3.1   James Mill, the radicals’ Lenin

James Mill (1771–1836) was surely one of the most fascinating figures in the history of economic thought. And yet he is among the most neglected. Mill was perhaps one of the first persons in modern times who might be considered a true ‘cadre man’, someone who in the Leninist movement of the next century would have been hailed as a ‘real Bolshevik’. Indeed, he was the Lenin of the radicals, creating and forging philosophical radical theory and the entire philosophical radical movement.

4.1  The conundrum of Ricardo’s popularity

4.2  The rapid decline of Ricardian economics

4.3  The theory of rent

4.4  Colonel Perronet Thompson: anti-Ricardian Benthamite

4.5  Samuel Bailey and the subjective utility theory of value

4.6  Nassau Senior, the Whately connection, and utility theory

4.7  William Forster Lloyd and utility theory in England

4.8  A utility theorist in Kentucky

4.1   The conundrum of Ricardo’s popularity

What accounts for the popularity of Ricardo’s Principles, and for the enduring dominance of the Ricardian system? The marginal utility ‘revolutionary’, W.

5.1  The restriction and the emergence of the bullionist controversy

5.2  The bullionist controversy begins

5.3  Boyd’s Letter to Pitt

5.4  The storm over Boyd: the anti-bullionist response

5.5  Henry Thornton: anti-bullionist in sheep’s clothing

5.6  Lord King: the culmination of bullionism

5.7  The Irish currency question

5.1   The restriction and the emergence of the bullionist controversy

The Bank of England had been the bulwark of the English (and, by serving as bankers’ bank, of the Scottish) banking system since its founding in 1694. The bank was the recipient of an enormous amount of monopoly privilege from the British government. Not only was it the receiver of all public funds, but no other corporate banks were allowed to exist, and no partnerships of more than six partners were allowed to issue bank notes.

6.1  Ricardo enters the fray

6.2  The storm over the bullion Report

6.3  Deflation and the return to gold

6.4  Questioning fractional-reserve banking: Britain and the US

6.5  Monetary and banking thought on the Continent

6.6  Notes

6.1   Ricardo enters the fray

The bullionist controversy sank into oblivion for five years after 1804, largely because a cautious policy on the part of the Banks of England and Ireland temporarily abated the monetary inflation and its unwelcome consequences. Then, during 1809, the heating up of the war with Napoleon rekindled the inflation, bank note circulation increasing from £17.5 million in November 1808 to £19.8 million the following August.

7.1  The trauma of 1825

7.2  The emergence of the currency principle

7.3  Rechartering the Bank of England

7.4  The crisis of 1837 and the currency school controversy

7.5  The crisis of 1839 and the escalation of the currency school controversy

7.6  The renewed threat to the gold standard

7.7  Triumph of the currency school: Peel’s Act of 1844

7.1   The trauma of 1825

In 1823, the British economy finally recovered from the post-Napoleonic War and post-1819 agricultural depression. In fact, an expansionary boom got under way, so much so as to quieten the vociferous agricultural advocates of higher prices and the opponents of the return to gold. Unsurprisingly, Bank of England credit expansion led the way in this new inflationary boom, its total credit rising from £17.5 million in August 1823 to £25.1 million two years later, a huge increase of 43 per cent or 21.7 per cent uncompounded per annum.

8.1   Mill’s importance

8.2  Mill’s strategy and the success of the Principles

8.3  The theory of value and distribution

8.4  The shift to imperialism

8.5  The Millians

8.6  Caimes and the gold discoveries

8.7  The Millian supremacy

8.8  Notes