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Mr. VANSITTART, APRIL 8, 1818, PROPOSED THE
FOLLOWING PLAN OF FINANCE :
“ That Private Bankers, who had now a legal right to issue Notes for sums
under Five Pounds to the 1st of July next, should, after a certain time, be deprived of that right: and that on the expiration of the period in question, Notes for sums under the value of Five Pounds should be deemed illegal, and not allowed to circulate, except on the deposit of a sufficient Government security."
PLAN OF FINANCE.
It is so obvious, that the land, the mines, the houses, the manufactured and agricultural produce of the country, and the personal industry of the whole kingdom, are pledged to the public creditor, that the subject will hardly be assisted by the following quotation from Blackstone, Book I. Chap. 8:
“ The land, the trade, and the personal industry of the subjects, are
pawned for the security of the debt." After twenty years of uncertainty Mr. Vansittart thus promulgates a safe and wholesome currency; not a non-representative paper currency, but a representative circulation of the land, the mines, the houses, the manufactured and agricultural produce and personal industry of the whole kingdom!. This is the long-sought desideratum! Nations yet unborn may celebrate a discovery which attaches the conveniencies of gold and silver to a substance light as air, but which nevertheless is thus rendered, on philosophical principles, more precious than the diamond'or the sapphire.
The happy establishment we may now enjoy would authorise the application of those beautiful lines of the poet to Mr. Vansittart:
“ Thou, as a gallant bark, from Albion's coast,
Our late “ Pilot” merely weathered the storm of the French Revolution ---the calm of financial rest will only be enjoyed when
our system arrives at that perfection held out by Mr. Vansittart, in his speech on the 10th of April, 1818, when he observed :
İf, at the time when Funded Property was first introduced, a Paper Currency had been established on it-one might have possessed a Banking System as perfect as any tliing of this nature could be made."
But Englishmen are tardy in the application of new discoveries ; it is the force of capital alone that has led them to receive modern inventions ;-they dismissed the gas lights from the streets of the metropolis twenty years since, notwithstanding they are now reinstating them.
When paper is not the representative of real property, it is an outrage on the physical nature of things; but an Act of Parliament might as well be passed to prevent the use of machinery as to prevent paper, when it is the representative of real property, from being preferred to ponderous gold and silver. The genius of the money market has invented extraordinary facilities for the advancement of commerce, and the Chancellor of the Exchequer now recompenses the enterprise of Capel-Court, by presenting a circulating medium wide as the genius of the nation, and commensurate to its most extended requirements; it will be bounded only by the amount of the funded property, and can be used as the necessities of commerce and agriculture suggest.
The Bank of England bave proved, that they hold Government and other securities for a much greater amount than the whole of their issues ; that portion of bank notes which is issued for discounts, represents, as it were, the goods of the British merchant deposited in Threadneedle-Street ; and that portion which is issued on Government securities, represents the houses, agricultural and manufactured produce, the mives, the land, the canals, the trade, and personal industry of every British subject; and the army and navy exist for no other purpose than to preserve the distinctions of property.
No other qualification will be required of a country banker than the possession of national property corresponding to the amount of his issue. Miserable, indeed, will be the plea of inability to conform to a requisition, which proposes only a proof that a man can pay his promissory notes! The grantor has certainly a right to prescribe the terms on which he will concede certain advantages; and country bankers will soon be prohibited, by the existing laws, from issuing any more one and two pound notes.
The country at large has certainly a claim on the legislature to protect them against the abuse which a well-merited confidence in the provincial banks has universally inspired. Yet this general confidence should be protected; and when it is announced in Par
liament that a Cork Bank, which had issued 300,000l. worth of notes, will not make a dividend of one shilling in the pound, it is time to interpose between the depredator and the unsuspicious peasantry.
Although Mr. Vansittart proposed, that only Government securities should be deposited for country bankers' issues, yet the pleadings of the landed interest will assuredly succeed in gaining for them an admission to similar advantages :-as in the case of Government attachments, the property, in the first instance, is made amenable to the claims of the Crown; so, likewise, it will be enacted, that, in cases of the insolvency of provincial bankers, country notes must be first paid. The public register of estates for notes in circulation will be made a legal proof that all antecedent claims on that property have been satisfied.
The clamor of folly itself will be silenced, when it is informed, that a gentleman with only one thousand pounds Three per Cent. Consols. may, without an expensive licence, begin to issue a corresponding sum in One Pound Notes. The equivalent he will receive for these notes will enable him again to purchase Government securities, and, by a repetition of the same process, the funded property of the kingdom may, in a great measure, be rendered circulateable to the bearer.
What cause of alarm, therefore, bas the legislature in this enactment? With three hundred thousand funded proprietors, can it be doubted, that in this adventurous age, numbers of them will embrace the opportunity of thus making double interest of their money ? For, let it be remembered, that the Three per Cent. Consols. will duly revder their interest to the country bankers, although the stock is " subjected” to the claims of country notes.
The Chancellor of the Exchequer, instead of endeavouring to disturb the confidence now so justly placed in our present provincial banks, will rather advance their prosperity; their establishments being already on foot, they will be prepared instantly to commence deposit issues, which, it has been shown, will only take 10001. Consols. to commence; and a most liberal time will be allowed for their gradually withdrawing their present issues.
But it may be answered—Such continual purchases of Government securities would take place by the adoption of this measure, that the Three per Cent. Consols. could not be purchased under 100l. ; for no one would be willing to sell their stock when the possession of it was attended with such extraordinary advantages.-Granted; but this difficulty to procure Government securities exhibits the most brilliant proofs of the advantages of the plan! As we therefore advance, the importance of the measure is more clearly proved; for the immediate reduction of the Three and a half, Four,