oat-meal, biscuit, rice, &c. are likewise daily announcing the arrival of cargoes of wheat and oats in the ports of London, Liverpool, and Glasgow, from this very Ireland whose population is perishing with hunger, from the very counties, even, in which the famine rages? Is over-production the cause of distress there as well as here! No: the articles of subsistence are exported from that wretched country because there are no means of purchase to those who stand in need of it. In a very recent debate in the House of Commons, Mr. Western stated "that he had received many letters from Ireland, all of which concurred that in the distressed districts there was a want of employment, a want of money, but not a want of food. . . . The fact was, that the farmers of Ireland having no money could not employ the poor, and that the poor having no employment could not buy food. Thus are

...

human beings starving with the cup of plenty close to their lips." This statement was confirmed by Mr. Ricardo in his reply: "the Misery of Ireland," says he, "might be traced to the system pursued in that country to the depreciated food which the population consented to take; where the food of the population was so low as that of potatoes, on the failure of the crop, the people were exposed to the pressure of want, because the main source of their subsistence was no more, and the low rate of their wages would not enable them to pur chase grain." (Debate, July 10.)

Mr. Ricardo admits in his pamphlet that wages rise in consequence of taxes paid by the laboring classes: but he denies' the inference that high wages tend to augment the price of those commodities on which labor is bestowed, and to give an advantage to foreign competitors. He contends that the farmer is placed under no comparative disadvantage in conse quence of an increase of wages; and therefore that, if it be necessary that corn should rise in order to remunerate the growers, it is also necessary that cloth, hats, shoes, and every other commodity should rise, in order to remunerate the producers of those articles. We are disposed to extract, from the very able pamphlet of Mr. Turner, his remarks on this question, for it is of the utmost importance that the nature of taxation should be examined in all its bearings:

Now, let us examine closely into the arguments here made use of, which go to shew, that high wages do not tend to increase the price of corn, nor prevent the English farmer from competing with the foreign grower. Let us suppose, that the annual produce of a farm which required the constant labour of ten men, produced annually 2,000 bushels of corn, and that the quantity of corn paid to such labourers, for the support of themselves and their families,

was

was at the rate of a bushel and a half each per week, or 78 bushels per annum, equal together to 780 bushels; let us suppose also that it was quite impossible the labourers and their families should, or could exist upon a smaller quantity; and that of the 780 bushels so received by these ten labourers, 390 bushels were consumed as food, and the remaining 390 bushels exchanged for hats, shoes, and clothes, the produce of the labour of ten working manufac turers, equal exactly to one-half of that portion of their industry left to them by their masters.

Now suppose a tax to be levied, which should take from the agricultural labourers, one tenth of what they received, equal to 78 bushels of corn, and from the manufacturing labourers onetenth of their portion of manufactures: then say that

Leaving only 312 bushels to be exchanged (supposing prices continue the same) not against one balf of the portion of ten manufacturers, but only against nine-tenths of that half. We have supposed, however, that one half of the labour of the manufacturers is absolutely necessary for the clothing, &c. of the agriculturists; and vice versa, that 390 bushels of corn are equally necessary for the support of the manufacturers. How then, can this tax be met but by an increased allowance both by the farmer and the master manufacturer to their respective labourers? Instead of 780 bushels of wheat per annum, the farmer must allow at least 858, and the master manufacturer must make à corresponding increased allowance in the number of shoes, hats, &c. &c., to his workmen, to allow them to supply the agricultural la bourers with the same portion of manufactured goods, and to pay their taxes. Now, suppose that the farmer in addition to his labourers, had to pay 400 bushels for rent, 200 bushels for tithe, and 200 bushels for agricultural instruments and repairs, &c.; then before any tax was laid say

2000 bushels.?

h

Leaving only for the maintenance of the farmer and his family 300 bushels instead of 420, equal to a tax upon him of 284 per cent. instead of 10 per cent. A similar effect might easily be shewn to be the consequence of a tax on the manufacturers, which would compel them to raise the price of labour. How then is it possible, that the farmer, or manufacturer could meet a property-tax of this kind, nominally of 10 per cent., but really, of 284, without an increase of price? and how is it possible, that an increase of price should take place without an increase in the circulating medium ??

Suppose, that in a country without taxes, the labour of ten men employed in agriculture, would produce 2,000 bushels of wheat, and that the same portion of labour would produce precisely the same quantity of wheat in a country taxed to the extent of 200 bushels. Now, supposing other charges to be the same in both countries, the farmer in the untaxed country would have a surplus of 200 bushels more than the farmer in the taxed country; and if the portion retained by the untaxed farmer was 500 bushels, in the taxed it would be only 300. In the untaxed country, therefore, 500 bushels remain as the surplus produce in the hands of the farmer from the labour of ten men; whereas a farmer in the taxed country, to get the command of 500 bushels, must employ the labour of sixteen men, and two-thirds of the labour of a seventeenth. By importing, therefore, into the taxed country, the labour of ten men, you would be able to purchase in such taxed country, the labour of 16%; and the only way in which the foreign, grower could be prevented from competing with the hometaxed grower, would be by laying a duty on importation, equal to that paid by the home grower. The principle is the same, whether applied to corn or manufactured goods.'

In acknowleging that the principle is the same, whether applied to corn or manufactured goods, the position of Mr. Ricardo is admitted that the farmer is placed under no comparative disadvantage: but his argument is completely rebutted as it regards our intercourse with foreign countries.

Mr. Turner was for several years in the direction of the Bank, and retired from it only a few months ago; and the two-fold object of his pamphlet, which well deserves the public attention, is to exculpate that establishment from the charges brought against it by Mr. Ricardo and "the bullionists," and to hold up to derision and contempt all the different measures which have been proposed, some adopted, some abandoned, by his Majesty's ministers for the relief of the country, save and except one, namely the reduction of the 5 per cents. As to Mr. Peel's bill, which has created so strong a sensation throughout the country, we were somewhat surprized to hear Mr. Turner call it a complete 'dead letter.' With regard to its effect on the Bank of England, it has neither accelerated

nor

nor retarded the return to cash payments,' he says, except as by ordering the repayment of ten millions of Exchequer bills to the Bank, it enabled it to expend those ten millions in the purchase of bullion, without in any way curtailing its advances.' Does Mr. Turner mean to intimate that the Bank would ever have returned to cash-payments, if it had not been compelled to do so? Would it ever have purchased ten millions of bullion, while it remained exonerated from the necessity of cash payments? Mr. T. attributes the present distresses of the country to Mr. Peel's Bill, inasmuch as it has tended to aggravate the weight of taxation by reducing the price of commodities; but, if it has been a dead letter relatively to the Bank of England, an opinion to which we cannot accede, in what way has it tended to produce the present agricultural distress? How has it aggravated the weight of taxation? How has it produced low prices, except by effecting a contraction of the issues? Mr. T. answers, by having spread alarm from one end of the country to the other: by having put a stop to that regular system of credit which had existed for years between the yeomanry and tenantry of the country, and their country-bankers.' We must again

withhold our assent: there was no general alarm at the first passing of the bill: on the contrary, it instilled a premature confidence between man and man: the expected return to a sound currency was the subject of general gratulation; and it is notorious that the extent of its operation and the magnitude of its effects were very inadequately estimated, either by its supporters or its opposers in or out of Parliament, except, perhaps, by Mr. Turner himself. They have been fully appreciated only since they have been practically felt. The general low price of commodities arises either from a diminished amount of currency, or, which is equivalent, from its more sluggish circulation.

It is detailed in evidence before the Bullion Committee, that about 200,000l. is sufficient to effectuate the exchange of drafts amongst the different bankers of London, at the clearing-house daily, to the extent of 4,700,000l. Now, it must be quite clear, that if any given number of bankers were from any circumstances out of credit with their brethren, so that drafts upon them would not be received at the clearing-house, then it must require a larger sumrin current coin or bank notes than 200,000l., in order to settle and adjust the above quoted daily payments to the extent of 4,700,000l. The multiplying power would be checked, and the same sum of money could not effectuate the same objects. An effect similar to this has taken place in the country, in consequence of Mr. Peel's bill, and has carried distress into every district. Ap country bank was a kind of clearing-house, where, without any

actual

actual interchange of notes or money, the greater part of all payments between man and man was effectuated by mere transfers in the books of their bankers. The tenant had credit with the Bank, and paid his rent by a draft in favour of his landlord, which draft was paid by the landlord to his banker, and he again (the landlord,) paid his different tradesmen by fresh drafts, which drafts were again lodged by such tradesmen with the bankers, so that the whole was adjusted by mere book transfers between A, B, C, and D. It was merely the smaller payments for wages and weekly bills which required notes.'

Mr. Turner says (p. 48.) that the only danger of an excess [of currency] proceeds from too great advances to the Government, whereby the Bank loses its control over its issues, in consequence of repayment not taking place at short periods. Then and then only is it possible for a larger quantity of notes to be kept in circulation than the necessities of the country require.' This remark would be sound if its application were confined to country-bankers, because they have always been obliged to pay their own promissory notes either in cash or in notes of the Bank of England: the circulation of a country-banker's notes depended entirely on his credit: but the Bank of England had no such check on its issues during the suspension of cash-payments, the circulation of its notes being secured to it at all events, because the acceptance of them was compulsory. They were issued exclusively in payment of the public dividends, and they were received as equivalent to cash in all payments into the ExcheWhen Parliament removed from the Bank of England quer. that salutary check which restrained the issues of countrybanks, its paper was at par with gold, and so continued till the year 1801, when it was at a discount of nearly 8 per When the Bank increased its issues, which had before averaged 17 millions, to 19 millions in the year 1809, and in 1810 to 22 millions, the discount rose in proportion: in the latter of these years, it was 137. 9s. 6d. per cent.: in 1812, bank-notes were at an average discount of 20 per cent., and in 1814 of 25 per cent. How can Mr. Turner assert, then, that it is impossible for the Bank to keep in circulation a larger quantity of notes than the country requires, unless its advances are too great to Government? Its advances, during the period mentioned, were undoubtedly much too great, but it was from the very circumstance of the restriction that they were Mr. Peel's Bill has removed that restriction: the circulating medium of the country is reduced; and had a corresponding reduction of the national expenditure accompanied its enactment, we should have felt nothing of the distress which now assails us.

cent.

So.

Much