What an important distinction this is, in a country where employment for labor is the one thing wanted! To devise the means of profitable occupation for the people is that problem, to solve which every aspiring statesman trims his midnight lamp, while his hoary elders look on with despairing meditation.

There are other and important objections to the extension of the Bank of England system. It is not an evil solely because by suppressing country banks it will cause capital to be drawn from the long-established occupations of industry; but it is an evil of great magnitude, because, in the practical application, its direct tendency is to produce effects exactly the opposite of those which a wise man would desire.

During the last forty years of the last century, when the laborious were attracted by the discoveries and inventions of genius to new objects, and the energies of industry were becoming more and more extended and developed, capital was the one thing needed: the directors of the Bank then withheld all assistance from the country. Now, when capital has become abundant, they endeavor to force an additional supply of it; and they force it too, where it is least required. Bills being the most convertible of all securities for loans, and affording the greatest certainty of a quick return of capital, all temporary holders of surplus money seek bills for temporary investment; consequently, there is a tendency to draw all floating capital to the seats of commerce and manufactures, where bills abound. It is in the undertakings in husbandry, and among small traders, that capital is deficient. Many farmers are prevented from cultivating their farms most advantageously, or from making any improvements on the land, because they have not money enough to buy that kind of live stock, or to raise that sort of crop, best adapted to their purpose. It is a gross fallacy, and betrays excessive ignorance of the subject, to suppose that country bankers are too prone to lend money to farmers. The return of the money being always at an uncertain, and often at a distant point of time; and there being no current transactions to render profit to bankers; there has, from the year 1815 to this moment, been a great reluctance to lend money to farmers. In those parts of the country, where agriculture and the rearing and feeding of cattle occupy the people, much money is deposited in the banks on interest; but of any given quantity of money so deposited by rich farmers and graziers, not more than one-fourth is lent by the bankers to farmers of inferior property; and the remaining three-fourths is lent to merchants, manufacturers, and traders. The great merchants and manufacturers of England are enabled, by this state of things, to borrow money in so great abundance, and on terms so easy, that they are induced to employ large sums in mining, manufacturing,

and commercial undertakings abroad. In this manner rival interests are encouraged to grow up in foreign states. Arbitrary changes in banking affairs, introduced, and threatened to be introduced, by "A bill for the further regulation of bankers," have induced bankers to draw in, gradually, much of their money from farmers, to whom they have, for a long time, lent it reluctantly; and this is thrown into great masses in London, and thence forced into those particular channels of commerce which are already too full. In this state of things, the directors of the Bank attempt to force an overflowing supply in the same channels. The effect of this combination of circumstances cannot fail to be injurious to British interests. The directors of the Bank of England, by offering to lend money on bills alone, and pushing their agents into districts where excess in the currency is always generated by means of bills, have adopted a glaring error in principle, which will lead to pernicious consequences.

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Having shown the evil tendency of the Branch Bank system in a general sense, a very few words will be sufficient to show its particular danger, local, personal, or temporary.

In a manufacturing district, it would be a great evil to have the supply of money to pay wages suddenly stopped. Yet, when the exchanges become disordered, and a great amount of gold is exported, alarm ensues. Coin is hoarded: the Bank is pressed for gold: the directors have no resource but to stop, all at once, their accommodation, from all who have sought relief and assistance from Branch Banks. They have no sympathy with individuals ; and their rule cannot be relaxed for particular cases, however urgent or distressing. The gold in their coffers must not be exhausted-a catastrophe which nothing can prevent but sealing up the conduits by which money flowed from the Bank to the public. At such a juncture, none but those who have absolute demands can get money at a Branch Bank. Works will be instantly stopped, workmen dismissed, and misery will ensue. The country bankers, at such crises, dare not hazard their reputation by refusing to continue any stipulated accommodation, or suddenly drawing in advances; but they take their own locked-up securities, and seek temporary aid from other great depositories of capital. The Bank of England can resort to no third party for relief, except the government. In times when paper circulation becomes discredited, the mere act of changing one kind of paper for another stems the demand for gold; and thus, time is gained for counteracting proceedings which will bring matters right.

Excess in paper circulation is far more likely to be promoted by Branch Banks than by country banks; partly, though not solely or principally, because their terms of business are cheaper. Seven

parts out of eight of all demands on country bankers who failed in the crisis of the year 1825-6, have been paid in full. If country banks had been suppressed before that period, and Branch Banks had existed in their places, and an equal demand for gold had prevailed, would seven out of eight parts of all demands have been paid in so short a space of time by the Bank of England, at the Mint standard? Five days of continued general demand for gold would have closed the Bank of England, or have brought out a compulsory government-paper to its support. Is it expedient to adhere to the law which compels all payments to be made in gold when demanded? It is considered to be so important, that one of the alleged motives for establishing Branch Banks was to prevent excess, which would endanger it. To take a commodity into a full market, and offer it at a reduced price, is a curious mode of lessening supply. Comparative cheapness will bring custom, and Branch Banks will, in time, acquire business.. They are already resorted to more and more for receiving dividends on stock; and the profound secrecy kept respecting all bill transactions, together with the cheapness, will induce traders to discount at the Branch Banks, wherever bills are much in use. No device within human skill to adopt, could so infallibly cause the law which compels cash payments to be broken, as that of suppressing country bank notes and country banks, and substituting the notes of the Bank of England and Branch Banks. The system, therefore, cannot be established, without producing the greatest danger to the Bank of England, and enormous evil in the country.

Your memorialist having stated his reasons, at some length, against the establishment of Branch Banks as an exclusive system, must bestow a brief notice on the consideration that it may go on advantageously, band in hand, with the private bank system.

The directors will either succeed in their object, or they will not. If they cannot succeed, the present state of uncertainty and apprehension should be put an end to immediately, by the entire abandonment of the scheme; but if they do succeed, and take from country bankers all their wealthy customers, and those who are engaged in most extensive traffic, the other classes (the most important in regard to raising or maturing the productions which constitute permanent national wealth) must be abandoned; because the extensive traders and the opulent members of the community are those alone on whom bankers can depend for repayment of loans, or assistance in sudden emergencies. To this cause, and the alarm engendered in the minds of bankers regarding the effects which may flow from chimerical attempts to improve the banking system, must be ascribed the late and present difficulty in employing money. The country bankers draw it in from the many

who were employing it, in small portions, in operations of industry in England, and lend it to a wealthy agent in London, who relends it to some enormous capitalist engaged in advancing loans to foreign states, or in some mining or other speculations abroad. This process is in extensive though in silent operation; and it will, in the end, produce enormous evil. Banking transactions are amongst the most hidden of all the operations of commerce; to which cause must be ascribed, in great measure, the injurious proceedings of public bodies in regard to bankers. By collecting, from various sources, a mass of individual cases, the truth might be demonstrated. Your memorialist will cite one of these cases. He is acquainted with a country banker, who, till of late, generally employed all his surplus capital amongst the industrious in the neighborhood of his bank. He has recently, for a considerable time, lent £100,000. to a wealthy agent in London, at a low rate of interest, who has again lent that and other sums to a great house in the city, engaged in working mines in Sweden. Another city firm is adopting measures for working mines in Asia. In this manner do these chimerical changes work, which have been introduced in banking concerns. Capital is withdrawn from the humble sources of industry, producing misery in the homesteads of Englishmen, to aid the distant speculations of some overgrown capitalist the glittering evidences of whose wealth, and his influence in the higher circles of society in the metropolis, has been a prolific source of error in deciding this question.

Let any considerate man, acquainted with the country, take a survey of England; look at her present productions; regard her state fifty years back; search into the causes of her present condition; and consider what will be the effect of suppressing country banks, and establishing, very partially, in a few places only, Branch Banks of England, and he will be convinced of the danger attending this change of system.

The design of your memorialist being to implore the attention of your Lordship and the government to a just consideration of the effects of the present proceedings of the directors of the Bank on the welfare of the people, he abstains from adverting, in any detailed manner, to the effect of the same proceedings on the interests of Bank Stock proprietors. The evidences of the extreme danger to those interests, hazarded by the establishment of Branch Banks, are distinct and palpable to all who are acquainted with the principles of banking. But there is another view of these measures, besides that which bankers take. Nothing can be worse, in principle, than that the character of practical paymaster of the Exchequer should be blended in the same person with him who claims on the Exchequer. It is manifestly unfit that the

bankers of the state should be the general bankers of the public, who have demands on the state. The Branch Banks obtain powers to receive dividends: thus, the servants of the Bank enter their offices to obtain payment from the servants of the Bank. Is it wise, in this manner, to remove the safeguards against fraud, and to relax the rules made to prevent the commission of crime, after we have seen that a single servant of the Bank could defraud the establishment of nearly half a million sterling, under the immediate superintendance of his masters ?

Still less is your memorialist disposed to enter on that political part of the subject, which relates to the constitutional danger of investing any body of men with so much power as that which the directors of the Bank are grasping at. Your memorialist believes that the sum is not less than a hundred millions sterling, which is deposited by the public in private banks. When the private banks are subverted, or greatly injured, a great part of this sum may be in the Bank of England; which, combined with the whole paper circulation of the kingdom in the same hands, might give the means to an unprincipled and ambitious minister, in times of political commotion, by caballing with a subservient directory, to usurp the sceptre of the state. Or he might set at nought the watchfulness of parliament. If the Commons refuse to grant the supplies, money may be had from the Bank till a more convenient parliament can be summoned.

That the directors are full of integrity, and the minister full of honor, does not render the assumption of possible evil, in an extreme case, absurd. If it be shown that the principle, pushed to the extreme, leads to these consequences, any degree of evil, short of the extreme, may fairly be anticipated.

Viewed in whatever light they may be, the present proceedings of the Bank are pregnant with evil. They tend to destroy all the results of experience and judgment, in regard to the employment of labor; to cause capital to be drawn from industry in the country to be employed on industry in great towns and foreign states; to wrest it from those occupations wherein the returns are remote, the employment of labor regular and long-continued, and fortunes are slowly made and rarely lost, to be employed in speculative undertakings. They disturb the institutions of industry, and introduce disorder into the avocations of all below the first class, whose pursuits depend on the temporary or permanent application of other capital than their own. Habits have been formed, the supply of productions arranged, masters and servants have been fixed in engagements, according to the country bank system. Habits, settled and undisturbed for generations, have, as to their effects in society, all the force of laws. The common law of the land is