of country banks which the crash of 1825 occasioned, and which the legislature unfortunately took no measures to counteract by placing, or even allowing these establishments to place themselves, on a sounder footing. Another very large quantity of sovereigns is, no doubt, removed from active circulation, and hoarded, by persons who, from a similar distrust in bank notes, and the generally inadequate returns for the employment of capital, prefer keeping a deposit of gold by them, to be secure against all contingencies. This feeling is prevalent to a great extent in country districts, and will account for much of the immense quantity of bullion said to be in circulation. 'But, whatever objects the holders may have in view, the fact remains clear, that there are actually twenty-eight millions of gold absorbed by the wants of the country. It is also evident, that the absorption of this enormous amount of gold can only be owing to one or both of two causes; viz. 1. The effect of the act of 1826, the withdrawal of small notes necessitating the substitution of gold for the purpose of change; and, 2. The general distrust of paper, owing to the extraordinary omission of the legislature of that year to provide for giving real security to bankers' issues, the want of which had been so forcibly demonstrated by the occurrences of the preceding year. Instead of acting on the knowledge that the panic and dangers of 1825 had been owing to the law which prevents banks from being established in England on such a footing as may effectually secure them from failure, or the dread of it, parliament not only left the country banks just as insecure as before, but actually did its utmost to destroy the small remnant of confidence the public were likely to retain for their issues after the crash of 1825; made it apparently a study, both in the speeches of its members, and the tone of the measure of 1826, to heap all possible obloquy on these establishments, while continuing a law which took from them all power of improving their condition; utterly unconscious of what a moment's consideration would have shown to be the necessary result of such proceedings, namely, a demand on the part of the country for gold to an enormous amount, in preference to this vilified and unquestionably insecure paper. It is, then, to the legislation of 1826-to that which was done, coupled with what was left undone, that is, in my opinion, solely owing whatever demand for bullion has shown itself since that date. Now what may this be? Of the actual twenty-eight millions of gold, how much are we to believe to have been in circulation previous to 1826? Suppose there were even as much as eight; this will leave twenty millions as the additional quantity of gold required and absorbed by the wants of the country since 1826. Now does any one suppose that a demand for twenty millions of gold, to be provided within three years, in addition to the usual demand for other purposes, will not raise the value of gold all over the world? It would be idle to attempt to guess at the quantity of gold available available for purchase in the civilized world. But twenty millions of sovereigns must make a very large hole in it. Moreover, the additional quantity of gold required must have been purchased abroad by English capital to that amount. If this large sum came from the pockets of the unproductive classes, as would have happened if it had been laid out on foreign products for their consumption, it would have been no further loss to the country at large; but, being compulsorily expended by the classes engaged in production, upon a circulating medium with which to carry on their transactions, it was a sacrifice that fell irredeemably upon them. It is an abstraction of so much from the capital annually employed by them in production; of such a portion of capital as would otherwise have afforded a profit to its owners, and employment to perhaps a million of labourers at fair weekly wages, and a decent maintenance, reckoning the families of the latter at an average of five, to five millions of souls! But in the complicated transactions of this great commercial empire, there will always be an immense mass of outstanding money engagements, bills, debts, and contracts. The rise of one-fourth in the value of money added, of course, as much to the real value of every money engagement, including the public debt and the expenses of government; while, on the other hand, the subtraction of twentyfour millions from the productively employed capital of the country, in order to purchase a metallic circulation, reduced, in perhaps an equal degree, the returns to its industry, out of which all these heavy money engagements must be paid, before the capitalist, manufacturer, farmer, or tradesman can put one shilling into his pocket! The state of the currency since 1826 may, therefore, be justly and strictly described as "A legislative contrivance for diminishing the returns of the productive industry of the country, and at the same time increasing the charges upon it, public as well as private." That distress, general and severe, should be the result, is no more surprising than that Sangrado's patients should have sunk under a very similar treatment, by which their veins were exhausted and their diet lowered at the same time; no more surprising than that a farmer should be ruined by an increase of rent coming upon him simultaneously with a fall in the price of his produce. This is, in fact, one out of the many ways in which the measure has affected all classes of producers.'p. 14-21. We still hope that the facts and arguments of this clear and energetic pamphlet may meet, ere the session of parliament closes with that attention which they so well deserve. The great talents and acquirements of Mr. Scrope have been exhibited in many previous productions ;-but we do not hesitate to pronounce this the most valuable tract that has ever proceeded from his pen. ART ART. VIII.-On Financial Reform. By Sir Henry Parnell, Bart. London. Α 1830. LTHOUGH Mr. Canning's Finance Committee did not itself yield much of the expected fruits, those who during the ensuing triennium have been entrusted with his Majesty's treasury have certainly made considerable exertions to second its efforts. Year by year there have been reduced in our public expenditure, five, two, and lastly, in the present session of parliament, no less than twelve hundred thousand pounds. The linen bounties, a heavy charge, have been prospectively abolished; a mittee of the Commons has examined and reduced the Irish miscellaneous estimates; a commission has reviewed our public accounts; and a uniform system will be forthwith established in the books of all our government offices,-by which revolution, moreover, the ancient controlling power will be restored to the Treasury. By a fair arrangement, a large number of our soldiers have, in the last year, been prevailed on to forego their expectant claims on the dead weight of the army; while the civil servants of the crown have been, without injustice, provided for in old age by a deduction from their active stipends. Many posts of doubtful use, when vacated, have been permitted to lapse; and, on the other hand, former servants of the public have, in many cases, received working appointments in exchange for their retired allowances,-patronage being thus doubly sacrificed to public economy. Finally, the Chancellor of the Exchequer has lately plighted his faith in parliament that a committee of official persons (the most powerful arm of retrenchment when the will is there to wield it) should inquire into the items of further reduction, and should specially direct its attention to our colonial expenditure. It The reports of a parliamentary committee are, it is well known, drawn up by the chairman. Four such statements issued from that body which lately sat on Finance. To these Sir Henry Parnell may now be said to have added a fifth, unstamped by his colleagues' assent, a small volume entitled Financial Reform. may be called a century of suggestions for diminishing the weight of taxation. It is a rapid survey, clear, on the whole, ingenious, and diversified. On the other hand, this book is what our German neighbours call one-sided. All our great national interests come under its view, but are regarded chiefly, and therefore defectively, on their fiscal side. Hence we oftener agree in our author's finance than in his political economy; while of politics he appears to us to have altogether lost sight. His remedial propositions are many,-we will mention the principal. He would repeal repeal the taxes on raw materials, such as bricks, timber, and soap; on British manufactures, such as paper, glass, and cottons; also, on the other hand, the protective duty which checks the import of foreign silks, gloves, lace, cloth, &c.; and he would abrogate altogether the corn-laws! These are extensive changes, truly: on the first proposition we will only observe, that where a national monopoly, entire or partial, exists, a judicious tax laid on an exported commodity, or on the raw material of which it is formed, may be derived to the national exchequer from the foreign consumer. Thus the Spaniards drew a large revenue from Mexican silver; thus the Chinese government might evidently share in the three and a-half millions which our Treasury obtains by our consumption of tea. Our own duty on exported coals is a clear gain from the foreigner. Sir Henry Parnell proposes its repeal, but surely a tax is useful which, unpaid by ourselves, checks the rapid waste of our manufacturing talisman. However, though the general principle is certain, in theory its application, without doubt, is exceedingly nice. for the repeal of protective duties, whatever may be the difference of opinion on other and minor points, we may, we believe, assume it as the doctrine of the sound thinkers on all sides, that British land, subject to such and so many peculiar burthens, has an equitable title to especial safeguards. As Another proposal (the work contains none so valuable) is the reduction of the duties on foreign spirits and on tobacco. This we must give in our author's words. The great disproportion of the duty on tobacco to the natural price of it, the circumstance of its being almost a necessary to the lowest classes of society, and the facilities the high duty holds out to illicit trading, concur in rendering it one of the most objectionable duties. As the price of tobacco, exclusive of duty, cannot be taken at more than 4d. a lb., the tax of 3s. a lb. is at the rate of 900 per cent.; and therefore, in order to withdraw this article from the hands of the smuggler, a very large reduction ought to be made. Unless reduction is carried sufficiently far on this and other articles, smuggling, and the expense of attempting to suppress it, will continue, and thus the principal object in sacrificing revenue will not be attained. A reduction of 2s. a lb. on tobacco might perhaps put a stop to the smuggling of it; but if such a reduction should be made, the loss of revenue cannot well be estimated at less than 1,500,000l. With respect to smuggling, the duties on brandy and geneva are as objectionable as that on tobacco. As the price of them, exclusive of duty, does not exceed 4s. a gallon, the duty of 22s. 6d. (I. M.) a gallon is 550 per cent. . . . . With respect to the sacrifice of revenue which would be made by reducing the duties on tobacco and spirits (three millions) in the manner now proposed, when it is taken into consi deration deration that this amount of revenue is obtained by promoting smuggling to the extent which it is now carried on, (for it is almost wholly confined to these articles,) and by incurring an annual expense of 700,000l. in attempting to suppress it, it is clear that it is impossible that such an amount of revenue could be raised by more objectionable means.'-p. 58—61. The hope of improved produce from the tobacco-duty is strengthened by the presumption that full three-fourths of the tobacco now consumed in Ireland are supplied by smuggling. Retrenchment lies within the stubborn bounds of public faith and necessity; but commutation of taxes expands as it is exercised. The relief is neither confined to the consumer of the disburthened commodity, nor to the grower or manufacturer; for when one branch of production gives a widened vent to lazy capital, the circulation is quickened in all other channels. The substitute for the indirect taxes thus diminished or removed, would, of course, be a moderate property-tax. The public desire of the relief which this tax alone can afford, grows daily it is, beyond all others, cheap in collection; and, when it is not an income-tax, the most fair in its pressure. In part, it converts the very debt of the public into a source of revenue; and, above all, it would save a portion of the treasure which our self-exiled countrymen scatter on the highways of France and of Italy. This drain of our wealth is rated, by a gentleman of great talents and experience, who has deeply examined the painful subject, as high as nine millions sterling yearly. We suspect that this estimate may be somewhat too high; but in France alone we know, by a police report of last August, that, besides 6,680 mechanics, 29,000 English men, women, and children breathed foreign air, mangled a foreign tougue, and, far from the abodes of their childhood, from their ancestors' restingplace, unlearnt, perhaps despised, the customs, the manners, the feelings, the language, and the faith of their country. If at home they would pay twenty per cent. in the weekly and monthly disbursements, could they complain if a round ten per cent. were laid upon their remittances to Paris or Naples? This levy, impossible otherwise, would be most easy under a general property-tax each income would already be known, and the customs need but return from the outports their entries of passengers; according to which, a rateable increase of income-tax might be charged on the gay defaulter, who would still, by his withdrawal, evade one-half of his due. We trust that this protecting duty on light French graces will not long be denied to those who yet hold a heavy stock of old-fashioned English honesty. If the estimate of the gentleman above-mentioned be at all near the |