TRANSACTIONS OF SECTION F. 847 



lowest, and so make mercliandise of it and export it into foreign parts.' At all 

 events it gave rise to a sort of currency war between the colonies, each trying to 

 draw away the circulating medium trom others to itself. Thus about 1740 

 Virginia was attracting money from Maryland, and in 1798 the West Indian 

 Islands set about establishing what Mr. Chalmers calls ' retaliatory ratings ' against 

 each other on a considerable scale. 



It would be interesting to follow out the probable results of this method of 

 manipulating the currency ; immediately they would be precisely opposite to the 

 consequences of debasing the issues from the mint. Debasing the coinage means 

 a rise of prices ; enhancing the coin is a lowering of prices all round : it does not 

 increase the quantity of money in circulation ; and while debasing the currency 

 renders the exchanges unfavourable, the object of enhancing- the coin is to attract 

 bullion to the country. In so far as quantities of bullion were secured, there would 

 of course be subsequent readjustments, but the immediate results would be very 

 different from those of debasing the currency, except in one particular. Both 

 methods of manipulating the currency would mean that creditors must accept 

 smaller quantities of silver in satisfaction for existing debts. 



This last does not appear to have been the motive of the Governments at the 

 time ; they seem to have been actuated by a reasonable desire to attract currency 

 or prevent a drain of coinage, and to have pursued their aim by a method of very 

 questionable honesty, but well calculated, under the circumstances, to attain the 

 wished-for result. The conditions under which ' enhancing the coinage ' can be 

 successfully practised so as to influence internal prices are unlikely to recur in the 

 business communities of the world ; and there is little motive to have recourse to 

 it, since it yields no immediate gain to a Government ; but there is at least a 

 scientific interest in noting bow this method of manipulating the currency 

 TTorked in a state of business relations with which many of us are unfamiliar. 



2. Some Economic Consequences of the South African War. By L. L. Price. 



There is a tendency to attach an unreal importance to divisions of time like 

 those parting one century from another ; but the end of the nineteenth century is 

 accompanied by a series of remarkable events. At the beginning of the century 

 England was engaged in the Great War with Napoleon, which, in addition to 

 direct influence on the finances of the country, postponed the progress of fiscal 

 reform, caused the suspension of cash payments, assisted the alarming growth of 

 pauperism, aggravated the evils of the early Factory System, and was followed by 

 prolonged depression. The South African War, with which we have been occu- 

 pied at the close of the century, is not, so far as its direct financial consequences 

 are concerned, an economic event of the same magnitude. AVar is indeed more 

 costly now, but the duration of the war with the Boers will bear no comparison 

 with the twenty years of the Napoleonic contest. It may occasion a considerable 

 permanent increase in military expenditure ; but the sums involved in the two cases, 

 taken absolutely, are very difierent, and, measured by the material resources of the 

 nation, the earlier figure was enormous, while the later is trifiing. The increased 

 military expenditure may be accounted, on a strict interpretation of the term, 

 ' unproductive,' and the growing pressure of foreign competition in our own manu- 

 factures and trade, coupled with the increasing cost of obtaining the coal which is 

 still the source of much motive power, and the large additions made to local and 

 municipal indebtedness, may render it desirable to husband resources and avoid 

 augmentation of the National Debt. The Transvaal, however, will bear part of the 

 direct expenditure of the war, and, even when the indirect burden is brought into 

 the account, the total weight may be described as inappreciable, contrasted with 

 the strain imposed by the Great War. But some of the possible economic effects 

 of the later contest deserve attention ; for it has been a disturbiug factor, which 

 may supply the force needed to more the currents of action from a groove in which 

 they had settled. Passing by some obvious immediate consequences to the labour 

 market and to trade, three points demand especial notice. 



(1) In the first place, the influence of an increaSe'd output from the mines of 



