CHAP. XXXVII. 1839. 43. Immense effects of this drain of gold on both sides of the Atlantic. It is not surprising that the merchants, both of Great Britain and America, watched with trembling anxiety the rains of August and September 1839 in the British. Islands; for their consequences, under a currency in the heart of commercial circulation dependent on the retention of gold, were immense on both sides of the Atlantic. By stopping suddenly the credit given to the American houses by the London banks, it at once spread bankruptcy throughout the United States, occasioned the suspension of the United States Bank and all the other banks of America in the October of that year, and diffused general ruin over the whole of the trading classes in the country. The effects in Great Britain were not less calamitous, and from its being an old State, with complicated commercial relations, and without the boundless resources of the back settlements, they were there of much longer continuance, and recovered from with more difficulty. The bankruptcies, which had been very frequent ever since the abolition of small notes, and consequent limitation of bank accommodation in 1829, became fearfully numerous in 1839 and 1840-nearly double of what they had been five years before.* They increased in weight as much as in number in those disastrous years; for the houses engaged in the American trade, and which had accepted the bills in 1838, which for a year averted the ruinous effects of General Jackson's crusade against the banks in the United States, were among the greatest and most wealthy that ever had existed in Great Britain. surplus of our industry, but now we wait with feverish anxiety the state of the English harrest, not so much from motives of commendable sympathy, but fearful lest its anticipated failure should narrow the field of credit there.”—President VAN BUREN'S Message, Dec. 3, 1839; Ann. Reg. 1839, pp. 453, 455 (Public Documents).—What a picture of the effects, throughout the whole commercial world, of a currency in Great Britain dependent on the retention of gold, and so liable to be disturbed by every rain that falls! * BANKRUPTCIES IN GREAT BRITAIN. XXXVII. 1839. The effects of the failure of these great houses, and of CHAP. the universal contraction of credit from banks, were to the last degree calamitous in this country, and produced that universal fall of prices and widespread distress among the labouring poor, which could not fail to end in public convulsions or an entire change in the system of policy of government. 44. Belgium The shock given to commercial credit over the world by the run upon the Bank of England in 1838 and 1839, Panic in was felt nearly as severely in Belgium and France as in and France. the United States or the commercial towns of England. In September 1838 the Bank of Belgium failed, which spread consternation and distrust over the whole of the Low Countries; and at the same time the panic was so great in Paris that Lafitte's bank with difficulty weathered the storm. The bankruptcies in France in those years told the same melancholy tale of widespread and consuming distress which those of Great Britain and America had done. The effect of these disasters, of course, was to extend the distrust and stagnation in Great Bri-Tooke, iii. tain, and augment the number of those thrown out of Ann. Hist. employment, as well as the profits or salaries of those 749. still engaged in business.1 74, 75; xxi. 742 These effects soon appeared in every imaginable way 45. in the British Islands. Everywhere was told the same Distress in unvarying tale of bankruptcy, suffering, and want of em- Britain. ployment. It is true, the poor-law returns,* owing to the * EXPENDED ON THE POOR, AND PERSONS RELIEVED IN Great XXXVII. 1839. CHAP. efforts made by the Poor-Law Commissioners to keep down charges, did not exhibit any great increase in these years; although the great apparent decrease of £2,000,000, so much boasted of at first, was almost entirely owing to the extremely low prices of food in the years 1835 and 1836. But the number of paupers increased in a frightful progression, insomuch that in the year 1840 they amounted to 1,721,000 out of a population at that period not exceeding 16,000,000,-showing that more than ONE IN NINE of the whole population had become a recipient of public charity. At the same time, the paupers in Ireland were 2,285,000, and in Scotland, 85,000, making a total of 4,081,000 in the British Islands, or fully a seventh part of the whole population, which at that time was about 27,000,000. The increase of crime in these years told a similar woeful tale of suffering in the labouring classes the committals had swelled from 20,000 in England and Wales in 1833, to 31,000 in 1842.* It was no wonder that crime and pauperism were advancing with such rapid strides over the land, for the condition of the working classes had become miserable in the extreme. The wages of agricultural labour in Ireland were only 3d. a-day; the weavers in England could earn no more ; and the authentic record of what wages should be made up to in the rural districts of the south of England,1+ proves that they had fallen so low as to be inadequate to the support of a human being on the very lowest species Double of Peel, i. day's Life 507; Ann. Reg. 1839, 507. + Scale of allowance to which farm-labourers' wages were to be made up by the magistrates of Dorset in 1830:— of food. In fact, they were scarcely more than was at CHAP. the same time earned by the Ryots of Hindostan. XXXVII. 1839. prices was ing. It was the incessant fall in the price of commodities of 46. every sort which had now gone on, with only two periods Decline of of intermission of two years each, for twenty years, which the cause of was the cause of this universal and unheard-of distress. this sufferWith the exception of the years 1824 and 1825, when the Small-Note Bill temporarily suspended the decline, and the years 1834 and 1835, when the Joint-Stock Banks Bill, and bill making Bank of England notes a legal tender save at the Bank of England, produced the same effect, the whole period from 1819 to 1839 had been one of incessant fall of prices. The chief articles of commerce had declined in money value during that time 50 per cent, many much more.* Such a long-continued and prodigious fall of prices filled all classes with despair. True, they * The following most valuable Table of Prices was prepared with great care by Mr Taylor, and presented by him to the Commons Committee on Commercial Distress in 1848, and is to be found in their Report. The price of each article at the commencement is taken as the standard :— XXXVII. 1839. CHAP. bought everything cheaper, but what did this cheapness avail them when the wages of labour came down in a still greater proportion, when two millions of destitute paupers in Ireland were at every moment ready to inundate the labour market of England, and employment even on the lowest rates was often not to be had, from the discouragement to speculation of every kind which the continual fall of prices occasioned? The only thing which rendered this fall tolerable to the working classes in towns and the manufacturing districts, was the extremely low price of the necessaries of life which the magnificent harvests from 1832 to 1836 occasioned; but this reduced the agricultural classes to despair; and the table of the House of Commons groaned, during these years, under petitions which set forth with truth, that under existing prices cultivation of any kind could be carried on only at a loss.* And when the bad seasons began in 1837, and five cold and wet autumns in succession raised the cost of food, even of the humblest kind, again to the war rates, which were then felt as famine prices, a still more general and acute suffering was experienced by the manufacturers ; for in proportion to the decline of their wages, from the contraction of the currency and consequent commercial distress, was the rise in the cost of the necessaries of life from the badness of the season. This unparalleled series of internal disasters produced a very important and lasting effect upon the administra * COMPARATIVE FALL OF FOOD AND OF WAGES OF WEAVERS AND COMBERS, AND PRISONERS IN WAKEFIELD PRISON, IN THE UNDERMENTIONED YEARS. |