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which it is asserted will operate in raising the price of wheat to this standard, they should begin at the other end of the scalethey should assume 60 shillings as the money value, above which no legislative enactments can raise the price of a quarter of wheat, on the standard of a pound sterling containing 120 grains of gold, and should make a reduction in every item of the expense incurred in producing it—in the nominal amount of rent, tithes, taxes, wages of labor, and other outgoings-proportioned to the nominal reduction which the alteration of the standard has made in its selling or market price.

In the numerous and tedious manifestoes, which the members of the Agricultural Association have poured upon the public, they assert, and assert correctly, that the present difficulties of agricul ture must be ascribed principally to the contraction which has taken place in the currency; but they do not seem to entertain a very correct idea of the nature of this contraction, nor of the means by which it has been produced. They seem to consider it as the consequence of a capricious determination, on the part of the Bank, to lessen its issues. But the truth is, that the whole quantity of the currency now in circulation is in real and intrinsic value, equal to the whole medium of exchange circulating at the most prosperous moment of agricultural speculation. The present currency is nominally more contracted than the former circulating medium-it does not amount to the same number of pounds sterling as the former; but the value of each of these pounds is increased in the precise ratio that the number of the whole is diminished. Assume, that previously to the restoration of a metallic currency, the whole produce of this country was represented by 400 millions of paper pounds sterling, and that a return to a metallic standard increased the value of this pound 25 per cent. ;-The result must be, a contraction of the numerical amount of the currency from 400 to 300 millions; but these 300 millions of pounds sterling, containing each of them 120 grains of gold, would be precisely equivalent to 400 millions, each of them containing only 96 grains of the same metal.

From the dry and tedious detail into which I have been led, by the extreme importance of the subject discussed in this and the preceding letter, I draw the following conclusions:

The distress which now presses upon agriculture does not arise from an excessive supply of agricultural produce.

It does not spring from a diminution in the average consumption of agricultural produce.

The importation of foreign corn has no permanent influence on the money price or exchangeable value of that which is of home growth.

Further fiscal restrictions might prevent the introduction of foreign grain into this country; but such a measure would de

prive the State of that portion of this foreign produce which at present flows into the Exchequer as excise duties levied on articles of consumption.

The distress, in which the agriculturists of this kingdom are now involved, arises principally, if not exclusively, from the financial derangement produced by an alteration in the currency which has had the practical effect of raising the standard value of the metallic pound sterling from 96 to 120 grains of gold.

The only measures, therefore, which can afford relief to those who suffer by this derangement are either, the restoration of the standard of the metallic pound sterling to the weight of gold which it really would have exchanged for in the market during the existence of a paper currency, when all, or at least nearly all, the pecuniary stipulations of the community were settled; or, a reduction in the nominal amount of claims upon all debtors, who have contracted pecuniary engagements since the suspension of cash payments by the Bank, in 1797, proportioned to the variation produced in the value of the pound sterling, by the substitution of a metallic for a paper standard.

Thus, Sir, have I endeavoured to explain the views which I entertain, of the cause which has produced the distress of which the agriculturists of this kingdom, at the present moment, so loudly and so justly complain: I may have explained and defended them unskilfully; but they are views which I have not conceived hastily. My opinions, like those of others on this intricate subject, may be erroneous-I lay no claim to infallibility; an assertion that I feel a firm conviction of their truth will not prove them to be well founded; but it will exonerate me from the imputation of presumption in making them known. What attention they are likely to attract, on the part of the public, is more than I can venture to conjecture; but, I feel persuaded, that if they are of any importance, they will receive from you, at least, all the consideration to which they are entitled. As the member of His Majesty's Government, whose province it is more particularly to attend to the regulations which may either directly or indirectly affect the commercial interests of this country, I am justified in calling upon you to press upon your colleagues in office the immediate consideration of the state of our currency. It appears to me by far the most important subject which, for centuries, has engaged the attention of the legislature; and not a moment should be lost by those who wish to rescue the agricultural class of the community from absolute ruin: the attention of Parliament should be instantly called to the unjust and ruinous VOL. XIX. NO. XXXVII.



pressure which the late regulation of the currency has thrown upon the farmer.

We are, at present, placed in a situation unexampled in the history of any other nation that ever existed. This great country was never really richer than at the present moment; the produce of the soil was never more various nor more abundant; and the condition of the grower of this produce never ought to have been easier or more comfortable. But notwithstanding all these apparent advantages, which ought to be the causes and symptoms of unalloyed natural and individual prosperity, the cup of enjoyment has been dashed from our lips by one unskilful stroke of the Chancellor of the Exchequer's wand. An unfortunate and unintentional variation in the standard of value, produced by an injudicious mode of substituting a metallic for a paper currency, has spread throughout a great portion of the community more various and extensive distress than could have resulted from all the bad measures of the worst ministers that ever lived-distress more appalling and irretrievable than could have resulted from the instantaneous and absolute annihilation of one fourth the real and personal property in the kingdom, The meritorious, the industrious, and the injured body of English occupiers now call upon the legislature to take their situation into consideration. They ask, not for eleemosynary relief, but for justice; they declare that if the legislature does not lower the value of the pound sterling, and the land-owners refuse, in time, to lower the nominal amount of rents-their whole property must be completely sacrificed to the integrity of that measure of value which takes from them 120 grains of gold instead of 96 grains of the same metal, which they had engaged to pay.

May 10, 1821.


NO. I.

Resolutions proposed by Francis Horner, Esq., in a Committee of the whole House of Commons, May 6th, 1811; and negatived May 10th.

1. That the only money which can be legally tendered in great Britain, for any sum above twelve-pence in the whole, is made either of gold or silver; and that the weight, standard, and denomination, at which any such money is authorized to pass current, is fixed, under His Majesty's prerogative, according to law.

2.-That since the forty-third year of the reign of Queen Elizabeth, the indentures of His Majesty's Mint have uniformly directed that all silver used for coin, should consist of eleven ounces and two penny-weights of fine silver, and eighteen penny-weights of alloy, in each pound Troy; and that the said pound Troy should be divided into sixty-two shillings, or into other coins in that proportion.

3.-That since the fifteenth year of the reign of King Charles the Second, the indentures of His Majesty's Mint have uniformly directed that all gold used for coin, should consist of eleven ounces of pure gold, and one ounce of alloy, in each pound Troy; and that the said pound Troy should be divided and coined into forty-four guineas and one half-guinea, or into other coins in that proportion.

4. That by a Proclamation of the fourth year of the reign of King George the First, it was ordered and directed, that guineas, and the several other gold coins therein named, should be current at the rates and values then set upon them; viz. the guinea at the rate of twenty-one shillings, and other gold coins in the same proportion: thereby establishing, that the gold and silver coins of the realm should be a legal tender in all money payments, and a standard measure for ascertaining the value of all contracts for the payment of money, in the relative proportion of 1588 pounds weight of sterling silver to one pound of sterling gold.


5.-That by a statute of the fourteenth year of the reign of His present Majesty, subsequently revived and made perpetual by a statute of the thirtyninth year of his reign, it is enacted that no tender in payment of money made in the silver coin of this realm, of any sum exceeding the sum of 251. at any one time, shall be reputed in law, or allowed to be, a legal tender, within Great Britain or Ireland, for more than according to its value by weight, after the rate of 5s. 2d. for each ounce of silver.

6. That by a Proclamation of the sixteenth year of the reign of His present Majesty, confirmed by several subsequent Proclamations, it was ordered and directed, that if the weight of any guinea shall be less than five penny-weights and eight grains, such guinea shall cease to be a legal

tender for the payment of any money within Great Britain or Ireland; and so in the same proportion for any other gold coin.

7. That under these laws (which constitute the established policy of this realm, in regard to money) no contract or undertaking for the payment of money stipulated to be paid in pounds sterling, or in good and lawful money, of Great Britain, can be legally satisfied and discharged, in gold coin, unless the coin tendered shall weigh in the proportion of parts of five penny-weights and eight grains of standard gold for each pound sterling, specified in the said contract, nor in silver coin, for a sum exceeding 25%, unless such coin shall weigh in the proportion of of a pound Troy of standard silver for each pound sterling specified in the contract.

8. That promissory notes of the Bank of England are stipulations to pay, on demand, the sum in pounds sterling respectively specified in each of the said notes.

9. That when it was enacted by the authority of Parliament, that the payment of the promissory notes of the Bank of England, in cash, should for a time be suspended, it was not the intention of Parliament that any alteration whatsoever should take place in the value of such promissory notes.

10. That it appears, that the actual value of the promissory notes of the Bank of England (measuring such value by the weight of standard gold and silver aforesaid, has been) for a considerable period of time, and still is, considerably less than what is established by the laws of the realm to be the legal tender in payment of any money-contract or stipulation.

11. That the fall which has thus taken place in the value of the promissory notes of the Bank of England, and in that of the Country Bank paper which is exchangeable for it, has been occasioned by too abundant issues of paper currency, both by the Bank of England and by Country Banks: and that this excess has originated from the want of that check and control on the issues of the Bank of England, which existed before the suspension of cash payments.

12. That it appears, that the exchanges with foreign ports have for a considerable period of time been unfavorable to this country, in an extraordinary degree.

13. That, although the adverse circumstances of our trade, together with the large amount of our military expenditure abroad, may have contributed to render our exchanges with the continent of Europe unfavorable; yet the extraordinary degree in which the exchanges have been depressed for so long a period, has been, in a great measure, occasioned by the depreciation which has taken place in the relative value of the currency of this country as compared with the money of other countries.

14.-That during the continuance of the suspension of cash payments, it is the duty of the Directors of the Bank of England to advert to the state of the foreign exchanges, as well as to the price of bullion, with a view to regulate the amount of their issues.

16. That the only certain and adequate security to be provided against an excess of paper currency, and for maintaining the relative value of the circulating medium of the realm, is the legal convertibility, upon demand, of all paper currency into lawful coin of the realm.

16. That in order to revert gradually to this security, and to enforce meanwhile a due limitation of the paper of the Bank of England, as well as of all the other Bank paper of the country, it is expedient to amend the Act which suspends the cash payments of the Bank, by altering the time till which the suspension shall continue, from six months after ratification of a definitive treaty of peace, to that of two years from the present time.

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