FORE:In the course of this commercial madness the imports greatly exceeded the exports, and there was consequently a rapid drain of specie from the country. The drain of bullion from the Bank of England was immense. In August, 1823, it had 12,658,240, which in August, 1825, was reduced to 3,634,320, and before the end of the year it ran as low as 1,027,000. Between July, 1824, and August, 1825, twelve millions of cash were exported from Great Britain, chiefly to South America. During the Revolutionary war, which had lasted for fourteen years, the capital of the country had been completely exhausted, while all productive labour had been abandoned. The unworked mines were filled with water. They were accessible, it is true, to English speculators, but they were worked exclusively with English capital. The South American mining companies were so many conduits through which a rapid stream of gold flowed from Great Britain. The catastrophe that followed took the commercial world by surprise; even the Chancellor of the Exchequer failed to anticipate the disaster. On the contrary, his Budget of 1825 was based upon the most sanguine expectations for the future, and on the assurance that the public prosperity was the very reverse of what was ephemeral and peculiar, and that it arose from something inherent in the nation. Even at the prorogation of Parliament in July, the Royal Speech referred to the "great and growing" prosperity on which his Majesty had the happiness of congratulating the country at the beginning of the Session. The commercial crisis, however, with widespread ruin in its train, was fast coming upon Britain. Vast importations, intended to meet an undiminished demand at high prices, glutted all the markets, and caused prices to fall rapidly. Merchants sought accommodation from their bankers to meet pressing liabilities, that they might be enabled to hold over their goods till prices rallied. This accommodation the bankers were unable to afford, and sales were therefore effected at a ruinous loss. The South American mines, it was found, could not be worked at a profit, and they made no return for the twenty million pounds of British money which they had swallowed up. The effect was a sudden contraction of the currency, and a general stoppage of banking accommodation. The country banks, whose issues had risen to 14,000,000, were run upon till their specie was exhausted, and many of them were obliged to stop payment. The Plymouth Bank was the first to fail, and in the next three weeks seventy banks followed in rapid succession. The London houses were besieged from morning to night by clamorous crowds, all demanding gold for their notes. Consternation spread through all classes. There was a universal pressure of creditors upon debtors, the banks that survived being themselves upon the edge of the precipice; and the Bank of England itself, pushed to the last extremity, peremptorily refused accommodation even to their best customers. Persons worth one hundred thousand pounds could not command one hundred pounds; money seemed to have taken to itself wings and fled away, reducing a state of society in the highest degree artificial almost to the condition of primitive barbarism, which led Mr. Huskisson to exclaim, "We were within twenty-four hours of barter."When Parliament met on the 20th of February, this conspiracy was laid before it and excited great indignation. The two Houses voted cordial addresses to his Majesty, and for a while there was an air of harmony. But the fires of discontent were smouldering beneath the surface, and, on a motion being made in April, in consequence of a royal message, to grant the king an extraordinary Supply in order to enable his Majesty to contract alliances with foreign powers, that he might be prepared to meet any attempts at invasion which the Swedes might, after all, be disposed to make, the heat broke forth. The Supply moved for was fixed at two hundred and fifty thousand pounds. It was expected that Walpole, having had his name suspiciously mentioned in Gyllenborg's correspondence, would take this opportunity to wipe off all doubt by his zeal and co-operation. On the contrary, he never appeared so lukewarm. Both he and his brother Horace, indeed, spoke in favour of the Supply, but coldly; and Townshend and all their common friends openly joined the Tories and Jacobites in voting against it; so that it was carried only by a majority of four. This could not pass; and the same evening Stanhope, by the king's order, wrote to Townshend, acknowledging his past services, but informing him that he was no longer Lord-Lieutenant of Ireland.
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