School, which had been previously established and was intended for the sons of mechanics.

inestimable moral, social, and economical blessings through the land, canals, rail-roads, and steam-boats, are to be constructed at vast expense. To effect these objects, capital must go forth like a mighty genius, bidding the mountains to bow their heads, and the valleys to rise, the crooked places to be straight, and the rough places plain. If agriculture is to be perfected, costly experiments in husbandry must be instituted by those who are able to advance, and can afford to lose, the funds which are required for the purpose. Commerce, on a large scale, cannot flourish without resources adequate to the construction of large vessels, and their outfit for long voyages, and the exchange of valuable cargoes. The eyes of the civilised world are intently fixed upon the experiments now making to navigate the Atlantic by steam. It is said that the Great Western was built and fitted out at an expense of near half a million of dollars. The success of the experiment will

The structure itself is of immense size, consisting of two wings and a centre building. In these there is a beautiful theatre for public lectures, which will accommodate upwards of 1500 auditors; a sculpture-gallery, containing several valuable statues; a museum, a reading-room, and library containing 6000 vols., of which, on an average, 200 are given out daily. The number and extent of the other rooms will be best understood by an account of the classes which occupy them. The Lower Day School, which in 1827 contained 80 pupils-in 1838, 221 pupils, and three masters-in 1839, 449 pupils and 10 masters-contains at present 470 pupils under the care of 12 masters. The terms for sons of members are 11. 15s. per annum, for others 27. 5s. Excepting classics, there are taught in this school all the branches of a good English education; comprising reading in elementary science, history &c., geo-be not more a triumph of genius and of art than of capital. The graphy and the use of the globes, grammar, composition &c., writing plain and ornamental, arithmetic, algebra, geometry, trigonometry &c., drawing, French, and natural philosophy.

The High School contains 356 pupils, under the care of 18 masters; terms, 10 guineas per annum. The course of instruction given in this school is intended to fit the pupils either for the college or counting-house. The evening classes, conducted by 26 masters, contain about 650 pupils, to whom instruction is afforded in English grammar, composition, geography, history, writing, arithmetic, the various branches of pure mathematics, navigation, nautical and popular astronomy, mechanical science and its application to the arts, mechanical drawing, architectural drawing, landscape-drawing and practical perspective, ornamental figure drawing and modelling, naval architecture, painting, natural philosophy, the French and German languages, classics, rhetorical delivery, and vocal music. In addition to these, there are public lectures twice a week, the audiences varying in number from 800 to 1000. The number of members at present belonging to the institution is as follows:

A contribution of ten guineas constitutes a life member; one guinea per annum, an annual member. A lady's subscription is half-a-guinea per annum.

The whole number of pupils in both the day and evening schools is by the last report 1476.

The effects of such an institution as this, must necessarily be a wide diffusion of useful knowledge among a class of men whose education has hitherto been much neglected. But there is another effect which ought not to be overlooked :-at the time when the institution was first established, many viewed it with great jealousy. Such a change of opinion, however, has now taken place, that those who stood aloof are now about to establish a similar institution. Private schools have also received a new incitement to exertion, and another Mechanics' Institution has already been founded at the north end of the town: in this there are evening schools and public lectures twice a week. This state of public feeling speaks well for the cause of education in Liverpool.

PROPERTY, CAPITAL, AND CREDIT.

NO. II.-CAPITAL AND CREDIT.

BY EDWARD EVERETT.

first attempts at the whale-fishery, in Massachusetts, were made from the South Shore and the island of Nantucket, by persons who went out in small boats, killed their whale, and returned the same day. This limited plan of operations was suitable for the small demands of the infant population of New England. But the whales were soon driven from the coast; the population increased, and the demand for the product of the fisheries proportionably augmented. It became necessary to apply larger capitals to the business. Whale ships were now fitted out at considerable expense, which pursued this adventurous occupation from Greenland to Brazil. The enterprise thus manifested awoke the admiration of Europe, and is immortalised in the well-known description by Burke. But the business has grown, until the ancient fishing grounds have become the first stations on a modern whaling voyage; and capitals are now required sufficient to fit out a vessel for an absence of forty months, and a voyage of circumnavigation. Fifty thousand dollars are invested in a single vessel; she doubles Cape Horn, ranges from New South Shetland to the coasts of Japan, cruises in unexplored latitudes, stops for refreshment at islands before undiscovered, and on the basis, perhaps, of the capital of an individual house, in New Bedford or Nantucket, performs an exploit which, sixty or seventy years ago, was thought a great object to be effected by the resources of the British government. In this branch of business a capital of twelve or fifteen million of dollars is invested. Its object is to furnish a cheap and commodious light for our winter evenings. The capitalist, it is true, desires an adequate interest on his investment; but he can only get this by selling his oil at a price at which the public are able and willing to buy it. The 'overgrown capitalist,' employed in this business, is an overgrown lamplighter. Before he can pocket his six per cent., he has trimmed the lamp of the cottager, who borrows an hour from evening to complete her day's labour, and has lighted the taper of the pale and thoughtworn student, who is 'outwatching the bear,' over some ancient volume.

"In like manner the other great investments of capital-whatever selfish objects their proprietors may have-must, before that object can be attained, have been the means of supplying the demand of the people for some great article of necessity, convenience, or indulgence. This remark applies peculiarly to manufactures carried on by machinery. A great capital is invested in this form, though mostly in small amounts. Its owners, no doubt, seek a profitable return; but this they can attain in no other way than by furnishing the community with a manufactured article of great and extensive use. Strike out of being the capital invested in manufactures, and you lay upon society the burden of doing by hand all the work which was done by steam and water, by fire and steel; or it must forego the use of the articles manufactured. Each result would in some measure be produced. A much smaller quantity of manufactured articles would be consumed, that is, the community would be deprived of comforts they now enjoy; and those used would be produced at greater cost by manual labour. In other words, fewer people would be sustained, and those less comfortably and at greater expense. When we bear persons condemning accumulations of capital employed in manufac rational man can desire to stop those busy wheels,-to paraly se those iron arms,-to arrest that falling stream which works while it babbles? What is your object? Do you wish wholly to deprive society of the fruit of the industry of these inanimate but untiring labourers? Or do you wish to lay on aching human shoulders the burdens which are so lightly borne by these patient metallic giants? Look at Lowell. Behold the palaces of her industry side by side with her churches and her school-houses;

"A MOMENT'S consideration will show the unreasonableness of a prejudice against capital, for it will show that it is the great instrument of the business movements of society. Without it, there can be no exercise, on a large scale, of the mechanic arts, no manufactures, no private improvements, no public enterprises of utility, no domestic exchanges, no foreign commerce. For all these purposes, a twofold use of capital is needed. It is necessary that a great many persons should have a portion of capital: as, for instance that the fisherman should have his boat; the husband-tures, we cannot help saying to ourselves, Is it possible that any man his farm, his buildings, his implements of husbandry, and his cattle; the mechanic, his shop and his tools; the merchant, his stock in trade. But these small masses of capital are not alone sufficient for the highest degree of prosperity. Larger accumulations are wanted to keep the smaller capitals in steady movement, and to circulate their products. If manufactures are to flourish, a very great outlay in buildings, fixtures, machinery, and power, is necessary. If internal intercourse is to diffuse its

the long lines of her shops and warehouses, her streets filled with the comfortable abodes of an enterprising, industrious, and intelligent population. See her fiery Sampsons roaring along her railroad with thirty laden cars in their train. Look at her watery Goliahs, not wielding a weaver's beam, like him of old, but giving motion to hundreds and thousands of spindles and looms. Twenty years ago, and two or three poor farms occupied the entire space within the boundaries of Lowell. Not more visibly, I had almost said not more rapidly, was the palace of Aladdin, in the Arabian tales, constructed by the genius of the lamp, than this noble city of the arts has been built by the genius of capital. This capital, it is true, seeks a moderate interest on the investment; but it is by furnishing to all who desire it the cheapest garment ever worn by civilised man. To denounce the capital which has been the agent of this wonderful and beneficent creation, to wage war with a system which has spread, and is spreading, plenty throughout the country-what is it but to play in real life the part of the malignant sorcerer in the same eastern tale, who, potent only for mischief, utters the baleful spell which breaks the charm, heaves the mighty pillars of the palace from their foundation, converts the fruitful gardens back to their native sterility, and heaps the abodes of life and happiness with silent and desolate ruins ?

more against the former,-namely, joint-stock companies,-than against large individual capitals. This, however, appears to be the fact. Some attempts have been made to organise public sentiment against associated wealth, as it has been called, without reflecting, as it would seem, that these associations are the only means by which persons of moderate property are enabled to share the profits of large investments. Were it not for these associations in this country, no pursuit could be carried on, except those within the reach of individual resources; and none but very rich persons would be able to follow those branches of industry which now diffuse their benefits among persons of moderate fortune. In which part of this alternative a conformity with the genius of our political institutions exists, need not be laboured.

46

But whether the masses of capital necessary to carry on the great operations of trade are derived from the association of several, or from the exclusive resources of one, it is plain that the interest of the capital, however formed, is identical with that of the community. Nobody hoards,—everything is invested or employed, and directly or indirectly, is the basis of business operations.

"It is true, that when one man uses the capital of another, he is expected to pay something for this privilege. But there is nothing unjust or unreasonable in this. It is inherent in the idea of property. It would not be property if I could not take it from you and use it as my own without compensation. That simple word, It is mine, carries with it the whole theory of property and its rights. If my neighbour has saved his earnings and built him a house with it, and I ask his leave to go and live in it, I ought in justice to pay him for the use of his house. If, instead of using his money to build a house in which he permits me to live, he lends me his money, with which I build a house for myself, it is equally just that I should pay him for the use of his money. It is his, not mine. If he allows me to use the fruit of his labour or skill, I ought to pay him for that use as I should pay him if he came and wrought for me with his hands. This is the whole doctrine of interest. In a prosperous community, capital can be made to produce a greater return than the rate of interest fixed by law. The merchant who employs the whole of his capital in his own enterprises, and takes all the profit to himself, is commonly regarded as a useful citizen; it would seem unreasonable to look with a prejudiced eye upon the capitalists who allow all the profits of the business to accrue to others, asking only legal interest for his money which they have employed.

"It is hardly possible to realise the effects on human comfort of the application of capital to the arts of life. We can fully do this, only by making some inquiry into the mode of living in civilised countries in the middle ages. The following brief notices, from Mr. Hallam's learned and judicious work, may give us some distinct ideas on the subject. Up to the time of Queen Elizabeth in England, the houses of the farmers in that country consisted of but one story and one room. They had no chimneys. The fire was kindled on a hearth of clay in the centre, and the smoke found its way out through an aperture in the room, at the door, and the openings at the side for air and light. The domestic animals, even oxen, were received under the same roof with their owners. Glass windows were unknown, except in a few lordly mansions, and in them they were regarded as moveable furniture. When the Dukes of Northumberland left Alnwick castle to come to London for the winter, the few glass windows which formed one of the luxuries of the castle were carefully taken out and laid away, perhaps carried to London to adorn the city residence. The walls of good houses were neither wainscoted nor plastered. In the houses of the nobility the nakedness of the walls was covered by hangings of coarse cloth. Beds were a rare luxury. A very wealthy individual had one or two in his house: rugs and skins laid upon the floor were the substitute. Neither books nor pictures formed any part of the furniture of a dwelling in the middle ages; as printing and engraving were wholly unknown, and painting but little practised. A few inventories of furniture, dating froin the fifteenth century, are preserved. They afford a striking evidence of the want of comfort and accommodation in articles counted by us among the necessaries of life. In the schedule of the furniture of a Signor Contarini, a rich Venetian merchant living in London in 1481, no chairs nor lookingglasses are named. Carpets were unknown at the same period their place was supplied by straw and rushes, even in the presence chamber of the sovereign. Skipton Castle, the principal residence of the Earls of Cumberland, was deemed amply provided in having eight beds, but had neither chairs, glasses, nor carpets. The silver plate of Mr. Fermor, a wealthy country gentleman at Easton, in the sixteenth century, consisted of sixteen spoons, and a few goblets and ale-pots. Some valuations of stock-in-which for a time he trades; but he has to pay back the borrowed rade in England, from the beginning of the fourteenth century, have been preserved. A carpenter's consisted of five tools, the vhole valued at a shilling; a tanner's, on the other hand, amounted o near ten pounds, ten times greater than any other, tanners being at that period the principal tradesmen, as almost all articles of dress for men were made of leather. "We need but contrast the state of things in our own time with hat which is indicated in these facts, to perceive the all-important fluence on human comfort of the accumulation of capital, and its mployment in the useful arts of life. As it is out of the question or the government to invest the public funds in the branches of ndustry necessary to supply the customary wants of men, it follows hat this must be done by private resources and enterprise. The ecessary consequence is, that the large capital required for ese operations must be furnished by the contributions of indiiduals, each possessing a portion of the stock, or by a single roprietor.

:

"I have left myself scarce room to speak on the subject of credit. The legitimate province of credit is to facilitate and to diffuse the use of capital, and not to create it. I make this remark with care, because views prevail on this subject exaggerated and even false; which, carried into the banking system, have done infinite mischief. I have no wish whatever to depreciate the importance of credit. It has done wonders for this country. It has promoted public and private prosperity; built cities, cleared wildernesses, and bound the remotest parts of the continent together with chains of iron and gold. These are wonders, but not miracles; these effects have been produced not without causes. Trust and confidence are not gold and silver; they command capital, but they do not create it. A merchant in active business has a capital of twenty thousand dollars; his credit is good; he borrows as much more; but let him not think he has doubled his capital. He has done so only in a very limited sense. He doubles the sum on capital with interest: and that, whether his business has been prosperous or adverse. Still, I am not disposed to deny that, with extreme prudence and good management, the benefit to the individual of such an application of credit is great; and when individuals are benefited, the public is benefited. But no capital has been created. Nothing has been added to the pre-existing stock. It was in being-the fruit of former accumulation. If he had not borrowed it, it might have been used by its owner in some other way. What the public gains, is the superior activity that is given to business by bringing more persons, with a greater amount and variety of talent, into action.

"These benefits, public and private, are not without some counterbalancing risks: and with the enterprising habits and ardent temperament of our countrymen, I should deem the formation of sound and sober views on the subject of credit one of the most desirable portions of the young merchant's education. The eagerness to accumulate wealth by trading on credit, is the disease of the age and country in which we live. Something of the solidity of our character and purity of our name has been sacrificed to it.

1840.]

THE LONDON SATURDAY JOURNAL.

OUR LITERARY LETTER-BOX.

HUMANITAS gives us the following statement:-A youth, respecting whom he writes, was, at the early age of eighteen weeks, by "a paralytic stroke, deprived of the use of his lower limbs, and consequently disabled from walking. He is now about twenty-three years of age, and has not recovered the strength of those useful members, and cannot walk any, not even with the aid of crutches. Providence, however, has amply compensated him by bestowing These he has dilithe rare and invaluable gift of great intellectual powers. gently cultivated, and has increased both in knowledge and piety. His natural talent, combined with that high degree of improvement (to which his solitary state must be very favourable), has rendered him a young man of great capability, remarkable for his unblemished character, and for his untiring exertion, even at his present age, for the public good. In the year 1826, being not then twenty years of age, he wrote and published a pamphlet, called 'ExposIt was reviewed and recommended by the tulations with the Profane.' 'Watchman' newspaper; and notwithstanding the remoteness of his present situation (residing in a village in the county of Radnor, as a schoolmaster, and the tract being published by a country bookseller), it has had a rapid sale. In 1837, he addressed a powerful and well-written letter to the Inhabitants of the County of Radnor, on the present low State of Learning in the County;' and has now a work in the press, called An Essay on the Nature and Importance of Legal Oaths, and on the awful Consequences of Perjury and of His object in this is, as his preface states, to promote Profane Swearing.' among men the love of truth and faithfulness, of fidelity and piety.' "Now, the question I have to ask you is-Is there nothing, or can there be nothing, constructed, by which he may be able to move himself along a street, Being the eldest of a large family, he has not as about an office, or the like? yet ever felt the want of an attendant, as he has brothers who, one or the other, carry him. Now, Mr. Editor, as his arms and body are strong, could not-believe me, I ask you with all modesty-could not there be something of this kind made, on the principle of the lever and wheel?"

Mr. KIRK, the gentleman who originally called our attention to the good or evil of NOVEL-READING, has written to us-and so have several other correspondents-relative to the interesting letter of J. P. (which was from Glasgow) in No. 64. Our correspondents and ourselves would come nearer in agreement than perhaps they think; but we are unwilling to open up the matter again, as we might be drawn into controversy.

G. W.-The FUNDS, as they are called, are not funds-that is, they are not money. The money which constituted the National Debt is all spent and gone; the Funds are nothing but the acknowledgments of the Government of this country that it is indebted so much money, and the holders, or persons in whose name the debt stands, are thereby entitled to receive so much money In consequence, however, of the national creditors annually, as interest. having free permission to transfer their claims, the National Debt has become a sort of paper property, which is daily bought and sold. If I have a certain amount of money invested in the Funds-that is, if the Government acknowledges that it owes me so much money, for which I am paid, through the agency of the Bank of England, a certain amount of annual interest-and I am anxious to get the use of my principal, I can transfer my claim on the Government to And as the interest is always any individual who may be willing to take it. sure, and the convenience of being able to "sell out" very great, people who have money which they wish to invest for a period, prefer, generally, investing it in the Funds, as they can recover their principal again with an ease which might not be the case with investments in other descriptions of property. The national creditor cannot demand his principal back from Government; it is only bound to pay the annual interest: therefore, the facility of transferring stock is not only a great convenience, but is made a great monied instrument.

Any person may transfer his own stock to any purchaser whom he may choose to sell it to; but the practice has grown up of leaving the business in The chief the hands of stock-brokers, who constitute an influential class. stock-brokers form a sort of self-elected corporation, with a building where they hold their meetings, called the Stock Exchange, a few steps from the Bank of England: such brokers and jobbers as have not been able to gain admission into the Stock Exchange constitute a kind of "light infantry," hanging about it, the individuals of which are more or less individually respectable.

The National Debt having been borrowed at different times, at different rates of interest, and on varying conditions, the "Funds," or national obligations, are divided into different classes, bearing different names, the chief of which are the "Consols.," a contraction for consolidated, (several classes

having been consolidated to form it,) or otherwise the Three per Cents. Added to the Government Funds are an immense variety of other paper securities shares in foreign loans, in companies, mines, canals and railroads, &c. &c., which constitute the stuff bought and sold in the MONEY-MARKET; and the respective values of which rise and fall on much the same principle that the value of corn, fish, or potatoes, rises or falls-though, of course, the action, or machinery, of the money-market is somewhat more artificial, complicated, and delicate, than that of any ordinary market.

There is a vast amount of "jobbing" in the Funds, practised not only by the irregulars, but by the regular members of the Stock Exchange, which, under the pretence of buying and selling, is a species of gambling on a large extent. One party offers to buy, and another to sell, at a certain price on a certain day. Instead, however, of actual sales, or transfers, taking place, the losing party pays to the winner the difference between the price at which the bargain or bet was made, and the price which the particular stock, or fund, is selling at when the settling arrives. Defaulters, unable to settle their bets, are called Lame Ducks; parties whose purchases or bargains make it their interest that the prices should rise, are called Bulls, because they are supposed to be likely to resort to any artifice that may cause the prices to be tossed up ; while parties whose interest it is that the prices should fail are called Bears, on the opposite idea of trampling down.

Thrice has a Mr. E. D. WYNNE written to us-" thrice the brinded cat has Therefore writes he, in mournful mewed"-and we have not answered him! strain, "I am a lover of the Penny Post, for I scribble away a deal of paper, and pay a many pennies, but I get no answers, not even from the London Saturday Journal." This is sad-but why did he not try us with something Mr. Wynne wished us to tell him else than one single solitary question? which of the metropolitan suburban villages were the most healthy; and though the question was rather broad, we put ourselves a little out of the way to try and get the materials for an answer to him. We have not succeeded; and can only tell him, that Islington is pleasant, but is becoming already an integral portion of London; that Highgate is high and healthy, but too cold in the spring months for invalids; that Hampstead is also a very pleasant district; Stoke Newington likewise; and Hackney, an ancient but not-to-be-despised parish. Of the villages on the Surrey side of the Thames we can say nothing, though the road all the way out to Norwood is exceedingly pleasant.

While we are thus gratifying one individual, we may here mention that we have not a few correspondents who have had greater reason to complain than Mr. Wynne. Several very intelligent correspondents have suggested topics for consideration, or questions, well worthy of attention, which, not being able to attend to at the time, have been gradually forgotten; and many others, who answer. Let such of our correspondents as think have written in an intelligent manner on matters chiefly personal to themselves, have received no themselves unworthily neglected refresh our memory-it costs them only a penny; and we will have no hesitation to answer privately any considerate correspondent who gives us his address, and whose letter may seem to require it.

S. Z. says, "In Mrs. H. More's work on the Education of a Princess, there is a suggestion which I think might be of a very useful cast. I allude to a passage in the early part of the chapter on Books, in which the authoress proposes that associations should be formed for the purpose of conversation on various subjects (of whicl. several good samples are there offered), without the formality of debate. I know not whether there be any such societies; and if there are, Will it be within your plan to they ought to be rather limited as to numbers. suggest to your readers the formation, in their respective circles, of such associations?"