Monday, March 7, 2022

Pointing out the financialization of 1820-1850

 From Blackwood's Edinburgh Magazine of February 1851 at Project Gutenberg:

For thirty years past it has been the uniform policy of the British Government, directed by the pressure of the money power, and the influence of realised capital, to augment the value of realised wealth, by enhancing its price and cheapening everything else. To effect this, gold was first selected as the standard, because it was the most valuable of the precious metals; and as its price had for a long course of years been slowly but steadily advancing, it was thought, with reason, that the assumption of it as the standard could not fail to enhance the value of realised capital of every kind, by cheapening the money-price of all the articles in which every one else dealt.

Next, small notes were extinguished, because they formed a currency commensurate to the wants of the nation; and consequently their abundance tended to raise prices. Then the issue of notes beyond £32,000,000 in the whole empire was made to depend on an amount of gold coin corresponding to the notes issued being in the coffers of the banks issuing: in other words, the currency beyond that limited amount, not half of what the nation required, was made entirely metallic.

Free Trade was next introduced, in order still further to augment the value of realised wealth, by taking a fourth from the price of every commodity which it might purchase, and consequently depressing to a similar extent the remuneration of productive industry.

All this was rested on the plausible plea of maintaining a fixed and unchangeable standard of value, and preventing monetary crises, by having no circulation except what was based on the most precious of the precious metals.

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