CHAPTER VII.

COMMERCIAL AND ECONOMIC PROGRESS, 1840-1850.

The French Revolution and its Influence. Progress of Population.-Increase of Exports.-Improved Condition of the People.-Property assessed to Income Tax.-The Clearing House.-State of Finances.-Treaties of Commerce.

THE period now before us will ever be memorable in the commercial annals of England for the bold and independent commercial policy then fairly adopted. Sir Robert Peel, urged by the Anti-Corn Law League, and stimulated by the severe distress in Ireland, acted on the sound maxims of free trade, and under his leadership the corn laws were abolished and the tariff was remodelled. The banking laws also, which at all times have given rise to so much conflict of opinion, were now systematized; and the railway system was established, which had an immense influence on the economic condition of the country.

The commerce of the country did not run an even course of progress during the ten years. Several adverse influences acted against it. The principal of these were two very bad harvests, a bad cotton crop in the United States of America, too much speculation in railway shares, iron, and cotton, and more especially the political condition of Europe during the last five years.

of

A bad harvest had considerable influence in unsettling the politics of France in 1847. In that year the price of wheat, which usually ranged at 408. to 50s. per quarter, rose to 678. 4d., and instead of exporting, France had to import large quantities of grain, for which she had to make heavy payments. The commerce France did not prosper during the reign of Louis-Philippe. The imports for home consumption were checked by a prohibitory tariff; the exports were not increasing, and the people were not able to bear the losses and sacrifices which a bad harvest always entails. Were matters closely scrutinised, it would be found that it was more from economic than from political causes that France entered into that revolution which seemed to shake from the very centre not only her own but every throne in Europe.

The revolution of 1848 had a considerable influence not only on trade and industry,' but on banking and finance. On the Bank

The imports and exports of France were greatly affected by the revolution. In 1847 the value of imports was 53,713,000l., and of exports, 50,828,000l.: total, 104,541,000l. In 1848 the imports were 34,475,000l., the exports, 46,120,000l.:

of France the revolution produced a great change. In 1815 the capital of the Bank had been reduced to 62,900,000 fr., its two branches at Rouen and Lyons were closed, and its operations were limited to the metropolis. After the revolution of 1830, the want of banking accommodation being great, departmental banks were opened at Lyons, Marseilles, Lille, Orleans, Havre, and Toulouse, and the amount of their discounts rose from 352,000,000 fr. in 1838 to 851,000,000 fr. in 1847. The Bank of France, however, became jealous of their progress, and on the occasion of the renewal of its charter, sought and obtained a stipulation prohibiting the formation of any new departmental bank. But when, in 1848, the provisional government made enormous demands on the resources of the Bank, and a suspension of cash payments became necessary, a further step was taken towards the unification of banking, and by an arbitrary measure all the departmental banks were suddenly converted into branches of the Bank of France. The year 1848 was a trying one for France. Commerce and industry can never make progress whilst revolution and uncertainty weaken the institutions of the state.

The population of the United Kingdom suffered considerably from the mortality in and emigration of the people from Ireland. The results of the Census of 1851 were as follows:

The population of the principal towns increased as follows:

total, 80,595,000l., a decline of 23 per cent. The declared value of British manufactures exported to France in 1847 was 2,554,000l., and in 1848, 1,025,0007. The French 3 per cent. fell from 74 f. 10 to 51 f. 90, the 5 per cent. from 116 f. 76 to 72 f.; the shares of the Bank of France from 3,180 f, to 1,650 f.

The economic condition of the people improved considerably from the first introduction of Sir Robert Peel's free trade measures. With greater freedom there came more work, more resources. The exports of British produce and manufactures increased from 51,545,000l., or in the proportion of 17. 188. 6d. per head of the population in 1841, to 71,368,000l. or 2l. 118. 10d. per head in 1850. The consumption of the principal articles of food imported increased as follows:

-

The amount at the savings banks in the United Kingdom, which in 1841 was 24,474,689l., increased in 1850 to 28,931,000l. The number of paupers and the amount expended in the relief of the poor was large, especially in Ireland in 1848 and 1849, but they decreased considerably in 1850. A clear evidence of the increase of national wealth is afforded in the gross amount of the annual value of property and profits assessed to income tax, which as yet, however, was levied in Great Britain only. The amount of property assessed in 1843 and 1850 respectively, was as follows:

A great change took place in the administration of the Bank of England by the division of the banking from the issue department, as prescribed in the Bank Charter Act. On the 13th of March, 1845, the first minimum notice was given by the Bank respecting the rate of interest. No regular account yet existed of the transactions effected at the Clearing House, but in 1839 the amount of debts settled was 953,401,500l., for which 66,273,000l. of bank notes were sufficient. In 1840 the amount of transactions was 974,580,000l. Neither the joint-stock banks nor the Bank of England were yet admitted to the Clearing House.

The deposits at the London joint-stock banks increased as

The finances of the country under the administration of Sir Robert Peel and Sir Charles Wood continued in a satisfactory condition. The gross revenue in the year ending April 5, 1841, was 51,684,766l., or 1l. 198. per head, and in the year ending April 5, 1850, 57,576,2731., or 27. 18. 7d. per head. A loan of 8,000,000l. became necessary in 1847 to provide for aid to the sufferers from the bad harvest. It was negotiated at 897. 10s. for every 100l. stock, or at the rate of 3l. 78. 6d. per cent.

Several public treaties were concluded. First in importance. was the treaty with China, signed at Nanking on August 29, 1842. Treaties of commerce were concluded with Prussia in 1841, Russia in 1843, Borneo in 1847, Buenos Ayres, Costa Rica, and Guatemala in 1849, besides numerous treaties with African princes and chiefs for the abolition of the exports of slaves and permission to trade in their ports and places.

The progress of commerce was as follows:

Germany, Holland, and Belgium.

France, Portugal with Azores, Madeira, &c., and Spain with Gibraltar.
Italy, Austria, Greece, Ionian Islands, Malta, and Canaries.
United States of America.

British North America.

"British West Indies, with British Guiana and Honduras. British India, Ceylon, and Singapore.

• Australian colonies and New Zealand.

Decrease