There may be danger in high-flown and exaggerated statements with respect to the finances of the country, as in the case of the honourable Bank director who on a former occasion spoke of a "passing cloud," and of the hon. Member for Sunderland, who indulged in another and a stronger metaphor; but there is no danger in telling the simple truth—namely, that the Commercial Crisis which has occurred, but which, I hope, is now rapidly passing away, has produced a temporary pressure and inconvenience; but there is nothing, and has been nothing, in that pressure and inconvenience which ought to make a man of reasonable firmness and courage consider that any portion of the main resources of this country are in any the slightest degree permanently compromised or affected.
It was perfectly true, as the hon. Member had stated, and indeed it was nothing but repeating what he had stated on a recent occasion, namely, that it was impossible for a Great Commercial Crisis like that through which this country had passed to occur without affecting the public revenue.
The Commercial Crisis through which the country had lately gone, and which had shown itself in the state of the revenue, had not led to the same calamities as those exhibited in 1825; and, considered in all its bearings, its mitigated effect might be said to have arisen from the great augmentation of the resources of the country, from greater preparation in meeting the pressure, and from the country being in possession of more wealth and more capital.
This was evident from the effects that the proceedings of General Jackson in the United States had had on our financial proceedings; for it caused such a run on the Bank of England that it reduced the amount of the precious metals in its coffers to about four millions; and if the run had gone on but a short time longer it would have caused a panic, and no doubt would have led to a Commercial Crisis, attendant with all its evil consequences.
The noble Lord, the Secretary for the Colonies, had told them, the other night, that this was a Great Commercial Crisis; but he trusted, that the House would permit him to contrast with this declaration of the noble Lord a declaration made by one of his noble Colleagues last year, when defending him- 124 self against a charge brought against him by an hon. Friend of his for not having exercised his influence sufficiently on the behalf of the interests of British commerce.
But, when the right hon. Gentleman talks despondingly of a Commercial Crisis, I ask the House and her Majesty's Government to look to the unsettled state of commerce in America for an explanation of it—to look to our recently disturbed relations with that country, I will not say now by whom caused, but which, so long as they continue, must cramp our commercial relations with our best customers—to look to the uncertain state of the East—to the unsettled condition of Syria, to the troubled state of our Indian empire, to the loss of three millions to our merchants in the shape of opium seized at Canton—to the far from amicable state of our relations with China.
It is admitted on all hands, even by themselves, that a Great Commercial Crisis has arrived— that it is the duty, not only of the Government, but of the House also, to provide some mode by which to meet that difficulty.
In connection with the political difficulties which had arisen came a Great Commercial Crisis, and both of these difficult questions it became the duty of the present Ministry to consider.
He admitted that there were, however, serious signs of a Commercial Crisis, which would, according to our present monetary system, be followed by greater monetary difficulties.
As the Motion stands now, it would introduce into the consideration of the question before the Committee any subject which any hon. Member might conceive to be the cause of the Recent Commercial Crisis.
When the noble Lord the Member for Lynn had spoken of the large importations of corn as one of the causes of the Present Commercial Crisis, he did not understand him as expressing any regret at that importation, because the failure of the potato crop, and the circumstances of the country, rendered it necessary; but the 448 noble Lord had very justly remarked, how much they had become indebted to foreign countries by the importation of other articles for which the same necessity had not existed.
The Chancellor of the Exchequer had told them to-night—although the right hon. Gentleman had used other and contrary language on a former occasion—that he did not attribute the Commercial Crisis of 1847 either to the conduct of the Bank of England, or to the operation of the Act of 1844.
And let it be remembered, that by their monetary system, they had bound themselves under the penalty of a Commercial Crisis not to allow the balance of trade to be to any considerable extent, or for any lengthened period, against this country.
I ask those Members of the House who investigated the causes of the Commercial Crisis under which the nation was so deeply suffering when this Parliament was assembled in 1847, whether it is not the case, that the failure of joint-stock banks was one of the most important causes of that most fatal event?
For in these days the capital of the country had such a tendency to increase, that it became rapidly too great to find profitable employment, and was from time to time carried off, sometimes by the terrible event of a Commercial Crisis; at others, finding no outlet at home, by being sent abroad, and employed in other lands.
The Chancellor of the Exchequer had told him that, under this system, the bullion at one time in the Bank amounted to £20,000,000, and when to this was added the £14,000,000 of notes on securities the effect of such an accumulation was to raise great expectations in the country, to inflate prices, give encouragement to speculation and the creation of new companies, all which was sure to be followed by a Commercial Crisis, and thus drive the country from one extreme to another.
A Commercial Crisis had happened, and the hearths of the people of Ireland had been desolated by a 1113 gigantic famine.
He came from a part of the country which had suffered deeply from the Recent Commercial Crisis, and it was due to those unfortunate persons who had been brought, as he feared, to irretrievable ruin, and to the whole body of the commercial world, that the causes of these events should be carefully inquired into.
My right hon. Friend thinks it is better to reappoint the Committee than to legislate, and his reasons for that course, as I understand them, are these two; first, that you have got a Committee with an incomplete inquiry, which has recommended that it should be re-appointed; and, secondly, that at a time when men's minds are warm and smarting under the Commercial Crisis we could not expect the fruits of wholesome legislation.
I re-member before the passing of that Act asking a friend of mine who was very well 211 conversant with these subjects, the late Lord Sydenham, what ought to be done if we had a Commercial Crisis and a state of discredit.
They must, therefore, regard the Commercial Crisis as one that had arisen from causes affecting credit, and not at all connected with currency.
Having adverted to the Indemnity Bill, I may perhaps be allowed to call the attention of the House to the fact that, although I did not venture to give any positive assurance that the Commercial Crisis had reached its termination, nevertheless I expressed confidence that the Bank of England was steadily recovering its position.
I accept that opinion of the right hon. Gentleman, but he will allow me to remind him that he is the first Minister who ever made such an admission in a Commercial Crisis.
and if a third Committee were appointed on that subject, the Committee on the Commercial Crisis would be in a like manner precluded from entering upon another of its alleged causes.
Everything seemed to be 1386 progressing satisfactorily; Mr. Stephenson, with an adequate staff of officers, was again despatched to India, when the Great Commercial Crisis occurred in August.
Let the hon. Gentleman, instead of recommending his constituents to emigrate, bring his powerful mind to bear upon the question why we were exposed every ten years to a Commercial Crisis.
He would not stop to inquire whether the circumstances of 1858 were parallel to the circumstances of 1860, or whether measures, which were justifiable when the country was slowly recovering from the effects of a very Serious Commercial Crisis, could in any way be justified when it was admitted that the country was in a state of unexampled prosperity.
The year 1855–6 was a year of war; 1856–7 was a year of war expenditure; 1857–8 witnessed a Great Commercial Crisis, and it was upon an average of those years that Schedule D was paid in 1860.
At the end of which time, namely, 1825, Another Commercial Crisis took place, producing a general distress and discontent which produced the agitation for the Reform Bill in 1830.
In times of difficulty, if a Commercial Crisis should occur, and a run was made on the savings hanks deposits, the scheme would probably be entirely in abeyance.
The Bank Returns in the three years after the Commercial Crisis showed that there were only £7,250,000 of notes unemployed, and of that amount £4,000,000 consisted of reserves of bankers.
His hon. Friend the Secretary to the Poor Law Board had, no doubt, to a considerable extent accounted for the increase of pauperism by the Commercial Crisis of 1866.
We are not at war; we have not had a Commercial Crisis.
And that brought him to the great national danger which, in his opinion, existed, of holding these vast sums of money payable on demand, and the consequent necessity of having to meet the demand in money, no matter what might be the Commercial Crisis through which the country was passing; and he desired to express the desire to see, if not at once, at a very early date, an alteration in this respect.
The quotation refers to my native town; and he says, speaking of the time from 1836 and 1840— "Bolton, a town of the second class in Lancashire, near Manchester, containing about 50,000 people, had been thrown by the Commercial Crisis into a condition of utter misery.
Therefore, if silver had not been demonetized we should not have suffered from the Great Commercial Crisis through which we were now passing.
These cases are capable of being multiplied to an indefinite extent, just as accommodation bills increase on the eve of a Commercial Crisis.
BARTLEY said, that if the funds of all Trades Unions were to be 1163 put in the Post Office Savings Bank if there came a Great Commercial Crisis and a general strike there would be an enormous demand on the Exchequer, and the Government would be put into a serious difficulty to meet the demand for funds.
I do not ask any man to change these except for good cause; but I do express my own most serious belief that we are face to face with a financial, an agricultural, and a Commercial Crisis which does require us to consider anew and in the light of the best opinions all the circumstances affecting our social condition, and it is only if we are prepared to give ourselves freely to this laborious research that we can hope to arrive at any conclusion which would benefit the great interests which are committed to our charge.
The Banks had failed in Newfoundland, and there had been a Commercial Crisis similar to those through which the Australian Colonies had passed from time to time.
How much would that do for a country like this, which was in the throes of a Great Commercial Crisis?
Then the only question is, supposing the introduction of Chinese labour would really; meet the difficulty, whether the remedy is not worse than the disease—whether, in other words, it is our business to compel the Transvaal to undergo a great 347 Commercial Crisis rather than admit the Chinese under the conditions proposed by my right hon. friend who sits near me.
It might be useful as a unifying element where, in the case of a great volume of trade, the destruction of it meant a Grave Commercial Crisis, but it operated only to stop actual disruption.
The Amendment would enable the Home Secretary, by giving collieries power to work longer at such a time of Commercial Crisis, to come to the assistance of the general public by suspending the Act for a limited time.
HERBERT SAMUEL: The hon. Member said that a rise in the price of coal would be a symptom of Grave Commercial Crisis.
In these circumstances, even with the completest control of the sea which you could imagine, you could not abolish the trade, although, no doubt, you might annoy and irritate and handicap the trade of Germany, and might even produce a Commercial Crisis and a good deal of suffering.
Many years ago when we were faced with a Commercial Crisis the great American writer Emerson, who was then visiting this country, declared: "I see her not dispirited, not weak but well remembering that she has seen dark days before; indeed with a kind of instinct that she sees a little better in a cloudy day, and that in storm of battle and calamity she has a secret vigour and a pulse like a cannon.
I think it would have been impossible to face a Commercial Crisis and a banking crisis simultaneously.
But there is some danger where co-operatives are created out of economic adversity, for the situation is then one of Commercial Crisis and, important through the rescue may be on general grounds, it is far from an ideal basis on which to promote the reputation of co-operatives generally, or of Co-operation as an alternative form of organisation.