Chats on Old Silver

by Arthur Hayden

Locke and Newton brought their minds to bear on the subtleties of the question, and adopted the ideas of Dudley North, who died in 1693. His tract on the restoration of the currency is practically the same as that subsequently adopted.

William Lowndes, Secretary of the Treasury, Member of Parliament for the borough of Seaford, “a most respectable and industrious public servant,” as Lord Macaulay terms him, was incapable of rising above the details of his office in order to cope with economic principles. “He was not in the least aware that a piece of metal with the King’s head on it was a commodity of which the price was governed by the same laws which govern the price of metal fashioned into a spoon or a buckle, and that it was no more in the power of Parliament to make the kingdom richer by calling a crown a pound than to make the kingdom larger by calling a furlong a mile. He seriously believed, incredible as it may seem, that if the ounce of silver were divided into seven shillings instead of five, foreign nations would sell us their wines and their silks for a smaller number of ounces.”

Happily Lowndes was completely refuted by Locke in his Further Considerations Concerning the Raising the Value of Money, 1695.

Locke recommended what Dudley North had advised, namely, that the King should issue a proclamation declaring hammered money should pass only by weight. What searching, branding, fining, burning, and hanging had failed to do would have been accomplished at once. The clipping of the hammered coin and the melting of the new milled coin to be made into silver plate would have ceased. But it had one objection. The loss would fall on the individual. Those in whose hands the clipped coin happened to be at a particular moment would bear the loss. But the loss in equity should be borne by the State which had allowed such evils to go unchecked.

It was suggested to remedy this that all clipped coin after a certain date would be exchanged for good coin at the mint. But it was soon realized that this would make clipping more profitable than ever.

A real remedy was devised but unhappily it fell through. A proclamation was to be prepared with great secrecy, and published simultaneously in all parts of the kingdom. This was to declare hammered coin should thenceforth only pass by weight. Every possessor of such coin could within three days deliver it in a sealed packet to the local authorities to be weighed and would receive a promissory note to receive from the Treasury the difference between the actual quantity of silver the pieces contained and the quantity they should have contained.

Anxious days followed in Parliament, but it was determined the public should bear the loss on the clipped coins. It was laid down that a time should be fixed when no clipped money should pass, except in payments to the Government, and that a later time should be fixed after which no clipped money should pass at all. The 4th of May, 1696, was named as the date on which the Government would cease to receive clipped money in payment of taxes.

Ten furnaces were erected in a garden behind the Treasury, which was then a part of Whitehall, and which lay between the Banqueting House and the river. Every day huge heaps of clipped and unrecognizable coins were here turned into ingots of silver and were sent off to the Mint at the Tower (L’Hermitage, January 14-24, 1696).

The scene may readily be imagined. The second of May 1696 had been fixed by Parliament as the last day in which the crowns, half-crowns, and shillings were to be received in payment of taxes for face value. The guards had to be called in to keep order. The Exchequer was besieged by a vast multitude from dawn to midnight. The Act provided that the money was to be brought in by before the 4th of May. The 3rd was a Sunday, therefore Saturday, the 2nd of May, was actually the last day.

During the next few months, as the issues of the new coinage were unduly slow, the tension was very great. The upper classes lived on credit. “Money exceeding scarce, so that none was paid or received: but all was on trust” (Evelyn’s Diary, May 13th). “Want of current money for smallest concerns even for daily provisions in the markets.” (June 11th, Evelyn’s Diary.)