Front Page Titles (by Subject) Chapter VIII.: MARKET-DAY. - Illustrations of Political Economy, vol. 5
The Online Library of Liberty
A project of Liberty Fund, Inc.
Chapter VIII.: MARKET-DAY. - Harriet Martineau, Illustrations of Political Economy, vol. 5 
Illustrations of Political Economy (3rd ed) in 9 vols. (London: Charles Fox, 1834). Vol. 5.
About Liberty Fund:
Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.
The text is in the public domain.
Fair use statement:
This material is put online to further the educational goals of Liberty Fund, Inc. Unless otherwise stated in the Copyright Information section above, this material may be used freely for educational and academic purposes. It may not be used in any way for profit.
The Cavendishes were not long at leisure to wonder at the Berkeleys. It would have been wiser to prepare to imitate them. But Mr. Cavendish, ‘who had no hope of long maintaining an apparent superiority over them, determined not to sink so quietly and simply as they had done, but to cause a sensation before his catastrophe, as well as by means of it, and thus to finish with a kind of éelat.
The introduction of foreign corn on the conclusion of the war had been for some little time hastening his ruin; and, knowing that it must be accomplished by the shock given to commercial credit, through the stoppage of the D— bank, he thought he would forestall the conclusion, and, by attributing his failure to an accident, keep as much as he could of his little remaining credit.
Wednesday being the market-day, no time was to be lost. On Tuesday, therefore, (a clerk having been opportunely got rid of,) all Haleham was thrown into consternation by the news of an embezzlement to an unheard-of extent, which had been perpetrated by the departed clerk. Bills were presently in every window, and on all the walls. Mrs. Cavendish was understood to be in hysterics, Mr. Longe gone in pursuit of the knave, the children running wild, while the governess was telling the story to everybody; and Mr. Cavendish talking about justice, and hanging the fellow; and everything but the facts of the case;—for he could not be brought to give any such information respecting the nature of the embezzled property, as could enable the magistrates to help him to recover it. Mr. Berkeley and Horace, hearing the news on their return to Haleham on the Tuesday night, pronounced it too coarse a device,—one which would deceive nobody; and prophesied that not only would the bank be shut as soon as the market opened in the morning, but that nothing whatever would remain to pay any creditor.
It seemed as if Enoch Pye was, for once, as shrewd as many a fonder lover of lucre; or perhaps it was the union of Mrs. Parndon's worldly wisdom with his own which caused him to be on the alert this Wednesday morning. Before the bank opened he was lingering about the street, and was the first to enter the doors to present a check for thirteen pounds, which he desired to have in gold, troubling himself to assign various reasons for coming so early, and wishing for gold. Almost before the clerk had told over the sum on the counter, a voice which Enoch did not find it convenient to hear, shouted from behind him, “Stop, there, stop! Make no payments. The bank has stopped. Make no payments, I say!”
The clerk snatched at the gold, but Enoch was too expert for him. He had crossed his arms over the money at the first alarm, and now-swept it into his hat, which he held between his knees, looking all the time in the clerk's face, with.
“Eh? What? What does he say? I won't detain you any longer. Good day, sir.”
“I'll detain you, though,” muttered the clerk, swinging himself over the counter, and making for the door. Enoch brushed out of it, however, turning his wig half round by the way. Cavendish, coming up, caught at the skirt of his coat, but Enoch could now spare a hand to twitch it away. He ran on, (the school-boys whom he met supposing him suddenly gone mad, to be hugging his hat while his wig covered only half his head,) and never stopped till he stood panting in Mrs. Parndon's presence. The only thought he had had time for all the way was, that the widow would, he really believed, - marry him within the hour for such a feat as this, if he had but the license ready, and could summon courage to ask her. Enoch was far too modest to perceive what everybody else saw, that the widow was quite ready to have him at any hour. He was much gratified at present by her soothing cares. She set his wig straight, examined the flap which had been in danger, to see if it had lost a button or wanted a stitch; shook and turned out the lining of his hat, lest a stray coin should be hidden, and setting her hot muffin and a fresh cup of tea before him, tried to tempt him to a second breakfast. It was not to be expected, however, that he could stay while such news was abroad: he had come, partly by instinct, and partly to be praised for his feat; and now he must go and bear his share of the excitements of the day. The widow persuaded him to wait two minutes, while she swallowed her cup of tea and threw on her shawl, leaving the muffin,—not as a treat to her cat or her little maid,—but to be set by and warmed up again for her tea, as she found time to direct before she took Mr. Pye's arm, and hastened with him down the street as fast as his ill-recovered breath would allow.
The excitement was indeed dreadful. If an earthquake had opened a chasm in the centre of the town, the consternation of the people could scarcely have been greater. It was folly to talk of holding a market, for not one buyer in twenty had any money but Cavendish's notes; and unless that one happened to have coin, he could achieve no purchase. The indignant people spurned bank-paper of every kind, even Bank of England notes. They trampled it under foot; they spat upon it; and some were foolish enough to tear it in pieces; thus destroying their only chance of recovering any of their property. Mr. Pye, and a few other respected townsmen, went among them, explaining that it would be wise at least to take care of the “promise to pay,” whether that promise should be ultimately fulfilled or not; and that it would be fulfilled by the Bank of England and many other banks, he had not the smallest doubt, miserably as the Haleham bank had failed in its engagements.
The depth of woe which was involved in this last truth could not be conceived but by those who witnessed the outward signs of it. The bitter weeping of the country women, who prepared to go home penniless to tell their husbands that the savings of years were swept away; the sullen gloom of the shop-keepers, leaning with folded arms against their door-posts, and only too sure of having no customers for some time to come: the wrath of farmer Martin, who was pushing his way to take his daughter Rhoda from out of the house of the swindler who had plundered her of her legacy and her wages in return for her faithful service; and the mute despair of Rhoda's lover, all of whose bright hopes were blasted in an hour;—his place gone, his earnings lost, and his mistress and himself both impoverished on the eve of their marriage: the desperation of the honest labourers of the neighbourhood on finding that the rent they had prepared, and the little provision for the purchase of winter food and clothing, had all vanished as in a clap of thunder; the merriment of the parish paupers at being- out of the scrape, and for the time better off than better men;—all these things were dreadful to hear and see. Even Mrs. Parndon's curiosity could not keep her long abroad in the presence of such misery. She went home, heartsick, to wonder and weep; while she told the sad tale to her daughter in a letter of twice the usual length. Enoch Pye retired behind his counter, and actually forgot to examine his stock of bank notes till he had paid his tribute of sorrow to the troubles of those who were less able than himself to bear pecuniary losses. Henry Craig was found wherever he was most wanted. He had little to give but advice and sympathy; but he had reason to hope that he did some good in calming the people's minds, and in showing them how they might accommodate and help one another. Under his encouragement, a limited traffic went on in the way of barter, which relieved a few of the most pressing wants of those who had entered the market as purchasers. The butcher and gardener did get rid of some of their perishable stock by such an exchange of commodities as enabled the parents of large families to carry home meat and potatoes for their children's dinners. Seldom has traffic been conducted so languidly or so pettishly; and seldom have trifling bargains been concluded amidst so many tears.
Cavendish found the affair even worse than he had anticipated. The confusion within doors actually terrified him when he took refuge there from the tumult without. His wife's hysterics were as vigorous as ever. Miss Egg had packed up her things and departed by the early coach, in high dudgeon with her dear friends for owing her a year's salary, and having, as she began to suspect, flattered her of late with false hopes of her winning Mr. Longe, in order to protract their debt to her, and furnish their children with a governess on cheap terms. Farmer Martin had carried off Rhoda, allowing her no further option than to take with her the poor little baby, whom there was no one else to take care of. The other servants had immediately departed, helping themselves pretty freely with whatever they hoped would not be missed, telling themselves and one another that these were the only particles of things in the shape of wages that they should ever see. Finding his house in this forlorn and deserted state, with no better garrison than a screaming wife and frightened children, while he was in full expectation of a siege by an enraged mob, the hero of this varied scene took the gallant resolution of making- his escape while he could do it quietly. He looked out an old black hat, and left his white one behind him; buttoned up some real money which he found in his wife's desk; threw on a cloak which concealed his tight ancles, and sneaked on board one of his own lighters, bribing the only man who was left on the premises to tow him down the river for a few miles and tell nobody in what direction he was gone.
Among the many hundreds whom he left behind to curse his name and his transactions, there were some who also cursed the system under which he had been able to perpetrate such extensive mischief. Some reprobated the entire invention of a paper currency; in which reprobation they were not, nor ever will be, joined by any who perceive with what economy, ease, and dispatch the commercial transactions of a country may be carried on by such a medium of exchange. Neither would any degree of reprobation avail to banish such a currency while convenience perpetually prompts to its adoption. Others ascribed the whole disaster to the use of small notes, urging that, prior to 1797, while no notes of a lower denomination than 5l. were issued, a run on a bank was a thing almost unheard of. Others, who esteemed small notes a convenience not to be dispensed with, complained of the example of inconvertibility set by the Bank of England; and insisted that methods of ensuring convertibility must exist, and would be all-sufficient for the security of property. Some objected to this, that mere convertibility was not enough without limitation; because though convertibility ensures the ultimate balance of the currency,—provides that it shall right itself from time to time,—it does not prevent the intermediate fluctuations which arise from the public not being immediately aware of the occasional abundance or dearth of money in the market. Notes usually circulate long before the holders wish for the gold they represent; so that fraudulent or careless issuers of convertible paper may have greatly exceeded safety in their issues before the public has warning to make its demand for gold; and thus the security of convertibility may be rendered merely nominal, unless accompanied by limitation. Others had a theory, that runs on banks were themselves the evil, and not merely the indications of evil; that all would he right if these could be obviated; and that they might be obviated in the provinces by the country bankers making their notes payable in London only. These reasoners did not perceive how much the value of notes, as money, would be depreciated by their being- made payable at various and inconvenient distances; so that there would soon be as many different values in notes of the same denomination as there are different distances between the principal country towns and London. All agreed that there must be something essentially wrong in the then present system, under which a great number of towns and villages were suffering as severely as Haleham.
The tidings of distress which every day brought were indeed terrific. The number of banks which failed went on increasing, apparently in proportion to the lessening number of those which remained, till every one began to ask where the mischief would stop, and whether any currency would be left in the country. Before the commercial tumult of that awful time ceased, ninety-two country banks became bankrupt, and a much greater number stopped payment for a longer or shorter period.
In proportion to the advantage to the moral and worldly condition of the working; classes of having a secure place of deposit where their savings might gather interest, was the injury then resulting from the disappointment of their confidence. Savings-banks now exist to obviate all excuse for improvidence on the plea of the difficulty of finding a secure method of investment, or place of deposit: but at the period when this crash took place, savings-banks were not established; and then was the time for the idle and wasteful to mock at the provident for having bestowed his labour and care in vain, and for too many of the latter class to give up as hopeless the attempt to improve their condition, since they found that their confidence had been abused, and their interests betrayed. There were not so great a number of working-people who suffered by the forfeiture of their deposits as by holding the notes of the unsound banks, because few banks received very small deposits; but such as there were belonged to the meritorious class who had been cheated in Haleham by Cavendish. They were the Chapmans, the Rhodas,—the industrious and thrifty, who ought to have been the most scrupulously dealt with, but whose little store was the very means of exposing them to the rapacity of sharpers, and of needy traders in capital whose credit was tottering.
After the pause which one day succeeded the relation of some melancholy news brought by Mr. Craig to the Berkeleys, Melea wondered whether other countries ever suffered from the state of their currency as England was now suffering, or whether foreign governments had long ago learned wisdom from our mistakes.
Her father replied by telling her that the Bank of Copenhagen had been privileged, before the middle of the last century, to issue inconvertible paper money; that the king, wishing to monopolize the advantage of making money so easily, had some years afterwards taken the concern into his own hands; and that, at the present moment, his people were wishing him joy of his undertaking, a dollar in silver being worth just sixteen dollars in paper.
“How very strange it seems,” observed Melea, “that none of these governments appear to see that the value of all money depends on its proportion to commodities; and the value of gold and paper money on their proportion to each other!”
“Catherine of Russia seems to have had some idea of it,” observed Mr. Berkeley, “for she was very moderate in her paper issues for some time after she gave her subjects that kind of currency: but at this time, the same denomination of money is worth four times as much in metals as in paper. Maria Theresa went wrong from the first. Presently after she introduced paper money into Austria, a silver florin was worth thirteen florins in paper. All the subsequent attempts of that government to mend the matter have failed. It has called in the old paper, and put out fresh; yet the proportionate value of the two kinds of currency is now eight to one. But the most incredible thing is that any government should institute a representative currency which, in fact, represents nothing.”
“Represents nothing! How is that possible.”
“Ask your mother to tell you the history of the Assignats. I know it is painful to her to recur to that terrible time; but she will think, as I do, that you ought to be aware what were the consequences of the most extraordinary currency the world ever saw.”
Mr. Craig could now account for Mrs. Berkeley's gravity whenever the subject of a vicious currency was touched upon in the remotest manner. He supposed she had suffered from family misfortunes at the time when all France was plunged into poverty by the explosion of the assignât system.
“How could a representative currency actually represent nothing?” inquired Melea again.
“The assignâts were declared legal money,” replied Mrs. Berkeley, “but there was nothing specified which they could represent. Their form was notes bearing the inscription' National Property Assignât of 100 francs. The question was first, what was meant by national property; and next, what determined the value of 100 francs.”
“And what was this national property.”
“In this case, it meant the confiscated estates which had fallen into the hands of the government, and were sold by auction: and the reason why this new kind of money was issued was because the revolutionary government, however rich in confiscated estates, was much in want of money, and thought this might be a good way of converting the one into the other. You see, however, that whether these slips of paper would bear the value of 100 francs, depended on the proportion of the assignâts to the purchasable property, and of both to the existing currency, and to the quantity of other commodities.”
“And, probably, the government, like many other governments, altered this proportion continually by new issues of paper money, while there was no corresponding increase of the property it represented.”
“Just so. More estates were confiscated, hut the assignats multiplied at a tenfold rate; driving better money out of the market, but still super-abounding. Prices rose enormously; and in proportion as they rose, people grew extravagant.”
“That seems an odd consequence of high prices.”
“If prices had been high from a scarcity of commodities, people would have grown economical; but the rise of price was in this case only a symptom of the depreciation of money. Every one, being afraid that it would fall still lower, was anxious to spend it while it remained worth anything. I well remember my poor father coming in and telling us that he had purchased a chateau in the provinces with its furniture. ‘Purchased a chateau!’ cried my mother. “When you have no fortune to leave to your children, what mad|ness to purchase an estate in the provinces!” It would be greater madness my father replied, “to keep my money till that which now purchases an estate will scarcely buy a joint of meat. If I could lay by my money, I would: as I cannot, I must take tlie first investment that offers,” And he proved to be right; for the deplorable poverty we soon suffered was yet a less evil than the punishment which my father could scarcely have escaped if he had kept his assignâts.”
“Do you mean legal punishment?”
“Yes. The government issued orders that its own most sapient plan should not fail. There was to be no difference between metal money and assignâts, under pain of six years' imprisonment in irons for every bargain in which the one should be taken at a greater or less value than the other.”
“How stupid! How barbarous!” exclaimed everybody. “Almost the entire population must have been imprisoned in irons, if the law had been executed: for they had little money but assignâts, and no power on earth could make paper promises valuable by calling them so.”
“Yet, when the law was found inefficient, the punishment was increased. Instead of six years, the offenders were now to be imprisoned twenty. As this expedient failed, more and more violent ones were resorted to, till the oppression became intolerable. All concealment of stock, every attempt to avoid bringing the necessaries of life to market, to be sold at the prices fixed by the government, every evasion of an offered purchase, however disadvantageous, was now made punishable by death.”
“Why then did not everybody refuse to buy, rather than expose sellers to such fearful danger?”
“There was soon no occasion for such an agreement. The shops were for the most part closed; and those which were not, displayed only the worst goods, while the better kinds still passed from hand to hand by means of secret bargains.”
“But what was done about the sale of bread and meat, and other articles of daily use?”
“The baker's shop opposite our windows had a rope fastened from the counter to a pole in the street: and customers took their place in the line it formed, according to the order of their corning. Each customer presented a certificate, obtained from the commissioners appointed to regulate all purchases and sales; which certificate attested the political principles of the bearer——”
“What! could not he buy a loaf of bread without declaring his political principles?”
“No; nor without a specification of the quantity he wished to purchase.”
“What a length of time it must have taken to supply a shop full of customers!”
“I have often seen hungry wretches arrive at dusk, and found them still waiting when I looked out in the morning. Our rest was frequently disturbed by tumults, in which the more exhausted of the stragglers were beaten down, and trampled to death. The bakers would fain have closed their shops; but every one who did so, after keeping shop a year, was declared a suspected person; and suspected persons had at that time no better prospect than the guillotine.”
“This system could not, of course, last long. How did it come to an end?”
“The government called in the assignâts when they had sunk to three hundred times less than their nominal value. But this was not till more murders had been committed by the paper money than by their guillotine.”
“You mean by distress,—by starvation.”
“And by the suicides occasioned by distress. My poor father was found in the Seine, one morning, after having been absent from home for two days, endeavouring in vain to make the necessary purchases of food for his family.”
Mr. B. added, that people flocked down to the river side every morning, to see the bodies of suicides fished up, and to look along the shore for some relative or acquaintance who was missing. As Melea had observed, this could not go on long; but the consequences were felt to this day, and would be for many a day to come. Every shock to commercial credit was a national misfortune which it required long years of stability to repair.
This was the point to which Mr. Berkeley's conversation now invariably came round; and none of his family could carry him over it. Silence always ensued on the mention of commercial credit. It was indeed a sore subject in every house in Haleham.