19th century letters reveal the mood in Britain when inflation reached the highest levels in history
Current inflationary struggles encompass some of the highest increases in living memory, but current increases pale in comparison to the exceptional case of the year 1800, when inflation hit a dizzying 36% in Great Britain. Brittany. He is the most famous character in British history.
The explanation given for this incredible rise was that the 20 years of Napoleonic wars had depleted the country’s resources and an ever-increasing demand caused by the industrial revolution. The economy struggled to provide enough arms, food, and fuel for the army and navy, and shortages arose in all kinds of daily consumer goods. This drove up the price of clothing, drinks, candles, coal, animal meat, dairy products and grains, so that the ordinary person treated increases for most items they would seek to purchase.
The price of these goods had been rising for decades because an increase in population and a decrease in the death rate meant an increase in demand. Given the incredible increases, wages struggled to keep up, so how did the government analyze the situation at the time?
Correspondence addressed to the Earl of Liverpool by the Office for Trade offers some insight into the tension in the streets. The Office representative describes crowds of people in Bishopsgate protesting against the price of bread, gathering and shouting in the streets of London.
Another correspondence (below) addressed to the count describes the atmosphere of the country as a whole.
The arguments in favor of price controls are varied, both in the Liverpool Papers and in correspondence to Prime Minister William Pitt, the Younger, including pleas on the spiraling cost of meat and the price of salt needed by fishermen wishing to preserve fish. In addition to petitions from various industries, one can also see a growing ideological battle over the right economic stock price.
Two members of the House of Lords, Lord Buckingham and Lord Grenville, wrote to Pitt about the inflation crisis, warning the Prime Minister not to attempt to legislate to control prices.
In the above letter, Lord Buckingham states that the best that can be done is to “regulate a measure but to which all grain and flour shall be sold”, but no attempt should be made to control market prices afterwards .
Lord Grenville agrees and even draws on his principles in Adam Smith. the wealth of nations, published 24 years earlier. Lord Grenville describes how he and Pitt were skeptical of the free market theory, but eventually came to terms with it.
While the government was discussing the big stories of the economy, the people had to weather the inflation crisis. Production and growth were still on the rise, and as a result many were making the profits needed to ride out the inflationary crisis.
Labor in the northern cities at the heart of industrial production actually saw their real wages rise, because the demand for labor was so high, but the average worker in London saw their real income to lower. This particular inflation crisis would be short and painful, as a massive fall in inflation in 1803 would cause prices to adjust, but such fluctuations would continue throughout the 19th century.
This article was first published on the British Library’s Untold Lives blog.