The Decline and Fall of The English of System of Finance

The Decline and Fall of The English of System of Finance

NOTHING, they say, is more certain but death, and nothing more uncertain than the time of dying; yet we can always fix a period beyond which man cannot live, and within some moment of which he will die.

We are enabled to do this, not by any spirit of prophecy, or foresight into the event, but by observations of what has happened in all cases of human or animal existence. If then
any other subject, such, for instance, as a system of finance, exhibits in its progress a series of symptoms indicating decay, its final dissolution is certain, and the period of it can be calculated from the symptoms it exhibits.

Those who have hitherto written on the English system of finance (the funding system) have been uniformly impressed with the idea of its downfall happening some time or other. They took, however, no data for that opinion, but expressed it predictively, or merely as opinion, from a conviction that the perpetual duration of such a system was a natural impossibility. It is in this manner that Dr. Price has spoken of it; and Smith, in his Wealth of Nations, has spoken in the same manner; that is, merely as opinion without data.

The progress, says Smith, is of the enormous debts, which at present oppress, and will in the long-run most probably ruin, all the great nations of Europe, (he should have said governments) has been pretty uniform. But this general manner of speaking, though it might make some impression, carried with it no conviction.

It is not my intention to predict any thing; but I will shew from data already known, from symptoms and facts which the English funding system has already exhibited publicly, that it will not continue to the end of Mr. Pitt’s life, supposing him to live the usual age of a man. How much sooner it may fall, I leave to others to predict.

Let financiers diversify systems of credit as they will, it is nevertheless true, that every system of credit is a system of paper money. Two experiments have at ready been had upon paper money; the one in America, the other in France. In both those cafes the whole capital was emitted, and the whole capital, which in America was called continental money, and in France assignats, appeared in circulation; the consequence of which was, that the quantity became so enormous, and so disproportioned to the quantity of population, and to the quantity of objects upon which it could be employed, that the market, if I may so express it, was glutted with it, and the value of it fell.