The South Sea Bubble and The Freedom of Speech

Political criticism had new reason to be vitriolic when, in 1720, the “South Sea Bubble” burst and economic disaster hit England. The stock of the private South Sea Company, which had taken over the national debt in exchange for trading rights, sky-rocketed and then plummeted. The crash spelled disaster not only for individual shareholders, but also for the nation whose debts the company had pledged to pay.

This event was the starting point for a series of letters in the London Journal written by John Trenchard and Thomas Gordon under the name of Cato. Calling for vengeance against those responsible for the losses, and attacking by historical parallels those ministers who sought to rescue the South Sea Company or to allow profiteers (many of whom had broken no law) to go free, Cato’s Letters stepped on important toes.

Assailed as the voice of the mob, Trenchard and Gordon replied:

The Word Mob does not at all move me, on this Occasion, nor weaken the Grounds which I go upon. It is certain, that the whole People, who are the Publick, are the best Judges, whether Things go ill or well with the Publick.

The letters were careful to name no names and to praise constantly the wisdom and virtue of the King, Parliament, and the ministers. The praise, however, was couched in terms of expectation of wise future action, so that contrary measures subsequently taken would bear the imputation of being taken by stupid and evil persons. Buffeted by attacks in the government press and buoyed by popular response, Trenchard and Gordon discussed in several essays the nature of government and specifically the proper role of free speech.

Number 15 of Cato’s Letters, entitled “Of Freedom of Speech: That the same is inseparable from Publick Liberty,” focused on the contribution of free speech to the preservation of liberty. The essay begins:

Without Freedom of Thought, there can be no such Thing as Wisdom; and no such Thing as publick Liberty, without Freedom of Speech: Which is the Right of every Man, as far as by it he does not hurt and controul the Right of another; and this is the only Check which it ought to suffer, the only Bounds which it ought to know.

From the Maryland Law Review.

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