If we refer to history, and examine what in fact has been the conduct of the Bank directors, we find that they have acted exactly as persons of their type, character, and position might have been expected to act.  They are a board of plain, sensible, prosperous English merchants; and they have both done and left undone what such a board might have been expected to do and not to do.  Nobody could expect great attainments in economical science from such a board; laborious study is for the most part foreign to the habits of English merchants.  Nor could we expect original views on banking, for banking is a special trade, and English merchants, as a body, have had no experience in it.  A ‘board’ can scarcely ever make improvements, for the policy of a board is determined by the opinions of the most numerous class of its membersits average membersand these are never prepared for sudden improvements.  A board of upright and sensible merchants will always act according to what it considers ‘safe’ principles—­that is, according to the received maxims of the mercantile world then and thereand in this manner the directors of the Bank of England have acted nearly uniformly.  Their strength and their weakness were curiously exemplified at the time when they had the most power.  After the suspension of cash payments in 1797, the directors of the Bank of England could issue what notes they liked.  There was no check; these notes could not come back upon the Bank for payment; there was a great temptation to extravagant issue, and no present penalty upon it.  But the directors of the Bank withstood the temptation; they did not issue their inconvertible notes extravagantly.  And the proof is, that for more than ten years after the suspension of cash payments the Bank paper was undepreciated, and circulated at no discount in comparison with gold.  Though the Bank directors of that day at last fell into errors, yet on the whole they acted with singular judgment and moderation.  But when, in 1810, they came to be examined as to their reasons, they gave answers that have become almost classical by their nonsense.  Mr. Pearse, the Governor of the Bank, said:  ’In considering this subject, with reference to the manner in which bank-notes are issued, resulting from the applications made for discounts to supply the necessary want of bank-notes, by which their issue in amount is so controlled that it can never amount to an excess, I cannot see how the amount of bank-notes issued can operate upon the price of bullion, or the state of the exchanges; and therefore I am individually of opinion that the price of bullion, or the state of the exchanges, can never be a reason for lessening the amount of banknotes to be issued, always understanding the control which I have already described.

’Is the Governor of the Bank of the same opinion which has now been expressed by the Deputy-Governor?

’Mr. Whitmore, I am so much of the same opinion, that I never think it necessary to advert to the price of gold, or the state of the exchange, on the days on which we make our advances.