Of Banks - Page 2

the beginning of January next after their settlement), since to this day, as I am informed, they have not lent one farthing in that manner.

Our banks are indeed nothing but so many goldsmiths' shops, where the credit being high (and the directors as high) people lodge their money; and they--the directors, I mean--make their advantage of it. If you lay it at demand, they allow you nothing; if at time, 3 per cent.; and so would any goldsmith in Lombard Street have done before. But the very banks themselves are so awkward in lending, so strict, so tedious, so inquisitive, and withal so public in their taking securities, that men who are anything tender won't go to them; and so the easiness of borrowing money, so much designed, is defeated. For here is a private interest to be made, though it be a public one; and, in short, it is only a great trade carried on for the private gain of a few concerned in the original stock; and though we are to hope for great things, because they have promised them, yet they are all future that we know of.

And yet all this while a bank might be very beneficial to this kingdom; and this might be so, if either their own ingenuity or public authority would oblige them to take the public good into equal concern with their private interest.

To explain what I mean; banks, being established by public authority, ought also, as all public things are, to be under limitations and restrictions from that authority; and those limitations being regulated with a proper regard to the ease of trade in general, and the improvement of the stock in particular, would make a bank a useful, profitable thing indeed.

First, a bank ought to be of a magnitude proportioned to the trade of the country it is in, which this bank is so far from that it is no more to the whole than the least goldsmith's cash in Lombard Street is to the bank, from whence it comes to pass that already more banks are contriving. And I question not but banks in London will ere long be as frequent as lotteries; the consequence of which, in all probability, will be the diminishing their reputation, or a civil war with one another. It is true, the Bank of England has a capital stock; but yet, was that stock wholly clear of the public concern of the Government, it is not above a fifth part of what would be necessary to manage the whole business of the town--which it ought, though not to do, at least to be able to do. And I suppose I may venture to say above one-half of the stock of the present bank is taken up in the affairs of the Exchequer.

I suppose nobody will take this discourse for an invective against the Bank of England. I believe it is a very good fund, a very useful one, and a very profitable one. It has been useful to the Government, and it is profitable to the proprietors; and the establishing it at such a juncture, when our enemies were making great boasts of our poverty and want of money, was a particular