An enquiry into the disposal of the equivalent

An Enquiry into the Disposal of the Equivalent.

IT has been the Subject of Debate for sometime, now whether we should have an Equivalent in Scotland for such Payments as are to be made on a Coalition of the Nations? — but whether what was Proposed, was Equal, was really an Equivalent or no? And the World has been long hurried with these Enquities.

But now here arises a new Cloud, and tho' 'tis not only no bigger than a Mans Hand, but is never like to be bigger; yet as it is drest up, it threatens mighty things: and this is, what you shall do with the Equivalent when you have it.

'Tis a little hard, People that cry up your National Sagacity, in their Arguments against an Equivalent in general, should question your Sagacity in knowing what to do with the Money when you have it.

To Answer therefore the Doubts of some, and prevent the Objections of others, I shall enter a little briefly on an Enquiry into the manner of disposing the Equivalent you are to have; or, in short, Enquire how you shall employ the Money when it comes.

And in general, as to this Head, I think the nature of the Payment it self, and the very words of the Treaty direct Us to the use to which this Money is to be employ'd, viz. An Equivalent.

The Property here will have no alteration in its Denomination, it remains an Equivalent to its last Circulation into the Chaos of the current Cash of Britain; you receive it as an Equivalent, and you pay it as an Equivalent, 'tis an Equivalent pay'd you for Money, which by your Customs and Excises will of course be appropriated to the uses of another Nation after the Union, which Nation therefore advances you the Sum in specie, that you may not be out of Purse on their Account.

When you have it, you dispose of it.

1. As an Equivalent to the African-Company for the demise and dissolution of their Society, there being Companies in England already embark'd in those Trades, and double Companies having prov'd incompatible, as in the two East-India-Companies, who if they had remain'd ununited to this time, had been both ruin'd: And the Members of this Company having by the Union full leave to come in to the said English Company, as freely, and on the same Conditions as Englishmen may, It is agreed the Scots Company shall cease, and for a Satisfaction, the first part of the Equivalent is appropriated to be an Equivalent for the said Company, by paying the Subscribers their Principal and Interest, and so 〈◊〉 •ompany expiring, sets them down just where it took them up, and I think they ought to esteem it a very happy Landing, and what without the Assistance of England they could not have obtain'd by Trade in 20 Years.

2. Another Head for the disposing this Money, is as an Equivalent for the Coin, which by the Treaty is to be reduced to the Standard of the English Money.

I shall say very little to a Gentlemans Paper, who is for having this Equivalent made good before that to the African Company, as a thing of vast Moment to the Nation.

If I understand the Dispute, one previous Question well discuss'd, will effectually Answer all his Objections; and that is, Whether there is not enough in the Equivalent, that Englond is to Pay, to Discharge both, and if that be true, the mighty Dispute drops of course, and it is not one Farthing matter which of these two go first.

I cannot but think the Gentleman that wrote that Sheet, went on a Calcul of the Coin as false, as he has done of the Equivalent it self, where he mistakes Ninety Thousand Pound atone Clap, and no wonder he is in such concern, since he has lost such a Sum out of the whole, just at his first setting out, for he says, 'tis 309885 l. 10 s. and the several Times, whereas if I think right, 'tis just 398085 l. 10 sh.

I shall therefore attempt here two things, 1. Examine what the species of Coin are that are to be reduced. And 2ly To make a probable conjecture at the Deficiency.

For the species, I shall observe the words of the Treaty say, not the current Money in Scotland, but the current Coin of Scotland, and this distinction will immediatly lead me to this Negative.

That you are not to imagine, as some have very grosly done, that the Forreign Coins, which the Error of Custom, the Disaster of Trade, and the Searcity of Bullion, have made current here at an extravagant rate, should be brought into your Mint and be recoin'd; and the Owner of such Money be allow'd the difference from the Rate of their present Valuation to the Price of that new Standard—, let no Men flatter themselves with such a Notion, if this were true, it would not only expose Scotland to innumerable Incoveniencies, but might indeed soon eat up the whole Equivalent; since as there must be a certain stated time given for bringing in the Money into the Mint, all the Rix Dollars in Europe might be brought into Scotland, the difference between their real and imaginary Value, be paid in specie by the Publick, and the Owner receive the new Money for the Remainder, which difference would make it very well worth while, to bring the Dollars from Abroad, and carry back the British Crowns in their Room, or may lay out the Money in any part of Britain in Manufactures, Corn or Lead, and carry them cheaper to Market than any Native of Britain can do it, his Money costing him less than theirs does.

This was exactly the Case in England, when Guineas rose from 21 s. 6 d. each to 30. The Merchants in Holland & Hamburgh immediatly fall to buying of Gold, and send it to England by all possible Conveyance, so much as by the very Post, and such was the hurry, that had it held much longer, all the Gold in Europe would have flow'd into England.

The Consequence of this was, that the English Merchants were struck out of their own Trade. A Dutch Merchant could buy Bayes at Colchester, or Sarges at Exeter, and send them to Spain, and sell 10 per Cent. cheaper than the English Merchants that liv'd at the same Town: The Case was plain, the Gold which in Holland stood them in 4 l. to 4 l. 7 s. 6 d. and tho' at last it rise up to 5 l. per Ounce, yet in England went for above 6 Pound, and so their Money cost them 25 per Cent. less than the English Merchant could buy for.

From this Example I think 'tis evident, that the Forreign Coin has no concern in this Reduction.

If it had been answered, that this then will be an immediate Loss to the Nation, and to private Persons also: I Answer,

To the Nation it can be no Loss, because, when ever such Pieces came into Scotland, the imaginary Value was an Addition to its real Value; and so raised its Currency to the Credit of the general Stock: And when ever it goes away again, the Difference is only an imaginary Diminution, and stands to the Debit of the publick Stock in the same manner; and the general Value of Scotland receives no real Alteration.

Money is a real intrinsick Species appointed by Custom, as the Medium of Trade to bring Commerce in all its particular States to a Ballance—So much as its real Value amounts to, so much real Wealth is in that Nation, and this real Value is every where the same; But its Received Value differs in the several Nations, according to the particular Circumstances of those Nations, as to Coin, Standards, Plenty or Scarcity of Money.

These Differences are again reconcil'd among Merchants, and all is brought to PAR in their Negotiating, by adding or diminishing, as the imaginary Differences in Value require between Nation and Nation, or Port and Port, and this is called Exchange, a thing full of Nicety, and which I take to be the best Accomplishment of a compleat Merchant.

'Tis true the Rates of Exchange differ, rise and fall, according to the Quantities of Money that lye to Draw or to Remitt: But this is a thing that depends so much on the Artifice of the Merchant or Exchanger, that it has little regard to the real Differences of the Species; and therefore it is not to my purpose.

2. The next Negative relates to the Coin of England, which is now current here, such as Guineas of Gold and Silver Pieces, of the Crown, Half Crown, Shilling and Sixpence; These I presume shall find no Alteration here, and being the same to which the Coin of Brittain is to be reduced, there can be no melting them down, for that would be to do nothing at all, but melt the Half Crown into Half a Crown, and a Shilling into a Shilling, and so on.

As to the Loss upon this Money, it is impossible to have it Rectified by any Law, or any just Equivalent given for it; Since, should any time be given for that, it would make a wild Trade to fetch a Million or two of it from England, carry it into the Mint, demand 1 d. per Shilling, and immediately carry back the very same Species again.

I confess I should have thought these Negatives of no Use, had I not seen abundance of People weak enough to imagine they should receive Satisfaction here from the Publick for all the Deficiency of the imaginary Value of Forreign Money.

I could spend some time to shew Examples, but I think it needless; England made three Essays about Money, and these are Examples enough; in two of them they made no Equivalent for Loss, and in the third they did, and they exactly hit the Case.

First, They reform'd the Guineas, and gave no Equivalent for the Loss; they sunk them from 30 to 22 shil. each at one Blow, and some rich Engrossers of those pleasant Manufactories lost great Sums of Money by it.—The Reason was plain, it was a Distemper in Trade, and wanted a Cure, every Man had a Share in the Benefit at first, and every Body ought to bear their Share of the Burden, and take their Chance for their Particulars.

Another time, the Parliament finding Trade opprest by a Flux of French Pistoles, reduc'd them to 17 shil. each, and for this there was no Equivalent offered, for the Evil was of the same Original.

And here by the way I must Note, That it was not a Mischief to England to have a Flux of Gold, either Guineas or Pistoles; Nor can it be to Scotland, if SHE had ten Millions of Dollars among her current Money; But the Evil is, these several Coins going There or HERE at an Advance in Price, by which Your Neighbours always have this Advantage, That They draw Your Goods away at the Price of all that imaginary Value.

At last the Parliament of England fell to work with their own Coin, Reduc'd it all to the Standard, and Recoin'd it; And then they allow'd an Equivalent to the Proprietor—Because now they did not Reduce advanc'd Value, but took in the very Species; At which time Clipping, Counterfeiting, and such like Abuses had made it really Deficient in the Species: This the Government was obliged to, and so in Scotland it will be of Course.

Now, the Gentleman that Quarrels at this, argues, this is a mighty Concern, and is angry 'tis put off to the last, or Excrescence, as he calls it of the Equivalent, since 'twill Ʋndoubtedly be an Ʋnknown and Insupportable Loss and Hazard to the Nation.

Now, not to spend time to be merry upon the blunder of the Loss, being insupportable first, and then unknown; I would be glad this insupportable Burden might be examined, and I'll go the nearest way to it that I can.

It is plain none but the Coin is to be reduced, and when all the present Coin is call'd in, I believe no Man will say it is likely it should amount to 100000 lib. Sterling in Silver.

Of this a great part is in the new Coin, 5 d. 10 d. 20 d. 40 d. Pieces, and of these there can be no Loss, if the Gentlemen who have carried so great a Quantity Abroad lately in specie should be pleased to carry away a few more, there would be so few left as would effectually take off the Loss on that Head.

As to the old 14 sh. Pieces, and 7 d. and 3 d. and 3 d. Half Penny, the Quantity is very small, and all the rest is Copper-Money, the deficiency of which cannot be much. And upon the whole, if this Gentleman will please to procure a Tack or Farm upon this Casuality, I shall at any time bring him People, that giving unquestionable Security to the Government, shall undertake all the Loss and Deficiency, and make it good to Scotland, the Coinage excepted, on the whole Coin of Scotland for 30000 lib. Sterling.

If this be so then, the mighty weight of insupportable Loss is at an end.

I know it is enquir'd here, Whether on reducing the Coin to the Standard, the Prices of Goods, Labour, &c. shall not fall in all places, and so Scotland suffer a Loss here, which may be indeed insupportable, and tho' I know a long Answer is expected to this, mine will be very short.

I Answer, This is no Loss at all, for this only Reason.

There is a sinking the imaginary Value indeed, but no sinking the real Value.

The Species is not debased, nor your Standard allayed, and therefore tho' your Goods, Manufactories and Labour seem to sink, they really do not sink.

'Tis true you shall buy as much for 12 d. then as you do for 13 d. now, but that you buy for 12 d. now, shall sell for as much Abroad as that you bought for 13 d. before, and you shall remit Home at the same Price too.

The Poor Man shall Labour as much now for 12 d. as he did before for 13 d. but then his 12 d. shall now buy as much Provision for his Family as his 13 d. would do before.

The Landlord shall receive but 12 d. for his Farm, that before pay'd him 13, but he shall buy as many Horses or Houses, Lands or Goods for his 12 d. as he could before for his 13 d. so that every way the Intrinsick remains the same, and the Nation has no Loss.

In Forreign Exchanges it is the same, your Value is all over the World the same, from England you shall draw without Gain, but then you remit without Loss, and which way soever you turn as to Ballance of Exchange, 'tis the same thing, because the intrinsick Value of the species remains the same.

All the imaginary Inconveniencies about the Coin, with respect to the time of Coinage, may as effectually be Answered as this: And the Practice in England is a Precedent to go by, if the Currency of the Mint be supported by a small Sum of new Money before Hand, there can be no inconvenience of time or stop of species, & therefore the sad Complaint the Author of that Sheet makes of Forreign Bills being Protested, or Landlords ruining the poor Tennent for want of species of current Money, is at an end.

Indeed if the old Money was to be call'd in before the new Money was to be given out, there might be some stop, and for want of Money Trade might suffer some Inconvenience, Bills be Protested, and the like.

But 'tis but keeping the old Money current till the gross of the new Money be delivered out, it will circulate insensibly, and not the least sensible hesitation be felt.

FINIS.

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An enquiry into the disposal of the equivalent

Defoe, Daniel, 1661?-1731.

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http://ota.ox.ac.uk/id/3380

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1106003799

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9781106003799

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K004390.000

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CW3306554052

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— An enquiry into the disposal of the equivalent, Defoe, Daniel, 1661?-1731.. 8p. ; 4⁰. [Edinburgh,. 1706]. [Attributed to Daniel Defoe.] [On the effect of the union of Scotland with England upon the currency of the former.] [Drop-head title.] [Publication place and date from Moore.] [Reproduction of original from the University of London's Goldsmiths' Library.] [Moore, 136] [Hanson, 632] [Goldsmiths', 4301] [English Short Title Catalog, ESTCN7322.] [Electronic data. Farmington Hills, Mich. : Thomson Gale, 2003. Page image (PNG). Digitized image of the microfilm version produced in Woodbridge, CT by Research Publications, 1982-2002 (later known as Primary Source Microfilm, an imprint of the Gale Group).]

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