gentry, have taken all the tithes to themselves; and the poor have been relieved by what are called the poor-rates. The same may be said with regard to the church-rates, which also formerly came out of the tithes. There needed no clubs before this Protestant Church establishment came, because the priests re- lieved all the poor out of the tithes, and out of the rents of lands, and other property, which had beea bequeathed to the clergy for that purpose. There was therefore no occasion for poor-rates, for all poor persons were sure to be taken care of, whether in sickness or in health, to the end of their days ; and besides, so happy was the state of the country, that there were few persons poor in any one parish ; the wages paid to labourers were so good, that no man who was able to work, ever stood in need of relief; and in case of sickness, people in general were so well off, that there were few who could not be con- veniently relieved by their relations. This fatal change took place about two hundred and fifty years ago; and it is about two hundred and thirty years ago that the poor-rates weie enacted. For many years poverty was not so great, wages were not so low, in proportion to the price of provisions, as to compel many persons to apply for parish relief. When I was a boy, it used to be deemed a shame to apply to the parish. But the desolating and ex- travagantly expensive, and long and bloody, wars of George III. plunged the nation into debts, so great, made the taxes so heavy, and made wages so low, in proportion to the price of provisions, that labour- ing men were compelled, in case of sickness espe cially, either to expose their families to be starved, 42S TO THE LABOURERS OF ENGLAND. or to obtain assistance greater than their relations 'were able to give them. In this state of things the cunning fellows, who had to pay the poor-rates, in- vented what thej called " BENEFIT clubs," which was a scheme for drawing out of the wages of the labourers, who were able to work, the means of re- lieving those who were unable to work; or, in other words, to make the healthy labourers pinch their bellies and their backs, in order to relieve the sick labourers, and thus save the pockets of these cun- ning rich fellows. Every penny that a labouring man pays into these clubs, is a penny given to the rich ; and, besides that, it is a penny given to uphold Sturges Bourne's bills, and to pay hired overseers, and in short to nay for causing himself and his neighbours to be put into harness and to be made to draw carts and wagons like beasts of burden. If you could have any doubt in your minds about the tendency of these clubs, you would only have to look at the persons who are the most eager to promote such clubs, and to uphold them and perpetuate them. There was a fellow, some years ago, a Scotch fellow, named OLD GEORGE ROSE, who had been a purser in the navy ; who was a famous tool of the famous Pin ; from a PURSER he became a right honourable privy councillor / he received for many years not less than ten thousand pounds a year of the public money ; he got a sine- cure place settled upon him for life of three thousand pounds a year, and settled upon his son, GEORGE ROSE, for his life also. This man became, about forty years ago, the great promoter of benefit clubs ; he lived at Cufihells. in the New Forest, in Hamp- shire ; he was himself a member of a club there ; he used punctually to pay in his pennies ; he used 'to dint with the club ; and thus he drew in, thus this cunning Scotchman humbugged, all the poor chop- sticks about that country, taking good care never to tell them that his carriages, and horses, and fine park, and deer, all came out of their labour. TO THE LABOURERS OP ENGLAND. 429 Another great patron of benefit clubs is that FLEM- ING, (whose name was WILLIS,) who was lately a member for Hampshire, and who was so pelted off the hustings at Winchester. Can this man want to do good to the people ? Can he be the friend of the working people ? Can he, who was the tool in the hands of the parsons in Hampshire, mean to do the working people any good ? Besides, you see all the greediest of the big farmers, the most eager to pro* mote and uphold these clubs. Then, again, mark the conduct of the Govern- ment ! What business had it and the Parliament to meddle with the affairs of these clubs ? W r hat right had they to interfere with the management of these concerns ? What right had they to meddle with the management and distribution of money belonging to the members of a club, any more than with money belonging to any partnership whatsoever ? Yet they have interfered ; they have passed laws to give their magistrates a superintending power over these clubs ; they have passed laws to prevent the mem- bers from dividing the money at their own pleasure ; they have passed laws which, in effect, take the money from under the command of the members of the club ; and, in a great measure, take it away and make it a part of what is called the national debt. The savings banks, as they are called, were in- vented by that same cunning Scotchman, old GEORGB ROSE. The money collected by these things is, what is called, put into the funds, and the poor people imagine thai the funds mean a chest or box where the money j* locked up. Alas ! my poor friends, there is no such chest or box ; the funds mean the national or government debt ; and the putting of money into the funds is the lending of money to the Government ; and the Government pays the interest of it, not out of any fund that it has, but out of the taxes, a part of which you pay in every gallon of malt, pot of beer, pound of sugar, bit of soap, or can- dle, that you consume, and upon every bit of tobacco 430 TO THE LABOURERS OF ENGLAND. that goes into your mouth ; so that, first, you put your earnings into the clubs, or the hanks ; next, the Government borrows it; and next, if you ever get any interest, you get it out of the taxes that you your- selves have paid ! Nothing that ever was heard of in the world before is equal to this delusion and folly on your part ; and to the craft of those who induce you to put your money into these clubs and banks. When a club man is ill, the parish give him no re- lief; because he has an allowance out of the club. When a man becomes seventy years old, he has an allowance from the club for the rest of his life ; and, whether sick or well, the parish never give him any relief to the day of his death ! One would think that this was enough to open your eyes : one would think that here was enough to make you see why the big, the grasping, the grinding farmers, are so eager to get you into clubs, " into benefit clubs ;" that is to say, into clubs that are of great benefit to them, and of great injury to you ; here is enough to make you see why they do you the honour to come and dine with you once a year, though all the rest of the year they treat you far worse than they treat their dogs. If a man earn more money than is necessary to supply him with food and with raiment and the other things that he wants, cannot he keep Ms money him- self? Cannot he take as good care of it, as the grinding farmers and the Government can ? yes, and if he happen to be sick, he has relief from the parish, and his own money too, and he ought to have both ; for the money that he has saved he ought to keep till old age, as the just reward of his extraordinary in- dustry and frugality. A drunken and dissolute life produces illness ; and as there will naturally be some drunken and dissolute persons in the club, they will be sick oftener than the rest ; so that the sober and orderly man has to work to maintain the profli- gate in his sickness. Then, again, some men have hereditary diseases, such as consumption and king's- evil. These unfortunate persons aare entitled to TO THE LABOURERS OF ENGLAND. 43 I compassion from the healthy labouring man ; but they are entitled to support from the lands of the parish, and ought not to be made in this manner to extract their maintenance from the healthy labouring men. The depositing of money in this way, has a very bad moral effect ; it makes men less careful to ad- here to such conduct as is necessary to the preser- vation of health. It tends to make them drunkards, and to be less cautious how they expose themselves to bodily harm. In many cases it makes them suc- cessful hypocrites ; makes them either sham illness altogether, or to affect its existence after it has ceased. But, after all, and if all the other objections were removed, what sense is there in the thing? What is there in it but pure folly ? What is there in it but giving away your money ? All the men that enter the club must be young and healthy at the time ; and why should a young and healthy man give his money to any body else to keep for him against a day of sickness ? Either he pinches his back or his belly for the sake of lodging this money in the club, or he has this money over and above that which he wants for his back or his belly ; if the former, then he enfeebles himself; makes himself a poor mean- looking fellow ; undermines his health and strength, solely for the advantage of those who live in luxury and splendour on the fruit of his toil: if the latter, why not keep the money in his own chest ? In the course of the year he pays thirty or forty shillings into the all-swallowing club. In the course of five years he pays in ten pounds perhaps. But suppose it to be only twenty shillings a year, how many times does a man see an occasion in which, by the means of this little bit of ready money, he could, to very great advantage, purchase a pig, plant a bit of ground, or do something by which the money would produce him more to eat, drink, or wear, than two pounds laid out from hand to mouth ? Many are such occasions that present themselves ; but you cannot avail your- 432 TO THE LABOURERS OF ENGLAND. self of them, for your money is locked up in the club. You cannot brew without malt, and hops ; the club has got your money, and you must go to the ale- house, and purchase your beer by the pot. So that these clubs, view them in what light you will, are injurious to the working people, and serve no other purpose than that of making their lot harder than it would have been without them. Young men deem a bastard child a great burden ; but, not to mention, that, in this case, there has been something like value received, and that time, and reasonable time too, takes the burden from your shoulders, which, besides, you may at any time remove by doing justice to the mother : whereas the club sticks to you all your life long, while you have health and strength sufficient to enable you to sit all the day and crack flint stones with a hammer. Therefore^ my advice to all young men is, Never give a farthing to one of these clubs ; and if you have begun to give, cease to give immediately ; to have been foolish, is no reason for being foolish still; and be you well assured that the first loss is the best. Stuck on to one of these clubs, you cannot remove out of the kingdom ; nor even very well from one part of the kingdom to the other, without losing all that you have put into this craftily-contrived trap. Get out of it if you be in ; keep out of it if you be out ; and trust to God, to your own industry, and so- briety, and to the law of the land, for aid in case of sickness ; and thus merit the commendation of Your friend, WM. COBBETT. THE END. 14 DAY USE RETURN TO DESK FROM WHICH BORROWED LOAN DEPT. RENEWALS ONLYTEL. NO. 642-3405 This book is due on the last date stamped below, or on the date to which renewed. Renewed books are subject to immediate recall. MA* s lu^ ^O* V i\j()U f> r% rv y-^ 2 ~ff , JUS 6 "89 .A Mi DECEIVED nn 1 1 m 2 2003 jAr CIRCULATION DE DT * 02 2003 , ''0167245 ?s .G7