them in a state of inactivity, or hinder them from bettering their fortunes. The vigour of the nation cannot be kept down to the par of their imbecility; nor would this finally be any benefit to them, but very much the contrary: even if all neighbouring countries should, by universal agreement, consent to be stationary too, -ceasing their progression in the arts and enjoyments of life. However, in the end, even persons thus circumstanced would,-I mean many of them,-derive advantage from the operation of the plan, by partaking, from collateral and accidental causes, in the general prosperity; and all of them would be eased by the reduction of taxes, which would be one of the most probable and most extensive consequences of the proposed measure, as more fully noticed in a subsequent part of this Letter.

SECT. V.-The Advantages of the Plan, how to be disposed of.

It has been said, I understand, by some persons, that there is a partiality in giving to the stockholders the great advantages I have spoken of.

I have said the emoluments to result from the plan ought to be divided between the stock-proprietors, the Bank of England, and the government, (that is, the nation at large,) in such proportions as may be agreed upon; of course, in just and equitable proportions. Surely some share of the advantages must be given to the stock-transferrers, and sufficient to induce them to engage their property in the execution of the scheme. This is all that I have in view, or have suggested.

And this may be done in the following manner :-Let the privilege of issuing the proposed notes be given to the subscribers to FUTURE GOVERNMENT LOANS: and as the subscribers, with this bonus given to them, would take the loans on better terms, in proportion to the advantages they obtained, the whole public would, by that means largely participate in the profit to result from the scheme.

SECT. VI.-How the Plan may be applied to the Relief of the Landed Interest.

My design from the beginning was, and still is, to accomplish, if I am able, the procuring of assistance to those who want money upon the security of land to enable them to pay their debts, or to improve their estates; and even this not for their sakes only, but for the general good of the country.

If the scheme I have proposed should take a more extensive range, and become applicable to other purposes besides the relief of the landed interest, it will be an accidental result. I was looking for one thing, and it may turn out that I have found another of more importance; or rather an application of what I had in view to a more important subject. I believe this is what commonly happens in such cases.

But (in relation to the landed interest), I think the plan in question may be adapted to the accommodation of the land proprietors in the following manner :

Let the persons who are to obtain the notes upon the security of their transferred stock engage to lend the notes upon mortgages of land, and to deposit the mortgages in the Bank of England within a limited time; their transferred stock being a security for the performance of this engagement. And let the mortgages, when deposited, be declared by the act of the legislature, which is to establish the whole measure, a further and collateral security for the amount of the circulating notes:-each mortgage for the amount of the notes lent thereon. Thus the note creditor, however well satisfied he might be with the original security of the stock, would have another security of probably twice the amount of the notes,—a security far superior to that of an undefined, and, in some measure one may say, an imaginary quantity of gold deposited in a bank. Every million of notes would be represented by four millions of stock and about two millions sterling in land!— I do not, however, mean to represent this additional security as necessary to give strength to the original plan. I propose it as subordinate and convenient merely, not at all as being essential.

The mortgages when deposited would be capable of being trans

ferred like other mortgages, but always subject to a general lien for the amount of the notes lent thereon; and might be discharged by bringing in to be cancelled an equal amount in notes of the same kind; these being cancelled, (that is, an equal amount, not the identical notes lent upon each mortgage,) the land might be re-conveyed to the proper owner for the time being, discharged of the mortgage. And, at the same time, the transferred stock connected with the mortgage so released, might be re-transferred to the person to whom it should then belong.

By this means there would be a constant tendency of some portion of the notes to return into the bank to be cancelled; which would prevent an excessive accumulation of the quantity: some periods might also be fixed for this purpose, and with this view; whereby the gradual and final extinction of the notes might be provided for, if a change of circumstances should require such extinction.

This operation of lending upon mortgages should be left, I think, to the discretion of the individuals by whom the loans are made, both in respect to the titles to the mortgaged lands, and the quantity of security, and, within some limits to be prescribed, the periods of repayment also; except that some superintendence would be proper merely to ascertain that the loans were made bona fide upon the lands appearing in the several mortgages, and not employed for any other purpose in the first instance.— Of which the deposit of the mortgages, with proper inspection, would furnish good evidence.

The risk of the security would upon this footing rest upon each individual lender; but that risk, after the plan shall have been acted upon for some considerable time, would be much less than it is now in similar loans; because, as by the means proposed there would be established a very extensive register of mortgages, the disputes and frauds which too often attend securities of that nature would to a great degree be avoided.

This restriction of the loans (so long as it should be thought right to continue such restriction) to landed securities would in itself limit the quantity of the proposed notes to the amount of the demand of money by land-owners desirous of borrowing. From them the money would be absorbed into the general circulation, by

payment of their debts, and by their making agricultural and other improvements. By this means, also, tradesmen who are distressed for want of more early payment than they now receive, would be enabled to carry on their business and make their own payments with greater facility and more comfort than they can do at present.

SECT. VII.-General Advantages.

Thus, public industry would receive a new impulse, employment would be given to many who are now in want of it, lands now unimproved and waste would be brought into cultivation, houses and other buildings would be repaired or erected, canals would be completed that are now left unfinished for want of money, bridges would be built, mines would be worked, new sources of trade would be opened, and commerce in a thousand ways would be invigorated and put into a state of activity.

This may seem to suppose a more free use of the proposed money than could probably take place through loans on land only; but in whatever way, or to whatever extent, the money should be employed, the mass and quantity of useful and necessary commodities, and consequently the comforts of the people, would be increased by this additional stimulus given to the national exertion. This increase would be proportionably greater than the increase of money, supposing the latter to be added to with discretion and by slow and gentle degrees, and not by an inundation of new representative signs; for it must all along be borne in mind, that public wisdom is to direct the operation and to be employed in controlling the tides of this new money.

SECT. VIII.-Effect of the Plan upon the Rate of Interest, and Reduction of the National Debt.

One of the most direct consequences to be expected from my plan, is the lowering of the rate of interest. If it should be reduced generally below five per cent. that reduction would take away a part of the gain originally computed in the plan. But this would be counterbalanced by the good effects which a low rate of interest always produces, and by other beneficial consequences which the plan may be made to accomplish.

Indeed, this lowering of the rate of interest would be, above all other means, I conceive, the best auxiliary to the fund established by parliament for relieving the nation from the pressure of its great debt.

A most happy event it would be, if the five per cent, stock. could be reduced to four, and the other stocks in like proportion. A reduction to that extent would be the same thing in substance as a gratuitous extinction of a fifth part of the national debt; which consists altogether, in respect to the right of demanding payment, in the annuity payable by the nation to its creditors. Nor would it be difficult to effect a reduction to this amount by the help of the plan in question; supposing the funds shall ever again come to the prices they were at in 1792; a supposition which this plan would also tend to realize. I admit that this reduction can only accompany the fall of the market-rate of interest.

This operation of diminishing the annual out-going might begin precisely at the period when the Sinking Fund would lose part of its beneficial efficacy, in respect to buying up the public debt, on account of the near approach of 3 per cent. stock to par; in which stock purchases could then no longer be made with advantage, till the whole of the 5 per cent. and 4 per cent. stocks should be bought up. And though the latter stocks would be above par, the public would derive no gain from that circumstance, though the stock-holder might seem to sustain a loss by having his stock paid off at par. But the near prospect of such an event would keep those stocks from attaining the prices they would otherwise reach.

1.As, at the period I am now speaking of, the annual produce of the Sinking Fund could not, for the foregoing reasons, be applied with great advantage in buying up the national debt, I submit it might then be better disposed of, as a premium, in conjunction with the privilege of issuing the notes in question, towards inducing monied men to lend large sums of money at a rate below the then current rate of interest to be applied in paying off at par those debts which now carry a high interest. It will be soon found that I am not speaking without consideration when I talk of borrowing below the current rate of interest, if that is not apparent already.

In this way, though the nominal amount of the debt might continue to be the same as before, still the nation would be relieved by