The English commercial crisis, whose premonitory symptoms 
were long ago chronicled in our columns,’ is a fact now loudly 
proclaimed by the highest authorities in this matter—the annual 
circulars issued from the British Chambers of Commerce, and the 
leading commercial firms of the kingdom, along with extensive 
bankruptcies, mills running short-time, and stinted export tables, 
which speak to the same effect. According to the latest official 
“accounts relating to trade and navigation,” the declared value of 
enumerated articles of export in the month ending Dec. 5, was: 

1852 1853 1854 
£6,033,030 £7,628,760 £5,771,772 
Decrease iN 1854 .......cccceeccceeeeeeees £261,258 £1,856,988 

One cannot be astonished at the endeavor of the professional! 
free-traders of Great Britain to show that the present crisis, 
instead of flowing from the natural working of the modern 
English system, and being altogether akin to the crises experienced 
at periodical intervals almost since the end of the 18th century, 
must, on the contrary, proceed from accidental and exceptional 
circumstances. According to the tenets of their school, commercial 
crises were out of the question after the corn laws were 
abrogated,*” and free-trade principles adopted by the British 
legislature. Now they not only have high prices of corn with an 
abundant harvest, but also a commercial crisis. California and 
Australia added to the markets of the world and pouring forth 

* See present edition, Vol. 12, pp. 95-96, 249 and 304-05 and this volume, 
pp. 468-69.— Ed. 

their golden streams, with electric telegraphs transforming the © 
whole of Europe in one single Stock Exchange, and with railways 
and steamers centuplicating the means of communication and of 
exchange. If their panacea had to be put to the test, they could 
not have expected to do it under circumstances more favorable 
than those which signalize the period from 1849 to 1854 in the 
history of trade and commerce. 

They have failed to realize their promises, and naturally enough 
the war is now to be made the scapegoat of free-trade, just as the 
revolution in 1848 was. They cannot deny, however, that to a 
certain extent, the Oriental complication has delayed the revulsion, 
by acting as a check on the spirit of reckless enterprise, and 
turning part of the surplus capital to the loans recently contracted 
by most of the European powers; that some trades, like the iron 
trade, the leather trade and wool trade, have received some 
support from the extraordinary demand the war has created for 
these products; and, lastly, that in other trades, like the shipping, 
the woad trade, etc., where exaggerated notions as to the effects of 
the war fostered over-speculation on both sides of the Atlantic, 
only a partial outlet has been furnished to the already ruling and 
universal tendency to over-trading. However, their principal 
argument amounts to this, that the war has produced high prices 
for all sorts of grain, which high prices have engendered the crisis. 

Now, it will be recollected that the average prices of corn ruled 
higher in 1853 than in 1854. If, then, these high prices are not to 
account for the unprecedented prosperity of 1853, they can as 
little account for the revulsion of 1854. The year 1836 was marked 
by commercial revulsion, notwithstanding its low corn prices; 1824 
as well as 1853 were years of exceptional prosperity, notwithstand- 
ing the high prices that ruled in all sorts of provisions. The truth 
is, that although high corn prices may cripple industrial and 
commercial prosperity by contracting the home market, the home 
market m a country like Great Britain will never turn the balance, 
unless all foreign markets be already hopelessly overstocked. High 
corn prices must, therefore, in such a country, aggravate and 
prolong the revulsion; which, however, they are unable to create. 
Besides, it must not be forgotten that, conforming to the true 
doctrine of the Manchester School, high corn prices, if produced 
by the regular course of nature, instead of by the working of 
protection, prohibitive laws and sliding scales, altogether lose their 
fatal influence, and may even work advantageously by benefiting 
the farmers. As the two very deficient harvests of 1852 and 1853 
cannot be denied to have been natural events, the free-traders 

The Commercial Crisis in Britain _ 587 

turn around upon the year 1854, and affirm that the Oriental 
war, working like a protective duty, has produced high prices 
notwithstanding a plentiful harvest. Putting aside, then, the 
general influence of the prices of breadstuffs upon industry, the 
question arises as to the influence exerted by the present war 
upon these prices. 

The Russian importation of wheat and flour constitutes about 
19 per cent. of the entire importation of the United Kingdom, and 
its whole importations forming but about 20 per cent. of its 
aggregate consumption, Russia affords but little more than 2'/s 
per cent. of the whole. According to the latest official returns 
which do not extend over the first nine months of 1853, the entire 
imports of wheat into Great Britain were 3,770,921 qrs., of which 
773,507 were from Russia, and 209,000 from Wallachia and 
Moldavia. Of flour, the entire imports amounted to 3,800,746 
cwts., of which 64 were supplied from Russia, and none at all 
from the Principalities. Such was the case before the war broke 
out. During the corresponding months of 1854, the importation of 
wheat from Russian ports direct was 505,000 qrs., against 773,507 
in 1853, and from the Danubian Principalities 118,000 against 
209,000; being a deficiency of 359,507 qrs. If it be considered that 
the harvest of 1854 was a superior, and that of 1853 a very bad 
one, nobody will affirm that such a deficiency could have exerted 
any perceptible influence on prices. We see, on the contrary, fror 
the official returns of the weekly sales in the English market of 
home-grown wheat—these returns representing but a sinall 
portion of the entire sales of the country—that in the months of 
October and November, 1854, 1,109,148 qrs. were sold, agaitist 
758,061 qrs. in the corresponding months of 1853--more thes 
making up for the deficiency said to have been caused by the 
Russian war. We may remark, also, that had the English Cabinei 
not caused large stores of Turkish wheat to rot in the granaries of 
the Principalities by stupidly or treacherously blockading the 
Sulina, mouth of the Danube, and thus cutting off their own 
supplies, the war with Russia would not have stinted the 
importation of wheat even to the small amount it has done. Nearly 
two-thirds of the London imports of foreign flour being derived 
from the United States, it must be admitted that the failure of the 
American supply in the last quarter of 1854 was a much more 
important event for the provision trade than the Russian war." 

If we are asked how to explain the high prices of corn in Great 
Britain in the face of an abundant harvest, we shall state that more 
than once during the course of 1853, the fact was pointed at in 

The Tribune,’ that the free-trade delusions had caused the greatest 
possible irregularities and errors to take place in the operations of 
the British corn-trade, by depressing prices in the summer months 
below their natural level, when their advance alone should have 
secured the necessary supplies and sufficient orders for future 
purchases. Thus it happened that the imports in the months of 
July, August, September and October, 1854, reached but 750,000 
qrs. against 2,132,000 qrs. in the corresponding months of 1853. 
Besides, it can hardly be doubted that consequent upon the repeal 
of the corn laws such large tracts of arable land were transformed 
into pasture in Britain, as to make even an abundant harvest, 
under the new regime, relatively defective. 

? 

“Consequently,” to quote a circular of the Hull Chamber of Commerce, “tne 
United Kingdom commences the year 1855 with very small stocks of foreign wheat, 
and with prices almost as high as in the beginning of 1854, while depending almost 
entirely on its own farmers’ supplies until spring.” 

The reason of the English commercial revulsion of 1854, which 
is not likely to assume its true dimensions before the spring of the 
present year, is contained in the following few arithmetical 
characters: The exports of British produce and manufactures 
. having amounted, in 1846, to £57,786,000, reached, in 1853, the 
enormous value of £98,000,000. Of those £98,000,000 of 1853, 
Australia, which, in 1842, had taken off less than one million, and 
in 1850, about three millions, absorbed near fifteen millions; while 
the United States, which, in 1842, had only consumed £3,582,000, 
and, in 1850, somewhat less than £15,000,000, now took the 
enormous amount of £24,000,000. The necessary reaction upon 
the English trade of the American crisis, and the hopelessly 
glutted Australian markets, need no further explanation. In 1837 
the American crisis followed at the heels of the English crisis of 
1836, while now the English crisis follows in the tracks of the 
American one; but, in both instances, the crisis may be traced to 
the same source—the fatal working of the English industrial 
system which leads to over-production in Great Britain, and to 
over-speculation in all other countries. The Australian and the 
United States markets, so far from forming exceptions, are only 
the highest expressions of the general condition of the markets of 
the world, both being about equally dependent upon England. 

“We have the facts staring us in the face of glutted foreign markets and 

unprofitable returns, with few exceptions,” exclaims a Manchester circular, relating 
to the cotton trade. “Most of the foreign markets,” says another circular, relating 

." See present edition, Vol. 12. pp. 306-07, 326 and 440.— Ed. 

The Commercial Crisis in Britain 589 

to the silk trade, “usual vents for our surplus manufactures, have been groaning 

” 

under the effects of overtrading.” “Production was enormously increased,” we are 
told by an account of the Bradford Worsted trade, “and the goods, for a time, 
found an outlet in foreign markets. Much irregular business has been done in 
reckless consignments of goods abroad, and we need scarcely remark that the 
results generally have been of the most unsatisfactory character.” * 

And so we might quote from a score of leading commercial 
circulars that reached us by the Pacific.*° 

The Spanish Revolution and the consequent activity of smuggl- 
ing in that quarter, has created an exceptional market for British 
produce. The Levant market, consequent upon the apprehensions 
arising from the Oriental war, seems to be the only one which had 
not been overdone, but some three months since, as we learn, 
Lancashire set about retrieving what had been neglected in that 
quarter, and at this very moment we are told that Constantinople 
is also groaning under the overwhelming masses of cottons, 
woolens, hardware, cutlery, and all sorts of British merchandise. 
China is the only country where it can be pretended that political 
events have exerted a perceptible influence on the development of 
the commercial revulsion. 

“The hopes entertained about the gradual increase in our export trade with 
China,” says a Manchester house, “have been almost entirely dispelled, and the 
rebellion spreading at present, in that country, at first considered as favorable to 
foreign intercourse, seems now to be organized for the depredation of the country 
and the total ruin of trade. The export trade with China, which once was expected 

Our readers will perhaps remember that when the Chinese 
revolution ”° first assumed anything like serious dimensions, we 
predicted the disastrous consequences* now complained of by the 
English exporting houses. 

While denying all connection between the war and_ the 
commercial crisis, the symptoms of which had become apparent 
before the war was ever thought of, we are of course aware that 
the latter may dangerously aggravate the severe ordeal Great 
Britain will now have to pass through. The continuance of the war 
is tantamount to an increase of taxation, and increased taxes are 
certainly no cure for diminished incomes. | 

Written on January 1], 1855 Reproduced from the newspaper 

Tribune, No. 4294, January 26, 1855 asa 
leader