Sect. VII.—: Standard of Money. Duodecimal and Decimal systems of dividing Coins. Degradation of Coins in Rome, France,

By the standard of money is meant the degree of the purity or fineness of the metal of which coins are made, and the quantity or weight of such metal in them. A pound troy, or twelve ounces of the metal in English silver coins, contains 11 ounces 2 dwts. fine silver, and 18 dwts. alloy. And this standard pound, or pound sterling, is coined into 66 shillings; which, consequently, contain 20/66 parts of 11/12 of a pound troy, or 1614·545 grains fine silver. From the 43 of Elizabeth down to 1816, when the 56th Geo. III. cap. 68, imposing a seignorage of about six per cent. on the silver coin, was passed, the pound weight of standard silver bullion was coined into 62 shillings. All English silver coins have been coined out of silver of 11 oz. 2 dwts., fine, from the Conquest to this moment, excepting for a period of sixteen years, from 34th Henry VIII. to the 2d Elizabeth.

The purity of gold is not estimated either in Great Britain, or in most other European countries, by the weights commonly in use, but by an Abyssinian weight called a carat. The carats are subdived into four parts, called grains, and these again into quarters; so that a carat grain, with respect to the common divisions of a pound troy, is equivalent to 21/2 penny-weights. Gold of the highest degree of fineness, or pure, is said to be 24 carats fine. When gold coins were first struck at the English mint, the standard of the gold in them was 23 carats 31/2 grains fine, and one-half grain alloy; and so it continued, without any variation, till the 18th Henry VIII., when a new gold standard of 22 carats fine, and two carats alloy was introduced. The first of these was called the old standard; the second, the new standard or crown gold, because crowns, or pieces of the value of five shillings, were first coined of this new standard. Henry VIII. made his gold coins of both standards; and this practice was continued by his successors till 1633. But from the latter period to the present, gold coins have been invariably of the new standard, or crown gold. Some coins of the old standard continued to circulate till 1732, when they were forbidden to be any longer current.

The standard of our present gold coins is, therefore, eleven parts of fine gold, and one part of alloy. The pound troy of such gold is divided into 4689/129 sovereigns, each of which ought, consequently, when fresh from the mint, to weigh 1/4689/129 of twelve ounces, or five dwts. 3171/623 grains standard gold, or four dwts. 1718/11214 grains pure gold.

The alloy in coins is reckoned of no value. It is allowed, to save the trouble and expense that would be incurred in refining the metals so as to bring them to the highest degree of purity; and because, when its quantity is small, it renders the coins harder, and less liable to be worn or rubbed. If the quantity of alloy were considerable, it would lessen the splendour and ductility of the metals, and would add too much to the weight of the coins.

The pound sterling, represented by the sovereign, is the integer or unit of currency in England; it being subdivided into twenty shillings, each shilling into twelve pence, and each penny into four farthings. Latterly, however, this system, notwithstanding its many recommendations, has been a good deal objected to; and various proposals have been made for substituting in its stead a coinage on the decimal plan. Most part of these proceed on the assumption that the pound is to be maintained as the integer, it being subdivided into tenths, hundredths, and so on, as in the French coinage. But there would be no little difficulty in carrying out a project of this sort. Shillings (two to be called a florin) might be continued in the new coinage; but pence and farthings would have to be discarded. This is evident from the following comparison:—

At present £1 = 20 shillings = 240 pence = 960 farthings. Proposed plan £1 = 10 fl. (each = 2 sh.) = 100 cents = 1000 mills.

Now, as cents and mills are neither equivalent to, nor whole multiples of pence and farthings, it would be impracticable accurately to adjust to the new scale the prices of such articles, duties, or services as are wholly or partly rated in pence and farthings. It is evident, for example, inasmuch as mills would be four per cent. less valuable than farthings, that those retailers, of whom there are many, who supply the poor with small quantities of the various articles priced in farthings, could not accept mills in their stead without incurring a heavy loss. And if, as is most likely, they attempted to right themselves by charging two mills for a farthing, and three cents for a penny, serious injury would be inflicted on those who dealt with them. But, suppose that this difficulty is got over, and that prices are one way or other adjusted to the new scale, the question remains, Would the change be advantageous? And, despite all that has been alleged in its favour, we are satisfied that it would not.

The object of coins is twofold, viz., 1st., to serve as standards of value, and, 2d, to facilitate exchanges. With respect to the first of these functions, it is of no consequence how coins are subdivided, the grand requisite being that their weight and purity should be preserved inviolable, and that the substitutes used in their stead should be immediately convertible into them. In their second function, or as instruments for facilitating exchanges, coins are very little used in transactions of £5 and upwards, these being mostly settled by the intervention of notes and cheques. But coins, especially shillings, pence, and farthings, are of universal use in retail dealings; and these form the vast majority, nineteen twentieths or more of the ordinary business of society. Hence, if a system of coinage be well fitted for such dealings, it matters little whether it be equally well suited to those large transactions in which coins are seldom or never employed. It is easy, however, to see that shillings, or coins of twelve parts, are much better adapted to the retail trade than florins or coins of ten parts. The former are divisible without fractions by six, four, three, and two, whereas the latter are divisible only by five and two. We are constantly buying or dealing in the thirds, the quarters, and so on of different articles; but with a decimal division of the integer, this would sometimes be impracticable and sometimes difficult; for we could not pay the price of a third, two thirds, or a sixth of anything, nor could we pay for a fourth, an eighth, &c., without introducing inconvenient fractions. In so far, therefore, as retail transactions are concerned, a duodecimal is at once seen to be decidedly preferable to a decimal scale. The superiority of the latter consists, if at all, in its affording greater facilities for the keeping of books and accounts. And this advantage, supposing it to be real, is of trivial importance compared with the other. Few individuals keep books or accounts, whereas everybody, the rich as well as the poor, but especially the latter, have innumerable, daily, and almost hourly transactions, which being adjusted viva voce, are concluded by the delivery of small coins. Our readers may not, perhaps, be generally aware of the fact that a considerable portion of the tea and sugar sold in London and other great towns is retailed in ounces, in the payment of which farthings are frequently required. Tobacco and snuff are, also, almost wholly disposed of in this way, and it is partially or wholly the case with other important articles.

Unless, therefore, the interests of the many be sacrificed, without scruple or equivalent, to the interests of the few, the existing coinage regulations must be upheld. The advantages on their side are quite preponderating. Nothing can be better suited than the duodecimal scale to the exigencies of the great bulk of society, whereas the decimal scale is, at best, suited only to what is a comparatively small body of clerks and accountants.

And, even in the case of the latter, it is the easiest thing imaginable for those who prefer keeping books and accounts on the decimal plan to do so at present. The keepers of such books would soon come to recollect the decimals for all the principal subdivisions of a pound. And, were a table of such equivalents affixed to their desks, they might, when they happened to be at fault, by looking into it, find the desired figures at a glance.

Besides being best fitted to secure the principal advantages to be derived from the use of coins, our present system has the further and most important recommendation that it is in operation, and that all classes, even those who can neither read nor write, are familiar with its divisions, and employ it with the greatest ease and expedition. It would be extremely difficult to subvert an established system of this sort to make room for one of less easy application, abounding in outlandish terms, and to which every body would be a stranger. Even in France, where the most sweeping of revolutions paved the way for the decimal system, it has had to be materially modified, and is not yet fully introduced.

But the change, how inconvenient soever, might be submitted to, were it certain to be in the end advantageous. When, however, the reverse is the case, when the change would be alike undesirable and inconvenient, it would be worse than foolish to disturb the existing arrangements.

Having thus ascertained what the standard of money really is, and how coins may be best divided, we proceed briefly to inquire into the effects produced by the depreciation of the latter. This is a very important inquiry, both in a practical and historical point of view.

Directly to alter the terms of the contracts between individuals, would be too barefaced and tyrannical an interference with the rights of property, to be tolerated. Those, therefore, who endeavour to enrich one part of society at the expense of another, find it necessary to act with caution and reserve. Instead of changing the stipulations in contracts, they have resorted to the ingenious device of changing the standard by which these stipulations are adjusted. They have not said, in so many words, that ten or twenty per cent. should be added to, or deducted from, the debts and obligations of society, but they have, nevertheless, effected this by making a proportional change in the value of money. Men, in their bargains, do not, as has been already seen, stipulate for signs or measures of value, but for real equivalents. Money is not merely the standard by a comparison with which the values of commodities are ascertained; it is also the equivalent, by the delivery of a specified amount of which the stipulations in most contracts and engagements may be discharged. It is plain, therefore, that it cannot vary without affecting these stipulations. Every addition to its value makes a corresponding addition to the debts of the state and of individuals; whereas every diminution of its value makes a corresponding diminution of these debts. Suppose that, owing to an increase in the cost of gold and silver, or in the quantity of bullion contained in coins of the same denomination, the value of money is raised ten per cent.: it is plain that this will add ten per cent. to the various sums which one part of society owes to another. Though the nominal rent of the farmer, for example, continues stationary, his real rent is increased. He pays the same number of pounds, or livres, or dollars, as formerly; but these have become more valuable, and require, to obtain them, the sacrifice of a tenth part more corn, labour, or other things, the value of which has remained stationary. On the other hand, had the value of money fallen ten per cent., the advantage would have been wholly on the side of the farmer, who would have been entitled to a discharge from his landlord, when he had paid him only nine-tenths of the rent really bargained for.

But, though it be thus obviously necessary, to prevent a pernicious subversion of private fortunes, and the falsifying of all precedent contracts, that the standard of money, when once fixed, should be maintained inviolate, there is nothing which has been so frequently changed. We do not now allude to variations in the value of bullion itself, against which it is impossible to guard, but to variations in the quantity of bullion contained in the same nominal sums of money. In almost every country, debtors have been enriched at the expense of their creditors. The necessities, or the extravagance of governments, have forced them to borrow. And to relieve themselves of their encumbrances, they have almost universally had recourse to the disgraceful expedient of degrading or enfeebling the coin; that is, of cheating those who had lent them money, and of enabling every private debtor in their dominions to do the same by his creditors.

The ignorance of the public in remote ages facilitated this variety of fraud. Had the names of the coins been changed when the quantity of metal contained in them was reduced, there would have been no room for misapprehension. But, though the weight of the coins was undergoing perpetual, and their purity occasional, reductions, their ancient denominations were almost uniformly preserved. And those who saw coins of a certain weight and fineness circulate under the names of florins, livres, and pounds, and who saw them continue to circulate as such, after both their weight and their fineness had been lessened, began to think that they derived their value more from the stamp affixed to them by authority of government, than from the quantity of the precious metals which they contained. This was long a very prevalent opinion. But the rise of prices which invariably followed every reduction of the standard, and the disturbance which it occasioned in every pecuniary transaction, undeceived the public, and taught them, though it may not yet have taught their rulers, the expediency of preserving the standard of money inviolate.

Before proceeding to notice the changes made in the currency of this and other countries, it may be proper to observe that the standard is generally debased in one or other of the undermentioned ways.

First, by altering the denominations of the coins, without making any alteration in their weight or purity. Thus, suppose sixpence, or as much silver as there is in a sixpence, were called a shilling, then a shilling would be two shillings, and twenty of these shillings, or ten of our present shillings, would make a pound sterling. This would be a reduction of fifty per cent. in the standard.

Secondly, the standard may be reduced, by continuing to issue coins of the same weight, but making them baser, or with less pure metal and more alloy.

Thirdly, it may be reduced by making the coins of the same degree of purity, but of diminished weight, or with less pure metal; or it may be reduced partly by one of these methods, and partly by another.

The first of these methods of degrading the standard was recommended by Mr. Lowndes in 1695; and if injustice is to be done, it is, on the whole, the least mischievous mode in which it can be perpetrated. It saves all the trouble and expense of a recoinage; though, as it renders the fraud too obvious, it has been but seldom resorted to. But in inquiries of this kind, it is rarely necessary to investigate the manner in which the standard has been degraded. And by its reduction or degradation, is usually meant a diminution of the quantity of pure metal contained in coins of the same denomination without regard to the mode in which it may have been effected.

Conformably to what has been observed in the first section of this treatise, relative to the universality of the ancient practice of weighing the precious metals in every exchange, it is found that the earliest coins of most countries had the same names and were of the same ponderosity as the weights commonly used in them. Thus, the talent was a weight used in the earliest periods by the Greeks, the as or libra by the Romans, the livre by the French, and the pound by the English, Scotch, &c.; and the coins originally in use in Greece, Italy, France, and England, received the same denominations, and weighed a talent, a libra or pondo, a livre, and a pound. The standard has not, however, been preserved inviolate, either in ancient or modern times. But to attempt to trace these changes with any degree of minuteness, would lead us into too many details; and we shall content ourselves with referring to those only which seem to be of most importance.

Roman Money.—We learn from Pliny, that the first Roman coinage took place in the reign of Servius Tullius; that is, according to the common chronology, about 550 years before Christ. The as, or libra, of this early period, contained a Roman pound of copper, the metal then exclusively used in the Roman coinage, and was divided into twelve parts or unciæ. If we may rely on Pliny, this simple and natural system was maintained until 250 years before our æra, or until the first Punic war, when the revenues of the state being insufficient, it was attempted to supply the deficiency, by reducing the weight of the as from twelve to two ounces. But it is extremely improbable that a government, which had maintained its standard inviolate for 300 years, should have commenced the work of degradation, by at once reducing it to a sixth part of its former amount; and it is equally improbable that so sudden and excessive a reduction should have been made in the value of the currrent money of the state, and, consequently, in the debts of individuals, without occasioning the most violent commotions. Nothing, however, is said in any ancient writer to entitle us to infer that such really took place; and we, therefore, concur with those who think that the weight of the as had been previously reduced, and that its diminution, which, it is most probable, would be gradual and progressive, had merely been carried to the extent mentioned by Pliny during the first Punic war. In the second Punic war, or 215 years bc, a further degradation took place, and the weight of the as was reduced from two ounces to one ounce. And by the Papyrian law, supposed to have passed when Papyrius Turdus was tribune of the people, 175 years bc, the weight of the as was reduced to half an ounce, or to 1-24th part of its ancient weight, at which it continued till Pliny’s time, and long afterwards.

The denarius, the principal silver coin in use amongst the Romans for a period of 600 years, was coined five years before the first Punic war, and was, as its name imports, rated in the mint valuation at ten asses. Mr. Greaves, whose dissertation has been deservedly eulogised by Gibbon, shows that the denarius weighed at first only one-seventh part of a Roman ounce, which, if Pliny’s account of the period when the weight of the as was first reduced be correct, would give the value of silver to copper in the Roman mint as 840 to 1, which Greaves very truly calls a “most unadvised proportion.” But if we suppose with Pinkerton, that, when the denarius was first issued, the as only weighed three ounces, the proportion of silver to copper would be as 252 to 1—a proportion which, when the as was soon afterwards reduced to two ounces, would be as 168 to 1, or about a third more than in the British mint. When, in the second Punic war, the as was reduced from two ounces to one, the denarius was rated at sixteen asses.

During his stay in Italy, Greaves weighed many consular denarii; that is, as he explains himself, denarii which were struck after the second Punic war and previously to the government of the Cæsars; and he found, by frequent and exact trials, that the best and most perfect of them weighed 62 grains English troy weight. Now, as the English shilling (new coinage) contains very nearly 871/4 grains standard silver, this would give 81/2d. for the value of the consular denarius. We should, however, fall into the greatest mistakes, if we indiscriminately converted the sums mentioned in the Latin authors by this or any other fixed proportion. It is not enough to determine the real value of a coin, to know its weight: the degree of its purity, or the fineness of the metal of which it is made, must also be known. But Greaves assayed none of the denarii which he weighed. And though it were true, as most probably it is, that, from the first coinage of silver in the 485th year of the city to the reign of Augustus, the weight of the denarius remained constant at 1/7th part of a Roman ounce, or about 62 grains; and that, from the reign of Augustus to that of Vespasian, it only declined in weight from 1/7th to 1/8th of an ounce; still it is abundantly certain that its real value was reduced to a much greater extent. The authority of Pliny, in this respect, is decisive; for he states that Livius Drusus, who was tribune of the people in the 662nd year of the city, or 177 years after the first coinage of silver, debased its purity, by alloying it with 1/8th part of copper. And, in a subsequent chapter (the ninth) of the same book, he informs us that Antony the triumvir mixed iron with the silver of the denarius; and that, to counteract these abuses, a law was afterwards made, providing for the assay of the denarii. Some idea of the extent to which the purity of the coins had been debased, and of the disorder which had in consequence been occasioned, may be formed from the circumstance, also mentioned by Pliny, of statues being everywhere erected in honour of Marius Gratidianus, by whom the law for the assay had been proposed. But this law was not long respected; and many imperial denarii are now in existence, consisting of mere plated copper.

Gold was first coined at Rome sixty-two years after silver, in the 547th year of the city, and 204 years bc The aureus originally weighed 1/40th part of the pondo, or Roman pound; but, by successive reductions, its weight was reduced, in the reign of Constantine, to only 1/72nd part of a pound. The purity, however, as well as the weight of the aureus, was diminished. Under Alexander Severus it was alloyed with ⅕th part of silver. We learn from Dion Cassius, a contemporary of Severus, that the aureus was rated at twenty-five denarii, a proportion which Pinkerton thinks was always maintained under the emperors.

The want of attention to this progressive degradation, has led the translators of ancient writers and their commentators to the most erroneous conclusions. The sestertius, or money unit of the Romans, was precisely the fourth part of a denarius. When, therefore, the latter was worth 81/2d., the former must have been worth 21/8d. But the sestertius being thus plainly a multiple of, and bearing a fixed and determined proportion to the denarius, and consequently to the as, the aureus, and the other coins generally in use, it would partake of their fluctuations. When they were reduced, it would be likewise reduced; for had it not, or had the number of degraded denarii and aurei contained in a given sum of sestertii been increased in proportion to their degradation, nothing, it is obvious, would have been gained by falsifying the standard. Inasmuch, however, as we know that on one occasion the republic got rid of half of its debts, dimidium lucrata est, by simply reducing the standard of the as, the value of the sestertius must have fallen in the same proportion, just as in England we should reduce the pound sterling by reducing the shillings of which it is made up.

Arbuthnot’s “Tables of Ancient Coins,” which, for a lengthened period, were considered of high authority, are constructed on the hypothesis that the consular denarii weighed by Greaves were of the same purity as English standard silver, and that no subsequent diminution was made either in their weight or fineness. The conclusions derived from such data, though differing in degree, are of the same character as those which we should arrive at, if, in estimating the value of the pound sterling during the last hundred years, we took for granted that it contained a pound weight of standard silver, as in the period from the Conquest to the reign of Edward I. And, in addition to this source of error, the sums in ancient writers were, probably, at first set down with little regard to accuracy; and they have been peculiarly obnoxious to error from the carelessness of copyists and transcribers. But, however explained, many of the statements in the classics, as rendered by Arbuthnot and others, are quite incredible. Thus, we are told that Julius Cæsar, when he set out for Spain, after his prætorship, was £2,018,229 sterling worse than nothing; that Augustus received, in legacies from his friends, £32,291,666; that the estate of Pallas, a freedman of Crassus, was worth £2,421,875, and, which is still better, that he received £121,093 as a reward for his virtues and frugality; that Æsop, the tragedian, had a dish served up at his table which cost £4843; that Vitellius spent £7,265,625 in twelve months, in eating and drinking; and that Vespasian, at his accession to the empire, declared that an annual revenue of £322,916,666 would be necessary to keep the state machine in motion. It is astonishing that but few of our scholars or commentators seem to have been struck with the palpable extravagance of these and similar statements; though, to use the words of Garnier, they have brought “l’Histoire Ancienne, sous le rapport des valeurs, au même degré de vraisemblance que les contes de Mille et un Nuits.” It should be remembered that, from the greater poverty of the mines of the old world, and the comparatively small progress made in the art of mining, the value of gold and silver was much—probably four times—greater in antiquity than at present. But, without taking this circumstance into account, the computations referred to are too obviously absurd to deserve any attention. Vespasian would have been very well satisfied with a revenue of twenty millions; and there are good grounds for supposing that the Roman revenue, when at the highest, never amounted to so large a sum.

French Money.—From about the year 800, in the reign of Charlemagne, to the year 1103, in that of Philip I., the French livre, or money unit, contained exactly a pound weight or twelve ounces (poids de marc) of pure silver. It was divided into twenty sols, each, of course, weighing one-twentieth part of a pound. This ancient standard was first violated by Philip I., who diminished considerably the quantity of pure silver contained in the sols. The example, once set, was so well followed up, that in 1180 the livre was reduced to less than a fourth part of its original weight of pure silver. In almost every succeeding reign there was a fresh diminution. “La monnoye,” says Le Blanc, “qui est la plus précieuse et la plus importante de mésures, a changé en France presque aussi souvent que nos habits ont changé de mode.” And to such an extent had the process of degradation been carried, that, at the Revolution, the livre did not contain a seventy-eighth part of the silver contained in the livre of Charlemagne. It would then have required 7885 livres really to extinguish a debt of 100 livres contracted in the ninth or tenth centuries; and an individual who, in that remote period, had an annual income of 1000 livres, was as rich, in respect to money, as those who, at the Revolution, enjoyed a revenue of 78,850 livres.

We subjoin an abridged table calculated by M. Denis, exhibiting the average value of the French livre in different periods, from the year 800 to the Revolution:—

Those who wish for a detailed account of the various changes in the weight and purity of French coins, may, besides the excellent work of Le Blanc, consult the elaborate and very complete tables at page 905 of the “Traité des Mésures” of Paucton, and at page 197 of the “Essai sur les Monnoies” of Dupré de St. Maur.

It was not to be expected that degradations originating in the necessities, the ignorance, and the rapacity of a long series of arbitrary princes, should be made according to any fixed principle. They were sometimes the result of an increase in the denomination of the coins, but more frequently of a diminution of the purity of the metal of which they were struck. A degradation of this kind was not so easily detected; and, to render its discovery still more difficult, Philip of Valois, John, and some other kings, obliged the officers of the mint to swear to conceal the fraud, and to endeavour to make the merchants believe that the coins were of full value! Sometimes one species of money was reduced without any alteration being made in the others. No sooner, however, had the people, in their dealings, manifested a preference, as they uniformly did, for the money which had not been reduced, than its circulation was forbidden, or its value brought down to the same level with the rest. To render the subject more obscure, and the better to conceal their incessant frauds, individuals were at one time compelled to reckon exclusively by livres and sols, at other times by crowns or ecus; and not unfrequently they were obliged to refer, in computing, to coins which were neither livres, sols, nor crowns, but some multiple or fractional part thereof. The injurious effects of these constant fluctuations in the value of money are forcibly depicted by the French historians; and so insupportable did they become, that in the fourteenth and fifteenth centuries, several cities and provinces were glad to purchase the precarious and little respected privilege of having coins of a fixed standard, by submitting to the imposition of heavy taxes.

In Normandy, when it was governed by the English monarchs, there was a tax upon hearths, paid every three years, called monetagium, in return for which the sovereign engaged not to debase his coins. This tax was introduced into England by our early kings of the Norman race; but Henry I., in the first year of his reign, was induced to abandon it, and it has not since been revived.

According to the present regulations of the French mint, the coins contain 9/10ths pure metal, and 1-10th alloy. The franc, which is equal to 1 livre 0 sols 3 deniers, weighs exactly 5 grammes, or 77·2205 English Troy grains. The gold piece of 20 francs weighs 102·96 English grains.

English Money.—In England at the epoch of the Norman conquest, the silver, or money pound, weighed exactly twelve ounces Tower weight (11 oz. 5 dwt. Troy.) It was divided into twenty shillings, and each shilling into twelve pence, or sterlings. This system of coinage, which is in every respect the same with that established in France by Charlemagne, had been introduced into England previously to the invasion of William the Conqueror, and was continued, without any alteration, till the year 1300, in the 28th Edward I., when it was for the first time violated, and the value of the pound sterling degraded to the extent of 10/81 per cent. But the really pernicious effect of this degradation did not consist so much in the trifling extent to which it was carried by Edward, as in the example which it afforded to his less scrupulous successors, by whom the standard was gradually debased, until, in 1601, in the reign of Queen Elizabeth, 58s. instead of 20s. were coined out of the Tower pound weight of silver.

It may, perhaps, be right to mention, that in the 18th of Henry VIII. (1527), the pound Troy was substituted in mint valuations for the Tower pound, and has continued to be used in them down to the present time. This circumstance must always be kept in view in estimating the extent to which the standard has been degraded. When, for example, all tampering with it finally ceased in 1601, 62s. were coined out of a pound Troy. Hence, if we suppose, as is very often done, that the same pound had been used at the mint from the Conquest, it would follow that the degradation since the 28th Edward I. had been in the ratio of 20 to 62, or of 1 to 31th; whereas, in point of fact, it had really been in the ratio of 20 to 58, or of 1 to 29/10ths. Practically, it may be said that the standard of money was reduced two-thirds between 1300 (28th Edward I.) and 1601, and hence, it is obvious that the stipulations in all contracts, entered into in the reigns immediately subsequent to the Conquest, might, in 1601, and since, be legally discharged by the payment of about a third part of the sums really bargained for. And yet the standard has been less degraded in England than in any other country.

The tables annexed to this article give an ample account of these degradations, and also give the weight of the gold coins, and the proportional value of gold to silver, estimated both by the mint regulations, and by the quantity of fine gold and fine silver contained in the different coins.

Scotch Money.—The English derived their system of coinage from the French, and the Scotch theirs from the English. From 1296 to 1355, the coins of both divisions of the island were of the same weight and purity. But at the last mentioned period, it was attempted to fill up the void in the currency of Scotland, occasioned by the remittance of the ransom of David II. to England, by degrading the coins. Down to this period, the money of the two kingdoms had been current in both on the same footing; and the preservation of this equality is assigned by Edward III. as a reason for his degrading the English coin. The English princes did not, however, keep pace with the Scotch in the career of degradation. Such was the mischievous energy of the latter, that in 1390 Scotch coin passed only for half its nominal value in England; and, in 1393, it was ordered that its currency as money in the latter should cease, and that its value should henceforth depend on the weight of the genuine metal contained in it. “To close this point at once,” says Pinkerton, “the Scottish money, equal in value to the English till 1355, sunk by degrees, reign after reign, owing to succeeding public calamities, and the consequent impoverishment of the kingdom, till, in 1600, it was only a twelfth part of the value of English money of the same denomination, and remained at that point till the union of the kingdoms cancelled the Scottish coinage.”

The annexed tables exhibit the successive degradations of the Scotch silver and gold coins.

At the Union, in 1707, it was ordered that all the silver coins current in Scotland, foreign as well as domestic, except English coins of full weight, should be brought to the Bank of Scotland, to be taken to the mint to be recoined. In compliance with this order, there were brought in:—

Ruddiman conjectures, apparently with considerable probability, that the value of the gold and silver coins not brought in amounted to about as much more. Much suspicion was entertained of the recoinage. And that large proportion of the people who were hostile to the Union, and did not believe in its permanence, brought very little money to the Bank. A few only of the hoarded coins have been preserved, the far greater part having either been melted by the goldsmiths, or exported to other countries.

Irish Money.—The gold and silver coins of Ireland are identical with those of Great Britain. The rate, however, at which they used to circulate in the former, or their nominal value as money of account, was 81/3 per cent. higher than in the latter. This difference of valuation, though attended with considerable inconvenience, subsisted from 1689 till 1825, when it was put an end to. For an account of the various species of metallic money which have at different times been current in Ireland, we beg to refer our readers to Simon’s “Essay on Irish Coins;” a work pronounced by Ruding to be “the most valuable of all the publications on the coinage of any part of the united empire.”

Money of Germany, Spain, etc.—“In many parts of Germany, the florin, which is still the integer or money of account of those countries, was originally a gold coin, of the value of about 10s. of our present money (old coinage). It is now become a silver coin, of the value of only 20d.; and its present value, therefore, is only equal to a sixth part of what it was formerly. In Spain, the maravedi, which was in its origin a Moorish coin, and is still the money of account of that kingdom, was in ancient times most frequently made of gold. Le Blanc observes, that in 1220 the maravedi weighed 84 grains of gold, equal in value to about 14s. (old coinage) of our present money. But this maravedi, though its value is not quite the same in all the provinces of Spain, is now become a small copper coin, equal in general to only 43-272 of an English penny! In Portugal, the re, or reis, is become of no greater value than 27-401ths of an English penny; it is so small, that in estimating its value in other coins, it is reckoned by hundreds and thousands. The moeda, or moidore, is equal to 4800 reis; and this little coin has now, in fact, no existence but in name. Such has been the fate of all these coins, and such is the present state of their depreciation.”

The principle of degradation has not, however, been uniformly acted upon. The bullion contained in coins of the same denomination, has sometimes, though rarely, been increased, and creditors enriched at the expense of their debtors. This method of swindling is said to have been first practised in the worst times of the Roman empire. The citizens being bound to pay into the imperial treasury a certain number of pieces of gold, or aurei, Heliogabalus, whose cunning appears to have been nowise inferior to his proverbial profligacy, increased the weight of gold in the aureus; and thus obtained, by an underhand trick, an addition to his means of dissipation, which he might not have been able to obtain by a fair and open proceeding. In France, the value of the coins has been frequently raised. During the early part of the reign of Phillip le Bel, who ascended the throne in 1285, the value of the coin had been reduced to such an extent as to occasion the most violent complaints on the part of the clergy and landholders, and generally of all that portion of the public whose incomes were not increased proportionally to the reduction in the value of money. To appease this discontent, and in compliance with an injunction of the pope, the king consented to issue new coins of the same denomination with those previously current, but which contained about three times the quantity of silver. This, however, was merely shifting an oppressive burden from the shoulders of one class to those of another less able to bear it. The degraded money having been in circulation for about sixteen years, by far the largest proportion of the existing contracts must have been adjusted with reference to it. No wonder, therefore, that debtors should have felt indignant at the injustice done them by this enhancement of the value of money, and that they refused to make good their engagements otherwise than in money of the value of that which had been current when they were entered into. The labouring class, to whom every change in the value of money is injurious, having joined the debtors in their opposition, they broke out into open rebellion. “The people,” says Le Blanc, “being reduced to despair, and having no longer anything to care for, lost the respect due to the edict of his majesty; they pillaged the house of the master of the mint, who was believed to have been the chief adviser of the measure, besieged the Temple, in which the king lodged, and did all that an infuriated populace is capable of doing.” The sedition was ultimately suppressed. It is not mentioned whether any abatement were made, by authority, from the claims of the creditors, in the contracts entered into when the light money was in circulation. It seems probable, however, from what is elsewhere mentioned by Le Blanc, that such was really the case.

The history of the French coinage affords several instances similar to that now brought under the notice of the reader. But, in England, the new coinage in the last year of Edward VI. is the only instance in which the value of money has been augmented by the direct interference of government. Previously to the accession of Henry VIII., the pound of standard silver bullion, containing 11 oz. 2 dwts. of pure silver, and 13 dwts. of alloy, was coined into thirty-seven shillings and sixpence. Henry, however, not only increased the number of shillings coined out of a pound weight of silver, but also debased its purity. The degradation was increased under his son and successor, Edward VI., in the fifth year of whose reign seventy-two shillings were coined out of a pound weight of bullion; and as this bullion contained only three ounces of pure silver to nine ounces alloy twenty of these shillings were only equal to 4s. 73/4d of our present money, including the seignorage. It appears from the proclamations issued at the time, and from other authentic documents, that this excessive reduction of the value of silver money occasioned the greatest confusion. A maximum was set on the prices of corn and other necessaries, and letters were sent to the gentlemen of the different counties, desiring them to punish those who refused to carry their grain to market. But it was soon found to be quite impossible to remedy these disorders otherwise than by withdrawing the base money from circulation. This was accordingly resolved upon; and in 1552 new coins were issued of the old standard in respect of purity; and which, though less valuable than those in circulation during the early part of the reign of Henry VIII., were above four times the value of a large proportion of the coins of the same denomination that had been in circulation for some years before.

It is, however, all but certain that such a rise in the value of money could not have taken place without occasioning the most violent commotions, had all the coins previously in circulation been debased. Equal injustice, it must be remembered, is always done to the poorest and not least numerous class of society, by increasing the value of money, that is done to the wealthier classes by its depression. And, though government had been disposed to sanction so enormous an invasion of the right of property, it is altogether impossible that the country could have submitted to have had 400 or 450 per cent. added to its taxes and other public burdens by a legerdemain trick of this kind, or that individuals would have consented to pay so much more than they had originally bargained for. Instead of deserving praise for accomplishing such a measure, Edward VI., who began the reformation of the coins, and Elizabeth, by whom it was completed, would have justly forfeited the esteem of their subjects, and lost their popularity. In truth, however, little or no change had been made during all this period in the value of the gold coins; and there is, besides, abundance of evidence to show that many of the old silver coins had remained in circulation. And as there is no mention made of the issue of the new coins having been attended with any inconvenience, it is nearly certain, as Mr Harris has remarked, that, during the period of the debasement of the standard, individuals had regulated their contracts chiefly with reference to the gold or old silver coins; or, which is the same thing, that “they had endeavoured, as well as they could, to keep by the standard, as it had been fixed in the preceeding times.”

We have been thus particular in examining this measure, because it has been much referred to. It is plain, however, that it gives no support to the arguments of those who appeal to it as affording a striking proof of the benefits which they affirm must always result from restoring a debased or degraded currency to its original purity or weight. Invariability of value is the great desideratum in a currency. To elevate the standard, after it has been for a considerable period depressed, is not a measure of justice, but of new injustice. It vitiates and falsifies the provisions in one set of contracts, that those in another set may be properly adjusted.

This, however, as already remarked, is the only instance in which the government of England has interfered directly to enhance the value of money. In every other case, where they have tampered with the standard, it has been to lower its value, or, which comes to the same thing to reduce their own debts and those of their subjects.

It is unnecessary to enumerate in detail the various bad consequences of these successive changes in the standard of value. But it deserves to be remarked, that its reduction does not afford any real relief to the governments by whom so miserable a fraud is perpetrated. Their debts are, it is true, reduced, but so are their revenues. A coin that has been degraded will not exchange for, or buy, the same quantity of commodities that it previously did. If the degradation be 10 per cent., government, and every one else, will very soon be compelled to pay £110 for commodities or services which were previously obtainable for £100. Hence, to bring the same real value into the coffers of the treasury, it is necessary that taxation should be increased whenever the standard is diminished; a measure always odious, and sometimes impracticable.

A corresponding reduction of revenue is not, however, the only bad effect resulting to such governments as are dishonest enough to reduce the standard of money. They must not expect to borrow on the same favourable terms as those who act with good faith. The lenders of money to knaves always stipulate for a proportionally high rate of interest. They not only bargain for as much as may be got from secure investments, but also for an additional rate, or premium, to cover the risk of dealing with those who have given proofs of bad faith, and on whose promises no reliance can be placed. A degradation of the standard is, therefore, about the most wretched device to which a bankrupt government can have recourse. It will never, indeed, be resorted to except by those who are as ignorant as they are unprincipled. “It occasions,” says Dr. Smith, “a general and most pernicious subversion of the fortunes of private people; enriching, in most cases, the idle and profuse debtor at the expense of the frugal and industrious creditor, and transporting a great part of the national capital from the hands which were likely to increase and improve it, to those who are likely to dissipate and destroy it. When it becomes necessary for a state to declare itself bankrupt, in the same manner as when it becomes necessary for an individual to do so, a fair, open, and avowed bankruptcy is always the measure which is both least dishonourable to the debtor and least hurtful to the creditor. The honour of a state is surely very poorly provided for, when, in order to cover the disgrace of a real bankruptcy, it has recourse to a juggling trick of this kind, so easily seen through, and at the same time so extremely pernicious.”

Some of the bad consequences resulting from changes in the value of money might be obviated, by enacting that the stipulations in preceding contracts should be made good, not according to the present value of money, but according to its value at the time when they were entered into. This principle, which is conformable to the just maxim of the civil law (Valor monetœ considerandus atque inspiciendus est, a tempore contractus, non autem a tempore solutionis), was acted upon, to a certain extent, at least, by the kings of France during the middle ages. Ordinances of Philip le Bel, Philip of Valois, and Charles VI., issued subsequently to their having increased the value of money, or, as the French historians term it, returned from the “foible” to the “forte monnoie,” are still extant, in which it is ordered that all preceding debts and contracts should be settled by reference to the previous standard. But, though the same reason existed, it does not appear that any such ordinances were ever issued when the value of money was degraded. It is obvious, indeed, that a government would derive no advantage from reducing the value of money, were it to order, as it is in justice bound to do, that all preceding contracts should be adjusted by the old standard. Such a measure would reduce the revenue without reducing the national incumbrances; while, by establishing a new standard of value, and unsettling the notions of the public, it would open a door for many abuses, and be productive of infinite confusion and disorder in the dealings of individuals.

The odium, and positive disadvantage attending the degradation of metallic money, have at length induced most governments to abstain from it. But they have only renounced one mode of playing at fast and loose with the property of their subjects, to adopt another and a still more pernicious one. The injustice which was formerly done by diminishing the bullion contained in coins, is now perpetrated with greater ease, and to a still more ruinous extent, by the depreciation of paper currency.