A.D. 1776 
—1850 
which 
ended to 
arse 
jeneral 
prices and 
reduce the 
purchasing 
power of 
wages. 
The 
authorities 
of the 
Bank con- 
tested the 
fact of de- 
preciation 
700 LAISSEZ FAIRE 
sonsequences too obvious to require proof, and too repugnant 
ho justice to be left without remedy. By far the most 
‘mportant portion of this effect appears to Your Committee 
to be that which is communicated to the wages of common 
sountry labour, the rate of which, it is well known, adapts 
itself more slowly to the changes which happen in the value 
of money, than the price of any other species of labour or 
sommodity. And it is enough for Your Committee to allude 
o some classes of the public servants, whose pay, if once 
raised in consequence of a depreciation of money, cannot so 
sonveniently be reduced again to its former rate, even after 
money shall have recovered its value. The future progress of 
shese inconveniences and evils, if not checked, must at no 
great distance of time work a practical conviction upon the 
minds of all those who may still doubt their existence!” 
Curiously enough, controversy raged for many years on 
the simple matter of fact as to whether the notes of the Bank 
of England had depreciated or not. There was no doubt that 
the value of notes relatively to gold had changed; and that 
whereas the Mint price of gold ought to be £3. 17s. 104d. an 
ounce, the market price in 1810 had risen to £4. 10s. 0d.3, 
while the rates of exchange with Hamburg had fallen 9 per 
sent. and with Paris 14 per cent. The Directors of the Bank 
of England, the Government of the day, and the mercantile 
jommunity generally were of opinion that there had been no 
lepreciation of notes up to 1810, but that gold had been 
rery scarce and had risen in value. On the other hand the 
sxperts, who sat on the Bullion Committee of the House of 
Commons, were clear that the monetary phenomena of the 
day, and especially the foreign exchanges, were inexplicable on 
any other hypothesis than that of the depreciation of the 
circulating medium. Even as late as 1819* the majority of 
the Directors adhered to the view which the Bank had 
persistently maintained, that since the public were always 
ready to accept their notes there could not be a real depreci- 
ation of value. According to their opinion, the fact that 
tL Report from the Select Committee on the High Price of Gold Bullion, in 
Reports, 1810, p. 31. 
} McLeod, Theory and Practice of Banking, mm. 29. 
3 McLeod. Theory and Practice, 11. 80.