Page:Inquiry into the Principles and Policy of the Government of the United States.djvu/393

Rh of specie, by an absolute monarch. Coin adulterated, or paper multiplied, buys less. Coin purified, or paper diminished, buys more. It would be dangerous for the strongest despotism to gather wealth, by causing gold to fluctuate, between twelve and twenty four carats, several times a year. If this despotism was a merchant, it could by such a power, buy and sell the commodities of its subjects at what gain it pleased. The carat of paper money, fluctuates with its quantity, and this fluctuation is at all times within the power of banking, and frequently produced. Being capable of greater repetition, it can enrich and impoverish, beyond any practicable alternate adulteration and purification of coin, for the benefit of a corporation or a despotism. Paper currency can be made better and worse more frequently by the magick of a bank, than specie by the furnace of a monarch; but although the banking adulterations can do so much more work, yet we do not believe it because we do not see the process, and only see the effect, in their amassing wealth with a rapidity and duration, far beyond adulterations of coin in any mode hitherto discovered. If a king of England should call in forty millions of specie, and pay it back in adulterated money, so as to rob the nation of twenty; that freeborn people would probably cut off his head; and the same wise-born people, are quite contented to be robbed of a larger sum annually, by the same principle.

To illustrate the facility with which this may be done with paper, in a stockjobbing way, better than with specie, in a despotick way (as a chymical process, in the moist and dry way, can produce the same result) let us suppose the managers of banking to be buyers of the staple of a country; wheat for instance. When the crop comes in, the price will be kept down, by appreciating or purifying paper currency, by lessening the quantity. Under this influence, those who work the furnace, buy. The loss, like adulterations of specie, falls upon ignorance and industry. It is a law of maximum, or for fixing prices, except that an interested party regulates them, instead of a government.