ber by which to account for the rise of prices, without reference to an excess and depreciation of currency: and we think it the more necessary to state them, because the price of commodities has been gradually increasing for the last thirteen or fourteen years or longer; whereas the high price of bullion, the unfavourable exchange, and the great difference between the values of gold and paper currency, (the alleged causes of this increase,) have only existed within these last two years—years in which, if we are not mistaken, prices have been less enhanced than at any former time within the above-mentioned period.

First, it is well known that the quantity of capital and industry applied to the production of goods for exportation has very much increased within the last thirteen years. The manufacturers of these goods are so many fresh competitors in the market for the necessaries and comforts of life. But the objects of their labour form no part of the supply, none at least that is available in the market where they purchase their necessaries. This additional demand, therefore, not being accompanied by a corresponding addition to the supply, must of course raise the price of all the objects of those purchases. The additional supply is indeed subsequently raised and brought to market by the rest of the community, but not until a previous rise of price has indicated the demand for it.

Again, the scarcities of corn which have occurred since 1797 have tended much to raise the price of labour, and of every thing produced by labour; a proposition too self-evident to need other proof than a bare statement of the fact.

Lastly, the increase of taxes laid on during the present and preceding wars is sufficient of itself to account for a great proportion of the rise in all prices. The gross revenue in 1793 was about seventeen millions; in 1809 it was above seventy millions, an increase of more than four times the original amount. Now it is perfectly clear, that this sum is added to the aggregate price of all commodities purchased in the home market in Great Britain, (setting aside the trifling duties upon exports) except in as far as an increase has taken place in their production*. It would much exceed our limits, even if it were possible, to enter into a minute calculation of the increased quantity of goods bought for consumption in the home market of Great Britain; but we may perhaps venture confidently to affirm, that it is not four times as

If we understand Mr. Bosanquet's reasoning on this subject (p. 94.) we think it rather loose, as he appears to us to omit all consideration of the effect which an increase in the production of commodities has on their relative price (as increased by taxation).

"

great as in the year 1793, nor even twice as great. It cannot, we think, be nearly twice as great. If it could, we should in proportion to our population have increased in real wealth with a rapidity altogether unexampled, besides sinking a capital of a thousand millions sterling in the war. Something like a fair comparison might probably be drawn by a reference to the increased amount of duties levied by the Excise, deducting all new impositions; but we know of none but the commissioners or clerks of the Excise Office who are competent to this task. It will, however, be sufficient for us to bear in our minds the num ber of individual articles which have been additionally taxed, and must of course have risen proportionally in price; the indirect effect which the taxation of these articles has in raising the price of others; the Property Tax, the increase in the Stamp Duties, and the numerous items of general taxation having no direct tendency to increase the quantity of commodities, although they must ultimately have fallen on the consumers in an increase of price; and we think it will be impossible to avoid admitting, that a great proportion of the rise in all prices (since 1793 at least) may fairly be ascribed to the increase of taxation.

All these circumstances have been overlooked or omitted by Mr. H. and the Committee in the opinion they have given on this important subject; but they do nevertheless appear to us to form an additional combination of proof not easily rebutted, that the advanced prices complained of have not been caused by excess and depreciation of currency, but by very different cir

cumstances.

The facts just stated respecting the increased amount of the taxes afford of themselves a sufficient reply to Mr. Huskisson's observations on the alleged impossibility of paying them were the quantity of currency materially diminished. He asks (p. 144.) "Why could not the taxes be raised? How were they raised before the restriction?" We will endeavour to tell him why. Their amount before the restriction was less than onehalf of their present amount, while that of the currency was within no great difference the same. A sum barely equal to the whole currency of the country passed annually through the hands of government in the payment of taxes in 1797. Now the whole amount passes at least twice in the year through their hands. And as the produce of the taxes is increased or diminished by the greater or less rapidity with which commodities circulate, it follows that any diminution of the circulating medium must more than equally diminish the produce of the taxes, and this not" nominally" but really. It is singular that the proof brought by Mr. H. (p. 145, et seq.) that the real produce of the taxes

would not fall off is drawn from the admission, that ONLY the Assessed Taxes, the Stamps, and the Property Tax would be affected!!! These three items make up near half of the public

révenue.

We now proceed, in conclusion, to fulfil our promise of laying before the reader a few remarks in confirmation of our opinion, that nothing but the necessity of the case can justify the protracted existence of a currency consisting entirely (or nearly so) of paper.

Admitting, what our experience of the stagnation of commerce in all former wars demonstrates, that in a state of harassing and expensive foreign hostility, no expedient but a paper currency could possibly bestow upon us the same facilities of internal industry and circulation, which we have now the happiness to enjoy; there are three considerations of more or less weight that deserve to be stated as tending to counterbalance this advantage.

1. It has been said that our reputation for unimpeached public credit among foreigners will soon sink very low, if they observe our prices continuing to rise, and our currency exclusively of paper. The effects which have universally followed the combination of these two circumstances on the continent, (where paper currency, by resting on the authority of the government and not on solid capital, is, strictly speaking, paper money,) will, it is said, produce this sensation, and its natural consequence, distrust in the permanence of our commercial and political integrity. Without asserting that this objection is entirely without weight, we are, nevertheless, not disposed to attach to it any very great importance, at least at the present moment. Our paper currency being the representative of real commodities, and not forced into circulation by any edict of the state, is known to rest upon a more solid foundation than that of the continental states. And so long as the property of a foreigner continues to enjoy, in point of fact, the same comparative degree of exclusive and perfect security, which is now the case in England, we are persuaded that no speculative fears will induce him to withdraw it from our protection. To make this objection valid, therefore, it is necessary to shew that public credit at home is liable to be endangered by an unrestrained progress in our present career; and here we are sorry to admit that we feel some apprehensions. We cannot shut our eyes to the force of the following ob

servations.

2. It is stated (Mr. H. p. 151.) "That the difficulties incident

to the state of things in 1797 were confined to a stagnation of sales, and to an interruption of credit in all the larger transactions of trade and of the community; but they were not felt in the exchange and distribution of commodities, in the common dealings by which the daily wants of the society are supplied. But what would be the result of any general interruption of confidence in paper currency at the present moment, when “ it is the foundation of every minute transaction in the interchange of common necessaries?" It would certainly create the greatest degree of confusion and distress, and probably the most terrible and fatal disorders. It is therefore very important to secure for the future the confidence that has hitherto prevailed; and the necessary absence of gold specie, as the standard to which the value of paper may be referred, seems to render extraordinary precaution the more necessary. The acknowledged integrity and moderation, and the fair intentions of the parties issuing bank paper, however they may triumph for a time, although opposite to their supposed interests, do not constitute (when we are contemplating a long period of time) a sufficiently secure basis for the prosperity, perhaps the existence, of the nation to rest upon. People will certainly feel this, nor will any conviction of past prudence and correct practice, or of the advantages_that have accrued under their influence, be enough to controul the doubts and fears of a possible departure from those principles, where the power of such departure evidently exists. Impressed with these ideas of security for the future, we do not hesitate to affirm, that it appears very inexpedient, that any set of men should possess uncontrouled the power of regulating at their discretion so important a state concern as the amount of the circulating medium; admitting, as we do, that it is their clear well understood interest to keep it within due bounds. Much less should such individuals, as country bankers may be supposed to be, (without intending any disrepect to them in their vocation) have the power of issuing currency without a public acknowledgment of the security upon which it rests.

8. There is another evil which has often struck our minds, as one of some moral and political magnitude, viz. the overgrown and still increasing size of the metropolis; one of the effects, we think, of the great facility given by paper currency to credit and circulation. When we see collected into one focus more than a tenth part of the population of the whole kingdom, a proportion full four times greater than that of any other metropolis in Europe*, even Paris not containing the fortieth part of

We of course mean to include only the large states, whose solid prosperity is derived from the produce of an extensive territory.

the population of France;-When we reflect on the perseverance with which a long course of neglect has suffered the religion of this immense mass to be corrupted, and its morals vitiated ;-on the facility which this permanent existence of a mob affords to any designing demagogue of disturbing the public tranquillity by flattering its vices and perverting its judgment ;-on the undue influence which is thus acquired for the heated and absurd opinions of the most ignorant and corrupted portion of the people, over the cooler and more sober judgments of those who are further removed from the vortex ;-when we reflect upon these and many other considerations, which press upon the mind, but which our already too much extended limits will not permit us to enlarge upon, we cannot but deprecate most earnestly the further growth of this enormous capital; particularly as we know that large additions are projected beyond those which are now only in progress towards completion.

We are aware, that in the advanced state of society in which we live, a great proportion of the people must reside in towns; and so far from regarding this necessity as an evil, we are convinced that it is an ordination of providence for the wisest purposes. It is one of the effects of the constant care exhibited by providence in apportioning, by the spontaneous alteration in the habits of a people, their powers of increase in numbers, to the remaining powers which exist in their territory to supply them with food. We have no doubt but that this gracious care may be found to exert itself in various shapes, in exact proportion to the just wants of a people in every period of society, from the inhabitants of the South Seas, to the Christian who enjoys the blessings of Bri tish civilization; and that it is a fanciful theory to suppose, that the intervention of vice, misery, or involuntary abstinence from marriage among the lower orders, is necessary to keep down the numbers of an industrious people to the level of its subsistence. We shall hope for an opportunity of entering into a detailed discussion of this subject in a future number. In the mean time we cannot but express our wish that some portion of the immense addition to the numbers in the metropolis could be diverted to the provincial towns, particularly as it appears demonstrable, that the commerce and manufactures of some of them have suffered in proportion to the overgrown increase of London.

Upon the whole, although we do not think that conclusive reasóns can be shewn against a further moderate increase of paper currency, yet we do not hesitate to declare an opinion that, during the necessary suspension of cash-payments at the Bank, an efficient controul should be established by Parliament, both over the

VOL. 1. NO. I.