our circulating medium, so as to effect the reduction of the price of gold conjointly with other articles: but if our prices, as is possible, are really produced by the effect of our taxes, a diminution of the quantity of currency by which they are paid would greatly increase their pressure. Such a measure would be an attempt to lighten a burthen by diminishing the means to bear it; if it tended to diminish the price of bullion, it would increase the effects of our taxes: and if it also led to diminish productive industry, by narrowing the power of exciting it, it would be difficult to calculate to what extent such an evil might spread, and I am at a loss to conceive how it would be compensated.
If it be admitted that prices may be reduced, and facilities for export increased, by a contraction of our circulating medium; it must be admitted, under this proviso, that there shall not be any counteracting circumstances,—and are there none of this description? And is not the great amount of our taxation the strongest principle of counteraction which can be imagined?
Our taxes, including the expenses of collection, are about 55 millions; our circulating medium, including Country Bank Paper, is above 50 millions also; so that whatever be the amount of our income, the taxes on one hand, and the currency on the other, bear nearly the same proportion to it. Now it will be allowed, without dispute, that in the exact proportion as the amount of our currency is diminished, the weight of our taxes will be increased. If our currency is diminished ten per cent, the means of paying our taxes will be diminished ten per cent. And as the object of reducing our currency is to diminish prices, so the tendency of increasing the pressure of our taxes, will be to raise prices. And as our taxes and currency are equal in amount toone