3 April 1822
On 1 April Mr. Gooch brought up the report of the select committee on the distressed state of agriculture: it was then agreed that the report should be taken into consideration at the end of the month [see below, p. 155].
On 3 April, however, Mr. J. Benett presented a petition from the distressed agriculturists of Wiltshire, and this was made an occasion to anticipate the debate upon the report. Mr. Western expressed his dissent from the conclusions of the select committee and said that ‘an immense proportion of the present difficulties arose from the alteration in the currency’. ‘During the depreciation we had contracted an enormous debt, which was now to be paid by the industrious classes in a currency of increased value. This had made such a havoc in the property of the country, as was never made by revolution or civil war. It was true, during the depreciation of money, the rents of estates had been doubled, but incumbrances had doubled and taxes had quadrupled, so that the situation of landlord had not been a whit better. But what was the state of the landlord now? His income was again reduced to one half, and all their fixed payments remained.’
Mr. Ricardo said, that no one could be more aware of the great difficulties which had been occasioned by alterations in the currency than himself. He had given the subject the greatest attention in his power, and had laboured hard to show the necessity of a fixed and unvariable standard of value. At the same time, he could not agree with the hon. member for Essex, as to the operation of the changes in the currency upon agriculture. Let them suppose the utmost extent of the operation of the changes in currency on the pressure of taxes. They must deduct from the whole amount of taxation, the amount of those taxes which were employed in expenditure, as they had been diminished in proportion as the value of money had been augmented. Supposing, then, 40,000,000l. to remain, on which the operation of the currency on taxation was to be calculated. What proportion could possibly be paid by the tenantry of this amount? Suppose one fourth. He did not include the landlords in this calculation, but only the tenantry. Suppose one-fourth paid by the tenantry, their proportion would be 10,000,000l. Suppose, according to the extravagant calculation of the hon. gentleman, that 25 per cent was the real amount of the alteration operated by recurring to a metallic standard of value. Then 2,500,000l. was the whole extent of its operation on the tenantry. Was it possible that the distress which was now felt could be owing to 2,500,000l.? Such a sum was totally inadequate to such an effect. Let them look again at the landlords. The alteration could affect them only as it took more from them in the shape of taxation. No person was more ready than he was to admit, that it occasioned an increase of burthen in this shape as in every other; but he must be allowed to ask, whether, if the tenant paid the rent demanded, the landlord must not be benefited by receiving the same rent which he had exacted in the depreciated currency? He admitted that landlords did not receive the same rent, but had made an allowance equal to the depreciation. But, if he received the rest of the rent, whence arose the distress? He had given up 25 per cent, and received 75 per cent, equal to 100. How, then, was he injured? But the landlords did not receive 75 per cent. They told them that they could not receive any rent—that the distress was so great, that the surplus could not pay any thing but the taxes. He asked, then, whether the depreciation could possibly have occasioned this? He did not believe that the changes in the currency since 1819, had been more than 10 per cent. But did he say that the landed interest suffered only to the extent of 10 per cent? No such thing. The greatness of the distress he was most sensible of, and the causes which had been assigned he thought amply sufficient to account for it— namely, the abundance of several successive harvests, the importation of corn from Ireland, and other similar causes. It was utterly impossible that this country could be reduced to that situation that the surplus produce of agriculture should be only sufficient to pay the taxes, without affording any rent to the landlord, or any profit to the cultivator. This was a situation to which the country could not possibly come.— He wished here to say a few words of the report which the agricultural committee had made. The former report contained some most admirable propositions. If he might divide it into two parts, he would say, the first half was as excellent a report as had ever emanated from any committee of that House, and was well worthy of being placed beside the bullion report and the report on the resumption of cash payments by the Bank. It contained most sound and excellent observations on the corn trade, and on the corn-laws. It most justly pointed out two great evils arising from the corn-laws, which affected the present distress. The first was, when there was a scarcity, and corn rose to 80s., then the ports were opened, and we were deluged with foreign corn, whatever might be the price in the countries from which it came. The ports were open for any quantity. This was a great evil, and operated at the very time when the short harvest ought to be compensated by high prices. The second evil was felt when in a season of plenty we habitually produced corn at an expense very considerably above other countries. If there were successively good harvests, the farmer could obtain no relief from exportation, and was thus ruined by the abundance of produce. What was the inference from this, but that they should take measures, to enable our farmers, in seasons of abundance, when they could not obtain prices to compensate the expense of culture, to get relief by exporting to other countries, and for this purpose a duty on importation of foreign grain should be imposed, equal to the peculiar taxes which fell on the farmer, such as tythes and a part of the poor-rate; and a drawback of the same amount should be allowed on exportation. If such a regulation were adopted, after a small fall of prices, the farmer would then export to other countries, and relieve the glut of the corn market at home. Another part of the report was totally incorrect. It spoke of countervailing duties, not, as all countervailing duties ought to be, as imposts upon the importer in order to subject him to all the burthens of the home-grower of corn, so that the taxes might fall equally on grower and importer, but as duties which should be equal to the additional expense of growing corn in this country over other countries. Countervailing duties on this principle, would thus be sometimes 20s., and sometimes 30s. There appeared to him to be no principle more clear, than that there could not be a fixed remunerating price in any country. Before there was a dense state of population in a country, they would cultivate the very best lands, and they could then compete with any country, and export their surplus produce. There would then be no occasion for countervailing duties. But when population became more dense, poorer lands would be cultivated, and an increase of charges would arise from the greater expenses of cultivation. As population went on, the cultivation would go on to still poorer lands, and the price would continue to rise. If, then, the rule should be, for a countervailing duty, the difference of charge in the growth, no limit could be affixed to the amount. He could not conceive any system of duties more destructive to the best interests of the country.—He would now advert to the present report. He had gone into the committee under a deep impression of the great distress which the agricultural interest suffered, with a most unfeigned desire to find some means of relief, not upon the general and absolutely true principles of legislation, but with every inclination to give every facility to measures of immediate effect in alleviating distress. All he required was, that there should be something in the report, pledging them, when the distress should have gone by, and the farmers should be rescued from their suffering—for he was the advocate of the farmer, and not those who pretended to be the exclusive friend of agriculture—all he had required was, that the report should promise a return to proper principles when the present dangers should have been removed. But, although the report recognized the evil which produced low prices, and the apprehension of still lower prices, it did not hold up the slightest purpose of ever returning to sound principles. It expressed hopes of better principles being adopted, and the House would be astonished to hear what those principles were. It was to have recourse to the countervailing duties which he had explained. If on this plan they attempted to give a monopoly to grapes reared in hot-houses, countervailing duties might be imposed on wine, to make it as dear as the produce of the hot-houses. In the same way with sugar. In this way all branches of foreign commerce would be lost to this nation, and to every nation which adopted countervailing duties. The only true policy was to allow us to go to the country where the article required was most easily and abundantly produced. He was ashamed to occupy the time of the House so long [Cheers]; he would not go into detail, but he felt called upon to throw out a few observations. The hon. member for Essex had alluded to the West Indian cultivators. If he wanted an argument, he would take that very case, and he asked how the currency could be supposed to have affected them? Was it not notorious that their distress was entirely caused by over production? Were not the measures adopted for their relief calculated to give them a market for their produce which they had not before? In the same manner, the agriculturist of this country must be relieved by increased demand, or diminished supply. He had not said that taxes contributed not to the distress. On that point he had been misunderstood. They who were exposed to exclusive taxes ought to receive protection from those taxes. But on this subject he would give his opinions in greater detail on a future occasion.
Mr. H.G. Bennet ‘rose to protest against the doctrine, that taxes had nothing to do with the distresses of the agricultural interest’. The Marquis of Londonderry in reply said, ‘that hon. gentleman might take a lesson from his friend near him, the member for Portarlington, who had shown how small a portion of that distress now complained of had been thrown on the suffering individuals by taxation.... The distress was caused by the operation of the seasons, and the state of the markets; and therefore could not be cured by the remission of taxation, even though that were pushed to the length of national bankruptcy.... Though abundance was desirable, yet carried beyond a certain point, it occasioned evils like those now felt. He was not prepared to go into this view of the question, and to show how they suffered by abundance: but if the hon. member for Portarlington turned his intelligent mind to it, he could make the House understand this part of the subject.’
Mr. Ricardo corrected the error which appeared to have prevailed in the mind of his hon. friend, the member for Salisbury, that he (Mr. R.) was an advocate for taxation. On the contrary, he had voted for every reduction of taxes that had been proposed in the course of the session, because he was anxious for the repeal of taxes, feeling that every tax must prove a burthen upon the public.