be more clear and correct than the narrative of Sir Archibald Alison. He sees clearly that a difference in value between the assignat and specie was truly a discount, or fall in the value of paper. Thus he says:*

"They for some time maintained their value on a par with the metallic currency. By degrees, however, the increasing issue of paper currency produced its usual effect on public credit; the value of money fell, while that of every other article rose in a high proportion, and at length the excessive inundation of fictitious currency caused a universal panic, and its value rapidly sank to a merely nominal ratio. Even in June, 1790, the depreciation had become so considerable as to excite serious panic"

Again, speaking of 1791, p. 305

"Public and private credit had alike perished amidst the general convulsions. Specie had disappeared from circulation. The assignat had fallen to a third of its value-[This is not quite correct; at this time the assignat had lost one-third of its value, not fallen to one-third of it]—and occasioned such an amount of ruin to private fortunes that numbers already wished for a return to the ancient régime

"While the unlimited issues of assignats, at whatever rate of discount they might pass, amply provided for all the present and probable wants of the Treasury, the vast and increasing expenditure of the Republic could only, amidst the total failure of the taxes, be supplied by the issue of assignats; and this, of course, by rendering paper money redundant, lowered its value in exchange with other commodities, and occasioned a constant and even frightful rise of prices

"All the persons employed by Government, both in the civil and military departments, were paid in the paper currency at par; but as it rapidly fell, from the enormous quantity in circulation, to a tenth part, and soon a twentieth of its real value, the pay received was merely nominal, and those in receipt of the largest apparent incomes were in want of the common necessaries of life. Pichegru, at the head of the army of the North, with a History of Europe, Vol. II., p. 219, 7th Edit.

*

nominal pay of 4,000 francs a month, was in the actual receipt, on the Rhine in 1795, of only 200 francs, or £8 sterling of gold and silver

"The funds on which the enormous paper circulation was based embracing all the confiscated property in the kingdom in land, houses, and moveables, were estimated at fifteen milliards. of francs, above £600,000,000 sterling; but, in the distracted. state of the country few purchasers could be found for such immense national domains; and, therefore, the security for all practical purposes was merely nominal. The consequence was that the assignat fell to one-twelfth of its real value; in other words, an assignat for 24 francs was worth only 2 francs; that is, a note for a pound was worth only 1s. 8d.

"Foreign commerce having begun to revive with the cessation of the Reign of Terror, sales being no longer forced, the assignat was brought into comparison with the currency of other countries, and its enormous inferiority precipitated still further its fall

"By no possible measure of finance could paper money, worth nothing in foreign states, from a distrust of its security, and redundant at home from excessive issue, be maintained at anything like an equality with gold and silver. The mandates were, in truth, a reduction of assignats to a thirtieth part of their value; but, to be on a par with the precious metals, they should have been issued at one-thousandth part, being the rate of discount to which the original paper had now fallen

"The excessive fall of the paper at length made all classes perceive that it was in vain to pursue the chimera of upholding its value. On the 16th July, 1796, the measures, amounting to an open confession of a bankruptcy which had long existed, were adopted"

28. We have quoted these passages for the purpose of shewing how completely Sir Archibald Alison, when he is speaking of the paper currency in France, acknowledges the great principle that the value of the paper currency is only to be estimated at the value it will purchase in specie, that the measure of that difference between the real and the nominal value is its

depreciation, and that a payment in coin at the current value of the paper currency is a National Bankruptcy. Yet, such is the amazing inconsistency of this writer, that when he comes to speak of the paper currency of England, which exhibited exactly the same phenomena, only on a smaller scale, he resolutely denies that it was depreciated. When the French assignat had lost one-third of its value compared to specie, in 1791, he acknowledges that it was depreciated; when the Bank of England note in 1811 had lost one-fourth of its value compared to specie, it was not the note which had fallen, but gold which had risen!! When assignats were made legal tender in France at their nominal value, specie disappeared from circulation. Sir Archibald Alison estimates the depreciation of the assignat by the difference between the current and the nominal value of the assignat; but when the Bullion Committee estimated the depreciation of the Bank note by the difference between its nominal and its current or market value, he reads a homily to them upon their ignorance and folly, talks of the "general delusion which so long had prevailed upon the subject, when it is recollected not only that the true principles of this apparently difficult, but really simple branch of national economy, which are now generally admitted were at the time most ably expounded by many men both in and out of Parliament, but that, in the examination of some of the leading merchants of London before the Parliamentary Committee on the subject, the truth was told with a force and precision which it now appears surprising any one could resist." This truth, which was told with such irresistible force and precision, was that twenty-seven was equal to twenty-one! He then acknowledges that it was a national bankruptcy of the French Government to pay its notes with a less amount of specie than their nominal value; but nothing can exceed the bitterness of his invective against the Currency Act of 1819, which provided that the Bank of England should pay its notes at their full nominal value in specie. Just as if it was less a bankruptcy to pay 158. in the pound than to pay 1s. in the pound. He sees clearly that in France the paper currency is to be estimated by the value of gold; but in England he maintains that gold is to be estimated by the value of the paper currency!! Just as if the eternal truths of science are different on different sides of the

nominal pay of 4,000 francs a month, was in the actual receipt, on the Rhine in 1795, of only 200 francs, or £8 sterling of gold and silver

"The funds on which the enormous paper circulation was based embracing all the confiscated property in the kingdom in land, houses, and moveables, were estimated at fifteen milliards of francs, above £600,000,000 sterling; but, in the distracted state of the country few purchasers could be found for such immense national domains; and, therefore, the security for all practical purposes was merely nominal. The consequence was that the assignat fell to one-twelfth of its real value; in other words, an assignat for 24 francs was worth only 2 francs; that is, a note for a pound was worth only 18. 8d.

"Foreign commerce having begun to revive with the cessation of the Reign of Terror, sales being no longer forced, the assignat was brought into comparison with the currency of other countries, and its enormous inferiority precipitated still further its fall

"By no possible measure of finance could paper money, worth nothing in foreign states, from a distrust of its security, and redundant at home from excessive issue, be maintained at anything like an equality with gold and silver. The mandates were, in truth, a reduction of assignats to a thirtieth part of their value; but, to be on a par with the precious metals, they should have been issued at one-thousandth part, being the rate of discount to which the original paper had now fallen

"The excessive fall of the paper at length made all classes perceive that it was in vain to pursue the chimera of upholding its value. On the 16th July, 1796, the measures, amounting to an open confession of a bankruptcy which had long existed, were adopted"

28. We have quoted these passages for the purpose of shewing how completely Sir Archibald Alison, when he is speaking of the paper currency in France, acknowledges the great principle that the value of the paper currency is only to be estimated at the value it will purchase in specie, that the measure of that difference between the real and the nominal value is its

depreciation, and that a payment in coin at the current value of the paper currency is a National Bankruptcy. Yet, such is the amazing inconsistency of this writer, that when he comes to speak of the paper currency of England, which exhibited exactly the same phenomena, only on a smaller scale, he resolutely denies that it was depreciated. When the French assignat had lost one-third of its value compared to specie, in 1791, he acknowledges that it was depreciated; when the Bank of England note in 1811 had lost one-fourth of its value compared to specie, it was not the note which had fallen, but gold which had risen!! When assignats were made legal tender in France at their nominal value, specie disappeared from circulation. Sir Archibald Alison estimates the depreciation of the assignat by the difference between the current and the nominal value of the assignat; but when the Bullion Committee estimated the depreciation of the Bank note by the difference between its nominal and its current or market value, he reads a homily to them upon their ignorance and folly, talks of the "general delusion which so long had prevailed upon the subject, when it is recollected not only that the true principles of this apparently difficult, but really simple branch of national economy, which are now generally admitted were at the time most ably expounded by many men both in and out of Parliament, but that, in the examination of some of the leading merchants of London before the Parliamentary Committee on the subject, the truth was told with a force and precision which it now appears surprising any one could resist." This truth, which was told with such irresistible force and precision, was that twenty-seven was equal to twenty-one! He then acknowledges that it was a national bankruptcy of the French Government to pay its notes with a less amount of specie than their nominal value; but nothing can exceed the bitterness of his invective against the Currency Act of 1819, which provided that the Bank of England should pay its notes at their full nominal value in specie. Just as if it was less a bankruptcy to pay 15s. in the pound than to pay 1s. in the pound. He sees clearly that in France the paper currency is to be estimated by the value of gold; but in England he maintains that gold is to be estimated by the value of the paper currency!! Just as if the eternal truths of science are different on different sides of the