second. It is this second debt that
changes the seat of power and the order of things; for it puts it in
the power of even a small part of the holders of bank notes (had they no
other motives than disgust at Pitt and Grenville's sedition bills,) to
control any measure of government they found to be injurious to their
interest; and that not by popular meetings, or popular societies, but
by the simple and easy opera-tion of withholding their credit from that
government; that is, by individually demanding payment at the bank
for every bank note that comes into their hands. Why should Pitt and
Grenville expect that the very men whom they insult and injure,
should, at the same time, continue to support the measures of Pitt and
Grenville, by giving credit to their promissory notes of payment? No new
emissions of bank notes could go on while payment was demanding on the
old, and the cash in the bank wasting daily away; nor any new advances
be made to government, or to the emperor, to carry on the war; nor any
new emission be made on exchequer bills.

"_The bank_" says Smith, (book ii. chap. 2) "_is a great engine of
state_." And in the same paragraph he says, "_The stability of the bank
is equal to that of the British government_;" which is the same as to
say that the stability of the government is equal to that of the bank,
and no more. If then the bank cannot pay, the _arch-treasurer_ of the
holy Roman empire (S. R. I. A.*) is a bankrupt. When Folly invented
titles, she did not attend to their application; forever since the
government of England has been in the hands of _arch-treasurers_, it has
been running into bankruptcy; and as to the arch-treasurer _apparent_,
he has been a bankrupt long ago. What a miserable prospect has England
before its eyes!

* Put of the inscription on an English guinea.--_Author_.

Before the war of 1755 there were no bank notes lower than twenty
pounds. During that war, bank notes of fifteen pounds and of ten pounds
were coined; and now, since the commencement of the present war, they
are coined as low as five pounds. These five-pound notes will circulate
chiefly among little shop-keepers, butchers, bakers, market-people,
renters of small houses, lodgers, &c. All the high departments of
commerce and the affluent stations of life were already _overstocked_,
as Smith expresses it, with the bank notes. No place remained open
wherein to crowd an additional quantity of bank notes but among the