A LETTER ON MR. M'CULLA'S PROJECT ABOUT HALFPENCE, AND A NEW ONE PROPOSED.
Sir,
You desire to know my opinion concerning Mr. M'Culla's project, of circulating notes stamped on copper, that shall pass for the value of halfpence and pence. I have some knowledge of the man; and about a month ago he brought me his book, with a couple of his halfpenny notes: but I was then out of order, and he could not be admitted. Since that time I called at his house; where I discoursed, the whole affair with him as thoroughly as I could. I am altogether a stranger to his character. He talked to me in the usual style, with a great profession of zeal for the public good, which is the common cant of all projectors in their Bills, from a First Minister of State down to a corn-cutter. But I stopped him short, as I would have done a better man; because it is too gross a pretence to pass at any time, and especially in this age, where we all know one another so well. Yet, whoever proposeth any scheme which may prove to be a public benefit, I shall not quarrel if it prove likewise very beneficial to the contriver. It is certain, that next to the want of silver, our greatest distress in point of coin is the want of small change, which may be some poor relief for the defect of the former, since the Crown will not please to take that work upon them here as they do in England. One thing in Mr. M'Culla's book is certainly right, that no law hinders me from giving a payable note upon leather, wood, copper, brass, iron, or any other material (except gold and silver) as well as upon paper. The question is, whether I can sue him on a copper bond, when there is neither his hand nor seal, nor witnesses to prove it? To supply this, he hath proposed, that the materials upon which his note is written, shall be in some degree of value equal to the debt. But that is one principal matter to be enquired into. His scheme is this:
He gives you a piece of copper for a halfpenny or penny, stamped with a promissory note to pay you twentypence for every pound of the said copper notes, whenever you shall return them. Eight and forty of the halfpenny pieces are to weigh a pound, and he sells you that pound coined and stamped for two shillings: by which he clearly gains a little more than sixteen per cent.; that is to say, twopence in every shilling. This will certainly arise to a great sum, if he should circulate as large a quantity of his notes, as the kingdom, under the great dearth of silver, may very probably require: enough indeed to make any Irish tradesman's fortune; which, however, I should not repine at in the least, if we could be sure of his fair-dealing.
It was obvious for me to raise the common objection, why Mr. M'Culla would not give security to pay the whole sum to any man who returned him his copper notes, as my Lord Dartmouth and Colonel Moor were, by their patents, obliged to do.[113] To which he gave some answers plausible enough. First, "He conceived that his coins were much nearer to the intrinsic value than any of those coined by patents, the bulk and goodness of the metal fully equalling the best English halfpence made by the crown: That he apprehended the ill-will of envious and designing people, who, if they found him to have a great vent for his notes, since he wanted the protection of a patent, might make a run upon him, which he could not be able to support: And lastly, that his copper, (as is already said,) being equal in value and bulk to the English halfpence, he did not apprehend they should ever be returned, unless a combination, proceeding from spite and envy, might be formed against him."
But there are some points in his proposals which I cannot well answer for; nor do I know whether he would be able to do it himself. The first is, whether the copper he gives us will be as good as what the crown provided for the English halfpence and farthings; and, secondly, whether he will always continue to give us as good; and, thirdly, when he will think fit to stop his hand, and give us no more; for I should be as sorry to lie at the mercy of Mr. M'Culla, as of Mr. Wood.
There is another difficulty of the last importance. It is known enough that the Crown is supposed to be neither gainer nor loser by the coinage of any metal; for they subtract, or ought to subtract, no more from the intrinsic value than what will just pay all the charges of the mint; and how much that will amount to, is the question. By what I could gather from Mr. M'Culla, good copper is worth fourteenpence per pound. By this computation, if he sells his copper notes for two shillings the pound, and will pay twentypence back, then the expense of coinage for one pound of copper must be sixpence, which is thirty per cent. The world should be particularly satisfied on this article before he vends his notes; for the discount of thirty per cent. is prodigious, and vastly more than I can conceive it ought to be. For, if we add to that proportion the sixteen per cent. which he avows to keep for his own profit, there will be a discount of about forty-six per cent. Or, to reckon, I think, a fairer way: Whoever buys a pound of Mr. M'Culla's coin, at two shillings per pound, carries home only the real value of fourteenpence, which is a pound of copper; and thus he is a loser of 41l. 13s. 4d. per cent.[114] But, however, this high discount of thirty per cent. will be no objection against M'Culla's proposals; because, if the charge of coinage will honestly amount to so much, and we suppose his copper notes may be returned upon him, he will be the greater sufferer of the two; because the buyer can lose but fourpence in the pound, and M'Culla must lose sixpence, which was the charge of the coinage.[115]
Upon the whole, there are some points which must be settled to the general satisfaction, before we can safely take Mr. M'Culla's copper notes for value received; and how he will give that satisfaction, is not within my knowledge or conjecture. The first point is, that we shall be always sure of receiving good copper, equal in bulk and fineness to the best English halfpence.
The second point is, to know what allowance he makes to himself, either out of the weight or mixture of his copper, or both, for the charge of his coinage. As to the weight, the matter is easy by his own scheme; for, as I have said before, he proposes forty-eight to weigh a pound, which he gives you for two shillings, and receives it by the pound at twentypence: so that, supposing pure copper to be fourteenpence a pound, he makes you pay thirty per cent. for the labour of coining, as I have already observed, besides sixteen per cent. when he sells it. But if to this he adds any alloy, to debase the metal, although it be not above ten per cent.; then Mr. M'Culla's promissory notes will, as to the intrinsic value of the metal, be above forty-seven per cent. discount.
For, subtracting ten per cent. off sixty pound's worth of copper, it will (to avoid fractions) be about five and a half per cent. in the whole 100l., which, added to