TOPICS OF THE DAY.
MR. LOWE AND HIS POUND AGAIN.
THE more one thinks over Mr. Lowe's conundrum in cur- rency, the more certain does it appear that he is right as to the answer, and that, like most conundrum-makers, he is giving a great deal of trouble to secure a very inadequate result. All the opponents of his view seem to us to assume certain conditions which, if granted, must be followed by their deductions, but which are not of necessity included within the problem. The Economist, for example, which has always a tendency to be credulous upon one point, the amount of stupidity in mankind, says the country folk will grumble very much over the " sweated sovereign." They will say it is lighter or smaller, and will not believe that it will purchase as much tea, or meat, or candles as it used to do, and will be very discontented. The simplest answer perhaps to that is that their discontent does not signify one straw, that they will be sure to take the only sovereign they can get, and sure to find out in a month that their apprehensions were groundless. They got over the reform of the calendar and the abolition of the duty on corn, and they will get over a change in the number of grains in the pound without setting the world on fire. If we are never to legislate upon any question till the majority understand it, we must either confine legislation within very narrow limits, or make up our minds to a measure of education such as the most sanguine professor has never yet ventured to advise. There is no need, however, to use an argument which, though true, is always offensive, for the Economist is only begging the question. There is no reason why, if appearance is so important, the sovereign should not be worth twopence less, and yet retain its existing weight. If the legal number of grains are there, an additional weight of alloy could make no difference in the exchangeable value. Indeed, new sovereigns vary from eachother alreadybya fraction of a grain without perceptible effect upon circulation, though the variation tempts the melter. The amount of alloy is fixed by Act, just as the weight is, and could be altered with just the same result. Mr. Hubbard's objection, again, about the effect of reduction upon our international trade must surely be over- strained. If the sovereign will buy as much wheat, or tea, or sugar as it did before, why won't it buy as much bullion ? That is a commodity, like any other, and subject to precisely the same laws. Messrs. Ingot and Co. want to buy bread and tea and sugar with their profits, just like everybody else. The only effect of the State taking twopence from each coin would be that the remitters would remit bullion in bars instead of in boxes of sovereigns, which is precisely what Mr. Lowe wants them to do. Where is the loss in that, more particularly if, as we have suggested, the State would consent to verify bullion in bar, stamping one coin, so to speak, instead of 500 ? A third objection, that Mr. Lowe's reduction, amounting, as it will do, to an import duty on gold, must thus reduce the profit of gold-mining, is true, to some partial extent—for, as far as the miner is paid in British goods, there will be no reduction —but what interest has the State in keeping up the profit
on gold-mining that it has not in keeping up the profit on any commodity which, for the sake of revenue, we tax ?
Without a duty more would be purchased of anything now dutiable, but the evil is no greater in the case of one article than another.
Except in his idea of the immense advantage of international coinage, which would be of scarcely any advantage at all, and would make the offence of coining much more difficult of punishment, Mr. Lowe, we maintain, is right ; but then what is the use of being right, when to be right is only to bb willing to give a vast amount of trouble for the sake of gaining next to nothing at all ? When a Chancellor of the Exchequer proposes to lower the value of the best coin in the world, a coin so well known and so popular that people almost consider its immutability a law of nature, politicians naturally assume without much inquiry that he has some very serious, or at least quite adequate reason for setting the whole world at work at a currency puzzle ; but looked at steadily, to what does his reason amount ? Just to this,—that by the present system the country loses a few pounds a year, how many is not known, but certainly less than £56,000. That is the loss we incur by calling in the gold coinage once in every ten years, and paying for wear-and-tear out of income-tax, instead of paying for it out of a special tax upon gold. That is not a large sum to lose for the sake of possessing a coin which any
banker or trader anywhere in the world will take at the exchange of the day, and which in India, where it is not current, is considered so trustworthy as to be worth 2 per cent. more than its own weight of uncoined standard gold ; and that sum is evidently the whole loss. Mr. Lowe says the English sovereign is now current in Brazil and Madeira. and. all manner of places, and we are therefore actually coining for foreign Governments, who ought to pay their own coinage expenses. So they ought, no doubt, but beyond a. few pounds a year in the shape of Mint expenses—about which we have something to say directly—what does the craftiness of Brazilian financiers cost this country ? Absolutely- nothing at all. Travellers gain a little, because they have a. coin which they and their hosts alike understand, and the trader is just where he was, neither injured nor benefited, except, indeed, that he has a slightly increased facility for making his calculations. If the whole world would use the English sovereign, we should have an international coinage of the most perfect kind ; and if that would be a great advantage, the adoption of the sovereign by any bit of the world must be pro tanto an advantage too. We do not believe it is an advan- tage, unless accounts are kept in the coin, which out of these- Islands is not the case ; but, at all events, it can be no loss beyond the expense of coinage. But, again, Mr. Lowe remarks, the sovereign is melted down, both to obtain the small profit involved in the occasional overweight and for the purposes of the jeweller. Well, why should it not be melted down ? The practice is certain, like everything else, to reduce itself to an average, and the only injury to the Mint is that it has year by year to coin a certain number of sovereigns more than it other- wise would. There is no injury to the public whatever beyond the expense of such coinage, rather a slight gain, a faintly decreased chance of being swindled as to the quality of the gold which it buys in wedding-rings and the like. The entire loss of every kind is represented by that loss of £56,000 a year, for Mr. Lowe's notion that after reduction English sovereigns will not be withdrawn to meet any pressure for gold must be a mere delusion. The bullion will be with- drawn as bullion, and if withdrawn, it cannot go to the Mint, where it would go, and there will be just so many fewer- sovereigns in circulation. The only difference will be one of the few hours or days required to coin the gold. The money loss, we repeat, is the only loss, and even if it continues is not worth the fuss Mr. Lowe is making about it ; not worth a change which from London to Lahore would be felt as as, annoyance given for a totally inadequate cause, not worth, the waste of time and thought and temper the discussions about it will involve.
Moreover, the loss need not continue. If the Chancellor of the Exchequer is such a devotee to trade principles that he actually cannot endure to give anything for nothing even when the country desires it, he can recoup himself very easily. Let him add one more to the " token " coins of which we have already so many, coins, that is, which derive their value from their legal circulation and exchangeability for sovereigns. Let us have a five-shilling gold piece, the coin of all others. most needed, and treat that, or that and the ten-shilling piece as tokens merely. The penny is not worth a halfpenny as metal, the shilling is above its value in silver, let us have a five-shilling piece not worth above 4s. 11d. For inter- nal currency such a coin would be even more popular than the 5-franc is in France, for our " little commerce " is on rather a larger scale than theirs, and the gain—which might be safely made even greater, as great as it would be on five silver• shillings—would soon make up the vacuum so much abhorred in the Mint receipts. No trade would be affected, any more than it is affected by the alloy in the silver shillings, no accounts would be altered, remittances would go on as they do, mining profits would remain unaffected, and Mr. Lowe's conundrum would take its true place, as a problem soluble indeed, but not worth the time or the thought to be expended in its solution.
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