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and his determination to difcharge part of their advances from funds which, not he, but Parliament, had deftined for other fervice. Upon thefe different points he fhould not have dwelt fo long, if he had been quite fure that Gentlemen had read the Reports of the Committee; but he now came to that period when a new Loan was made, the main object of which was the payment of the advances made by the Bank. The reafon then affigned for this measure was that it would relieve circulation, and enable the Bank to enlarge their accommodation to commerce. He knew it was not regular to refer to thofe documents, printed as debates of the House, because they were not confidered as authentic, and were even contrary to the orders of the Houfe; but if thefe debates were at all correct, it was upon a Budget, and if Gentlemen would look at the fpeech of the Right Honourable Gentleman, they would find that it confirmed the account which he here gave of it, but could not regularly quote. From the evidence of Mr. Bofanquet it appeared, that part of the fums, for payment of which this Money was granted, had not been paid off. Some thing like altercation had taken place on this fubject on a former night, and it was contended that this was owing to the Bank not having availed themfelves of the option in the act of fubfcribing their Exchequer Bills in payment of their fhare. But in fact the Honourable Gentleman who defended the Chancellor of the Exchequer upon that claufe, might as well have quoted any Loan Bill that had been paffed this century. The Bank were Creditors fuing for the payment of a debt due to them, and they did not wish to convert a floating debt into a permanent one. He was aftonished when he heard it faid that the Bank, who had fo long and fo earneftly folicited Government for payment of their advances, did not avail themselves of the means of payment. To fuch an affertion he fhould repeat---believe it who can. The evidence of Mr. Raikes, Mr. Giles, Mr. Bofanquet, and every other Director examined, proved that they had preffed for payment of the very fum which he complained of as left undischarged; that the claufe in the Loan Bill which had been quoted, had nothing to do with the subject, and that the folicitations of the Bank for payment of it still conti

nues.

Having traced the Chancellor of the Exchequer ftill promifing payment of former advances, and ftill extorting money, as he would call it, from the Bank upon fresh pretences, three Budgets having elapsed without provision being made, the Bank had an interview with the Chancellor of the Exchequer upon the 24th of May, 1796, and found him impreffed with the juftice of their applications. On the 25th of May, he wrote them that, after the second payment on the Loan of feven millions,

their demands fhould be attended to, but that he was obliged to go and attend the election at Cambridge, but fhould pay atten tion to their application on his return. On his return from Cambridge the Bank waited on him. Their advances were now as high as before, and they were urgent in their demands for payment. The Chancellor of the Exchequer affured them that fomething fhould be done, and coincided in opinion that the amount of their advances ought to be kept down; but as the anxiety which the Chancellor of the Exchequer expreffed for keeping down this amount was uniformly followed by a fresh demand, this was immediately fucceeded by an earnest request of new accommodation. The Bank remonstrate, and comply with reluctance, and, as they exprefs in their Memorial, from a fear that their refufal would be attended with a greater evil. If any thing can excufe the Bank for continuing their advances after the difappointments they had experienced, it must be the importunity with which they were preffed, and the dexterity with which they were always alarmed with the dread of injuring the fervice by their refufal. The fituation of the Bank became ftill more critical. Though there had been no direct communication refpecting their fituation, the Chancellor of the Exchequer had received fuch hints as must have fufficiently apprised him of the fituation in which it ftood. Still their folicitations were neglected, his promifes were broken, and the fum of their advances continued to increase till the fatal period when the Order of Council was iflued. Amidst all the reprefentations which he had received from the Bank, regardless of the confequences which threatened to follow the fyftem he purfued, the Chancellor of the Exchequer, far from labouring to avert the ruin, continued to perfevere in the very meafures which accelerated its completion and aggravated its mifchief.

With regard to the effects of the drain occafioned by the Im perial Loan, the evidence upon the table was full of the remontrances made by the Bank to the Chancellor of the Exchequer. On the 16th February, 1796, they reprefented that a further perfeverance in foreign remittances would be fatal to the Bank. The Chancellor of the Exchequer aflured them that no Loan fhould be fent to the Emperor, unless circumftances materially altered. With this the Bank were fatisfied, because they un derstood the affurance to extend to remittances of every kind. The reprefentation to which this anfwer was made compre hended both Loan and advances, and Mr. Bofanquet fays, in his evidence, that the anfwer of the Chancellor of the Exchequer was difingenuous if it did not apply to both. If what paffed at the converfation which took place on this fubject was admitted, it was difgraceful in the Chancellor of the Exchequer to return

fo

fo deceitful an answer. It was understood to apply to every kind of remittance, and if it was not fo meant, it was not only difingenuous but fraudulent. What was the fact, however? Colonel Crauford had, at this very time, drawn Bills to the amount of 300,000l. and continued to draw, till the fum of advances was 1,300,000l. till the drain upon the Bank was fo great, that the run which it afterwards experienced, and which it otherwife might have been able to fuftain, became fatal; but if good faith be neceffary to public dealings, will the House of Commons allow fuch flagrant breach of it to pafs with impunity? Public credit has been impaired! The Bank has been forced to ftop payment! Thefe are now but the crimes of an individual. If they receive the countenance and protection of the House, they communicate the guilt to the Reprefentatives of the People, and become the character of the nation. But even if no fuch catastrophe as the stoppage of the Bank had taken place, ftill the conduct of the Chancellor of the Exchequer ought not to pass unnoticed. It may be faid it is unfair to reafon from what has happened; but independently of what has happened, the conduct which led to it was criminal. If, when the meafures of the Minifter materially contributed to that fatal event which public credit has felt fo deeply, fhall not the House rescue itself from the charge of being his accomplices, by punishing the perfon to whom the guilt must be afcribed? That it did contribute, and moft materially to that event, he would ftill contend. All the Directors of the Bank examined upon the fubject, Mr. Raikes, Mr. Giles, &c. agreed in ftating, that if the advances by the Bank to Government had been difcharged, the stoppage of the Bank night have been prevented. Mr. Giles and Mr. Bofanquet were very explicit in their opinion, as well to this point, as Mr. Winthrop and others. Mr. Thornton and Mr. Boyd, however, had, in their fpeculative ideas, expreffed an opinion, that the conduct of the Bank, with regard to discounts, had contributed to the ftoppage. In the fpeculative principles which the latter Gentleman threw out upon this head, he was happy to find that he had made a distinction between the conduct to be followed by the Bank of England, and by other Banks, because as this Honourable Gentleman was himself connected with a Bank, he had thus obviated the want of confidence which muft naturally have arifen towards a Bank managed upon the principles he had laid down. Indeed, he feemed to have confounded every fober and rational principle of Banking. The Bank of England was a Bank of circulation. To the fupport of fuch a character, it was effential that it fhould pay on demand. It therefore ought to be always prepared. If neceffary, it must have cash to answer all its notes.--8 L

No. 37.

It

1360 PARLIAMENTARY CHRONICLE. [COMMONS. In times of calamity the Bank muft bear the burden with other fufferers. In profperous times it poffefied the means of recovering its loffes; in times of alarm it would be able to defeat its malignity by answering every demand. Circulating Medium was a fashionable phrafe in the prefent times, and he was afraid what was faid to be a want of Circulating Medium was a want of Capital. The ftate of the exports was no proof of the flourishing ftate of the country. War neceflarily created a demand for certain articles; the individual manufacturer was enriched, but the country received no return for what was fent abroad on this account. The national capital was not fupplied and recruited by fuch exports, they only enhanced ruin, while they seemed to indicate profperity. Here Mr. Grey read a quotation from Smith's Wealth of Nations, in fupport of this doctrine. It was the opinion of Mr. Thornton and Mr. Boyd that the Bank fhould have extended their difcounts, and increased their paper. If an opinion of the latter Honourable Gentleman was well founded, then had the Bank Committee greatly deceived the public in their firft Report. It was faid by this Honourable Gentleman that the fums difcounted by the Bank were not to be taken as debts of which they could compel payment, but that they ought, by fresh illues, ftill farther to accommodate the perfon who had bills in this fituation. If fo, could the fums which the Bank had discounted be taken as aflets? If a bill were brought for discount by perfons who would require fresh discount when it became due be confidered as a fair bill, he would appeal to Mr. Thornton whether fuch a bill would be taken? Such an opinion, however, was evidently erroneous, and to proceed upon fuch principles no Bank of circulation could ever exift. It was faid that increased commerce required increased discounts. Here again he fhould appeal to the authority of Adam Smith It had been faid that there was nothing new under the fun, but he really thought that the doctrines he had heard on this point were new, till he found that they were the old maxims of speculators and projectors. Here Mr. Grey read another paffage from Smith, which laid it down that discount was only fafe and proper where the perfor discounted what he would otherwife have been obliged to keep by him. Particular circumftances had prevented him from attending the Committee when the Report was drawn up, and this was the reason why he had now to obje& to a part of it, against which he had not entered his diffent in the Committee. It was ftated that the Bank, by not extending its discounts, had contributed to the ftoppage which had taken place; but the whole facts in evidence were repugnant to this conclufion. It appeared that, when the Bank narrowed their discounts, their cash increased, except where there were other drains. Neither

did

did he agree in opinion that the reduction of country Bank Notes was owing to the diminution of Bank of England Notes; for though the Notes of the Bank of England had at certain periods been diminished, the proportion of country Bank Notes had remained as before; but, in point of fact, the discounts of the Bank had not been narrowed fince they were firft contracted in 1793; the declaration of the Bank that they were to contract had never been acted upon. For his own part, were he a Director of the Bank, he should refufe to discount any bill to a holder of Exchequer Bills, and fhould tell him to carry them to market before he came to the Bank for accommodation. It was a dangerous pofition that the conduct of the Bank of England ought to be guided by principles different from thofe which regulated the conduct of other Banks.

It had been justly obferved by an Honourable Gentleman, (Mr. Wilberforce) that particular meafures could be of little confequence, and that the restoration of general credit was the great point to be accomplished. But what was his definition of general credit? General credit muft reft more upon the feelings of confidence than upon a demonstration of caules. It was an edifice reared by the hand of fimplicity, upon the basis of truth. Men might difcufs finely and talk fpecioufly, but to infpire general credit you must excite belief, not infpire admiration. To extract belief of things above the reach of human judgment was the highest effort of Divine Power. But this claim was confined to Revelation. Men might be fubmitted to power, but their confidence could not be compelled. A regard to fimplicity, truth, and good faith, an experience of punctuality in tranfactions of honefty, in the difcharge of obligations incurred, could alone infpire general credit. A Bank Note, Mr. Burke had well obferved, is all powerful upon the Royal Exchange, because in Weftminster Hall it is impotent. To talk of any new circulating medium which commerce did not fupply, was a dangerous chimera. To infpire general credit, you must tell the public that the Bank is to be conducted like other concerns, upon views of its own intereft; that it is to be conducted by men who act as merchants not as politicians and statelinen, and you will inspire general credit; tell the public that the connection of the Bank with Government is to be diffolved, that its tranfactions are to be free, and you will infpire general confidence. The Bank of England, if it begins its operations on the 24th of June, can only ftand upon the principles of truth and honefty, on fidelity in its engagements and paying its notes upon demand. Was it neceflary to refute the doctrine, that when embarraffed the Bank ought to have increased its iffue of paper to increase the means of enforcing demands for fpecie, without additional means for fatisfying the demand?

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