"Experience," says Dr Johnson, "is the great test of truth, and is perpetually contradicting the theories of men." "If an empire," said Napoleon, "were made of granite, it would soon be reduced to powder by political economists." Never was there a period when the truths stated by these master minds were so clearly and strikingly illustrated as the present; never was there an epoch when the necessity was so fearfully evinced of casting off the speculative dogmas of former times, and shaping our course by the broad light which experience has thrown on human transactions. If this is done, if wisdom is learnt by experience, and error expelled by suffering, it is yet possible to remedy the evils; though not before a frightful and yet unfelt amount of misery has been encountered by the people.

For the last thirty years, the liberal party have had the almost uncontrolled direction of the affairs of the nation. One by one, they have beat down all the ancient safeguards of British industry, and given effect to the whole theoretical doctrines of the political economists. So complete has been their ascendency in the national councils—so entire in general the acquiescence of the nation in their direction, that without one single exception ALL their doctrines have been carried into practice; and the year 1847 exhibits a fair, and it may be presumed average result of the liberal system when reduced into execution. The result is so curious, its lessons so pregnant with instruction, its warning of coming disaster so terrible, that we gladly avail ourselves of the opening of a new year, to portray them in a few paragraphs to our readers.

The first great change which took place in British policy was in 1819, by the famous Bank Restriction Act, passed in that year. Everyone knows that the obligation on the Bank of England to pay in specie, was suspended by Mr Pitt in February 1797; and that under that system the empire continued to rise with all the difficulties with which it was surrounded, until in the latter years of the war it bore without difficulty an annual expenditure of from £110,000,000 to £120,000,000 annually. But under the new system introduced in 1819, the currency was restricted by imposing on the bank the obligation of paying its notes, when presented, not in gold or silver, but in GOLD ALONE. The currency was based on the article in commerce most difficult to keep, most easy of transport, most ready to slip away—the most precious of the precious metals. The result has been that the nation,—which, with a population of 18,000,000 of souls, raised without difficulty £71,000,000 annually by taxes, and from £30,000,000 to £40,000,000 annually by loans in 1813, 1814, and 1815, of which at least a half was sent abroad, and wholly lost to the nation—is now, with a population of 28,000,000, not able to raise in round numbers above £51,000,000 on an average of years by taxation, and is brought to the verge of ruin by the purchase of £33,000,000 worth of foreign grain in 1846 and 1847, and the expenditure of £35,000,000 in 1846, and £25,000,000 in the first six months of 1847 on domestic railways, every shilling of which last sum was spent at home, and puts in motion industry within the nation.

The next great change was made in the year 1821, when the reciprocity system was introduced by Mr Huskisson. This subject has acquired great importance now, from the avowed intention on the part of government, scarcely disguised in the opening speech of this session of Parliament, to follow up the labours of the committee which made such laborious inquiries last session, by a bill for the total abolition of the Navigation Laws. We shall not enlarge on this subject, the vastness and importance of which would require a separate paper. Suffice it to say, therefore, that here too, experience has decisively warned us of the pernicious tendency of the path on which we have entered, and of the truth of Adam Smith's remark, that "though some of the regulations of this famous act may have proceeded from national animosity, they are all as wise as if dictated by the most deliberate wisdom. As defence is of much more importance than opulence, the act of Navigation is perhaps the wisest of all the commercial regulations of England."[1] It appears from the parliamentary tables compiled by Mr Porter, that, while the British tonnage with the Baltic powers had increased from 1801 to 1821, under the protective system, to a very considerable degree, theirs with us had declined during the same period; under the reciprocity system, our tonnage with them had on the whole decreased to a third of its former amount, while their shipping with us had, during the same period, quadrupled.[2] It further appears, from the same tables, that the great increase which has taken place during the same period, has arisen from the prodigious growth of our colonial trade, or increase of the countries with whom we had concluded no reciprocity treaties, but left them on the footing of the protection of the old Navigation Laws. And though the profits of shipping of all sorts have received a vast addition, from the enormous importations consequent upon Sir R. Peel's free-trade measures, yet the returns of these years prove that the greater part of this increase has accrued to foreign states and powers, which may at any time turn the maritime resources thus acquired against ourselves. Suffice it to say, as an example of this truth, that of the ships which, in 1846, imported four million nine hundred thousand quarters of corn into the British harbours, no less than three-fourths were foreign vessels, and only one-fourth British. Nevertheless, so insensible are political fanatics to the most decisive facts, when they militate against their favourite theories, that it is in the full knowledge of these facts that government are understood to be prepared to introduce, even in this session of parliament, a measure for the abolition, or at least the essential abrogation, of the Navigation Laws.

The third great change made during the last quarter of a century has been in the government of Ireland. Here, if any where, the liberal system has received its full development, and has had the fairest opportunity for displaying its unmixed blessings. The Catholic disabilities, which we had been told for thirty years were the main cause of its distressed condition, were repealed in 1829. A large measure of parliamentary reform—larger than the most vehement Irish patriots ventured to dream of—was conceded in 1832. Corporate reform succeeded in 1834; the Protestant corporations were dispossessed of power; the entire management of all the boroughs of the kingdom was put into the hands of the Romish multitude; and a large portion of the county magistracy were, by the appointment of successive liberal Lords Chancellor, drawn from the better part of those of the same religious persuasion. The Protestant clergy were deprived of a fourth of their incomes to appease the Romish Cerberus; and, to avoid the vexation of collecting tithes from persons of a different religious belief, they were laid directly as a burden on the land; Maynooth was supported by annual grants from government; the system of national education was modified so as to please the Roman Catholic clergy. Monster meetings, where sedition was always, treason often, spoken, headed by O'Connell, were allowed to go on, without the slightest opposition, for two years; and when at length the evil had risen to such a height that it could no longer be endured, the leading agitator, after being convicted in Ireland, was liberated, in opposition to the opinion of a great majority of the twelve judges, by the casting-vote in the House of Peers of a Whig law-Lord. British liberality, when the season of distress came, was extended to the famishing Irish with unheard-of munificence; and while the Highlanders, who suffered equally under the potato failure, got nothing but from the never-failing kindness of British charity, Ireland, besides its full share of that charity, received a national grant of TEN MILLIONS STERLING, of which no less than eight millions were borrowed by Great Britain.

What have been the results? Has crime decreased, and industry improved, and civilisation advanced, under the liberal system? Has attachment to the British government become universal, and hatred of the stranger worn out, in consequence of the leniency with which they have been treated, and the unparalleled generosity with which their wants have been supplied? The facts are notoriously and painfully the reverse. Hatred of the Saxon was never so general or so vehement; idleness and recklessness were never so wide-spread; destitution was never so universal; life and property was never so insecure,—as after this long system of concession, and these unparalleled acts of private and public generosity. The Irish Repealers declare, that though Ireland, like England, has been blessed with an uncommonly fine harvest, there are four millions of persons in that country in a state of hopeless misery; and supposing, as is probably the case, that this statement is exaggerated, the authentic reports to Parliament on the state of the poor prove that there are above two millions of paupers, or a full fourth of the population, in a state verging on starvation. A new so-called Coercion Bill has been brought into Parliament in consequence of the great increase of crimes of violence, and, above all, of cold-blooded murders; and on the necessity that existed for its introduction the present Secretary of State must speak for himself. Sir George Grey said, on November 30, 1847, on moving the first reading of the Coercion Bill, that during the six months ending October 1846, the heinous crimes of violence over Ireland stood as follows:—

For the six months ending October 1847, the number increased to—

It would thus be seen that there was a fearful increase in the amount of these four classes of crime. The whole of Ireland was implicated in the shame and disgrace consequent upon this large increase of crime. Looking at the police returns for the month of October, (for from that period it was that those crimes commenced to increase at such a fearful rate,) he found the following results for the whole of Ireland:—

Looking at the districts in which these crimes were committed, he found that the total number of all those crimes committed in three of the counties of Ireland, i.e., Clare, Limerick, and Tipperary, was to the whole of Ireland as 139 to 175, or that 71 per cent of the whole amount of crime was committed in those three counties, which did not include more than 13 per cent of all Ireland."

Such has been the result of liberal government during twenty years in Ireland. And it is particularly worthy of notice, that the three counties in which this unenviable pre-eminence of atrocious crime exists, viz., Clare, Limerick, and Tipperary, are precisely those in which the Romish faith is most inveterate, and the authority of the priesthood most unbounded.

The next great change introduced by the liberal party, was by the carrying through of the Reform Bill, and settling the constitution upon an entirely new basis by the act of 1832. We do not propose at present to resume any part of that great debate, in which at the time this Magazine took so prominent a part. We have seen no cause to change any of the opinions then expressed, and only pray God that the predictions then made may not be too faithfully verified. As little shall we inquire whether the changes which have since ensued, and under which the nation is now so grievously labouring, are or are not to be ascribed to the constitution of government as then framed, and the urban ascendency which the bestowing of two-thirds of the seats in the House of Commons upon towns necessarily occasioned; we are content to accept the constitution, as new-modelled by the Reform Bill, as the constitution of ourselves and our children, and to support it as such. We know that by it the government of the country is substantially vested in the majority of eight hundred thousand electors. We aim only at explaining facts and dispelling illusions to these electors. Suffice it to say, therefore, that, whether the Reform Bill has worked for good or for evil as regards the industrious classes; whether it has substituted or not substituted moneyed for landed ascendency; whether or not the first devil has been expelled, but straightway he has returned with seven other devils worse than himself, and the last state of the man is worse than the first—in any of these cases the liberal party have got nothing to say, and have no title to complain of the results which have followed. They got every thing their own way; they remodelled the constitution according to the devices of their own hearts, and if they are now suffering, they are reaping the fruits of the seed which they themselves have sown.

But of all the innovations of the liberal party, that of which the consequences have been most disastrous within the sphere of their immediate influence, and which have now been demonstrated in the most decisive way by the results of experience, are the changes they have made on our West India colonies. They exhibit a series of alterations so perilous, so irrational, so disastrous, that we do not hesitate to say they are unparalleled in the annals, extensive as they are, of human folly and perversity. Only think what they were!

We first, in 1807, abolished the slave trade in our dominions. So far there can be no doubt that the step taken was both just and expedient—just, because the iniquitous traffic in human flesh should, at all hazards, be stopped in a Christian state; expedient, because we already possessed, in the colonies themselves, a large negro population, perfectly capable, if well treated, of keeping up and increasing their own numbers, and performing all the field operations requisite for the cultivation of produce, which at that period employed two hundred and fifty thousand tons of British shipping for its transport, and maintained a population that consumed £3,500,000 worth of British manufactures. But as the British colonies were thus deprived of the aid of imported forced labour, which the rival sugar colonies of Cuba and the Brazils enjoyed, of course it was indispensable that the labour of the black cultivators in the British islands should be perpetuated, and the proprietors maintained in the means of getting that work from them which they were prohibited from acquiring from foreign labourers. The way to do this, and withal to give the greatest possible security and means of improvement to the black population of which they were susceptible, was evident, and was clearly and forcibly pointed out at the time. It was to maintain slavery in the meantime, doing every thing possible to mitigate its severity, till the negro population had come so much under the influence of artificial wants as to be ready, for their enjoyment, to submit to regular and continuous toil; to regulate their days of forced labour, and give them some days in the week to work for themselves, of which they might reap the fruits; and to allow every negro, who could thus amass a sum equal to his price, to purchase his freedom from his master. By this simple system, no one could become free without having proved himself fit to be a freeman, and therefore the whole evils of premature emancipation were avoided. It was thus that slavery wore out almost without being noticed in the European kingdoms; it was thus it almost disappeared, insensibly and without a convulsion, in Spanish South America.

Instead of this wise, judicious, and really humane course, what have we done? Why, we first, by the act of 1834, abolished slavery altogether in the British dominions, upon giving a compensation to the proprietors, which, large as it was, was not, on an average, the fourth part of the value of the slave population set free, at the expiration of a prospective apprenticeship of seven years; and at the end of four years, deeming that first time too long, we set them free altogether! We thought, in our wisdom, that a nation required no longer time to serve the apprenticeship to freedom than a freeman did to become expert in a trade. We proposed to do in a few years what nature could only accomplish in centuries. The consequences, so often and so fatally predicted, immediately ensued. The emancipated black population either refused to work, or did so at such high wages, and in so desultory a manner, that the supply of sugar rapidly declined in the British islands. It, in consequence, rose considerably in price in the mother country; and upon that, partly under the influence of the free trade mania, partly from a desire to appease the clamorous multitude in the British towns, who had begun to feel, in the enhanced price of that article, the inevitable consequences of their own actions, we did a thing so unjust, so monstrous, so cruel, so inconsistent with all our former professions, that we believe the annals of the world may be searched in vain for its parallel. It was this:—

We first reduced to a half of its former amount the protective duty on foreign slave-grown sugar, and then, by the act of 1846, in pursuance of Sir R. Peel's principles, and with his approbation, passed an act for the progressive reduction, during three years, of the duties on foreign sugar, until, in 1849, those on foreign and colonial were to become equal to each other! That is, having first deprived our own colonies of their slave labour for less than a fourth of its value, we proceeded to admit foreign sugar RAISED BY SLAVES to the supply of the British markets, on terms which in two years will be those of perfect equality. We have seen what came of the attempt in the Mauritius, to compete with slave-labour by means of the labour of freemen. Even though the attempt was made under the most favourable auspices, with the colossal capital of Reid, Irving, and Company, and an ample supply of hill coolies to carry it on, the immense wealth of that house was swallowed up in the hopeless attempt, and it became bankrupt in consequence. Experience had long ago proved in St Domingo that the black population, when not compelled, will not raise sugar; for that noble island, which, anterior to the emancipation of its slaves by the Constituent Assembly of France, raised and exported 672,000,000 pounds of sugar, now does not export a single pound; and instead of consuming as then £9,890,000 worth of French manufactures, does not import a single article.[3] To provide against this evidently approaching crisis in the supply of sugar for the British market, we have thrown open our harbours to slave-grown sugar from every quarter of the globe; and from the rapid decline in the produce of the West Indian islands, even before this last coup-de-grace was given them by the application of free trade, principles to their produce, it is painfully evident that a result precisely similar is about to take place in the British colonies.[4] And it is little consolation to find that this injustice has recoiled upon the heads of the nation which perpetrated it, and that the decline in the consumption of British manufactures by the West India islands is becoming proportioned to the ruin we have inflicted on them.[5]

But most of all has this concatenation of fanaticism, infatuation, and injustice proved pernicious to the negro race, for whose benefit the changes were all undertaken. Happy would it have been for them if the British slave trade had never been abolished; that they had crossed the Atlantic chiefly in Liverpool or Glasgow slave-ships, and been brought to the British West India islands! For then the slave trade was subject to our direction, and regulations might have been adopted to place it on the best possible footing for its unhappy victims. But now we have thrown it entirely into the hands of the Spaniards and Portuguese, over whom we have no sort of control, and who exercise it in so frightful a manner that the heart absolutely sickens at the thought of the amount of human suffering, at the cost of which we have reduced the price of sugar to sixpence a pound. Compared with it, the English slave-ships and English slavery were an earthly paradise. Mr Buxton, the great anti-slavery advocate, admitted, some years ago, that the "number of blacks who now annually cross the Atlantic, is double what it was when Wilberforce and Clarkson first began their benevolent labours."[6] Now, under the fostering influence of free trade in sugar, it may reasonably be expected that in a few years the whole, or nearly the whole sugar consumed by Europe, will be raised by the slave colonies, and wrung by the lash from the most wretched species of slaves—those of Cuba and Brazil! Moreover, the slave trade, to supply them, will be triple what it was in 1789, when the movement in favour of the negro population began! Thus, by the combined effects of fanaticism, ignorance, presumption, and free trade, we shall have succeeded, by the middle of this century, in totally destroying our own sugar colonies; adding, to no purpose, twenty millions to our national debt; annihilating property to the amount of £130,000,000 in our own dominions; doubling the produce of foreign slave possessions; cutting off a market of £3,500,000 a-year for our manufactures: and tripling the slave trade in extent, and quadrupling it in horror, throughout the globe.

Grave and serious matter for consideration as these results afford, all of which, be it observed, are now ascertained by experience—they yet sink into comparative insignificance compared with the gigantic measures of "free trade and a fettered currency," which have now spread ruin and desolation through the heart of the empire. It is here that the evil now pressing is to be found; it is from hence that the cry of agony, which now resounds through the empire, has sprung. And unless a remedy is applied, and speedily applied, to the enormous evils which have arisen from the reckless and simultaneous adoption of these powerful engines on human affairs, it may safely be affirmed that the present distress will go on, with slight variations, from bad to worse, till the empire is destroyed, and three-fourths of its inhabitants are reduced to ruin. These are strong expressions, we know; but if they are so, it is from the testimony of the government, and the ablest advocates for the free trade and bullion system, and the facts which we see around us, that we are reluctantly compelled, not only to use them, but to believe they are true. Hear what the Times says, on the aspect of national monetary and commercial affairs:—

"In our wide sea of difficulties, therefore, we are without rudder or compass. We cannot base our proceedings on a calculation that the Bank Charter Act will be carried out; nor can we, on the other hand, assume that an inconvertible currency will be authorised, and thus frame our future contracts accordingly. All that we can discern before us is declining trade and grinding poverty, bankrupt railways, and increased taxation; but whether the lesson will be prolonged in its bitterness, and its salutary effect retarded by measures of national dishonour, is a point upon which it would be vain to prophesy. Three years back an indignant negative might have been given to such a conjecture, but since then demoralisation has been rapid, and time alone can determine if, by the deliberate proceedings of the legislature, the record of it is destined to become indelible."—Times, 26th November 1847.

This is tolerably strong evidence from the leading and ablest free trade and bullionist journal. Strong indeed must have been the testimony of facts around them, when the well-informed and powerful writers in the Times put forth such admissions as to the state of the country. Observe, the emphatic words wrung by woful experience from this journal. "Three years back an indignant negative would have been given to such conjectures; but SINCE THEN the progress of demoralisation has been rapid." Sir R. Peel's Bank Act was passed in 1844, and his free trade measures in 1846. And be it observed that that state arose entirely under their own system; at a time when the Bank charter stood unchanged, and free trade, the grand panacea for all evils, was, and had been in a great degree, for years, in full and unrestrained operation. We shall see anon whether the Irish famine and English railways had any thing material to do with the matter. Strong as it is, however, this testimony is increased by the real evidence of facts in every direction, and of the acts and admissions of government. These are of such a kind as a few years ago would have passed for fabulous. They have outstripped the most gloomy predictions of the most gloomy of the Protectionists; they have out-Heroded Herod in the demonstration of the perilous tendency of the path we have so long been pursuing. They could not have been credited, if not supported by the evidence of our own senses, and the statements of ministers of high character, from undoubted and authentic sources of information. We subjoin a few of them, of universal and painful notoriety to every inhabitant of the empire at this time; not in the belief that we, in so doing, can add any facts not previously familiar to the nation, but in order that these facts, now so well known, should get into a more durable record than the daily journals, and not pass for fabulous in future, and it is to be hoped, happier times.

The first is, that the interest of money has, by the recommendation, and indeed express injunction of government, been raised to eight percent. This grievous and most calamitous effect, which was never heard of during the darkest period of the Revolutionary war, which did not ensue even at the time of the Mutiny of the Nore, or the suspension of cash payments in 1797,[7] has been publicly announced to the nation, in the Premier's and Chancellor of the Exchequer's Letter to the Directors. It is well known that, high as this rate of interest was, it was less than had been previously taken by private bankers, which had risen to nine, ten, and even fourteen or fifteen per cent. for short periods. These are the rates of interest which, anterior to their conquest by the British government, were common amidst Asiatic oppression in the distracted realm of Hindostan. They had not been so high in England before for a century and a quarter. It was reserved for Great Britain, in the middle of the nineteenth century, to render universal, by the effects of domestic legislation, at the end of thirty years' peace, and when in a state of entire amity with all the world, a rate of interest unknown for a century before in the British empire; which could previously be hardly credited as having existed, even in the days of feudal barbarity; and which had latterly been known only amidst the predatory warfare, fierce devastations, and universal hoarding of specie, under the native powers of Hindostan.

In the next place, the public revenue for the quarter ending 1st October, 1847, is £1,500,000 less than it was in the corresponding quarter of the preceding year, which itself was below the corresponding quarter in 1845. Here then is an ascertained falling off of £1,500,000 a quarter, or Six Millions a-year, in a revenue not exceeding £52,000,000 of net income, and of which upwards of a half is absorbed in paying the dividends on the public debt. There is no reason to hope for an amendment in the next or the succeeding quarter; happy if there is not a still greater falling off. This is, be it observed, in the thirty-second year of peace, when in amity with all the world, and when the war income-tax, producing £5,200,000 a-year, is added to the national income! But for that grinding war-addition, laid on to meet the disasters of the Affghanistaun expedition, and kept on to conceal the deficiency of income produced by Sir R. Peel's free trade measures, the deficiency would be above £11,000,000 a-year. And this occurs just after a proper and suitable thanksgiving for an uncommonly fine harvest; when all the world is at peace; five years after Sir R. Peel's tariff in 1842, which was to add so much to our foreign trade; three years after the act of 1844, which was to impose the requisite checks on imprudent speculation; and eighteen months after the adoption of general free trade, and the abolition of the corn laws by the act of July 1846, by which the commerce and revenue of the country were to be so much improved!

In the third place, nearly the whole railways in progress in the United Kingdom have been stopped, or are to be in a few days, in consequence partly of this exorbitant rate of interest, partly of the impossibility of getting money even on these monstrous and hitherto unheard-of terms. It is calculated that three hundred thousand labourers, embracing with their families little short of a million of persons, have been from this cause suddenly thrown out of work, and deprived of bread. Already the effects of this grievous and sudden stoppage are apparent in the metropolis, Manchester, Liverpool, Glasgow, and other great cities, in the groups, at once pitiable and alarming, of rude and uncouth, but sturdy and formidable labourers, who are seen congregating at the corners of the principal streets. But if this is the effect of the sudden stoppage on the mere navigators, the hod and barrow-men, what must it be on the vast multitude of mechanics and iron workmen, thrown idle from the inability of the railway companies, at present, at least, to go on with their contracts? So dreadful has been the effects of this stoppage in Lanarkshire and Ayrshire, the two principal iron districts of Scotland, that before these pages issue from the press, forty thousand persons in the former county, and thirty thousand in the latter, including the families of the workmen, will be out of employment in the iron and coal trades alone! The greater part of this immense and destitute mass will fall on Glasgow, where already half the mills are stopped or on short time, and in which city, since the beginning of the year, no less than 49,993 Irish[8] have landed, nine-tenths of whom were in the last stage of destitution, and no inconsiderable part bringing with them the contagion of typhus fever.

In the fourth place, the great marts of manufacturing industry, both for the home and the export trade, are in nearly as deplorable a condition as the iron trade; and the multitude who will be out of bread in them is not less appalling than in the railway and iron departments. As a specimen of the condition to which they have been brought by the combined operation of free trade and a fettered currency, we subjoin the weekly return of the state of trade in Manchester for the week ending November 23. It is well known that this return is made up under the direction of the admirable police of that city, with the utmost accuracy.

Weekly return made up to yesterday, (November 23), in the improved form, of the state of the various cotton, silk, and worsted mills, and other large establishments and works in Manchester:—

Key:

• (a) Total No. of Mills, Works, &c.
• (b) No. working full time, with full complement of hands.
• (c) No. working full time with a portion only of hands employed.
• (d) Short Time.
• (e) Stopped.
• (f) Total No. of hands.
• (g) No. working full time.
• (h) No. working short time.
• (i) No. wholly out of employment.

From this Table it appears that out of 40,995 workers employed in the factories of Manchester, 11,284 are working short time, and no less than 9,389 are wholly out of employment. This last class, with their families, cannot embrace less, at the lowest computation, than thirty thousand souls, who are entirely destitute. The state of matters in Glasgow is at least as bad; about half of the mills there are shut, or working short time. And this is the condition of our manufactures, we repeat, in the thirty-second year of profound peace, when we are engaged in no foreign war whatever; when, so far from being distressed for the ordinary supply of subsistence, we have just returned thanks to heaven for the finest harvest reaped in the memory of man; and when, under the combined operation of home produce and an immense foreign importation, wheat is selling for 52s. the quarter; three years after the imposing of the golden fetters which were for ever to preclude improvident speculation; and a year and a half after the adoption of the free trade principles, which were to open up new and unheard-of sources of manufacturing prosperity.

In the fifth place, if the general state of our exports, and of the importation of the raw material, from which they are prepared, is considered, it will not appear surprising that the principal marts of manufacturing industry should be in so deplorable a situation. The declared value of the exports of our manufactures, for nine months, ending October 10, in each of the following years, have stood thus, according to Lord John Russell's statement:—

This decline is of itself sufficiently alarming, the more especially when coming in the wake of the great free trade change, from which so great an extension of our exports was predicted. Here is a decline of exports in two years of three millions, which in last October had swelled to a decrease of NEARLY A MILLION in a single month. But from the following Table it appears that this falling off, considerable as it is, exhibits but a small portion of the general decline of manufacturing industry in the nation; and that the stoppage of industry for the home market is much more serious.

Raw Material Imported, Jan. 5 to Oct. 10.

This Table exhibits an alarming decline in the importation of all the materials for our staple manufactures, except raw silk, which has considerably increased. That increase has not arisen from any increased sale of articles of clothing, viewed as a whole, in the nation since 1845, but solely from the great extent to which, since that time, the fashion of ladies' dress has run in favour of silk attire. And, accordingly, the decline in wool and cotton imported is so very considerable, that it amounts, since 1845, to fully a fourth. We are aware how much the price of cotton rose in 1845; but it has since rapidly declined; and yet, even at the present low prices, Lord George Bentinck stated in his place in the House of Commons, in the course of the debate on bringing up the address in this session of Parliament, without contradiction from the practical men there, that so miserable were the prices of export markets just now, that cotton manufactured goods were exported cheaper than the raw material from which they are formed could be imported to this country.

It is a poor set-off to these facts demonstrating the declining state of our foreign manufactures, to say that the exportation of iron and machinery has greatly increased during the same years, and that we have imported enormously all kinds of foreign subsistence.[10] So it has been; but what does that indicate? The first, that foreigners, under our liberal system of free trade, even in the articles vital to our manufacturing wealth, are largely importing the machinery which is to enable them to rival our staple manufacturing fabrics; and the iron rails which are to give them the means of bringing their establishments, for practical purposes, nearer each other, and compensating the immense advantages we have hitherto derived from the narrowness and compact nature of our territory, and our insular and highly favourable maritime situation. The last, which undoubtedly has risen in so short a time to a height which the most decided and gloomy Protectionist never ventured to anticipate,[11] only demonstrates that free trade is even more rapidly than was anticipated by its opponents, working out the downfal of our agricultural industry, and reducing us to the pitiable condition of the Roman empire, when, instead as of old sending supplies of provisions to the legions from Italy into distant provinces, they were entirely fed by them, and the life of the Roman people was committed to the chances of the winds and the waves.

In the sixth place, the depreciation of property and ruin to individuals which has ensued and is going on from the present crisis, is so prodigious, that the mind can scarcely apprehend it, even by the aid of the most ardent imagination. Not to mention the extreme embarrassment to merchants which must ensue from the present extravagant rate of interest and discount, and which must in most branches of commerce entirely absorb the profits of stock for this year—not to mention the vast number of the most respectable houses which have sunk under the pressure of the times—not to mention the prodigious burden imposed on landed proprietors and debtors in mortgages and bonds on personal security, by the general rise of interest to five per cent. and often above that sum, from three and a half or four per cent—let us endeavour to estimate, on something approaching to authentic data, the depreciation and destruction of property which had taken place even so early as 26th October last, when Government most properly stepped in to arrest the ruinous effects of Sir Robert Peel's currency bill of 1844.

We estimate the National Debt, funded and unfunded, in round numbers at £800,000,000; the railway property, which now produces a revenue of above £9,000,000 a-year, of which half is profit, at £100,000,000;[12] bank and other joint stock at as much; and the capital embarked in commerce and manufactures at £500,000,000. Thus, the loss on the moveable property of Great Britain by the present crisis, may be estimated as follows:—The three per cents. in August, 1845, were at £100-7/8, and for a considerable time were about 100: when Lord John Russell stepped in by his letter of 26th October, 1847, to arrest the consequences of Sir Robert Peel's bill of 1844, they were at 79; and the effect of that partial remedy, even with the bank advances for a month after at eight per cent., has been to raise them to 85. The depreciation of funded property, till the Act of 1844 was broken through, had been in two years from 100 to 80, or a fifth. Take the depreciation of all other moveable property engaged in fluctuating employments, on an average at the same amount and no more. We need not say how this understates the matter. How happy would a large part of the railway stockholders, merchants, and manufacturers of the United Kingdom be, if the depreciation of their property could truly be estimated at no larger an amount! But take it on an average as a fifth only,—the strength of the argument, as Mr Malthus said of his famous arithmetical and geometrical progression, will admit of almost any concession. The depreciation and destruction of property since 1845, will then stand thus:—

Here, then, is the result of thirty years' legislation, during which time, under different administrations, some bearing the names of Tory, others of Whig, liberal principles in every department of government have been without intermission in the ascendant. The Catholic emancipators, the Negro emancipators, reciprocity advocates, reformers, self-government men, bullionists, and free-traders, have got every thing their own way. The triumph over the old system was not immediate; it took a quarter of a century to complete it: like Wellington at Waterloo, it was late in the evening before the victory was gained. But gained it has been; and that not in one branch of government, but in every branch. The ancient system has been universally changed, and to such an extent, that scarcely a vestige of it now remains in the policy of Government. So uniform has been the alteration in every thing, that one would think our modern reformers had adopted the principle of their predecessors in the days of Calvin, who stood up to pray for no other reason but because the Roman Catholics knelt down. And what have been the results? Ireland, with some millions of paupers, in a state of anarchy and crime unparalleled in modern Europe; a hundred millions of property almost destroyed in the West Indies; the slave trade, tripled in extent, and quadrupled in horror throughout the globe; an irresistible ascendency given in the Legislature to urban electors; all protection to agriculture destroyed; from ten to twelve millions of quarters of grain—a full sixth of the annual subsistence—imported in a single year; the national independence virtually destroyed, by being placed to such an extent at the mercy of foreigners, for the food of the people; foreign shipping rapidly encroaching on British, so as to render the loss of our maritime superiority, at no distant period, if the same system be continued, a matter of certainty; the practical annihilation of the sinking fund; the permanent imposition of the war income-tax, in the thirty-second year of profound peace; a falling off in the revenue at the rate of six millions, and in our exports at the rate of twelve millions a-year; the depreciation and destruction of property to the amount of three hundred millions in two years in Great Britain; and, finally, the general stoppage of railway undertakings over the whole country, and the shutting or putting on short time of half the mills in our manufacturing cities, for whose benefit all these changes were intended! We doubt if the history of the Fall of Rome exhibited such a uniform and multifarious decay in an equal period; certainly no parallel to it has yet been presented in the annals of modern Europe.

If we thought that this long and portentous catalogue of disasters was unavoidable, and could not be remedied by human wisdom, we would submit to it in silence, and we trust with resignation, as we do to the certainty of death, or the chances of plague, pestilence, or famine, arising from the dispensations of Providence, for wise and inscrutable purposes, but over which we have no control. But this is very far from being the case. We believe, as firmly as we do in our own existence, that they are entirely of our own creation,—that they are the result solely and exclusively of false principles diffused through our people, and false measures in consequence forced upon our Government; and that, though the consequences of these false principles must be long and disastrous, yet it is still possible to remedy the evil, to convert a land of mourning into a land of joy, and restore again the merry days to Old England. The retreat from the ways of error never was to nations, any more than individuals, by any other path but the path of suffering; but if the retreat is made, and the suffering borne, we trust in the good providence of God, and energy of the British character to repair all that is past.

The distress which prevails in the nation, and, most of all, in the commercial districts and cities, being universal and undeniable, the supporters of the present system, which has led to such results, are sorely puzzled how to explain so decisive and damning a practical refutation of their theories. The common theory put forth by the free traders and bullionists is, that it is the railways and Irish famine which have done it all. This is the explanation which for months has been daily advanced by the Times, and which has been formally adopted by the leaders of government in both Houses. We are a miserably poor nation; we have eaten up our resources; the strain upon our wealth has been greater than we could bear. This, of having eaten up our resources, has, in a peculiar manner, got hold of the imaginations of the able writers in the Times; and, forgetting that a great importation of food was the very thing which they themselves had held forth as the great blessing to be derived from free trade, they give the following alarming account of the food devoured by the nation in the first nine months of 1847:—

"Of live animals and provisions imported in 1847, there is an excess over last year of more than 100 per cent., of butter (duty paid) 35 per cent.; of cheese 15 per cent.; of grain and flour 300 per cent.; of coffee (duty paid) between 8 and 9 per cent.; of sugar (duty paid) 15 per cent., and of spirits (duty paid) 25 per cent. This has all been eaten and drunk. But how, it will be said, is it possible it can have been paid for? and what a splendid export trade the nation must have carried on, when all this has taken place, and only six millions of bullion have disappeared! Unfortunately, however, the explanation lies deeper. Although we have been extravagant in our living, we have starved our manufactories. We have sold our goods wherever we could find a market for them, and we have abstained from purchasing the materials out of which we may make more. We have not increased our export trade. It shows, in fact, a diminution as compared with last year; but in our avidity to consume luxuries, we have foregone, as we could not sustain the expenditure of both, keeping up the stock by which our mills and manufactories are to be fed."—Times, November 24, 1847.

So that the free traders have at last discovered that the unlimited importation of food is not, after all, so great a blessing as they had so long held forth. They have found to their cost that there is some little difference between sending thirty millions in twelve months in hard cash to America and the Continent for grain, and sending it to Kent, Yorkshire, Essex, and Scotland. They have discovered that there is such a thing as a nation increasing its imports enormously and beyond all example, and at the same time its exports declining in the same proportion, from the abstraction of the circulating medium requisite to carry on domestic fabrics. All this is what the Protectionists constantly predicted would follow the adoption of free trade principles; and they warned government in the most earnest manner two years ago, that no increase of exports, but the reverse, would follow the throwing open our ports to foreign grain; and that, unless provision were made for extending the currency when our sovereigns were sent abroad for foreign grain, general ruin would ensue. Two years ago Mr Alison observed:—

"Holding it to be clear that, under the free trade system, a very large importation of grain into these islands may be looked for now, even in ordinary seasons, and an immense one in bad harvests, it is essential that the country should look steadily in the face the constant drain upon its metallic resources which such a trade must occasion. Adverting to the disastrous effects of such an exportation of the precious metals in 1839, from a single year of such extensive importation of foreign corn, it is impossible to contemplate without the most serious alarm the conversion of that drain into a permanent burden upon the specie of the country. As the change now to be made will undoubtedly depress agricultural industry, it is devoutly to be hoped that, as some compensation, the expected increase of our manufactures for foreign markets may take place. But this extension will, of course, require a proportional augmentation of the currency to carry it on. And how is that to be provided under the metallic system, when the simultaneous import of foreign grain is every day drawing more and more of the precious metals out of the country, in exchange for food?"—(England in 1815 and 1845, third edition, Preface, page xi. published in April 1846.)

But let it be conceded that the government and the Times are in the right on this point; that the importation of grain, coexisting with the absorption of capital in the railways, was more than so poor a nation as Great Britain could bear, and that the dreadful crisis which ensued was the consequence—we would beg to ask, who has made us so poor? We shall lay before our readers a few facts in regard to the resources of this miserably poor nation—this poverty-stricken people, who have eaten up their little all in the form of 10,000,000 quarters of grain and 176,000 live cattle, imported in the last nine months. We shall show what they were before the free trade and fettered currency system began; and having done so, we shall repeat the question,—"Who has made us so poor?"

This miserable poverty-stricken people, in the years 1813, 1814, and 1815—in the close of a bloody and costly war of twenty years' duration, during which they raised £585,000,000 by loans to government, and, on an average, £50,000,000 annually by taxes, from a population, including Ireland, not in those last years exceeding 18,000,000 of souls—made the following advances and contributions to government for the public service:—

If any one supposes these figures are inaccurate, or this statement exaggerated, we beg to say they are not our own. They are copied literatim from Porter's Parliamentary Tables, vol. i. p. 1; and we beg to refer to that gentleman at the Board of Trade, to whom, on account of his well-known accuracy, the Chancellor refers for all his statistical facts, for an explanation of these, we admit, astounding ones.

Was the capital of the country exhausted by these enormous contributions of A HUNDRED AND SEVENTY MILLIONS annually to the public service, in the twentieth year of the most costly war on record? So far from it, the great loan for 1814 of £39,000,000 was made at the rate of £4, 11s. 1d. PER CENT; that of 1813 at £5, 10s. on an average; that of 1815 at £5, 11s. per cent.[13] And it is evidently immaterial whether the immense amount of £100,000,000 debt, funded and unfunded together, was contracted in the form of direct loan to government, or of Exchequer bills issued from the Treasury, and forming the unfunded debt. Such bills required to be discounted before they were of any value; and their proceeds, as Mr Porter very properly states, were so much money paid into the public treasury. They were an exchange of the capital of the nation for Treasury bills, and were, therefore, just as much a draft on that capital as the exchange of the sums subscribed in loans for the inscription of certain sums in the 3 per cent. consols.

In the next place, this poor nation, which has now nearly eaten up its resources in a single season, in the year 1844 possessed, in the two islands, real or heritable property of the yearly value of £105,000,000 sterling,[14] corresponding to a capital, at thirty years' purchase, of £3,150,000,000; and at twenty-five years' purchase, to one of £2,625,000,000. These figures are ascertained in the most authentic manner; that of England by the Report of the Lords' Committee on the burdens of real property;[15] that of Ireland by the Poors' Rate returns; and that of Scotland from an estimate founded on the amount of income-tax paid, as no poors' rate as yet extends universally over the country.

Further, we have the authority of Lord Palmerston, in the debate in last session of Parliament on foreign loans, for the assertion that this poor nation has advanced £150,000,000 in loans to republics since 1824, or to monarchies surrounded with republican institutions; the greater part of which has been lost. Yet so far have these copious drafts been from exhausting, or even seriously trenching, on the capital of the nation, that it appears from the subjoined valuable table, furnished from returns allowed to be taken from the great bill-broking house of Overend and Gurney in London,[16] that during that whole period the interest of money, even in the years when the pressure was severest, never rose above 6 per cent., and immediately after fell to 3½ or 3 per cent., and in 1844 and 1845, it is well known, it was still lower, at some times as low as 2½ per cent.

Again, the income-tax returns for 1846, of this miserably poor nation, exhibit a revenue of £5,200,000 yearly drawn from this source, though the tax is only 7d. in the pound, or £2, 18s. 4d. per cent., and though the tax did not legally go below incomes of £150, and in practice generally excluded those under £200 a-year. The income-tax, in the last year of the war, produced £15,000,000 at 10 per cent., reaching all incomes above £60 a-year. Had the same standard been adopted in 1842, when it was reimposed by Sir R. Peel, it would have produced at least £18,000,000 yearly, which sum, increased by 33 per cent. from the enhanced value of money by the operation of the act of 1819, would correspond to about £24,000,000, according to the value of money in 1815. This proves that the wealth of the nation had more than kept pace with the increase of its population; for the numbers of the people in the two islands in 1815 were 18,000,000, and in 1845 about 28,000,000, or somewhat above 50 per cent. increase.

Lastly, this miserably poor nation, which has eaten up its resources in the shape of quarters of grain and fat bullocks in a single year, exported and imported in the three years 1812, 1814, and 1815, and 1843, 1844, and 1845, before free-trade began, respectively as follows:

Such were the commercial transactions of this nation, which, in the interval from 1815 to 1845, had become so miserably poor.

Keeping these facts in view, we again ask: Having down to 1845 been so rich, what has since made us so poor? The free-traders and bullionists tell us it was neither the abolition of the corn-laws nor the Bank Charter Act. Then what is it which in so short a time has produced so great, so terrible a revulsion? Government, and their organs in the press, assert that it was the Irish famine, and the absorption of capital in railways. To avoid any chance of misconception on so vital a point, we subjoin the words of the Chancellor of the Exchequer in the debate on the currency on 30th November 1847, as reported in the Morning Post of December 1, which were in substance the same as those employed by the Marquis of Lansdowne in the House of Lords:—

"Up to October there had been no great pressure; but in that month the pressure rapidly rose by reason of the abstraction of capital for railways and corn. The House would be surprised to hear the amount of capital thus abstracted for corn in fifteen months.

Then as to the capital absorbed in railroads, it had been in each year, from 1840, on an average, to

the latter being, of course, estimated on the supposition of the expenditure having continued at the same rates."—Morning Post, December 1, 1847.

Now of all the marvellous statements that ever were put forth by a government to explain a great public disaster, we do not hesitate to say this is the most marvellous. For let it be conceded that these are the real causes of the distress,—that it is the railways and the importation of foreign corn which have done it all—Who introduced the railways and let in an unlimited supply of foreign corn? Who passed all the railway bills, and encouraged the nation in the undertakings which are now held forth as so entirely disproportioned to its strength? Who took credit to themselves for the prosperity which the construction of railways at first occasioned, and dwelt with peculiar complacency, in the opening of the Session of 1846, on the increased produce of the excise, and diminution of crime, as indicating at once the augmented enjoyments and diminished disorders of the poor? Who disregarded the cautious, and as the event has proved, wise warnings of Lord Dalhousie at the Board of Trade? Who opened the railway of the Trent Valley with a silver trowel, and enlarged in eloquent terms on the immense advantages which that and similar undertakings would bring to the country? Sir Robert Peel and the party who now put down the whole evils which have ensued to the foreign corn and railways. Was a single word heard from them condemnatory of the mania which had seized the nation, and prophetic of the disasters which would ensue from its continuance? Did Sir Robert Peel warn the people that the currency was put on a new footing; that the act of 1844 had forbid its extension beyond thirty-two millions issuable on securities, and that as credit was thus materially abridged, the capital of the nation would be found inadequate to the undertakings in which it had engaged? Quite the reverse; he did none of these things. He encouraged the embarking of the capital of the nation in railways to the extent of above two hundred millions,[17] all to be executed in the next four years; and now we are told that the disasters which have ensued are mainly owing to that very unmanageable railway progeny which he himself produced!

Again, as to the importation of foreign grain, the second scape-goat let go to bear the sins of the nation—who let that scape-goat loose? Who introduced the free trade system, and destroyed the former protection on native agriculture, and disregarded or ridiculed all the warnings so strenuously given by the Protection party, that it would induce such a drain on the metallic resources of the country as must induce a speedy monetary crisis, and would subject the nation permanently to that ruinous wasting away which proved fatal to the Roman empire, when the harvests of Egypt and Libya came to supplant those of Italy in supplying the cities of the heart of the empire with food? Who declared that the great thing is to increase our importations, and that provided this is done the exportations will take care of themselves? Who laughed at the warning, "Two things may go out, manufactures or specie"? It was Sir Robert Peel and his free trade followers who did all these things; and yet he and his party, in or out of administration, (for they are all his party,) coolly now turn round and tell us that the misery is all owing to the foreign corn and the railways, which they themselves introduced!

The Irish potato rot of 1846, it is said, occasioned the great importation of grain, which for the next winter and spring deluged the country; and but for them we should have been landed in the horrors of actual famine over a great part of the country. We entirely agree with this statement. The Protectionists always were the first not only to admit, but urgently to insist that absolute freedom of importation should be allowed in periods of real scarcity. The sliding-scale formerly in use expressly provided for this; for the duty began to fall when wheat reached sixty-three shillings, and declined till at seventy-three shillings it was only one shilling a-quarter. It was on the propriety of admitting grain duty-free in periods of average or fine harvests, such as we have just been blessed with, that they were at issue with their opponents. Under the old system, nearly all the grain which was imported in the winter of 1846 and spring of 1847, would have come in, for the duties became nominal when wheat rose to seventy-three shillings a-quarter, and it rose during that period to one hundred and five and one hundred and ten shillings. What the Protectionists said, and said earnestly, when this vast importation, necessary at the time, was going on, that it anticipated the effects of a free importation of grain, and by its effect on the currency, while it lasted, might teach the nation what they had to expect when a similar drain, by the effects of free trade, became perpetual. Eight months ago, on March 1, 1847, we made the following observations in this Magazine:-

"The quantity of grain imported in seven months only, viz. from 5th July 1846, to 5th February 1847, exceeded six millions of quarters, at the very time when our exports were diminishing. It may be imagined how prodigious must have been the drain upon the metallic resources of the country to make up the balance. The potato rot, it is said, has concealed the effects of free trade. Quite the reverse. Providence has done the thing at once. We have got on at railway speed to the blessings of the new system. Free trade was to lead to the much desired substitution of six millions of quarters of foreign, for six millions of quarters of home growth in three years. But the potato rot has done it in one. The free trade policy could not have done it so expeditiously, but it would have done it as effectually. It is a total mistake, therefore, to represent the famine in Ireland and the West of Scotland as an external calamity which has concealed the effects of free trade. It has only brought them to light at once."—Lessons from the Famine. Blackwood's Magazine, March 1847.

The real amount of the famine in Ireland, of which so much has been said, was very much magnified, however, by the fears of some parties and the interested exaggerations of others. The deficiency in the two islands has been stated variously, at from sixteen to twenty million pounds worth. Take it at the larger sum to avoid all idea of misrepresentation—what is this to the total agricultural produce of Great Britain and Ireland? That is estimated by Mr Porter on very rational grounds at three hundred millions annually, in produce of all kinds. The subtraction of twenty millions worth;—a fifteenth part, at the very utmost, could never account for the prodigious rise of prices from forty-nine shillings a-quarter to one hundred and ten shillings, which wheat rose to in March 1847. It was the impulse given to speculation in grain, by the sudden throwing open of the ports by Sir Robert Peel's free trade measures, which really occasioned the prodigious importation so much exceeding what was required, which actually took place. The defalcation occasioned by the Irish potato rot, and the deficiency of the oat-crop in Great Britain, was at the very utmost a fifteenth part of the annual supply. But the grain imported in the first nine months of this year has exceeded ten millions of quarters, being a full sixth part of the annual consumption of the nation, which for the use of man and animals together is estimated at sixty million quarters. And hence the rapid fall of prices which followed the fine harvest of 1847, from one hundred shillings to fifty shillings, which has involved in ruin so many houses concerned in the corn trade.

But what is particularly worthy of notice, and what we in the most earnest manner beg to impress upon our readers as by far the most luminous and important fact which the recent discussions in parliament have elicited, is this. It is stated, as has been already noticed, by the Chancellor of the Exchequer, that the sum paid for foreign grain in the three months ending November 30th 1847, that is in the months of September, October, and November, 1847, had reached the enormous and unprecedented amount of £14,240,000! The same statement was made by Lord Lansdowne in the House of Lords; and the Chancellor of the Exchequer added, that to be sure of the figures, he had them remitted to and corrected by Mr Porter. Now, this immense importation, be it recollected, took place IN THE FACE OF THE FINEST HARVEST KNOWN FOR YEARS, and for which a public and solemn thanksgiving has just been returned. We say nothing of the prospects of foreign importation which this fact opens to our agricultural interests,—that furnishes ample subject for future consideration; what we pray the public attention to, is the warning which it gives of the effects of free trade upon the monetary concerns of the nation, and above all on the credit of the trading and commercial classes. This is the importation, in an uncommonly fine season, with a noble harvest in both islands, just reaped! The dreadful monetary crisis of October 1847, which rendered the suspension of the Bank Charter Act, on the 25th of that month, indispensable, was evidently owing to the prodigious importation which all the fineness of the preceding harvest could not check. The crisis of April 1847, may with justice be ascribed to the failure of the potato crop in Ireland, and would probably have come on, though not with the same intensity, though the change on the corn laws had been made by Sir Robert Peel in the July preceding. But it is rather too much to go on talking in December 1847, about the failure of the crop of 1846 in Ireland, four months after one of the finest crops in the memory of man had been reaped in the British dominions.

This points to one great and lasting truth, the due appreciation of which by the people of Great Britain is of such paramount importance, that it will be cheaply purchased even at the cost of all the misery and destruction of property which the late crisis has occasioned in the British empire. This is, that the great importation of grain, and consequent abstraction of the precious metals consequent upon the free-trade system, may be expected to be permanent. We have repeatedly warned the nation in every possible form that this would be the case, but our warnings during the free-trade mania met with no attention. Now, however, it has been proved by the event that they were too well founded. The old and rich state will always be undersold by the young and poor one in the supply of grain for its own market. The grain-growing state never will take manufactures to any proportional extent, but always will take gold in exchange. This was the case with Rome in ancient days; this is the case with England in these times. The steam-engine and machinery do little or nothing for agriculture, though every thing for manufactures. The great grain states are always those nations in which the labouring-class are poor, or have few artificial wants, and consequently take few or no manufactures. Poland, the Ukraine, the Valley of the Mississippi, are examples. Gold is what they want, and what they will have; for it is the cheapness of their production which enables them to export to advantage. So universal is this truth, of such paramount importance is it upon the fortunes of an old and highly civilised state, that, it may safely be affirmed, its existence in its old age depends on the requisite safeguards against the danger thence arising being established. Such are the effects of the constant drain of gold and importation of grain on such a state in its advanced stages, that even the strongest nation will sink in time under the strain, as Rome did, if nothing is done to avert the danger.

The present dreadful crisis under which the nation is labouring, therefore, is not owing to a want of capital for all its undertakings, nor to any present deficiency in our native supply of food. It is in vain that Sir R. Peel, to throw the blame off the Bank Charter Act, says it is all owing to a deficiency of capital to carry on our undertakings. Has the Right Hon. Baronet forgotten that, so recently as March last, the Chancellor of the Exchequer borrowed £8,000,000 for the destitute Irish at £3, 7s. 6d. per cent.? Was this like a nation, the capital of which was exhausted? Has he forgotten that, till within these few months, the funds were from 88 to 90, and interest generally at 3 or 3½ per cent.? What has come of all this capital since August last? Has it vanished before the genial showers and bright sun which gave us so fine a harvest? But if deficient capital has been the cause of our disasters, how has it happened that Lord John Russell's letter of 25th October, authorising the Bank to make advances beyond what the Act allowed, has already had a sensible effect in arresting the disorder, at least in the metropolis? Can it be said that that letter added one pound to the realised capital of the country? It might as well be affirmed that it added a cubit to every man's stature in it, or a quarter to the produce of every field it contained. Then how has it to some degree arrested the panic in London, raised the 3 per cents. from 79 to 86, and lowered the interest of money from 8 or 9 to 6 or 7 per cent.? Evidently by its effect upon CREDIT; because it begat a hope—not likely, we fear, to be realised—that government had at last become sensible of the ruinous effect of the Bank Charter Act, and would speedily restore the circulation of the country to that amount, which the magnitude of its population and transactions imperatively required.

To illustrate the terrible and all-powerful operation of this deplorable Act on the best interests of the country, let it be supposed for a moment that the whole currency of the country, without any change in its laws as affecting debtor and creditor, were to be withdrawn. What would be the result? Evidently that every man and woman it contained, from Queen Victoria and the Chancellor of the Exchequer downwards, would become bankrupt. A nation possessing real property, as the income-tax and poor-rate returns show, of the value of £3,000,000,000 sterling, and moveable property of £2,000,000,000 more, would, without the exception of a single living creature in it, become bankrupt because £70,000,000 or £80,000,000 was withdrawn from its circulation, while its laws remained unchanged. By these laws, every debtor must discharge his liabilities in money; and therefore, if the whole money was withdrawn, no debt could be discharged at all, and universal bankruptcy would ensue.

Now, the contraction of the currency to any considerable extent operates, so far as it goes, in just the same way on general credit and the national fortunes. When money becomes scarce, no one can, without difficulty, discharge his obligations, because the banks, who are the reservoirs from which payment of all considerable transactions are drawn, cannot afford the usual accommodation. Those who are not in first-rate credit can get nothing from them at all, and at once become bankrupt. The sum-total of difficulty and embarrassment thus occasioned, is not to be measured by the amount of specie or bank-notes actually withdrawn from circulation by the Bank of England, though that on occasion of the present crisis has been very considerable. It is to be measured by the shock given to credit; the increase in the practice of hoarding, which a feeling of general insecurity never fails to engender; the reluctance in the country banks to make advances; the universal effort made to recover debts at the very time when the means of discharging them have been rendered most difficult; the rapid diminution in the private bills put in circulation from the experienced impossibility of getting them discounted. The contraction of the currency on the part of the Bank of England, from July 1846, when it was £21,000,000, to September 1847, when it was only £17,840,000, was no less than £3,160,000. Including the simultaneous and consequent contraction by the country banks in Great Britain and Ireland, the diminution of the paper currency was above £5,000,000. But this, considerable as it is, was but a small part of the evil. The bills in circulation in Great Britain in 1839 were estimated by Mr Leatham, a most experienced Yorkshire banker, at £130,000,000. In 1845, it may safely be assumed, that they had reached £160,000,000 or £170,000,000. Without a doubt this immense sum was reduced by at least a fourth, probably a half, from the contraction of the currency consequent on the Bank Act of 1844. It is this prodigious contraction, the necessary consequence of the banks having been rendered unable or unwilling to discount bills, which is the real cause of the present universal distress and general stoppage of all undertakings. And it was the more ruinous from the circumstance, that it occurred at the very time when, from the vast encouragement given by government to domestic railways by the bills they passed, and to foreign trade from the abolition of the main duties protective of industry by them, the nation was landed in transactions of unheard-of magnitude, and producing an unparalleled strain upon its metallic resources.

This last is a consideration of such paramount importance, that it is of itself adequate to explain the whole phenomena, which have occurred; and yet, strange to say, it has hitherto met with very little attention either in or out of Parliament. The point to which we allude, and to which we crave, in an especial manner, the attention of the nation, is the progressive and now alarming disproportion between the money value of our imports and our exports which has grown up ever since Sir Robert Peel's tariff was introduced in 1842, and which has now, from the action of the free-trade in corn, risen to such a height as to be absolutely frightful. The declared or money values of our total exports and official value of our imports since Sir Robert Peel's tariff was passed in 1842, have stood as follows:—

The imports for 1847 have not yet been made up, and cannot be till January next, when the year is concluded. But in the figures we have given, there is abundant room for the most serious reflection. The fact which the Chancellor of the Exchequer has mentioned as to the sums paid for grain alone, in fifteen months, having reached the enormous and unprecedented amount of £33,000,000, leaves no room for doubt that, in the year 1847, our imports will have reached £100,000,000, while our exports have sunk below £50,000,000.[18] Now, how was this fearful balance paid? The answer is evident. In cash. Here then, without going farther, is a balance on the exports and imports already returned, in 1846, of forty millions against the nation, on the transactions of the present year, of probably not less than FIFTY MILLIONS STERLING.[19] Whoever considers these figures with attention, will be at no loss to perceive from what cause in the main the present disasters have arisen.

To give only one example of the way in which, under the system of free importation, the balance of trade has been turned against this country, we subjoin the official returns of the progress of our trade with America since Sir Robert Peel's tariff was introduced in 1842, and for five years previously.[20] From that it appears that the trade with that country, which in 1830 was £8,000,000 on each side, has now so immensely changed, especially since the tariff of 1842, that, while our exports to it in 1845 were £10,000,000, our imports from it were £22,000,000! How was the balance of £12,000,000 paid? The answer is, in money; and that money it was which enabled them to conquer the Mexicans. We shall look with anxiety for the returns of our exports to, and importations from America for the last two years. When they appear, it will at once be seen where the money, the want of which is now so severely felt, has gone, under the fostering influence of free trade.

Sir Robert Peel says that the Americans have tried the system of paper money, and they have had enough of it. We thank the Right Honourable Baronet for having reminded us of this example of the effects of a contracted currency. It appears that in 1836 the imports of English manufactures into the United States were £15,116,300. In the next year they were only £5,693,094 official value; and the declared or real value in that year was only £4,695,225; and the declared value of the imports from Great Britain in 1842, was only £3,528,807.[21] What occasioned this extraordinary defalcation, we shall inform the Right Honourable Baronet. In spring 1837, the metallic system was introduced by General Jackson, then President of the United States, (by his refusal to take any thing but specie in payment of government claims,) the country being at the time engaged in vast railway and other undertakings, with the concurrence and by the authority of government. Thence the prodigious falling off in the imports from this country, under which our own manufacturers suffered so severely, and from which they have scarcely yet recovered. Thence the destruction of three-fourths of the mercantile capital of the United States. May heaven avert a similar catastrophe, resulting from the same policy, in this country!

The causes, then, to which the present dreadful crisis is owing, are as plain as if the proofs of them were to be found in Holy Writ. We shall simply record what Sir Robert Peel and the bullion party have done for the last five years, and then ask whether under such a system it was possible a catastrophe could be averted.

In the first place, they introduced the tariff of 1842, which so materially diminished the duties on importation in this country, and gave so great an impulse to the introduction of foreign articles of all sorts into the consumption of the people, as raised our imports in 1845 to £85,000,000, while our exports were only £53,000,000, exhibiting a balance of £32,000,000 against the country, which of course required to be paid in the precious metals.

Secondly, having established this great drain of nearly thirty millions annually on the metallic resources of the country, Sir Robert Peel next proceeded to pass the Bank Charter Acts, for England of 1844, and for Scotland and Ireland of 1845, which limited the bank notes of the empire, issuable on securities, to £32,000,000,[22] and enacted that for every note issued beyond that amount, a sovereign should be in the bank's strong-room to represent it.

Thirdly, having imposed these firm restrictions on the increase of the paper circulation, and left no room for an augmentation to meet the growing wants of the community but by an addition to the stores of bullion in the country, and compelled a proportional contraction of the currency when the bullion was withdrawn, the Right Honourable Baronet and his administration next passed railway bills to the amount of above £150,000,000 sterling, to be executed in the next three years, and gave every facility to the undertaking of such projects, by lowering the deposits required from ten to five per cent. on the estimated cost of the undertakings.

Fourthly, when the strain on the metallic resources of the country was beginning to be felt, from the immense balance of thirty millions in our commerce against us, and the calls on railway shares were becoming considerable, the Right Honourable Baronet next, as a permanent system, not an extraordinary remedy to meet a temporary disaster, introduced a free trade in grain, which was immediately applied by his successors to sugar. He thus sent thirty-three millions, in gold and silver, abroad in fifteen months. The consequence has been that the imports of the empire have probably become double its exports in money value; that a balance of nearly £50,000,000 has this year been sent abroad in payment of articles of import; that the sums paid for grain alone in the three months immediately following the finest harvest on record, have exceeded £14,000,000; that nearly all the railways in the country have been stopped from the necessary contraction which, under the existing law, this export of specie occasioned to the currency; that distress of dreadful magnitude pervades the mercantile and manufacturing classes; and that our exports have fallen off at the rate of a million a-month, and our revenue above six millions a-year.

Such are the principles and results of that splendid combination effected by modern wisdom—FREE TRADE AND A FETTERED CURRENCY. And as these results flow naturally and necessarily from the principles put in practice, it is evident that they may be expected in a less or greater degree to be permanent, so long as these principles regulate the policy of government.

Suppose a general at the head of one hundred thousand men were to double, by orders issued or licenses granted from head-quarters, the distance to be marched, and the work done by the men, and at the same time to establish a system which sent half of the commissariat stores out of the camp,—what could be expected from such a policy but starvation, discontent, and ultimate mutiny among the soldiers? Or suppose a master manufacturer, as a great improvement on the machinery of his mill, were to introduce a system which abstracted the oil in proportion to the quickened movement of the wheels, or diminished the moving power in proportion to the increase of the work to be done,—what could be expected from such a change, but that the machine would stop when it had most work to do? And yet, is not a currency, and a sufficient currency, as necessary to an industrious nation as food to the soldier, or coals to the steam-engine, or oil to the wheels? Can we be surprised that such a system, when applied to a nation, terminated in disappointment and ruin? But one result of inestimable value has followed from its adoption; it is in periods of suffering that truth is learned, because the consequences of error are experienced. It is now seen what the true principles on the subject are, because the effects of the opposite principles have been demonstrated. With truth may it be said, that Sir R. Peel is the philosopher who "HAS INSTRUCTED US IN THE CURRENCY."

It is the same thing, it is often said, whether we send specie abroad in return for imports or manufactures of our own creation, for specie is not the growth of this country, and it could only have been brought here in return for some produce of ours previously exported. The common sense of mankind, founded on experienced suffering arising from the abstraction of specie, has ever repudiated this doctrine of the schools; and present experience has amply demonstrated that, how specious soever it may appear, there is some fallacy in it. Nor is it difficult to see what that fallacy is. If we send manufactures abroad in exchange for specie, we make a fair exchange; but if, having got the specie, we send IT abroad again, instead of manufactures, to buy food,—we have only one export of British produce to set off against two imports of foreign. For instance, if we send £5,000,000 worth of manufactures to South America to buy that amount of specie, it is a fair exchange, and there is no unfavourable balance established against us. But if, having got the £5,000,000 worth of specie, we again send it to North America for grain, which is imported into this country, instead of sending £5,000,000 worth of manufactures, we have, on the whole, only exported £5,000,000 worth of manufactures for £10,000,000 worth of produce, bullion and corn imported: that is, there is a balance of trade to the amount of £5,000,000 established against us, which, to that extent, is a drain on our metallic resources. Had we sent £5,000,000 worth of manufactures instead of the same amount of specie to North America to buy food, our exports on the whole would have been £10,000,000 instead of £5,000,000; and the difference of £5,000,000, instead of being a deduction from, would have been an addition to the metallic resources, that is, the life-blood of the nation. It is because a great import of grain invariably leads to such an export of specie, that it is so hazardous a trade for a nation: it is because Sir R. Peel's policy contracted the paper currency at the very time that he sent the metallic abroad in quest of food, that he has brought such calamities on the State.

The Right Hon. Baronet's defence of his policy is mainly to be found in the following paragraph of his late able speech, in the close of the currency debate:—

"I think there has been some misapprehension as to the objects contemplated by the Act of 1844. I do not deny that one of them was the prevention of the convulsions that had theretofore occurred in consequence of the Bank of England not taking due precautions as to the regulation of its issues. I did hope, after the experience of former crises, that the Bank of England would adhere to those principles of banking which the directors acknowledged to be just, but from which they admitted they have departed. (Hear, hear, hear.) I am bound to admit that in that hope, and in that object, I have been disappointed; and I also admit, seeing the number of houses that have been swept away—some of which, I fear, were long insolvent—(Hear, hear)—and others which, being solvent, have suffered from the failure of other houses—I am bound to say that in that object of the Bill I have been disappointed. (Hear, hear.) It was in the power of the Bank to have, at an early period of the distress, raised the rate of discount, and to have refused some of the accommodation they granted between 1844 and 1846. (Hear, hear, hear.) I cannot, therefore, say that the defect is exclusively, or mainly, in the Bill—(Hear, hear)—but my belief is, that executive interference might have been given without the necessity of the authority of the noble lord."—Morning Post, Dec. 2, 1847.

The observations which have now been made, show that these remarks are not only unfounded, but precisely the reverse of the truth. Had the Bank of England drawn in their discounts, and raised the rate of interest between 1844 and 1846, at the very time when the railway and free-trade work, into which Sir Robert Peel had plunged the nation, was at its height, what must have been the result? Nothing but this: that the catastrophe which has ensued would have come on two years sooner than it has actually done. The Right Hon. Baronet would have been prevented from making his emphatic speech on the admirable effects of his policy, and the diminution of crime, in the opening of the Session of 1846; he would have found the jails and the workhouses full enough, at the period of that glowing eulogium on free-trade policy and its effects. By making liberal advances to railway companies in 1844 and 1845, the Bank of England, and the other banks which followed its example, only enabled the country for a time to do the work upon which Sir Robert Peel had set it. By enabling, by similar advances, the manufacturers for two years longer than they otherwise could have done, to send a large export of manufactures abroad, the Bank, for that period, averted or postponed the catastrophe which must ensue in a commercial state, when its imports, for a series of years, have come greatly to exceed its exports. It is because the contraction of the currency, rendered imperative on the Bank by the Right Hon. Baronet's bill, has disabled our manufacturers from carrying on their operations to their wonted extent, that the import of the raw materials employed in manufactures, has decreased during the last eighteen months to such an extent, our export of manufactures declined in a corresponding degree, and the drain of specie abroad to pay for the enormous importations simultaneously introduced, increased to such a ruinous extent.

Sir R. Peel reminds us of the great catastrophe of December 1825, and observes that that disaster, at least, cannot be ascribed to his Bank Charter Act, and that it arose from the everlasting tendency to overtrading in the people of this country. Again we thank the Right Hon. Bart. for reminding us of that disastrous epoch, which, in the still greater suffering with which we are now surrounded, had been well-nigh forgotten. We entirely agree with him as to the magnitude of that crisis, and we will tell him to what it was owing, and how it was surmounted. It was owing to Mr Secretary Canning, in pursuance of liberal principles, "calling a new world into existence," by violating the faith and breaking through the duties of the old one. It arose from the prodigious loans sent from this country to prop up the rickety, faithless, insolvent republics of South America, and the boundless incitements held out to wild speculation at that period by "Mr Prosperity Robinson," especially in South American mining speculations. It arose from all this being done and encouraged by the government, at the very time when the act of 1819, introduced by Sir R. Peel, compelled the Bank,—though drained almost to the last guinea, by the prodigious quantity of gold sent headlong to South America to support these speculations, induced or fostered by the government,—to pay all its notes in gold. This was what induced the crisis. And what arrested it? Lord Ashburton has told us it was the issue of £2,000,000 of forgotten bank-notes, drawn out of a cellar of the Bank; but which sum, inconsiderable as it was, proved sufficient to arrest the consequences of the gold being all sent away to South America, in pursuance of liberal principles, to prop up "healthy young republics," carved out of the dominions of an old and faithful ally. Sir R. Peel, two-and-twenty years afterwards, has repeated the same error, by sending the gold to North America in the midst of great domestic transactions for grain, but he has not repeated the same remedy.

In truth, the system now established in regard to the bank by the acts of 1819 and 1844, necessarily induces that very feverish excitement in periods of prosperity, and sudden contraction in those of adversity, of the consequences of which Sir R. Peel so loudly complains. When the bank is obliged to accumulate and keep in its vaults so prodigious a treasure as £15,000,000 in prosperous times, and £9,000,000 or £10,000,000 in those of adversity, lying dead in its possession; how is it to indemnify itself for so vast an outlay, without, whenever an opportunity presents itself, pushing its circulation to the utmost? The very interest of this treasure amounts, at 5 per cent., to above £700,000 a-year; at 7 per cent., the present rate, it will reach a million. How is this sum to be made up, the expense of the establishment defrayed, and any profit at all realised for the proprietors, if paper, to a large amount, is not pushed out whenever an opportunity presents itself for doing so to advantage?

Again, in adverse times, when there is a heavy drain upon the establishment for buying foreign grain, or discharging adverse exchanges, how is the bank to avoid insolvency, without at once, and suddenly, contracting its issues? The thing is unavoidable. Undue encouragement to speculation in prosperity, and undue contraction of credit in adversity, is to the Bank, since the acts of 1819 and 1844, not merely an essential preliminary to profit, but in trouble the condition of existence. Yet Sir R. Peel complains of the Bank doing that which his own acts have rendered indispensable to that establishment.

Sir R. Peel asserts that many of the houses which have lately become insolvent, have done so from excessive imprudence of speculation; and he succeeded in eliciting some cheers and laughter from the House of Commons, by contrasting in some extreme cases the amount of the debts brought out in bankruptcy with the assets. Without deeming it necessary to defend the conduct of all the houses, the affairs of which have been rendered public by the vast corn trade and railway speculations into which he plunged the nation, it seems sufficient to observe, that all fortunes made by credit must, if suddenly arrested in the course of formation by such a contraction of the currency as we have lately experienced, exhibit the same, or nearly the same, results. Fortunes, with the magnitude of which the Right Hon. Baronet and Mr Jones Loyd are well acquainted, might possibly, if they had been thrown on their beam-ends suddenly, by such a tornado, have exhibited, when in growth, not a much more flattering feature. But the "Pilot who weathered the storm" was then at the helm, and he weathered it for their fortunes not less than for those of the country. He aided commercial distress in adversity by increasing, instead of aggravating it by contracting, the currency. It is credit which has made us what we are, and credit which must keep us such. Had the monetary system of Sir R. Peel been adopted forty years ago, as the bullion committee said it should, we shall tell the Right Hon. Baronet what would have been the result. Great Britain would have been a province of France: the fortunes of all its merchants would have been destroyed: the business talents of Mr Jones Loyd would probably have procured for him the situation of cashier of the branch of the Bank of France established in London; and possibly the rhetorical abilities of Sir R. Peel might have raised him to the station of the English M. De Fontaine, the orator on the government side in the British Chamber of Deputies, held under an imperial viceroy on the banks of the Thames.

Sir R. Peel admits his bill has failed in checking improvident speculation in the nation; nor could he well have maintained the reverse, when the most extravagant speculations on record, at least in this island, succeeded, in the very next year, the passing of his bill. Experience has proved that it required to be suspended by the authority of the executive when the disaster came; and the effect of that suspension has already been to raise the three per cents from 79 to 86. It is ineffective during prosperity to check imprudence; it requires to be suspended in adversity, because it aggravates disaster. This is all on the Right Hon. Baronet's own admission. What good then has it done, or what can be ascribed to it, to counterbalance the numerous evils which have followed in its train?

Sir R. Peel says the experience of the last half century proves, that every period of prosperity is followed by a corresponding period of disaster, and that it is under one of the latter periods of depression that the nation is now labouring. We agree with the Right Honourable Baronet that for thirty years past this has been the case, and we will tell him the reason why. It is because for that period his principles have been in operation. But there was a period before that when no such deplorable alternations of good and evil took place; when the nation in prosperity was strong without running riot, and the government in adversity checked disaster, instead of aggravating it. It was the period from 1793 to 1815, when a currency adequate to the wants of the nation was supplied for its necessities, and our rulers had not yet embraced the principle that, in proportion as you increase the work men have to do, and enlarge their number, you should diminish their food. It was the period when Mr Pitt or his successors in principle were at the helm. Three commercial crises came on at that time, all occasioned by the abstraction of specie for the use of the great armies then contending on the Continent,—those of 1793, 1797, and 1810. In the first, the panic was stopped by Mr Pitt's advance of £5,000,000 exchequer bills; in the second, by the suspension of cash payments; in the third, when gold was so scarce that the guinea was selling for twenty-five shillings, by the issue of bank-notes to the extent of £48,000,000. That last period, which under the present system would at once have ruined the nation, was coincident with its highest prosperity: with the Torres Vedras campaign, and a revenue raised by taxes of £65,000,000 yearly. All the panics on record have arisen from the abstraction of gold in large quantities, and have been cured by the issue, sometimes speedy, sometimes tardy, of a corresponding amount of paper. Sir R. Peel's policy doubles the evil, for it at once sends abroad the cash under his act of 1846, even in the finest seasons, to buy grain, and, under the act of 1844, at the very same moment contracts the currency, by the increase of which alone the evil could be remedied.

Sir R. Peel, however, has completely, as already noticed, instructed us in the true principles of the currency. It is his policy which has brought them to light. He contracts the currency when gold is scarce, and expands it when it is abundant. The true principle is just the reverse: it is to contract the paper when gold is abundant, and an expansion of the currency is therefore little needed: and to expand it when it is scarce, and therefore an addition to it is imperatively called for. The price of gold will at once tell when the one or the other requires to be done.

We conclude in the words we used on this day twenty-two years, on Jan. 1, 1826, immediately after the cessation of the dreadful panic of December 1825:—"It may be that the Ministry is right, and that all these changes are wise and necessary, but we cannot discover it. The more accurately we examine, the more firmly we are convinced of the truth of our own opinions. Time has brought no refutation to us, whatever it may have done to those from whom we differ; in so far as experiment has gone, we may point to it in triumph in confirmation of our principles and predictions. If at the last we be proved to be in error, we shall at least have the consolation of knowing that we have not erred from apostasy; that we have not erred in broaching new doctrines and schemes, and supporting innovation and subversion; that we have not erred in company with the infidel and revolutionist,—with the enemies of God and man. We shall have the consolation of knowing that we have erred in following the parents of England's greatness,—in defending that under which we have become the first of nations, and in protecting the fairest fabric that ever was raised under the face of heaven, to dispense freedom and happiness to our species. Our error will bring us no infamy, and it will sit lightly on our ashes when we shall be no more!"