how a well-bred man, a man of delicacy, would have acted under such
circumstances. He would have given the money to the poor and thrown the
purse into the fire. I will do for you what you should have done
yourself.’
“And approaching the fireplace, Marsanne dropped the purse upon the
glowing embers, which instantly consumed it. There was something noble
and solemn in the action of the Count’s; the blood of the French
chevaliers, those loyal subjects of beauty, had been stirred in the
veins of their descendant by the recital of this blamable act of
curiosity. Marsanne continued:
“‘Allow me to tell you, sir, that the men of your generation, accustomed
to live with courtezans, and to seek venal and ready-made loves, are
ignorant of what is due to women because they are women. None make more
allowance than I do for the levities of youth. But what I blame is, that
in utter wantonness, and for the gratification of an idle curiosity, you
lift the curtain shrouding a secret, and pour out misery and desolation
upon a poor woman, more deserving, perhaps, of censure than of utter
condemnation. Be not more severe than a husband,--you, a young man,
liable to profit by such errors; and remember that a true gentleman will
respect women even in their weaknesses. Weigh my words, M. de Movillez;
you will not be offended at my frankness.’”
A few hours after this scene, the Countess do Marsanne, alone in her
boudoir, and busy with her embroidering frame, receives a visit from her
husband. Just returned from one hunting-party, and about to start upon
another, the incorrigible sportsman is seized with remorse at the
solitude to which his wife is condemned, and, touched by her resignation
to a lonely and cheerless existence, he generously resolves to sacrifice
his own pleasures to her happiness. He proposes that they should go to
Italy, and pass the winter at Florence or Naples, where he trusts to
wean himself from the chase and acquire a taste for domestic enjoyments.
The Countess refuses to take advantage of the generous impulse,
professes her sincere friendship for her husband, but avows that her
love for him has fled, driven from her heart by suffering and neglect.
“At this moment Madame de Marsanne’s maid came to tell her that her
bedroom was ready for her reception. Then she added:
“‘I have looked every where for the purse of Madame la Comtesse, but it
is no where to be found.’
“At these words, Marsanne’s countenance assumed a singular paleness, and
it was all he could do to master his emotion and say to his wife:
“‘You have lost your purse?’
“‘Yes,’ replied the Countess, unobservant of her husband’s agitation;
‘or, rather, I have mislaid it in some corner.’
“‘It was doubtless of value?’
“‘Oh! by no means. A little green silk purse, my own work, and nearly
empty.’
“The Count remained motionless, like a man struck by a thunderbolt.
“‘You have no commissions for Plessy?’ he at last articulated, breathing
short and quick, and not knowing what he asked.
“‘I thought you just said you were going to Orleans,’ replied the
Countess.
“‘I shall visit Plessy on my return.’
“‘Then kiss my little godson Henriot. Much pleasure to you; and return
as soon as possible.’
“Marsanne raised the Countess’s hand to his lips, and left the boudoir;
but he staggered like a drunken man, and was obliged to support himself
by the bannister in order to reach his room.
“Towards the middle of that night, a belated passenger through the Rue
d’Anjou would have witnessed a curious spectacle. Although the cold was
intense, a window was wide open, and by the light of a lamp a man was to
be seen leaning upon the balustrade. From time to time, deep-drawn sobs
of rage and despair burst from his breast, and he violently pressed his
head between his hands, as if to prevent it from splitting. This man was
the Count de Marsanne.
“The following morning a hackney coach, containing a lady closely
veiled, had scarcely turned from the Rue Miromesnil into the Rue Verte,
when a man, who for some time previously had paced to and fro, muffled
in a large cloak, paused at No. 17 in the former street, dropped the
folds of his mantle, and took off a pair of huge green spectacles that
had previously concealed his face. The Count de Marsanne, for he it was,
remained motionless beside the door whence the coach had driven. From
his extreme paleness, and the gloomy immobility of his features, he
might have been taken for a statue of stone.
“The hackney-coach was scarcely out of sight, when Vassigny appeared at
the door of No. 17. On beholding him, the Count’s eyes sparkled; he
extended his hand and seized Vassigny by the arm.
“‘Will M. de Vassigny,’ he said, ‘honour me with a moment’s interview?’
“Don Juan, dragged towards the abyss by the statue of the Commanditore,
cannot have experienced such a feeling of terror as at that moment took
possession of Vassigny.
“‘Sir,’ ... he stammered, ‘I know not....’
“‘I ask an interview, sir,’ said the Count, with sinister calmness; "I
have grave matters to discuss with you; we should not be at our ease in
the street; will you be good enough to conduct me to your house.’
“‘Really I know not what you mean.’
“‘I repeat, M. de Vassigny, that I have things to say which none but you
must hear. Be so kind as to lead the way.’
“‘My house, as you know, is in the Rue de Provence,’ said Vassigny, with
a constrained air. ‘I shall be happy to receive you there.’
“‘Let us go,’ said the Count.
“They walked in the direction of the Rue de Provence. By the time he
arrived there, Vassigny’s emotion had attained the highest pitch, and
his legs bent under him as he ascended the stairs.
“A servant introduced the two men into an elegant drawing-room.
“There was a moment of terrible silence: Marsanne seemed to have shaken
off his gloomy despair: inflexible resolution was legible in his eyes.
Vassigny, on the contrary, appeared exhausted and overcome, a criminal
awaiting sentence of death.
“‘You have seen Madame de Marsanne this morning,’ said the husband, with
strange solemnity.
“‘Madame de Marsanne!... In Heaven’s name, you are mistaken!’ cried
Vassigny. But his tone of voice, and the wild expression of his
features, fully confirmed the Count’s words.
“‘You have seen Madame de Marsanne this morning,’ repeated the Count. ‘I
know, sir, that as a man of honour, you are incapable of betraying a
lady’s secret; but I prefer the evidence of my eyes even to your word.’
“‘Well, sir, my life is yours--take it!’ cried Vassigny, casting towards
heaven a glance of rage and despair. Marsanne gazed at the young man for
a brief space, and then resumed.
“‘Listen to me, M. de Vassigny, The law authorised me to assassinate
you, but that is not a gentleman’s revenge. The law further authorised
me to have my dishonour certified by a commissary of police, and to drag
you before the tribunals for condemnation--to six months’ imprisonment
and a few thousand francs’ damages!--Mockery!! My instinct of honour
rejected such an alternative. An honourable man revenges himself of an
outrage by meeting his offender bare-breasted, and with equal weapons.
You think as I do, sir?’
“‘Your seconds, your time, your arms?’ cried Vassigny, all his courage
revived by this appeal to the point of honour.
“‘Patience, sir--patience. The time will come when we shall meet face to
face; but the hour of that mortal combat has not yet tolled.’
“‘I wait your orders; from this day forward I am ready.’
“‘I expected no less, sir, from your courage.’
“There was a pause, and then Marsanne continued.
“‘Whatever be the issue of our duel,’ he said, ‘you have poisoned my
life, heaped misery and bitterness upon the rest of my days. I believe
you capable of appreciating what I am about to demand. Yesterday, sir,
when I became aware of my dishonour, my first thought was a thought of
blood. Then I examined my own conscience--a cruel and painful
examination, for I was compelled to own that if Madame de Marsanne had
betrayed me she was not alone to blame. I searched the innermost
recesses of my heart, and I felt that this woman, abandoned by her
husband, had at least the excuses of unhappiness and neglect. I thought
of my poor child, whose mother’s name I should tarnish, and my thirst of
vengeance yielded to these all-powerful considerations. Honour requires,
sir, that I should take your life, or you mine: but it demands still
more imperatively that the cause of the duel should remain unknown.’
“‘A pretext is easily found: a quarrel at the theatre or club will
suffice.’
“‘What, sir’ replied Marsanne, ‘you, who know the world and its greedy
curiosity as well as I do, can you think that it will be satisfied with
a frivolous pretext, and will not strive, by cruel investigation, to
penetrate our secret? No, sir! to-day a duel would leave too large a
field for conjecture; our meeting must be prepared long before-hand. In
this night of agony I have calculated every thing the interests of my
vengeance, the interests of my honour, the interests of a woman whom I
still love.’
“The Count’s voice quivered as he pronounced these last words, and a
scalding tear coursed down his cheek.
“‘Your wishes are orders for me,’ said Vassigny.
“‘You shall give me your word of honour,’ continued the Count, ‘that
from this moment you will see Madame de Marsanne no more. Then, resuming
a gay life, you shall make a parade of some intrigue, either in society
or behind the scenes of a theatre, which, by misleading suspicion, will
enable us to have the meeting you must desire as much as myself.’
“Vassigny reflected for a few moments, and replied in a firm tone-
“‘Monsieur le Comte,’ he said, ‘I have long known you for one of those
men with whom honour stands before every thing; and from the very first
day I made, as now, the sacrifice of my life. But I am not bound to do
more; and if I subscribe to your demand, I have a right also to
stipulate a condition.’
“‘You!’ exclaimed Marsanne, with repressed fury.
“‘Yes, I!’ repeated Vassigny, with indescribable energy: ‘my honour and
my heart render it my imperious duty. Pledge me your word as a
gentleman, that for every one, even for Madame de Marsanne, the real
cause of our duel shall remain an impenetrable secret, and I at once
adhere to all your conditions.’
“‘You love her, then, very dearly,’ ... said the Count, with a bitter
laugh.
“‘Enough to sacrifice my life, my honour, even my love, to her repose.’
“After a few instants of silence, the Count again spoke in a grave
voice:
“‘You do your duty as a man of honour, sir, as I have done mine; and I
now pledge you my word that for every one, even for Madame de Marsanne,
the cause of our duel shall remain a profound secret.’
“‘On your day, at your hour, I am ready,’ said Vassigny.
“‘I thank you, sir; depend on my word, as I depend on yours.’ And with a
dignified wave of the hand to his adversary, Marsanne left the room.”
This violent scene had exhausted Vassigny’s fortitude; the Count gone,
he, sank into an arm-chair, covered his face with-his hands, and wept
like a child.
Some weeks have elapsed and the characters of the tale are assembled at
a theatre: Marsanne, his wife, and Kersent in a box--Movillez and
D’Havrecourt in stalls--Mademoiselle Francine on the stage. Vassigny, in
one of the proscenium boxes, has no eyes or ears but for the actress. He
has kept his word to Marsanne, and Paris rings with the scandal of his
attachment to Francine. She is the _Chien d’Alcibiade_. Strictly
honourable in the observance of his promise, he has neither seen nor
written to Madame de Marsanne since the day of his terrible interview
with her husband. Such self-denial has not been exercised with impunity.
In a few weeks, ten years have passed over the head of the unhappy
Gaston de Vassigny. His brow is furrowed, his temper soured, and his
amazed friends attribute these sad changes to his insane passion for the
worthless Francine. He plays high; it is to supply the wants of his
extravagant mistress. At the club, Marsanne is his usual antagonist, and
always wins. Vassigny loses his temper with his money, and says harsh
things to the Count, who bears them with exemplary patience, for the
hour of his revenge is not yet come. But if Vassigny is supremely
wretched, Amélie de Marsanne is not less so. She too, within a few
weeks, has changed so as to be scarcely recognisable; and on her wan and
pallid countenance the outward and visible signs of a breaking heart are
unmistakably stamped. In vain has she striven to learn the reason of
Vassigny’s sudden and unaccountable estrangement. He steadily avoids
her. She sees him in public, ostentatiously displaying his disgraceful
_liaison_ with a low actress, constant in his attendance at her
performances, galloping on the Champs Elysées beside the carriage he has
given her. She catches the innuendos of his acquaintance, sneering at or
pitying his infatuation. At the theatre, on the night in question, she
is agonised by the malicious jests of little Movillez, who pitilessly
ridicules Vassigny’s absurd and ignoble passion. Early the next morning
Vassigny receives one of Kersent’s cards, with a request written upon it
for an immediate visit. Supposing his friend to have had a quarrel, and
to need his services, he hurries to his house. Kersent, who is soundly
sleeping, abuses his visitor for arousing him, declares he has sent no
message, and disavows the handwriting on the card. Just then the servant
enters and announces the arrival of a veiled lady, who waits in an
adjoining apartment to speak to the Viscount de Vassigny.
With pensive and care-laden brow, Gaston left his friend’s room, and
entered that in which the lady waited. But on the threshold he paused,
and a deep flush overspread his countenance. He beheld Madame de
Marsanne.
It was indeed the Countess, who, in contempt of propriety, and
half-crazed with suffering, had resolved to hear her sentence from
Vassigny’s own lips. In vain she had written to him--her letters
remained unanswered; in vain she had neglected no means of seeing
him--her endeavours had invariably been fruitless. Her heart torn by
such ingratitude, and by the scandalous passion Vassigny paraded for
Mademoiselle Francine, she had not hesitated to seek an interview in the
house of her husband’s cousin. In the sad conversation that ensued, the
most touching appeal that tenderness and suffering could inspire was
addressed by the Countess de Marsanne to Vassigny. But he was able to
impose silence on the passion that devoured him.
Divided between his love and the respect due to his plighted word, the
two most violent sentiments that find place in man’s bosom, Gaston’s
heart bled cruelly; but he triumphed over himself. Words full of the
coldest reason issued from his lips; he had sufficient strength to break
for ever the tie that bound him to the Countess. These cruel words did
not fail of their effect: Madame de Marsanne believed that she had
honoured with her tenderness one unable to appreciate its value, and
incapable of a generous sacrifice.
“‘M. de Vassigny’ she said, ‘you are a heartless man!’”
Such was the phrase that terminated this melancholy interview. The heart
of Madame de Marsanne was broken, but a guilty love had for ever left
it.
Some moments after the close of this scene, Vassigny re-entered
Kersent’s chamber; but his face was livid, and he could scarcely drag
himself along. Without a word, he sank upon a chair and remained plunged
in the most gloomy despair. Kersent’s countenance, usually so joyous,
had assumed an expression of anguish. He had examined the writing on the
card, and he could not conceal from himself that he knew the hand. The
scene at the theatre the previous evening came back to his memory: he
remembered the strange melancholy of his cousin, her confusion when she
returned him the card-ease she had asked to look at; and from all these
things combined, he concluded that a fatal secret weighed upon two
beings whom he cherished with equal tenderness. On beholding Vassigny’s
profound consternation, the sportsman heaved a sigh of deep distress.
“‘My dear friend,’ he said to Gaston, ‘a misfortune threatens you: open
your heart to me, I conjure you, in the name of our old friendship.’
“Vassigny made no reply.
“‘Hear me, Gaston; you know me well enough to be certain that no idle
curiosity impels me. Perhaps I can serve you. If I may believe the sad
presentiment that fills my heart, you suffer not alone, and the poor
woman that suffers with you has a right to all my sympathy. For she who
has just left this house, is----’
“Vassigny sprang to his feet, and placed his hand over his friend’s
mouth. ‘No, no!’ he exclaimed, ‘the fatal secret shall die with me.’
Then, without another word, he sat down at a table, and with a trembling
hand traced the following lines:
“‘Monsieur le Comte, there are tortures which human strength cannot
endure. For mercy’s sake, let us terminate this sad affair as soon as
may be, or I will not answer for keeping my promise. I shall pass the
night at the club.’
“This letter was addressed: ‘_Monsieur le Comte de Marsanne_.’”
At the club, the husband and the lover meet and play high. Vassigny
loses, as usual; affects anger, shuffles the cards offensively, and
hints suspicions of foul play. A challenge is the natural result. Late
upon the following night, we find Kersent pacing the Boulevard in
despondent mood, accompanied by D’Havrecourt, who has acted as one of
Marsanne’s seconds in the inevitable duel. They discuss the melancholy
event of Vassigny’s death, which has occurred that evening, a few hours
after his adversary’s ball had pierced his breast. Vassigny had fired
in the air.
“‘The more I reflect on it,’ said D’Havrecourt, ‘the more convinced I am
that the unworthy affection of which Vassigny made a parade, was only a
feigned sentiment, a mock passion thrown as a blind to the indiscreet
curiosity of the world, to mask a devoted, although, perhaps, a guilty
love. To you, who loved him as a brother, and to you alone, I may
divulge an episode of this fatal drama. This it is. Vassigny was still
stretched upon the grass; the surgeon, after vainly endeavouring to
extract the bullet, put up his instruments, with a countenance that left
me no hope. Tinguy had led away Marsanne; Navailles and Lord Howley had
gone off in all haste, one to have every thing prepared at Vassigny’s
house, the other to summon the first physicians. I was alone with the
wounded man. His senses returned; he opened his eyes, and I saw by the
expression of his agonised features that he wished to speak to me. I
knelt beside him. He raised his left hand, and in a feeble voice asked
me to unfasten his shirt-sleeve. I obeyed. His wrist was encircled by a
small bracelet of hair, so tightly fastened to the arm, that, to get it
off, I had to cut the tress. ‘D’Havrecourt,’ said he faintly, ‘that
bracelet was only to quit me with life; I confide it to your honour;
swear to annihilate it the instant you get home.’ I made the required
vow, and from that moment he spoke not a word. On reaching home, my
first care was to fulfil my promise, by burning the bracelet. It was
composed of a tress of fair hair, and the hair of that Francine is
black. And it was secured by a gold plate, upon which were engraved an A
and a G intertwined, with the words ‘14 October 1840.’’
“‘Oh! say no more, my dear friend,’ cried Kersent, interrupting the
Major, ‘Alas! I have too much reason to believe that there are now upon
this earth two beings infinitely more to be pitied than Vassigny. He, at
least, has found in death oblivion of his sorrows; but they survive for
misery and tears.’”
None, save Kersent and D’Havrecourt, suspect the true cause of the duel;
they are men of honour, and the secret is safe with them. For once, the
inquisitive and scandal-loving Parisian world has been put upon a wrong
scent. The Count’s precautions and Vassigny’s sufferings have not been
thrown away. The Countess’s reputation is saved--the honour of the De
Marsannes remains unblemished. It is not without success that the
ignoble Francine has been made unwittingly to play the part of the Dog
of Alcibiades.
An epilogue, in the shape of a letter from Kersent, dated a year later,
from the bivouac of Bab-el-Oued, closes this tragical and well-told
tale. It informs D’Havrecourt and the reader of the death of the Count
de Marsanne and his erring and unhappy wife. The latter had died some
months previously, of a malady brought on by grief. The Count met his
fate by a Bedouin bullet in the deserts of Algeria. Kersent, whom
affection and compassion had prompted to accompany his cousin in his
last campaign, found upon the breast of the dead officer a locket
enclosing a fragment of paper, the legacy of Madame de Marsanne to her
husband. It contained the avowal of a fault and a prayer for pardon.
SIR ROBERT PEEL AND THE CURRENCY.
“De Mortuis nil nisi bonum” is, when applied to individuals, a generous,
if not a just rule for our ordinary guidance. But to whatever extent it
may be carried in judging of men and their motives, we apprehend that it
would be the height of Quixotism to admit a defunct cabinet or an
ejected minister to the benefit of any such act of indemnity. The evils
which statesmen may commit, either through mistaken policy or
egotistical arrogance of opinion, are too serious in their results to be
easily or readily forgotten: and no lapse of time whatever can screen
from censure those men who have wilfully tampered with the well-being
and prosperity of the nation.
It will, we think, be admitted on all hands, that the present ministry,
however well disposed, are most wofully infirm of purpose. We make every
allowance for the situation in which they found themselves when called
to office. However sanguine may have been the dreams of the Whig
partisan, he could not, some eighteen months ago, have entertained the
slightest idea of that extraordinary combination of chances which led to
his return to office; neither do we believe that the leaders of that
party ever expected to obtain even a temporary ascendency during the
existence of the present parliament. When Lord John Russell and his
confederates threw down the gauntlet of Free Trade, they could not have
calculated upon the possibility of its being picked up and appropriated
by their old antagonist of Tamworth. Well as they may have known, from
former experience, the nature of that “tricksy spirit,” they never could
have been prepared for that crowning denouement to a drama of political
apostasy; and we are certain that no section of her Majesty’s subjects
were more amazed than the Whigs when they found themselves again in
possession of their coveted quarters in Downing Street. Without plan,
and without preparation, we freely admit that they were entitled to a
large share of public indulgence. In ordinary times, their
administration might even have been productive of good. Schooled by
adversity, and instructed by previous failure, they this time put
forward in the van no opinions of a revolutionary tendency. They
promised to apply themselves in the first instance to the mental and
physical amelioration of the people--they offered to become the patrons
of educational seminaries, directors of public baths, and inspectors of
extended sewerage; and no one could gainsay in these respects the purity
of their projected measures. But, unfortunately for them, the
necessities of the time required more than sanatory legislation. The
prodigious increase of national wealth which was prophesied as the
immediate result of the change in our commercial policy and the repeal
of agricultural protection, did not arise, like Aladdin’s palace, in one
night from the liberated ground. The various and complex questions of
Irish policy became all at once merged and confounded in the cry of
common famine. The staple food of an unenterprising and improvident
people had failed; and the Celts of the western islands, desisting from
their absurd denunciation of the Saxon, were fain to supplicate Great
Britain, herself by no means exempt from the calamity, for the means of
absolute existence.
We do not intend to criticise in detail the means which were adopted by
government for the relief of the suffering districts. We believe that
they were actuated throughout by a liberal and a kindly spirit; and upon
such an occasion as this, it was truly difficult to steer between
parsimony on the one side, and reckless extravagance on the other. At
the same time it is very evident that they were utterly unprepared for
the crisis. They neither adopted an intelligible principle, nor laid
down an extensive plan for their guidance. They vacillated every week
between one method of relief and another. At one time they were for the
promotion of useless works, which could tend to no profitable result,
but which were a mere excuse for opening the public coffers to the
relief of the starving Irish; at another, they rejected the proposal of
Lord George Bentinck for extended railway employment--a scheme which,
however objectionable from its magnitude, at least held out a feasible
prospect of ultimate reimbursement of the loan. It is right to observe
that in this refusal they were strengthened by the co-operation of Sir
Robert Peel, their former opponent, but now their confidential adviser;
and that the only ministerial measure of which the late autocrat has
been pleased to disapprove, was a subsequent veering towards the
principle recommended by Lord George, and the concession of a restricted
loan towards the promotion of the Irish railways. But, as we have said
before, the question of Irish relief was attended with much difficulty.
The most experienced and sagacious statesman of the world might have
gone astray in providing for a calamity so extended and so new; and,
upon the whole, we are not inclined to find much fault with the Whigs in
this respect, beyond what is implied by our decided conviction of their
weakness, or rather want of purpose.
But, unfortunately for us all--most unfortunately, we fear, for the
great bulk of the community--there are other questions not only
impending but absolutely pressing upon us at this moment, of even
greater vital importance than either Irish famine or British scarcity.
It may be that, through the mercy of Divine Providence, these scourges
maybe speedily removed. The soil may again be restored to its former
fertility; and if such should prove to be the case, we trust that this
calamitous lesson against idleness and improvidence will not be
forgotten in those quarters where the visitation has been most severely
felt. We trust that, in Ireland especially, and in some parts of our own
country, both landlord and tenant will be roused to a more active sense
of their respective liabilities and duties; and that, notwithstanding
the tendencies which are too likely to follow from our late pernicious
course of legislation, they will become alive to the conviction that no
nation whatever can hope to maintain its independence if it neglects the
paramount duty of cultivating and rearing within itself that supply of
food upon which its inhabitants must depend for their support. It is not
much more than a year ago, since we pointed out the miserable
consequences which, in the event of a war or a famine, must ensue from a
decrease of the cultivation of the soil, such as was not only
contemplated, but openly recommended by some leading partisans of the
League. Since then, we have had an opportunity of testing the strength
of our actual position under one of those terrible emergencies. Scarcity
has come, though not famine in its most gaunt and hideous shape; and not
only are our own supplies deficient, but the greatest difficulty has
been found in procuring a substitute from elsewhere. Had this occurred
in the time of war, not in the season of unbroken peace, when the
highway of the ocean is free, it is hardly within the power of man to
exaggerate the horror of the consequences.
But, though the heavens may again smile upon us, there are evils of
man’s creation which may not be so speedily removed, unless the nation
can be brought to a clear sense of the predicament in which they have
been placed by the insensate obstinacy and insatiable conceit of one
minister, who, though ejected from office, is yet powerful in the
councils of the empire. We cannot explain, because we do not understand,
the nature of that mysterious and undefinable power which Sir Robert
Peel seems to exercise over the proceedings of the present cabinet. We
do not know the secret composition of the philtre, or love-potion, which
he appears to have given to the Whigs; but we have seen quite enough in
the recent discussions in parliament with regard to the monetary
pressure which is now in the act of crushing and grinding to dust many
thousands of the commercial and industrious classes, to be aware that
the Russell ministry are entirely at one with Sir Robert in the
maintenance of his favourite crotchet, and that they are prepared to
abide by his delusion with regard to the currency, be the consequences
to the country what they may.
This question of the currency is at once so vast, and so vital to the
interests of every man who has any stake at all in the community--it
presents itself at this moment in so alarming, and yet so palpable a
shape--that we would be inexcusable were we to remain silent at a crisis
when the evils of circumscribed credit and bank restriction are driving
the honest trader into the Gazette. Long before the late premier had
absolved us, by his unprincipled tergiversation, from all ties of party
and support, we sedulously and earnestly protested against his perpetual
meddling and tampering with the circulation of the country. In
particular we were amongst the first to oppose his wanton, because
uncalled for interference with the Scottish Banking System, under the
operation of which the country had advanced, without risk or injury, at
a ratio which probably never was equalled, and which certainly never was
exceeded. We then warned, not only the bankers, but our national
representatives, and the public, that if they permitted one single wedge
to be driven into the fabric, the stability of the whole was endangered;
and we showed that the retention of our one-pound note circulation was,
though an important item of profit to the bankers, and of convenience to
the public, of little consequence compared with the results which must
ensue, if the circulation of the banks was arbitrarily limited, and all
extension of credit made to depend upon the possession, or rather the
purchase, of a large sum of useless and unprofitable bullion, which, so
far from increasing the wealth of the country, must inevitably render it
powerless in the event of a commercial panic. We believed then, and we
believe now, that history does not afford a parallel instance of so
reckless and shameful a disregard of public feeling and opinion on the
part of any statesman; and the confidence and perseverance with which
Sir Robert Peel proceeded to thrust his measure down the throats of the
Scottish bankers, was, in our opinion, little less than a deliberate
insult to the country,--because we never can forget this great and
pregnant fact, that no grounds for tangible accusation could be drawn,
or were attempted to be established, from the practical working of the
system. That system was created by a somewhat neglected people for their
own convenience, and without any legislative interference at all. It had
supplied all the necessities of the country, and had been found perfect
in its operation during periods of more than common exigency and
distress. It had stood the test of experience successfully at times when
the monetary system of England had been proved insufficient for the
pressure. It possessed the full confidence of the nation; and yet--we
can hardly write the sentence without a blush--it was surrendered after
a faint opposition, merely because Sir Robert Peel considered himself an
accomplished currency doctor, and was desirous to try the effects of his
_aurum potabile_ upon a sound as well as a sickly subject.
The one-pound notes, however, were spared, and the bankers in some
degree reconciled to the change by the promise of a future monopoly. Had
not that bait been thrown out to them, we can hardly believe it possible
that so unnecessary and unpopular a measure could have been carried at
all, but, the wedge being once inserted, it has since been driven home
to the quick. We appeal now with confidence to the merchants and
manufacturers of Glasgow, Paisley, and Greenock--to the landed gentry,
who are suffering under the tightening of the screw--to the enterprising
tenant, who, under a long lease, is seeking to improve his land--to the
trader, dealer, and shopkeeper of every kind throughout
Scotland--whether they ever experienced such a monetary pressure as the
present. And we ask them further to consider for themselves, and that
very seriously indeed--for an evil too long submitted to may grow beyond
the reach of a remedy--what is the real cause of this distress, and
unparalleled scarcity of money? How is it that, with property of the
most undeniable value on their hands, which they are ready to tender in
security, they cannot by any means whatever obtain their accustomed
credit? And then we ask them to compare the present state of matters
with the past, and point out, if they can, any one period or crisis,
before Sir Robert Peel was pleased of his own accord to substitute his
banking system for that established by the progressive intelligence of
the nation, when money could not be obtained and credit given, at fair
but not exorbitant rates, for good and sufficient security?
We crave the pardon of our English readers if, in the first instance, we
place this point more exclusively in a national view. It is quite true,
and we are fully alive to the fact, that, thanks to the crotchet of Sir
Robert Peel, England and Scotland are now placed in exactly the same
monetary difficulties, and we are not without hope that, on that
account, our united efforts to get rid of the nightmare which is
stifling us both, may prove more effectual than if either country were
struggling singly for liberation. But it must not be forgotten that with
us the experiment has been recently made. We are still most vividly
alive to the advantages of a system which we ourselves founded, upon
principles of mutual support among all classes of the community--under
which we have risen and thriven--and which has not been sacrificed on
account of any alleged fault or deficiency in its working, or from any
intelligible motives of public policy, but simply to gratify the whim
and feed the vanity of a minister who considers himself wiser than a
nation, and who never can be happy without change. A monetary crisis and
a panic are new things to us; for we have hitherto been accustomed to
associate public distress with low wages, low prices, and a want of
demand for products. But we find ourselves now for the first time in
this position, that with higher wages than are the average, more demand
for labour than can well be supplied, and more orders on the hands of
our manufacturers than can well be executed, we are yet brought to an
absolute stand-still for want of money. We go to our bankers with
security which is both unquestioned and unquestionable, and we proffer
it in security for that which, according to our old ideas, we think that
we are absolutely entitled to have on such terms--for money, the
life-blood of a commercial community; and we are told that it cannot be
given to us! And when we inquire the reasons for such refusal, we are
told that the banks cannot afford to increase their circulation; since,
under the new system, they are compelled to stock their own coffers with
gold for every single note which they issue beyond a given point--and
gold to be had must be paid for.
Had we a Pactolus among ourselves, this state of things might possibly
be endurable; but, unfortunately, we are not rich in that kind of
bullion, and our Mint--somewhat needlessly secured by the Treaty of
Union--has since very coolly been abolished. But we have iron and other
sorts of produce in abundance, and land tolerably valuable, and stocks
of various kinds, upon all or any of which we were wont, in former
times, to raise money without any difficulty, and so to make our capital
available in the prosecution of our different works. These are now
rendered absolutely and practically useless. We cannot raise money upon
them, because the bankers cannot afford to buy an exorbitant amount of
golden counters to remain in their cellars profitless and unseen; and
thus trade is brought to a stand-still, public enterprise is checked,
and the market is disappearing from our grasp.
In short, the present system under which the whole of us are groaning,
and which, if not speedily abandoned, must land us in irretrievable
difficulties, is neither more nor less than a most culpable interference
with credit, by restricting the ordinary circulation of the country to a
point far below that which is absolutely necessary for its exigencies,
and by making any further issue of paper dependent upon the purchase and
the hoarding of gold.
It may sound paradoxical when we say that we are almost glad when a
crisis like the present has arisen, because we are convinced that
nothing short of actual and painful experience will open the eyes of the
community to the miserable fallacies upon which the views of their
former and their present rulers are founded. Of all questions which can
be agitated we are quite aware that that of the currency is the least
palatable to the general reader, and the one which he most gladly
escapes from in a kind of mazed bewilderment, and generally with a
confession that its intricacies are beyond his comprehension. It is now
full time that this state of general apathy should be ended. If we hope
to preserve much longer our course of national prosperity, we must face
the question manfully, and not shrink even from the array of figures
which quacks in currency invariably adduce for the purpose of mystifying
their audience; just as their medical brethren contrive to render
themselves unintelligible by the use of a peculiar jargon. There is,
after all, no great mystery in the matter, if men would take the trouble
of reflecting for themselves. The laws which ought to regulate the
currency of a country should have reference to the real property of that
country as its basis, and not an artificial substitute like gold, which,
in addition to its scarcity and its liability to fluctuation, is
incomparably the dearest circulating medium which has ever yet been
adopted. In the words of the authors of the Gemini Letters--a
publication, by the way, which is well worthy the attention of every man
who seeks to make himself master of the details of the currency
question--“we must not expect to be relieved from the distress, and
difficulties, and dangers which overshadow the land, so long as we are
determined that the value of the produce of our lands, mines, and
manufactures, and the amount of the wages of labour, shall be dependant
upon the possession of a few millions more or less of gold coin. Will
some stickler for a high metallic standard tell us what proportion the
value of the whole of the gold generally to be had in the United Kingdom
at one time, bears to the value of all the other property of the
country? If this question were satisfactorily answered, it is probable
that we should not much longer be
“Resolved,
Like sugar-loaf turn’d upside down,
To stand upon the smaller end,”
but rather be disposed to treat this particular metal in the way that we
treat all other marketable commodities--namely, suffer it to find its
proper level.”
It is edifying to remark the different interpretations which are given,
by different supporters of the bullion representative system, of the
present acknowledged distress and unparalleled tightness in the money
markets of Great Britain. Sir Robert Peel--the apostle of the system,
upon whose shoulders, we maintain, the primary burden of this enormous
responsibility must rest--cannot but admit the fact of the gloomy
deficiency; but he falls back upon the ultimate causes. These are,
according to his view, over-speculation in railways, joined with a
scarcity of food and an increase in the price of cotton. Granting all
this to be true, what has that to do with the great question at issue?
We are perfectly ready to admit that at the present moment there is an
immense demand for money, and that the demand may be owing, in a great
measure, to these and similar causes. We know perfectly well that if
there exists a drain upon this country for gold, in order to purchase
from abroad the supply of food which is deficient in consequence of the
scarcity at home, the currency must necessarily be contracted, so long
as a five-pound note of the Bank of England, or of any other bank, is
held to be, in the eye of the law, not the representative of so much
real property--be it land, or stock, or iron--but the eidolon or shadow
of five golden coins of a certain weight and fineness, which cannot
escape from the empire without annihilating the existence of the
subsidiary paper. What we complain of in effect is this, that the whole
enormous property of the three kingdoms should be represented merely by
the insignificant and insufficient issue of thirty-two millions in
bank-notes, and that the whole remainder of the currency is entirely
metallic. For although there may certainly at times be a larger amount
of paper in circulation, that paper, beyond the thirty-two millions,
must be represented by bullion in the bank, and if the latter be
withdrawn, the representative issue must be recalled. So that, by a
large drain of gold, we may be reduced, and are at this moment becoming
so, to so contracted a circulation, that trade must necessarily stand
still for the sheer want of a common representative of property.
Why, and on what principles, the amount of our paper circulation was
fixed at so low a point, we are utterly unable to conceive, unless it
was for the purpose of compelling a large portion of our trading
capital to remain fruitless and withdrawn from use in the form of
unprofitable gold. Thirty-two millions, even in ordinary times, is not
above one-half of what is required for the needful circulation of the
country. In 1810 the currency of the paper for the three kingdoms was
not less than sixty millions; and during the thirty-seven years which
have elapsed since that time, not only has our population increased at
an enormous ratio, but our trade and enterprise augmented in a more than
corresponding degree. The tendency, however, of our improved system of
banking has been to reduce the circulation within the lowest possible
limit; but that limit was necessarily variable, and adjusted itself to
meet the occurring contingencies of the country. Now it is fixed by the
legislature at a point so low, that we are absolutely dependent upon the
amount of gold which we can retain in the country, for the means of
commercial interchange. We are obliged at present, it seems, to
transport a large portion of our gold to America for the purchase of
food. For every sovereign which leaves our shores a note is taken out of
circulation, and no means whatever are permitted to individuals or to
banking companies to supply the deficiency. In ordinary times, it might
be expected that the gold would again find its way to Britain; at
present, however, it is absorbed and scattered for the purpose of
enabling America to prosecute her aggressive war against Mexico. And of
what use, we ask, to the nation at large, are some ten or twelve
millions converted into specie and stored up in the vaults beneath the
Bank of England? Sir Robert Peel tells us, with a smile of peculiar
complacency, that the hoarding up of so much bullion is a safeguard
against a panic, because it renders any run upon the banks for gold a
matter of absolute impossibility. With only thirty-two millions of paper
extant for the common circulation of the nation, we shrewdly suspect
that any apprehensions of a run upon the banks are as visionary as the
dreams of El Dorado. No one knows better than Sir Robert Peel that the
paper currency of a country must be sorely depreciated indeed before any
such event can take place; and surely there are many means of preventing
an over-issue, without bringing us to such a pass that in every season
of scarcity or of war we must be reduced to an absolute halt--which, in
a commercial country like ours, is a word equivalent to the
impoverishment and the ruin of thousands.
We presume that Sir Robert Peel, when he carried through the Banking
Restriction Act, intended that measure to be a permanent one. We cannot
suppose that he meant it merely to apply to the present situation and
necessities of the country, or that it was left to be repealed and
altered every session of parliament, to suit the state of the money
market, and the fluctuations of the national prosperity. If so, we think
it must at once become apparent to every reasonable man, that a gross
and palpable absurdity was involved in the very principle of the
measure. For to limit the supply of the ordinary circulation in a
commercial country like ours, liable as it is to expansion and
contraction, to periods of peculiar activity and of occasional serious
depression, is quite as preposterous an idea as it would be to declare
by statute what amount of food or what extent of water should in all
time coming be used by the inhabitants of the British Islands. To
interfere with the operation of credit, which is the object of Sir
Robert Peel, is practically the greatest blow that can be given to the
enterprise and the advancement of the country; for it just amounts to
this, that not having a sufficiency of straw wherewith to manufacture
our bricks, we are even denied the privilege of going out into the
fields to collect the subsidiary stubble. The Pharaoh of Tamworth is a
heavier taskmaster than the Egyptian. He demands our daily rate of
taxes, but will neither furnish us with the material, nor permit us to
gather it for ourselves.
If permanent, it is incumbent upon the supporters of the Banking
Restriction Act, who are the very parties at present refusing to relax
one iota of our bondage, to show that their measure is well adapted for
every political contingency. That, we apprehend, would require greater
hardihood, and certainly more ingenuity, than they have yet enlisted on
their side. There are many things besides a scarcity or a famine which
may occasion a drain of gold. That metal has a peculiar facility of
finding its own level; it is liable to sudden demands, and its price is
variable accordingly. Were this country to be again engaged in a
European contest like the last, we should have a recurrence of the drain
of 1814, when gold was at the rate of £5, 8s. per ounce, or upwards of
one pound ten shillings and two-pence above its present value. No
political foresight, no legislative enactment whatever, can guard us
against such a state of things; and the consequence would be an entire
disappearance of bullion. According to our present system, the loss of
bullion would necessarily produce such a contraction as would lay the
credit of the country prostrate. All our extra circulation, founded on
the metallic basis, would immediately be called in; taxes could no
longer be paid, and the result would be a revolution or the sponge. Are
the capitalists of the kingdom, who, we were told some time ago, were
the chief supporters of Sir Robert Peel, anxious that the experiment
should be made? We can assure them that if it is intended to maintain
the circulation of the country permanently upon its present basis, they
stand in imminent danger, not only of occasional panics, but of that
repudiation which in America was the consequence of a similar tampering
with the banks, and the like metallic delusion. At best they must make
up their minds for the recurrence of many seasons as hard and as cruel
as the present; and it will be well if many of their class are not
involved in the ruin which is impending at this moment over the heads of
the minor traders.
But, say some of the bullionists, this measure is not intended to be
permanent. It is, like all other legislative enactments, subject to
modification; and we are prepared, when occasion presses, to alter it
accordingly. Why, then, in the name of common sense--nay, in that of
common humanity--has not the alteration been made? Is it intended that
the public shall sink beneath the pressure of this law before the
smallest portion of its burden shall be removed? Is it wise to delay all
relief until the Gazette is full, and to keep credit suspended at the
very moment when it is most urgently and clamantly required? And what
kind of law, we ask, is that which in prosperous times--that is,
whenever gold is abundant--confessedly puts no check whatever upon
speculation, but which, at the least turn of the tide, is an absolute
engine of destruction? Look at it in any view, and we maintain that a
more miserable instance of legislation upon false and contracted
principles was never yet invented by the brain of a political economist.
The host of pamphlets which has recently issued from the press, upon
this momentous and interesting topic, sufficiently demonstrates the
pressing nature of the crisis. Whatever difference of opinion may be
found amongst so many writers, with regard to the intermediate basis and
proper representative of property, they are almost to a man combined in
denouncing the impolicy of the late restrictions. Lord Ashburton, the
advocate and apologist of the Bank of England, is at one with Mr
Enderby, the able opponent of the gold standard, as to this particular
point. They are all agreed that the system which professes to rectify an
inevitable drain of gold, by crippling the trade of the country, and
forcing down the value of its property, is nothing short of absolute
infatuation, and that, considered by itself, it admits of no
intelligible defence. It would be well, therefore, if an effort were
made, in the first instance, to get rid of the odious and absurd
restrictions, or at least to substitute for the present miserable
driblet, a much larger amount of paper currency, which may be based upon
government securities. There is but one opinion prevalent throughout the
country with regard to the present insufficiency of the currency, so
long at least as the Bank is compelled by statute to deprive us of the
means of fair and legitimate accommodation. Sir Robert Peel has placed
the directors in this anomalous and invidious position, that they _must_
put on the screw whenever there is a prospect of adverse exchanges; and
the immediate effect of that measure is a stoppage of trade, and at the
same time a depression in the value of every kind of merchandise and
product. Taken singly, this is an evil of the very worst description--in
fact nothing worse could be expected from the most formidable
combination of natural and political causes. Taken in connexion with the
late tariffs, which, without securing reciprocity, have opened the home
market to the competition of the foreigner, who is less taxed and
cheaper fed than our own redundant population, each recurrence of it is
a blow to our commercial prosperity, which if often repeated would bring
us to the verge of ruin. The first measure, therefore, which ought to be
taken--and we entreat the serious attention of every man who understands
the currency question to this--is to emancipate the Directors of the
Bank of England from their present false position, by removing the
restriction of their paper issues, or at least by fixing these at a
point which will enable them to supply the ordinary wants of the
community, without reference to an accidental or inevitable drain of
bullion, so that the internal trade and production may never be checked
so long as there is a remunerative demand. A similar regulation must of
course be made with regard to the country bankers; and were this done,
we have very little fear indeed that any crisis at all equal to the
present one could arise. But we must not be left in absolute dependence
for our circulation upon the state of the harvest, or cripple labour at
the very season when employment is most urgently required.
We do not say that the repeal of the Act of 1844, or the increase of the
paper issues to a larger fixed point, can set the question of the
currency at rest. No thinking man who has devoted his time and energies
to the study of our monetary history, would be bold enough to make so
rash and confident an assertion: on the contrary, we think that the time
is not far distant, when the leading theories of the bullionists must be
thoroughly probed, and the consideration of the expediency of a fixed
gold standard most seriously and deliberately resumed. The experience of
some thirty years of peace has furnished data to us which were not known
to the older political economists, and we are now far better enabled to
explain the phenomena of commercial fluctuation. But it would be
extremely unwise at the present moment, when a palpable and tangible
evil is before us, to attempt too wide a reformation, and so to peril
the chance of a present amendment, on the necessity of which we are all
most thoroughly agreed.
From some quarters we have heard an expression of extreme surprise that
the late Premier, who cannot but be awake to the mischief which he has
so wantonly caused, should have been so obstinate and inflexible in his
adherence to the restrictive system. Very little consideration indeed is
requisite to discover the reason. Upon this question of the currency the
whole character and repute of Sir Robert Peel as a financial minister
are staked, and he dare not abandon his measure of 1844, without tacitly
admitting that he has committed a most serious and unpardonable blunder.
Accident has intervened to postpone any actual test of the efficiency of
his other measures. We do not yet know what effect the alteration of the
corn laws may produce upon the welfare of the nation in an ordinary
year, or whether any of the blessings so abundantly promised may be
realized to the poor without a more than corresponding depression. The
tariffs abroad continue still hostile and unrelaxed, and although the
smaller manufacturer, artisan, and workman, are already beginning to
feel the baneful effects of foreign competition in the home market,
their cry is not yet loud enough to excite a large share of the popular
commiseration. Two great events stand prominently forward in the aspect
of the present year--the scarcity and high price of food, and the want
of commercial accommodation among ourselves.
The first is the act of Providence. No human foresight, no political
skill, could have prevented it, and the scourge has mercifully fallen at
a time when the demand for labour has materially lessened its severity
in Great Britain. But that same scarcity, by leading to an exportation
of the precious metal, has been undoubtedly the means of testing the
soundness of our monetary system. As the prosperity of these islands,
and our wonderful ascendency in the great markets of the world, depend
upon the state of our trade and our manufactures at home, it was
obviously the duty of a minister, who, more than any other, professed
his intimacy with commercial principles, to take care that the evil of a
scarcity should not at the same time be combined with the still greater
one of a monetary crisis. If gold must be paid away in order to purchase
the necessary supply of food for our population--if in addition to our
own wants we are compelled to ward off starvation from the thoughtless
and unenterprising Irish--we were doubly bound to take care that our
great staple resources, our trade and our manufactures, should not
suffer from any cause over which we had the evident control. And yet,
how do we stand at the present moment? No sooner does the drain of
bullion begin, than the Directors of the Bank of England, placed by this
odious and uncalled-for measure of Peel’s in sudden jeopardy of their
charter, begin to put on the screw. The country bankers, who must take
their cue from, because they are rendered entirely subordinate to the
great establishment in London, are compelled to follow the example.
First of all the rates of discount are raised, and then credit is
peremptorily refused. This, be it remarked, is at a time when the
solvency of individuals is unsuspected,--were it otherwise, the crash
must have been tremendous ere now. The enormous bulk of the _real_
circulation of the country, which is represented by bills of exchange,
and which never can be estimated with any thing like an approximation to
its amount, is thus instantaneously checked. The Banks cannot
discount--the bills become useless, and the property on which they are
based, can not now command its representative. Fifty thousand pounds of
silver bullion could not command five thousand pounds of money in the
public market of London. The manufacturer saw his credit stopped, his
bills unnegociable, but he had still to pay the weekly rate of wages, or
suspend labour, as indeed in many instances has been done. And all this,
because Sir Robert Peel has forced the fountain of our currency to run
dry. And then comes a depreciation of the value of property, the extent
of which would be almost incredible, were not every one of us, except
the Capitalist and the Annuitant, aware of it by melancholy experience.
According to Lord Ashburton--“It would not be easy to estimate this
depreciation, extending over all merchandise, stocks, railway shares,
&c.; it would probably not be overstated at FROM TEN TO TWENTY PER
CENT.; but what is worse, it has paralysed this property in the hands of
the possessors, rendered it unavailable towards meeting their
engagements, and thus produced in many cases pecuniary sacrifices much
beyond the mere depreciation of the property itself. It has further
occasioned the suspension of the execution of orders from our customers
in every quarter, thus distressing manufacturers, and impeding those
very operations which would have corrected the tendency to an
unfavourable balance of trade, and given safety to the circulation of
the Bank.”
Now whatever we may think of the extreme candour of the Right Honourable
Baronet, it is perhaps rather too much to expect from human nature that
an individual who has been the cause of all this monstrous mischief,
should stand forward at once, and manfully plead guilty to the charge.
Sir Robert Peel has not yet played out his full hand of political cards;
and he is perfectly well aware that after such an admission, very few
persons indeed would be inclined to cut in with him for a partner. In
short, were he now to acknowledge himself in the wrong, it would be at
the sacrifice of his sole remaining qualification as a statesman--the
_prestige_ of his financial sagacity. If he loses this, faint though the
recommendation be compared with the far higher qualities of consistency
and open dealing, he is indeed a bankrupt in his fame! Need we wonder
then that he clings to his darling measure, with a tenacity absolutely
startling when we reflect on his former degrading versatility? Need we
wonder that he eagerly attempts to fasten the blame of the monetary
pressure upon the railroad speculators, the Bank Directors, or any other
body of men who can at all be brought into question? As to the Bank
Directors, we quite agree with Lord Ashburton that it is most unfair to
make them the scape-goats in this matter. Had they not been bound down
by stringent statutory fetters--had they been allowed to use the common
caution of every commercial dealer by measuring the amount of their
accommodation by the known responsibility of their customers, there
would have been no financial crisis. But Sir Robert, in his infinite
wisdom, would not suffer them to retain the prerogative of thinking and
rational beings. He made them mere machines for contracting the
circulation, and prohibited them from supporting credit: and surely they
are not blameable if they shaped their conduct according to the clear
letter and distinct direction of the law. In dealing with the railway
shareholders Sir Robert Peel cuts even a sorrier figure. He talks about
absorption of capital and over-trading, as if these things had in
reality any thing to do with an arbitrary restriction of the currency.
Now we do not require to be told that there is a certain limit at which
accommodation must stop; but we maintain that it is the function of the
banker to decide when that limit has arrived in the case of each
particular customer. If a man has embarked the whole of his available
capital in undertakings which are not yet profitable, or which do not
speedily promise to become so, it is unquestionably in the option of the
banker at his own risk to refuse or to increase his credit. But, as
matters presently stand, not only has the banker no such option, but he
cannot afford the required accommodation even to parties whose capital
and property are undoubted, for the very simple reason that the law, as
amended by Peel, deprives him of the means of doing so. If gold goes out
of the country, from whatever cause, the issues must be correspondingly
contracted. And is it expected that the whole ordinary business of the
country can be conducted with something like one half of its usual
amount of circulation? It will not, we presume, be denied by Sir Robert
Peel and his Whig financial adherents that the increase of internal
railway enterprise, and the vast additional labour which it may be said
to have created, require a larger amount of ordinary circulation than in
the year when the Bank Restriction Act was passed. And yet, not only
have no means been taken to provide for such an expansion, but when the
scarcity and drain arise, and the issues are arbitrarily contracted, our
candid economists, instead of acknowledging their own normal error, have
the coolness to attribute the pressure to the employment of labour at
home! Had it not been for that labour and the expenditure of capital
among ourselves, the situation of the working classes during the past
winter, when the prices of provisions were so high, would have been
lamentable indeed.
However, since the currency debate in the House of Commons, Sir Robert
Peel seems to have changed his ground a little. It is curious to remark
that, in all these financial discussions, the members of the present
administration appear as absolute ciphers. They hardly profess to
understand the question, but give their absolute faith to the doctrines
of Sir Robert, who, with some two or three of his remaining adherents,
is put forward to do battle, with the Protectionists and the mercantile
party. The member for Tamworth is now desirous of falling back upon his
old bullionist theories; and, with the utmost gravity, has invited a
serious discussion upon the following subject of debate, “What is a
pound?”
The object of this question is sufficiently clear. The astute
ex-minister, finding himself so vigorously assailed on all quarters, for
the absolute failure of his model banking act, and being unable to
defend it upon any intelligible principles, would fain rake up a point
upon which the opinions of his opponents differ, and so escape from the
dilemma under a cloud of contradictory theories. It is an old device,
and not a very creditable one; but we trust that, on the present
occasion, it may prove utterly unavailing. The question is not now of
the convertibility or inconvertibility of paper; for, if it were
absolutely this, there are materials enough in Sir Robert Peel’s own
banking measures to refute the notions which he professes to maintain as
a principle. His own currency is not altogether based upon gold.
_Fourteen millions of the Bank of England’s paper is unrepresented by
the precious metals_; and yet every one of these notes is an actual
engagement to pay the bearer of it in gold! Notwithstanding all the
arguments of the bullionists, the plain matter of fact is just this,
that the Bank of England, like every other institution of the country,
is substantially based upon credit, _and that it never had, at any one
time, the means of liquidating its engagements by payments in specie_.
The issue, therefore, of paper, as it cannot be made to depend entirely
upon the amount of hoarded gold, ought to have reference simply to the
absolute wants of the community--wants which are, as all experience has
shown, remarkably but inevitably variable, and which must be supplied in
order that trade, and manufactures, and agriculture may go on, and that
our internal products may adapt themselves, with out any difficulty, to
the demand.
The question as to the real nature of a pound is useless at the present
time. We are not now discussing the older banking acts, but the wretched
abortion of 1844, which has led to this unnatural crisis. It is, in
fact, a question which ought not to be mixed up with the others, because
if, as Sir Robert Peel maintains, a pound is neither more nor less than
a piece of metal of a certain weight and fineness, to which he, in
opposition to the practice and experience of the whole world beside, has
attempted to give a fixed unvarying price. He should in the first
instance be prepared to defend it as the sole basis for every kind of
representative circulation. In short, if his theory be correct, no
banker should be permitted to issue a note, unless he has within his
coffers a “pound,”--that is, a sovereign, to redeem it. Were the
bullionists consistent, such indeed would be the proper result of their
arguments, and the consequence would be, that at the present moment the
legal circulation of England would have been something under ten
millions. We shall not pause to demonstrate the absurdity of such a
position, because it carries distinctly upon its face its own triumphant
refutation. It follows therefore, and is admitted, that the basis of our
circulation is mixed--part of it, which fluctuates, being the
representative of these precious “pounds,” and the larger portion being
based on credit, or inconvertible government securities.
What is the use then of arguing about a “pound,” when our paper, if
called in, could not by any possibility realise it? We do not in the
slightest degree deprecate the discussion at a future time; on the
contrary, we most earnestly hope that the whole subject may engage the
early attention of the next Parliament, for we are thoroughly convinced
that the more it is sifted, the more clear and palpable will become the
fallacies of our financial empiric. But we frankly avow our anxiety that
he may not be permitted through such a begging of the question, to
escape from his present difficulties. Let him show, if he can, that his
Act of 1844 was the natural and inevitable result of his previous
measures, and then we may be in a situation to condemn the whole of them
together. But if it is not so, but a mere device of his own to show his
admirable mechanical skill, let him defend it on its own merits. That it
has acted banefully on the currency, no man can deny. It is quite clear
that it has led to an enormous depreciation of property; and the very
fact, that, notwithstanding the unprecedented pressure, the general
credit has been maintained, is above all others the strongest proof that
the pressure was utterly uncalled for. The point for immediate
consideration simply resolves itself into this: are we to leave
untouched upon the statute-book, a law which can at any time expose us
to the inevitable hardship of a monetary crisis like the present?--Are
we to continue and approve of an Act, the operation of which is, in
certain circumstances, to drain dry the fountain of our currency, and
that at the very time when an expansion of the currency is required? We
do not want to hear from Sir Robert Peel, any more than from an
itinerant lecturer, his definition of the nature of a “pound.” What we
want is a fair current representative for our property, without an
adequate supply of which, that property becomes stationary and is
depreciated. The depreciation of the last few months has, upon the most
moderate calculation, swallowed up at least two years of the surplus
capital of the country, and yet we are told that such a state of things
is not only necessary but wholesome! We are quite aware that it is in
vain to look for any remedy at the hands of the Whigs. They are at
present in a state of most hopeless bewilderment on the subject;
trusting in the first instance to Sir Robert Peel, and in the next to
the chapter of accidents. A good harvest they think will be sufficient
to remove all immediate difficulty; prices will again revive, and the
monetary distress be forgotten. We pray most earnestly that the first
part of their anticipations may prove correct, but we shall not on that
account relax in our exertions to overturn a system which may at any
moment expose us to the recurrence of a similar calamity.
With very few exceptions the whole of the public press is with us, and
we can hardly believe that the intelligence of the nation is not
adequate to work out its own relief. In fact, out of the House of
Commons there is hardly a single man who does not reprobate the
continual tampering with the currency, which, next to his marvellous
power of tergiversation, is the leading characteristic of Peel: nor
would his measure of 1844 have been carried but for his confident
puffing of the merits of his own machinery, and the almost universal
belief in his talents as a financial minister. The bankers, and all
those--who were familiar with monetary matters, and who, from long
experience, were gifted with foresight and sagacity, not only
entertained but expressed the most serious doubts as to the permanent
working of the act. But all warning was rejected with scorn by our
political dictator, who was resolved to have his own way; and at the
present moment we are reaping the delectable harvest of our confidence.
We have already spoken, quite fully enough, of the manner in which the
unanimous remonstrance of the Scottish bankers was received. The fact
that their representation was backed by the unanimous voice of the
public, beseeching that they might be left alone without any legislative
interference, went for nothing in the eyes of Sir Robert. He had, to say
the truth, too much power, and he never was chary in abusing it. He
dealt with Scotland as if she were an insignificant colony, too ignorant
to regulate her own monetary affairs, and too weak to resist any show of
forcible aggression. In the plenitude of his rashness, however, he
displayed the same disregard to public opinion in regulating the
currency of England; and we shall now proceed to detail a very few of
the several warnings which he has received.
In 1844 the following document was laid before him; and we surely do not
exaggerate its importance when we say, that it proceeded from a body of
men whose opinions, upon monetary subjects, were entitled to be listened
to with the utmost respect and deference:--“We, the undersigned bankers
of London, are induced, by the importance of the measure and our
interest in its success, to address you upon the subject of the Bank
Charter Bill, now before parliament. We were led to believe, when the
measure was first brought forward, and we feel confident it was
generally understood throughout the country, that although it was the
intention of her Majesty’s government that the paper Circulation of the
Bank of England, in their issue department, should be limited to an
amount not exceeding £14,000,000, upon securities, yet, that in the
event of any particular crisis arising, a power was to be reserved by
the bill enabling the Bank of England, with the consent of the first
Lord of the Treasury, the Chancellor of the Exchequer, and the Master of
the Mint, to extend their issue upon securities beyond that amount. It
is with considerable surprise that we find that the bill now before the
House of Commons does not contain any provision for an extension of the
issue beyond £14,000,000, upon securities, excepting under the special
circumstances named in the fifth clause of the bill now before
parliament. We are apprehensive that the absolute limitation of the
issue to £14,000,000, without any power of expansion reserved, whether
that amount be in itself a proper amount or not, will create a general
feeling of uneasiness throughout the country, and, by preventing the
satisfactory reception of the measure, will deprive the scheme of many
of the advantages it possesses, and interfere with its success. We
respectfully submit that the effect of such an absolute limitation _will
be to restrict the business of the country by leading to a general
withdrawal of legitimate accommodation_, unless some power be reserved
by the bill for extending the issue with the sanction of the authorities
above alluded to in cases of emergency, to be made apparent to such
authorities.”
This memorial, to which were adhibited the signatures of every eminent
banking firm in London, was treated by Sir Robert Peel with the most
calm and imperturbable indifference. The warning and the danger so
distinctly described and foretold had no effect in altering the
resolution of the intrepid baronet. He had made up his mind to place the
country permanently in commercial fetters, and no representation of the
consequences would cause him to swerve from his purpose. It would have
been well if at that time he had reflected with a little respect upon
the opinions entertained and expressed by his own venerated father--a
man of that sound sagacity and peculiar clearness of conception which
are incomparably more valuable than talents of an adroit and plausible
description. We wish that those few of his old supporters and adherents
who are in the daily habit of diluting the monetary notions of their
idol, would refer to the views which were enunciated by the elder Peel
in his remarkable letter of 1826, addressed to the members of both
houses of parliament. It is surely not unfair to recall the words of the
father as powerful evidence against the destructive theories of the son.
Sir Robert Peel, senior, writes thus:--"In the enlarged scale of
business carried on by this country, embracing a great variety of
pursuits, a reliance on a metallic circulation alone ever did, and ever
will fail us. Gold, though in itself massy, often disappears in
consequence of war or speculation--nay, the breath of rumour itself is
sufficient to disperse it. Our domestic concerns are interrupted, and
confidence lost, for want of an ample and approved medium of traffic.
"I am no friend to an unrestrained issue of paper money, and saw with
concern, in the absence of a due quantity of specie, bills admitted into
circulation issued by persons of respectability, possessing property,
but evidently unable to meet a sudden and large demand upon them. More
than two years ago, I mentioned to a friend, high in his Majesty’s
councils, my fears of the mischief likely to ensue if the practice were
not discontinued; accompanied with a suggestion to confine future issues
of paper money or tokens to the Bank of England and other competent
bodies of men, _who would give security in land, the public funds,
canals, buildings, or other tangible property_, amounting at least to
one-half of the value of their bills or tokens in circulation. My
proposition was not favoured with any notice; yet, had it been adopted,
I am of opinion that most of the panic and distress now so severely felt
in the nation would have been avoided. If such an improvement in the
banking system could be made available, gold would become less
requisite, and the country be supplied with a stationary medium of
exchange originating with ourselves.
"The present panic and distress in the country have been declared by
high authority to proceed from ‘overtrading’ and ‘wild speculation.’
Infant nations and establishments are liable to miscarry from want of
experience and solidity. TRADING and SPECULATION, being natives of this
island, and parents of our wealth and independence, are surely exempt
from such an imputation. The same authority has declared, that ‘gold and
paper money are incompatible with each other, and cannot exist
together.’ _The population and trade of the empire having been much
increased, a proportionate increase in the medium of circulation is
called for_; and when gold is found insufficient, recourse must be had
to paper, which if improved on the principle already suggested, the two
substances would be found in the same pocket without disunion.
“Anxious to see our situation ameliorated, I trust the currency may be
mended without changing or impairing the national commercial
character--which measure, if resorted to, would resemble the policy of
diverting from its course a powerful river that had long given fertility
and happiness to a large district, merely because, from excessive rains,
it had sometimes exceeded its natural limits, and produced partial
injury.”
A sounder and a clearer view of the sole legitimate control which
government is entitled, for security of the public, to exercise over the
issues of the bankers, cannot be found than this. The elder baronet was
fully alive to the gross absurdity of the bullionists who literally make
toys of their coin. He recognised to its fullest extent the salutary
principle that REAL PROPERTY is, after all, the only proper basis of
circulation: and he would have laughed to scorn the idea of an arbitrary
restricted issue, as the certain means of inflicting a paralytic stroke
upon the energies and the enterprise of the nation. The total neglect of
this view is the capital error of the son. He depreciates the value of
real property, by depriving its possessor of the power to command at any
time its cheap and commodious representative; and he forces us, under
the most adverse circumstances to hunt for gold, and not improbably to
humiliate ourselves in time of need, by an application to the hoarding
Russian.
We entreat the public attention to the fact, that the banking system and
mode of circulation suggested by the elder Sir Robert Peel, is in fact
precisely that which was followed out by the Scottish banks, without
failure, without complaint, and with incalculable advantage to the
country, before the late premier commenced his wanton interference with
our institutions. Heaven only knows what amount of suffering we must
undergo until the public mind is thoroughly roused to the evils which
have resulted from a weak and imbecile confidence in the nostrums of a
theoretical minister, and until the money trade is freed from its
present most odious restrictions. But we cannot, and we think we ought
not, to conceal our conviction that the present monetary crisis is
directly owing to the Restriction Act, and that the whole empire, and
Scotland in particular, has reason to curse the hour when Sir Robert
Peel thought fit to embark on his financial crusade.
We are glad to see such men as Mr Baring and Mr Newdegate protesting in
the lower House, against the iniquity of the present system, and
exposing its operations in detail. It is in vain that the Chancellor of
the Exchequer--whose deference to the opinions of Sir Robert Peel is so
ludicrously displayed--attempts to raise his voice in defence of
restriction, and to attribute to other causes the deficiency which he
cannot deny. Even Peel himself, as we have already remarked, is fain to
blink the question, and to escape from the attacks of his antagonists,
by the stale artifice of confounding and contrasting their opinions. The
memorable debate in the House of Commons on the 10th of May, has, if we
are not widely mistaken, established a principle which must lead to
important party results; and we would earnestly beseech those who have
the welfare of their country at heart, to make this matter of the
currency a leading consideration in the use of their electoral
franchise.
We have already shown the manner in which Sir Robert Peel was pleased to
treat the respectful remonstrance of the English bankers, and the total
variance of his financial views from those which were entertained by his
excellent and honoured parent. We now take leave to draw the attention
of our readers to a rather remarkable passage in Mr Alison’s late
pamphlet, entitled “_England in 1815 and 1845_.”
We need hardly state our reasons for declining to criticise that work.
We agree entirely with the views entertained by that eminent writer; and
we should be happy indeed, could we state our own arguments with a force
and a precision at all commensurate with his. Sir Robert Peel, however,
in the course of the year 1845, thought proper to make this pamphlet the
subject of his remarks, and concluded, _more suo_, with a sneer at Mr
Alison, which, apart from its propriety, does not strike us as
particularly clever. The point at issue was rather a trivial one; for
Sir Robert, as usual, did not apply himself to the main body of the
argument: he neither impeached the facts nor the conclusions of Mr
Alison, but fastened upon an incidental point of no great value or
importance. The attack, however, had this good effect, that it elicited
a reply from Mr Alison, in which he points out so distinctly the results
of the restrictive measure, that we cannot do better than transfer an
extract from his Postscript to our pages. It is proper to observe, that
this Postscript was published _two years ago_, and we leave the public
to judge of the accuracy of M. Alison’s observations:--
“Whoever,” says he, referring to the Banking Act of the preceding
year--"whoever considers these provisions with attention, will see that
they practically introduce two things: 1st, A limitation of the issue of
Bank of England notes to £14,000,000 on securities, with the addition of
the specie and bullion transferred to the issue department:--2d, A
limitation of any further issue to the amount of such securities,
bullion and specie. It is the avowed object of the Act to base the
circulation of the bank on these three things. And the opinion of its
supporters has been repeatedly expressed that they constitute the only
safe foundation of banking operations. If, therefore, the specie is
drawn out by the holders of notes who are declared entitled by the Act
to have their notes paid at £3, 17s. 10½d. an ounce of gold, it follows,
of course, that the notes in circulation must be diminished in the same
proportion. They cannot issue notes beyond the £14,000,000, _except in
exchange for specie or bullion_--the most effectual of all ways for
limiting the issue to their amount.
"_Now, suppose a bad harvest, such as we have narrowly escaped, occurs,
when undertakings of a gigantic nature are on foot, and a large quantity
of specie is drawn from the bank to purchase foreign grain or other
subsistence, what, under the existing law, must be the consequence?_
Must it not be that the paper circulation of the Bank of England and of
course of every other bank, will be simultaneously and rapidly
contracted? Their own notes pour in to be exchanged for specie to buy
foreign grain, or make the necessary remittances to foreign
undertakings. They cannot issue new ones beyond the £14,000,000, except
in exchange for specie or bullion, which is the very thing they are
every day losing, and which is bought up in all parts of the country for
foreign exportation. The result is inevitable, that their notes must be
called in as rapidly as the sovereigns go out. The screw must be put on;
the circulation must, at all hazards, be contracted. If £10,000,000 of
sovereigns are _drawn out_ to buy foreign grain, or to meet a demand for
gold in foreign states, £10,000,000 worth of notes must be _drawn in_ to
equalise the paper with the stock of gold and silver above the
£14,000,000 authorised to be issued on paper securities. _The
circulation will thus be diminished by £20,000,000, or nearly a third of
its amount_, and that at the very time when the public interests most
loudly call for its extension.
“That may occur, too, at a time when speculations the most weighty are
on foot, and the currency previously in circulation is most required for
the wants of the community! The evil will not thereby be doubled: it
will be quadrupled. Like all mischievous panics, its effects will go on
as the squares. Is it possible to contemplate such a state of things
without the most serious apprehensions: without deep regret that it
should be established and perpetuated by acts of parliament? Does it not
annul the best effects of a paper currency, that of having an elastic
quality which causes it to expand when the metallic currency is
contracted, and so obviate the ruinous and lasting effects of such
temporary diminution on general credit? Is it surprising, when such is
the law, that the mercantile classes watch the sky; that rain for a
month in autumn gives a serious shock to credit, and that stock of all
kinds rises or falls with the changes of the barometer? The Banker’s Act
of 1844 should be styled--‘An Act for the more effectual transferring of
panics from agriculture to commerce, and for perpetuating commercial
catastrophes in Great Britain.’”
When we compare the events predicted in this remarkable passage with
those which have actually taken place--when we reflect that a bad
harvest _has_ occurred, that our gold _has_ been drained, our paper
circulation contracted, and the screw put on--we think there are few
commercial men in the country who will not agree with us in wishing that
Sir Robert Peel had really accepted Mr Alison “as the philosopher who is
to instruct us on the currency.” For, most assuredly, there is no kind
of philosophy which we can discover in the scheme that is now being
tested at the expense of the merchants and manufacturers of the three
kingdoms; unless it should be held philosophic that the whole commercial
machinery of the country shall be exposed to annual dislocation, and
that credit shall hereafter be liable to the present alarming point of
contraction. Parliament, as we understand, is about to separate, without
doing any thing whatever to remedy this monster grievance. Let the Whigs
look to it. They are now to all intents and purposes the aiders and
abettors of Sir Robert Peel. They hang upon his words, adopt his
principles, and applaud his maxims to the skies. They hear from every
quarter of the country the cry of unparalleled distress. An evil much
greater than the scarcity is pressing upon the industrious classes,
interfering with labour, checking trade, and depreciating the value of
every kind of property. Manchester has been nearly at a stand-still, not
from want of orders but from absolute want of accommodation; and yet the
present ministry have neither the courage nor the capacity to step
forward and afford that relief which is in their power, and which the
nation is demanding at their hands. If, during the recess, and before a
new parliament shall meet, the present lamentable state of matters is to
continue, we say deliberately that no British ministry ever exposed
themselves to such a frightful load of responsibility. Let them share it
with their new ally and master. It may be that he intends, at some
future time, to make a second push for popularity by throwing them
overboard, and repealing his own most mischievous statute. But we trust
that the electors throughout the country will take care that the new
representative body shall not be constructed of the same malleable
materials as its predecessor, and that no more experiments, involving
the national prosperity and fortunes, shall be permitted, for the mere
sake of gratifying the caprice and augmenting the vanity of an
individual who has already brought the whole of us so close upon the
verge of ruin.
_Printed by William Blackwood & Sons, Edinburgh._
FOOTNOTES:
[1] _History of the Conquest of Peru; with a Preliminary View of the
Civilisation of the Incas._ By WILLIAM H. PRESCOTT. London: 1847.
[2] El Kebir, or the Great, is a term by which Mohammed Ali is usually
designated among the fellahs of Egypt, to distinguish him from the mob
of Pashas and the crowds of Mohammed Alis. Napoleon was called also El
Kebir, as the greatest among the Ferenk dogs of the West.
[3] _The Life of Jean Paul Frederick Richter._ London: Chapman, 1845.
[4] _Allemagne._ English translation. London: 1813. Vol. ii. p. 339.
[5] A work on the Immortality of the Soul--a favourite theme with
Richter.
[6] “Unitarian,” in the Political Dictionary of South America, is
opposed to “Federal.” Rosas pretends to govern on “Federal”
principles--that is, the separate legislative independence of each
province of the “Confederation;” but, in fact, he has made himself a
Unitarian, since he _unites_ in himself (by “extraordinary powers,”
given to him only for a season, but retained ever since) a supremacy
over the other provinces, and over the law and constitution.
[7] Maza, the president of the Sala of Representatives, and a high
officer in one of the courts of justice, was murdered in (or close to)
the senate house; his son was murdered the same evening; and no judicial
inquiries ever took place in consequence. Why?--Because, of course, it
was done by authority.
[8] Dollars in Buenos Ayres mean small notes manufactured in London!!
they used to be made payable at a national bank, in metallic dollars,
and then they represented a silver dollar. This bank has been abolished,
thanks to the “Great Restorer of Laws,” and these paper dollars now vary
from 1½d. to 4d. The arrival or departure of a vessel of war, with
important despatches, will, in one day, cause a doubloon (about £3, 8s.)
to be worth, say three hundred dollars, and next day worth four hundred,
much to the embarrassment of trade--metallic dollars not being current
money.
[9] “Let the Federals live--let the savage, dirty, ruthless Unitarians
die!”--or, Up with the Federals--down with the----Unitarians!
[10] Ladies in South America are more passive to parental authority,
than in England, in respect to the momentous question of selecting a
husband.
[11] _A History of the Royal Navy from the Earliest Times to the French
Revolution._ By Sir NICHOLAS HARRIS NICOLAS, G.C.M.G.
[12] _Maritime and Inland Discovery_, Vol. i. p. 230.
[13] If Sir H. Nicolas has no other authority for this fact of its being
extinguished by vinegar than the extract which he afterwards gives from
Vinesauf,--it does not stand on a very secure basis. “This fire, with a
deadly stench and livid flames, _consumes flint and iron_! and
unquenchable by water, can only be extinguished by sand or _vinegar_.”
The story about the vinegar comes, we see, in very suspicious company.
[14] _Hallam’s Middle Ages_, vol. iii. p. 397.
[Transcriber’s Note:
Obvious printer errors corrected silently.
Inconsistent spelling and hyphenation are as in the original.]