the country, and, to a certain extent, a destructive power over the commerce that provides the bullion.

Lord King, in his pamphlet on the Bank Restriction of 1797, observes, p. 83. :—

"A due regard to general rules, and especially to the great rules of property, forms a most important part of the duty of a legislator. They are the foundations of all private and political security."

P. 84.:

"A law to suspend the performance of contracts has been suffered to remain in force upwards of six years. A power has been committed to the directors of the bank, which is not intrusted by the constitution even to the executive government; a power of regulating, in a certain degree, the standard of the currency of the kingdom, and of varying this standard at their pleasure. precedent has been established, by which, upon any suggestion of temporary expediency, the whole personal property and monied interests of the country may be committed to the discretion of a commercial body not responsible to the legislature and not known to the constitution."

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"This extraordinary measure, which originated in embarrassment and temporary difficulties, has been suffered to continue from mere inadvertence. Neither the public nor the legislature appear to have considered to what consequences such proceedings ultimately tend. Had Parliament been called upon to authorize any of those direct frauds upon the currency which have often disgraced arbitrary governments, had it been recommended to them to raise the denomination, or to diminish the value, of the current coin, there can be no doubt that such a proposal would have been rejected with indignation. Yet an abuse of the same nature has been established by law in this country. The power of reducing the value of the currency, by a silent and gradual depreciation, is more dangerous from the very circumstance of its being less direct and less exposed to observation."

The preceding very just remarks are worthy of the consideration of the advocates of the "exclusive powers and great privileges," at present conferred upon the Bank of England by the Act of 1844.

The power of raising the value of the currency is the same abuse as the power of reducing the value of the currency, which is here considered in the same. light as raising the denomination or diminishing the value of the current coin: it is, in fact, to raise or lower the prices of commodities.

It appears to me, that instead of watching the period when the war should terminate, six months after which, the Bank of England was, by the Act of Parliament, bound to resume cash payments, we are now directed to watch the increase or diminution of bank notes in the coffers of the banking department, called the reserve; instead of a bank restriction terminating with the war, when low prices were to be expected that gold might flow into the bank, the country is to watch the diminution or probable exhaustion of the reserve, and to regulate commerce accordingly: the bank has all the immunity of a bank restriction when its coffers are abundantly supplied; and can impose the stringency of the former return to cash payments, when the stock of gold or the reserve is reduced to an amount inconsistent, in the opinion of the directors, with the safety of the bank. Instead of one return to cash payments at a definite period, the country is subject to the same loss and distress at different undefined periods, perhaps at intervals of seven years.

Louis XI., of France, (A.D. 1483,) was the last of the kings who raised a revenue, in their necessities, by tampering with the coins; having a meadow, as this same king said, which they could at their pleasure mow; alluding to the power of taxation. (Ayant un pré qu'ils tondent quand bon leur semble.*)

Will the advocates of the present system of the bank monopoly say that they need no more a bank restriction, having a meadow, in the commodities of others, which the directors can mow at pleasure?

* Le Blanc, p. 351.

CHAP. XXX.

T. W. WEGUELIN, ESQ., ON THE EXCHANGES. ON THE BANK OF ENGLAND HOLDING THE RESERVES OF BULLION. ON THE MORAL RESPONSIBILITIES OF THE BANK. ON SCIENTIFIC AND MECHANICAL PRINCIPLES. LE BLANC AND BAZINGHEN ON THE FRENCH COINAGE. -ON THE GOLD AND SILVER STANDARD, AND BANK NOTES AND COIN. - ISSUES OF ENGLISH, SCOTCH, AND IRISH BANKS.- REMEDIAL MEASURES SUGGESTED.

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T. W. WEGUELIN, Esq., the Governor of the Bank, states in his evidence before the committee of 1857:

606. "The meaning of a favourable exchange is, "that your importations shall be in amount less than your exportations: and therefore the foreign trade "must ultimately pay for any demand which has been "made upon it for any such sudden contingency as you have alluded to" (a bad harvest).

607. "I wish to point out that the power of the bank "to act upon the exchanges is very small. It must "be the trade of the country which must influence "the exchanges. All that the bank in such a case "can do, is to defend its own position; and holding "the reserves of the country at that moment, no doubt "its position becomes a matter of very considerable "interest and importance; but it can only do that. "The trade of the country must right itself." (See p. 252.)

This evidence is quite in accordance with the new system of banking which exonerates the Bank of

England from providing the bullion, at the same time. that the bank is the depository of bullion, for which it has given promissory notes or a bank credit; it treats the foreign trade as a corporate body, just as the country was treated as a corporate body by Sir Charles Wood and Mr. Cardwell (p. 240. 293.), instead of the foreign trade consisting of the business of merchants, independent of each other, and each responsible only for his own conduct. But the foreign trade does not alone pay for the bullion required for the discharge of debt incurred by an excess of imports over exports; the foreign merchant is exposed, in common with others, to the depreciation of his property occasioned by the low prices of commodities, produced by the action of the Bank of England, in order "to defend its own position"-but the exporter may be benefited by the low prices of the commodities which he exports. Those who suffer from the depreciation of property are those who hold goods and manufactures, and those who produce those goods and manufactures; not only all the great interests, whether commercial, manufacturing, or agricultural, are exposed to this depreciation, but the owners of funded property, of foreign securities, and what is worthy of the gravest consideration of the State, the labourers employed in commerce, or manufactures and agriculture, those whose property is their labour. Let the State ponder on these things. I submit that if "the trade of the country must right itself," if the foreign trade must find the bullion, it should retain it, in order to be able "to right itself."

Sir Robert Peel's Bill assumes that a secure circulation of promissory notes can be obtained only by the monopoly of the Bank of England, and that the Bank of England must necessarily issue more promissory notes than they can pay in gold on demand; and that to supply this gold which may be wanted, beyond what they can pay from their own coffers, it is essential that the bank should have the power of increas

ing the value of the currency; in other words, of lowering the prices of commodities, whenever the directors are under the apprehension that the demand for gold for exportation will exceed their power of paying the gold on demand, which they have promised, or undertaken to deliver,

In common morality, the remedy for want of ability to perform a promise, is not to make the promise, and for an inability to perform a contract is not to make the contract.

The nation composed of separate individuals labours under no natural incapacity to refrain from making a promise, and under no natural inability to limit its promise to that extent which it can perform. A nation that can from the private resources of individuals furnish the capital for the construction of railroads to the extent of nearly 300,000,000l., could surely furnish, in the absence of the foreign demand for bullion, on the plan I suggest, the means of paying its promissory notes, or satisfying the holders of missory notes with coin to the extent of one-fifth or one-fourth of forty millions, and for every note of which they receive an immediate equivalent, and which notes cost them comparatively nothing.

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Is this question incapable of solution? Certainly Sir R. Peel discovered no solution, by his own confession: either his bill or the former state of things bounded his view of change or remedy. (Debate, May 10th, 1847.) Hansard. (See p. 230 antè.)

The capital or dead stock invested in gold and silver, although it yields no revenue, is yet the most secure from loss, and the most available of any capital in case of need.

If turnpike-roads are not frequented they are useless, and the capital is lost in making them - the same may be said of railroads; the same of unproductive mines: not so with the precious metals capital they retain their value.