ABSTRACT

This book was conceived in order to make sense of a concept that many eighteenth-century writers found difficult: public credit. Public credit, in its most familiar definition, is the debt owed by a central government, or the debt issued by a central government for purchase by interested parties backed by promise-to-pay coupons. What made the English version of public credit so unique was a set of technologies that were unprecedented at the time. The Crown, needing to borrow money to finance imperial wars, contracted with private businesses that consolidated private creditors – financial actors – looking to benefit. Public credit was seen as a threat to those not already participating in the world of finance and was therefore routinely subject to debate and critique. These eighteenth-century debates will likely resonate with readers today, as they reflect fears that finance is ultimately a rigged game designed to enrich a few at the expense of the many. There was, therefore, also a social dimension to these financial innovations, which this book explores by examining eighteenth-century fiction. When one imagines credit today, one perhaps thinks of a fair system mediated by accounting and other proto-scientific practices backed by institutions.1 However, this is very much a modern mindset. Early public credit required a feedback loop in order to function: As long as there was commitment from the public, it worked; and as long as it worked, there was commitment. Because many saw this new form of credit as serving particular political and financial interests – of the City, the Bank of England, the stock market, etc. – there were many detractors whose writings suggested that ‘monied interests’ posed a threat to traditional social values, which tended to be based in landed interests. The premise of this book is that the discursive terrain of fiction – and especially the novel – is one place where the epistemological, social, and economic consequences of public credit are explored and where the ‘public’ of public credit is both simulated and promoted. The development of public credit had already been underway in the seventeenth century,2 but many scholars point to the establishment of the Bank of

England in 1694 as a significant turning point.3 The Bank was established as a short-term solution for both increasing the money supply by issuing paper credit instruments and also financing wars that protected and promoted commerce. Public credit facilitated through the Bank may have been a non-permanent solution, but it became increasingly stable as the century progressed. By the nineteenth century, when the Bank gained its monopoly, it even facilitated the predominant form of capital, as Bank of England notes – partly owing to their unique combining of the government bond with the bill of exchange – rose very quickly in the hierarchy of monetary forms, becoming the unit of account for all transactions.4 Public credit allowed for paper money to proliferate as a trustworthy medium of exchange, resolving problems inherent to both coined money, which was often clipped and therefore subject to doubt, and private credit, which meant evaluating a person’s reputation.5 The rise of public credit – which implies trust in government institutions – allowed modern money to be defined as an impersonal mechanism that serves as a store of value, a medium of exchange, a standard of deferred payment, a measurement of value, and the unit of account. While there is evidence that public credit had begun to function in the 1660s, there was still much resistance throughout the eighteenth century, partly because of older social value systems and partly because there was little incentive for non-investors to think of their worlds in financial terms: in terms of risk and uncertainty, in terms of accounting and credit, and in terms of practices of consumption. Eighteenth-century fiction, especially the novel, accommodates financial ways of thinking to those not already attuned to the world of finance. Fiction, I am suggesting, plays a role in what historians have identified as credible commitment. Credible commitment, a term used to describe the way in which people come to trust their institutions, was made more pertinent within scholarly discourse through the publication of Douglass C. North and Barry R. Weingast’s seminal article “Constitutions and Commitment: The Evolution of Institutions Governing Public Choice in Seventeenth-Century England” in 1989 in The Journal of Economic History. North and Weingast’s paper discusses the consequences of the political changes that occurred around the time of the Glorious Revolution in 1688-9, and it argues that this period ushered in a new ideological climate favorable to capitalism and hostile to State intervention in the economy.6 The argument in this article associated credible commitment with the legal protection of creditors and taxpayers, a commitment to servicing the National Debt, and an idea of public credit that emerged around 1688.7 The notion is important because what is at stake is that citizens trust government institutions enough to invest in them. But this comes with a caveat that institutions, at the same time, “limit economic intervention and allow private rights and markets to prevail in large segments of the economy.”8 The credible commitment thesis is, therefore, tied up with important questions about the relationship between the State and participants in the economy at large. What discussions of this thesis have not yet accounted for is the way in which those who would have had no reason or incentive to see themselves as tied

together as economic players became interested in financial matters. What is at stake has to do with the separation out of the public and private spheres and a need for finance to penetrate the latter. Fictional texts allow the outskirt segments – the intimate recesses of the domestic household – to become part of the economy at large insofar as they acclimate the reader to a new world of finance. Randy Martin calls this process “financialization,” and he argues this is a product of the late twentieth century, describing techniques by which “personal finance becomes a way in which ordinary people are invited to participate in that larger abstraction called the economy.”9 This invitation to participate, exacerbated in recent times by mobile phone banking apps and day trading, was a long time coming, which is why I refer to the individual characters featured in novels (as well as the implied readers) as emergent ‘financial subjects.’ Representing Public Credit attempts to contribute to the scholarly discussion of the credible commitment thesis, which so far mainly takes place in the disciplines of history and the social sciences, by examining fictional literary texts in the eighteenth century through a literary-historicist analytical framework. As scholars have already been keen to point out, credible commitment does not merely happen ‘from above’ through changes in political or legal institutions10 but also ‘from below,’ insofar as terminologies, ideologies, and ways of thinking transform themselves. By attempting an interdisciplinary method in which I weave together historical accounts of the institutional changes as well as the intellectual or imaginative factors that contributed to credible commitment, this project provides a clearer sense of a larger transformation – what historians often describe as a transition from feudalism to capitalism.11 In so doing, I hope to further contribute to the scholarly discussion on the eighteenth-century novel, a new genre that emerges in tandem with the rise of public credit during what P.G.M. Dickson calls “the Financial Revolution in England.”12