The Online Library of Liberty

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• Preface to Volumes Vi - Ix
• Introductory Notes to the Correspondence
• 1.: Ricardo to Horner
• 2.: Ricardo to Horner
• 3.: Ricardo to Sir Philip Francis
• 4.: Mill to Ricardo1[answered By 5]
• 5.: Ricardo to Mill3[reply to 4—answered By 6]
• 6.: Mill to Ricardo1[reply to 5]
• 7.: Ricardo to Dumont
• 8.: Malthus to Ricardo1[answered By 9]
• 9.: Ricardo to Malthus1[reply to 8.—ANSWERED By 10]
• 10.: Malthus to Ricardo1[reply to 9]
• 11.: Malthus to Ricardo
• 12.: Ricardo to [malthus][fragment]
• 13.: Malthus to Ricardo
• 14.: Ricardo to [malthus] [a Note On the Jamaica Exchange]
• 15.: Malthus to Ricardo 3[answered By 16]
• 16.: Ricardo to Malthus 2[reply to 15.—ANSWERED By 17]
• 17.: Malthus to Ricardo 1[reply to 16]
• 18.: Ricardo to Perceval 1[answered By 19]
• 19.: Perceval (by Rosenhagen) to Ricardo 1[reply to 18]
• 20.: Ricardo to Bentham 2
• 21.: Malthus to Ricardo 1
• 22.: Mill to Ricardo 1[answered By 23]
• 23.: Ricardo to Mill 1[reply to 22.—ANSWERED By 24]
• 24.: Mill to Ricardo 1[reply to 23]
• 25.: Ricardo to Malthus 1[answered By 26]
• 26.: Malthus to Ricardo 1[reply to 25.—ANSWERED By 27]
• 27.: Ricardo to Malthus 1[reply to 26]
• 28.: Malthus to Ricardo1
• 29.: Ricardo to Tierney 1[answered By 30]
• 30.: Tierney to Ricardo1[reply to 29]
• 31.: Malthus to Ricardo1
• 32.: Ricardo to Malthus3[answered By 33]
• 33.: Malthus to Ricardo5[reply to 32]
• 34.: Ricardo to Horner1
• 35.: Malthus to Ricardo2
• 36.: Ricardo to Malthus1[fragment]
• 37.: Ricardo to Malthus1
• 38.: Ricardo to Malthus1
• 39.: Ricardo to Malthus2
• 40.: Ricardo to Malthus 1
• 41.: Ricardo to Malthus2
• 42.: Ricardo to Malthus1
• 43.: Ricardo to Malthus1
• 44.: Ricardo to Trower1
• 45.: Ricardo to Malthus1
• 46.: Ricardo to Malthus1
• 47.: Trower to Ricardo1[answered By 48]
• 48.: Ricardo to Trower1[reply to 47]
• 49.: Mill to Ricardo1
• 50.: Ricardo to Malthus1[answered By 51]
• 51.: Malthus to Ricardo3[reply to 50.—ANSWERED By 53]
• 52.: Ricardo to Bentham and Mill1
• 53.: Ricardo to Malthus1[reply to 51.—ANSWERED By 54]
• 54.: Malthus to Ricardo1[reply to 53.—ANSWERED By 55]
• 55.: Ricardo to Malthus3[reply to 54.—ANSWERED By 56]
• 56.: Malthus to Ricardo1[reply to 55.—ANSWERED By 58]
• 57.: Mill to Ricardo1
• 58.: Ricardo to Malthus1[reply to 56.—ANSWERED By 59]
• 59.: Malthus to Ricardo3[reply to 58.—ANSWERED By 60]
• 60.: Ricardo to Malthus1[reply to 59.—ANSWERED By 62]
• 61.: Mill to Ricardo1
• 62.: Malthus to Ricardo1[reply to 60.—ANSWERED By 64]
• 63.: Sinclair to Ricardo1
• 64.: Ricardo to Malthus1[reply to 62.—ANSWERED By 67]
• 65.: Sinclair to Ricardo1[answered By 66]
• 66.: Ricardo to Sinclair1[reply to 65]
• 67.: Malthus to Ricardo2[reply to 64.—ANSWERED By 70]
• 68.: Mill to Ricardo1
• 69.: Place to Ricardo1
• 70.: Ricardo to Malthus1[reply to 67.—ANSWERED By 72]
• 71.: Ricardo to Say2
• 72.: Malthus to Ricardo1[reply to 70.—ANSWERED By 73]
• 73.: Ricardo to Malthus1[reply to 72]
• 74.: Ricardo to Malthus1[answered By 75]
• 75.: Malthus to Ricardo1[reply to 74.—ANSWERED By 76]
• 76.: Ricardo to Malthus2[reply to 75]
• 77.: Ricardo to Malthus3[answered By 78]
• 78.: Malthus to Ricardo2[reply to 77]
• 79.: Trower to Ricardo2
• 80.: Malthus to Ricardo1[answered By 81]
• Malthus to Horner4
• 81.: Ricardo to Malthus3[reply to 80.—ANSWERED By 82]
• 82.: Malthus to Ricardo2[reply to 81.—ANSWERED By 83]
• 83.: Ricardo to Malthus1[reply to 82.—ANSWERED By 84]
• 84.: Malthus to Ricardo3[reply to 83.—ANSWERED By 85]
• 85.: Ricardo to Malthus1[reply to 84.—ANSWERED By 86]
• 86.: Malthus to Ricardo1[reply to 85.—ANSWERED By 87]
• 87.: Ricardo to Malthus2[reply to 86.—ANSWERED By 88]
• 88.: Malthus to Ricardo1[reply to 87.—ANSWERED By 89]
• 89.: Ricardo to Malthus1[reply to 88.—ANSWERED By 90]
• 90.: Malthus to Ricardo1[reply to 89]
• 91.: Ricardo to Malthus1[answered By 92]
• 92.: Malthus to Ricardo3[reply to 91.—ANSWERED By 93]
• 93.: Ricardo to Malthus1[reply to 92.—ANSWERED By 94]
• 94.: Malthus to Ricardo2[reply to 93]
• 95.: Malthus to Ricardo1[answered By 96]
• 96.: Ricardo to Malthus1[reply to 95]
• 97.: Malthus to Ricardo1
• 98.: Ricardo to Murray1
• 99.: Malthus to Ricardo1[answered By 100]
• 100.: Ricardo to Malthus1[reply to 99.—ANSWERED By 101]
• 101.: Malthus to Ricardo1[reply to 100.—ANSWERED By 103]
• 102.: Trower to Ricardo1
• 103.: Ricardo to Malthus1[reply to 101.—ANSWERED By 110]
• 104.: Grenfell to Ricardo1
• 105.: Whishaw to Ricardo2
• 106.: Say to Ricardo1[answered By 107]
• 107.: Ricardo to Say1[reply to 106.—ANSWERED By 117]
• 108.: Ricardo to [say]1[answered By 117]
• 109.: Mill to Ricardo5[answered By 114]
• 110.: Malthus to Ricardo1[reply to 103.—ANSWERED By 116]
• 111.: Grenfell to Ricardo1
• 112.: Grenfell to Ricardo1[fragment]
• 113.: Grenfell to Ricardo1
• 114.: Ricardo to Mill3[reply to 109.—ANSWERED By 134]
• 115.: Grenfell to Ricardo1
• 116.: Ricardo to Malthus2[reply to 110.—ANSWERED By 126]
• 117.: Say to Ricardo1[reply to 107 & 108]
• Say to Ricardo
• 118.: Grenfell to Ricardo1
• 119.: Grenfell to Ricardo1
• 120.: Trower to Ricardo1[answered By 136]
• 121.: Grenfell to Ricardo1
• 122.: Grenfell to Ricardo1
• 123.: Grenfell to Ricardo1
• 124.: Grenfell to Ricardo1
• 125.: Grenfell to Ricardo1
• 126.: Malthus to Ricardo5[reply to 116.—ANSWERED By 127]
• 127.: Ricardo to Malthus1[reply to 126.—ANSWERED By 128]
• 128.: Malthus to Ricardo1[reply to 127.—ANSWERED By 130]
• 129.: Malthus to Ricardo1[answered By 130]
• 130.: Ricardo to Malthus1[reply to 128 & 129.—ANSWERED By 137]
• 131.: Malthus to Ricardo2[answered By 132]
• 132.: Ricardo to Malthus1[reply to 131.—ANSWERED By 137]
• 133.: Grenfell to Ricardo1
• 134.: Mill to Ricardo1[reply to 114.—ANSWERED By 135]
• 135.: Ricardo to Mill1[reply to 134.—ANSWERED By 138]
• 136.: Ricardo to Trower2[reply to 120.—ANSWERED By 141]
• 137.: Malthus to Ricardo3[reply to 130 & 132]
• 138.: Mill to Ricardo2[reply to 135]
• 139.: Malthus to Ricardo1
• 140.: Ricardo to Mill2[answered By 142]
• 141.: Trower to Ricardo1[reply to 136.—ANSWERED By 147]
• 142.: Mill to Ricardo1[reply to 140.—ANSWERED By 143]
• 143.: Ricardo to Mill3[reply to 142.—ANSWERED By 145]
• 144.: Ricardo to Malthus1[answered By 148]
• 145.: Mill to Ricardo1[reply to 143.—ANSWERED By 149]
• 146.: Malthus to Ricardo1[answered By 150]
• 147.: Ricardo to Trower1[reply to 141.—ANSWERED By 154]
• 148.: Malthus to Ricardo1[reply to 144.—ANSWERED By 150]
• 149.: Ricardo to Mill1[reply to 145.—ANSWERED By 151]

18.

ricardo to perceval 1
[Answered by 19]

New Grove Mile end 27 ^th. July 1811

Sir

During the late discussions in Parliament on the subject of the Paper currency, you distinctly admitted that a reduction in the amount of Bank notes would increase their value, and would therefore lower the price of bullion, but you thought that such a reduction could not be effected without impairing our resources, cramping our trade, and distressing our commerce.2 It appears, then, that you acknowledge the truth of the principles advanced by the Bullion Committee but hesitate as to the expediency of the remedy which they have recommended. I will not trouble you, Sir, with my opinions on this subject; they are already before the public; but beg leave to suggest, for your consideration a measure, which, if adopted, I cannot help thinking would greatly tranquilise the public mind respecting the further depreciation of Bank notes. This measure appears to me to be in strict accordance with those principles to the truth of which you have given your sanction. Let the Bank be obliged to sell gold bullion, for their own notes, to any purchaser that shall apply for a quantity not less than 5 ounces, at the rate of £4.. 15 p^r. oz for standard bullion, and whatever the bullion so delivered by the Bank may arise from, whether from foreign coin, or from light guineas, let it be freely exportable at the will of the purchaser.

An enactment to this effect would secure the public against any depreciation of the currency beyond that to which it has already reached. The Bank would be at full liberty, at their leisure, and after the most mature consideration, to adopt such other means as might be necessary, when no danger should appear even to the most timid, gradually to reduce the amount of their paper within such limits, as should raise it to the actual value of the standard of the coin. If such a regulation were to take place much of the alarm which at present exists, and which cannot fail to increase, would subside; and though we should have to deplore that the denomination of the coin, had in effect, for a time at least, been raised from £3. 17. 10½ to £4.. 15 yet we should feel confidence as to the future, and should no longer be justly apprehensive that we were about to tread the same ruinous course that had involved the finances of other countries in irretrievable distress and difficulties. Neither could it in any way be considered as a hardship on the Bank, to subject it to such a regulation. Before the restriction they were actually obliged to sell gold to the public at £3. 17. 10½ p^r [oz.]1 , because at that rate they were obliged to furnish gold coin in exchange for their notes, and yet with the controul which their issues had on the price of gold, no practical inconvenience was suffered by them excepting in the year 1797, a period of great alarm, which occasioned a demand for gold for local purposes only, the exchange at the time being greatly in favour of England. Whilst the Bank have the power of limiting their issues of paper, they have the power of counteracting any tendency to a rise in the price of gold, whatever the demand for that article may be, either on the continent of Europe, or in any other part of the world.

If, Sir, you should deem it necessary, at the expiration of the bill which has just received the Royal assent,1 to make Bank notes a legal tender, a provision to the effect which I have suggested, would I am confident deprive such a measure of almost all its terrors, as it would give the public complete security against the further depreciation of Bank notes; without which they would have too much reason to fear, from their observations on the past, that the paper currency would continue progressively to sink in value. It is not necessary to point out the effects which will follow from such a conviction on all future leases and contracts.

I hope, Sir, you will pardon the liberty I am taking in addressing you on this subject, and I trust you will be assured that if my opinions are erroneous, they are at least the honest convictions of my mind, as I have no other interest in the correction of our present monetary system than that of all the other annuitants and Stock holders in the Kingdom.

I have the honour to be Sir Your obed^t. and humble Serv^t.

David Ricardo

The Right Honb^le. Spencer Perceval

[1 ]MS (a copy in Ricardo’s handwriting) in R.P.

Spencer Perceval was Prime Minister and Chancellor of the Exchequer from 1809 till 1812, when he was assassinated.—Early in 1810 Ricardo had sent him a copy of his High Price of Bullion, which was acknowledged by the following letter, dated ‘Downing Street 5th February 1810’ and signed by Thomas Brooksbank: ‘I am directed by Mr. Perceval to acquaint you that he has received your Letter to him of the 2nd Instant, and to return you his best thanks for the Book which accompanied it.’ (MS in R.P.)

[2 ]‘He did not differ from those gentlemen who maintained, as an abstract proposition, that a diminution of Bank paper would have a tendency to diminish the balance of exchange; it would produce that effect; but it would be at the expence of the most dreadful calamities to the country.’ (Perceval’s speech in the House of Commons on the Report of the Bullion Committee, 8 May 1811. Hansard, XIX, 1071–2.)

[1 ]Omitted in MS.

[1 ]Lord Stanhope’s Act, which in substance though not in name made bank-notes legal tender, was to remain in force during one year.