farmer, spread dismay and disaster over the whole kingdom. Let that country circulation be restored, and general prosperity will again return to us. But that restoration is perfectly inconsistent with the idea of a currency in coin.

The real nature of a paper circulation, it is next proper briefly to explain.'

A bank note was formerly considered to be, " A promise to pay, on demand, a certain quantity of gold or silver.' All the clamor against an exclusive paper circulation, is founded upon that exploded idea. A bank note is now merely "a token on paper, representing solid property, circulated under the sanction of a public stamp, and entitling the possessor thereof to receive credit or value, or to pay any taxes to which he is liable, in proportion to the sum engraved upon it.

Such tokens, when issued on proper principles, represent capital, or property, as much as if they were convertible into coin; and they will always pass current from one individual to another, if retained within due bounds.2

It is objected to an exclusive paper circulation, that the exchange might become unfavorable. But this is no disadvantage, when it is not necessary to import the precious metals, for it tends to promote the export of our manufactures, to pay the balance of trade. At any rate, any mischief that could thence arise, would be amply compensated by our not being under the necessity of exporting forty millions of solid property, for the sake of importing forty millions (if they could be had), of such useless commodities as gold and silver, which furnish none of the real necessaries of life, food, clothing, or shelter.

It is only necessary to add, that an exclusive paper circulation was the ladder on which we rose to the greatest height of prosperity and power that ever a nation enjoyed; and if we cut down that ladder, we shall rue the fatal consequences resulting from it, when alas! it will be too late. We shall be thrown into a state of fluctuation and uncertainty-depending upon the manoeuvres of

- It might be of use, perhaps, to have gold tokens, of ten shillings' value circulated by the bank, with such a quantity of alloy as would prevent their being melted down; and three-penny silver pieces would likewise be convenient.

2 When small five shilling bank notes were prohibited some years ago, the late Mr. Wilkinson, an opulent iron manufacturer, found the greatest difficulty in procuring small coin for the daily or weekly payment of his workmen; on which it was recommended to him to issue paper tokens, containing an obligation to deliver a certain quantity of iron at a given price. This he did, to the extent of about one thousand pounds. Bank notes are merely tokens of the same description, for the delivery, not of iron, but of any other commodity that may be required.

jobbers in coin;-trembling at every increase in the price of gold, or in the rate of exchange; and every instant dreading some impending national calamity, under the apprehension of which no branch of industry can florish, while in the conflict of contending interests that pillar of strength, our public credit, runs every risk of being destroyed.

POLITICAL MAXIMS.

BY SIR JOHN SINCLAIR.

THE three greatest political discoveries, in modern times, are these:

1. That coin is nothing but circulating capital, and that when real property, or capital, can be circulated through the medium of paper, though not convertible into specie, it answers every purpose of coin, while the expense of purchasing the precious metals from foreign countries is thereby saved. It is essential, however, that the paper thus circulated, should represent real, and not fictitious property;-that it should be kept within due bounds: -and that it should be receivable in the payment of taxes, and all other legal obligations.

2. That it is incumbent on the government of every country to furnish its subjects with employment, so as to enable them to procure food and other articles necessary for their comfortable subsistence. Fortunately, that duty can easily be fulfilled, for it re

The price of gold has risen to 4l. 1s., or 6d. additional per ounce, since this paper was sent to the press.

2 The advantage of a paper over a coin circulation, may be thus shortly stated. Gold and silver represent property actually sent abroad, and in the possession of foreign nations: whereas paper money, when issued on proper principles, represents property at home and in our possession.-History of the Revenue, vol. ii. p. 327.

quires nothing, on the part of government, but to promote abundant circulation. When a circulating medium abounds, more especially if it consists of paper, (which is not so likely to be hoarded up as coin,) it will be employed, and in the course of its circulation it will furnish the means of subsistence to every industrious individual.

8. That it ought to be a principal object with every government, to provide the country districts with an abundant circulation, through the medium of country bankers, established on a footing of security. It is by the means of a country circulation alone, that improvements in agriculture can be carried on with spirit; that the produce of the soil, the real basis of national wealth and industry, can be increased; and that the farmer, the first link in the chain of national circulation, can be provided with a circulating medium, which, through him, will soon pervade all the other classes of the community.

By the system developed in these Maxims, Great Britain reached that pinnacle of power and prosperity, which she attained during the late war; and the more strictly she shall adhere to the princi ples therein laid down, the more likely she is AT HOME to be happy and prosperous, and ABROAD to be great and powerful.

ON

THE APPROACHING CRISIS,

&c. &c.

THERE never was a period, when Great Britain possessed so

favorable an opportunity of reaching an unparalleled degree of internal prosperity, as at the present moment. After suffering the severest distresses, she begins again to breathe, and to indulge the hopes of a happier æra. But that æra must be looked for in vain, unless she shall persevere in that system of circulation, under which she so eminently florished, and by which alone she was enabled to extricate herself from difficulties, which otherwise she could not have surmounted.

It is not proposed in this work to discuss the question, whether cash payments at the bank should or should not EVER be resumed. That would be entering into a wide field, not necessary now to dwell on. It is sufficient to remark, that the system of exclusive paper circulation has been productive of infinite public advantages, without being attended with any inconvenience whatever. The hazardous consequences which may result from changing a system thus sanctioned by the successful experience of twenty years, must be obvious. Indeed, if an attempt to alter the system were made, there is too much reason to apprehend that the Italian proverb would be found applicable to our fate-" I was well;—would be better;-took physic; here I am." "

I

Before that fatal step shall be finally resolved upon, it is earnestly requested that the following points be duly considered by Stavo ben;-Ma per;-Star meglio;-Sto qui.

those to whom the complicated interests of this great country are intrusted.

1. Whether it is practicable to resume payments in cash, in July next, 1818?

2. Whether such a resumption be consistent with the principles of justice?

3. If a resumption be desirable, at what period can payments in cash be resumed with safety? and,

4. What ought to be done in the interim, with the profits arising from the issue of bank notes beyond the amount of the bank circulation, when its paper is convertible into coin?

1.

Is it practicable to resume payments in cash in July 1818?

The propriety of resuming payments in cash must depend upon three circumstances: 1. A favorable state of exchange;~2. A low price of gold, if that is to be continued the standard of value ;-and; 3. The possibility of amassing so much gold as may be demanded by the public.

1. It is well known, that for some time past the state of the exchange with France and Italy has been unfavorable to this country, and the consequence is, that great quantities of the gold issued by the bank have been exported to the continent.-It is a fact publicly asserted, and which has never been contradicted, that Jews were daily lurking about the bank, who would give twenty shillings and four-pence for "the new-coined sovereigns," to be sent to Paris, where they got into general circulation at the price of 17. 2s. 1d.;-nay, that a premium could be had for those notes which were exchangeable at the bank for coin. Can there be a more decisive proof of the hazard that would attend a general power of converting bank-notes into gold?

'The following estimate of the profits to be derived by exporting gold during the present course of exchange, is given in the St. James's Chronicle of the 17th January.

Price of gold in bars,

4 0 6

Additional profit of exchange on exporting sovereigns to Paris, 0 1 6

To this sum 6d. per ounce in the price of gold is now to be added.