us; and the distress the want of silver must occasion to our manufacturers, labourers, small retailers, and all the lesser transactions of trade and business, I need not expatiate upon.

"But this is not our only calamity: unfortunately, the value of the new species of Portugal gold has been so settled, that there is 2d. profit in bringing over a £4. piece, as we call the larger pieces of Portugal gold, rather than two 40s. pieces; and 2d. profit in bringing over a 40s. piece, rather than two 20s. pieces; and so on with respect to the silver pieces of that species: besides which, as the least want of weight in the foreign pieces of gold, or even their not turning the scale, carries an abatement of 2d. a piece, there may be a loss of 2d. on every lesser piece on that amount; and, consequently, so much the greater as the number of smaller pieces is to make up a greater of the same value, that is, upon eight 10s. pieces, there may be a loss of eight 2d.'s, if the eight 10s. pieces do not turn the scale: so that it is to the profit of the merchant to import the larger pieces of gold rather than the smaller and they have gone on in using this advantage, till half the money we have, at least, is in £4. pieces, which are of no service in the market, and in all lesser transactions of trade: and the next species with us is the 40s. pieces: and to be sure, above three quarters of our money is in those two species; and, without some remedy, we shall, in two or three years, have scarce any money but £4. pieces.

"There is another inconvenience that follows from our scarcity of silver; that we suffer from 2 to 24 per cent. in the exchange; and are really paid so much less in the price of what we sell to foreign merchants, and lose so much in paying for what goods we buy from abroad.

"And it is certain, that all the noblemen and gentlemen of this country, who live in England, lose from 2 to 2 per cent. in the remittances of their money. to England, which is used as a popular argument against the proposed reduction ; that the absentees will get so much per cent. by it, while they will not consider that the nation at present loses five times as much in the export and import of goods, as the absentee will gain by this reduction of the exchange.'

To remedy this evil, various schemes were offered to government, and many curious dissertations were written; but it was at last thought expedient, that the gold and silver should be brought nearly to a par, by lowering the value of the former. Great opposition appears to have been made to this reduction by the Irish bankers, and remitters of money, as the inequality of gold and silver proved a great source of profit to those through whose hands the money of the nation passed. The measure, however, was finally settled; and a proclamation on the subject was issued by the lords justices and council, on the 29th of September, 1737. By this proclama

• Boulter's Letters, vol. ii. p. 124.

tion, the value of the English guinea was fixed at £1. 2s. 9d., and that of the halfguinea at 11s. 44d.; the moidore was to pass for £1. 9s. 3d., the half for 14s. 8d.; the Spanish or French double pistole for £1. 16s. 6d., and the French louis-d'or of the new species for £1. 2s.

"This regulation," says Simon, "was, no doubt, intended for the good of the kingdom, and established with no other view than to keep at home the silver current in the country; but experience has shewn, that those who laid the scheme were mistaken in its consequences. We have, indeed, guineas in greater plenty than we had before, but generally so light, that whoever has a hundred of them, and thinks to have £113. 15s. intrinsic value, will often find, if he weighs them, that he has not, in fact, above the value of £106. 5s. at a moderate medium; whereas, if, before the reduction of the gold, he had an hundred moidores of full weight, he was sure to have £150., or, at least, £144. 11s. 8d., if, according to Sir Isaac Newton's tables, they be intrinsically worth 27s. 9d. English, which, in Irish money, is 29s. 11d.; he could, therefore, lose but £5. 8s. 4d. on his £150.; whereas he loses £7. 10s. on his hundred light guineas, and £34. 12s. 3d., at a moderate medium, of the real intrinsic value of the silver, if he keeps £150. in such English shillings and sixpenny pieces as are mostly current at present here."

"The scheme proposed by some others," continues he, "was, as I take it, much better adapted to the circumstances of Ireland; I mean, the raising the value of the silver species formerly current in this kingdom to a par with that of the gold; had this been done, it would have prevented the melting of the silver, which is daily wrought into plate, or transported abroad. This mischief is grown to such a pitch, that a new or well-preserved crown, or half-crown, is become a great rarity, even among the curious: they no sooner appear than they disappear. What silver is now left, is some English money not worth melting; shilling pieces hardly worth ninepence or ten-pence, and sixpenny pieces not worth a groat.

"This must continue to be the case, while silver is under-rated here, and passes at less value than in England, where bullion is sold, at a medium, at 5s. 6d. the ounce, and here, among the goldsmiths, at 5s. 9d.; so that, at a moderate computation, there is, at least 2s. 6d. or 2s. 8d. profit, in about every fifteen ounces of bullion sent abroad, which, together with under valuation of the crown silver, makes a difference of £7. 1s. 9d. per cent.* "All these difficulties," says Mr. Prior, in his excellent discourse of coins, "would be effectually removed, by having a mint established in Ireland, and several species of copper, silver, and gold coins, made of such a standard weight and value, compared with the English standard, as should be thought proper and convenient for us."+

It appears, by the preceding short view of the system pursued by the English

government, in regard to the metallic circulating medium of Ireland, that in few countries in Europe has money been subjected to more changes in the same period, either by the admixture of bad metal, or by alterations made in the nominal value of the different coins of which it was composed. Such variations are attended with the most pernicious consequences to a state; and are a proof, either that those who have recourse to measures of this kind hold honesty in very little estimation, or, that they are unacquainted with the true principles of political economy. "The right of coining money," says Bielfield, "has been granted to sovereigns only, because, being at the head of the state, and fathers of their country, it was supposed, and with justice, that they are more interested than others, and have a greater desire to observe the most scrupulous probity in that operation, and to take care that the impression on each piece of gold or silver shall denote no other value than that which it really has, especially as he who deceives his subjects in this respect, deceives himself. Hence, the reason why all pieces of money, whether large or small, must be struck with the impression and arms of the sovereign, who thus marks its just value, and gives it currency and authority, to serve as a fixed price for things of unequal value. The least reflection on these incontestible principles will shew how stupid, or base, that financier must have been, who first advised his sovereign to adulterate money, to stamp it with an impression denoting that it contained more than its real value, to defraud his people and others, and to sacrifice his own good faith, an object of so delicate a nature to a sovereign; in order to convert mintage into a source of finance, and the means of accumulating riches. By this dishonesty, the common measure or price of any thing is rendered uncertain; the nation, or rather the prince, who coins base money, pays the double of what he gains by this mean fraud as soon as it is detected by others. To shorten the yard, lessen measures, falsify weights, or to alter money, is, at bottom, the same kind of

manœuvre."

"There are three ways of altering money at the expense of the public, and of rendering uncertain that common measure, which sound policy, if possible, would fix and render invariable for ever. The first is, when the sovereign detracts some part from the weight which a coin ought to have: this expedient is so clumsy, that the subject, as well as foreign nations, are soon aware of it, and never become its dupes. The second method consists in altering the quality or fineness of the metal, by lessening its intrinsic value; that is, taking from a gold or silver coin a certain part of the weight which it ought to have, and supplying its place by a mixture of alloy this fraud is of a more complex nature, and more difficult to be discovered, but it is so common, that it never escapes the acuteness of polished nations. The third method is, when, in cases of urgent necessity, or on account of some foreign cause, the nominal value of money is suddenly raised, and, by an arbitrary act of

sovereign authority, made to pass, in the course of trade, for more than that at which it was coined."*

All these methods are injurious to the states which make use of them; yet numerous instances occur in history of their having been adopted, not only by bad or weak princes, but even by some who have been extolled as patterns for the imitation of sovereigns. On various occasions, republican states, as well as those under kingly government, have had recourse to this expedient, in consequence of the necessitous situation of their finances. The Roman denárius passed for ten asses; but government, being greatly distressed for want of money, in the war with Hannibal, raised it to the nominal value of sixteen, by which they defrauded their creditors of six in that number: being afraid, however, to offend the army, the of the soldiers was issued at the former rate of currency.+

pay

Similar instances occur in the history of France, whose sovereigns appear to have had very little delicacy on this head, when urged by want, or when they supposed it suited their convenience. Philip I. is said to have mixed a third of allay in Charlemagne's pound of silver, which weighed twelve ounces; and to have given the name of livre to a pound in weight, which contained only eight ounces of silver; yet he conceived that his pound was equal to that of his predecessors. The same ruinous system seems to have been frequently pursued; and even so late as 1716, when the principles of political economy ought to have been much better known. The duke of Orleans, who was then regent, during the minority of Louis XV., raised the value of the louis-d'or from sixteen to twenty livres, and of a crown from three and a half, and four livres, to five. In this manner he gained one-fifth of the value of these coins; while the deluded people were made to believe that they were no losers, as they received back from the mint the same number of livres which they paid in, though in reality they received back four ounces of silver instead of five. Persons of more acuteness, however, soon discovered the deception; and the consequence was, that large quantities of the old species were hoarded up, which occasioned a considerable obstruction to commercial transactions. To remedy this evil, recourse was had to the establishment of a general bank; the bills issued by which bore an interest of five per cent.: the bank paid only in the new specie, although they received both old and new; and, as the coins were so fluctuating in value, and the bank bills invariable, people carried all their money to the bank. This was a sufficient temptation to the regent, to seize on so large a treasure, which he accordingly did, and the result was, that the bank suddenly stopped payment ;

Institutions Politiques par le Baron de Bielfield, t. i. p. 475, 477.

+ This was not the only time the Romans had recourse to this expedient. See Plin. Hist. Nat. Lugd. Bat. 1669. p. 451.

VOL. II.

+ Traité d'Economie Politique, par J. B. Say, t. i. p. 451.

Y

although it is asserted, that the gold and silver coin in France at that time, amounted to 400 millions of livres, or about seventeen millions sterling.*.

-Even the great Frederick, notwithstanding his political wisdom, which has been so much the theme of praise, adopted the same method, when reduced to great straits, at the beginning of the seven years' war. At first, as is sometimes the case, he derived considerable advantage from it among his own subjects, and in the newly-conquered province of Saxony, where the deception was not well understood; but as it became known, and as the price of articles was thus raised, he found himself reduced to the necessity of repeating the fraud, and of successively issuing money of an inferior value.+

Between the period last mentioned, that is, the year 1737, and the union of the two kingdoms, there is little worthy of notice which seems to have taken place on the subject of the circulating medium of Ireland. As no public bank was established in that country till 1783, its paper currency was in the hands of private bankers; who sometimes issued notes to an amount, not only far beyond their capitals, but exceeding, in a great degree, what the wants of the country required, or her credit could support. This was the case, in particular, in the years 1754 and 1755, in which three of the principal banks failed; and as there were then no bankrupt laws. in Ireland, the creditors were obliged to apply to the legislature for reliéf, which was granted by special acts passed for that purpose.

During the years 1778 and 1779, the exchange of Dublin on London varied from 5 to 7 on the 27th of October, in the latter year, it was at 64. This was considered remarkably low, and the following causes were assigned for its being so much

* Macpherson's Annals of Commerce; vol. iii. p. 50. Voltaire, in his history of Louis XIV., has made some excellent strictures upon changing the value of the denominations of money.

+ Abhandlung von dem Geldumlauf, von J. G. Büsch, Hamburgh und Kiel, 1800, vol. i. p. 270.

1

An ingenious writer on political economy, says, "that kings who have begun to debase the standard ought to go regularly on every year, as long as they find themselves in the state of debtors; and when they come to alter their situation, and become of the class of creditors, it is then their interest to raise the standard." An Inquiry into the Principles of Political Economy, by Sir James Steuart, 4to, edit. vol. ii. p. 65. The real inconveniences which proceed from this exercise of power may be reduced to three :

1st. It disturbs the ideas of a whole nation, with regard to value, and gives an advantage in all bargains to those of the society who calculate, over those who cannot.

2d. It robs the whole class of debtors when the standard is raised; and it robs the whole class of creditors when it is debased.

3d. It ruins credit; because no man will borrow or lend, in a country where he cannot be sure of receiving back the value of his loan; or of being in a capacity of clearing himself, by paying back the value he had borrowed. Ibid. p. 67.

Commercial Restraints of Ireland considered, p. 53. Some acts had been passed before for a similar purpose; as 5 Geo. II. ch. 23, for the relief of the creditors of James Meade and George Curtis, bankers, and 7 Geo. II. ch. 26, for the relief of the creditors of Samuel Burton and Daniel Falkener, and the other bankers therein named. Statute Law of Ireland, by Edward Lee, Esq. Barrister at Law, Dublin, 1734, p. 320.