Rhyme of History: The Banks, the City, and England

"From the time I took office as chancellor of the exchequer I began to learn that the state held in the face of the Bank and the City an essentially false position as to finance.

When those relations began, the state was justly in ill odour as a fraudulent bankrupt who was ready on occasion to add force to fraud. After the revolution it adopted better methods though often for unwise purposes, and in order to induce monied men to be lenders it came forward under the countenance of the Bank as its sponsor.

Hence a position of subserviency which, as the idea of public faith grew up and gradually attained to solidity, it became the interest of the Bank and the City to prolong.

This was done by amicable and accommodating measures towards the government, whose position was thus cushioned and made easy in order that it might be willing to give it a continued acquiescence. The hinge of the whole situation was this: the government itself was not to be a substantive power in matters of finance, but was to leave the money power supreme and unquestioned.

In the conditions of that situation I was reluctant to acquiesce, and I began to fight against it by financial self—assertion from the first, though it was only by the establishment of the Post Office Savings Banks and their great progressive development that the finance minister has been provided with an instrument sufficiently powerful to make him independent of the Bank and the City power when he has occasion for sums in seven figures.

I was tenaciously opposed by the governor and deputy—governor of the Bank, who had seats in parliament, and I had the City for an antagonist on almost every occasion."

William Ewart Gladstone