Bagehot
Page 7
The conspirators moved in the early morning of December 2. They dissolved the National Assembly, arrested the likely leaders of the resistance, seized the semaphore telegraph system and deployed 30,000 troops in Paris alone. Some of the soldiers fired indiscriminately into dwelling places on the Boulevard Montmartre.12
Alexis de Tocqueville, author of Democracy in America, apprised that the coup met with the approval of important segments of English public opinion, composed a lengthy dispatch pleading the righteousness of the conservative resistance. Unsigned, it ran in The Times of London on December 11. “If the judgment of the people of England can approve of these military saturnalia,” de Tocqueville concluded,
and if the facts I have related, and to the accurate truth of which I pledge myself, do not rouse its censures, I shall mourn for you and for ourselves, and for the sacred cause of legal liberty throughout the world; for the public opinion of England is the grand jury of mankind in the cause of freedom, and if its verdict were to acquit the oppressor, the oppressed would have no other resource but in God.13
For Bagehot, the coup d’état was a tonic. He thrilled to the drama, to the action in the streets, to the political spectacle, and to such small physical risks as he personally bore in the role of freelance onlooker. On December 4, two days after Louis-Napoleon’s self-elevation, the young Englishman sallied forth into the Boulevard Saint-Martin to lend a hand in the barricade-building. He tried to rent a window from which to observe the imminent guerre des rues, but the worldly-wise Parisians shooed him away—they knew enough to close the shutters. “I therefore retired,” as Bagehot told his father, “though not too quickly. It is a bad habit to run in a Revolution, somebody may think you are ‘other side’ and shoot at you, but if you go calmly and look English, there is no particular danger.” He could hear the cannon and the musket fire, and he could see the blood in the streets—“a good deal of it.”14 Twenty-seven soldiers and 380 Parisian insurgents were killed, either in fighting, spectating, or summary executions.
Nassau Senior, Oxford’s first professor of political economy, happened to be in Paris, too. Seeing things much as de Tocqueville did, the economist recorded his condemnation in a diary. Bagehot boldly wrote for publication.
Signing himself “Amicus,” the tyro foreign correspondent addressed seven letters from Paris in January and February 1852 to the editor of The Inquirer, an English Unitarian weekly. The first paragraph of the first submission set the ironical tone: “Sir—, You have asked me to tell you what I think of French affairs. I shall be pleased to do so; but I ought perhaps to begin by cautioning you against believing, or too much heeding, what I say.” A foreigner, Bagehot deprecated what he could possibly know or understand. Yet 60,000 words followed.
Bagehot proceeded to defend Louis-Napoleon, to explain away the executions and deportations, to scorn the heroic assemblymen (among whom was de Tocqueville), and to attest to the popularity of the usurper among the “inferior people.” He argued that the imminent threat to civil order justified the coup and all that went with it. The overexcitable French were incapable of governing themselves in a parliamentary system; their national character did not allow it. “My reasons for so believing I shall in this letter endeavor to explain,” Bagehot promised, “except that I shall not, I fancy, have room to say much on the moral defensibility or indefensibility of the coup d’état.” Utilitarian-fashion, he would rather focus on the facts, leaving “ethical speculation” to “Printing-house Square,” that is, to The Times, which had already printed de Tocqueville’s impassioned plea to the English people to take sides with the liberty-loving French. “You will, I imagine,” Bagehot addressed his readers, “concede to me that the first duty of a government is to ensure the security of that industry which is the condition of social life and civilized cultivation.”15
Probably, as Bagehot well knew, the high-minded readers of The Inquirer would concede no such thing. The paper’s own coverage of the coup was anti-Louis-Napoleon. Nor, likely, would The Inquirer’s audience have sympathized with Bagehot’s arch tone, nor with his grating fondness for paradox. It had been reported, “Amicus” reminded his readers, that Louis-Napoleon had squandered his youth at the racetrack, but—the correspondent insisted—there could be no better practical training in probability and statistics than that which Boney’s nephew had wisely given himself among the horse players at Newmarket and the cardsharps at the London clubs.16 Then, too, Bagehot mused, Louis-Napoleon had the virtue of his ignorance: “he has never been a professor, nor a journalist, nor a promising barrister, nor, by taste, a littérateur.”17 Not a few of The Inquirer’s readers pursued those very occupations, as indeed did the ironic and literary correspondent himself.
To his intellectual audience, “Amicus” praised the virtue of stupidity. You can do without clever newspapers—as Louis-Napoleon was daily demonstrating—but not without dull commerce. “By the sound work of old-fashioned generations,” Bagehot posited,
by the singular painstaking of the slumberers in churchyards—by dull care—by stupid industry, a certain social fabric somehow exists; people contrive to go out to their work, and to find work to employ them actually until the evening, body and soul are kept together, and this is what mankind have to show for their six thousand years of toil and trouble. To keep up this system we must sacrifice everything.18
A playful fellow was “Amicus.” Though a professed partisan of Louis-Napoleon, he had, so he related, helped to direct the construction of barricades. He made it seem a bit of a lark. He was at the barricades until one of the deadly earnest revolutionaries—“sallow, stern, compressed, with much marked features” and armed to the teeth besides—chased him away: “it was not too slowly that I departed, for I felt that he would rather shoot me than not.”19
By this point, the Unitarians must have wondered what had become of their Inquirer. “Amicus” was actually contending that France needed a tyrant because business was more important than liberty. In posing this problematic argument, Bagehot was inclined to make light of the suffering of the poor: “Starvable classes”20 and “ruinable persons”21 were among his memorable phrases. These phrases—the paradoxes, aphorisms, provocations—jostled one another in his fast-flowing sentences. It was not so easy to dismiss such a writer out of hand, nor was it soothing to read him.
Perhaps the subscribers had not marked the true measure of the French left, including the anarchist Pierre-Joseph Proudhon, who famously equated property with theft. As the leftist press had been gagged, there was no telling if all the stories about socialist atrocities were true. But if even a quarter were on the mark, the “new reformers” menaced civil society in ways that the autocrat Louis-Napoleon had scarcely dreamt of. “That is what people here are afraid of,” Bagehot went on, “and that is why I write such things,—and not to horrify you, or amuse you, or bore you—anything rather than that.”22
There was certainly no intent to bore in Bagehot’s discussion of national character and racial stereotypes. “The Jews of today are the Jews in face and form of the Egyptian sculptures,” he lightly remarked; “in character they are the Jews of Moses—the negro is the negro of a thousand years—the Chinese, by his own account, is the mummy of a million.” You couldn’t change these things; they just were: “There are breeds in the animal man just as in the animal dog. When you hunt with greyhounds and course with beagles, then, and not till then, may you expect the inbred habits of a thousand years to pass away, that Hindoos can be free, or that Englishmen will be slaves.”¶
Few of Bagehot’s Protestant readers likely fancied themselves inferior to the average Catholic priest. “Amicus” proceeded to disabuse them of that misconception. Suppose, Bagehot addressed both the Unitarian intellectuals and the French radicals, “you succeed—what you call succeeding—your books are read; for three weeks or even a season, you are the idol of the salons; your hard words are on the lips of women; then a change comes—a new actress appears at the Theatre Francais or the Opera�
��her charms eclipse your theories; or a great catastrophe occurs—political liberty (it is said) is annihilated . . . Anyhow, you are forgotten—fifty years may be the gestation of a philosophy, not three its life—before long, before you go to your grave, your six disciples leave you for some newer master, or to set up for themselves. The poorest priest in the remote region of the Basses Alpes has more power over men’s souls than human cultivation; his ill-mouthed masses move women’s souls—can you? . . . Consider the hundred volumes of Aquinas—which of you desire a higher life than that? To deduce, to subtilise, discriminate, systematise, and decide the highest truth, and to be believed.”23
French businessmen tended to take Louis-Napoleon’s side in 1851, as did many English residents in France.24 In London, the Economist was inclined to give “the usurper” the benefit of the doubt—evidence pointed to the existence of a “great socialist conspiracy” that would coalesce in 1852. As between the fractious, troublemaking National Assembly and the tyrant who slapped the politicians in jail, Wilson’s paper leaned toward the oppressor.
No one leaned—either one way or the other—with such verve as Bagehot. His words raced along on the page. You can read widely in contemporary English-language reporting and commentary on the French coup and find nothing half as scintillating as the letters of the still callow twenty-five-year-old. And if this maiden effort in weekly journalism made him no friends among The Inquirer’s influential readership,** it at least proved that he had a calling outside the law. Upon his return to England in the summer of 1852, Bagehot informed his father that he at last had made up his mind. He was renouncing the legal profession “utterly and forever.” He would be a banker after all.25
* In January 1853, Stuckey’s settled for two-thirds of its claim on the Kingsbury church—Bagehot’s father informed the board of directors that there was a problem in the loan documentation. The forgone one-third of the principal was given over to compensating the church faction that had opposed the mortgage. Another £50 was presented to the estate of the late churchwarden, who had led the side that had unsuccessfully fought to enforce payment of the debt. Stuckey’s Banking Co. Ltd., Director’s Minutes, Royal Bank of Scotland Archives STU3.2 (28 September 1848–27 January 1854), 190.
† In his 1848 review of John Stuart Mill’s Principles of Political Economy, Bagehot seemed to concede Hutton’s point: “The admirable qualities of mind displayed in it, and the extensive research out of which it has sprung, make it necessary for the critic to practice a humility to which he is perchance but little accustomed.”
‡ At mid-year 1851, Stuckey’s showed year-over-year growth in earnings and assets in excess of 12 percent. The accounts, commented the directors, “will be found to be of a very satisfactory nature.” A small persistent concern was the dwindling outlook for the bank’s investment in the Bridgwater & Taunton Canal Company, then encountering stiff new competition from the Bristol & Exeter Railway. For a creditor, progress is not always a net benefit.
§ And not exclusively Paxton’s. “Sparrow-hawks, Ma’am,” was the Duke of Wellington’s succinct advice to Queen Victoria on how to remove the sparrows that had nested in the roof of the Crystal Palace.
¶ Compare William Hazlitt in his essay “Hot and Cold”: “I should say then that Northern people are clean and Southern people dirty as a general rule, because where the principle of life is more cold, weak and impoverished, there is a greater shyness and aversion to come in contact with external matter.” And: “The dirt of the Italians is as it were baked into them, and so ingrained as to become a part of themselves.” Or Disraeli, in Coningsby, who has his hero and alter ego, Sidonia, declare, “All is race—there is no other truth.” If Bagehot has shocked posterity with his racial musings, he very likely upset few of his contemporaries.
** Richard Taylor, proprietor of Britain’s largest scientific publishing house, wrote to the editor of The Inquirer to protest “Amicus’s” decision to ignore the morality of the coup (ostensibly because there wasn’t room to fit it in): “As to the speculations of any one who would leave out of question the morality of an atrocious stroke of statesmanship and only advert to its supposed beneficial consequences, and present adaptation to the wishes of certain classes, I confess that I hold such speculations very cheap . . .”
CHAPTER 4
THE LITERARY BANKER
“Mr. Bagehot, having requested that his son, Mr. Walter Bagehot, might be allowed to attend at the Bank at Langport, with a view to making himself acquainted with the business, his wish was acceded to.”
—Minutes of Stuckey’s Banking Company, June 17, 18531
Walter Bagehot’s father showed more confidence in his son than Walter did in himself. In preparation for joining the family bank, the refugee from the law* lived in Langport to make a study of double-entry bookkeeping. He admitted that the theory of accounting “is agreeable and pretty, but the practice perhaps as horrible as anything ever was.”2 The student who had kept up with the pyrotechnical intellect of Augustus De Morgan at University College could not seem to add or subtract. “If only,” Bagehot playfully moaned to a school friend, “my relations would admit that sums are matters of opinion.”3
The elder Bagehot’s request was granted; his fellow directors could hardly refuse him the courtesy. Besides, talent like Walter’s did not walk in the door of a country bank every day. Rare in banks of any size was the trainee who had already written a penetrating article on English monetary affairs and filed masterful dispatches from strife-torn Paris (the ability to think straight in a crisis is always a desirable quality in a banker).
Walter was as lucky in his employer as his employer was in him. Solvent, profitable, growing, and well-managed, Stuckey’s was an ideal place to begin work, even if that work entailed life under the roof of his unbalanced mother and a father who doubled as his daytime boss.
Happy, too, was the timing of Bagehot’s arrival. Gold strikes in California and Australia in 1849 and 1851 gave his career a monetary tail wind: English prices had been sinking since the close of the Napoleonic wars, but presently started to rise. The downward creep in interest rates, too, soon reversed. As recently as 1852, Stuckey’s had been overwhelmed by deposits; there seemed no place to invest them. But by 1853, the demand for money was catching up with the ample supply.
Money is the measure of capital. It’s capital—a train, a factory, an idea—that creates wealth. Capital springs from invention and enterprise, and as those things flourish, so may wealth grow.
Take, for example, a Victorian epitome of that invention and enterprise, the resplendently named Isambard Kingdom Brunel, former chief engineer of the Great Western Railway, designer of Paddington Station, builder of the Clifton Suspension Bridge in Bristol—and consulting engineer in the construction of the Great Bow Bridge in Langport. In 1852, aged forty-six, Brunel made a doodle in his diary, underneath which he jotted, “Say 600 ft x 65 ft x30 ft.” The dimensions described a seagoing ironclad six times larger by volume than anything then afloat. The naval architect John Scott Russell, whom Brunel had met at the Great Exhibition, declared that Brunel’s conception could swim. Plans for the Great Eastern—or, as Brunel affectionately dubbed his creation, “Great Babe”—moved forward.
Not in just any age could a man like Brunel find the ideas, capital, and liberty with which to mobilize imagination. Reasons not to reach too far ordinarily appear more persuasive than the case for untried action—certainly so in private enterprise. What set the 1850s apart was the confidence that something wonderful was about to happen. “Good luck to the new world citizen!” effused Karl Marx to a private correspondent in 1852. “There is no more splendid time to enter the world than the present. Australia and California and the Pacific Ocean! The new world citizens won’t be able to comprehend how small our world was.”4
If the factory hands were happy “beyond what we have ever before witnessed,” or so claimed a Manchester cotton merchant in 1852,5 stock-market bulls were transported. A 2 p
ercent Bank Rate—as the Bank of England’s principal interest rate was, and is still, called—posted in April 1852, as well as rising Australian gold imports, went far to explain how the once sedate shares of the Australian Agricultural Company rose twenty-fold on the strength of one errant report of a gold strike on the corporate sheep pasture. Shipbuilders could hardly keep up with the demand for vessels to accommodate the thousands of eager Britons seeking passage Down Under.
Commodity prices, stock prices, ship prices, train traffic, interest rates, and wages were all on the hop. In the first six months of 1853, average wages climbed by 10 to 20 percent, gains that, as some contended, were little more than incomplete restitution for the pay forgone in the Hungry 1840s. Even so, not all enjoyed these improvements. In October 1853, in Preston, Lancashire, 20,000 unionized laborers6 went on strike for a 10 percent raise. They returned to work on May 1, 1854, not one penny better off than before.†
As for that golden influx, it was not Britain’s to keep: relatively high prices and relatively low interest rates sent the bullion packing to more attractive destinations. As there were imports to pay for and a granary to stock, English interest rates rose to assure that the outflow did not become a torrent. Bank Rate stood at 3.5 percent at the end of August 1853. It rose to 4 percent on September 1, 4.5 percent on September 15, and 5 percent on September 29.
Even so—strikes, emigration, volatile interest rates, and short crops notwithstanding—1853 was a standout year in a singular decade. In Britain between 1850 and 1860, pig iron production climbed by 53 percent, coal production by 62 percent, cotton imports by 109 percent, installed horsepower of the British textile manufacturing industry by 21 percent, and railway mileage by 49 percent.
Such wonders of production did not come out of nowhere: population growth, technological progress, a stable currency, and intellectual ferment crystallized them. Free trade (the Economist sometimes reverentially capitalized the initial letters “F” and “T”) had proved every bit the boon that Richard Cobden, John Bright, and James Wilson had promised.‡ In the span 1815–45, between Waterloo and the final year of the Corn Laws, the value of British exports had grown at a crawl, from £51.6 million to £60.1 million. In 1853, they weighed in at £98.9 million. By 1860, they would reach £136 million.