The Project Gutenberg eBook of Thoughts on the mechanism of societies
This ebook is for the use of anyone anywhere in the United States and
most other parts of the world at no cost and with almost no restrictions
whatsoever. You may copy it, give it away or re-use it under the terms
of the Project Gutenberg License included with this ebook or online
at www.gutenberg.org. If you are not located in the United States,
you will have to check the laws of the country where you are located
before using this eBook.
Title: Thoughts on the mechanism of societies
Author: Marquis de Casaux
Translator: Parkyns Mac Mahon
Release date: July 1, 2024 [eBook #73958]
Language: English
Original publication: Snowhill: T. Spilsbury, 1786
Credits: Charlene Taylor and the Online Distributed Proofreading Team at https://www.pgdp.net (This file was produced from images generously made available by The Internet Archive/American Libraries.)
*** START OF THE PROJECT GUTENBERG EBOOK THOUGHTS ON THE MECHANISM OF SOCIETIES ***
THOUGHTS
ON THE
MECHANISM
OF
SOCIETIES.
By the MARQUIS DE CASAUX,
FELLOW OF THE ROYAL SOCIETY.
_TRANSLATED FROM THE FRENCH_
(_Under the Inspection of the Author_)
By PARKYNS MAC MAHON.
_If Men would be content to graft upon Nature, and assist her
operations, what mighty effects might we expect!_
SPECTATOR.
_LONDON,
Printed by T. Spilsbury, Snowhill._
Sold by G. G. J. and J. ROBINSON, in _Pater-noster Row_;
W. RICHARDSON, under the _Royal Exchange_; and
J. DEBRETT, _Piccadilly._
M,DCC,LXXXVI.
PREFACE BY THE EDITOR.
It is not a _treatise_ that the Author announces; it is nothing more than
_Thoughts on the Mechanism of Societies_. Such a title does not confine
a Writer to a regular plan; it saves him even the risk of preparing
his Readers for a chain of ideas which cannot escape their sagacity if
it exist, and on which they cannot be deceived if it do not. But in a
picture consecrated to the world at large as well as to his own Country,
to the People as well as to their Rulers, it was necessary that the most
striking object, the object to which their first attention was called,
should be of so general an interest, as to entice them progressively
to an investigation of all those details which deserve most to be
scrutinised, and of which the different relations are either little
known, or greatly mistaken.
The object which at present fixes the attention of all the States in
_Europe_, (all of them either debtors or creditors), is the _National
Debt of England_, and the measures which will be taken on that subject
by the Assembly the most clear-sighted of any in the world to every
thing that concerns the interests of the people, the most jealous of its
rights, and the most free, at least in its debates. It is by considering
that formidable debt, and its influence on the wealth of the State and
the ease of the People, that the Author dares to begin. But before he
proceeds to unfold the mechanism of the national debt, the result of
which developement presents some ideas too opposite to the received
opinion, he endeavours by degrees to familiarise his Readers with his
own, by _some general reflexions on the present situation of England_:
these reflexions leave him no room to doubt, that _England_ was in
1779, _notwithstanding the national debt_, richer than she was at the
beginning of this century;—richer, either in a fourfold, or in a double
proportion, as the Reader is disposed to adopt the one or the other rate
of population: whence it appears that the Author, in respect to his plan,
does not affix any importance to the difference of opinions on this
article.
_A more particular view of the subject_ furnishes him with fresh reasons,
which seem to him sufficient to quiet the mind of the most suspicious
creditor. It is, indeed, only by means of the _savings_ made, or daily
to be made, upon eight pence (the exact proportion each individual is
entitled to in the general revenue), that it has been possible to reach
the summit of opulence, and that it is possible to be fixed there:
but the Author seeks for such _savings_ in agriculture and industry,
as cannot be misunderstood; he observes that the savings made in
agriculture, have proved sufficient, in the course of a century, not
only to discharge all the public burdens, but even to double the landed
revenue; and he then enters into a detail of several objects, (all easy
to be ascertained,) which seem to demonstrate a similar progress in
industry.
Here our Author, beginning to feel himself on ground sufficiently firm,
confesses that he sees nothing in the present situation of _England_,
tending to justify the idea of a national bankruptcy, although the
public news-papers often hint at the convenience of such a measure. The
author even so far forgets himself, as to examine _seriously_, whether
it would be profitable or unprofitable to effect the so much recommended
_reimbursement_, _even on the supposition that the 238 millions which
have been borrowed, and have disappeared, could find their way back to
the Exchequer_.
After having presented the question under several points of view, our
Author hesitates not to declare for the negative, and then endeavours
to prove that a previous _thesaurisation_ which might have enabled the
nation to go through the last war without laying any additional tax,
would have done more harm than the new taxes can possibly have done.
The Author, become bolder because he meets with no contradiction when he
is alone, (and indeed he is alone very often) undertakes to reconcile
mankind to the taxes by means of a first decomposition of the impost;
he gives up, it is true, one part of it as burdensome, (it is truly to
be lamented that this part cannot be dispensed with; luckily it is the
least); but he contends boldly for the other part, as a very precious
resource for that portion of the people which best deserves to engage the
cares of Government.
Notwithstanding all the precautions taken by the Author not to frighten
his readers, there remains such a leap for him to clear, that he is seen,
as it were on his knees, begging he may be permitted to try twenty
times, if he cannot clear it in ten: in other words, he earnestly wishes
that his work may not receive its final judgement before it has been
perused to the end; and in fact, it is not impossible but that a detached
proposition, the absurdity of which is striking when considered singly,
may be found conclusive when successively brought near to all those that
are to follow it.
An Editor owes more to the Public, than to any work, even such as he
could wish to bring into some trifling repute: I think then, it is my
duty (_in foro conscientiæ_) to declare, that it will not be till the
Reader has perused fifty pages or more, that he will suspect the reason
why the Writer has not announced in the very first, some singular
opinion, which he meant insidiously to establish as it were step by step
in his pamphlet; but, at length, we begin to have some notion of what we
are to expect from a man who has been trying to wheedle us into a belief,
that _taxes are a trifling evil;—that ~thesaurisation~ would be a very
great one;—that a reimbursement is at best useless_;—and who afterwards
modestly intimates, that some singularities may perhaps escape him _in
the sequel_; as if it were possible to imagine any thing more singular
than the three propositions I have just quoted.
Yet too much severity should not be used. Has the Reader been but amused
with the part of the picture hitherto exposed to his view? Let him
humour the Author in his little conceits. Who would exhibit for public
entertainment, if he were not at liberty to draw up the curtain in his
own way; if he had not a right to display, at every shifting of the
scene, that part only of his curiosities upon which he meant for that
instant to fix the eyes of the spectator?
But if the Reader, in spite of the different positions into which he has
been attracted, has not observed the least alteration in the compass;
if he has not been moved by the arguments with which he has been lured
before he came to that part of the work—let him throw the piece into
the fire; for the Author, of whom I do not pretend to imitate the
circumspection, or adopt the fears, or justify the temerity, or share
in the guilt, aims at nothing less than to induce _all Europe_ (all
_Europe_!) to investigate,
_1st_,
Whether it could possibly cost _England_ more than 5 millions sterling,
(_found once for all_) to secure _for ever_, in the most solid manner,
the payment of the interest on a debt of 238 millions, that interest
rated at 9 millions, of the same currency?
_2dly_,
Whether there be not, (without its being suspected), in the system of
finance in _England_, some of those imperfections so well remarked, so
fully, so bitterly criticised in that of _France_; and whether a national
reimbursement be not the easiest of all the sports a Minister of finance
can think of, to amuse society without serving it?
_3dly_,
Whether the possibility of a balance of trade, _always favourable_,
be not as doubtful as the necessity of a national bankruptcy, and the
advantage of a national reimbursement?
_4thly_,
Whether an equilibrium in all things (and every where), be not
indispensable; and whether, to maintain or restore it, any great effort
of imagination be required on the part of those who fancy they hold the
balance?
_5thly_,
Whether the difference of prices be something or nothing; and whether
more has been wanted by the _French_ than 66 millions _Tournois_ (_found
once for all_), to secure _for ever_, the interest at _5 per cent._ on a
national loan of 1,500 millions _Tournois_?
_6thly_,
Whether the monster of a competition (in point of trade) supposed
unconquerable on account of the low prices with which it should be armed,
be not as fantastical as that of a balance always favourable?
_7thly_,
Whether the most justifiable premium for exportation be any thing more
than one piece of injustice, become necessary to counterbalance a great
many others?
_8thly_,
Whether it do not result from the ever infallible and merely mechanical
restoration of an equilibrium in all the prices, that the taxes are in
themselves completely innocent;—whether there be more than one kind
of taxation, which increases only by the exact amount of the tax, the
whole mass of prices;—whether the effect of taxation be not trebled by
all other imposts;—whether the most pernicious of them, (after the
poll-tax), be not the tax on luxury;—and whether from the instant that
all kinds of taxes, either judiciously or injudiciously contrived,
have re-acted on every thing, the burthen of the national debt is not
literally _null_ in all countries?
_9thly_,
Whether, _after monopoly_, credit be not that effect of wealth which
increases most the price of every production, both of agriculture and
industry?
_10thly_,
Whether a certain country, where smuggling has been prohibited under pain
of the galleys, be not indebted to smuggling itself for one fifth of the
products of her agriculture, which the merchant and trader turn to their
advantage with as little scruple, as if they had not petitioned for the
detestable law against the smuggler?
_11thly_,
Whether the absurdity of the general opinion, on the most efficacious
means of establishing a profitable competition, in point of trade, be not
clearly evinced, by the account of a strange revolution in _France_—a
revolution, as indubitable as the two wars in 1755 and 1779?
_12thly_,
Whether the impossibility of the two supposed balances, constantly at
the disposal of _England_ and _France_, be not proved, by the very
facts adduced in both countries to establish the existence of those two
monsters?—Whether that impossibility be not demonstrated by other facts
as little equivocal; and whether it be not the interest of _England_ and
_France_ to renounce the Idol, and solemnly abjure both its works and its
pomps?
_13thly_,
Whether imports and exports be not a mere sport, as innocent as the
game of tennis? A sport, nevertheless, which all Governments might turn
to great profit, all Subjects to great advantage, and all States to an
increase of power and wealth.
_14thly_,
Whether the generality of exports from _England_, at different periods,
considered with regard to her foreign correspondence, do not demonstrate
a kind of electricity, unthought of hitherto, though not unworthy of
amusing the greatest politicians at their leisure moments?
_15thly_,
Whether the trifling jest of luxury be not equally as innocent as the
diversion of exporting and importing; and how much the most fastuous, the
most profuse, the most sensual of all monarchs, consumes, above the most
avaricious of all his subjects?
_16thly_,
How much (not counting shillings and pence) _England_ has lost, when her
right-arm, as her colonies were called, was lopped off; and how much
(not counting shillings and pence) _Europe_ might lose by losing her
sovereignty over both the _Americas_?
_17thly_,
Whether all that had appeared to the Author, as founded in reason and
equity, do not finally prove (in spite of the general conspiracy of
all Nations and all Ministers) to be strictly conformable to the most
stubborn facts;—and whether it do not result from that mass of facts
and reasons, that the Author’s assertion, the most interesting to
mankind, (that is, to all Princes and their People) is not of the most
irrefragable truth, and a truth the most easily brought within the reach
of all the parts interested therein?
I, though merely Editor, shall venture still further;—I shall suppose the
result of this combination of facts and reasons to be, that the means
hitherto devised as the most proper to alleviate the burdens of the
people, were the best devised to oppress them: What matters it to the
people, provided they are to be oppressed no longer? What is the time
past, but the baseless fabric of a vision?
I shall likewise suppose, that from those facts and reasons it should
result also, that never was a decrease in the Prince’s revenue more
effectually secured, than by the contrivances devised to increase it:
What is it to the Prince, provided it be no longer possible to mistake
the true means of enriching him?—Is it not the time to come, that should,
above all, engross the attention of a Great Prince?
I shall again suppose, as another result, that it has been a mistaken
notion, to imagine that the revenue of the People must be lessened, in
order to increase that of the Prince:—What is that to the Prince—what is
it to the People—provided both be now convinced, that it is not possible
to enrich the one, either really or nominally, without enriching the
other in the same manner, and in the same proportion?
I shall further suppose, that it should evidently result also, that in
the Administration of the finances of any country, there is not, there
has not been a single principle, nay, not a single idea worthy of the
name: What is this to the Ministers who now hold that department?—Can
they command what is past? And is it not the redressing of abuses, when
discovered, that constitutes the true glory of a Ministry?
To crown the whole, I shall even suppose, that thence also should result,
to a very insignificant individual of _America_, a little sprig of
that _European_ shrub called Bay-tree:—What would that signify to all
the Ministers, all the People, and all the Princes in _Europe_?—Will
_America_ consume less _European_ goods, or will she produce less gold
and silver, for having produced an idea?
ERRATA.
Page 149, last line, for 1581, read 1551.
158, l. 3, for _extravagance_, read _examination_.
194, l. 24, for _20 millions_, read _27 millions_.
198, l. 10, for 46_s._ read 46_s._ 8_d._
308, l. 13, for _will content_, read _will NOT content_.
Transcriber’s Note: The errata have been corrected, along with a few
minor typographical errors.
CONTENTS.
Page
_Thoughts on the Mechanism of Societies._ 1
_A general View of the present State of Great Britain._ 3
_A more particular View of the same Subject._ 12
_Clear Savings of the Manufactories, Trade, and other Branches
of Industry._ 17
_Thoughts on Impost and Reimbursements. The Accumulation of
public Treasure considered as the Means of preventing Taxation._ 27
_On the grievous, but necessary Part of the Impost._ 36
_Of the Part of the Impost which is more useful than grievous._ 41
_Objections of another Kind against paying off the national Debt._ 51
_In what Manner the Interest of the national Debt will be probably
paid off._ 59
_Reflexions on the two foregoing Articles._ 76
_A Thought substituted to that of a Reimbursement._ 83
_General Balance of Trade in ~England~._ 93
_Reflexions on some private Balances of ~England~, both of the
favourable and unfavourable Kind._ 111
_Balance between ~England~ and ~Holland~._ 116
_⸺ between ~England~ and ~France~._ 123
_Further Reasons why all Ideas of a favourable Balance different
from that which I have supposed should be rejected._ 126
_Equilibrium necessary in all Things. Of the surest Means of
establishing it._ 130
_Various Causes of the Alterations in the Prices._ 137
_On the Influences of the national Prices on the Sales in foreign
Markets._ 151
_A necessary Principle of Trade considered both as direct and in
competition._ 159
_Reflexion on a Letter from ~Philadelphia~ inserted in the
~English~ News-papers._ 170
_Under what Point of View Premiums and other Encouragements of
Exportation may be considered._ 182
_On the Influence of the various Kinds of Taxation upon national
Prices._ 188
_On the Object of all Ministers of Finance in laying Taxes._ 192
_Effects of a general Poll-tax._ 193
_Effects of a Land-tax._ 196
_Reflexions on the foregoing System._ 203
_Effects of an Impost exclusively laid on Luxury._ 208
_Effects of a merciless Tax upon all Articles of the most general
Consumption._ 218
_Effects of compound Taxation._ 223
_Some Doubts on the supposed Impossibility of laying all Taxes on
Consumption._ 231
_Recapitulation of the foregoing Thoughts on Taxes, and their
Effects._ 242
_Further Considerations on the Necessity of a Correspondence
between the Prices of Agriculture and those of Industry._ 248
_Of a Cause little suspected of high Prices._ 257
_The happy Issue of a desperate Combat between Monopoly and some
private Interests._ 265
_Reflexions on a very strange Revolution in ~France~._ 270
_The pretended Balance of ~France~ in Point of Trade._ 291
_Exportations and Importations considered as a Game._ 308
_The nominal Value of the generality of Exports considered, with
Respect to its Effect on foreign Correspondence._ 338
_On Luxury._ 352
_On Colonies._ 372
_Preface in ~French~._ 399
[Illustration]
THOUGHTS ON THE MECHANISM of SOCIETIES.
The first step that led to civilisation was, probably, some kind of
slavery, whatever might be its nature. It seems impossible that the
strongest and most industrious, following no other impulse than that
of a consciousness of his superiority, should have come to the noble
resolution of sharing generously, with the weak and idle, the fruits of
his own labours and industry; nor can it be supposed that he could suffer
any one, but himself, to pronounce on the prerogatives due to his courage
and his abilities. But the most consummate knowledge of the means which
may have paved the way to despotism, would throw but a faint light on the
various subjects which I propose to take under consideration. The Epoch
which it may be useful to dwell upon, is that, wherein the chiefs of the
different states, being in no anxiety for an authority which is no longer
contested, are the first to acknowledge its limits, and begin at last to
be solicitous for the happiness of their subjects.
Such, in my opinion, is now the prevailing system all over Europe.
The advantage of true freedom is fully felt, and its influence over
all-commanding wealth universally acknowledged. But, in order to compare
the inferences with the principles, to appreciate the measures by their
effects, I shall fix upon that Nation whose avowed maxims, and best known
circumstances, are most likely to furnish me with a train of arguments,
without having recourse to any further suppositions but such as may
appear necessary to clear up the facts that will be adduced in support of
those arguments, and to render the consequences, to be deduced from them,
more lucid and pointed.
I shall begin with the most interesting article in the present situation
of affairs, namely, how far the wealth of a State, and the affluence of
the Subject, may be affected by a NATIONAL DEBT?
_A general View of the present State of GREAT BRITAIN._
Mr. _Arthur Young_’s valuation of the Revenue, in his Political
Arithmetic, is the result of his own private observations. Nothing ever
occurred to me on the subject, that can come up with the minute accounts
he gives us of the different provinces which he has visited in the north,
south, and east of _England_.
I am ready to suppose, with that gentleman, that the joint revenue
of _England_ and _Scotland_ may be computed, the landed produce and
commercial profits included, at 110 millions sterling.
Mr. _Chalmers_ has published a work on the comparative resources of
this country at different periods; a subject, it seems, difficult to
touch upon without examining the state of population. This publication,
according to my judgement, unites to such solid principles as the matter
will admit, a great deal of propriety in the manner of applying them, and
of drawing the inferences.
I willingly acquiesce, taking it for granted, with the author, that
_Great Britain_ contains 9,350,000 inhabitants: but, at the same time,
I apprise the reader, that I do not mean to take any advantage of a
population more or less numerous; nor of a larger or smaller amount of
the revenue. _Data_ I require; but such I will prefer as most nearly
border on reality. There is not a State to which, with a difference in
the numbers, one may not apply what I have to say concerning _England_,
in those which I have adopted.
It appears from the estimates of Mr. _King_, who, in the reign of
_William_ and _Mary_, proved himself as exact an observer as Mr. _Young_
has done in our days, that the produce of Land alone amounted then to
32,000,000; the latter calculator nearly doubles it, by rating it at
63,000,000. The Custom House books, the exactness of which cannot be
disputed in one of the two facts they vouch to, (_the Burthen of the
Shipping, and the Produce of Exportation_,) will shew that the former,
from the year 1709 to 1773, progressively increased from 289,318, to
775,078 tons; and the years 1697, 1698, 1699, taken upon a medium and
compared with 1771, 1772, and 1773, tend to prove that the gradual rise
of the Exports has been still more considerable, being from 5,612,058_l._
to 16,027,937_l._ (Vide _Sir Charles Whitworth’s State of Trade_).
The foreign trade of _England_ seems therefore to have trebled since the
beginning of the present century. We shall, in the sequel, state the
reasons for supposing the commerce of other nations to have experienced
the same progression.
The annual sum of 110,000,000, divided amongst 9,350,000 inhabitants,
will produce daily little less than 8 pence per head, from the Monarch
down to the meanest subject.
The observations I have made in several parts of _France_, from
documents, it is true, no ways comparable to those of Mr. _Young_,
could not justify my allowing so large a revenue to each individual in
that kingdom. Yet _France_ and _England_ are the two richest and most
flourishing countries in _Europe_.
Mr. _Young_ rates the clear profits of the Manufactories and Trade of
_England_ alone at 37 millions; but as these two objects have apparently
been trebled in regard to the exports, they cannot be supposed to have
exceeded 12 millions in the reign of _William_ and _Mary_. To this let
us add, in a proportion rather exaggerated, 5 millions for the landed and
commercial revenues of _Scotland_; and it will appear, that, including
the 32 millions of landed produce, as computed by Mr. _King_, the total
amount of the revenue, land and trade of both countries included, could
hardly be equal to 49 millions in the beginning of the present century.
Now, from the same author, both kingdoms contained at that period
7,200,000 inhabitants, who, if admitted to a brotherly share, would have
claimed only 4½_d._ each per day. I do not confine myself to a nicer
exactness in the fractions: the object is not to calculate the precise
instant of an eclipse; or at least, that of English prosperity appearing
to me no ways probable, I think myself justified in neglecting every
thing that might impede my operations, without influencing, in the least,
my arguments.
Yet the wages of a journeyman were nevertheless rated then at 8_d._
per day: but let it be observed, that the number of working-days, when
balanced with the holidays, sickness, and want of employment, those eight
pence, distributed in the journeyman’s family, were often reduced to two;
just as the sixteen pence, the present price of labour, according to Mr.
_Young_’s Estimate, commonly amount to 4_d._ only, although the brotherly
share of each man nearly amounts to 8_d._ If any one should be inclined
to call this, injustice, let him consider that this very multitude of
reductions from 4_d._ to 2_d._ and from 8_d._ to 4_d._ from _William
III._ to this present time, has been the only means of accumulating by
degrees that immense stock of 600 millions and upwards, manifestly laid
out by the State in less than a century, and of which the National Debt
makes a part. It is evident that if each individual, from _William III._
had only spent at the rate of 5_d._ per day, there would be no National
Debt; but as each man of the nation could, generally speaking, and upon
an equal proportion, lay out only 4½_d._ per day, the exceeding halfpenny
must have long ago swallowed up the whole principal, the produce of
former reductions.
Not one of the monuments erected since that period would now exist, nor
would a single trace be left of the stocks to which the nation owes
its present wealth: each portion of the national stock, every monument
posterior to that era, prove as many persons reduced in the origin from
4_d._ to 2_d._ and then from 8_d._ to 4_d._ as either of the above two
sums are oftener told in the value of such monument, or such stock as
might be made the subject of inquiry. No country in the world can boast
of a more respectable source of its opulence.⸺This opulence must either
be given up, or the inconveniences that attend it be submitted to. In all
parts of the world the labourer earns a livelihood, and very little above
that: yet this very trifle is sufficient to make him happy, wherever he
cannot be compelled to work without pay. He feels little, never takes the
trouble of thinking, and leaves off work only to eat, make merry, or go
to rest.—Is our lot better, with that fatal degree of reflection by which
our whole life so often centers within a single point?
But is the nation in general as happy in our days as it was in those of
_William III_? Have those causes, which tend to produce a decrease in the
population, no manner of influence on the people’s happiness? And is not
the reality of such causes more self-evident, than the pretended proofs
adduced universally in favour of its increase?
Without entering into any dispute on the merits of the researches
concerning population, which would lead to some truths perhaps unthought
of hitherto; here follow the arguments which will occur to any man who
stands not in need of a fixed and precise number of thinking heads,
laborious hands, and well-digesting stomachs.
1st. It is not easy to conceive how, the landed revenue being nearly
double, there should be a less number of husbandmen; for it is not
with agriculture as we find it in several manufactories, where the
invention of engines, and an alteration in the mode of working, can so
advantageously supply the supposed decrease in the number of hands to
work after the primitive manner. The valuable number of husbandmen seems
therefore, in my opinion, placed beyond even the idea of a decrease.
2dly. It is no less impossible to imagine, that the number of sailors
being nearly in a triple proportion to what it was, and the quantity of
exports probably augmented on account of the burden of the outward-bound
ships, a diminution should have taken place among that class of people,
equally precious to the State, for establishing and ascertaining its
wealth and strength, as the cultivation is indispensable to secure and
support its very existence.
3dly. If, notwithstanding the acknowledged impossibility of proving a
real decrease in the population, any one should obstinately admit of
it, without positive proofs, it cannot at least be denied, that the
produce of land and industry being nearly doubled, some means must have
been devised, to do that with one hand which required two before. In
this case it would be an easy matter to prove, that at the rate of the
supposed depopulation, the few elect, who have escaped its causes, can
boast of enjoyments in a threefold proportion to what they were before,
notwithstanding the difference between the present impost and that which
was paid in the beginning of this century: for, after all, the taxes
under _William III._ amounted to four millions and a half and upwards, to
be deducted from forty-nine millions standing revenue; the balance was
therefore forty-four millions and a half, to be shared amongst 7,200,000
inhabitants, acknowledged by Mr. _King_; that is, very little above 4_d._
per day for each individual. Now, in the year 1779, for I have not yet
exceeded that period, the impost was of about nine millions, which, taken
from an income of 110 millions, left a surplusage of 101,000,000_l._ to
be divided. If we adopt the supposed depopulation at its highest rate,
the number of souls in _England_ is reduced to 4,500,000, each of whom
has 1_s._ 3_d._ instead of 4_d._ allowed in the reign of _William_. It is
then incontestible that the Nation is richer, but, I must own, not more
happy; for they complain and are alarmed at this time, as was then the
case.
It would be necessary to allow the supposition of an increase, if the
intention were to shew that the people are now in a worse condition: nor
could even this be deemed sufficient; for, admitting the existence of
9,350,000 inhabitants, it will appear, that, by the surplusage of 101
millions left, after the discharge of the taxes in 1779, each individual
would be entitled to 7_d._ instead of the groat, in _William_’s reign.
The nation therefore in that year, in spite of its public debt, had
almost doubled its wealth, rating the population at 9,350,000; and raised
it four-fold, supposing the number reduced to 4,500,000 souls: and in
either case, the riches of the State, as well as the national debt, arose
and increased from the daily reductions of 4_d._ to 2_d._ and of 8_d._ to
4_d._ which, since the reign of _William_ to this day, have escaped from
that all-devouring canker, commonly called LUXURY.
_A more particular View of the same Subject._
I wish to inquire more minutely, whether such facts as are known do not
cast a sufficient light over all the others in general, to induce the
most anxious and pressing creditor, and the nicest in point of proofs, to
sleep in the utmost security, till some particular discovery pleads in
justification of his alarms.
The present revenue of _England_ is stated at 63 millions; that of
_Scotland_, at about 7 millions; collectively, 70,000,000_l._ It will
be seen hereafter, that 65 or 75 millions would give the same essential
results: I must however add, if any thing more should be wanted, that,
in his estimate, Mr. _Young_ does not include the horses, hemp, flax,
vegetables, fruit, nor hops, &c. all of which are reproduced annually,
and augment considerably the number of exchanges held out to industry.
This landed revenue is produced by somewhat more than one third of the
inhabitants.
It remains for us now to compute, at the lowest, the income produced
by a second class of people, probably as numerous as the former, since
not less than 1,500,000 persons of both sexes, and of all ages, are
employed solely in preparing and working the wool. (See _Chalmers_’s
Estimates.) But if the labour of 3,000,000 of husbandmen brings in 70
millions annually, why should that of an equal number of mechanics and
handicraftsmen stand for less in the computation? To this reason let the
following remarks be added.
Out of the 70 millions, 20 come to the share of the cultivators, either
as the price of their labour, or for poor’s rates; 12, of these 20
millions, at least, are laid out for the produce of industry: bread, it
may be observed, is comprised in the remaining 8 millions.
Let us state the number of proprietors at 2,000,000, including all
their dependents, under any denomination whatever, women, children,
chaplains, farmers, physicians, strollers, servants, &c. and their annual
expenditure, in the rough produce of the land, at 18 millions, there
remains only 32,000,000, which must be paid by the industry, already in
advance, of the 12,000,000 exchange granted to the cultivator. It is
obvious that I speak here only of that kind of industry which may be
productive of exchangeable commodities, even against those of foreign
produce.
Three millions of mechanics do not live more soberly, nor are they worse
clothed, than the husbandmen: it may therefore be inferred, that out
of the 20 millions, which they likewise receive for their labour, they
lay out in the produce of industry, 12 millions, which, added to the 44
millions I have just mentioned, make, all together, 56 millions.
The manufacturers and principal traders, under every denomination,
with their dependents of all kinds, complete the necessary number of
the supposed population of 9,350,000 inhabitants, that is, 1,100,000
souls, themselves, the idle people supported by them, and their
household included. Supposing their consumption of the rough produce
to be proportionable to that of the proprietor, their expenditure will
be 10,000,000; but then we must square by the same rule what they lay
out for the produce of industry: 18 millions will be the sum, which,
together with the other 56 millions, makes a mass of 74, instead of
the 70,000,000 acknowledged in agriculture. Even this would not be
sufficient, for reasons which I shall give in the sequel; but I shall
observe, in the first instance, that were the population less numerous
than we have supposed it to be, the same consumption of the rough produce
is certainly inadmissible: but the landed revenue remaining the same,
though procured by a less number of hands, it would then become necessary
to estimate the amount of the labours of industry, effected by a number
of handicraftsmen, equal to that of the cultivators, from the ascertained
value of the latter’s productive labour.
I now return to the _deficit_ wanted for the security of a constant
increase of wealth, which may at all times supply all the exigencies of
the State.
The 18,000,000 consumed on the produce of industry, as granted to the
principal traders, seem to raise them to 4,000,000 above their real
value; I mean, that which is acknowledged in the produce of agriculture.
It is not under colour of the supposed interest of the enormous
principal, which gives motion to the manufactures and to the inland
trade; it is necessary that industry should contribute its stock, as
well as agriculture. The principals laid out, by the one or the other,
are a matter of indifference to the state; it can speculate but on their
produce, and pays exactly the interests, when it rates at the same value
the result of the labours of both; but, to the 70 millions assigned as
the indisputable produce of industry, (supposing a laborious man to be as
good as any other equally industrious) we must add the intrinsic value
of the rough materials on which industry hath wrought: This accession,
which is also fair and equitable, will furnish, not only the 4,000,000,
which annually exceed the home consumption just mentioned, but likewise
all the millions necessary to secure, and mean while explain, this
gradual increase, which it would be difficult not to trace in trade, as
it is observable in the landed property. The latter is doubled within the
space of 90 years; from whence we are forced to conclude, that the annual
savings of the farmers, and owners living on the spot and cultivating
their estates on the true principles of husbandry, have sufficed to
discharge, not only the public burdens, and to defray the manuring
expences, but also to double the produce and the general means in the
most important article. It remains now to examine, whether the savings
of the manufacturers, traders, and other supporters of industry, are as
indisputable as those made by the cultivators.
_Clear Savings of the Manufactories, Trade, and other Branches of
Industry._
The riches of a country, and its progress, are established and
confirmed by its savings. Let us consider cursorily such as, from their
self-evidence, admit of no dispute.
Ninety years ago the landed revenue of _Great-Britain_ was computed at
about 35 millions. Let us suppose that 10 millions of specie were then
required to give an effectual circulation to property of all kinds,
(many people will think this by far too little[1]): but the revenue of
landed estates, being now 70 millions, 20 millions at least, instead of
the 10 millions requisite in the times of _William_ and _Mary_, should
be allowed; and consequently a first clear stock of savings amounts
to—10,000,000_l._
The consumer in those days was probably allowed, as is still the custom,
a twelve-month’s credit upon half the articles purchased. Some of them
took a longer time, if others a shorter one; but the stock of credit
being then equal only to 35 millions, and now raised to 70 millions, we
have clearly another mass of savings of—35,000,000.
Then, as in the present time, the preparing, manufacturing, and
delivering, required six, twelve, or eighteen months. Let us suppose the
year, upon an average of the slowness of one operation, and the celerity
with which another was performed, we shall find again, in the difference
of the flock, a third saving of 35,000,000.
If we suppose the value of manufactories, dwellings, warehouses, and all
kinds of establishments, necessary to answer all the exigencies of a
stock of industry and commerce of 35,000,000, to have amounted then to
25,000,000, we must admit that the objects in the same manner necessary
to a stock of 70,000,000, do likewise present us with a fourth clear
saving of—25,000,000.
In order to employ those hands by whose labour the annual sum of
35,000,000 was produced, 10,000,000 were probably sufficient;
whereas 20,000,000 are now required. This shews a fifth clear saving
of—10,000,000.
The annual returns from the _American_ islands was computed, 90 years
ago, at about 330,000, (Sir _Charles Whitworth_’s State of Trade). Half
of this produce was, in all likelihood, mortgaged to commerce; but it
only supposed a stock of 3,000,000 at most lent, it matters not at
what interest. The yearly produce of those colonies, added to that of
the ceded islands, amounts, at present, to more than 2,900,000; more
than one-third of which belongs to the trader, either as purchaser or
mortgagee, and exhibits a sum of about 20,000,000, from which we shall
substract the former 3,000,000; and considering (for a moment) those
colonies as being foreign to the State, we shall find a sixth clear
saving of—17,000,000, (the petition of the merchants in 1775, supposes it
to be 30,000,000.)
The _English_ might perhaps be out of humour with me, were I to suppose
that the continent of _America_, stands on the debtor side, for no more
than 4,000,000; I shall therefore set down this article as—_Memorandum_.
Eighty years ago the amount of exportation from _England_, was estimated
at 5,612,085_l._ In 1773, upon a medium of three years, the same was
increased to 16,027,937: of the exceeding 9 or 10 millions, one part
appropriated to the commerce in _Europe_, another to the _American_, a
third to the _East-India_ trade, remain one, two, and sometimes three
years, before they can be applied to the same objects. These 10,000,000
therefore suppose a stock more than double the same sum, and ought, in
consequence, to be set down as a seventh clear saving of—10,000,000.
The _English_ ships, employed eighty years ago in carrying on the
national trade, presented only a sum of 289,318 tons burden; the number
of tons is now rated at 775,078. This increase of 485,760, together with
the expence attending the fitting out, going and coming, produce a stock
of 5,000,000, which must be doubled, by compensating the voyages of
six and eight months, by those which require two or three years: here,
therefore, appears an eighth clear saving of—10,000,000.
The proprietor of lands should not be considered in this light, in the
use he makes of his yearly profits, but with respect to that part of his
said profits which he lays out in cultivation: In regard to that share of
his income which he invests in the funds, we must consider him as member,
agent, and usufructuary of industry and commerce. Now, if we divide
into three parts the whole of the national debt, one-third of which, if
agreeable, we shall set down as foreign property, and the other two as
belonging to the natives, we must of course acknowledge in the nation a
new sum of clear savings, amounting to 180,000,000. This, in fact, should
not be considered as a real increase of wealth, which it is at all times
easy to appreciate, but as a proof that there exists, in the nation, an
inestimable number of men, who are capable, in the space of ninety years,
to effect a saving of 180,000,000, which government will have it in its
power, within the same space of time, to appropriate to the exigencies
of war, if potentates should continue in a warlike humour; or to lay out
in objects of industry and cultivation, supposing an improvement of the
revenue should be preferred to a state of warfare.
I shall not speak either of the difference which may be observed between
the present state of the Royal navy, and the situation it was in at
the beginning of this century, nor of the public monuments erected
from that period, nor of the _India_ territories, nor of the Colonies
remaining to _England_; provided the objection concerning the money due
to foreigners is not repeated against me, as I am in hopes, by and by, to
find some kind of compensation for it. I shall therefore confine myself
here, to observe, that the above savings of all kinds of industry, some
of them active, the others passive, all equally necessary, assisting
each other mutually, no doubt, and finally amounting to 332 millions,
have been effected in the course of 90 years; not with any sensible
detriment to the landed property, since its revenue is doubled, nor to
the disadvantage of the lower class of people, whose day-work brings in
1_s._ 4_d._ instead of 8_d._ nor to the prejudice of the fine arts, the
rewards of which are perhaps fourfold, comparatively speaking; but solely
according to the common course of things, _restrained, nevertheless, by
a war of 30 years and upwards, out of the 90_, and by all the prejudices
which the present generation begins to shake off, and which probably will
be entirely abolished in the next.
It is no ways natural that the same causes will not be productive of the
same effects. It may therefore, in my judgement, be reasonably concluded,
that, within 90 years from this day, the landed revenue may be increased
to double its actual value, and the population, trade, and industry,
augmented in the like proportion, were even the national debt to amount
then to 476,000,000, instead of the present 238,000,000, which excites so
many complaints and loud murmurings.
In fact, let us suppose the debt arrived at a height so apparently
formidable, _and the price of every thing proportionably increased_;
would the former be less firmly established? Methinks that the very
contrary is demonstrated by calculation, and that imagination cannot
frame any rational objection thereto; at least I am free to confess,
that all my efforts have not been able to produce any combination of
probable circumstances, which might, in any supposition, justify the
dread of that _application of the sponge_ which is so often held out
as a resource that sooner or later must be adopted. Setting aside the
infamy of such a measure, what advantage would accrue from it? Let it
be adopted this moment in _London_, within three days the same step
must inevitably be taken at _Paris_. A manœuvre of this kind would
manifestly indicate either the most hostile intentions on the part of the
_English_ government, or the project of overturning the constitution: the
latter concerns _England_ alone; but in the former, _France_ is deeply
interested. That power would be compelled to put itself in a situation to
oppose an immense and free revenue, to a revenue equally immense without
appropriation. Were, on the other hand, the _French_ to lead the way,
_England_ must inevitably follow; and the unprofitable disgrace would
be the portion of either of the two nations that should have set up the
precedent.
But who will see without grief, 2,000,000 interest due to foreign States!
2,000,000 in specie carried out every year from _England_! _England_
yearly stript of 2,000,000 of her money!!! It will be seen hereafter
in what that money consists. Yet with personal stocks so real, so
considerable, so clear, what can prevent _Great Britain_ wresting from
the foreigner, the share he claims in the national debt? The reason is
obvious: the owner of landed property, or the farmer, who hopes to get
six _per cent._ of the stock which he lays out upon his lands, instead of
vesting them in the funds, envies not the foreigner who is glad to get
5, 4, or even 3 _per cent._ On the other hand, the merchant who trades
by commission, and who has an opportunity of placing in the colonies
his money at 5 _per cent._ interest, which is raised to 8 and 9 by
his commissions for sale and purchase procured therewith, cannot wish
himself in the situation of a stranger, whose stock in the _English_
funds brings him in, not above one half of that sum. It is still less an
object of envy for the manufacturers, or owners of ships, who, from their
manufactories or shipping, clear 10 or 12 _per cent._ of the monies laid
out by them: the projectors of all kinds likewise flatter themselves,
that the stock employed in their undertakings will produce 15 _per cent._
To sum up the whole in much fewer words, the prospect of 3 or 4 _per
cent._ is not likely to tempt any one, who is in hopes of getting a two,
three, or even four-fold interest. And in fine, the public funds, in any
country whatever, will never be more or less than a lucky, _or rather a
providential_, resource for those who have neither talent, power, nor
leisure, to place their money to better advantage.
Now, would the abolishing of such a resource turn to the profit of the
State, even supposing it to be effected by the justifiable means of a
general reimbursement, were the case possible? I have too often reflected
on the subject, too often revolved it over and over, I have viewed it
under too many points, not to be sensible how far above my strength it
is to discuss the matter in all its parts; I shall nevertheless venture
to throw out some thoughts, which to me seem likely to render somewhat
problematical a question which, at first sight, does not appear anyways
difficult to resolve.
This question is not, whether it would be more advantageous to the
State, not to have contracted a debt of 238 millions; but whether, since
it is incurred, it would be profitable to discharge it. To doubt of
the former, would be absurd: 238 millions thrown away almost entirely,
within the space of 90 years, to forward destructive schemes, now no
otherwise compensated than by a double devastation of the same kind,
in a neighbouring kingdom, which by a treble population was able to
support it, would certainly have been better bestowed, in both countries,
either on the lands, whose revenues and number of cultivators would have
increased, or in the improvement of the trade and arts, the stock and
_chef-d’œuvres_ of which would thus have been multiplied. But the debt
being once incurred, let us suppose that the 238 millions, which are
vanished, should return into the Exchequer, would it be proper or not to
pay it off? Thus stands the question.
_Thoughts on Imposts and Reimbursements.—The Accumulation of public
Treasure considered as the Means of preventing Taxation._
The present impost in England, as the case is almost every where,
consists of two parts widely different from each other: the one is
certainly burdensome, but necessary;—of this hereafter. Might not the
other, which concerns the national debt, however grievous it may appear,
be considered as an useful establishment, so long as it shall be presumed
that the increase of the national wealth, and its being divided amongst
a greater number of individuals, is an advantage to the State; “or, in
other words, until it shall appear evidently, that the welfare of the
State requires that each of its members should lay out annually all that
he is able to spend?” Before I attempt to deliver my opinion on these two
subjects, I shall suppose the reimbursement possible, and resolved upon.
Nine millions of taxes, to pay off the annual interest of the debt,
compose nearly one seventh of the landed revenue. These taxes, gradually
laid on such objects of consumption as are supposed most likely to bear
them, must have raised their price by one seventh, or something more; and
that really, justly, and I think necessarily. The reader will perceive
that I speak of the objects of taxation collectively, since some of them
bring to the Exchequer twice their intrinsic value. The reimbursement
being effected, would they fall back to their primitive value?—Yet this
must be, in order to reap the pretended advantage; and this, in my
opinion, would be of no manner of service. I shall endeavour to prove
it; and then we shall examine whether the effect would not be more than
doubtful.
It would be no easy matter to assign, for certain general facts, any
other cause than the force of Nature; who, in the end, gets the better
of all the regulations that thwart her. But let any one examine whether
there be a single untaxed object, which, from 90 years back, or, to speak
more to the purpose, from the origin of the national debt, is not raised
more than one seventh, above the nominal value it had at that period.
It is therefore sufficiently probable that the taxes have been felt, not
only by the consumer of the taxed commodities, (according to the laudable
intentions of Government) but also by the whole nation, by all the
individuals that compose it:—And this, in my opinion, is equally just and
unexceptionable.
Yet, it may be urged, that this increase in price is to be ascribed to
the greater quantity of specie in circulation. Granted. In this case, a
falling-off in the prices, accruing, as it is supposed, from a decrease
in the taxes, which is represented as the effect of a reimbursement,
cannot then take place:—besides, as the sequel will show, the taxes
unavoidably bring in, one way or the other, even in the first year, the
whole money required to pay the same. I shall argue on both suppositions.
Is the increase in the prices owing to the taxation? It appears,
evidently, that the taxes bring in the sums necessary to pay them, since
they are actually and annually paid:—This money, then, must be withdrawn
from the circulation, in order to lower the prices. Is this increase the
effect of an augmentation of the specie? Then it will be necessary, in
order to ascertain the primitive price, to recall from the circulation
all the money which has been introduced since, and in spite of the taxes.
Now if, in spite of the taxes, a country abounds with money, how should
it not be so, supposing no duties had been laid?—How can the abolition
of the taxes prevent the introduction of cash?—How will it come to
pass, that the mass of specie being increased, the prices shall not be
raised?—And if all of them augment, in a fair proportion, who will gain
by it, who will suffer?
Be it supposed, nevertheless, for this is my main object, that the
abolition of the taxes will lower the price of the mass of taxed
commodities.—The same force of nature, which, without the intervention
of any one, had raised the generality of untaxed objects up to the rate
necessary to balance the imaginary value, which the tax added to the
others, would operate in a contrary sense, and diminish, insensibly, the
price of those articles which might have been overlooked:—What would be
the advantage accruing to the State from a general and proportionable
decrease?—Let us not think yet of the pretended profit that would result
therefrom, in favour of trade, with relation to foreign competition: this
matter requires a particular article. The only business now in hand,
is to examine, whether, in case the reimbursement should be effected,
this general decrease of prices, which I have just granted, could be
effectually obtained.
The reflections which I have hitherto laid before the reader, suppose
that the refunded 238 millions would irrevocably be transferred from the
Exchequer into the hands of those unfortunate individuals who might have
been forced to receive their reimbursement. But one must live. Government
could not carry injustice so far as to compel them to bury, or cast into
the deep, that precious metal, ripped up at so great an expence from the
bowels of the earth. What consequence would then ensue, if that immense
sum put into circulation, not in _England_ alone, where such an addition
of specie would, in less than six months, occasion a six-fold rise of
prices, but over all _Europe_, where probably treble that stock never
was in circulation?—The price of every commodity would treble, or at
best double, perhaps universally.—What advantage could the State, or
individuals, derive from such unavoidable, general, and proportionable
rise?—Were the reimbursement practicable, instead of effecting it, I
should vote for laying out the 238 millions in erecting a colossus of
gold and silver, to be a standing monument of public gratitude towards
those whose œconomy and confidence have served the State in its needful
circumstances.
The absurdity which might be imputed to such an idea I shall partly do
away, by stating the effects of laying up treasures, as has been the
fancy of several princes, and which is supposed profitable by Mr. _David
Hume_, who, methinks, ought to have been one of the first to rest assured
of its inutility, after his excellent observations on money.
I shall suppose that the _English_ government had preserved, seven years
ago, the 60 millions and upwards, expended during the last war; and that,
instead of laying those taxes so highly complained of, they had annually
laid out of the Exchequer, the 12, 15, 20,000,000 sterling, which
successively produced the last debt: what might have been the result?
First, If the very useless prohibition of the exportation of specie,
however it _might_ be profitable to those who could export it, could
have possibly been put in force, 60 millions of real cash added, in
a country where 20 millions perhaps are sufficient for circulation,
must have doubled at least the price of every thing; a consequence
diametrically opposite to what it was intended to effect. Would it not,
in some respect, have ruined the Bank, by rendering useless its nominal
stock, in lowering the interest of its real one, and reducing, in fine,
its abilities so much below the level of public wants, when the general
prices, two-fold increased, would have raised, in the same proportion,
that of every engagement?
Secondly, The evil would have been less fatal than I describe it, if the
prohibitory law, as all those that militate against justice and common
sense, had been evaded; but the gold hoarded up heretofore, and now
supposed to be circulated over _England_, would, by succession, have
passed into _France_: and the latter, in order to continue the war, would
have borrowed, even of the _English_, at four, and presently at three
_per cent._ the monies which she could not procure at less than seven or
eight _per cent._ Now money growing more common in _France_, the prices
would be, as in _England_, and soon after every where else, increased
in the same proportion; for it is essential to observe, that those two
nations are too rich, their correspondence too extensive, their activity
kept up by too many branches of industry, for them not to regulate
the markets all over _Europe_: it is probable that both are now too
enlightened any longer to refuse receiving it, not one from the other,
but from Nature herself, who, constantly provident, ever above the reach
of untoward regulation, at all times unbiassed in bestowing her favours,
or equipoising one by the other, would settle, only a little later,
notwithstanding all efforts to the contrary, that equilibrium necessary
to the general good of Society, of which it is glorious enough for those
two countries to constitute the preponderant parts.
Thirdly, Independent of this general and inevitable repartition of the 60
millions laid up heretofore, the 10, 15, and 20 millions, which _England_
has found yearly, during the last war, in the purse of her subjects,
were, beyond doubt, that portion of capitals, which the circumstances
of such a war as the last was, would have rendered useless in the hands
of the lenders, had government found in the Exchequer those sums which
were obtained by way of a loan. Can it be doubted but that this portion,
useless in _England_, in the supposition of a prior accumulation of
money, would equally have been sent into _France_, on the first prospect
of placing it to advantage?—It would have been carried there, just
as the _Dutch_ had formerly sent into _England_ the dormant part of
their capitals, and would send it any where, at all times when sure
of benefiting by it, were it even against the interest of the _United
Provinces_, saying with _Camilla_, in _Corneille_’s Tragedy of the
_Horatii_,
“Rome, si tu te plains que c’est-là te trahir,
“Fais toi des ennemis que je puisse haïr.”
It will appear by the sequel, that I am as far from cutting off such
resources, as are deemed infallible, and dictated by prudence, in order
to support with vigour a necessary war, as I am from raising the least
doubt concerning the right of waging war, be it ever so unprofitable
and unjust. My only intention was to prove, that treasures hoarded up
in time of peace, and scattered afterwards during a war, in order to
avoid taxation, would raise much higher the prices of everything, than
taxes of any kind whatever could raise them. And I do now say—make war
as long as you please, but do not accumulate for the purpose of waging
it. Your monies, locked up in your strong chests, could not be sheltered
from every kind of accidents; and whilst you can boast of subjects
equally brave and industrious, you will never want money, nor means to
carry on any war you may undertake: but then you must submit to that
augmentation of prices, which must naturally follow. I flatter myself I
shall be able to prove, that this very increase is subject to no manner
of inconvenience.
_On the grievous, but necessary part of the Impost._
Which part of the impost is truly hurtful to the wealth of nations?
A standing army of 50,000 men in time of peace, both for the sea and
land-service, and 50,000 more employed, either upon the different
objects relating to those services, or to maintain good order and public
tranquillity, or intrusted with the collection of the revenue, are
evidently 100,000 men, taken in _England_ from that last class which,
though _last_ in point of rank, is nevertheless the sole instrument of
the national riches. Now, out of the _given_ number of 9 millions of
inhabitants, 6 millions only constitute this precious, this productive
class; the other 3 millions consist merely of consumers: from the 6
millions, allowed in the productive class, deduct 4 millions of children,
old people, and women, half of whose life is taken up with the cares
and incumbrances of a domestic nature; of this truly profitable class
3 millions only will then remain. A hundred thousand men, all stout,
vigorous and skilful, constantly withdrawn from that class, occasion a
vacuum of about a twentieth in the productions of the land, and of the
arts, that is to say, (for there should be no illusion in the case) the
twentieth part of the possible wealth. That portion of the impost, which
is set apart for the subsistence of those 100,000 men, is therefore, in
some manner, burdensome; since society is thus deprived, not only of
the produce of their industry, but also of that part of other people’s
labour which they consume without contributing towards it: but amends
are amply made for those indispensable privations, by the property being
better secured, and enjoyed in full tranquillity. Besides, that part of
Society, which suffers most thereby, does not belong to the productive
class; the latter, as has been already observed, is, in the richest as
well as in the poorest countries, ever reduced to that pittance which
is but just necessary to keep up industry. Nations the most free differ
in this point from those who groan under the most slavish despotism,
only by the insolence with which this scanty pittance, if refused, is
insisted upon in a free country, and the humble manner in which it is
sued for in the others. The difference of natural talents, displayed in
their utmost energy, suffices to establish, sooner or later, amongst the
freest people, that enormous disproportion of wealth which gives offence
elsewhere, only because it is not always the proof or reward of labour,
abilities, and œconomy.
Let any circumstance whatever, either well or ill judged, occur, which
may determine the nation to complete to 200,000 the 50,000 sailors and
landsmen that are sufficient in time of peace; 150,000 more men will be
taken from the productive class, which must, of course, occasion a second
vacuum, viz. the productions with which they would have enriched or
amused their country. But the loss will not end here; other 300,000 men,
many more perhaps, from the same class, constantly busy, during the war,
in preparing the intended destructive plans, will unavoidably occasion
a farther loss of four or five other twentieths in the other enjoyments
of peaceable times, to which, had not other occupations interfered,
they would have contributed: and if the war should last for 3, 4, or 10
years, it is evident that, in the latter supposition, the nation must
lose all that increase of wealth which would have been effected, had the
principal, swallowed up by the war, been differently employed. This loss
is considerable, immense, and never can be retrieved; for what was then
omitted, will never be done; what will be effected, might equally have
been so, without preventing the productions which would already have
taken place.
All these _deficits_ in wealth, occasioned by the war, are a substantial
loss; and the prospect would be dispiriting indeed, were not the
rival nation in the very same predicament. But will this grievous
loss be after the peace active, as it were, and felt by the community
longer than the time required for the 2, 3, or 400,000 men, employed
during the war in forwarding the destructive schemes, to resume their
peaceable occupations; or till the number of them, who shall have died
in _America_, the _Indies_, of the scurvy, or at the fatal tree, be
replaced by the ordinary course of population?—This I cannot conceive by
any means: some of the reasons, which I have to adduce, will be found
in the reflections I am about to present on the second part of the
impost, which seems to me not less useful than the first is necessary:
all my other arguments will appear in the other parts of this work.
If it can be concluded from the _ensemble_, that all the evils brought
about by a bad or ill-fated administration, are naturally, and without
expence, compensated under a wise ministry, and that the most barbarous
and most extravagant of them all could have no other means of ruining
the nation than by destroying the people; then, made easy on the effects
of the national debt, we shall have courage enough to acknowledge,
that it is as sacred in the hands of those, who, having furnished the
value, are in possession of the vouchers, as the crown on the head of
the monarch; and we shall enjoy the freedom of mind necessary to infer,
that although Providence often seems to leave to chance the destiny of
some individuals, yet it is very far from being indifferent to all that
concerns the whole species[2].
_Of that part of the Impost, which is more useful than grievous._
The part of taxation, which now remains to be considered, is that which,
at every instant, presents to any one, a secure and useful employ of all
the capitals at his disposal, and of all the savings which prudence hath
induced him to make. The utility of the public funds, which are nothing
else but the national debt, might seem established by these few words;
but further details are necessary.
I have adopted the estimate by which _England_ is supposed to contain
9,300,000 inhabitants; one-third cultivates the land, one-third is
engaged in manufactures, and of the remaining third, 600,000 at most
share among them the neat produce of cultivation and the arts, in
proportion to the capitals with which they keep in play those two engines
of opulence. All the remaining part of the people, as dependents under
whatever denomination, look, for their subsistence, to the friendship,
humour, pride, or wants of the 600,000 proprietors.
Out of 70 millions, at which the landed revenue throughout _Great
Britain_ is computed, 33 millions are absorbed by the unavoidable
expences, and accessary charges attending cultivation, or annexed to the
property. The proprietors share among themselves 20 or 25 millions; the
other 12 millions go through the hands of farmers, as a very equitable
recompence for their trouble, and as a liberal interest for a personal
stock of 120 millions necessary to the produce of the revenue. (Vide Mr.
_Arthur Young_.) On the best use possible of these last 120 millions,
solely depends the increase of landed profits: but it is only by degrees,
and the concurrence of favourable circumstances, that the landed property
can effectually receive the increase of the capital, which is calculated
to augment that produce.—Does it conduce to the interest of the State,
that, till then, the farmer should keep inactive the capital appropriated
to so material an object, or that he should lay it out to improve the
lands before it is wanted, or that, waiting for the instant of need, he
should employ it in such manner as not to have it at command when the
needful time is arrived?—This question cannot be answered, I think, but
in the negative; and it appears to me, that, on this point at least, I
may assert positively, that an establishment, which puts into the hands
of the farmer, at the very juncture when he wants it, that portion of
his capital which had hitherto been useless, _and which however was,
till then, (owing to such an establishment) advantageous to some one
else_, is, of all others, the most profitable, wherever the object is,
to give to every capital that degree of activity and utility of which
it is susceptible. Therefore, a reimbursement which would deprive the
_capitalists_, farmers, and active proprietors, of a resource equally
safe and profitable, would not only prove fatal to the order of citizens
especially interested in the landed revenue, but to all those who, whilst
the money intended for the improvement of land, is unapplied, make use of
it in some advantageous speculation, which becomes important to the arts,
and to commerce.
We have already observed, that out of the three last millions of
inhabitants, 600,000 _capitalists_ only share among themselves the
neat profits of the arts, and of cultivation. There remain therefore
2 millions 400,000 dependents, who look up, for their subsistence, to
the caprice, the pride, or wants of those opulent men. Now out of that
number of dependents under every denomination, servants, clerks, lawyers,
physicians, &c. several thousands are to be reckoned, who, tired of
their situation, put by constantly, part of the wages of servitude, in
order to secure to themselves and their posterity a more free and less
equivocal existence.—Would the State be benefited, were this class of
men, as essential as any other parts of society, to bury, as it were, the
surplus of their layings-out, till they should have amassed the sum they
might think sufficient for their intended purpose?—Would not the money,
thus lying idle, occasion a chasm in circulation, which would turn to the
prejudice of trade, thereby deprived of part of its resources?—Besides,
if the want of a chest, safe from the attempt of robbers, and other
inconveniences, a chest which is not only a security for them, but
affords an interest for the money therein deposited, should necessitate
them prematurely to embark in some scheme foreign to their occupation,
which must be either abandoned or neglected: would not that knowledge,
which they have derived from experience in all matters relating to their
primitive avocation, be entirely lost to the public?—A reimbursement
therefore which would deprive that part of society, much more wretched
and dependent than either the mechanic or the cultivator, of a resource
which, from its certainty, induces the former to fulfill with more zeal
and exactness, the duties they have imposed on themselves, would prove a
measure as hostile to humanity, as it would be contrary to sound policy.
In the immensity of commercial operations, how many capitals to a
considerable amount, unemployed during two, three, four, and six months,
are indispensably wanted at the precise period! Would it turn out to
the advantage of the State, if a considerable capital, useless for six
months to the holders, and for the like space of time essentially wanted
by those who possess none, should lie dormant in the proprietor’s chest,
till time should give it life, and make it useful?
But it may be urged, a man buying stock in the public funds, would lend
to the seller (were no such funds established) the sum which he gives
for his purchase.—That he might do so, there is not the least doubt: But
could he depend on receiving the money at the time appointed for the
repayment? May not the best man to-day, be a bankrupt to-morrow, and
break for a million; and if the enterprise, to the execution of which
a merchant appropriates, to be paid in six months, that portion of his
capital, which till then has been to him unprofitable, should require
that punctuality which alone could insure its success, will not prudence
compel him to give up six months interest, that his undertaking may not
be left entirely to chance?—Will not the public have lost the fruit which
might have been reaped from that dormant capital, had the owner been at
liberty to dispose of it?—And, will the same public flatter themselves
that the six months interest which the merchant was obliged to sacrifice,
in order to secure the execution of his plan, will not be reckoned in the
expenditure?
Some will say, with no small degree of acrimony, “How many drones
are supported at the expence of the public funds! These are only an
encouragement to idleness.”
But do the persons before spoken of, come within this description? And,
if the man who has laboured in his youth, chooses to repose himself
in his old-age, is this pretended idleness any thing more than that
_otium_, that leisure, so justifiable, and so sweet, after a toilsome
life, when the state of the mind, and of the heart, cease to make labour
necessary?—And, supposing, that after his death his wealth devolves to an
ideot, must the son of an industrious father, who has served the State
both by his œconomy and labour, be deprived of his resource?
It might be objected, that my reasoning derives its force from the bare
supposition of a total reimbursement, the possibility of which no one can
admit; but were it subjoined, that, by acknowledging the impracticability
of the measure, we suppose its expediency;—were it farther said,
that the public papers have often spoken of, and do still point out
as the readiest and surest way to effect it, _the application of the
sponge_;—were it added, that the first geniuses of _England_, _France_,
nay, of all _Europe_, have advanced, and do still maintain, that such
a measure will one day or other become unavoidable;—then we should be
forced to acknowledge, that it would be no inconsiderable service to
humanity, to spare no endeavours to convince the people, that no greater
ease, power, or happiness, would accrue to them, were the nation to
resolve upon its own disgrace.
Nor would it, in my opinion, be a more difficult talk to prove, that from
a real and gradual reimbursement, no other advantage could result, than
bringing about by degrees and more imperceptibly, an evil which would
prove equally unprofitable to all.
I set aside the outcry against the interest yearly paid to foreigners,
as the produce of the sums vested by them in the funds, because I think
ruin impossible, where the money borrowed at 4 or 5, is laid out at
an interest of 6, 7, or even 10 _per cent._ I likewise overlook the
declamatory complaints on the fate of the handicraft and husbandman;
because the laws of _Lycurgus_ should be revived, or the government must
confine itself to protect those two classes of men against every sort
of private vexation, and to secure to them the trifling salary to which
they are every where and forever doomed. In spite of avarice the salary
must be raised, if the prices of every necessary should increase; and
were these to fall in their value, mutiny itself could not prevent a
diminution of wages.
That part of the people which truly deserves, and should engage the
attention of government, is that crowd of dependents, in the other class,
of which I have already spoken: like the cultivator and artificer, they
have no other stock than the passions and wants of the _capitalists_.
These would be much more wretched than the others, if the education
they have received, carrying their thoughts constantly and in spite of
themselves beyond the present moment, government should in a manner
compel them to center them all within that narrow space. The merchant
never has more in the funds than that portion of his capital, which, for
the moment, is useless to his trade. The farmer, and the proprietor who
manages his own estate, _considered under these two heads_, have at no
time in the funds more than that portion of their capitals, the actual
use of which upon the lands they cultivate, might turn rather to their
prejudice than profit. The annihilating of the public funds, or, in other
words, a partial reimbursement, a gradual discharge of the debt, could
therefore affect those three orders of stockholders no farther than to
deprive them of this way of increasing their capitals, without running
any risk; and those are, undoubtedly, the smallest part of the sums which
constitute the national debt. Which is, then, the order of citizens that
receives the larger share of the interest funded for that debt? It is
that multitude of dependents whom the political œconomy of society has
doomed to toilsome occupations useful to that society, or to laborious
studies, of which that very society daily reaps the benefit: it is to
that multitude of widows and orphans of both sexes, whose future support
the unfortunate class above-mentioned thought to have secured by means
of the present privations which they had imposed on themselves: it is to
those children whose elder brothers are in possession of all the family
real estate, and whose parents hoped to have fixed their condition and
settled their fortune by the only means that can effectually obviate,
not the injustice of an unequal division, since it is admitted, but the
inconvenience resulting from the indivisibility of the landed property,
which devolves to the eldest.
Yet if, in a State, we must be father, brother, sister, widow, orphan,
_capitalist_, in fine, or without a capital, but with the faculty of
acquiring one; which, then, is the class of citizens interested in paying
off, either totally, or in part and by degrees, the national debt, when
once it is incurred? Besides, if the reimbursement cannot be effected but
at the public expence, what advantage will the public derive from this
operation?
_Objections of another kind against paying off the National Debt._
The nominal amount of a loan which nothing obliges us to repay, is a
matter of a very little importance; the interest agreed upon for the
borrowed sum, is the only thing that deserves attention. The total of
the interest in _England_ is now about nine millions, three millions of
which could not be procured but by laying taxes on those objects which
had hitherto escaped the penetrating eye of the financiers, and by
doubling or trebling the impost on those which appeared less liable to
the inconveniences attending such an additional increase.
Before I examine in what mode the taxes operate, I shall suppose, for the
satisfaction of the sensible and benevolent mind, that this formidable
burden falls only on the consumer of such objects as are taxed. The only
plausible aim of a reimbursement, is a diminution of the taxes which lie
so heavy on that consumer; but the misfortune is, that the only means of
refunding, is to devise new taxes, or increase the former ones. Besides,
if this increase be trifling, the reimbursement cannot be effected in
less than a century. I freely confess, that in this case, the proprietors
of the public funds would be less aggrieved, having then sufficient time
to think on the less disadvantageous modes of replacing their stock; yet,
I repeat it, not less than a century would suffice to discharge that
very debt; and the public being a little more burdened annually, than
they would have been had not the project of paying off the debt been
started, would have no other compensation for the additional burden, than
the distant prospect of a general release in a hundred years.—If the
intention is, to bring about that release within a period which, to the
fiftieth part of the present generation, gives the hope of enjoying the
effect of it, I agree, that by means of one million of additional taxes,
and some financiering tricks, the whole debt may be liquidated within the
space of 40 or 50 years; and then, that part of the present generation
which may exist at that _most gracious_ period, will, perhaps, bless the
hand by which it shall have been relieved. But would that same hand be,
till then, entitled to the like blessings from the unfortunate who should
be reimbursed, and from those at whose expence this operation would be
effected?
A first difficulty attending the objects under examination, is, that on
every head requiring an explanation, a multitude of questions occur,
which must be previously discussed; yet, with the utmost candour I
confess, that there is not one among them which is not above the extent
of my abilities. I shall therefore offer my thoughts on the subject with
all that diffidence which results from such a consciousness. Partly by
chance, partly from some other circumstance, as little glorious almost,
or as little humiliating, I have been so often in the right, and so often
in the wrong, that I should not be now more surprised at the one than
proud of the other.
Another inconvenience is, that a picture, which, in its _ensemble_,
might hold out, through a thousand incorrections and as many essential
defects, a grand subject which, to become generally interesting, seems
to wait only for the pencil of a skilful artist, viewed, unfortunately,
by pieces, (and indeed it cannot be viewed otherwise,) presents at each
time, nothing but a singularity, an oddity, which will cease to be so
only when brought near to another; and this last, nevertheless, will
require the same indulgence in order to its being rightly understood.
The picture which I have presumed to take in hand is, I think, nearly
of this kind. My wish, and a bold one it is, would be, that no judgement
be pronounced on any of the particular parts, till they have been seen
all together; for there are but few of them which, till another has been
examined, is not liable to very just objections: and under each head I
have answered to those only which it was essential to refute, that the
reader might be able to go through the whole of the exhibition, which,
had the plan of it been presented in the first page, might have subjected
the book to be committed to the flames without mercy, and, indeed,
without much apparent injustice.
I now resume my subject, after a digression that may be looked upon as a
preface, which the reader may perhaps think might have been spared.
In the age we live in, to justify a necessary impost, by the pretence
of paying off the debt, would be, of all state manœuvres, the most
unpardonable. To lay heavy burdens on the people now, so as to liberate
them in the space of a century, is, independent of a great many
more improbabilities, to suppose, in the plan of administration, an
immutability which it cannot give itself, and which does not, nor ever
can exist. To leave the individuals of a nation in possession of all,
that it is not indispensable to take away from them, in order that, with
what they have left, they may acquire that which it will be perhaps
necessary to deprive them of, is a principle, the absurdity of which
it would be no easy matter to evince; but, to crush them under such an
additional weight of taxes as would be necessary to exonerate them forty
or fifty years hence, would be, in my opinion, attempting a measure, some
of the consequences of which have no doubt escaped the attention of the
proposers.
What may be the immediate effect of a considerable reimbursement, which
even solely depends on the produce of taxation, and by no means of a
real increase of specie in the nation? It consists in refunding to the
lenders a sum which must cease to be useful to them, till it is replaced
somewhere else; and obliging them to vest it, without loss of time, on
that portion of the debt which is not yet acquitted.—But this privileged
portion, which, previous to the reimbursement, was supposed only worth
80, and produced four, (it may be observed that, in the numbers, which
I fix upon, I only look for terms to explain my meaning) will be worth
90, and presently 100, yet will not bring in more than _four_. It may
be answered, the stocks rise, public credit increases.—We are not yet
come to this point; but the fortune of the repaid stockholders, which
does not consist in a nominal capital, but in the revenue it produces,
will therefore, in fact, suffer a diminution of one whole fifth. What
will then become of that fifth of the taxed objects consumed by them, and
which they can no longer purchase?—It will, in my opinion, be necessary
either to put a stop to the manufacturing of that fifth, and throw so
many hands out of employment, or else lower the prices, yet continue to
levy the tax, and then the manufacturer will complain of the burden; or,
in fine, this fifth, now useless to the nation, must be exported, and
this adds to the first inconvenience resulting from the tax imposed for
the reimbursement: for, after all, if taxation operates in the manner
it appears at first sight to do, that is, if it diminishes the means
of consumption, then, by laying 1,000,000 of taxes appropriated to the
liquidation of the debt, you have diminished your home-consumption, it
matters not of what articles; you have diminished it, and still more
so by the incapacity, to which the creditors paid off are reduced, of
consuming that which they did consume previous to the reimbursement.
Your exportation, it may be said, is by so much more increased, and
enriched.—Granted;—but at whose expence? Who is to profit by it? In
what manner are the returns to be made?⸺When foreign trade augments
in proportion to the increase of the produce and home-consumption, it
is easily conceived, that if the money imported does not exceed the
proportion necessary to answer that double increase, the progression
being equal every way, each article (money among the rest) will keep up
to its value; but if the number of representatives is increased without
any addition being made to the objects represented, is not the price of
representation thereby diminished? Or, in other words, if you add to the
real stock of money in the nation, at the expence of part of your own
consumption, (which is the object in question) will not the price of the
other parts of that same consumption rise in spite of you?
Besides, by diminishing, in any quantity whatever, the general mass of
home-consumption, (and in the present supposition you may well think
that it has decreased, both by the tax imposed and the reimbursement
made) have the sums appropriated to that part of the consumption,
annihilated by you, been withdrawn from the circulation? If not, then
by adding thereto the increase of that balance in your favour, which
you pretend to receive from abroad, by what means can you prevent a
general rise in the prices, in proportion, not only to the quantity of
that fatal money imported, but also to that cash, which ought to have
been buried under ground, that it might, at least, only prove useless,
after the home-consumption has undergone the diminution occasioned by the
reimbursement and taxes? This is not all; the unfortunate creditors who
have been paid off, already reduced from five parts of what they enjoyed,
to four only, will certainly, soon after you shall have put the said
balance into circulation, become unable, with the _four_ that remain,
to purchase more articles than they could have procured with _three_,
previous to the tax and reimbursement.
Will you pretend to say, that this money does not circulate within
the nation? that it becomes the source of a new trade? and that the
exporters, instead of over-loading _England_ with that specie, send or
carry abroad the value thereof from _Spain_ into _France_, _Germany_, and
_Russia_?—that is to say, after having reduced the home-consumption, the
exporters, who, rightly enough, are not willing to lose, will contribute
to extend the internal consumption of _Spain_, _France_, _Germany_
and _Russia_, and of course _the ways and means_ of these different
nations, as well as the produce of their taxes, in the same proportion as
those objects have decreased amongst you.—Could this seriously be your
intention?
But if it clearly appear, that the execution of the refunding plan would
prove equally pernicious in its immediate tendency, both to the creditors
who would be compelled to accept of it, and those at whose expence it
must be effected, what then might be the case, if the interest of that
debt, which ingrosses so much the public attention, being paid by _all_,
were, in fact, paid by _no one_, but for so long a time as nature,
assisted by all the calculations of individuals, may require to correct
the errors of those upon a larger scale, _made by administration, when
administration is capable of making any_.
_In what manner the Interest of the National Debt will be probably paid
off._
It is the most generally received and best respected opinion, that taxes
should in preference be laid on the articles of luxury. There is not a
man possessed of the least feeling and honesty, who does not approve
of this maxim, and whose wish has not often been that the wealthy only
should pay the taxes. Canting enthusiasts further add, that the expence
and luxury of the rich, prove the ruin of the nation. Be it so. But when
the question is, to define what is luxury, in order to subject it to
a tax, every individual exclaims, that it begins precisely with those
articles which the mediocrity of his means, places above his reach.
Instead of laying a tax on beer, would it not be better to increase that
on hackney-coaches? says a porter who is stopped at a crossing, by one
of the above vehicles; whilst the supposed idler who sits in the coach,
and pays for it, exclaims, at the sight of a gilt carriage, that crosses
and stops his way: What! 500_l._ laid out on a single article of luxury!
Would it not be better to tax the owner by so much, and apply the produce
to the maintenance of fifty poor objects during six months? But, my dear
Sir, the manufacturing of this very carriage has maintained a far greater
number. If you begin with the man who extracted from the mine, that gold,
which, with indignation, you see glittering on the wheels; if it is not
beneath you to notice the child employed in driving away the flies that
might have hurt the gloss of the varnish when first laid on; and if
you end your list only with those who, instead of horses, dragged the
carriage into the coach-house of that stately man, whose pomp gives you
so much offence; would it have pleased you more if all those hands had
been paid for doing nothing? The rich man alone, say you, ought to pay
the taxes: but it is impossible that they should be paid by others, “_if
it be true, that every man, destitute of a capital, can pay nothing but
at the expence of the capitalist_.”
It would be a difficult matter to trace out, with exactness, the
progress of the taxes; but it appears to me, that whatever be the mode
of establishing them, there is not a subject who does not contribute his
share sooner or later, unless nature should annul the burden, even before
the clashing of private interests should have succeeded in settling the
division upon equitable principles.
The downfall of _England_ was foretold at her very first loan. This
prophecy did not destroy the means of funding, on a very solid basis,
in the year 1762, that part of the national debt, till then unfunded.
Now I would ask the man, whom I should know to be most intimately
persuaded of the dreadful effect that must be produced by a debt of
64,234,595_l._ incurred from 1754 to 1762, in addition to a still
heavier one, contracted since the time when the total amount of the
landed revenue was rated at 32,000,000, and the value of the lands only
at 320 millions, that is to say, at about double the value of the whole
national debt as it stands at present: I would ask that man, I say,
whether, between the years 1763 and 1775, he has been able to discover
in any parts of _England_, one single symptom of decay, either in
agriculture or commerce, any diminution of public or private enjoyments,
or less insolence amongst the common people, by which one may surely
judge of the alterations which may happen in their circumstances.
This general observation may suffice to make us look on the period of
1775, as presenting a state of things, which, supposing it had been
prolonged, could not have held out any alarming prospect. Every one
worked or enjoyed, and every body was paid. All this, methinks, might
have continued on the same footing to the end of the world, without any
alteration on the former or subsequent fortune of any one, such only
excepted, as industry, activity, imprudence, and foresight, must occasion
in all countries where justice is blind, and has but one scale.
I readily acknowledge, that at that period a grievous war broke out,
which did not conclude till 60 millions, nominally 100, had been added
to the old debt, or, to come more directly to the point, till the
nation had been loaded, or, if you please, crushed under the enormous
weight of three additional millions interest to be paid annually.
But in what manner will those three millions, so heavy, so dreadful,
affect the interested parties? In my judgement, it will be the same
with this additional burden, as it has been with the six millions which
the said parties were wont to pay before the last war. It certainly
must have been felt at first by every body, except the trading part
of the nation, whose first operation ever was to add to the price of
the taxed commodities, both the amount of the tax, and the benefit
of the advance to the consumer. (AND THIS IS STRICTLY CONSONANT WITH
JUSTICE.) Now these consumers are of two sorts, viz. the proprietor of
lands, and the proprietor of money: the latter must also be considered
under a two-fold point of view, as a capitalist for himself, or as a
dependant who receives the money from either of the two proprietors. The
proprietor of money, from the nature of this instrument of trade, is a
being merely passive; twenty shillings, which he is paid for interest,
can _currently_ enable him to purchase such articles only as _currently_
sell for 20 shillings. If the taxes had increased, by one tenth, the
price of all the commodities which he used to consume before the war of
1755, it is clear, therefore, that in 1763 he had lost one tenth of all
his _possible_ enjoyments: I say possible; for the monied man, I speak
in general, saves enough, annually, to strike an advantageous balance
against the inconveniences _inseparable_ from his capital; I mean that
progressive and unavoidable depreciation of money, so long as there will
be mines opened, and taxes to discharge. But he can effect it with the
greater ease, as his stock often returns 5 _per cent._ whilst the capital
of the landed proprietor brings him in hardly four, and often less.
The _dependent_ proprietor of money had also his resource; he, by
degrees, obtained an increase of salary; (AND THIS IS STRICTLY CONSONANT
WITH JUSTICE.)
Neither was the landed proprietor without his resource: he gradually
raised the price of his goods, and would have increased it to the level
of the whole amount of the produce of industry; (AND THIS WOULD HAVE
BEEN STRICTLY CONSONANT WITH JUSTICE.) But nature very often anticipates
the execution of that very equitable measure, by another operation which
is as infallibly the consequence of peace, as taxes are the effect of
war, ever since the abolishing of personal service. The 10, 15, 20
millions, which government had borrowed during the war, were nothing more
than a part of the capitals which in happier times might have been laid
out in the improvement of cultivation and industry. Peace brought them
back to their destination; an increase in the quantity of the produce
of lands was the consequence; and an equal increase in the demands of
the productions of industry, occasioned by the former, kept up the price
of every thing, _by facilitating to the one, the means of purchasing
what the other wanted to dispose of_, and by presenting an increase of
resources to that increase of population, which as certainly results from
peace and plenty, as mortality does from war and scarcity.
I now return to the three millions interest brought upon this nation
by the last war; and I demand, what reason can prevent similar effects
resulting from similar causes?
Yet, in order to obtain a complete idea of the whole burden of this
_formidable_ debt, we must suppose that the full amount of it was
contracted during the last war; and then we shall see how many millions
of guineas it would really cost _England_ to pay off for ever the
interest of all her successes and miscarriages from the beginning of this
century, if the 9 millions of taxes should be now established in order to
supply the interest of the debt of 238 millions.
It will appear hereafter, that 9 millions of taxes laid on the articles
of consumption, would increase, by about 14 millions, the price or
nominal value of the whole produce of industry, rated upon supposition
at 56 millions. Now it seems to me equally unjust and impossible, that
the total amount of the produce of agriculture should not thereby be
increased in the like proportion: I beg to be allowed this supposition,
until I assign my reasons for it, and bring proofs sufficiently positive
to ascertain the fact.
Be it supposed, then, that the collective revenue of land and industry do
amount to 112 millions, independent of the taxes.
Let us equally suppose that 40 millions sterling, in cash and paper
currency, would be necessary and sufficient for the circulation of the
said 112 millions.
Fourteen millions, in taxes, and in the advanced prices which must
follow, are one eighth of 112 millions revenue, which, by the necessary
rise in the price of every thing, is carried to 126 millions. Now, 5
millions in cash and paper currency, are likewise one eighth part of the
supposed 40 millions necessary for home circulation.—It would then cost
_England_ only 5 millions in cash and paper, once found, to secure for
ever, and in the most permanent manner, the interest of a debt of 238
millions, the very idea of which shook the firm nerves of the _Walpoles_,
the _Humes_, and of the many experienced men, on whose authority it was
no weakness to tremble, before investigating a matter, which nobody, in
my judgement, had hitherto attempted to examine.
All the operations of Nature are slow, gradual, imperceptible; and how is
it possible to trace her out in her progress, when, in the measures which
lead her to the general good, she has recourse only to that multitude of
private interests which seemingly tend to destroy it? Yet, in order that
we may form some idea of her operations in the point in question, let us
execute, in an instant, that which she would effect in half a century,
if it were possible within that space of time to incur a debt of 420
millions, without any augmentation or decrease taking place in the landed
revenue.
_First Hypothesis._
Let us suppose, that, instead of appropriating the capitals that have
disappeared, either to undertakings relative to agriculture and industry,
(which would have trebled the real revenue,) or to those wars, either
successful or grievous, that have left behind them only a frivolous or
bitter recollection—let us suppose, I say, that Government should have,
till this day, thought of nothing but making public establishments,
and that every contributor to the public expence, being permitted at
last to live up to the full rate of his means, should find the fruit of
his former privations, in a multitude of monuments, such as the most
luxuriant fancy can conceive, from the wisest disposal of the capitals,
and of the time necessary to incur a national debt, the interest of
which, added to the increase resulting from the taxes, should amount
to 32 millions, upon an aggregate revenue of 64 millions, in which
agriculture and industry should have an equal share. Such, nearly, was
the state of the nation, under _William_ and _Mary_, as we have already
observed.
The tax laid on the produce of industry would double the 32 millions:
this is just; nor can it be doubted; for there is not a manufacturer,
whose goods or produce have just been taxed, but will acknowledge this
truth. Besides, the _British_ Parliament avows it. What remains now,
is to convince the landed proprietors, that by doubling also their
32 millions revenue, they injure no one whatever. It is needless to
prove, that if they act otherwise, if they be only passive when the
manufacturers are so justly active, they must be reduced to plough those
lands that acknowledge them for their lords.
Previous to the tax, the 32 millions landed revenue, used to cost,
annually, to the landlord and farmer, 9 or 10 millions, paid to the
cultivators, and laid out in other expences. Such is the rate; nearly one
third of the revenue, (See _A. Young_’s Political Arithmetic.) Before the
tax, industry must have laid out amongst the handicraftsmen, nine or ten
of her 32 millions.
By doubling, therefore, the price of labour in agriculture and industry,
the labouring people of both, will, under the numbers 18 or 20, have what
they had before under those of 9 or 10; and these two great engines of
national wealth will no ways be clogged.
As for the two _capitalists_ in land and industry, it is clear that each
of them will have exactly the faculty of preparing, buying, selling,
consuming, and saving, under the denomination of 30, 40, 60, &c. all that
they could prepare, buy, sell, consume, and save, under that of 15, 20,
30, &c.
Before we attend to the lender, let us advert to the State; and let it be
observed, that _in the case where 20 millions of cash and paper currency
would have sufficed for the circulation and national transactions of all
kinds, at a time when both revenues amounted to 64 millions, it is enough
to find out 20 millions more, whenever, by the effect of taxation, those
said revenues are raised from 64 to 128 millions; and from the instant
that those 20 millions in cash and paper currency are obtained, you may
flatter yourselves to have established, ~funded~ most firmly and for
ever, the interest of a national debt of 420 millions, the interest of
which, would at 5 per cent. amount to 21 millions_.
It is not yet time to examine what influence so considerable a rise, in
the price of every thing, might have upon the foreign trade; but let
us turn our thoughts to the interest of the stockholder, who has so
generously lent his money. It will be said, that he is evidently injured:
_the interest due to him on account of his loan, was equal to two-thirds
of the landed revenue: the land is mortgaged to the creditors of the
state: two-thirds of the neat revenue belong therefore in fact to the
lender. A few years more, employed in erecting useful buildings, bridges,
causeways, &c. the whole landed revenue must have been absorbed, and the
lender have entered into possession._
Such is nearly the result of Mr. _Hume_’s reasoning on this pretended
_mania_ of supplying the wants of the State, by mortgaging its revenue.
Let me be permitted to urge a few words in answer, on behalf of the
landed proprietor.
Whatever use the sums borrowed are put to by government, in this respect
the nation and the lender stand nearly in the same predicament as two
individuals who should have set up an undertaking at a joint expence:
when it is completed, each of them first takes back his capital, before
they share the profits. In point of national enterprises, is war the
object? The profit is existence and glory, if the war has proved
successful. Are public establishments in prospect? Then the lender shares
in their utility and comfort. Has the employing of the capital been
productive neither of glory, nor public establishments? In a word, is
the State reduced to its primary and bare existence? The capital lent
will not, at least, be lost to the lender, _if administration think fit
to observe how little it costs to be just_; and the lender, on his part,
will reflect, that he should not have been a greater gainer, had he
buried his treasure during the time of national distress and that, had he
lent it to individuals, he might have lost it entirely.
What I have just said, will, I think, suffice to refute the extravagant
pretensions which Mr. _Hume_ is pleased to suppose in the lender. What I
shall add, will also be sufficient, I hope, to quiet the scrupulous minds
of those who might entertain some doubts on the injustice of despoiling
the landed proprietor; I mean, the injustice of any kind of spoliation,
but that which may be the consequence of his own extravagance.
That man who gives up his land for the annual quit-rent of a quarter
of wheat, and two shillings when the wheat was at four shillings only,
supposed he had entitled himself and his heirs to an income of a quarter
and a half of wheat; yet his representatives enjoy, at this day, only one
quarter, and the 18th or 20th part of another.—Will these insist, that
the meaning of the landlord having been to secure, and that of the tenant
to grant, such a portion of the landed revenue, as might be at all times
equal to a quarter and a half of wheat, it is unjust to act in direct
opposition to the intention of the contracting parties? This objection
would appear very forcible, and yet would go no further than to prove,
that, when a proprietor gives up his land for an annual consideration, he
ought to stipulate that it should be paid in kind, if he means to keep up
to the same income; if not, the landlord must be referred to the terms of
his contract.
The state-creditor stands in a far more disagreeable predicament; he
cannot even suppose, on his part, an intention hostile to the general
good. Whoever lends to the State, knows that the latter cannot pay the
interest it submits to, but by taxes, which, in the long-run, affect
every thing alike; and that one must cease to be a consumer, if he would
forbear coming in for his share. Now, whilst the exigency of the State
requires fresh loans, and course additional taxes, whoever advances of
the stock, the interest of which is paid by means of those very taxes,
cannot entertain any hopes of avoiding their effect, unless it be for a
short period, which depends entirely on the adopted scheme of finance.
Some of these schemes extend, others shorten the round such taxes must
go through, before the burden falls equally on every shoulder, _and
becomes null by its universality_. I say _null_, all injustice set aside,
which is inseparable from some sorts of taxes, of which I shall speak
hereafter; but, I add, _strictly null_, even in regard to the lender,
although the price of every article be raised, whilst his revenue alone
continues on the same standard. And I ground my opinion on the following
reason, which appears to me unanswerable: The difference between the
interest of money, and that of landed property, is always a sufficient
indemnity to the monied man for the rise, occasioned by the taxes,
on the prices of the produce of land and industry; but _nothing can
compensate the landed proprietor for that pretended increase of wealth
called Money, or that supposed poverty known by the name of Taxes, but
a proportionable increase in the price of his goods_[3]. A word more
on the lender. One may take the part of that important individual, who
accumulates those savings by which the State is to profit. It is allowed,
I say, to support such a man even against the State, when the State
attempts to reduce him by an useless reimbursement, by an _unnatural_
operation; but he should be assigned his real rank in the State, that he
may not complain of the _natural_ reductions. In this case, I think, we
should be more just, more humane, and more equitable, than Mr. _Hume_,
when, in the continuation of the scheme of national loans, he offers to
the posterity of the present owners of landed estates, no other prospect
than that of serving, as coachmen, the descendents of their footmen,
and no other means of averting the prophecy—but _a bankruptcy_. (_Vide_
_Hume’s Public Credit_, Essay IX.)
_Reflections on the two foregoing Articles._
If it were very true, though upon the first blush rather strange, that
after an operation so simple as that of increasing the price of the whole
mass of commodities, or rather suffering it _naturally to increase_, in
proportion as the taxes and the effects produced by them enhance the
price of all the products of industry, which are to bear those taxes—were
it true, I say, that after so plain, so simple an operation, it would
suffice, in order to secure for ever, in the most efficacious manner, the
payment of the interest on any given national debt whatever, to find,
_once for all_, in cash and paper, a sum which would exactly be, to the
mass of the specie and paper already in circulation, as the interest of
the debt, and the reactions of which I shall speak in the sequel, are
to the mass of the two revenues—were it equally true, that those who
are to be paid that interest, should, _after these two previous data_,
have nothing in the world to dread but the reimbursement of a principal,
the interest of which should appear so oddly secured, it would then be
impossible not to confess, that _England_ has hitherto been a prey to
great uneasiness, with very little foundation.
It would then be necessary to conclude, that all other nations were
greatly in the wrong to think that _England_ had any reason to be alarmed.
It must, in this case also, be acknowledged, that _France_, in 1720,
very unreasonably cut asunder the _Gordian_ knot of her difficulties, by
declaring in substance that she owed no longer 15 millions _Tournois_ of
the debts which she had contracted; since, without so barbarously cutting
the knot, and thereby effecting the ruin of thousands of wretched beings,
she would have secured their fortune by imposing without mercy, or rather
with judgement, a tax of 75 millions on all the produce of industry,
which this tax would not have raised by one twentieth part; whilst an
_Arrêt_ from the council, permitting _then_ the exportation of grain,
which was not allowed till 50 years after, would have proved more than
sufficient to enhance, as it must have done, the price of commodities,
in order to make amends to the landed proprietors for the increase which
they would have found in the products of industry.
Above all, it would be necessary to admit, that no minister, in any
country, could, for the future, without a horrid perverseness, without a
want of judgement bordering upon insanity, propose, neither all together
nor separately, expedients as shameful as they would prove useless;
and that no individual could hereafter dread such measures, without
being guilty of folly. What a security, then, for the Subject! what an
advantage to the State! what a _facility_ for Administration!
Under this point of view, the idea I start deserves to be examined; but I
once more entreat the reader not to pronounce finally upon it, until it
has undergone the full exposition which I propose to give it. Nor shall
I think I have written in vain, if I succeed only in making it appear
so feasible, as to induce some abler hand more deeply to investigate it.
Where is the man who would not wish to find it true? where is the man who
could have an interest in finding it otherwise? I confess, perhaps to my
shame, that it has engrossed my attention for a long series of years; I
apply it to every thing, I square it with every thing; and the more I
consider it under all the suppositions which my fancy suggests, the more
I compare these suppositions with all the facts which it is possible to
ascertain, and which seem to bear any relation to the subject, the more
am I convinced, not only that the matter stands thus, but even that it is
impossible it should be otherwise.
In fact, if I return to _Great-Britain_⸺
It would be absurd to suppose, that the taxes necessary to discharge the
debt incurred during the late war, exceed the twentieth part of the value
of the products both of foreign and national industry, consumed within
the country. In this case, is it not impossible that the additional tax
of a twentieth, in whatever manner it may be assessed on the mass of
those products, should not enhance, by a twentieth, the value of this
very mass? Let us call it a fifteenth; all kind of reaction included.
Is it not impossible that this additional fifteenth on the price
of the products of industry, be not followed, sooner or later, by
an equal augmentation on the productions of the earth, unless the
proprietors of land should submit to diminish, by one fifteenth, their
own consumption,—the home consumption (_the only one that secures the
prosperity of the State_) and diminish it, in order to increase, by so
much, the exportation, according to the ideas commonly adopted which
would be as contrary to the facts that I shall adduce hereafter, as it
would prove hostile to the interest of the State, to the interest of the
proprietors, and would operate in direct opposition to the spirit of the
tax, _which is certainly to produce its own amount, without taking the
trouble, every year, of going in search of it to ~Lisbon~_.
Is it not impossible that the augmentation of one fifteenth, upon the
price of every produce in circulation, should require any thing above an
additional fifteenth, in the sums which had been hitherto sufficient for
_brokerage_, and the transports of all kinds of property?
Is it not impossible that this fifteenth, both in new specie and paper
currency, once obtained, the interest of the latter part of the debt
should not be very firmly established, _funded_, without any one being
the worse for it, _if the price of labour increases like that of its
produce_?
Such, I repeat it, such will be, in the last analysis, the result of the
underworkings of nature; of nature, ever more slow, but ever more skilful
in repairing evil than men are in creating it; of nature, who, as good at
all times as the bread which she breaks to her children, fills up without
intermission, incessantly levels, behind them, and unknown to them,
whilst they are amusing themselves or playing tricks upon each other, all
those little furrows which they imagine will be left to the care of their
posterity.
Some one, no doubt, will exclaim against this additional fifteenth upon
the prices of every commodity; an augmentation which I have represented
as the only remaining trace of a war, which, for five years, attracted in
both hemispheres, the eyes of all whose brains were not heated by it. I
shall grant therefore that it was necessary to add thereto,
First, the trifling difference which must result from the impossibility
of a thorough good understanding between the interested parties, together
with the intention, not very liberal, but natural enough to each of them,
of gaining more than they can lose.
Secondly, the difference, perhaps more sensible, which must follow the
method so much boasted, of taxing in preference, those objects which are
consumed by the rich; as if it were possible to apply to any object, an
extraordinary portion of a given revenue, without taking off that very
portion from some other article, the consumption of _which is equally
necessary to the subsistence of artizans of another kind_.
Thirdly, and in fine, the far more considerable difference which must be
produced, _especially in England_, by another kind of taxation, of which
I shall speak hereafter.
Nothing contributes so much to render a question undeterminable, as to
perplex it with a multitude of accessaries, each of which would require
a separate dissertation; consequently, nothing can render the solution
easier than to reduce it to the smallest compass. Some other person will,
no doubt, do much better, what I can do only according to the extent
of my abilities; nor did ever an author peruse his own work with more
pleasure than I shall read the production of any one who shall throw the
light of evidence where I can only form surmises. But if it be true,
that after a short space of time, without any other assistance than the
natural clashing of one interest with another, taxes, _judiciously laid_,
are hurtful neither to individuals nor to the State,—would it not be
better to labour with care to _lay them judiciously_, than to think of a
reimbursement, the only effect of which will be to diminish, for a short
time, amongst some individuals, the power of paying those very taxes?
I beg permission to add a word more on this fatal reimbursement.
_A Thought substituted to that of a Reimbursement._
To write in _England_, nay, to write with obstinacy against the plan of
a reimbursement, the necessity of which is acknowledged by the whole
nation, who expect wonders from its execution; to write for the purpose
of persuading that such a step would equally militate against the
interest of the State, and that of the subject; and especially to hazard
such visionary ideas at the moment when _France_, so clear-sighted on
her own interests, is herself busy in effecting a like reimbursement ...
must surely be the attempt of a man hired by the _French_, to excite,
if possible, some ferment in those heads which are all wound up to
calculation; and to raise, during the little time the calculations will
require, some plausible doubts, in order at least to delay the effect, of
so salutary, so essential an operation; for, _France_ is so interested in
the ruin of _England_, that she ought to spare no means to stop her, were
it but for an instant, at that point which it has not been possible to
prevent her from attaining.
On the other hand, to write in _French_, and endeavour to introduce
into _France_, a pamphlet in which the author does not profess himself
an admirer of a reimbursement, the possibility of which, now clearly
demonstrated, has excited there a general enthusiasm, a kind of rapture
the more excusable, as the most evident disorder in all parts of the
finances, during the space of 80 years, did not permit even the humane
and sensible mind to form a single wish for that very measure of which
the execution is so certain, and the advantages pretended to be so
positive.... It is suing with impudence for the good graces of a nation,
to which I have, as it were, been turned over by the cession made to
it of the country where my fortune lies: it is ridiculously flattering
myself that I shall justify by a _trait_ of unbridled licence, the title
of _Englishman_, conferred on me by the treaty of peace.
It is certain, that more than once a man has been most secretly accused,
tried with the greatest expedition, condemned without being heard, and
punished with merciless severity, in consequence of charges much less
specious than the above; for I confess that there is a faint glimmer of
plausibility in the heads of accusation which I have brought. But, in
the end, justice must be done; and, thank heaven, my present trial is on
the very first instance, brought to its last stage; the public shall be
my judge; they shall be put in possession of all the documents relating
to the trial; and I presume to hope, that no one of those who shall
be able to bear the perusal of them, will suspect my sincerity when I
protest, that, without any other motive but that which has at all times
invariably guided me through life, I would burn this paper, if I could
find therein a single word that might be hurtful to _France_—I would
burn it, were I to find therein a single word that might be hurtful to
_England_—I would burn it, were I to find therein a single word that
might give offence to any individual of either of the two kingdoms.—But
I freely own, that my ambition would be far from receiving its full
gratification, were this work to prove useful only to those two parts
of the world, however brilliant the part they act therein.—URBI ET
ORBI.—_Shakespear_ says that the Warrior seeks “the bubble _glory_ in the
cannon’s mouth:” a man who presumes to think, looks for it in the bottom
of his inkstand: their hope is not always crowned with success; nay, very
often, the one meets only death, and the other contempt. Yet there are
some lucky chances: sometimes the former saves his country, the latter is
sometimes serviceable to all mankind.
Be it as it may, I intreat the reader to observe, that the principles
I lay down do not tend, by any means, to lessen the public credit,
to spread any doubt on the faculties which _France_ and _England_
have of effecting the reimbursement which both these nations have in
contemplation; I maintain, on the contrary, with the simplicity of a
_child_, that it is a _childish play_, for the one as well as for the
other. I say, that the one who appears the most distressed of the two,
and is the most taken up with her pretended distress, has only to take
from the _pocket_ of one, what he will be very _averse to give_, and put
it into the _hands_ of another, who will be equally _averse to receive_.
I say, with respect to the nation, which _now_ acts the most brilliant
part, that all she has to do, is to give, to those who do not ask for
it, a sum of money which she receives, and has no occasion for; _to give
it_, I say, for fear of being solicited, importuned, and teazed, to make
a bad use of it, or else be obliged to hoard it up, to the very great
detriment of circulation. I shall add now, that a business, which to
me, does not appear a _childish_ one, but really that of a man, would
be to examine, whether the 40 or 50 millions of livres annuity, which
are about to expire by degrees in _France_, and the million, or million
and half sterling of taxes to be levied in _England_, over and above the
sum necessary to pay the interest of the national debt, and other state
expenditures, will be better employed in the diminution of some private
revenue than in the increase of the general wealth in both States; that
is to say, whether it is most advantageous to pay off the creditors, who,
by such a reimbursement, will be compelled to place at 4 and at 3, what
brought them in 5 and 4 _per cent._ than to lay out the money, for the
purpose of increasing, perhaps by one fourth, the products of agriculture
and industry, by a faithful and judicious repartition of those sums upon
the cultivation of some millions of acres, which now yield nothing but
brambles, or yield only the half of what they ought to produce.—How many
of this description are to be found both in _England_ and _France_!⸺This
is not all: how many kinds of taxes, the effects of which have not been
sufficiently searched into! How many more, whose pernicious consequences
are fully known! How many more, the levying of which can be justified
only by reason of their produce being wanted, or by _the supposed_
impossibility of a commutation!—Ought the State to reimburse, before
those have been scrutinized, these repealed, and all commuted which shall
appear evidently to militate against sound principles?
The great art does not consist in finding, at pleasure, one million
sterling more in _France_ as well as in _England_, or _vice versâ_.
Heavens! what kind of minister would that man be, whose genius could
not discover, in either kingdom, in the multitude of objects truly
susceptible of taxation, a number of articles capable of furnishing that
million annually, without injuring the general consumption, beyond the
first year at the worst? The only difference which, in this respect, I
might point out between the two nations, is, that in _France_ the impost
would be registered, and paid after the usual remonstrances; and that in
_England_, were the tax to have been devised, even by Supreme Wisdom,
on the actual system, all those who might think themselves directly or
indirectly interested in the operation of the tax, would not fail to
clamour as loud as possible, and not without reason; for, after all, if
the objects taxed, are equitably taxed, and in a due proportion with
all the rest, why, out of 160 objects and upwards, already charged
with equity, should _ten_ be picked out to be overloaded with a new
burden?—Has at least a rotation been established for the future?—On
what principles? Or does it evidently appear that there can be no fixed
one adopted on so important a matter?—If a tax is offered to be laid on
such articles as have paid none hitherto, then _Opposition_ stands on
firmer ground; for, are not those objects, by their nature, evidently
as sacred as the ark of the Lord? Did ever the least scrupulous, the
boldest Minister of the finances, dare, to this day, to lay his hand upon
it?—Would he have respected it, if he had not trembled for his head;
that is, in plain _English_, for his place? For, thank Heaven, there
is no necessity, now, for the _English_ to be more hot-headed than any
other nation in _Europe_. It is generally acknowledged among themselves,
with true _English sang-froid_, that, on the part of those champions
of patriotism, who, according to the interest of the day, charge each
other by turns with selling the people, and betraying the _SACRED
constitution_, all terminates now in the most exact change of admirable
sarcasms, and exquisite railleries. The pleasure of being a Minister
because _the minister alone can do what is good_, and the concern at not
being a Minister, _because the minister alone can do what is good_, are
now productive of nothing more in _England_; and the People, as well
as the King, are not worse served for it, nor are they worse informed:
witness the speeches on both sides.
Amongst the questions which I have mentioned, and many others always
appropriated to the subject, there are some sufficiently weighty to
puzzle, in _England_ as well as in _France_, the respondent who should
be obliged, before a tax is laid, to answer them in a _satisfactory_
manner. Luckily, as I have already mentioned, in _France_, thanks
to the monarchical constitution, the King _commands_, the Parliament
remonstrates, registers, and the People pay: and, as is known to all
the world, thanks to the free constitution of _England_, there the King
_demands_, the parliament debates, grants, and the People pay. With that
facility which exists every where, of doing what is not palpably absurd,
I think it might be possible now, without bringing credit or authority
in question, to renounce the little vanity of devising a productive
tax; and that a man of common abilities ought to confine himself to the
establishing or maintaining order and clearness in the accounts, to
the diminution of expences in collecting the revenues, and to fidelity
in the use of them.—But the true, the unacquired glory to be obtained
by a financier, would be, I think, to hit upon a simple scheme, the
application of which might be obvious in all cases, a scheme productive
of no fruitless evil, permitting all possible good, and which might, by
degrees, be substituted to those vague taxations, to those _taxations_
founded on false principles, to those wild notions, which, by adding
_five_ to an article not worth _three_, raise nevertheless that object
to _eight_, and leave the trader at liberty to sell that for _fifteen_,
which he sold formerly at _four_. It is true that, on the first exigency
of the State, they pretend to remedy the abuse by an additional tax
called _licence_, or by any other name which answers the same purpose,
and compels the peculator to refund part of his extortion. But what does
this licence come to, after all?—_To sell to a man the right of ransoming
more severely the public, after having previously furnished him with the
means and pretence for doing it._
No one doubts, in _England_, but that the system of _French_ taxation
is a very bad one; nothing so self-evident as the reasons adduced in
proof; every thinking man in _France_ approves of those reasons:—but
does it clearly appear, that in _England_ some parts of that system are
not adopted?—Is it not true, on the contrary, that it has prevailed,
for a long time, in one point truly essential, in regard to which they
have but diminished its inconveniencies, without thinking perhaps of the
injustice, which is as inseparable from it, as it is from those wherein
it appears more evidently?—The advantage of taxing the consumption
is generally acknowledged; it is as generally believed that the way
of bringing this system to perfection is by taxing, above all, _the
consumption of the rich_:—yet, were it to happen that the poor should
be more injured, and that for a longer time, by a natural effect of the
very operation devised for their release, than he could be aggrieved if
nothing should escape the tax....
I shall venture to throw out some thoughts on these different objects,
after I have examined whether the necessity of a balance of trade,
constantly favourable, be not as doubtful as that of a reimbursement,
and a bankruptcy; and whether that balance is really such as many people
imagine it.
_General Balance of Trade in ~England~._
When the proprietor of a considerable sum in the _English_ funds examines
Sir _Charles Whitworth_’s truly valuable work, _State of the Trade of
Great-Britain_; he thanks his stars, and says, “I have nothing to fear
whilst the balance of trade continues in favour of this kingdom; but
the moment it shall turn against her, recourse must inevitably be had
to the expedient so long postponed: the application of the _sponge_ is
inevitable.”—
I have perhaps already said enough to animate the greater part of those,
who are concerned in the public funds of every enlightened nation,
against every other fear but that of a reimbursement; but, as it may
be believed, with regard to the public funds in _England_, that I have
reasoned on the supposition, generally admitted, of that balance in their
favour, of which the _English_ are so jealous, I would wish doubly to
strengthen the mind of the parties concerned, by proving to them that
their fortune rests on a basis much more solid than that of a pretended
_favour_, which the private interest of every merchant, vigilantly
repels, whilst the fancy of the body at large happily confines them to
believe in the idol, and to invoke it.
I am indebted to the details contained in Sir _Charles Whitworth_’s work,
for the advantage of applying to real facts, many reflexions which I had
digested before I had read that work; but I was, till then, reasoning on
_hypotheses_; I now reason on what so nearly approaches reality, that
it is necessary to controvert my arguments, instead of consigning their
foundation to the system of chimeras.
By means of that valuable work, I see, from the year 1700 to 1775,
and that in the greatest detail, strengthened by all the proofs that
the nature of the subject can admit of, a constant superiority of
exports, which, in the space of 75 years, amounts to the enormous sum
of 267,774,769_l._ (I have overlooked the fractions of each article.)
This is, in the total amount, much more than one half of the gold and
silver imported into _Europe_ from _America_, during the same lapse of
time; but, of this period of 75 years, 30 must be attended to, wherein
the superiority of _English_ exports comes up very nearly to five-sixths
of the general importation of those two precious metals, _which were to
make good so many other balances_. We should also observe, amongst those
years, a most flourishing one, wherein that _English favour_ absorbs,
as it were, all the silver imported into _Europe_; and five other years
still more wonderful, where it surpasses that general importation by
10, 12, and even 1,300,000_l._; for, in 1750 the general exportation
of _English_ goods exceeded the importation of foreign produce, by
7,359,964_l._ and yet all that product of the _mines_, belonging to
_Spain_ and _Portugal_, is estimated only at 6,000,000_l._ sterling _per
annum_.
I shall suppose, for a moment, that, during the space of time I have just
mentioned, the balance of trade did, in reality, produce to _England_ an
importation of money, to the amount of 267,774,769_l._ (for the reports
of the Custom-House, as stated by Sir _Charles Whitworth_, brought in
as a proof of that pretended, uninterrupted balance, in _favour_ of the
nation, mean what I have said, or mean nothing at all, in regard to this
matter; they do not prove one penny if they do not prove the whole sum).
It is true that, according to the same reports, we must deduct for the
money exported from _England_, during the course of those 75 years, about
105 millions, by which the nation at least got rid of a surplus which
would have strangely disparaged the price of that which was preserved in
the country: but is it very certain that the 162,774,969_l._ the precious
_nett_ of the pretended balance, was actually preserved? This appears to
me impossible, for the following reasons, which may perhaps furnish us
with the means of knowing, precisely enough, in what the true balance
consists.
Since the beginning of this century, the real and nominal value of
the revenue in the other parts of _Europe_, has doubled, as well as
in _England_. Now this augmentation, in the products and prices, has
required, every where, a proportionable increase of the means of
circulation; and _Spain_ and _Portugal_ are nearly the only two sources
from whence that increase of means could be procured.
In the supposition that the revenue of _England_ constitutes one tenth
of that of _Europe_ (it is a great deal), the other nations composing
that part of the world were of course obliged to endeavour to secure
the nine tenths of the money necessary for their own circulation; and
their success in this is the less questionable, as, in case any one of
them should be short of money for the circulation of its property, the
_English_ themselves would eagerly supply that part of the precious
balance, which it might want, because, in this case, the importation of
money into such country would prove more profitable than an importation
of fresh goods, whilst the old ones, carried there already, waited for
money to circulate them. Hence it may be concluded, that the _English_
never had, or at least have not preserved, more than their tenth,
twelfth, or rather, more than their natural portion in that absolute mass
of gold and silver necessary to the circulation.
I shall now say, that it is not even probable that they have preserved
that _quota_, necessary every where else for the circulation of a
revenue similar to theirs, because _England_ is, of all known nations,
the one where the circulation of property of all kinds, requires a
less quantity of real cash: the merciless severity of the laws against
debtors, the general credit which it encourages, the use and indubitable
value of paper currency, which are derived equally from both, are three
objects which, in this respect, set _England_ far above _par_, in
comparison with all the other nations who have neglected to secure to
themselves the same advantages.
Might we not further say, that _England_ evidently has not thought proper
to get that _quota_, which she might have claimed, since one third, and
perhaps half of her circulation, is effected by paper-money with more
dispatch, with more facility, and with as much solidity as if it were
effected by cash?
It will be asked, perhaps, if I pretend to infer at last, that the
exportation has not been so considerable as it ought to be supposed from
the statements of Sir _Charles Whitworth_? I shall answer to this, as
to many other queries; it may now be seen that a few millions more or
less, are a matter of perfect indifference, in regard to my main object.
The exportation from _England_ is clearly prodigious; its immensity is
proved by that of the tonnage of the shipping employed for her trade,
775,624 tons in the years 1771, 1772, and 1773, (see _Chalmers_’s
_Estimate_); this point is established beyond all equivocation. What I
refuse therefore to the imagination of the trader, is solely what appears
to me chimerical and useless in that favourable balance of money; and
this _I refuse_, because I cannot possibly but acknowledge, that every
trader has too much good sense to act against the general interest of
trade, when such operation must, at the same time, prove contrary to
his own interest. Nay, is much more than plain instinct wanted, not
to import money which yields a very trifling benefit when there is no
demand for it, whilst one may take up foreign goods, on which there is
a certain gain of 10 or 12 _per cent._ because they are eagerly sought
after? and when, besides, the nation, on a certainty, will not finally
pay for them but with national goods, since she has no mines of her own?
I must observe, indeed, that this very trader, guilty of such an act of
_impatriotism_, of this national crime of importing merchandize instead
of gold and silver, cries up, as loud as any other, _the necessity of
striking a favourable balance_; but private wisdom gets the better of
public folly; every one imports such goods as he is in hopes to sell
to advantage, and leaves to his neighbour the care of importing that
_favour_ on which no profit can be got.
What is then the quantity of bullion really imported every year into
_England_?
It is incontestably, in the first place, so much of it as is necessary to
answer the progressive increase of the prices and products, both of the
land and industry; the bank-notes cannot suffice to that augmentation,
but in their ordinary proportion to the real specie in circulation;
all supplement of bank-notes, which in the needful hour exceeds that
proportion, must soon be replaced by real specie; on this exactness
stand the credit of the Bank, and the vast advantage accruing therefrom
to the public, and to the State; but from thence also results a greater
inutility of accumulating money before it is wanted.
It is, in the second place, all the bullion necessary for the labouring
gold and silver-smiths, from the first gold-smith in _London_ to the last
plated-button maker at _Birmingham_.
It is, thirdly, all that importation which is required to make good
the _deficit_ occasioned by petty stock-jobbing, and the melting down
of guineas, which no workman will ever scruple, when there will be a
few more pence to be got that way, than by the purchase of bullion, or
as often as, having no bullion at hand, he shall find himself in the
immediate necessity of working.
It is, fourthly, all that which is wanted to replace the few guineas
carried away annually from _England_ by travellers, smugglers, or by
means of some inferior transactions in trade, and which cannot always
be exactly balanced by the contraband trade carried on elsewhere by the
nation.
Ever since the _English_ have acquired the immense landed revenue which
they possess in the _East-Indies_, it is probable they do not carry there
so much money; yet some must be sent there. The above five articles are
the only ones I know of, which may render necessary an annual importation
of money. The first of those articles is absolutely independent of the
caprice of any one; it is always subservient to the quantity of effects
to be put into circulation, as well as to their price; and can at no
time deprive the other parts of _Europe_ of their share in the mines of
_America_. The third and fourth are in a manner included in the first;
nor can they, when viewed separately, be very considerable: The second
alone is truly prodigious, but is likewise subservient to the demands
of that very silver when wrought, that is to say, converted into some
articles of luxury: But it is necessary to observe, in regard to this,
that great care is taken to find out purchasers for that metal thus
improved by the hands of the workman, not only in _England_, but wherever
people can possibly be found willing to take from her, that part of the
precious balance, which she had taken upon herself, only in hopes of
getting rid of it.
This I think is sufficient to demonstrate the impossibility of that
pretended _favourable balance_, amounting, in the space of 75 years, to
162,774,769_l._ the existence of which many people imagine to be real,
from the statements of Sir _Charles Whitworth_: for, if they would
confine themselves to say, that, in the course of 75 years, _England_
has profited in trade to the amount of 162,774,769_l_. I have proved
much more, since I proved (p. 17 to 22) that all the benefits which have
accrued, and might now be spent, form together a solid mass of clear and
palpable savings; and that this mass would now be, without doubt, 332
millions, instead of 162, had the 180 millions, lent by the subjects to
government, and swallowed up by the war, been laid out in the improvement
of lands and industry.
As to the inference that might be drawn from the apparent exportation of
105 millions of money, during the same period, according to the above
statement, it is also necessary to make an observation on this matter.
In any grand mercantile operation, where prompt and certain remittances
are required, be the motive of such operations what it may; if there goes
out of _England_, we shall suppose, 400,000_l._ in bullion, this very
same bullion, after the bargain is struck and fulfilled, either in goods
or in bills of exchange, comes back to _London_, to resume if necessary,
the same course three weeks afterwards: For the space of 40 years,
therefore, the same sum may an hundred times be placed in the catalogue
of exports, and perfectly answer to a capital of 40 millions, the place
of which it has really supplied: This is a well-known resource; nothing
then can be concluded in regard to the 105 millions of bullion exported,
according to Sir _Charles_, but, that there ever has been, and probably
ever will be, in _England_ all the bullion necessary to answer the
exigencies of the most unforeseen and extraordinary negociations of all
kinds, and industry enough to recall in time, that bullion which had only
been given as a pledge. It is like a jewel worth 100,000 crowns, which,
for the space of 20 years, is said to have passed ten times backwards
and forwards from _Paris_ to _Amsterdam_, but finally remained at
_Amsterdam_, by a reason contrary to that which keeps up the commercial
shuttle between _England_ and _Holland_.
In order to come as close to the point as it is necessary, on a matter,
besides, of which it is equally useless and impossible to obtain an exact
knowledge, here follow some facts, the essential results of which by no
means depend on more or less exaggeration in the exposition either of the
sale, or of the credit.
The period from 1764 to 1773, must be allowed to have been the most
flourishing era of _Great Britain_. During those ten years the
exportation of _English_ merchandises into _Spain_, has exceeded the
importations from _Spain_ into _England_, by 5,095,998_l._ In the same
space of time, the balance of trade between _England_ and _Portugal_ has
been 3,274,133_l._ in favour of the former. The two _favours_ united,
amount all together to 8,370,131_l._; add thereto the _favourable
balances_ of _Madeira_, and the _Canary_ Islands, paid probably in
_Spain_ and _Portugal_, amounting, in the same space of time, to
516,863_l._—the total presents us with the aggregate sum of 8,886,994_l._
which, divided by 10 years, proves an annual balance, _in favour_ of
_England_, of 888,699_l._ real money.
The light of probability now begins to dawn upon me: at least I here find
myself at the source of money; and, as I know, first, that _England_
must absolutely be provided with a certain quantity of it, whatever that
quantity may be, for the five articles before mentioned:
Secondly, That she exports, of her own goods, fifteen times as much as
she need to do for that purpose:
Thirdly, That gold and silver are to _Spain_ and _Portugal_, what wines
are to _France_, silks to _Piedmont_, hemp and timber to _Russia_; and
that, in order to procure those different articles at the easiest rates,
they must be fetched from _France_, _Piedmont_, and _Russia_:
Fourthly and lastly, that _Spain_ and _Portugal_ stand exactly in the
same need of making away with the surplus of their gold and silver,
as _England_ does of acquiring it, by getting rid of a surplus of her
manufactures: I cannot therefore entertain the least doubt, but that it
is at _Cadiz_ and _Lisbon_ that _England_ procures all that gold and
silver which is indispensably wanted for the five operations spoken
of; and I must positively conclude, that there she has taken the whole
quantity which she had occasion for; but I as positively conclude,
that she took up only so much of it as was wanted, when I see that it
depended entirely upon her to take more, and that she has not done it:
A decisive point, which I cannot by any means call in question, when I
have convinced myself, by Sir _Charles Whitworth_’s statements, that
this sum of 888,699_l._ which _England_, if so disposed, might have
procured annually during the ten years above mentioned, is no more than
the balance of 1,785,826_l._ in goods exported there, one year with
another, during the same space of time:—For, after all, why should not
_England_ have taken _in money_ the amount of 897,157_l._ of _Spanish_
and _Portuguese_ goods, taken by her ships in return, were it not that
the value of money, as that of all other kinds of merchandise, is always
tyrannically fixed by the demand?
It seems, therefore, probable enough, that the money annually imported by
_England_, during the period aforesaid, does not exceed the 888,698_l._
of the balance which appears against _Spain_, _Portugal_, _Madeira_,
and the _Canary_ Islands: But here follows a strong conjecture, that
it is not so considerable as it appears by those accounts.—It is
an uncontroverted fact, that the article of exportation is always
exaggerated more or less; the man who first bethought himself of this
harmless cunning, fancied that his own importance would appear more
conspicuous to the nation, by reason of the quantity of goods which he
might seem to export: this is now the secret of the play-house, every
body knows it; but this practice is in a manner become necessary: one
must unblushingly raise himself above his level, in order to be thought
in his real place; the only way of deceiving in this respect, would be to
speak the truth; and, in this case, the deceit would fall on the deceiver
himself, and that just regard which the exporter has a right to claim,
would be lost to him: Add to this necessary artifice, which is no longer
a cheat, the usual mode adopted in regard to importation, the value of
which is always a little under-rated, but only a little, because there
might be some inconvenience in cheating Government to excess. With these
trifling modifications, I think _England_ will be found not much above
the _par_ of her _quota_, in the gold and silver imported from _America_.
Now, out of these 6 or 700,000_l._ in money, which I believe are really
and annually imported into _England_, what quantity is sent to foreign
markets,—not, indeed, before its value is considerably advanced by
the workmanship?—But, if this metal be so precious, why part with it
when once acquired? Why not employ the workman upon objects, the price
of which would have received a ten-fold increase by his labour? Why
should these continual prophanations of the sacred metal be permitted?
Why give encouragement to that kind of prostitution of gildings of all
sorts, which daily consume such quantities of gold? It is said, that
in _Birmingham_ alone, they consume 30,000_l._ worth _per annum_:—And
shall it be on a metal thus lavished away, shall it be on that pretended
balance, that _England_ will build her resources, and the security of her
creditors?—In what consists, then, the wealth of the nation, that wealth
which is truly independent of all circumstances, and which will ever be
superior to the national wants?
It consists in any sum whatever, money and paper currency, which is
required to keep in the utmost activity, 3,000,000 of cultivators,
3,000,000 of tradesmen, and 3,000,000 of other consumers, as
indispensable to realise the value of the objects by them consumed, as
the tradesman and cultivator are necessary to produce them:—And if any
question should arise on the number of inhabitants,
It consists in the number of men necessary to furnish annually exports to
the value of fifteen or sixteen millions:—And if it should be urged that
this exportation is over-rated,
It consists in the number of men capable of making up that quantity of
exports, which is annually required for a trading navy of 775,024 tons,
on the statement of which there cannot arise a single doubt.
It consists in a population necessary (which doth really exist, and could
not be dispensed with) to find, without any other inconvenience but a
momentary sensation, the 100,000 seamen of the royal navy, the 70,000
national soldiers, and the 3 or 400,000 artificers, and other persons
employed in every way, who, by the last war, were for some years taken
away, from their daily and useful occupations, some monuments of which
would probably have been transmitted to posterity, in order to their
being employed in all the accidental operations that were requisite to
carry on those destructive plans, which have left nothing but a sad
remembrance behind: _A remembrance, nevertheless, of which the most
allowable pride should allay the bitterness._
It consists also, perhaps, in that revolution, which must have been
effected in the mind of every intelligent _Briton_, by the demonstration
grounded on experience, of the impossibility of doing beyond a few
minutes, with a given number of men, more than that same number is
capable of effecting habitually, and without fatigue.
It consists in the impossibility of not doing, even to the end of ages,
with a given number of industrious men, all that which the same number
have executed during 80 years, not only without exhausting themselves,
but rather, on the contrary, still increasing their strength and wealth.
It consists, in fine, in the demonstration which will become daily more
palpable, that labour alone is the source of that wealth; that the more
the sum of this labour shall augment, the greater will be the increase
of riches; but that this same labour will not reach its last degree of
activity in _England_, till it is nearly in the same state in _Siberia_;
and that there is no great harm in an _English_ mechanic creating a
cultivator in _Siberia_, or even in _France_, provided a _Siberian_ or
_French_ mechanic, create a cultivator or mechanic in _England_.
_Reflexions on some private Balances of ~England~, both of the favourable
and disadvantageous Kind._
In the small number of disadvantageous balances, the necessity of which
is so grievous to _England_, I distinguish that with _Russia_, which,
in the course of the ten years above mentioned, amounts upon an average
to 825,212_l._ annually. This, in fact, is more than enough to swallow
up the 6 or 700,000_l._ of the favourable balance, during the same
period, against _Spain_ and _Portugal_, the only sources almost of the
precious metals; luckily the expence of _Russia_ in gold and silver is
ascertained, as it is every where else, first, by the quantity of coin
in circulation, a quantity always proportioned to the price, as well as
to the number of objects to be circulated; and, secondly, by the degree
of ease, riches, and pomp, which the generality of private faculties can
admit of, in the articles of furniture, plate, and dress: The introducing
of gold and silver, above the quantity necessary to answer those various
purposes, would, as the case is every where else, prove entirely useless;
for it can hardly be imagined, that so wise a Princess as the Sovereign
who now holds the sceptre of _Russia_, should think of hoarding up,
before her 20,000,000 of subjects be as rich, that is, _do produce and
consume as much as a similar population might produce and consume in
France or in England_: Now, to hoard up would be the infallible means to
prevent it. Let us now suppose, that the annual importation of bullion
necessary for the circulation in _Russia_, amounts to one half, or even
to an equality of what is wanted by _England_ for the same object:—It is
probable that _England_ contributes thereto no more than her proportion,
as the other maritime States, who, like her, are obliged to provide
themselves in _Russia_; and, consequently, the disadvantageous balance of
_England_ with _Russia_, can no more demonstrate that the former exports
there annually 825,212_l._ than the balance in her favour against
_Flanders_, clearly proved by the accounts of Sir _Charles Whitworth_,
can demonstrate that the above province is by her stripped of 521,201_l._
annually.
A publication truly interesting, would be a work containing a particular
account of the trade of each country, were it only such as that which Sir
_Charles Whitworth_ has given on _the trade of England_; but though such
a treasure is wanting, yet it appears to me, that to have a clear idea
of such a work, would be sufficient to foresee what would be the result
of it. All men are alike: one may therefore, without fear of deceit,
suppose in the merchants of every country, the same attention to swell
up the list of articles which pay no duty, and which give a trader the
petty consequence of a more considerable exportation; every where might
be found the same exactness, _in a contrary sense_, in regard to goods
liable to an importation duty; consequently the balance struck at last
would be in favour of the nation whose accounts should be then inspected:
but deduct from all those favourable balances, that which might have been
farther declared on the articles which are duty-free; add to the total
of the exports, what has been declared short of the true amount on the
objects which must pay; it would then be found that (the five articles
excepted) all is paid literally without having laid out any cash, and
that each nation is wisely reduced to the only real advantage of trade,
the _exchange of want against fancy, the exchange of one fancy for
another, or the exchange of one want against another want_.[4]
In fact, how can it be supposed, that a nation who should not sell to
one, or to six others, exactly as much as she has purchased from a
seventh, should not be, a little sooner or a little later, compelled,
either to give up a trade which she must support with real specie, or to
sell that at home for _five_ in cash, which fetched ten before? Is it not
evident, that a nation which should not purchase from one or six others,
as much as she sells to a seventh, must, sooner or later, find herself
in the necessity, either to hide her money under ground, or to lower its
value, so far as to sell at home successively for 6, 8, 10, and 20, that
which was sold before at 5? This would exactly have been the case with
_Russia_, had the annual balance of 825,212_l._ been effectually paid to
her in coin, either by _England_, or by those who stand on the debtor
side with _England_, and had the former put it into circulation, instead
of laying out the surplus of that balance in the purchase of goods from
six other countries, to whom the _English_ sold articles to a similar
amount: Now the _Russian_ trader does not in _Russia_ charge 20, for that
which, 50 years ago, was sold there for 5: the value of money is not
debased there, though _Russia_ has annually a claim upon _England_ for a
balance of 825,212_l._ and, probably, demands not less considerable upon
the other maritime powers; _Russia_, therefore, has cautiously avoided
receiving those different balances in coin.
Besides, money fetches but its price in _Flanders_, although, according
to Sir _Charles_, that province is indebted to _England_ in a yearly
balance of 521,201_l._—Nor is money worth above its price in _Germany_,
though the latter owes likewise to _England_ a balance of 924,709_l._
annually.—In _Ireland_ it goes for no more than its worth, though there
is another balance due by that kingdom to _England_, to the yearly
amount of 770,916_l._—Nor is it above its value in _France_, who owes to
_England_ an annual balance of 108,073_l._—Now, if money is every where
nearly of the same value, we must conclude, that there does not exist
a nation which has not found in her annual importations of gold and
silver, either considered as money, or as materials for some articles of
luxury, all that she stood in need of to keep up circulation, and provide
for that degree of luxury, which the _actual_ degree of her industry
_requires, as much as it allows_; in this case the final balance, deemed
unexact, that is, in _favour of England_, has, in fact, been kept
perfectly even. Each has sold here or there, as much as he has purchased,
and _vice versâ_; and the prejudice _England_ entertains on the necessity
of a _favourable balance_, has not, in practice, dazzled the eyes of the
merchant who carried on her trade: He has rejected the gold tendered to
him, when his profit upon it would have been but trifling, with as much
judgement as he has, with care, sought after such goods as could then
yield him a greater benefit.
_State of the Balance between ~England~ and ~Holland~._
Sir _Charles Whitworth_, in his _State of the English Trade_, rates the
annual balance due by _Holland_ to _Great Britain_, at 1,372,258_l._
upon an average of 10 years: This is the most considerable. There can
be no illusion, in regard to the effect this balance has upon the money
in _England_; it is well known that it does not increase it; nay, it is
thought that the debt due to _Holland_, lessens it annually, not only
by the whole amount of the _favourable balance_ which would revert to
_England_ were she not indebted to the _Dutch_, but of one million more,
which must be found to pay them off.
I have already said, and repeated, that in every circumstance where it
is necessary to borrow or to displace a capital, it is better to borrow,
even at 5 _per cent._ than to remove a capital which returns double
that sum; and that, on the other hand, it is more advantageous to lend
any sum abroad upon good security at 5, or even at 3 _per cent._ than
to lend the same sum at home, where it would yield only 2 _per cent._
or to bury it in the abyss of a Bank, whence nothing returns. Now what
proves that _Great Britain_ and _Holland_ are in this case with regard
to each other, is, that _England_ seldom or never opens a loan, but what
the _Dutch_ take a share in. What do they give for the purchase? Nothing
more than the surplus of the ordinary profits arising from a trade, which
they cannot extend sufficiently to employ the whole amount of their
savings. And why has this part of the _English_ loan been given up to the
_Dutch_ by the national capitalists? Because the latter could find in
their own trade, susceptible of a farther extension, a way of employing
their capitals to greater advantage, that is to say, of reaping a benefit
superior to the interest offered by the loan: How can this be doubted,
when we see that the loan falls into the hands of a small number of
merchants, who soon afterwards make over their debt? Would they transfer
it to any one, were not the interest it brings in, interest secured by
the nation, inferior to the ordinary profits of their commerce?
Therefore, if the balance due to the _Dutch_ is thought _burdensome_,
only in the supposition that it serves to pay _burdensome_ interests,
it cannot be looked upon in the same light, when the matter rests upon
a debt, by which the borrower clears a benefit superior to the interest
that he has to pay.—I shall present this question under another point of
view.
In the war which was terminated by the treaty of _Paris_, the most
considerable part of the debt contracted for its support, was acquired
by the _Dutch_: Why so? Because the _English_, carrying on, without any
opposition, an exclusive trade with every part of the world open to them
alone, found therein the opportunity of employing their capitals to a
far greater advantage, than that held out by government in the interest
of the loan. During the last war, on the contrary, the _English_, being
more narrowly circumscribed in regard to their commercial operations, by
a navy, the possibility of which they did not even suspect, much less
its real existence, and being kept more circumspect by a new system
which opened a free navigation to all the powers not involved in war,
thought themselves happy to find, in the national loan, an employment for
that portion of their capitals, which, from circumstances, was become
useless. The interests of the last debt are then due and paid within,
and by _Great Britain_; but will it be said, that _England_ would not
be so rich, were the 3 millions additional interest, with which she is
burdened, due to _Holland_, and had the _English_, instead of employing
their capitals, as they have done, in support of the last war, made use
of them in the same profitable manner as in the year 1755? had that
money, for instance, been laid out in the improvement of their waste
lands in _Europe_, _whilst Dutch cash should have fought against French
money, to determine how many European nations ought to be permitted to
carry to North America, the goods of the other parts of the globe_!
As to the full acquittal in money, _real_ and _effective_, of the
2,000,000_l._ interest, due to _Holland_ for her previous loan, it is
improbable, impossible, and useless.
_It is improbable_, because _Holland_, being already overstocked with
money, and carefully intent on getting rid of her surplusage in this
particular, at the first opportunity of placing it with security, would
still lower the price of it at home, were she to increase its mass; and
that, on the contrary, whilst _Holland_ takes in goods instead of money,
she keeps up the interest of the one, by securing to herself a benefit
upon the other.
_It is impossible_, because _England_ importing bullion from _Spain_ and
_Portugal_, to the amount only of one third, and being very cautious,
as observed before, not to import more than _one third_ of what she
owes to the _Dutch_, and this, not to pay them, but because this third
answers sufficiently to the five articles of which I have spoken
before;—_England_, then, cannot give to the _Dutch_ what she has not
received from another, and which she has not of her own.
_It is useless_, in fine, because all accounts whatever are balanced
with more ease, in the age we live in, by bills of exchange, than with
cash, and because the claims of _Holland_ are more naturally paid off, by
another debt due to _Great Britain_, for the produce of her exports to
some other parts of _Europe_, from whence the _Dutch_ carefully avoid, as
much as possible, to import any thing but merchandise.
But _would it not be better to owe nothing to foreign nations_? For to
this one point we ought to confine all the lamentations about _Dutch_
creditors.
The above question, so apparently simple, so readily to be resolved in
the affirmative, would grow perhaps more intricate, were it ushered in by
some previous queries, which might permit us to foresee the effect of the
national wish, when accomplished, if it could be obtained by the easiest
answer that could be given; for the case, no doubt, is not to examine,
whether it would not be better to have borrowed, without being obliged
to return, than to pay an interest after the money has been borrowed. In
the state of things, the question alluded to, to be fair and within the
pale of common sense, must mean nothing more than this: _Would it not
be better, that the proprietors of the two millions interest, paid to a
foreign nation, should make their residence in England?_ And in this case
it leads us, by degrees, to the following query: _Would it not be better,
if all and every man in the world, who has money to spare, should come to
spend it in London?_ Then indeed _London_ would be a dear place to live
in! And this is, methinks, the most dreaded effect arising from taxes.
_O ye, whose covetousness knows no limits but the bounds of the earth!
do ye pretend to be the sole inhabitants thereof?_ Can ye draw off the
capitalists of a country, without completing its ruin? Can ye effect its
ruin, without losing both that portion which the produce of your soil
secures to you in the produce of that nation’s industry, and the share
which the produce of your industry has secured for you in those of her
soil?
What then appears to me to be the result of this _fatal_ interest of
two millions due annually to _Holland_?—That the latter is essentially
interested, not in an increase of the power of _England_, who might
make a bad use of it; not in an increase of specie in _England_, which,
by lowering its value, must compel her to return that of the _Dutch_,
already so much disparaged in their country; but to a further extension
of the _English_ trade, or rather of the general commerce, which can
alone, by advancing constantly, and every where, the quantity and price
of the objects that are to circulate, increase in the same proportion the
necessity of the _instruments_ indispensable to every kind of circulation
and undertaking, and keep up in every part, _for the interest of Spain
and Portugal, as well as for that of Holland_, the value of the sign
intended for a general representation, which _Holland_ in her proportion
will ever have in greater plenty than all other nations, thanks to the
narrow limits of her territories, and to the manners of her inhabitants,
which, in all probability, are the consequence of that limitation.
_Balance of ~France~ with ~England~._
Of all the balances of _England_ summed up by Sir _Charles Whitworth_,
that which is most to be wondered at every where but in _Japan_ and
_China_, where foreign trade is but poorly encouraged, is the balance
between _England_ and _France_, these two nations being parted, as they
are, only by a simple brook.
The wonder cannot but increase, if we consider with what eagerness those
two countries are intent upon improving their trade.
The wonder will still increase, when it is observed, that the _French_
carry to the highest pitch their rage for _English_ modes, whilst the
_English_ experience the same kind of frenzy for _French_ fashions.
The wonder must increase still further, when it is observed, that the
same nations, in possession of the most active and most intelligent
industry, are also possessed of all the cash necessary to give an
additional activity to that _industry_, which might be required to carry
on a branch of trade, as it were, at their door, but which is neglected,
out of regard for old and absurd prejudices.
Still must the wonder increase, if it is observed, that a first capital
of 200,000_l._ laid out in that trade by the two nations, would occasion
in both, more work in cultivation, as well as in the arts, than
600,000_l._ which each of them might employ in a trade to _China_, if it
were possible to lay out such a sum upon it?
The wonder will be still greater, when we consider that, _by favouring,
with equal care, the imports and exports to and from one country into the
other, the two nations would, without the least inconvenience, acquire
the means of increasing the revenue of their customs respectively,
according to their wants, by agreeing mutually upon a tarif, which would
be rated upon the average of those wants_; a tarif, which the rest
of _Europe_ might adapt to its circumstances, if it were the general
intention to increase, every where, the revenue of the State and the
industry of the people, in a like proportion.
This is certainly what the two nations might have compassed. That which
follows, is what they have done.
In the year 1699 the exports of _England_ to _France_ amounted to
287,050_l._ and her imports from _France_ to 94,641_l_:—
In 1773, the period at which Sir _Charles Whitworth_ closes his
statements, the exports from _England_ were rated at 285,776_l._ and
the imports from _France_ at only 44,484_l._—On this the enthusiastic
admirers of the Balance _in favour_ bless their stars that their country
imports now 50,157_l._ less in _French_ goods, than it did in 1699, and
that, in order to secure this advantage, _England_ experiences no other
damage than that the _French_ are fallen in their imports from _England_
only 1274_l._ since the year 1699.
_Further Reasons why all Ideas of a favourable Balance in Money,
different from that which I have supposed, should be rejected._
_Great-Britain_ is not the only nation that claims a right to that kind
of _favour_, which would reduce all _Europe_, in all transactions, to the
use of paper-money; but I only speak of _England_ in this place.
Money is not hid under ground in a country where administration is
convinced, both of the impossibility of the people paying exorbitant
taxes, without proportionable riches, and of the impossibility of being
as rich as is requisite for the discharge of enormous taxes, when
individuals are compelled to appear less rich, that they may be less
burdened with imposts.
Money is not laid under ground in a country, where the smallest sum, as
it were, equally with the largest, may be placed most securely, till
the very moment, when, led by fancy or want, one may think well to
withdraw it, and which, from the time when it has been placed, to that
of recalling it, produces nevertheless a sure interest, which never
was delayed a single minute; an interest, which is a matter neither of
reproach nor of shame.
Money is not laid under ground in a country, where the reputation of
being rich exposes not the subject to an arbitrary taxation, nor to
demands equally ruinous, to informations, extortions, or at least to some
injustice in case of a refusal.
Money is not laid under ground in a country, where regard is the
appendage not only of wealth, but of credit also, which carries the
appearance of, and can procure the former.
Nor is money hid under ground in a country, where it shews the value of
a man as positively as that of a piece of goods; in a country, where it
is frankly said, _this man is worth a million_; whether this expression
be made use of to signify that the possessor of a million is, at least,
by the whole extent of that million, far from being guilty of meanness
and injustice, or that it be understood that nothing but the offer of
another million could tempt him to commit anything base or unjust. Money
is never buried under ground in a country, where it acts so essential
a part; it cannot then be its fate in _England_: all the money in the
possession of _England_ stands in full evidence; it consists,—1st,
in objects of private luxury, the quantity of which is by no means
extravagant;—2dly, in the mass of cash in circulation. Now this very
_mass_ is despotically determined by the number of affairs transacted,
and likewise by the prices and quantity of the property which is to be
circulated; yet this mass is, perhaps, in _England_ one half less than it
would prove any where else, supposing the same objects to be attained;
that universal _mobile_ is too justly appreciated there, to be lavished,
that is to say, to be _turned into cash_, beyond what is required to give
credit to the paper currency substituted to _cash_.
I shall therefore ask, In what public funds abroad the _English_
merchants vest annually the four or five millions of that pretended
_favourable_ balance in money, since they do not bury it at home?—There
might, it is true, still exist another resource; the general balance is
only the aggregate of all private balances.⸺But is it very certain that,
upon an average, the private balances of all the merchants in _Europe_,
who correspond with _England_, are annually charged by one fourth of
the amount accruing from that correspondence? For if the _English_ send
them 16 every year, and every year import only 12, their correspondents
are consequently indebted to them annually 4 more than they were the
preceding year.
The _favourable balance_, as it is commonly understood, is then a mere
chimera, which, if realised, would produce no other effect than to
advance, at some period or other, the price of a pound of bread to that
of a pound weight of gold; yet it results, methinks, from the exports
of _England_, almost trebled within a century, that each nation, with
whom the former has trebled her trade, has increased her own, at least,
by the whole amount of the balance due by her to _England_; for it is
beyond a doubt, that one must have three times more to sell, in order to
be able to purchase constantly, and pay three times more than he used
to do. But from this principle may it not be inferred also, that every
nation, wishing to increase her trade, is interested in an increase of
the commerce of all those with whom she means to correspond?—If, in
order to reduce into practice, if to establish on the most equitable and
most solid foundation, a system so truly advantageous to society, Nature
had nothing more to combat than private _cupidities_—they balance each
other. But how many national prejudices, how many maxims sacred to each
nation, how many absurd regulations, springing from those very maxims and
prejudices, is she not obliged to modify, as it were, underhand, in their
effects! What a number of smugglers does that good mother employ, for the
purpose of bringing all things nearer to that _equilibrium_, from which
many are still persuaded it is so very material to deviate!
_Equilibrium necessary in all things.—On the surest means of establishing
it._
It is a difficult matter to guard against a prejudice in favour of
liberty, when we consider, that, thanks to the freedom which has always
very generally prevailed in those parts of Science, wherein policy
disdained to restrain it, we have been taught to weigh air, before any
precise idea was obtained on the rule of proportion, which ought to
regulate matters of exchange. Every thing, in this last particular, is
even still merely mechanical; and perhaps if the matter were thoroughly
examined, it would be found that there is never too much, nor too little
in one of the scales of the balance, but from an effect of the means
devised to establish or preserve the Equilibrium. I do not pretend to
lay down, for an absolute principle, that the hand of man, like that
of the harpies, is only capable of poisoning whatever comes within its
reach, and that the wisest conduct would be, to keep it with care from
every thing that one should wish to preserve from corruption; such a
proposition would, no doubt, prove rather too general; yet one cannot
help observing, that there are but few countries where administration
has not often, owing to the grossest ignorance, or some principle of
injustice, or of a cupidity almost equally blind, restrained some very
lucrative _cultures_, to which the nature of the soil and of the climate
would have given a perfection that could be attained no where else; or
have not encouraged some costly produce, to which Nature refuses those
qualities which she liberally bestows under another sky.
Neither can one refrain from remarking also, that from those regulations,
and from many more of the same kind relative to manufactories, no other
effect can result than that of buying up at home, very dear, and often of
a bad or indifferent quality, that which might be purchased abroad of an
excellent kind, and at a cheaper rate, and which might be paid for with
the productions of the earth and industry, better suited to the climate
of the purchaser.
It is also observed, that, without the interference of administration or
of philosophy, the balance between want and the relative quantity of the
different productions of the earth, is always, upon a medium, admirably
supported by the sole interest of the cultivator, ever perfectly and
solely guided by the common demand for each of these productions.
It is also remarked, that a second balance, and a very necessary
one, between the mean price of those different productions, is also
mechanically established, on the difference of labour and of the
capitals, which the same cultivator lays out upon each of them, without
any other motive but that of employing with discernment, his hands and
his capital, to derive from them the greatest benefit. He never thinks of
restoring the equilibrium between the general prices, when the price of
the product A has fallen, and when a continued advance on the product B
invites him to multiply the latter, by transferring to its cultivation,
a more considerable share of his labour and of his capital. Nor does he
think of it, when laying out new supplies of labour and money if the
price of the product B keeps up whilst that of the product A goes on
increasing; he does not think of it; and yet, without any other reason
or motive than his own interest, he restores that necessary equilibrium.
Much less still does he think that an increase maintained in the price
of one object, without diminution in that of other articles, bespeaks
an increase of the general consumption, which soon must raise the price
of every thing. Nay, it is very probable that he will not take notice
that he _sells_ all his goods at a higher rate, and that he will soon
complain of the general advance in the price of all those which he buys,
because his interest is his only guide: but this interest is opposed by
that of industry; and from this clashing, in spite of the two opponents,
arises a new balance, more loaded, no doubt, than the first, but not less
necessary, not less equitable, and yet no one has meddled with it.
All these things may be easily observed; but what ought to be more
particularly attended to, and what is most overlooked, is the
impossibility of ascertaining the difference between the hand-labour and
capitals to which we owe the productions of the earth, the knowledge of
which is within the reach of every one, and the labour and capitals
to which we owe the productions of industry, in which the workmanship
of an article often constitutes the half, and sometimes 99 hundredths
of its value: it is a disadvantage against which agriculture cannot be
effectually protected but by a competition, which can be the result
only of the greatest freedom. The absolute _passiveness_, which, in the
above stated circumstances, is sufficient, on the part of Government, to
effect the greatest good, appears here indispensable, to avoid acts of
injustice. Why should the trading part complain of that _passiveness_,
whilst a number of cultivators, proportioned to that of the artisans,
produce in the State a revenue equal to the maintenance and support of
industry? Now the fact appears the more certain, as, upon the least
reflexion, one may be sensible, that if an epidemic disorder should break
out amongst the husbandmen only, and thus deprive cultivation of one half
of its proper number of hands, the survivors would not fail to increase
the price of their labour, and the farmer that of his farm, by so much as
would indemnify agriculture for the loss which she might have sustained,
and that the advance in her prices would fall off only in proportion
as the handicraftsmen without employment, by the uselessness of that
portion of the produce of industry, hitherto consumed by the cultivators
who fell victims to the disease, would themselves turn cultivators; an
operation which would soon restore the proper balance between the two
revenues, as well as between the prices of labour, from which all kinds
of produce originate. Let the effects of the disease be transferred from
the cultivators to the handicraftsmen, the same manœuvre will be played
off by those who preside over industry.
Should another reason be wanted to strengthen my argument in its
most essential part, I could adduce an incontestable fact, as little
controverted in _France_ as it is in _England_, namely, that in both
countries the whole of the landed property does not yield three fourths
of what it ought to produce.—Then, either the respective industry of
the two nations ransoms agriculture, and binds her up, without being
suspected of doing so, to that state of mediocrity to which she is
reduced; in which case, single out of your regulations, those which
favour industry at the expence of cultivation, and endeavour to expunge
them, since agriculture stands clearly in want both of hands and
capitals; or your industry and agriculture are neither of them nearly
arrived to that degree of perfection which they are calculated to reach;
that is to say, you have not the number of cultivators which your land
can nourish, nor of course, so many artificers as your land can maintain;
in this case also, revise your regulations; there is not one of them
which does not affect your agriculture in a direct or indirect manner; by
her you must begin: cultivators, unthinkingly and without regret, give
birth to a race of artisans;—it is, on the contrary, as it were in spite
of industry, and by a kind of reaction which she spares no endeavours to
retard, that cultivators are produced by artisans. _Never will industry
lay out a shilling upon the land if she can employ it in any other
enterprise._
But, would the inland trade, without which agriculture cannot subsist,
flourish, if foreign commerce should not be encouraged in a particular
manner? And were any circumstances whatever, combined together so as to
occasion such an alteration in the price of necessaries, as would deprive
industry of the proper means to support abroad a competition which cannot
possibly subsist but by an equality of means; would it not then become
necessary for government, to shew a special favour to commerce, intrusted
with the care of that competition? _The manufacturers, in all countries,
insist so forcibly on such a necessity! The ruling powers in every nation
are so convinced of the truth of the above maxim!_
This question, truly important, requires some details on the different
causes productive of the alteration in the prices.
Although I may often appear, in the following suppositions, to lose sight
of the revenue arising from industry, and pay attention to that of the
land only, we must not forget the mechanical principle, or rather the
force of Nature, who, sooner or later, in spite of all the subtilty of
man, keeps an exact balance between those two sources of national wealth,
and causes all the revolutions of the one to be unavoidably felt by the
other.
_Various Causes of the Alteration in the Prices._
As long as we shall suppose, in a country standing by itself, the same
products, the same consumption, the same quantity of money, the same
freedom, no reason can ever be assigned for an increase or falling-off in
the price of any article generally known, and of general use; but,
_Second Hypothesis_,
Let us suppose, that population is doubled as well as the revenue; no
alteration can certainly take place in the real value of things;—that
value will remain for each article, the same as it was before; that is,
_the sum of the labour requisite for the production of that article_:[5]
neither will the relative value undergo any change; the quantity of
labour known, or supposed, in two different objects of a certain
consumption, will remain, as at first, the sole criterion for fixing the
difference of value in the one and the other. The essential relation
of general correspondence between the wants, and the real resources,
remaining also the same, there can likewise be no real difference in
the situation of any individual whatever; if there are every where two
_consumers_ to one, the same increase will be found in the number of
_productors_. The only palpable, and unavoidable alteration, always
grievous when it is sudden, is that which, in the present hypothesis,
must have taken place in the nominal value, that is to say, in the
money-price of every thing; for the quantity of coin which was in
circulation, being always the same in that country, standing by itself
as we have supposed, and without mines, whilst the objects representing
the said quantity, had successively doubled, it had been indispensable,
successively, either by degrees, or by starts, to come to the point of
giving for 2 in money, that which could not be given before for less
than 4, or rather of denominating 4, that same quantity of money which
hitherto had been denominated 2.—If you look for a precedent of the
first effects of a disproportion too considerable or too rapid, between
the wants and the demands, or between the mass of coin in circulation,
and the number of articles to be circulated, it will be found, in the
revolutions which took place in _England_, during the space of two years
_only_, 1288, 1289, the quarter of wheat rose from 1_s._ to 2_s._ then
to 3_s._ 9_s._ 12_s._ came down again to 2_s._ was then raised all at
once to 20_s._ and fell at last to 16_s._ where it seemed to support
itself for some years (see the excellent _Inquiry_ of Mr. _Smith_, _into
the Nature and Causes of the Wealth of Nations_); this is the man truly
capable of dissecting, as it were, that subject, of which I can, at best,
but mangle the _epidermis_.
_Third Hypothesis._
To remedy the evil in such circumstances, how many expedients are tried,
which only serve to increase it! How many avowed depredations upon
pretended usurers, before the Sovereign boldly ventures to partake with
them in the public execration by ordering a re-coinage, which, under the
same denomination, will give but a part of the weight, or of the quality
of the former coin! Yet this cannot be avoided. But by ascertaining, as
we have done before, a two-fold increase in the revenue, and supposing
one million and a half to have been sufficient to the circulation of
the first revenue; if the Prince with his 1,500,000_l._ instead of a
coinage of three millions, should have struck only 2,400,000_l._—after
some fluctuation, the balance will be restored between the price or
nominal value of the negociable articles, and the quantity of money in
circulation;—but what had been sold for 5 heretofore, will then go for
4; the prices will have fallen one fifth, and the circulation will be
clogged:—But above all, it should be observed, that _no one will be the
poorer, notwithstanding the diminution of the nominal value_.
_Fourth Hypothesis._
If the re-coinage has been in the proportion necessary to re-establish
exactly the former facility in all the channels of circulation, the
former prices will return after the inevitable fluctuations; the quarter
of wheat, for instance, which at some period of the revolution, will have
been raised to 20_s._ will fall back to 5_s._ as it was at the beginning,
although the shilling contains only half the silver that it contained
at that time, 130 grains we shall say, instead of the 260 or 264 it
contained in the year 1300.
_Fifth Hypothesis._
Now let us suppose, what has happened in all countries, that the Prince
and his Ministers have laid hold of the opportunity, the former, to pay
the debts he had incurred in the time of national distress and confusion,
the latter, to procure a more rapid increase of their fortunes, and
that, with the 1,500,000_l._ supposed in circulation, they have struck
6 millions, instead of the 3 wanted to answer the real increase of the
revenues and of population;—certainly when the calm returns, 10_s._ will
be the price of a quarter of wheat, which sold for 5_s._ in the _first
hypothesis_;—a most decisive argument this, for the manufacturer to sell
at 8 that very cloth which went for 4, and an uncontrovertible ground
of right in the working people to charge 4_d._ for that which before
they performed at 2_d._—In these two points center all the practical
inferences in which any individual in the State can be concerned: yet the
shilling will contain only 65 grains of silver, instead of 260;—and if
the price of every thing be doubled, it is not on account of the shilling
containing only 65 grains in lieu of 260, since, upon this principle,
the quarter of wheat must have fetched 20_s._ instead of 10_s._—but it
is because, in all cases, there are two pieces of money to answer the
purpose of one, and that _it was necessary, in order that the second
might acquire one half of its former value, that the first should lose
that very half_.
_Sixth Hypothesis._
At this period, let it be supposed, that an epidemical distemper sweeps
off three-fourths of the inhabitants, and consequently takes away as
much from the revenue:—After the terrors usual in such cases, and a
score of prophecies, foretelling that Doomsday is at hand, yet will it
appear that the world is not destroyed: it will also appear, that the
epidemical disorder has not carried off the money, and that it would
be wrong not to make use of it.—The specie must of course, lose nearly
three fourths of its value if the whole should continue in circulation,
because 4 pieces will present themselves to do the office which 1 could
perform before the time of the distemper;—the quarter of wheat, at first
rated at 5 shillings, sunk to 4 in the _second hypothesis_, then sold for
10 in the _fifth_, will in the present one, rise up to 40, _without any
one growing richer or poorer for it; for_, most assuredly, _the price of
labour will have increased in proportion to that of its own produce_.
_Seventh Hypothesis._
The effect would have been the same, if, instead of the distemper just
supposed, the general enthusiasm on the discovery of a gold or silver
mine, had induced the Sovereign to add to the circulation three times the
quantity of specie which had hitherto been sufficient.
_Eighth Hypothesis._
In the supposition of an event the most opposite to that of an epidemic
disease, viz. of the revenue being increased one half, one third, nay,
three fourths, if you please, as well as the population; yet the mine
yielding a great deal above what is necessary to answer to an increase
in all kinds, and the Sovereign being resolved upon a recoinage of the
specie, on principles entirely different from the former, that is, by
preserving exactly the same number, standard, and denomination of the
coin; the number, because it is sufficient; the denomination, because
there must be one, and that it is indifferent which it bears; and the
standard, because there is no further danger in fixing it; but, by
advancing the weight of a shilling from 65 to 86 grains, there will
certainly be no alteration in the prices; the wheat will keep up at 40
shillings, and other articles in the same proportion;—and _none will be
richer or poorer for it_, although, at the price of 40_s._ the quarter
of wheat, they give, without hesitation, 3440 grains of silver for an
article for which they gave 650 only, previous to the epidemic disease,
or the opening of the mine, which has produced the same effect.
_Ninth Hypothesis._
When such revolutions are brought about by slow degrees, no one is
sensible either of the effect, or of the cause; but, at last, both are
attended to. Let us then suppose, that the generality of the people
reflect that gold and silver, considered as coin, derive all their value
from imagination;—that money is, strictly speaking, nothing more than
a medium adopted to facilitate the division and transport of all other
kinds of property;—that it is but a sign, the place of which may be
easily supplied by any other, which by general consent may be honoured
with the same distinction, or ordered for the same use;—that its value,
in this point of view, rises or falls unavoidably, according to its
quantity, _without influencing the intrinsic or relative value of the
articles it represents, a value constantly determined by the sum of the
labour that produces them_, just as their relative, _common_ quantity
follows, servilely and closely, the demand.—All these remarks cannot
prevent us from observing a value far more essential in gold and silver,
considered as metals susceptible of all the forms that can be useful,
or can please the eye, while the nature and texture of their parts
secure them from accidents equally disagreeable and dangerous, to which
all other metals are liable: we should not therefore be surprised, if
some reflexions, suggested by wisdom and humanity, were to lead us to
that point which first originated in the extravagance of ambition, and
the rage of politics; I mean, that, after having considered that no
manner of good was produced by that disparagement of coin, which always
resulted from its multiplication, and that the health of man was, on
the contrary, interested in putting to a better use those metals, the
quantity of which, being doubled in circulation, only served to double
the price of every thing;—we should not be surprised, I say, not only
that nothing was spared to encourage the goldsmith’s trade, but even,
that half of the coin was melted down, and transformed into plate, and
the _deficit_ supplied by a quantity of _paper-currency_, answering to
that of the coin thus employed; a _paper-currency_, which it would be
sufficient to distinguish by some mark or token agreed upon, to give it
in circulation, exactly the same properties as that part of the metals
which was transferred to a more advantageous purpose.
In regard to the danger of paper-currency increasing above the quantity
wanted, it is as little to be feared, and its superabundance would soon
be made as sensible by its effect, as that of a superfluity of coin.—If
you double the mass of money intended for circulation, how will you
prevent such articles as sold for 4 only, from rising to 8, or the
additional 4 from becoming useless?—And if paper-currency be in question,
how will you prevent the extravagantly-avaricious wretch, who envies
others the enjoyments he denies to himself, how can you prevent him, I
say, from observing that paper rots in the ground, and that to bury his
wealth he must exchange it for cash?—how will you prevent this want of
money, immediately felt, from destroying, without resource, the credit
which that mass of buried money had hitherto given to paper-currency? So
long, therefore, as the paper keeps up its credit, one may rest assured
that the public is not over-loaded with it. I shall, in the sequel,
venture some reflexions on the true cause of that part of the increase
in prices, which is attributed to the quantity of paper-currency in
circulation; contenting myself here with a recapitulation of what I have
just said on the different causes of the alteration in prices, according
to the foregoing hypothesis, by concluding,
First, That a nation which should rejoice in being possessed (for the
convenience of covetous individuals) of a _vortex_, into which they could
cast, at pleasure, without profit, but also without anxiety, an immense
treasure, which was the produce of the pains taken by so many useful and
industrious hands, would, in fact, only congratulate herself on being
possessed of the effectual means of robbing the present and succeeding
ages, of all the advantages that must have accrued from the use made of
that money, _in any part of the world_, where it might have produced,
and encouraged a new branch of industry, _the reaction of which would
have turned to the profit of the nation in possession of such ~vortex~._
Secondly, That a nation, which should rejoice in being the owner of an
immense quantity of coin in circulation, would, in fact, congratulate
herself on that want of credit which renders such quantity indispensable.
Thirdly, That as soon as government, in such a nation, should have
solemnly given up the right, supposed to be unalienable, of paying its
debts, from no other motive but that of extreme honour and benevolence,
the nation might then part with half her coin, and without impeding the
circulation, increase her enjoyments and her wealth, which can be nothing
more than _the total of her annual labour, together with the monuments
still subsisting of the labour of preceding years_: a total, which could
not but increase in the case now supposed.
Fourthly, That, in regard to the coin, the most wretched paper-factory,
assisted with that credit which is founded, not on kindness, but on
justice and interest, is far preferable to the richest mine in _America_.
Fifthly, That the difference in the real value between one article and
another, is only the difference of the labour which produces it; and
that _all regulation, tending to throw a veil on the quantity of labour
contained in one article, is unjust_; since it turns to the prejudice of
any individual in the community, _who is not the author of this unknown
labour_.
Sixthly, That the nominal price of the _essential_ article, to which
that of the others must finally revert and conform, fixed at first by
its proportion in the quantity of articles to be represented, and by the
divisions and subdivisions of the mass of money then existing for that
use, this nominal _common_ price will certainly rise or fall, constantly,
and _without the least inconvenience_, just as that first quantity of
coin shall cease to answer, by more or by less, to the quantity of the
objects of which it was calculated to transfer the property.
Seventhly, That, supposing it to be a fact, proved incontestably by the
mint-registers, and the average price at _Windsor_, that from the year
1300 to 1309, wheat, at its highest rate, was not above 7_s._ _per_
quarter, the shilling weighing 264 grains of silver, which made the
quarter come only to 1848 grains; that in the year 1551, the same sold
for 8_s._ the shilling containing then only 60 grains, which made it
exactly 160 grains _per_ quarter; and that the same sells now, I will
say, at 40_s._ the shilling containing 86 grains, which is 3440 grains
for a quarter of wheat; yet, from these facts no inference can be drawn
that could affect any individual whatever, unless it should be proved,
that money makes part of our food, or that it is impossible, at this
present time, to procure, with any _given_ labour, more or less wheat
than that identical labour could procure at that period.
Eighthly, That the _real_ difference between 1848 grains of silver, and
3440, which is perceivable between the prices of the years 1300 and
1785, would not even be sufficient, were it considered by itself, to
invalidate, or confirm this futile proposition, that the mass or stock of
money is nearly doubled in _England_; for we have already found, that,
supposing the case of an epidemic distemper, which would have carried
off three fourths of the people, and consequently reduced the revenue
in the same proportion, the price of every thing must have increased
fourfold, if the three fourths of the coin had not been buried under
ground; we have seen, on the contrary, that it has been possible to
withdraw from circulation half of the current cash, and make good this
substraction in a very advantageous manner, by introducing scraps of
paper in its stead, without making any alteration in the general prices,
or in the least affecting the circumstances of any one, poor or rich,
unless some collateral incident should intervene to bring about a change;
and the least reflexion will convince us, that the mass of specie might
be quadruplicated in a nation, without any material variation in the
prices, _if the sum of labour, and of its products, as well as of the
consumption, should augment proportionably_.
But, in stating that the only—the infallible reason for the variations of
_common_ prices in the foregoing hypotheses, is the change of proportion
between the mass of specie, or of the paper-currency which represents
it, and the articles of which the one, or the other, is to transfer the
property, there is no inconsistency in persisting to pretend that taxes
add to the former prices, both the amount of the impost, and the profit
due to the trader who advances it. But, in both cases the progress is
different: in the former, it is the quantity of the specie actually in
being which necessitates and fixes the prices; in the latter, it is the
necessary advance in the prices, that _necessitates_ and _fixes_ the
quantity of specie, or paper-money which is substituted to it.—Luckily,
as we have already observed, it has been enough for _England_ to find,
once for all, money to the amount of 5 millions sterling, (cash and
paper) for discharging to the end of time, the interest of a debt
computed at 238 millions, the same currency.—But upon a supposition
that the debt incurred by _France_, from the year 1774, should amount
to 15 or 1600 millions _tournois_, and the yearly produce of _French_
industry in all its branches, (at the common rate of 1775) be of
2,400,000,000_l._—the interest of 80 millions and upwards, to be paid for
such a debt, requires an adequate increase of taxes:—now, 80 millions
_tournois_ constitute about the 30th part of the annual revenue produced
by _French_ industry, the nominal value of which must be increased by
those taxes;—but as paper-money does not supply in _France_ the place
of cash, it has been, of course, necessary to augment by one 30th,
the mass of specie, which proved sufficient before the rise in the
prices, occasioned by the impost;—this mass, it is said, was rated at
2,400,000,000 of _livres_, the 30th part of which is 66,666,666 13_s._
and 4_d._ _tournois_, a very considerable sum indeed; but nevertheless
nothing more has been necessary, to prevent any inquietude on the
subject, than to procure that sum, once for all; and, _once for all
likewise_, to add thereto the effect of some re-actions, of which I
shall speak presently; nothing more, I say, was wanted to secure, in
an indefensible manner, the interest of a loan of 1500 millions, and
to secure it so as to raise in the minds of the holders of stock to
so immense an amount, no other apprehension than that of their being
reimbursed.
Some will say, perhaps, “this reasoning is frivolous, and founded on
the absurd supposition of a general combination, a kind of universal
conspiracy, in order to raise the price of every thing proportionably
to the _taxes_.” I know that such a combination, such a conspiracy is
impossible; I know that there is not in _France_ a single edict, nor
any particular act of parliament in _England_, to enforce, or even to
permit it; but I am sensible that such an act, and such an edict, would
be perfectly useless, when I see, that in either of those countries there
is not a rational being, capable of reflexion, who will not say, _Taxes
occasion a dreadful advance in the prices of every thing_: it is true
that the order is sometimes inverted, and then the cry is—_How cruel
it is that the price of every article is increased, whilst the taxes
diminish our means of purchase!_—But if every article rises in a due
proportion, we must conclude that there is no alteration in the state
of the balance; for if every individual in a nation buys up, every one
sells also, one his labour, another his wares, a third his corn; and if
every thing grows dearer, except the article you have to sell, you must
own yourself completely in the wrong: luckily the landed proprietors
are as little in the wrong as they possibly can be; for as often as
they renew a lease, they increase their rental, just as if they had got
possession of my _little_ secret, or as if there were _corporations_ also
in agriculture.—The agents of industry are still less liable to be in the
wrong, for all their operations are founded on the following rule:—_For
purchase so much,—for freight so much,—so much for taxes,—to these add my
commission or profit—The balance is so much, which I must be paid, as I
shall settle with the members of my corporation._ Besides, the commercial
part of the nation is too well persuaded how necessary it is to secure _a
favourable general balance_, to be mistaken in the means of equipoising
their private ones.
It is my opinion, therefore, that one may, without being a conjurer,
foretell that the last dreadful and convulsive shock, almost generally
felt all over the world, will finally, and in a very little time, end in
the loose remembrance of some thousands of hands having been, foolishly
enough, taken from their peaceable occupations, very favourable to
population, to employ them in forwarding destructive plans, to which
many thousands of men have fallen a sacrifice; one might also add,
thousands of depredations, some of which, the most pardonable in their
nature, have been punished at the gallows: perhaps even they will say
modestly in _France_, _We have reduced the English, but we were four
to one_—and then _England_ will proudly answer, _We have been reduced,
but we were only one to four_; nor would it be at all unreasonable to
lament, that the value of 4 or 5 millions sterling in gold and silver,
fatuously ornamented with the escutcheons of _England_ and _France_,
_to consolidate for ever the interest of 140 or 150 millions, which
constitute the last debts contracted by the two rival nations_, be
not humbly stamped with the puncheon made use of to mark the plate in
_London_ and _Paris_ ... but, to suppose that there will be in _London_
or _Paris_ a single carriage less! that _France_ will lessen her
importation of _English_ goods, or that the demand for _French_ wines
will be less from _England_—is an idea which cannot, in my mind, coincide
with that of a population and industry which, hitherto had sufficed in
both nations to answer all those different purposes; of a population,
I say, and of an industry, which will, in all likelihood, go on still
increasing every day, wherever they shall not be checked by the laws.
One of the most fatal effects that spring from that increase in the
prices, occasioned by the impost, is, as they say, the impossibility
to which a country is reduced, of supporting abroad the rivalship, the
competition of a nation less burdened with taxes, who of course can, they
say, undersell every thing.
Such is, in fine, the question which I thought the fastidious details
I have entered into, ought to preface, and might render of more easy
solution. But I request the reader to examine previously,
1st, Whether an accession of wealth, an addition of gold and money to the
circulation, would not increase the prices of every thing, as necessarily
as taxes must do it;—2dly, If that increase in prices, procured by
wealth, would not be accompanied with the same inconveniences in regard
to the supporting of a competition abroad;—and, 3dly, If the stranger to
whom we should declare ourselves compelled to sell him our goods dearer,
_because we are grown richer than the rival nation_, would not have
the same answer to give us, as if he were told, _that the cause of the
advance in the price is, our being loaded more heavily with taxes_.
If these three questions cannot be answered but in the affirmative, we
should then be obliged to suspect that there is something inexplicable,
ill judged, and not better grounded in the clamours which resound in
every part of _England_ on this subject; and this surmise might perhaps
incline the reader to peruse, without prejudice, what I am going to set
down, with no other view, than to find out some useful truths.
_On the Influence of the National Prices on the Sales in Foreign Markets._
The impossibility of a competition in trade with those who can afford
cheaper, _in money_, the articles which are to be the object of such
a trade, is so affirmatively maintained, and this principle is so
self-evident, when applied to two manufacturers in the same town,
circumscribed in their selling as well as their buying, within the
precincts of the same country, where the one should always procure for
3, what the other would have the stupidity to buy constantly at 4, that
it becomes pardonable (if one carries the examination no farther) to
admit of this idea, taken in a most comprehensive manner, as one of those
trivial truths, which are not worth being searched into. But I must own,
that my reflexions on the pretended necessity of keeping the commercial
balance constantly in _favour_, have made me rather circumspect in giving
credit to opinions the most generally received.
It will not be in regard to the situation of a country, which might
allege a difference of 7 or 8 _per cent._ in its prices, as an
insurmountable bar to competition, that I shall examine in what manner
that very competition might be established; I shall suppose a nation
in the 6th, 7th, and 8th _hypotheses_, wherein wheat is rated at
40_s._ _per_ quarter, by a series of revolutions in the coin, or a
multiplication of taxes, or by an increase in wealth; and I shall place
it in opposition to another nation, considered as paying few or no taxes,
and humbly consuming her wheat at the rate of 26 or 27_s._ the quarter.
In order to render the effects of the disproportion more sensible,
I shall further suppose, that the shilling in both nations equally
contains 86 grains of silver at the same standard.
Before these two nations be represented as vying with each other in the
foreign markets, I shall, in the first instance, examine, whether it
might not be possible to settle between them a direct trade, equally
advantageous to both; for if this be practicable, why should not the
competition be so likewise?—Is not the trade of each competitor a direct
one with the nation, in which he vies?—And if, in this case, there be a
sure and equitable principle for one of the competitors, why should it
not be so for the other?
_A necessary Principle of Trade, considered both as ~direct~, and ~in
Competition~._
In all imaginable suppositions, Commerce is nothing more than the
exchange of one want against another want, or of one fancy against
another fancy; or, in fine, of a fancy against a want. All idea of a
commerce between two nations, as between man and man, carries with it
two objects different in their nature, or their form; and the relative
value of these objects must essentially be previously determined by some
general principle, if we mean not to transact business in the dark.
Now, the nation so rich, or, in other words, so over-loaded with money,
as to have raised, at home, the quarter of wheat to 40_s._ can certainly
have no real interest in taking away the small portion of the other,
so scantily provided, that she is obliged to sell for 24 or 27_s._
that which fetches 40_s._ to the former; for, after all, what would be
the consequence of this spoliation? It would serve only to lessen, in
the opulent country, the value of the precious metal already so much
disparaged there. What then will be the case, if both have sense enough
to prefer real enjoyments to chimerical possessions, or rather, profit to
loss?
After the first years, destined, since the establishment of Societies,
to be spent in endeavouring, if possible to cheat each other, it
will certainly become indispensable to agree upon a fixed rule of
appraisement, as unexceptionable for one country as for the other. Now,
in the supposed state of the question, money cannot be that rule; for
one of them demands none, and the other is not willing to part with any,
not out of regard for the _favourable balance_, but because she would
get less by the exportation of her money, than of her goods; it will
therefore become necessary, for the respective advantage of the parties
concerned, to agree, that the labour of 10, of 100, of 1000 men in one
country, shall be looked upon as repaid by the labour of the same number
of hands from the other, upon a tacit proviso nevertheless, that the
respective merchants in both nations shall have it in their power to
ransom their countrymen, according to the proportions established in both
countries, _a little_ by the degree of estimation in which commerce is
held, but a _great deal_ by the degree of foreign competition by which
the natives are or will be kept or called to order.—And what is required
to prevent any injustice, and, above all, any mistrust from the merchant
of one nation towards the merchant of the other?—Nothing more than to
follow the practice almost generally established all over _Europe_.—The
merchant in _Rome_, I suppose, will send his son to his friend in
_London_, and _vice versâ_. Now if the _Roman_ perceives that in
_London_, where a quarter of wheat costs 40_s._ the article he proposes
to buy is commonly sold at 80_s._ he will readily conceive, without
having gone through a course of algebra, that some other article, which
is bespoke of him in exchange, going for 54_s._ in _Rome_, where wheat is
at 27_s._ _per_ quarter, he will exactly pay, value for value, according
to the balance and weight of the commercial sanctuary, the 80 of _London_
with the 54 of _Rome_.
It appears to me that matters thus settled, might remain so for ever,
without inconvenience, without any alteration of prices, in either of
the two nations, had not Nature, either from mere caprice, or to make
men, in spite of themselves, dependent on each other, and oblige them to
look on one another as brethren, established certain unknown rules, in
consequence of which, that very same wheat, which would cost only 26 or
27_s._ at _Rome_, we have supposed, and 40_s._ in _London_, this same
wheat I say, the staff of life all over _Europe_, every where accounted
the standard of labour, and every where cultivated in proportion to its
common necessity, is at times nevertheless at one place in great plenty,
and very scarce at another. Now it seems to be a matter of perfect
indifference, that in regard to any other article a merchant should
ransom his wealthy fellow citizen, a landed proprietor, by charging
him, for instance, 30 crowns for an _English_ trinket, originally
purchased for no more than 10, as an equitable measure between labour
and labour: it is the younger son who robs the elder brother, to provide
against the right of primogeniture; or, in other words, it is no more
than the transferring of a few crowns, from a very valuable hand, that
of the consumer, to another equally precious, that of an agent of the
production: but it is of the utmost consequence for the Sovereign, that,
in a time of scarcity, insatiable men, were they even his subjects, do
not presume to ask 4000 grains of silver for a quarter of wheat, upon
pretence that in _England_, from whence it was imported, they have paid
for it 3440 grains, (for it is always upon such _victorious arguments_
that the national monopolist endeavours to defend his extortions, in
times of distress); the difference is so great between 4000 grains
of silver, and only 2200 or 2300, the common price by which that of
labour is regulated in my hypothesis, that all the treasure shut up
in the castle of _St. Angelo_ could not prevent half the inhabitants
from starving for want of food in a time of dearth. Luckily, however,
this misfortune may be obviated by one of the grandest operations in
finance, that can possibly be conceived; for the object is no less than
to oblige the people to pay in good earnest for their wheat in a moment
of scarcity, at the rate of 4000 grains of silver _per_ quarter, a price
so far above the means of that very people, to whom the intention is to
shew some favour. This financiering operation is founded on the following
remark, obvious to the meanest capacity, and perhaps not unworthy of
being deeply searched into by a judicious observer.
Were the wheat in _England_ to cost only from 26 to 27_s._ _per_ quarter,
the landed revenue, now called 63 millions, would, in fact, amount to no
more than 42; this cannot be controverted: in this case every thing would
be paid for in proportion, and certainly no one could gain or lose by it:
therefore if we invert the proportion, _i. e._ if the quarter of wheat
rise to 40_s._ at _Rome_, instead of 27_s._ and the other productions
of the earth and of industry rise in price in the same proportion,
as well as the labour by which they are procured, the revenue of the
Ecclesiastical State, which, in the present supposition, would be only
10 millions sterling, would swell suddenly up to 15 millions, without
any one being a sufferer.—When the question is, only to take a _nominal_
share in the most dreaded effects of the _English_ taxes, in order to
procure such an addition of wealth, and get rid, at the same time, of all
fear of scarcity, it would be very wrong to reject the expedient.—Money,
it is said, is wanted to carry on the whole circulation at that
rate;—but, in _England_, where, by a single nod, they attract money
from every part of the globe, do they not make guineas with paper?—Why
should they not, at _Rome_, make as many paper-crowns as are necessary to
facilitate a general circulation of the products there? These products
are so wisely raised in price from 27 to 40_s._ that the number of grains
of silver necessary to purchase a pound of wheat, made into a loaf, being
now nearly upon an equality in _Holland_, in _France_, and at _Rome_, the
national trader, whose business it will be to guard against scarcity,
_and the foreign merchants who will be invited to concur in remedying
the evil_, will no longer be able to add to the price of wheat, any more
than a reasonable compensation for his advance, trouble, risque, and the
quality of the service rendered: a compensation besides, on the extent
of which it will be much more difficult to impose upon the Sovereign, or
any one else, at least beyond a certain degree: to this advantage let us
add that of keeping the needy from the thoughts of destroying that wealth
which has been gleaned by former services.
In regard to the confidence necessary to favour that paper money, with
the same degree of value as that of _England_ has obtained, I confess
that I do not hesitate to suppose, that the paper-money of a Sovereign is
never deemed contemptible, but when an opinion prevails that he himself
will despise it; and I dare say (were I to be charged with a want of
modesty) that the public is too deeply interested in the inferences that
may be drawn from my arguments, for their consistency or absurdity not
to be very soon demonstrated: now, supposing them to be consistent,
I think it would be, _then_, beyond all possibility, even to imagine
a circumstance wherein the interest of a Prince could induce him to
dishonour himself. This great truth, generally acknowledged, could not
long remain ineffectual.—But this is not the matter in point.
The case in point is, to observe,
First, that, in the same manner as foreign coin is resolved into the
quantity and standard of the metals that compose it, in order to know how
much of the national coin may be given in exchange, just so all kinds of
foreign commodities are resolved into the quantity of labour contained
in them, or supposed to be so, that the quantity of national labour,
corresponding thereto, may be ascertained:
Secondly, that therefore, labour alone being the standard of value,
_labour_ is consequently the only _standard_ that can regulate the
exchanges between one nation and another:
Thirdly, that the national prices, or, to speak more properly, money is,
in fact, the most proper standard of labour between two manufacturers
in the same town; and that nothing but the misconduct and unrestrained
cupidity of the one, can prevent him from selling his goods at the price
by which the other clears a profit that satisfies him; but in each
country the common price of labour being arbitrarily determined by the
common price of the materials necessary to set the labourer at work, the
common price of wheat is, in fact, the measure of the common price of
labour in all nations:
Fourthly, that it is impossible a nation should be willing to barter a
greater quantity of its own labour, against a less quantity of the labour
of another; _and yet it is to such a degree of absurdity, that we must
reduce the supposed ~advantage~_ of the _dreaded_ competition:
Fifthly, that the liberty of exporting corn, even under its present
restrictions, makes, as it were, of all _Europe_, at this day, _only_
one family; that, on the whole, there is constantly as much of that
indispensable commodity as is necessary for all the family; but that
a man whose folly would be to trace out, describe, and acknowledge,
throughout every thing that concerns society in any essential point, the
stamp of an universal benevolence, determined to unite all men together
by their wants and interests if it is impossible to do it by more
disinterested motives, would not prove too inconsistent in a fit of that
folly which might induce him to suspect some marks of that stamp, even
in the bad seasons, in the storms which successively visit all the parts
of the world, make them all sensible of the necessity of such union,
and soon bring nearly upon a level, all the different prices of that
indispensable commodity, the cultivation of which requires, almost every
where, the same labour, or which, by its quantity, always answers, upon
an average, to the labour bestowed upon it:
Sixthly and in fine, that hence results the impossibility that there
should long subsist, in the prices of any thing, a difference capable of
making any competition whatever, formidable _to any man who will not be
so unjust as to wish and ask beads of gold for beads of glass, or, in
other words, to try in bartering, to obtain the labour of 150 in exchange
for that of 100 only_.
Let us suppose, nevertheless, that there should exist at this day, a
nation pretending to be formidable in her competition, and who should
only be, in fact, remarkable for her folly, that is to say, a nation so
very blind, as to endeavour to keep the price of her wheat under that of
all other countries; I agree that the labour of her artisans would be
rated in consequence, and that the produce of her industry might thus
be purchased at a lower rate than that of any other nation:—but what
advantage could she derive from thence in a competition abroad?⸺Though
she should denominate at home the sum of her exports, only _one million_
for instance, because she would call 100, the quantity of wheat, which
elsewhere would be called 150, how could she require less for her
returns than the other countries, who, by the price of their wheat,
would be compelled to call 1,500,000 that which she herself would call
1,000,000?—Would not this million represent, as really, the labour of
75,000 of her workmen (their families included), as if it were by her
denominated 1,500,000_l._?—Besides, the place where she has carried her
goods is not the end of her voyage; and it is so much more necessary
for her to obtain in return the produce of 75,000 labourers (families
included), adequate to what she herself has given, as being obliged to
carry those returns home, where every thing sells, in the _hypothesis_,
50 _per cent._ below the price they would fetch any where else, she
would lose in lowering the rates of her exports, all the fruit she might
expect to reap from her voyage.—This is what escapes observation. They
see nothing but money in commercial operations, instead of observing
that all the nations in _Europe_, neither do nor can require, and that
_England_ herself does not preserve more of it than _the sum necessary
to answer those five articles_ of which I have spoken in examining her
balance: I shall in the sequel bring some proofs, in addition to those I
have already given; but I think I have said enough here, to justify me
in _insisting_, that the competition can be dreaded by the unjust man
alone, by that man who wishes to sell the labour of 100 workmen as if
it were the labour of 150, and by that man, not less unreasonable, who,
compelled to sell his own goods 10 _per cent._ dearer, should refuse to
pay also 10 _per cent._ dearer for the foreign goods which he would ask
in exchange.—If that principle—a principle of the strictest justice, is
still unknown in _Europe_; as an _American_, I glory that it is not so in
_America_.
_Reflexions on a Letter from ~Philadelphia~, inserted in the ~English~
News-papers._
A Merchant of _Philadelphia_ offers to his former _Jamaica_
correspondents, (see _Morning Chronicle_ and _London Advertiser_ of June
24, 1785) to serve them, with all such articles as they may require, at
the current price of _Philadelphia_, only with the addition of freight
and the usual commission. In order to render his proposal unequivocal,
he mentions staves, and makes a calculation, by which it appears that
he could not land them in _Jamaica_ for less than 12_l._ 19_s._ 1½_d._
currency per thousand; he then adds:
“By this calculation it appears, that staves would come considerably
higher than they used to be in _Jamaica_ before the war: it is true they
are so, but it is owing to their being risen at _Philadelphia_ nearly 100
_per cent._ Of _course_, _Jamaica_ prices must be in proportion; _for it
would be unreasonable_ to expect goods of _Jamaica_ at the old prices,
when those of _America_ have advanced so considerably.”
I shall venture upon some remarks on the foregoing proposition.
First, The _Philadelphian_ has sense enough to feel, that the war must
advance the price of goods from the Colonies, in a due proportion to the
general increase in prices of all that is carried there. In _Europe_,
on the contrary, people are not only strangers to the idea of that
universal chain, but they are so convinced, or rather so persuaded,
that _the Colonies were created, and do actually exist, for the sole
pleasure and interest of their respective metropolises_, that no
imaginable means are spared to lessen the price of their products in the
mother country who receives them, in order that _this tender mother_
may sell them at a cheaper rate in the foreign markets; but, ye mother
countries! your colonists are also your children, foreigners are only
your brethren.—It must be owned, however, that the coffee, indigo, and
cottons, of _Jamaica_, _Grenada_, _Guadaloupe_, _St. Domingo_, &c. are
no more the _territorial commodities_ of _England_, and of _France_,
than the corn and other productions of those two kingdoms; and that the
arguments adduced in regard to the colonies, are, as _Montaigne_ says,
_of a piece_ with that by which they prove, that, THE CHEAPER THE CORN,
THE MORE BRILLIANT IS THE COMMERCIAL COMPETITION.—_Were not Nature by
her underhand work constantly fighting, with some advantage, against the
dreams of speculators, to what pitch of misery would not agriculture be
reduced in all parts of the world!_
Secondly, War has been productive, in the United States of _America_, of
the same effects which attend it every where else, viz. an augmentation
in the price of every thing.
Thirdly, The increase of nearly _cent. per cent._ assigned to the
staves, does not determine the general advance of _American_ goods;
the excessive, but instantaneous price of one article only, denotes an
extraordinary demand for that object, and the actual impossibility of
answering that demand; the level, so necessary in all prices, naturally
returns as soon as the medium of the demand is known, and has determined
the number of hands necessary to supply it: now it cannot be doubted, but
that the goods in _America_ must have advanced in price, much more than
any where else, because the expences of the Colonies have been, during
the war, relatively speaking, much more considerable than any where else,
considering the discredit inseparable from the precariousness of their
situation. But the difference between their inland _common_ prices, and
those of _Europe_, was so great (this will presently be seen), that they
may increase them enough to pay off the interest of their national debt,
and yet keep the _European_ prices at a distance.
Fourthly, The United States are now a foreign nation in regard to
_Jamaica_, which belongs to _England_; yet this consideration does not
render them so far unjust, as to shake off the burden of their taxes,
and fix it on the inhabitants of _Jamaica_; they only make them nominal
partners in that burden, (if the expression may be allowed), without any
inconvenience arising therefrom to either of the parties.
Fifthly, They have the true notion of an equitable trade, founded on the
continuation of former relations between goods and goods; a principle
from which I only draw inferences relative to the national debt, and
which suffices to destroy all the _hideousness_ of that phantom.
Sixthly, They do not pretend, with the _Europeans_, that the increase in
the national prices, can in any thing affect their exportation; but they
have found, that being obliged to sell dearer, it was their duty to offer
very frankly to pay also dearer for whatever they wanted in return.
Seventhly, They do not entertain the least doubt on what _seems_ to be
unknown in _Europe_, namely, that the real benefit of a voyage can be
found only in the price which the returns will meet with, when arrived
in the country where the voyage is to terminate.
Eighthly, In the union, and in the execution of these different points,
centers the little mystery, by means of which Nature has hitherto filled
up by slow degrees, and by which the _American_ proposes, without
thinking so to do, to fill up with more dispatch, those little _furrows_
of taxes, the very name of which is now a bugbear, but would cease to
be so, if the manner in which they are planned, imposed, and above all,
collected, did not prolong and increase the real and momentary evil,
which will ever be inseparable from them.
Ninthly, It is singular enough, that the _European_ cultivator should be
taught by the _American_ trader, _the necessity and the justice_ of an
increase of price in the _productions_ of the earth, _proportionable_,
says the honest _Philadelphian_, _to that which is to be met with in the
price of the productions of industry_:—_It would be unreasonable_, says
he, _to expect the goods of ~Jamaica~ at the old prices, when those of
~Philadelphia~ have advanced so considerably_.—Nay, say the _European_
manufacturers, since our goods, by means of the taxes, have increased
10 _per cent._ it follows necessarily that the price of wheat, sugar,
indigo, &c. should fall in the same proportion, in order _that the trade
in competition may be supported abroad;—had not Nature, by her underhand
work, constantly fought with some advantage against the dreams of
speculators, and against the much more dreadful surreptions of cupidity,
to what pitch of misery would not agriculture be reduced in all parts of
the world!_
The following estimates may be of some service; their utility is
independent of the absolute precision of the facts on which they are
founded; one may, as occasion requires, extend or contract the compasses.
Previous to the last war the common price of wheat was, upon an average,
in _America_ about 20_s._ sterling _per_ quarter, (vide Mr. _A. Young’s
Political Arithmetic_).
If in _England_ a population of 9,000,000 of industrious inhabitants,
yields a landed revenue of 60,000,000_l._ sterling, the wheat being
there at 40_s._ _per_ quarter, a population of 3,000,000 of industrious
inhabitants in _America_, where wheat sells at 20_s._ a quarter, ought
to produce _at least_ a landed revenue of 10,000,000_l._ sterling; I
say _at least_, first, because the land is new, and produces as much,
with less culture; and secondly, because that part of the inhabitants
employed in agriculture in _England_, constitute only one third of the
whole population, and that in all probability, above two thirds of the
_Americans_ are employed in works of husbandry. It may therefore be
presumed, that their landed revenue exceeds 20,000,000, instead of the
10 which I have set down; but this surplus of 10,000,000, only serves to
make good both the national and foreign industry, which is to balance
it, and pay off the taxes: so that, in whatever light my _thesis_ be
considered, every error turns to their advantage.
In limiting their landed revenue to 10,000,000, their wheat remaining at
20_s._ _per_ quarter; let everyone judge what load of taxes they could
bear, before the price of their wheat and other territorial productions,
should come up to that of the same commodities of _Europe_, even
including the expences for the export of their surplusage.
Let every one judge also of the necessity of their bankruptcy, the idea
of which has been so fondly cherished by some low-minded people, and the
narrative of which, they feared perhaps themselves, would unavoidably
stain the first pages of the history of their political existence.
The last war, it is said, has loaded them with an interest of 1,000,000
_per annum_. Would a tax of 10 _per cent._ on every article, or rather
on the total of the produce of national, as well as foreign industry,
_consumed within the country_, be productive of any other effect, but
that of increasing the prices nearly as much? and would the cultivators
of wheat and other productions of the earth, have occasion for any other
expedient to pay the tax, _without being at any expence, without any one
being aggrieved, (provided they should raise in the same proportion
the price of labour attending cultivation)_ but that of advancing, in
the mean time, the price of their wheat, and other productions of the
earth, from 10 to 11 or 12, from 20 to 22 or 24?—This is the case in my
first _hypothesis_, with this difference, that the 21,000,000 interest,
mentioned therein, represented highways, havens, canals, public schools,
&c. and that the interest of 1,000,000, in the United States, will
represent the establishment of their independence. Such a monument is,
in my opinion, too precious to admit a thought of destroying it by a
reimbursement,—_a reimbursement palpably useless so soon as the price of
every thing is restored to a level with the interest of any national loan
whatever_.
They have committed some errors; more will follow: they know not what to
fix upon; nor will they know for some time, perhaps for a long time.—Is
there a State in _Europe_ that can reproach them with any false step, of
which that very same State did not set the precedent at some period of
its history?⸺But with their principle concerning exportation, a principle
founded on justice and evidence, they have already perceived that the
necessitated price of 22 or 24, instead of 20, must be felt in their
country alone; and if their commodities exported for the purpose of
procuring such articles for their home consumption, as they stand in need
of, continue still to yield them the same quantity of those articles of
consumption, as were obtained before the war, will they not perceive that
the home prices, which the re-action of the taxes shall have set upon the
whole of their productions, establish in the country an exact balance of
those new prices at which the taxes will oblige them to sell the articles
to be imported?
Compelled by necessity to have recourse to paper-money, will it be long
before they are made sensible, that nothing more than internal credit is
wanted to make this paper equal to coin, and answer all its purposes for
ever, if they should be thus wisely inclined,—if this measure should be
found the only means of curbing effectually the cupidity of those with
whom they shall have occasion to trade?
Will it be long before they perceive, that this credit will follow close
upon the solidity of public engagements,—a solidity demonstrated by the
evidence of the inutility of a base and infamous robbery?
Will it be long before they feel that all the actual wealth of a State,
its real wealth, is nothing more or less than the mass of its present
industry; that all its _possible_ wealth can arise only from the sum
of all its _possible_ labour; that the greatest riches are only the
greatest sum of labour? that if this labour is a bitter pill, the gold
and silver in which it is wrapped up, are only (like honours, titles,
dignities, fame, esteem, &c.) different kinds of powders, which sweeten
the taste of it to those who are ignorant of its value, to those who know
not how necessary labour is to support every day, without being weary,
and sometimes without regret, the wretched burthen of our lives; and
in fine, that paper, _once got into credit_, can, in this respect, be
an ample substitute for gold and silver ... but how many circumstances,
where gold and silver cannot supply the want of credit?
Will it be long before they become sensible, that they are clogged in
no part of their legislation, by those preposterous maxims which can
be justified only by the circumstances that gave them birth, by those
tyrannical regulations which owed their success wholely to the ignorance
of their cotemporaries, by that chaos of contradictory regulations,
all of which became perhaps necessary by degrees, after the first was
extorted by cupidity?[6]
_Under what Point of View Premiums and other Encouragements of
Exportation may be considered._
The principles of the _Americans_ concerning exportation, lead us to the
examination of the doctrine of premiums.
If the want of objects, capable of exercising advantageously the industry
of a numerous and active people, should compel government, _on account
of some difficulties unconquerable by art and nature_, to apply that
industry to some other object, on which it would be impossible to support
abroad the competition of another nation, that is, to offer equally with
the latter an even quantity of labour of one sort, for an even quantity
of labour of a different one, there is no doubt but, in such a case,
a certain premium, to maintain the competition with the country most
partially favoured by art and nature, would prove, of all institutions,
the most judicious and the most humane; it would be a kind of indirect
tax in favour of laborious indigence; a tax, much more eligible than
many others, which, though destined to the relief of wretchedness, often
increase it, by checking the efforts of industry, by even providing a
resource for idleness, and sometimes an alluring, a comfortable prospect
for debauchery.
It was represented to a Prince truly worthy of the throne he fills,
that a manufactory, in which 8 or 900 persons were constantly employed,
stood him in 4 or 5,000 crowns more than it produced. _How!_ (replied
the Sovereign) _does it cost me no more than 4 or 5,000 crowns to feed a
thousand beggars, and keep them constantly at work? It is a cheap bargain
indeed!_ The most subtle of all ministers of state could make no other
reply to such an answer, than to propose some means, equally effectual,
and calculated to attain, at a cheaper rate, the two most important ends
that a prince can have in view, _destroying beggary, and_, in a manner,
_creating labour_.
There are, no doubt, some other circumstances, which may also justify
premiums on exportation; for instance, the wheat intended for
exportation, is an indispensable article amongst the necessaries of life:
it constitutes one third, sometimes the half of a nation’s riches; it is
_essential_ that it be not in such quantity as to fall in price, because
the disparagement of its value would discourage the cultivator; yet it is
advantageous that there should be, upon a medium, a little more than is
wanted, in order to keep it at the medium price it ought to fetch, that
_one may have it in his power to purchase that which another wants to
sell_. The first thing therefore to be examined is, whether the medium
price, at which it must be kept, in order to equipoise the quantity of
national industry which it must represent, be not so considerable,
First, By reason of some prohibitory act, forbidding the exportation of
other productions of the earth, which, by this means, become cheaper than
they were before this act took place, oblige the cultivator to advance
his price in the others, that the whole may be raised to the level of
industry:
Secondly, By reason of some other premiums on exportation, granted to
various branches of the national industry, which, on that very account,
are grown not only much dearer within the nation, but have also enhanced
the price of all other corresponding commodities, by withdrawing from
them, hands which would have increased their quantity:
Thirdly, In consequence of some prohibitions or restrictions equivalent
thereto, which afford to the national manufacturer the means of selling
his goods 10 _per cent._ dearer than he could do, if such reasonable
duties were laid upon foreign industry, as would leave national industry
in possession of the advantages, which she has a right to, and deprive
her only of the iniquitous privilege of ransoming those by whom she is
fostered:
Fourthly, By the effect of those bodies corporate, (_corporations_)
which, if justly appreciated, are but so many private conspiracies
against the public, whom they strip of the benefit of _national_
competition, after having wrested from them the advantages of _foreign_
competition, which would soon have been followed by the former,
_infinitely more important than the other_.
If the result of the proposed enquiry should show, that one of these
four causes, or rather all of them together, have entirely perverted the
natural price of every article in the nation, it seems to me that it
would be worth the attention of the legislature to examine also, whether
the repeal of all premiums, prohibitions, restrictions, and other devices
of the various passions of the human heart, either to clash against each
other, or to balance their respective injustice, would not prove adequate
to the only aim which we may reasonably wish to attain, I mean that of
_keeping, at the least expence, a just equilibrium between national
agriculture and industry, by securing to both, at the least expence, all
the advantages which they have a right to expect from the agriculture and
industry of other nations_.
But if indeed we were fettered by the errors of past centuries, it would
then be necessary to grant, _in the fullest extent_, the wished-for
premium on the most important article; do nothing more for the present,
but refuse new ones to all the rest; watch attentively the favourable
minute for the restoration of natural order, and forward it, perhaps, by
convincing every one, that the most necessary of all premiums would have
proved useless, had it not been preceded by prohibitions, restrictions,
corporations, &c. _the end of which is as manifestly unjust, as their
effects are injurious to all but those who sue for them_; and that, in
fine, a premium granted under a circumstance the most likely to justify
such a measure, is not, as several people have hitherto imagined, a
necessary means of maintaining elsewhere a foreign competition, but a
very inadequate compensation for that foreign competition of which we are
deprived in so many respects.
_On the Influence of the various Kinds of Taxation upon National Prices._
If I mistake not, I have proved that it is indifferent to agriculture
and industry, whether the prices rise or fall, provided it be always in
a due and reciprocal proportion. Nor is it less indifferent, whether the
increase proceeds from taxes, from monopoly, or from accession of wealth,
and whether the decrease be brought about by the extirpation of monopoly,
or by the triumph of smuggling; so long as the prices balance each other,
no one can be injured however loud people may be in their clamours; it
is impossible to shut one’s eyes against the evidence of such a point.
Why then should we deny the consequence which naturally follows, of the
harmlessness of taxes in themselves, the impossibility of their producing
in any one’s situation, any thing beyond a momentary sensation, _when
they are laid with discernment_; and the futility of either fears or
hopes entertained of their ending at last in a national bankruptcy?
Yet, “to enjoy, is to obey,” says Pope:—To make the best use we can of
the creation, is the thanksgiving the most worthy of the Creator.—There
is not a man therefore who ought not to repine at seeing the general rate
of prices increase in vain, since this very rise compels us to lavish,
in coin, a considerable quantity of those two precious metals, gold and
silver, which would prove more agreeable, if turned into plate, or even
into small pocket-statues, designed for the private worship of those
who would blush only in public, for this kind of idolatry. I should
like therefore to examine, in regard to prices, what is _natural_, what
_necessary_, and what _forced_; in order to find out what might be saved,
if people would attend only to the necessary average.
In the first period of Societies, when they knew of no other want in
the State but personal service when it was necessary and possible, the
common price of the articles then in circulation, was determined by
the quantity of coin _then_ existing in the nation: this is what may
be justly termed the _natural price_. At this present time, when money
is substituted to personal service, and supplies so advantageously its
place; when each representation of an extra service leaves on every
article, the stamp of a seal, which, without adding to the real or
relative value of _any thing_, increases nevertheless the nominal value
of _every thing_;—at this present time, when every nation has all the
industry necessary to procure the coin wanted for this over-charge,
_it is the price, which this very over-charge sets upon the different
objects, that regulates and attracts the quantity of silver to correspond
therewith_; and this price, which may be called _necessary_, is often
evidently _forced_: I say, _evidently_, because, in the state of general
correspondence, or, if you will, of that happy dependence wherein all
the States of _Europe_ stand reciprocally towards each other at this
hour, when we see in one country the same objects, of the same quality,
wrought with equal skill, 15 _per cent._ dearer than any where else, who
can doubt but a part of that difference, of that extraordinary price,
proceeds from taxes, and the other from monopoly? But what part belongs
to this, what part to the other? This is not so easily found out; 1st,
because the part which is the work of monopoly, solely depends on the
moderation of the monopolist, who never fails pleading the taxes for
excuse; and, 2dly, because that part, which proceeds from the taxes,
depends not only on the tax itself, but also on the manner of laying
it, and on the effect which it is likely to produce in the minds of the
people who are to support it. Such a tax as will make a slow, and only a
trifling sensation in the prices of the _French_ markets, will occasion
all at once a considerable one in those of _England_: I shall hereafter
state my reasons for this conjecture.
I am as little qualified to investigate all these different questions, as
those which I have ventured hitherto to touch upon; I shall persevere,
nevertheless, with that freedom which I derive from the purity of my
intentions, and with that diffidence which must follow the consciousness
of a capacity so unequal to the task.—I shall first of all adapt to
_England_, and then to _France_, the reflexions suggested to me by some
hundreds of suppositions, which had engrossed my time before I had
perused _Young’s Political Arithmetic_, and the work of Mr. _Necker_,
which has but lately fallen into my hands.
I shall begin with a general observation on taxes.
_On the Object of all Ministers of Finance in laying Taxes._
In this indulgent age, wherein nothing more is required on any one
subject, than a little decency, it would be a ridiculous and fruitless
hypocrisy to propose a tax, as the means of encouraging virtue, or of
discountenancing vice; it is not, at least in a country where a man
convicted of smuggling wool, is by law sentenced to have his hand cut
off, nor in another where a smuggler of salt is condemned for years to
serve on board the gallies, that one should preach up the heart-felt
concern he must experience at framing a law which would make it felony to
drink spirituous liquors if he had really a mind to prevent intoxication;
it is hoped on the contrary, nay, firmly believed, that the sweetness of
the poison will make palatable the very bitterness of the tax, and its
absurd disproportion to the real value of the taxed article: besides, it
is too evident, that it is not the difference of a few pence _more_ that
will prevent a man from drinking to excess when he is so inclined, nor a
few pence _less_ that will occasion another to inebriate himself, when
his only motive for drinking is a moderate pleasure, or the necessity of
allaying his thirst. The object of every Minister, in laying a tax, is
always to procure the sum at which he has rated its produce; if the tax
should answer any other purpose, this additional one is considered merely
with regard to the prospect it affords of making good another tax less
productive than was at first expected. In fact, a minister of finance is
not a _præfectus morum_—a moral censor: the State is in want of a certain
sum; _that’s enough, it must be found_.—Let us then examine, what kind of
taxation will be the least burdensome in its operation, give its first
shock with the least violence, and be attended with inconveniences of the
shortest duration.
_Effects of a general Poll-Tax._
_Eleventh Hypothesis._
In the year 1779, the taxes in _England_ amounted, I shall say, to 10
millions; I shall suppose too, that this was the tenth part of the
general produce of the land and industry: therefore the 10th part of
the nominal value of that _general produce_ belonged to the tax, or was
_necessitated by the tax_; the 40 shillings, which, to facilitate my
operations, I shall also suppose to be the average price of the quarter
of wheat, must then have been considered as the _necessary_ price, or
the price _necessitated_ by the tax, and 36_s._ as the _natural_ price,
or the price _acquired_ by the sole, _natural_ increase of the national
wealth. But in order that those 36_s._ might be called the _natural_
price, the taxes should have been divided in such a manner as to load
each particular article with a 9th part of its value; that is to say,
that each individual, possessed of a property denominated 9, should
see it charged only with one ninth more, in consequence of a general
poll-tax, which we shall suppose to have been assessed _with the utmost
impartiality_. In effect, it appears, that in this case the proprietor
of a quarter of wheat, who, in consequence of the tax, would have raised
the wheat from 36 to 40_s._ could not be said to have injured the hatter,
who would sell him for 40 guineas the 40 hats which, previously to the
poll-tax, he used to let him have for 36 guineas. It also appears, that
the hatter could not be injured by giving 10 to the workman, instead of
the 9 which he had hitherto paid; and that, in fine, _if 27 millions had
proved sufficient for circulation formerly, three millions more, once
found, were fully adequate to the annual and perpetual payment of those
10 millions of taxes_, without any one being a sufferer, but at the
instant of the first payment. This system is deficient only in point
of practicability; it is not established in _England_: 36 shillings
therefore are not the _natural_ price of wheat; the wheat certainly owes
above 4 shillings to the taxes, if its current price amounts to 40_s._
Let it be observed, nevertheless, that if the system of a poll-tax could
be reduced to practice, if it were not of all systems the most absurd,
though the easiest for government, if it were not of all systems that
in which it is most evidently impossible to avoid thousands of injuries
to the subject, one might establish now in _England_ a new tax of 10
millions annually, and pay it for ever, without altering in the least the
condition of anybody, _provided one could find previously, and once for
all, 2,600,000l. and that wheat should advance in price from 40s. to 43s.
4d. AND EVERY THING ELSE IN PROPORTION_. This appears to me so glaringly
evident, that it extorts from me the affirmative tone. Now as soon as
this should be effected, THE BURDEN OF THE TAX WOULD CLEARLY BE NULL.
But, it will be objected, the price of wheat is not thus arbitrarily
advanced:—certainly not; for were this to be the case, it might also
be lowered at pleasure, and would _every other day_, alternately rise
from 1 to 80_s._ and fall from 80 to 1, since for this operation (become
indispensable) it would suffice that there should be in all the provinces
of _England_ as many bodies-corporate (_corporations_) in _agriculture_,
as there are in _industry_. I am even inclined to think, that it would
then be minutely examined, _Whether it be in fact advantageous to
agriculture, that the merchants export more goods than they import?_ (a
due attention being paid to the five articles so often mentioned, which
render necessary the importation of bullion); a question of the utmost
importance, to which I do not see that any body has hitherto attended,
and which might be so easily determined, if my principles are just.
_Effects of a Land-Tax._
_All taxes, it is said, fall on the land at last. Land is the true, the
only spring of wealth; wealth should be taxed at its very source._
It is certain, that merely by knowing how the matter stands, we know how
to proceed accordingly; and that, in the long-run, every thing arranges
itself in the least exceptionable manner that the system of taxation will
permit. The following is probably the course which things would take, in
the system of a land-tax, if it were necessary now to lay on the land a
new tax of 10 millions annually, supposing always the landed revenue at
60 millions, and the quarter of wheat at 40 shillings.
_Twelfth Hypothesis._
_(I must premise, that in all I have now to say, not only on the present
hypothesis, but on all those that follow, I build on this principle;
~that, from the moment every individual pays the tax~, nobody pays it;
~that nevertheless its produce reverts to the creditors of the State, and
that therefore every body is interested in carrying matters to that issue
as soon as possible~.—If there never existed in the average of prices any
revolution so sudden, so great, and constant in its effect, as the one
which I am about to suppose; it is because it never was necessary to lay
all at once 10 millions of taxes. The effect produced by one million on
a revenue like that which ~England~ enjoys, is so trifling, so gradual,
that it never can be felt.—But to my hypothesis)._
The march of industry is always firm; she can never be bewildered by
her guide. A tax of 2 shillings upon a hat will soon occasion either an
alteration in the quality, or a proportionate increase in its price[7].
_Nothing more just._ But agriculture has only one resource; she cannot
alter the quality of her productions, and she is always timid when she
wants to increase their prices. Let it be granted, however, that the
first attempt of the cultivator will be to enhance boldly the price of
his goods, in a proportion which may return him the amount of the tax
supposed to be of 10 millions: his wheat, of course, will rise from 40 to
46_s._ 8_d._ and so with regard to other productions; then his revenue,
instead of 60, will be 70 millions; but, being obliged to lay down 10 for
the tax, he will have only 60 millions left.
Let us now observe, that when the operations of agriculture are talked
of in consequence of taxes, the land proprietor is alluded to; and from
him they suppose that the ten millions are taken, just as the fleece is
shorn from the sheep; but, on the other hand, that proprietor, though not
very clear in his idea of what is best for him to do, feels mechanically
that he has a right to defend his fleece, that is, to increase the
price of the productions of his land, because without them, neither the
manufacturer nor the Minister of Finance can subsist, and to raise that
price to such a level as will subject him to pay only just as much as the
minister and the manufacturer: and _this again appears to me extremely
just_.
Now this very proprietor receives of his 60 millions revenue, or rather
of the revenue of his land, no more than about 20 millions; (this is
nearly the result of Mr. _Young_’s statement: it will be seen, in
the sequel, that more or less would only alter the proportion of the
shares, without having the least influence either on the application
of the principle, or on its consequences): the 40 millions overplus is
swallowed up, _viz._ for the daily pay of the labourer, 20 millions, and
20 millions for the other charges with which the estates are encumbered,
tythes, profits of farmers, &c. &c. It follows, of course,
_Either_
That the proprietor’s share must be advanced to 30 millions, if he alone
be taxed; and this will leave each of the other parts interested in the
landed revenue, in possession of its 20 millions, as well after as before
the tax;
_Or_,
That each of the three parts taxed singly, at 3,333,333_l._ 6_s._ 8_d._
and enabled to pay the impost by an advance of price, both in the
productions and in the wages of labour, be reduced to its primitive 20
millions, after the payment of the tax.
One is evidently equal to the other; but what is not so, is, that
_industry_, who paid her workmen with 20 millions when the quarter of
wheat was at 40_s._ cannot pay them since the wheat is increased to
46_s._ 8_d._ but by adding to the former wages, 3,333,333_l._ 6_s._ 8_d._
an advance which, when divided on the total of her products, heretofore
rated at 60 millions, raises each third part of 20 to 21,111,111, and
some trifling fractions.—Now, there remains in the hands of each of the
parties concerned in agriculture, only 20 millions over and above the
payment of the tax.—Those who are in the persuasion that the discharge
of the import must lessen, by its whole amount at least, the revenue of
those who pay it, think, no doubt, that agriculture is very well off, to
have, by raising the price of its commodities two thirds, lightened the
weight of so terrible a burden; yet if it were possible by a vigorous
exertion, by an additional increase in the price of provisions, to make
it null to every body, I do not see that it would be reasonable to oppose
such exertion; for, after all,
_Either_
The first increase, brought on by _agriculture_, was unjust; the
proprietor was doomed to sustain alone the whole weight of the tax, if
we allow _the taxator_, the man who laid the tax, to have had a single
thought on the subject:
_Or_,
The further advance in the prices of agriculture is of the most
indispensable necessity, if the _taxator_ has only thought of getting the
amount of the tax with the least trouble to himself, leaving to Nature
the care of distributing _to every one_ complete justice,—to Nature, who
never fails to do it, and who, in so complicated an operation, employs
only the simple spring of that private cupidity, with which she has armed
and shielded every individual; just as, in order to settle the most exact
symmetry in that admirable edifice commonly called a hive, she employs
no other agent than the reciprocal _pressure_ of that multitude of
architects who work at it, each of whom thinks of nothing but to secure a
little cell for himself.
_Thirteenth Hypothesis._
Let us then suppose that agriculture, judiciously determined by wisdom
not to suffer the least encroachments on any part of her _cell_, or
mechanically led by cupidity to justice, boldly raises the price of her
wheat from 40 to 50_s._ and the rest of her products in a due proportion;
her general revenues will then be increased from 60 to 75 millions;
each of the three parts interested therein will therefore stand at 25
millions, but will be reduced to 21,666,666_l._ 13_s._ 4_d._ when the tax
is paid off;—
Industry, compelled also by the advanced prices of the productions
of the earth, to pay her workmen 25 instead of the 20 millions which
they required in the first instance, will divide the additional 5
millions amongst the 60 millions of her former returns; each third share
therefore, rated hitherto at 20 millions, will, by means of the addition,
rise to 21,666,666_l._ 13_s._ 4_d._—_which is the exact balance of the
like sum left in the hands of each of the three branches of agriculture,
after having discharged the tax_.
In a system of taxation which should be imposed only on the land, an
impost of 10 millions annually, on a revenue of 60 millions, whether
it fall on the proprietor, or be divided between him, the farmer, the
cultivator, and other parties concerned, requires of course an addition
of 25 _per cent._ to the price of the productions of the earth, that
agriculture may not be sacrificed to industry; but it must be observed,
that immediately after the reaction of the one upon the other shall be
completed, the burden of the tax will evidently be _null_, since _the
price of labour will have increased equally in both, in proportion to
that of their respective products_.
_Reflexions on the foregoing System._
This system was devised to countenance and encourage agriculture; it
is in her hands, they say, it is at that fountain-head of riches, that
riches must be sought for; it is the land that finally pays for all; the
impost then must be laid on the net produce of the land.—I shall venture
some reflexions on a subject which appears to me the more important, as
one of the wisest, and the most profound speeches ever delivered in the
House of Lords, seems to hint at the expediency of an aggravation of the
burden already laid on agriculture.
Agriculture is the spring of life; it is not the spring of those riches
which we call money: money must be had for taxes; money flows from the
hands of industry alone: it is then from this spring that money must be
drawn.
Besides, how is it known that the money, wrested from agriculture, is
not necessary to her support? Or how does it escape observation, that
all the money which is not laid out by the cultivator upon agriculture,
will necessarily revert to industry, either by the immediate consumption
of the cultivator, or by that which he shall have occasioned on the part
of the person to whom he shall have lent the value of what he has not
consumed himself?
How comes it to be known, that the proprietor of a landed estate that
yields him, we shall suppose, 800_l._ _per annum_, and who is charged
200_l._ for taxes, is not indebted in 300_l._ out of the remaining
600_l._? Now, it is true that 300_l._ are sufficient for his support; but
were those 200_l._ which are forced from him, laid out annually on his
land, they would certainly in very few years raise its produce from 800
to 1000_l._—What is that but to assess unjustly a man who enjoys only
500_l._ as high as another whose income amounts to 800_l._—to tie down
agriculture to 800 when it might rise to 1000; to deprive industry of the
re-action produced by that benefit; to crush population in the very bud,
and consequently to prevent a more considerable consumption; in fine, to
deprive government beforehand of the amount of those taxes which that
increase of population and consumption would have secured to the State?
It may be said in _France_, it is true, that by a tax laid on private
loan-covenants, those inconveniences are partly removed; but this very
removal is only an additional obstacle, thrown in the way of agriculture,
to impede its progress;—the man who could lend to the cultivator, besides
the fear of not receiving back his money when wanted, has before his
eyes the certainty of being charged with the twentieth penny laid on
the interest of the money thus advanced, and consequently, as often as
he conveniently can, lends that money to a merchant, who besides his
punctuality in paying at the fixed time, never hesitates to allow the
usual interest without any deduction whatever.
It may be said also in _England_, that all over _Great Britain_, the
land-tax, (which, like some others, is perhaps no more than a real
poll-tax under a name less grating to a _British_ ear) does not exceed
the sum of about 2 millions out of 14 or 15, the whole amount of her
taxes; but nothing can be deduced therefrom, but that it is subject
only to a proportionable share of the inconveniences above stated;
inconveniences which are inseparable from it: we may add, that it
is indeed free from some further grievances which fall heavy on the
_French_ cultivator:—but can the _English_ boast of their tax being
founded on an invariable principle, when this very principle is unjust
in its consequences, and, as often as necessity requires the tax to
be advanced, multiplies the injustice which follows it?—Yet they hint
at the expediency of increasing that very tax, in order to alleviate
the imaginary burden that weighs down industry!—Some pretend that the
land-tax is become a _public property_; they suppose that all such sales
and purchases of land as have taken place since the year 1740, have
been effected on that principle of renunciation of the capital, the
interest of which is paid by that land-tax:—they infer, no doubt, that
the intention of those who did not sell, was implicitly included in that
of those who have actually sold; for they propose that all the present
proprietors shall redeem the tax, in order to refund part of the national
debt; as if, on the very next day after the redemption, Government had
not a right to renew it, if some fresh exigency should start, which
could not be answered by any other means.
In the critical moment of a discredit, which will always be imputable
to the Minister, when the King and the People are fully acquainted with
their real interest, if administration, not knowing what to do, does not
hesitate to apply to the land proprietor, whose ways and means are always
visible, and whose purse lies, as it were, ever open against his own
inclination, the Minister, no doubt, finds his excuse in the necessity;
but after the crisis is over, why should the proprietor be further
aggrieved?
But, say they, the amount of the tax cannot be dispensed with;—no
objection can be urged against necessity; _all that is wanted, is the
least that can possibly be given; just as all that is wanted, is the
most that it can be advantageous to take_: but the whole should be paid
by each individual, only in proportion to his faculties:—Now the fact
is, that the faculties of the land proprietors are not better known
than those of the merchants;—_the latter have found means to prove, to
persuade, that they ought not to be taxed, but in proportion to their
consumption, the only criterion of their riches_, or at least that part
of their riches which they do not lay out in increasing commercial
wealth.—IS THE IMPROVEMENT OF THE TERRITORIAL WEALTH LESS ESSENTIAL, OR
LESS VALUABLE TO THE STATE?
Let us examine, however, in what degree the taxes laid on the different
articles of consumption, must enhance the price of goods, in order that
agriculture may not suffer more than industry. If it should result from
this research, that many previous false steps have raised the greatest
obstacles against the execution of those measures which would prove
the most equitable, without being more disadvantageous in any point of
view; the inconvenience of such obstacles might be deemed trifling, when
_compared with the burden supposed to be transmitted to posterity_. And
it is not in _England_ that an important truth, generally acknowledged,
will long remain without effect; it is not in _England_ that an important
truth will long remain without being generally acknowledged.
_Effects of an Impost exclusively laid on the Articles of Consumption
peculiar to the rich, or in other words, ~on Luxury~._
The immediate effect of a tax, is to raise the price of the object on
which it is laid, by at least the whole amount of the tax: _nothing can
be more just_; but it is at the same time a consideration which ought
to keep pace with the one I have already offered, on the very positive
_object_ of all kinds of taxation, namely, _to secure the sum at which
the product of the impost is valued, whatever that sum may be_.
Now, in order to estimate justly the system of taxation we are
considering, it must be presented in all its glory, that is, such as
all Ministers of finance in _Europe_ seem to wish it; such as all the
_English_ news-papers recommend it, rather roughly, each of them at least
once a week; such as all Oppositions, past, present, and future, have
pretended, do pretend, and ever will pretend it to be, so easy and so
equitable; such as all preachers of the _Roman_, _English_, _Jansenist_
and _Presbyterian_ persuasion, are wont to deliver it every day among
the private societies whom they are pleased to honour with their partly
christian, partly political reflexions, and would speak it out from the
pulpit, if Ministers of finance had any leisure to hear their sermons,
&c. I shall therefore suppose that the tax of 10 millions, mentioned
in the three foregoing articles, should be assessed in so able, so
_charitable_ a manner, that 5 millions should fall on the landlord, and
the other 5 on the richest proprietor of money. I shall begin with the
most essential, for the State is certainly founded on the landed property.
What is the revenue of the land-proprietor?⸺Nothing more, all expences
defrayed, than the third part of the real produce of his lands; and this
third is, in the _hypothesis_, estimated at 20 millions only.—These 20
millions finding in the hands of industry, that portion which usually
gave the balance of those 20 millions, raised to 25 millions by means of
the tax, it clearly appears that the proprietor alluded to is short by 25
_per cent._ of the sum required to pay that portion.—In this case what is
he to do?
Shall he leave industry in possession of one fifth of his former
comforts?—Then industry would be debarred from the sale of that fifth
part; one fifth of its artificers would be left without any other
resource than that which the highway might afford, _and the main object
of the taxation would be defeated in the following year_, unless
exportation should make up to industry for the want of home-consumption,
(_the only one by which a State can prosper_,) and the _deficit_ of the
tax laid on the home-consumption, should be compensated by another tax
on foreign consumption, that is _on the exports_.
We shall suppose this to be the case, and that industry actually exports
that fifth part of the national commodities which the land proprietor
is not able any longer to consume, and which, nevertheless, industry is
compelled to sell, in order to be reimbursed the tax she has advanced,
and be prepared to answer the fresh demand which next year government
will have occasion to make.—But if it were to such means that _England_
should stand indebted for part of the increase in her exports, her
industry, methinks, would have derived less advantage therefrom, than a
home-sale might have procured, even supposing the inconvenience of which
I shall speak presently: it appears to me also, that the land proprietors
would, in that case, have some reason to complain, and that the rest
of the nation would have no cause to boast of the immensity of her
exportation.—The draw-backs granted on the very exportation of the taxed
commodities, prove that such an expedient never was adopted in _England_.
Will the land proprietor come to a resolution to fly from his native
country, in search of another, where good men content themselves with
declaiming against luxury, without making any attempt to destroy it? No,
he never did, nor ever will take that resolution; he is fast bound to his
land by the roots of every plant he has laid on it.—What then is he to
do? It behoves the Minister of finance to give him some wholesome advice.
If the Minister be silent, or if he shuffle, because he is closely
watched by Opposition, he must equally lose his popularity; for the
land proprietor, left to shift for himself, will raise the price of the
productions of his land, in proportion as the tax has increased that part
of the products of industry that concerns him.—
But his 20 millions revenue, have, as I have said, the same component
parts as the 40 millions which he is obliged to give up for the expences
of cultivation, and other incumbrances attending property:—he cannot
therefore increase them to 25 millions, without raising by one twelfth
the total amount of the 60 millions of landed revenue; this will at
once carry up the quarter of wheat from 40_s._ to 43_s._ 4_d._: this is
therefore an advance of 8⅓ _per cent._ on his commodities:—upon which
we must observe, that no increase will take place in the wages of the
mechanic, or of the husbandman; for the objects of luxury are the only
ones which we suppose to have been taxed: such is the _infernal_ side of
this _heavenly_ system.—Yet this is not all.
What is the money-proprietor to do, not having it in his power to
raise the price of his money as the landed proprietor can do that of
his wheat, but who, on the contrary, is invariably limited to the same
nominal revenue, whilst the tax of the other 5 millions, which the
_humanity_ of the _taxator_ had levelled at him, has occasioned a rise
of 25 _per cent._ in the nominal value of those articles of luxury in
which he indulged himself?—He will, he must leave them in the hands of
industry, and confine himself to such objects as are not taxed; it is a
resource, as it is at the same time a compulsive measure.—_The produce
of the tax will then be inadequate to the want_: a second impost must
then be thought on, to supply the _deficit_ of the first.—_Fall again
upon luxury_, cry the enthusiasts; _this is more necessary than ever,
for bread is already 8⅓ per cent. dearer than it was, and the land
proprietors have abated nothing of their luxury; they ride still in their
chariots, whilst the poor loaded porter constantly trudges on foot_.
Enthusiasts will never see further, and those who are not enthusiasts
do not yet see far enough; for they only say _that it is expedient for
government, that the prices of commodities be kept up, in order to
facilitate the payment of the impost_.—Yet, _if it is expedient_ for
government, that the prices be _kept up_ to _facilitate_ the payment of
the impost, I conclude that it is an _absolute necessity_ for government,
that the prices do increase, when there is no other visible means to
establish _the possibility_ of paying taxes. I therefore have to answer
only to the enthusiasts, and let it be as the enthusiasts will have it:⸺
But the first 5 millions of the _charitable_ tax could not be paid,
without an advanced price of 8⅓ _per cent._ on all the productions of
the earth, without raising the wheat from 40_s._ to 43_s._ 4_d._—it will
then be necessary to increase its price by as much again; it must advance
from 43_s._ 4_d._ to 46_s._ 8_d._ in order that the tax be paid _without
foreign assistance_. Then all will be settled, regulated, balanced, and
paid between the _capitalists_ of land and those of industry; _but as no
objects will have been taxed but those of luxury_, how long will it be
before the people, the labouring man can see justice done to him?—Ten
popular insurrections perhaps will be required to extort it. Yet let us
suppose that the very first proves sufficient to procure it complete,
that is, that their wages be raised 16⅔ _per cent._ as the tax after
all the necessary re-actions has increased the price of the produce of
their labour:—in this case, instead of the 20 millions allowed before to
each of the two classes of working men, cultivators and mechanics, they
will then receive 23,333,333_l._ 13_s._ 4_d._—But how will you wrest
from the hands of the land proprietor 3,333,333_l._ 13_s._ 4_d._ out
of the portion which he was obliged to lay by, _that the tax might be
paid by his consumption_, without his advancing again the price of his
commodities in such a proportion as will return him the new sum which
he is forced to pay?—And were he not to augment again the price of his
commodities, would not then a new tax become necessary to supply the
_deficit_ which the rise of wages of the labouring men must occasion in
the consumption of their employers?—The land proprietor will then add
still to the price of his goods;—but will not this addition, _equally
necessary as the two first_, be productive of a further necessity of
raising in proportion the price of labour, the wages of the labouring
man?—No doubt; and another insurrection would procure justice, if the
thought did not occur at last of observing, that _the class of labouring
men being, before the tax, in possession of one third of the general
revenue, forms, in this respect, a third interest equal to one half of
the two other_. Now, the tax having enforced an advance in prices of 16⅔,
to shelter the two former from its effect, there must also be, in favour
of the third interest, a third increase of 8⅓, which rising at last to
25 _per cent._ more, the price of labour, as that of its produce, both
in regard to land and industry, will exactly leave to each of the three
interests, under the denomination of _twenty-five_, the same comforts as
each of them enjoyed under that of _twenty_ before the tax was laid.
In regard therefore to the effects of the tax on the prices of
provisions, there is not the least difference between the system of
taxing luxury, and that of a land-tax; 50_s._ in the supposition of an
impost of ten millions, would prove in either system the _necessary_
price of wheat; for if ever a price can be termed _necessary_, it is when
it cannot be lower without effecting the ruin of the land proprietor, and
even _without missing the sole and indispensable end of taxation_, unless
recourse be had to one of the following resources:
_Either_
To export such commodities, which, as it might be absurdly supposed, the
nation is no longer able to consume,
_Or_,
To steal from the people the proportionable increase _due to them_ in the
price of their labour, if they should prove so complaisant as tamely to
submit, out of gratitude, for _the tax being laid only upon luxury_.
I shall conclude this article with a reflexion which may give birth to
many others.
The impost on _luxury_, which, after a very little time, as we have seen,
proves no ways injurious to those who were able to pay for the objects
upon which the tax was laid, is besides, under another point of view,
really advantageous to those very men who seem the only contributors to
it; _because_ it sets entirely above the reach of the people, a number of
articles in which they would indulge themselves, _to the great benefit of
the tax_, and which, though perhaps intended _by the general provider_,
as well for the poor as for the rich, are nevertheless, by the _merciful_
system of taxation, exclusively reserved to the rich.—Is this the
intention of the _merciful taxator_?—in my opinion it ought not to be
that of an _intelligent one_.
_Effects of a merciless Tax upon all the Articles of the most general
Consumption._
Instead of laying a tax _on men_, from whom, without rushing with open
eyes into the perpetration of a thousand injuries, it is impossible to
require any thing more than a _personal service_, when it is necessary
and _possible_ withal; instead of taxing _the land_, from which nothing
can be expected but food, and the rough materials to which industry
can give from one to many hundred degrees of value; instead of taxing
that imaginary monster called _luxury_, which procures so substantial
a support to some, and such pleasing comforts to others, lay your tax
solely, and without predilection, on _all those products of national and
foreign industry which are more generally consumed_; then, in my opinion,
you will have reason to flatter yourself that riches are taxed to their
very source, and without inconvenience to any one, since you tax it in
the hands of those who are, _by the strictest justice_, authorised to a
benefit for all the advances made by them to the consumer.
So then, though the tax of 10 millions be fixed on certain parts of
industry, nothing will prevent the whole from rising proportionably; and
for this, _God alone be thanked_. The whole will be then 70 millions
instead of 60;—upon which the least reflexion is sufficient to make us
feel the necessity of the re-actions mentioned in the foregoing system,
_but with this difference_, that the general consumption having been
taxed, the two _capitalists_ cannot, even on the very day when the impost
takes place, shut their eyes against the justice of increasing the
salary of the labouring man in a due proportion.—Now, _the interest_ of
the two capitalists could not, as in the preceding system, be preserved
undiminished, but by an increase from 60 to 70 millions, that is to
say, 16⅔ _per cent._—Now, _the interest_ of the labouring man is, as
has been observed before, equal to one half of the other two classes
in the general revenue, or, in other words, equal to either;—it will
therefore become necessary, in order to restore the former equilibrium,
to introduce a fresh increase of 8⅓ _per cent._ upon every thing;—in
consequence of which the price of labour, being raised 25 _per cent._
just as its products, both in cultivation and industry, will leave also
the two classes of labourers in the same situation they were in previous
to the tax; each of them was then in possession of 20 millions out of
60, each will now get 25 out of 75.
I think also that _then_, a Minister of finance, ever so anxious about
his operations, ever so zealous for the establishment of none but
_productive_ taxes, could not conceive a single article of consumption
that might suffer by this arrangement; it would appear too evidently
that every one would _then_ have the very same faculty of consuming,
manufacturing, or saving, under the denomination of 25, all that he had
before consumed, manufactured, or saved under the denomination of 20.
It would also be seen _then_, that the success of those taxes termed
_productive_, is not to be ascribed to the abilities of the _taxator_,
but to the abilities of the persons _taxed_, who have taken care to right
themselves by so much as the _taxator_ ought to have been afraid of being
unjust.
_Then_ also would every one be sensible, that the advance in all the
prices could not be only of a 12th part, or 8⅓ _per cent._ as in the
_glorious_ system of a poll-tax _established by Divine Justice_, but
of 25 _per cent._ neither _more nor less_ than in the system of the
_land-tax_, neither _more nor less_ than in the system of an exclusive
tax _upon luxury_; that consequently _wheat_, as well as produce of
any other sort, as well as _labour_ which gives the whole, _would be
indebted to the tax for a fifth part of its new nominal value_, and that
50_s._ would be the _medium_ price of wheat;—its _necessary_ price,
but not more _necessary_ in that _merciless_ taxation, than in the
_merciful_ one laid on the exclusive consumption of the rich:—and this
calls for the attention of every individual; nor can it be too often
repeated, because _then_ neither hypocrites, nor enthusiasts, nor good
men, nor manufacturers, nor farmers, nor proprietors, could any longer
deceive themselves or others, on the price of labour; it would be too
self-evident that the said price ought to increase with the taxes, and
that no one would be injured by that increase.
Then it would also appear, that some people had very good reason to say,
that the burden of all taxes, falls one time or another, on the landed
property; but who could refuse to admit besides, that I am tolerably
founded in insisting, that when taxes have in fine reached every part of
the whole, no one part can feel the weight?
_The money proprietor_, it will be said, the _lender alone_ will be
aggrieved; he must lose the fifth part of his usual comforts, he must pay
15 for those articles which he could procure formerly for 12.
I shall confine myself to three answers:
First, _Is it not self-evident, that any financiering operation, which
reduces from 5 to 4, the interest of a national debt, deprives as well
the lender of the fifth part of his comforts, AS IF THE NATION HAD LOADED
HERSELF WITH TEN MILLIONS MORE, TO BE PAID ANNUALLY? (such is the present
hypothesis.)_ There stands, therefore, between the two cases no other
difference, but the _palpable_ justice and necessity of the one, and I
believe we may say, the _unsuspected_ inutility and injustice of the
other.
Secondly, We have already seen that the loss of the lender, in all cases,
flows essentially from the nature of his capital; that it is inseparable
from the advance of prices, whether _that advance_ originates from an
accession of wealth, or is produced by taxes, or brought on by monopoly;
and that besides, by lending to the State, with the certainty that the
State could not pay the interest of the loan without the assistance
of an import, he has beforehand submitted to the effects of an impost
_indispensable_ to his main object.
Thirdly, If we except a poll-tax, which we should suppose _laid by Divine
Justice_, and which, in the present hypothesis, should wrest from the
lender only a twelfth part of his enjoyments, where is the system, which,
_in the supposition of a tax of ten millions, being now necessary in
England_, would not deprive him of a fifth part of those enjoyments?—We
shall see presently that a _compound-tax_ would perhaps prove still less
favourable; but how much has he to dread, in all cases, from the indirect
taxation of the _monopoly_, which it is impossible duly to estimate!
_Effects of Compound Taxation._
The system of taxation, which may be called general, is composed of
the four different kinds of taxes which I have just mentioned:—First,
some kind of _poll-tax_, under that or any other name;—secondly, a
_land-tax_;—thirdly, an impost on the consumption of the rich, or
_luxury_;—and fourthly, in fine, the freedom taken with _the consumption
of the poor_, or general consumption; for the sun of reason forces its
way through the darkness of prejudices; these only serve to retard the
progress of nature wherever light first began to shine. It would be
easier to stifle truth at first, than entirely to escape its effects.
No country in the world can be guarded against the injustice inseparable
from the _two first parts_ of the system of a compound-taxation, whatever
may be in that respect the wisdom of the legislature, and its tenderness
in the manner of collecting the impost; no country can be free from that
other kind of injustice which results from the general prejudice in
favour of the tax on luxury, which constitutes the _third part_ of the
system under examination; but the _ensemble_—the whole together, does not
produce every where the same effects on the prices.
In _France_, from the beginning of the present century down to the time
when Mons. _Turgot_ was intrusted with the department of the finances,
the sum of what I can collect from the _French_ mode of taxation, is,
that without any determined system, without any other rule than the
immediate want of money, and the facility of procuring that money by
means of a loan, at any interest whatever, they had successively taxed
whatever came first to hand, or occurred to the imagination of the
comptroller general for the time being; nothing was spared, in order that
no one should complain; landed estates, employments, money, individuals,
the one because he was industrious, the other because he had no industry
and _that he might acquire some_; this man, because he had a _title_;
that other, because he had none; a third, on account of what he consumed;
a fourth, for that consumption to which he was doomed,—(_an expedient
which, together with the galleys, was devised by the farmers general,
as an admirable stroke upon smuggling_). No sin more venial, than to
take some liberties with a compound of such motley pieces; nothing more
severe than the reflexions thrown out against it on the other side of the
channel; and nothing can more forcibly prove that _France_ was planning
some reform on the subject, than the orders given most minutely to
enquire into the principles and effects of the various modes of taxation
adopted in other parts of _Europe_. I think, in regard to all those parts
of _French_ taxation, which I have alluded to, as every intelligent man
does in _France_ and _England_: nevertheless, if one cannot positively
affirm, that the result of such a chaos of strange regulations, has
been, that every one perceiving the burden to be general, nobody ever
thought of easing himself at the expence of others who appeared to have
been loaded in the same manner, yet it cannot be contradicted, that,
notwithstanding the want of true principles on the part of the _taxator_
in _France_, the price of every thing might have continued to this day,
without material alteration, had it not been for an event, of which
I shall speak in the sequel; and if it were true, as some very deep
politicians will have it, that _the more depreciated commodities are in
a country, the quicker that nation advances towards opulence, because,
in such a case, the national manufacturer has it in his power to favour
the foreigner by underselling all other countries in the world_; if this
principle were not at least questionable, as I hope to prove it by and
by, every one would admit that the _compound-taxation_, EVEN COMPOUNDED,
as I have just described it, does not appear totally destitute of some
advantages.
Before I venture to express my thoughts on the subject, I wish the reader
would form to himself an idea of what might be the effect of such a
system in _England_;—in _England_, where every man is a calculator, and
adds without ceremony, on the creditor side of his books, the number
of figures necessary to balance those which he thinks too many in the
calculation of others. They say in _England_, and there they are more
bitterly persuaded than any where else, that taxes take annually out of
the pockets of those who pay them, the whole amount of the impost; but
_there_ as every where, and _there_ much sooner than in any other part
of the world, justice and reason never fail to put into the head of each
individual, what he is to do, that the tax be not paid for a long while
out of his own pocket. I may therefore boldly say, that nothing more is
wanted on the part of _England_, to join perfectly in opinion with me,
concerning the most important point (that which concerns the national
debt), than to observe, that every one has always done as secretly and as
expeditiously as he could, for himself alone, what I insist it would be
advantageous to do openly, with equal celerity, for the general good[8].
I now resume my subject.
It would be, methinks, a difficult matter not to conclude, from such
very reasonable conflict of private calculations, that, were the
_French_ system to be adopted in _England_, it would not, in that
_land of benediction_, experience the fate of exotic plants; far from
degenerating, far from keeping the price of all things at the lowest ebb,
it would acquire from the influence of general maxims, and from universal
custom, the weight necessary to balance that multitude of private
injuries, from which it is impossible to keep it free. Now, this cannot
be effected without forcing the price of every thing up to a pitch so
much more extravagant, as each man, in such a case, is the natural judge
of the indemnity he should allow himself for the tax imposed, and for the
advantage that others derive from it; if any one should shrink on the
occasion, he finds in his _corporation_ a degree of vigour, of which he
shares the benefit. The word of the law is the only bridle in _England_;
a tax of 4_s._ on a particular article, increases its known price only
by something more; but if government gets 50,000_l._ from a tax, under
the appellation of _licence_, or any other name, which leaves the man
thus taxed, supreme judge of the rate, and at liberty to choose the means
of indemnifying himself, one may rest assured that such a tax costs
the people six times as much as it brings in to government. Let every
man candidly weigh this (I don’t say undenied, but I say) undeniable
assertion, from the circumstances of the moment; let him examine what
remains to be done by the land proprietor, that he may not be most
shamefully ransomed; let him judge in what predicament that man must
stand, whose fixed revenue in money, affords him no resource against the
effects produced by such an emulation; let him observe, above all, that
the daily labourer will not, _before the matter is brought to the last
extremity_, be paid one penny more, _because care has been charitably
taken to tax almost none of the articles of his consumption; and let him
then_, if he dares to do it, _let him bless the tax on luxury_, and any
other kind of impost, _but such as is laid on the objects of most general
consumption_.
The _real_ necessity of providing for the interest due on the debt
contracted during the last war, and the _imaginary_ advantage of the
intended reimbursement, have compelled the present Ministry (and
according to the maxims and ideas that predominate at this time, would
have compelled all possible administrations) to impose many taxes of the
very exceptionable kind; to their effects add those of the indirect tax
of corporations, premiums, prohibitions, and new obstacles thrown in the
smuggler’s way, it will not be wonderful that the million sterling for
the _imaginary_ want of a reimbursement, together with the three millions
some hundred thousands, for the _real_ want, (the interest of the debt)
and which, at the word, ought not to increase the total mass of prices
much above 8 _per cent._ actually advance them to 12, whilst in _France_
the expences of the late war will not perhaps occasion, _at first_, a
rise of more than 6 _per cent._ It will be seen in the sequel why I say,
_at first_.
But, they say in _France_—but, they say in _England_, all the articles
of consumption are already so loaded, that it is impossible to think of
increasing the weight. The _French_ Farmers General themselves tremble
when they propose to increase the duties on any article; _will not
consumption suffer by it_?—Such is every where the terrible argument
that prevents the establishment of the only unexceptionable system,
the only equitable, and the only advantageous one to the people—to the
people, on whose account they pretend to be so anxious.—That system,
it is true, would lessen by one half, _the nominal value_ of those
operations that are held in so important a light, of all those tricks of
which the contrivers themselves entertain so high an opinion; but what
ease, what leisure would not this very system procure to the Minister!
Let us then see whether the formidable argument, on which is grounded
the impossibility of doing _the best_, will bear the analysis, so
_formidable_ also in so many cases.
_Some Doubts on the supposed Impossibility of laying all Taxes on
Consumption._
The universal voice in _England_ is, that so many taxes should be laid,
as are necessary to answer the exigences. Ministry, Opposition, Subjects,
all agree in this essential point; but if we except some taxes which
bear principally on the land proprietor, who never says any thing, and
whose silence commands that of every one who shares in his burden, the
ablest man in the three kingdoms is not capable of proposing one, on any
article, which would not be followed by a petition from those very men
who do not even wait till it has received the royal sanction, in order to
derive from it an extravagant advantage, if it be within the meaning of
_licences_, and perhaps only a profit _rather above_ a reasonable one,
if it bears on an object properly specified.
I have perused several of these petitions; and the substance of what has
appeared to me most striking in every one of them is nearly this: “Let
every thing be taxed in _England_, nothing more equitable; let every
thing be taxed, _every thing_, except all the things that concern your
humble petitioners: you cannot tax them, without ruining their trade; and
not only their trade, but also the whole trade of the nation at large;
and not only without ruining the whole trade of the nation at large, but
without stifling that principle of liberty, that noble spirit of life,
which has so highly distinguished her above all the nations in the world.”
Were any one to infer, from the foregoing extract, that my intention is
to stigmatize the use of _petitions_,—notwithstanding the most invincible
antipathy I bear to exclamations, which, for the most part, betray either
weakness or hypocrisy, I should exclaim, O Divine Liberty, of _humbly
shewing_, to the most respectable parts of a nation, all kinds of ideas,
whether absurd or reasonable! Divine Liberty, never treated in _England_
but with that regard which is due from one man to whatever comes from
another man! Divine Liberty, who givest to the Legislator, the time,
knowledge, and often the means, necessary to prevent him from falling
into such errors as it is not beyond the power of human nature to avoid,
... be thou ever blessed, and mayest thou be worshipped wherever men are
not infallible, and wherever millions of men may suffer from a single
mistake!
In _England_, the produce of taxes on the various articles of
consumption, amounts, I suppose, to 8,000,000_l._: in order to procure
the 5 or 6 other millions required, a part of which is necessary, a part
of which is supposed to be so on account of the plan of a reimbursement,
the land continues to be taxed for 2 millions, and the other 3 or 4 are
taken from perhaps 30 different articles, one of which will bring in
150, another 100, a third 60, a fourth 30 thousand pounds, &c. with a
salvo for Government to tax half a score more articles, if it should be
robbed rather too unconscionably on the produce of the former; for, in
all countries throughout the world, this is all the conjuration in that
part of the administration of finances which relates to the collecting
of taxes; if you rob Government in one point, be sure Government will
ransom you, if required, on ten others; nothing more just, but nothing
more easy.
Now, if we lay it down for an indubitable maxim, that the most able
Administrator of finances, cannot take from an individual, more than
what he possesses, it seems to me then that it remains only to examine,
whether that very individual from whom, one way or another, out of the 20
he is possessed of, 5 may be wrested,—will be less aggrieved if the 5 be
taken out of his pocket, and he be sent to market with the remaining 15,
than he would be, were he permitted to go with the whole 20 to market,
where he would find those 15 which he used to purchase for 15, charged
with the 5 which might have been taken from him at home?
The question more to the point is yet more singular; for it goes to this
enquiry:
First, Whether the land proprietor, who is obliged to give at a fixed
period three millions in taxes for his land, windows, domestics, and
other objects more recently taxed, would think himself more injured if
those three millions were divided and laid upon some objects of his
consumption, while he should observe that by this new order of things he
would gain the convenience, not only of paying these three millions by
different and remote installments, but also of making use of the money
previous to such payment,—without injury to the trader, to whom the
interest would be one way or other repaid,—while on the other hand, a
part of the money, laid out upon his land, would furnish new resources
for augmenting the produce of the taxes, by increasing his faculties of
consumption:
Secondly, Whether those unfortunate licensed persons, and others (who so
bitterly complain of all the various taxes that produce to them three
or four times the sum which they advance to Government) would not be
_justly_, as they ought to be, relieved from the _oppression_ (that is
the word) if such taxes were taken off, and laid on articles of which
they would themselves be the consumers:
Thirdly, Whether all those extraordinary, usurious, and unjust benefits,
arising from those _oppressive_ taxes which I have been mentioning,
reduced to their proper point, by taxes that would not increase the
price of any article beyond a known degree, would not naturally reduce
the _value_ of every thing to that _necessary_ price I have spoken
of,—to that price which every thing ought to maintain, that the imaginary
_oppressed_ might not actually _oppress_ the imaginary _oppressors_,—that
all things may be preserved in a just balance, without any person
experiencing a change in his condition;—and consequently, without the
consumption of any article being diminished, unless fancy or fashion
should transfer it to another article that will indemnify for the
deficiency.[9]
From _England_ let us pass over to _France_, and always taking for
granted that a Minister of finance is not a conjurer, and that he can
take from the pockets of the people no more money than they possess; I
wish it could be examined:
Whether the 41 millions of _livres Tournois_, produced by the poll-tax,
and which should be paid no longer, when that tax should be transferred
to, and divided between all the articles _of the most general
consumption, and of course the most productive_, would diminish the
general faculties, by increasing the value of those objects, to the whole
of that sum which the contributors would gain by paying no longer the
poll-tax.
I would have it also enquired into, whether the clergy, finding the
objects of that general consumption loaded with 11 millions more,
could be aggrieved by the sole disappointment of giving no longer
_gratuitously_ to his Majesty, those 11 millions which they are now
_compelled_ to pay; and whether they would not be left in possession of
all the faculties necessary to satisfy the first article, as soon as they
should be freed from the other.
I should also wish the _French_ to examine whether the 76 millions
_Tournois_, paid in that country for the _three twentieths_, instead of
being very often called for, _at a time when the Subject has them not_,
transferred to those objects which cannot be consumed but by means of
the money remaining after those 76 millions are discharged, would impair
the means of the contributors, although after having eased them of that
truly terrible tax, the Minister should, in a manner, juggle them out of
the whole amount of it, by another impost on consumption. Supposing even
they had some suspicion of the trick, I wish it were examined whether
they would think themselves injured by paying in the new way that amount,
by installments at their own time, and till then laying out a part of
it upon their lands, the revenues of which would of course increase in
proportion.
But above all, I wish it should be examined, whether 91 millions of
another kind of subsidy, called _la taille_, added to 7 millions and a
half more, laid out in expences for warrants and distresses, necessary
to enforce the law of the subsidy, transferred upon the consumption of
those from whose hands the _subsidy_ is directly wrested, against whom
the _warrants_ are issued, upon whose goods or body the distresses are
executed, would diminish the faculty of that poor people’s consumption,
if, by means of that consumption, by the suppression of the old
_subsidy_, of _warrants_, and _distresses_ attending the same, they
should acquire the faculty of consuming cheerfully, what they often
consume in bitterness and sorrow; and whether the department of the
finances could lose by it any thing more than the pleasure or trouble,
or rather the necessity of assessing a dreadful subsidy, issuing out
warrants, and distressing the body—when there are no goods to be
distrained.
_But in this scheme the expence is more considerable._
This is the grand objection: _The expence is more considerable!_ Reduce
the unfortunate to a bed of straw, or cast him into prison, to spare the
purse ... of whom?—For after all, supposing even that a few additional
charges ought to be compared with millions of inconveniences, injuries,
and acts of barbarity, which are inseparable from the other methods, let
it be examined whether the extra charges can produce any other effect,
than that of advancing by a few _deniers pour livrè_ the general price
of merchandise; let it be examined whether that advance is not a matter
of perfect indifference, provided that the price of the provisions sold
by the land proprietor, _who is stiled rich_, and that of the wages of
the labouring man, who _is called poor_, rise in the same proportion as
the goods of the _capitalist_ of industry, who stands equally and as
essentially in need of the ease of the _poor_, as of the opulence of the
_rich_.
In fine, Let it be examined whether there is any thing great, courageous,
just, and fair, that may not be expected from the _French_ nation, when
she shall be admitted to the honour of being heard,—or when they will be
kind enough to convince her.—A King of _France_, with the trifling help
of his provincial administrations, may do, and play with every thing: a
King of _France_ is truly a despot; not from that absurd right of giving
his _will_ for _reason_, but from that principle which is congenial to
the _French_, that the People and the King are but one, have but one
interest, and have nothing to fear but the ignorance of a Minister,
conscious of his inability, without the least thought of the resources
he has at hand in such a case, without principles to guard him against
committing those injuries which seem to him unavoidable, in order to
conceal the errors which he has been, or fears to be, guilty of; a
Minister, in fine, whose insignificant little self, wrests from the King
and People, the fruit of that _identity_ which forms the acknowledged
essence of the _French_ constitution.
What seems to be in _France_ no more than a fortunate prejudice, is
every where an irrefragable truth: in every country the strength,
power, and riches of the Prince, are but the sum of the force, power,
riches, energy, honour and _susceptibility_, which actually exist in
the mass of his subjects.—But if the Sovereign be the most powerful man
in his kingdom, only because all its strength centers in him; if in
this age, the most complaisant, the meanest Minister should not dare
even to insinuate a contrary idea before the Prince the most jealous
of his authority; how can he presume to think, or to hope, that it
will be in his power to persuade the Prince, that he, the Minister, is
the best informed man in the Empire, before he has collected all the
information that can be got on every object that does not call for an
immediate execution?—And how can he pretend to have collected every such
information, when in addition to his own ideas, he goes only by those of
the few dependents who surround him, dependents as much on their guard
before him, as he himself is circumspect before the Sovereign, when the
Sovereign, before he asks his advice, has the misfortune to let a single
word escape that betrays even the appearance of an opinion on the object
under deliberation?
_Recapitulation of the foregoing Thoughts on Taxes and their Effects._
The fate of the various kinds of taxes, is similar to that of political
operations, which pretty regularly bring about the very contrary of what
had been expected from them: thus if you tax the consumption of the rich,
presently the poor alone will pay the impost, and will continue to pay
it till an insurrection will make you sensible that he is brought too
low; now this insurrection is commonly the consequence of a trifling
scarcity, which, it seems, Providence sends to the unfortunate in order
to encourage his asking for justice, in the only manner that is likely
to prove successful: on the contrary, let the tax be laid on the general
consumption, without sparing that of the poor, the man who possesses,
shall be, no doubt, necessitated to pay for the man who has nothing, if
the former wishes to enjoy the labour of the latter; and on the very same
day, when the tax is laid on the consumption of the labouring man, he
will not hesitate to demand an increase of wages to the full amount....
How is he to be deceived?—If it be well to deceive the poor as long as
possible, then tax nothing but the consumption of the rich. But whatever
be the manner in which the impost is laid, as soon as its effect shall be
general, the burden will prove _null_ (SAVE THE INJURIES INSEPARABLE FROM
ALL OTHER TAXES, BUT THOSE THAT BEAR UPON CONSUMPTION): this effect is no
more than a general advance in all the prices: an advance, it is true,
already acknowledged necessary with regard to the taxed articles, but
dreaded hitherto in regard to all the rest, _where it ought to have been
wished for_; universally felt, but never justly estimated; the _nullity_
of the burden of the debt would have been determined by the estimation.
The poll-tax, _supposed to be established by Divine Justice_, would
enhance the price of labour, and of its products, but by a fraction
equal to that which the amount of the tax should be, in the mass of both
revenues, land and industry. Ten millions of a poll-tax on a revenue
of 120, would increase the prices of every thing by one twelfth; and
every man thus taxed, would evidently after the advance of prices, in
consequence of such a poll-tax, find himself in the very same state he
stood in before the tax; yet one twelfth more must be given for every
thing, but then one twelfth more would be received for every thing.
All other kinds of taxes, as well as the poll-tax, seem to affect only
the article on which they are laid; but this article comprehends the
three interests, and trebles the action of the tax when the interest of
the labouring man, that is, the price of his day’s work, constitutes,
as it does in _England_, nearly one third of the revenue.⸺How could it
be supposed that the taxing of industry in its products, was granting
to its _capitalist_ the _right_ of increasing his price by the whole
amount of the tax, without making it _necessary_ for the land proprietor
to enhance the price of his commodities at the same rate? And how could
it be supposed that the products of agriculture and industry, happening
to be, by a very just re-action, (whether it originates with the one
or the other), increased in price in the same proportion, agriculture
and industry should not be compelled to increase of course the price
of labour which procured those products? If therefore you advance by
10 millions, the prices either of all the productions of the earth, by
taxing agriculture, or of all the productions of the arts, by taxing
industry, you equally compel the untaxed part to advance its prices to
the whole amount of the 10 millions laid on the corresponding part,
_otherwise goods to the amount of 10 millions would evidently remain
unsold_. Now the influence of those new prices will enforce by degrees an
increase on the price of labour, and this increase will soon be followed
by a fresh one on the value of its products; whence it appears at last,
that after all the necessary re-actions, the same tax of 10 millions,
which by a general _equitable_ poll-tax, supposed _as equitable as it is
IMPOSSIBLE to make it so_, would only raise the prices by one twelfth,
or 8⅓ _per cent._; if laid, either on the land, or luxury, or general
consumption, would necessarily advance the prices, sooner or later, to 25
_per cent._; the very precise period whereat every one would find himself
in the exact state in which he was previous to the tax, paying, it is
true, every thing 25 _per cent._ dearer, but being himself paid 25 _per
cent._ dearer too.
Alter the proportion of the usual price of labour, by supposing a country
so far barren as to make it necessary to appropriate one half of the
revenue to the labouring people; in such case a tax of 10 millions laid
on a revenue of 60 would increase by 30 _per cent._ the price of labour,
and of its products; 30 _per cent._ would raise the revenue from 60 to 78
millions: now 39 being the half of 78, as 30 is that of 60, the burden of
the tax would then prove equally _null_, after every article should have
been raised 30 _per cent._
Alter again the proportion of the common price of labour, by supposing
that the cultivator is allowed only one fourth of the revenue; this
division may take place in a country extremely fertile; in this case, a
tax of 10 millions on a revenue of 60, would only add 20 _per cent._ to
the former prices; instead of raising the revenue of 60 millions to 75,
as in the case of three equal shares, or to 78, as in the supposition of
the revenue being divided in halves, the tax would then carry it only to
72. Now the 4th part of 72 is 18, as 15 is the 4th of 60; therefore if,
after the tax is imposed, you give 18 wherever you paid only 15 before
that period, the burden will clearly be _null_ again, since the increase
in the price of labour, must have followed the advanced price of its
products, an advance necessitated by the impost.
Here, methinks, I hear the enthusiasts exclaim, _How! the fertility of
the land is then of no advantage, but to its greedy owners!_—I am in
hopes that before I conclude this Pamphlet, I shall be able to find,
to the great satisfaction of all good men, how many advantages remain
in the hands of the most opulent land proprietor; nay I hope to prove
that in a fertile land there is nothing lost to any of its inhabitants,
unless _extraordinary efforts be used to concenter within that spot the
general benefit which must result from it_. I shall content myself at
present with requesting the reader to compare my thoughts on the taxes,
with the two following problems, so often debated both in _England_ and
in _France_. How is it that _France_ has constantly retrieved her errors
and her misfortunes? How comes it that _England_ has not yet sunk under
the burden of her taxes? The _French_ exciseman says: _It is because the
more the people are loaded, the better they walk_; and very sensible
men in _England_ used to say, “_Reason and experience_ seem to prove
that taxes stimulate industry, and that the poor, _to live as well as
before, perform more work without demanding more for their labour_.” (_D.
Hume_’s Essay VIII. on Taxes). It seems to me that the above two problems
are more humanely solved by the reasons I have produced, and that those
reasons destroy all idea of a miracle, or of the necessity of loading
the people in order to spur their industry, and encourage them to work:
on the contrary, to forward those two great points, it is necessary to
increase the price of their labour in the same proportion as that of
its products is raised by the taxes; and this will suffice to render
evidently _null_ the burden of all taxes whatever.
_Further Considerations on the Necessity of a Correspondence between the
Prices of Agriculture and those of Industry._
I have said it more than once, and beg leave to repeat it here: Let any
essential object be denoted by one number or another; it is a matter of
perfect indifference, provided the numbers intended to denote the _mass_
of objects corresponding thereto, do not present any ideas contrary to
the proportion of labour which exists between the _essential object_,
and the mass which is to form its balance. Thus then, be the value of
wheat, which serves as the general standard, because it is useful to
all, at all times, and which ought to be so, from another consideration
almost equally powerful, namely, that it constitutes about one third
of the landed revenue in _Europe_—be its value, I say, denominated 30,
50, or 25, nothing more indifferent, provided the numbers denoting the
value of the other products of land and industry, keep exactly, either by
more or by less, within the same proportion; it is clear that, in such
a case, neither the land proprietor nor the _capitalist_ of industry,
can undergo from the alteration in the numbers, any real alteration in
their circumstances. But to think of nothing but the manufactures, and
imagine it possible to maintain, and endeavour seriously to maintain,
wheat at the same price, whilst the taxes advance by 10 _per cent._ that
of the products of industry,—is to aim at the ruin of agriculture, and to
oblige all the proprietors of land and money, whose employments in the
State would not indemnify them for such an injustice, to go in search of
another country, where the manufacturer, better acquainted with his real
interest, would know, or act as if he knew, that the solidity of his
wealth is inseparable from that of the land proprietor, and from the ease
of the proprietor of money, and of the labouring man.
_Then_ perhaps those national manufacturers, so proud and so jealous of
their exportations, so greedy of premiums, prohibitions, restrictions,
encouragements of all kinds, would sue more ardently to have those
nuisances suppressed, than they ever did for their establishment.
Nothing more admirable than those regulations to which _England_
acknowledges to be indebted for the best part of her wealth and power;
but they crept in at a time when ignorance generally prevailed, when all
the other parts of _Europe_ had almost no idea either of the principle of
commerce, or of its influence over all the other resources of society.
In effect, from what known point could one then start, to imagine that a
nation, who openly countenances monopoly at home, in order to encourage
her foreign trade, lays the most solid basis for the monopoly she wishes
to secure to herself every where? How was it possible to conceive that
the _Dutch_, a nation so necessary to those that are deficient in means,
and so forcibly compelled by the superabundance of their own, to make
them serviceable to those who stand in need of them, could not be shut
out from the _English_ ports, without depriving the rest of _Europe_
of the advantage, which their admittance every where was necessarily
calculated to procure to their correspondents, by securing to them, _as
well as to England_, a competition so essential to all, and fatal to
monopoly alone? _Europe_, busy at that time in search of another sort
of equilibrium, did not consider what weight commerce, carried on upon
such principles, would throw into one of the scales; how could _Europe_
then suspect that it would overthrow the balance entirely? But what is
the final result of all these projects against Nature?—The pretensions
of the Ecclesiastical State stirred up all _Europe_; _and the Pontifical
See was fixed in its proper place_. _France_ roused all _Europe_ against
the ambition of the House of _Austria_, much more formidable by its real
power; _the Imperial Throne was fixed in its proper place_, and _France_
was hailed as the founder and assertor of _European_ liberties. Soon
after the Protectress became a despot; _England_ stirred up all _Europe_
against her, and _France was, aukwardly, thrown out of her proper
place_; _England_, the principal instrument of the revolution, made an
improper use of her importance, as had been successively done by the
Ecclesiastical Power, the House of _Austria_, and by _France_;—the Armed
Neutrality appeared, and presented a code of laws unheard of before; it
was just; every nation, that had not bowed beneath the _English_ yoke,
adopted it:—there was an instant, when this armed neutrality might have
dictated both to _England_ and _France_, laws as equitable as the code
itself; and all _Europe_ would have applauded, had even _England_ and
_France_ united, at that very instant, to exterminate in concert the
whole naval force of _Europe_, then burnt the exterminating fleets, and
themselves given to all the world those very laws of equity which were
intended to be imposed upon them.
Every thing, at this moment, is in that happy state, which gives time to
reflect upon what is past, to see what is present, to look forwards to
what is to come, and to consider an _ensemble_, the very idea of which
could not be admitted during former periods. A few clouds, dispersed here
and there, do not spoil the beauty of the horizon; no body can now, for
any length of time, think it his interest to ruin and destroy; and every
body is concerned not to suffer any thing to be destroyed. I return to my
subject, if I may be said to have deviated from it.
If a diminution in the price of the necessaries of life be looked upon
as so very important, there exists a sure method of effecting it, even
in _England_, without any detriment to the land proprietor. Let us see
whether this very method would prove injurious to the true interest of
the manufacturer, who must be patronised, cherished as the fountain head
of riches; I mean that kind of riches called _money_, which could not
long subsist without the riches called _wheat_.
_Fourteenth Hypothesis._
Let us suppose, that, by the suppression of the monopoly enjoyed by the
manufacturers, and of which they are so jealous, the price of the whole
of their goods should fall one tenth; in such a case, the wheat which
the new taxes will enhance in price, I suppose, in the proportion of 40
to 44, would, upon a medium, fall back to 40; and in this case again the
produce of the manufactories would only cost industry 20 instead of 22,
at which they will be rated when wheat shall have risen from 40 to 44;
for, in the latter supposition, it will be necessary for industry to
pay finally this increase of expence, in favour of the artificers, who
would not long submit to an injustice, without presenting _petitions_ in
their own way: just as wheat must indispensably rise from 40 to 44, in
order that the land and money-proprietors be not compelled to leave their
country, to the great prejudice of the internal consumption, so essential
to the truest interest of the manufacturer.
Let it then be supposed, that wheat should fall from 44 to 40, and so
of all the rest;—I confess that the proprietor of money would thereby
become a gainer, and that the general persuasion is, that it is salutary
he should lose: but would he long support his gain? Would not the
encouragement which every thing must derive from this new order of
things, from that activity which trade would find in the new channels
that would open every day, when commerce should build on that true
principle, acknowledged to be the only unerring one, _the exchange of
commodities_, (excepting the bullion required for the five articles
before mentioned)—would not that activity, I say, that encouragement,
inspire in all parts of _Europe_ an eagerness for labour, necessarily
followed by an increase of _real_ wealth, a creation of new productions,
and by an increase of that _imaginary_ wealth, still more stimulating
than the former, because it is its proof and its pledge, but which cannot
be obtained without a general increase in all the prices?
Will it be said, that, on the first moment, the fall of prices would
affect the intellects of those who can only see, but never compare? that
the people, for instance, would lament their being reduced to 10, from
the 12 they had been accustomed for some days to receive, although they
should pay only 5 for what cost them 6 before? In this case, keep up
the prices, but without exception, and export on the true principles of
exportation: take for your guide the example set up by my countryman, the
_American_ of _Philadelphia_, in selling dearer because you are compelled
to do so; propose to buy dearer also, and this will be only an act of
justice; you will see hereafter that you would at last be just, in spite
of yourselves; be so intentionally: you cannot come down to the price of
your purchasers; raise their prices to a level with your own, they will
observe that even the first profit is not the lot of the first bidder, if
every one doing justice to himself bids in proportion: mean while, the
eagerness for labour goes on increasing, and by little and little the
benefit extends to the lowest wretch that dwells in the community; he
finds more work to do, and a greater reward for it.
It will be said no doubt, that this is another supposition of a general
agreement.—No, certainly not; it is enough for every one to see that
it must be so; that it will happen without any other help than the
private interest of each individual; that these private and niggardly
measures, already taken, or to be taken, in order to prevent the result
of all those personal interests, are of no use but to keep justice at a
distance; to multiply the number of injuries which daily take place, till
what must be, comes to pass; to produce a greater evil, where it might be
less; to substitute _forced_, to _necessary_ prices: but it is so evident
that wheat, and all the productions of the earth, should increase by one
tenth, as soon as the taxes, or an accession of wealth, shall increase by
one tenth the price of the products of industry, that it is necessary to
lay this principle as the basis of all regulations, _or else openly to
adopt as a maxim, that agriculture should be sacrificed to industry_.
This maxim, I set forth of the correspondence required between the
prices, together with the inconvenience of having them too much out of
proportion with those of other nations, militates, it is true, against
that monstrous system of prohibitions, corporations, &c. which is the
only burden entailed upon us by our forefathers, _the only burden_
which the present legislatures can transmit to posterity; but although
it might be an absurdity to suppose a reform as sudden as it would be
advantageous, yet would it be less absurd to suppose that, the evil
being once found out, the remedy will constantly be rejected? Would it
be less absurd to suppose, that the manufacturers, better acquainted
with their real interests, will persist in endeavouring to aggravate the
evil, instead of complying with the only means of retrieving it? Would
it be less absurd to suppose, that each of them will never perceive that
he pays for the privilege of ransoming in his branch of industry, by
the disadvantage of being himself ransomed on a thousand other objects?
_Russia_, 30 years ago, was perhaps more distant from her present state,
than the unmasking of monopoly, and the knowledge of its effects, will be
from its extirpation.
_On a Cause little suspected of high Prices._
I am not ashamed to own the prejudice I entertain against a diminution
in the price of any thing whatever, when I observe that discouragement,
at least in the part affected, would be the consequence of such a
diminution; whilst, on the contrary, a gradual, general, and proportioned
advance in the prices of every thing, is constantly followed by a
greater activity in all the branches of labour, which really increases
the quantity of its productions, in a proportion far superior to the
advance on that imaginary, _nominal_ value, acquired by fermentation;
my intention, therefore, cannot be to declaim against one of the most
potent causes of the high prices prevailing in _England_, and which
nobody, I think, has yet mentioned. This last expression shews, that I
do not mean here, that quantity of paper-money, to which many people, in
more than one kingdom, ascribe all the evil, of which the sole real part
is the work of monopoly. I think I have proved, that it is impossible
there should long remain in circulation any paper above the necessary
quantity: all would flock to the Bank to be paid in cash, had not the
Bank enough of it to discharge her notes, when presented, with such
readiness as to leave no doubt of the validity of those other notes,
which, in the natural course of things, would not be presented there to
be paid in money. The Bank would derive very little advantage from the
momentary cheat of paying off large sums in sixpences; this legerdemain
is admirable, but can suffice only to correspond to the wanton tricks
sometimes played by great politicians, to give the Bank a momentary
trouble. It is, _then_, necessary to rock those children, whom great men
make it their amusement to scare; and they must be rocked till they are
fast asleep, or till the great men are tired of making faces at them.
After the farce is over, the children wake, and do not even remember to
have been frightened; money is found wherever it is necessary, and every
thing returns to that order which it is every one’s interest to maintain.
What then is that other cause, so active, so cogent, not of that
extravagant price which monopoly alone can occasion, but of that price
rather above the _necessary_ one, which gives to every thing an increase
of vigour? It is credit. It is that prodigious talisman which realises
all that it conceives, since all that it conceives has the same advantage
as reality. How many capitals would never have existed, had not credit
supposed them several years before they did really exist? How fill up
the real chasm of capitals, which may, in an instant, suspend a hundred
manufactories in a kingdom, and, by that suspension, ruin, starve, the
trader, the merchant, the manufacturer, the mechanic, all, except the
farmer, whether proprietor or tenant, who, by the counter-blow, could not
die of hunger, but in real misery on his stacks of wheat, which he would
no longer attempt to reproduce.
That man is ignorant of his own value, who, pen in hand, weighs,
calculates, measures time, distances, expenditure, obstacles, facilities,
occurrences; and whose signature, on account of the supposed exactness
of his combinations, will soon after produce, at two or three hundred
leagues distance, and in fifty places on the road, the same effect which
would have resulted from the real possession of the object of which
this signature is the pledge. If he shares with all those whom he makes
easy, re-animates, or puts in action, the benefit which they derive from
the speed, as well as from the supposed certainty of his operations,
undoubtedly no one will dispute his title to the reward; and yet we shall
see presently, that this medal is not without its reverse, _supposing an
advance in prices to be an inconvenience_.
I shall apply the principle to a fact very well known in _England_.
In the year 1762, about 2000_l._ sterling, carried to the island of
_Grenada_, was there received with that veneration due to gold when we
have been years without seeing any, and have not yet forgot its virtues.
The above sum regulated the markets; coffee was set up at eight or ten
pence _per_ pound; sugars sold _per_ quintal thirty or forty shillings
currency; the inhabitants were in perfect ecstacy: I shall say nothing of
the device practised in order to _hook in_, by means of those 2000_l._
about thirty times the value of that sum, and yet satisfy every body:
that is foreign to my subject; but I will say, with pleasure, that an
honest gentleman, moved at the distressed situation of another who was
dunned by merciless creditors, gave him in hard cash a trifling part
of the sum he wanted, and for the remainder furnished him with his own
bills of exchange on _London_, assuring him that those to whom they might
be presented would take them for cash without any demur. Those bills
had fully the promised effect; the same gentleman obliged several other
persons; the benefactor soon met with competitors, all difficulties
disappeared by means of scraps of paper on _London_, and the debtor who,
on the landing of the precious metal, had deemed himself too lucky to
sell his coffee at ten-pence and his sugar at 40 shillings, now offered
impudently his bill on _London_, indorsed by some patron, if a creditor
refused to give him 45 shillings for his sugar, and twelve-pence for his
coffee.
Gold, attracted by the first homage paid to it, came in plenty, and
fell in value by the establishment of credit; it afterwards took
another course, and went, no doubt, somewhere else to supply the want
of credit, and pave the way to it. From that moment very little money
came to _Grenada_, and no one ever wished for more; but then the price
of commodities was advanced, and the readiness with which goods, to the
amount of several thousand pounds sterling, were delivered to such a
planter as, six months before, would not have presumed to demand the
sixth part of them, did not permit him to start any objection against
the prices set on the goods he stood in need of, when he thought himself
indemnified for the excess in those prices, by that at which his
were rated, _and by the time granted him to make good his payments_.
The _Grenadians_ abused this credit, as they did in _Scotland_, and
unfortunately at the same period. But this is not the matter in point;
the present object is, that the establishment of credit in _Grenada_
enhanced the price of every thing there, and that the encouragement
and activity resulting from that increase doubled, in the space of six
years, the real quantity of the products in that colony, whilst credit
had, in the end, increased its nominal value hardly one tenth. In 1764
the exports of _Grenada_ amounted to 206,889_l._; in 1770, they were at
433,421_l._; two years after, they rose as high as 492,974_l._: it may
be added, that in _England_, thanks to the extension of that miracle
wrought by credit, the benefit arising from those new products, and the
necessity of furnishing the balance thereof in merchandise, propagated,
if I may be allowed the expression, from county to county, the necessary
means of _consuming_, that is to say, of _realising_, that augmentation
of wealth, whose price was constantly kept up by the additional
consumption of all kinds which followed it: such is the usual chain.
In effect, do but observe how easily a creditable merchant buys from
the manufacturer, payable at twelve months, an enormous stock of goods,
which he is himself obliged to sell, either to the consumer or to the
retailer, at twelve, eighteen, or twenty-four months credit, and which
often are not totally paid for at the end of three years. What difference
in the prices must be the consequence of that series of _facilities_! Are
high prices an evil? Put an end to credit, nothing more easy; nothing
more is required, than to suffer to lie dormant all those laws, which
secure to the creditor, the payment of his advances at the precise time
when they become demandable: it is that certitude of being repaid, at
the needful hour, that often induces the creditor himself to borrow, in
order to extricate a debtor, whom he knows to be indiscreet, but from
whose custom he derives a considerable yearly profit, upon a prodigious
consumption; a profit he would lose, by being less indulgent: take away
from the creditor the certainty of extorting his repayment, if it should
be refused at a moment when a critical event should render such rigour
indispensable, credit is destroyed, _as well as_ the consumption which
followed it, _as well as_ the production of the earth which could not be
paid, but by those manufactories annihilated by the want of consumption:
cross the Straits of _Calais_, and (in order to console the _worshippers
of the balance_) add, _as well as_ thousands of acres of vineyards in
_France_, the produce of which _strips England_ annually of so vast
a sum! _as well as_ thousands of acres in _Italy_, set apart for the
rearing of silk-worms, and the culture of olive-trees, which swallow up
a prodigious sum of _English_ money; _as well as_ thousands of acres
in _Silesia_, where they cultivate the hemp which _English_ money buys
in that country; _as well as_ thousands of acres in _Russia_ and in
_Sweden_, whence we are obliged to import, at the expence of so much
_English_ money, that immense quantity of timber, iron, canvass—articles
which would become useless by the extinction of credit, and the
destruction of that trade, of which credit was the very soul;—the chain
would lead us too far. It is sufficiently evident, that then all the
goods remaining unsold could not be purchased but with ready money, and
_then_ indeed every thing would be excessively cheap. Would all that be
for the best?—In a word, give up all thoughts of riches, or submit to the
highest prices; but let those high prices come to you from the profusion
of wealth universally diffused, and not from the tyranny of your own
monopoly.
_The happy Issue of a desperate Combat between Monopoly and some private
Interests._
The scene of this combat does not lie in _England_; we have seen that
there they think of nothing more than to keep the balance even, and make
up, as fast as possible, each in his own department, for the injustice
granted to the importunity and cupidity of others, without any other
inconvenience arising therefrom, than that of having a very large
surplus, excessively dear, and that of not being able to procure what
is wanted at the lowest rate, nor of the best quality. Even Smuggling,
which follows certain regulations, with bludgeons and pistols in hand,
cannot produce any great effect on the sum of national labour, though it
may perhaps considerably influence the revenue of the Exchequer; it is
probable that the smuggler exports as much _English_ work into _France_
as he imports of _French_ work into _England_; and that, in this respect,
the gain of the most fortunate individual comes to very little: my
intention is, to speak here of a combat, which has lasted a hundred years
between the _French_ FAIR trader and the _American_ smuggler.
The system of administration adopted under Mons. _Sartine_, for the
_French_ colonies, a system, for which they are indebted to ten years
labour of Mr. _Malouit_, the present Intendant of _Toulon_, permits us
to speak now of that combat, and to descry the dawn of a more serene
day, opening upon those colonies; till then, I should not have hesitated
to call them unfortunate, _in regard to their means_, if the private
interest of the inhabitants, as well as that of the general-officers,
Intendants and Directors of the Domain, (interests never combined but
amongst the latter) had not moderated the effects of that dreadful
punishment the galleys, denounced at the request of the _French_
merchants, against any one who should presume to import a negro or a
cheese from the _English_ islands into the _French_ colonies, however
good the one, however industrious the other might be; and whatever
advantage might be gained by paying for both in molasses which the
planter was obliged to throw away, _because the French merchants would
not buy it_.
It is true, that the humanity of the _great_ smugglers has often suffered
the _little_ ones to escape, before or after sentence, (the negro and the
cheese being duly seised); and that a dozen of the little smugglers whom
the policy of the great ones sacrificed _by installments_ to the clamours
of the merchant, were nearly the only victims of that barbarous law, the
strict execution of which would have deprived _France_,
First, Of the fifth part, at least, of the present revenue arising to her
from her colonies;
Secondly, Of all those branches of industry to which such an addition of
revenue gives constant life;
Thirdly, Of all the profit which the _fair_ trader, the instigator of
that barbarous law, gets annually on the importations and exportations
which that additional income requires;
Fourthly, Of the duties which the King’s treasury receives directly, or
indirectly, from the one and the other; (it is impossible to estimate
this article.)
Fifthly, and in fine, of the assistance which the State derives for
the Royal navy, from that increase in its trading one, which became
necessary after the increase of a revenue, due to people who should have
been sent to the galleys, had they been caught in the flagrancy of such
a crime. One half of the cotton and coffee which is gathered at _St.
Domingo_, _Martinico_, _Guadaloupe_, and _Grand Terre_ above all, owes
its existence to negroes, constantly furnished to the _French_ smuggler,
both great and small, by the _English_ merchant, the natural, _and as
it plainly appears_, the necessary enemy to _France_ and her trade;
the quantity of sugar and indigo which in the said colonies owes its
existence to the same means, is much more than necessary to make up that
fifth of the revenue, the glory of which may be claimed by the smuggler,
though the _fair_ trader comes in for a share in the profits.
Any one desirous to have this fact confirmed, may be informed of it by
nine tenths of the _French_ planters, provided they be taught that the
time is now come, when every useful truth may be spoken, even with
energy, when accompanied by decency. This once ascertained, he is no
native of _America_ who will refuse his evidence; an _American_ believes
in every thing that is just and reasonable, the very instant that it is
pronounced.
I sincerely wish that smuggling might produce in _England_ the same
good it has done to the _French_ colonies; this would appear to me very
just, and the more so, since it will not be the fault of the _British_
commerce, if that blessed contraband, after having given life to
_America_, does not spread the same animation every where, _Great Britain
excepted_. I have heard an _English_ manufacturer prove at the bar of the
House of Lords, that his manufactory was in want of a special patronage,
by so much the more, as the size and brittleness of his ware made it a
difficult point for him to smuggle it over to the continent, and as a
duty of 30 _per cent._ had been lately laid upon it, in the two countries
where it concerned him most to have it exported. Amongst other questions
that were put to him, I remarked four, which would have stunned me, had
I been in his place. One of these questions was as follows: “Have you
not heard that that 30 _per cent._ of which you complain, was laid in
consequence of some prohibitions, or extra duties imposed in _England_
on some articles imported from those very countries which you allude
to?” I could make nothing of the manufacturer’s answers; they were so
long-winded, they had been so carefully studied, they were so very full
of a policy which I do not understand, that it became impossible for me
to class them under any heads in my memory.
_Reflexions on a very strange Revolution in ~France~._
A General maxim, almost universally adopted beyond contradiction, and the
foundation of an hundred regulations, enforced from pole to pole, is,
that it is essential for all national commodities to be at the lowest
price, in order that foreign trade may turn out to the best advantage;
that is to say, for the native traders to be able to dispose abroad of
the products of national industry, at a cheaper rate than any other
nation can sell those of her own. Certain it is, that the less price
national commodities will bring, the less of the products of national
industry will be necessary to pay them off, the more of course will
there remain of those products to stock the foreign markets, and the
more also will the foreign purchaser be gratified by the reduced price
at which they may be given, to the detriment of the land proprietor of
the nation; this is so self-evident that it cannot be withstood. This,
methinks, is carrying to an excess the principles of Christian charity,
if the Legislators are land proprietors; it is a shameful abuse of power,
if the Legislators are at the head of manufactures; and in either case
one must be blind to the necessity of keeping up an even balance between
agriculture and industry.—_Had not Nature militated under hand, and with
some advantage against the dreams of speculators in this respect, and
against the much more dangerous surreptions of cupidity, to what state
of abjection and misery would not agriculture be now reduced in all
countries!_
I have said, that the price of every thing would perhaps be now in
_France_, very little different from what it was 40 years ago, had it
not been for an eventual circumstance, (I might have said a regulation,)
which a few years ago tertiated, at least, the fortune of every subject
in that kingdom;—nominally at first, it is true; but afterwards in
reality, owing to the prodigious encouragement that ensued; I mean the
regulation which permitted the exportation of wheat, and authorised each
of the _French_ Provinces not to consider herself as a stranger to all
the others. I shall only make a few reflexions on a matter which might
furnish enough to fill a volume.
First, The adopted maxim of the pretended advantage of enjoying the
national commodities at the lowest prices, _for the better encouragement
of industry_, was not held less sacred at the time the regulation took
place, than when that maxim was considered as the basis of the system of
exportation _the most advantageous to the kingdom_, and the condition
(_sine quâ non_) of the many wonders that might be expected therefrom,
towards an increase of wealth.⸺Yet if there exist a regulation calculated
to operate in diametrical opposition to the _sacred maxim_, it is clearly
the freedom of the corn trade; to be convinced of this truth, one need
but attend to its effect in _France_. The little success I have met
with in my endeavours to come, in this respect, at some particulars
which might perhaps have given me a few ideas, confines me to what I
can gather from recollection; but with truth I can say that my memory
seldom deceives me on the abstracts it presents to my mind. The reader
may perceive, that the summary I now stand in need of, has no manner
of connexion with the little springs that were put in play to ruin the
author of the scheme; the chief and true point, is, that all secret
intrigues, all public combinations, ended only in occasioning a reform
in what was deemed abusive, in a regulation the advantages of which
were fully demonstrated; and that the price of wheat, after having
tertiated, doubled, trebled perhaps by the help of the forestallers,
from whose abilities were expected the repeal of the law and the fall
of its devisers, was fixed at last between one half and three fourths
above the price, as it was upon the medium of ten years preceding the
regulation. It is easily conceived that the price of wheat dictated that
of all other commodities; in effect, previous to the last war, the only
decisive period in the present point, the nominal revenue of the lands
in _France_, increased by one half at least of what it was 15 years
before;—then, commodities were, upon the whole, dearer by one half; yet
the maxim was held _sacred_ still, and is not less so at the present
time—in _England_ as well as in _France_;—nevertheless I can see no
medium; either the maxim is absurd in itself, or _French_ industry has
lost one third of its benefits by a regulation which tertiated, almost
suddenly, the price of all productions in _France_.
Secondly, In order that industry may be said to have lost that third, the
increase of revenue, yielded by the land to its proprietor, must have
been cast into some national _vortex_, or sent into some foreign one, or
concealed in the earth by the suspicious proprietor; for if the surplus
of the landed revenue has occasioned a greater demand for and consumption
of the products of industry, and more culture of the land, industry, by
raising the price of her goods on the very first increase of the demand,
has obtained in the first year, her first share in that accession of
wealth; and she could not miss the second, so soon as a larger sum of
savings bestowed upon the lands, had brought about what they never fail
to produce, I mean, more productions, and soon after a greater demand for
goods, and _soon after_ again more goods to answer the additional demands.
Thirdly, If that sudden advance in the price of provisions, ended only
in an increase almost equally sudden in the price of the products of
industry, there could not be then any inconvenience, either to industry
or agriculture, in a sudden and proportionate rise which preserved
the former equilibrium, and presented the same correspondence between
the two revenues; (the only thing that can materially affect the two
_capitalists_, though neither of them think about it.)
Fourthly, If there has been no inconvenience in so considerable but
proportionable increase in the prices, _coming from agriculture_, where
could be the inconvenience in a proportioned increase, equally sudden and
general if _it should come_ from industry?
Fifthly, What difference can there be between a regulation which raises
the landed revenue in a kingdom, from 6 to 9, followed by a re-action in
industry, which raises equally to 9 what usually went for 6; and another
regulation which would begin the same operation in industry, and should
be equally followed by a proportionable re-action in agriculture?
Sixthly, When, by a regulation respecting the corn, industry is at
liberty to enhance the price of her goods, in the same proportion as
the effects of the regulation have raised the products of agriculture,
cannot a regulation that concerns or imposes taxes, and by which
industry is forced to increase her prices by the full amount of the
taxes,—cannot such a regulation, I say, permit the cultivator, without
inconvenience, to advance the price of the productions of the earth, in
the same proportion as the taxes, or the regulation concerning them, have
increased that of the products of industry?
Seventhly, Let us suppose that the operation is effected, and followed
by the sum of money which a nominal revenue, grown more considerable,
requires for the circulation; can there exist then the most trifling
difference between the present state of any individuals in the nation,
and the state they were in previous to their being loaded with that
enormous burden, called taxes?
Eighthly, If after enquiry, the only answer that could be given should be
a negative, would it not be profitable to let the public into the secret,
in order that after having observed a very singular analogy between a
young nymph loaded with a column of several thousand pounds weight of
air, each of them as heavy as if it were of lead, and the _French_ as
well as the _English_ loaded annually, constantly, in the same manner,
the one with 600 millions of _livres Tournois_, the other with 14 or
15 millions of pounds sterling, they should be led further to observe,
with what agility, what graces, what sprightliness, the young dancer
plays with her load—“trips it along on the fantastic toe,” and with what
grimaces, what groans, what lamentations, the two vigorous nations shrink
under a burden which is not more sensible than air, from the instant that
it is as perfectly divided?
I must here go some steps back:
Ninthly, If the nullity of the burden depended on the equality with which
it should be divided, and if this equality should depend on an addition
to the supposed burden, might it not be expected (not from the tricks of
customary seduction, or from the shorter method of authority, but from
all the means calculated to enforce conviction) that the nation would
find herself less aggrieved by an additional tax, which would tend to
equalise the weight, than she could be by an increase of taxes laid for
the purpose of effecting a reimbursement, which, upon a second thought,
no one can wish for?
Tenthly, Before the regulation alluded to, wheat was, in _France_, one
third or one half cheaper than it is at this day; the rest of the other
productions of the earth stood in the same proportion: in _England_, at
that very time, the price of wheat differed very little from what it now
is. How could _England then_ maintain a competition—a combat, as it were,
of exportation, against her _natural_ enemy (the _French_ industry), so
lightly, so advantageously armed by the low price of the commodities in
_France_?—If the maxim is as just as it is held _sacred_, surely _France_
must have derived a prodigious benefit from the barricadoes by which the
exportation of wheat was prevented, even from one Province to another,
in order that it should be in all at the lowest possible price:—it
follows also that _England_, already compelled by her taxes, her internal
monopoly, and her riches, to raise the price of her wheat at home, must
have undergone dreadful inconveniences, by availing herself, as she has
ever done, of the least dearth abroad, to make that very wheat dearer in
_England_, whilst she was going to diminish its price wherever scarcity
had made it excessive.
Eleventhly, If _France_ has obtained such wonderful advantages from
her internal as well as external barriers, it is not in respect to her
agriculture; her agriculture has clearly lost, not only that part of
the value in her productions, of which she was daily deprived by this
barrier, but also the encouragement which a gradual increase in the price
of the productions would have occasioned, to increase their quantity: it
is therefore by the exportation of the products of her industry, which,
being sold at a price below that of all other nations, have procured her
in money that prodigious balance of exported goods, _which the wretched
state of the national cultivator did not permit him to pay for_:—but
observe, that the _French_ exportation, carried on with that advantage
(pretended to be so very considerable) of the low price of national
commodities, brought no more money to _France_, than that which she
wanted for the five articles I have mentioned before, when treating of
the balance of _England_. This matter I hope I shall set in the fullest
blaze of evidence.—But, on the other hand, observe also that _England_,
by an exportation carried on with the utmost regularity, under the
supposed disadvantage of her commodities being rated much higher than
those of her competitors, a rate which she even increased herself, by
the exportation of wheat, which she encouraged by premiums—_by premiums,
destructive of the sacred maxim_; observe, I say, that under that
disadvantage, in spite of those inconsistencies, as fortunate as they are
real and palpable, _England_, nevertheless, has not failed to procure the
money wanted for the five articles, the only ones that can give any value
to money.—Shall it be said that _France_ would have obtained a balance
in money much less considerable, if she had not kept her prices so low,
if she had acted with less respect to the maxim?—Shall it be said, that
the balance in money would have been far more favourable to _England_,
had not the price of her commodities been so high at home; if she had
more consistently acted upon the maxim; if, above all, she had prohibited
the exportation of wheat, which is so often lamented, and even sometimes
so loudly complained of by her manufacturers?—This indeed would be to
appropriate great merit to the resource of hiding money under ground,
when we cannot flatter ourselves with the thoughts of having too much of
it, but at the expence of agriculture: but no matter; let us see whether
the inference be just.
Twelfthly, Had _France_ been indebted to the disparagement in the prices
of her commodities, for the advantage of procuring the money wanted for
the five articles before mentioned, she would have found herself in the
impossibility of answering that want, as soon as, by the new regulation,
those commodities were restored to their natural value, as soon as the
liberty of exporting wheat had raised its price almost to the level of
that which it bore in _England_.—Now will it be said, that ever since
the landed revenue in _France_ has risen from 40 to 50 _per cent._ by
an advance in the price of commodities, less bullion has been spent by
the _French_ in plate, in gilding, and other articles of luxury?—Will
it be said that _France_ stood in need of the money necessary to
settle in cash with her foreign correspondents, when this resource
from circumstances became preferable to the mode of paying in bills of
exchange?—Will it be said that she fell short of it for all those Jewish
and miserable operations, or for that reciprocally beneficial smuggling
with her neighbours?—Will it be said, that her circulation, which,
beyond any doubt, required a more considerable mass of money, as soon as
her revenue had tertiated, has suffered by that necessity of a higher
balance, become impossible (according to the maxim) as soon as it grew
indispensable?—Will it be said, that her industry has lingered away as
soon as her agriculture has been more able to enliven it?—Yet all these
absurdities must be admitted, or it must be acknowledged that the price
of commodities may be tertiated, or doubled in a nation, not only without
injuring industry, whose business it is to keep within the kingdom all
the money wanted for circulation, but even with securing to the nation
a more considerable balance in money, since it must become so whenever
the price of every thing is raised one third, and perhaps more than
one half.—The _sacred maxim_ therefore has not even common sense, _when
applied to the internal trade of the State_.
Thirteenthly, If _France_, who has not the assistance of paper-money,
did actually procure so clearly to herself an annual balance more
considerable in money, as soon as she had tertiated her revenue, it
follows that _England_ must, really, have experienced a competition much
more disagreeable, from that very circumstance from which, _according
to the maxim_, she had less reason to fear it; for whilst the price
of commodities was below _par_ in _France_, it is clear that having
no _national vortex_, she required less money for the circulation of
a revenue of 100 than for one of 150: it was therefore more to the
advantage of _England_, _in spite of the maxim_, that the commodities
should be at a low price in _France_, than to have them raised 50 _per
cent._ The _sacred maxim_ then is destitute of common sense, _when
applied to foreign trade, to the competition abroad_.
Fourteenthly, But if the circumstance which drove _France_ to the
necessity of acquiring a greater balance in real cash, stood at a
very small distance from another circumstance by which _England_
was compelled to procure one still more considerable, for a general
re-coining of her guineas; and if _France_ and _England_ have done each
other no material injury in this kind of competition, (this is proved
by the fact, since both nations have equally and certainly, ever since,
procured the annual balance which they wanted); may it not be fairly
concluded, that _England_ has been no loser, by a revolution in the price
of wheat, which enriched _France_ by tertiating her revenue, and forced
her to receive annually, in cash, a balance far greater than she did
previous to that revolution?
Fifteenthly, Now if _England_, since the revolution in the _French_
prices, has obtained as much bullion as she wished for, or rather
all that which she could lay out on the five articles of her common
expenditure, and for the additional circumstance of a re-coinage, whilst
on the other hand _France_ had all her wants supplied with the greater
ease, may it not be inferred that _England_ could have gained nothing,
even upon the supposition that the annual supply of money, become
necessary to _France_, had been less considerable, that is to say,
even if the _French_ commodities had remained in their former state of
disparagement?
Sixteenthly, If that increase of prices in the landed revenue has not
been restrained to _France_; if it be a fact, as all travellers pretend
to have observed, that all the other parts of _Europe_ have experienced
the same revolution, the same encouragement, the same success, except the
difference produced in some places by the singularity of certain laws;
may it not be concluded, that although _England_ has lost nothing by the
revolution, although _France_ has proved a gainer by it, other nations
have also enriched themselves, namely, one tenth, those where the prices
have been advanced a tenth; a ninth, those where the prices have been
raised one quarter; one half, those where the prices have risen one half,
&c. independently of an increase still more essential, _viz._ that of the
quantity of the productions of the earth, _which always closely follows
that of their prices_.
Seventeenthly, Were one to reflect, that this increase in the prices, in
regard to the productions of the earth, is always followed by a similar
increase with respect to the products of industry, which thereby receives
the same encouragement; if, after examination, no one can harbour any
doubt of the fact; would it be an easy matter, even with the help of
the _sacred maxim_, to persuade any nation, whose prices have been
doubled, to reduce the nominal of her revenue from 20 to 18, in order
to get the advantage in the competition with another nation who, by
some disagreeable circumstances, should have been obliged to raise her
products from 20 to 22, as _England_ is compelled to do? Would not one,
on the contrary, conjecture that every wise nation will follow the advice
of the _American_ of _Philadelphia_, _i. e._ that she will not hesitate
to raise equally her own products from 20 to 22, certain, as she will
be by this means, to give fresh encouragement both to her agriculture
and her industry, and not to hurt in the least the interest of the
nation whom those disagreeable circumstances should have compelled that
rise from 20 to 22; compelled, I say, without procuring for her that
encouragement which cannot spring from such a rise, _but in as much as it
is not necessitated by taxes_?
Eighteenthly, Is it not even probable that every wise nation will be
sensible that there is but one way to carry on, without being constantly
duped, a commerce with another nation, obliged to raise the price of her
goods; _viz._ to raise, in the same proportion, those which are given in
exchange?—This, some will say, is an indirect advice which I take upon
me to give to industry; nothing more useless, will they add; industry
in all countries never fails making that calculation.—I do not assume
the liberty of advising industry;—Industry is far better acquainted,
than I am, with her own interest: it is to agriculture I presume to give
advice; and this I have an incontestable right to do, since I myself
am a cultivator, an _American_ cultivator, and that my fortune cannot
increase, nor even stand as it is, but with that of my brethren, the
cultivators throughout all _Europe_, whose consumption is as essential
to me, in regard to sugars, cottons, coffee, indigo, &c. as mine is
essential to them, with respect to wines, flour, oils, hemp, iron, &c.
How is it possible to charge them with an advanced price on the goods
they purchase, without diminishing their means of buying, _unless they
raise their own commodities equally with the above goods_?—How can one
diminish their power of buying, without diminishing also my resources
for a sale?—How can one diminish my resources for a sale, without
diminishing my means of production?—And how is it possible to put a stop
to the productions of _America_, without crushing in the very bud all the
_European_ productions, _which are to pay for them_?—There is not the
least doubt, but that, between merchant and merchant, alien or native,
there never is any difficulty: nothing more candid than their respective
conduct; never a word about prices; each fixes his own, and it often
happens that a bale of goods has been sold ten times upon the invoice,
and never opened:—But when a merchant, no matter of what nation, says to
his customer, no matter of what country; _English goods have increased
in price from 20 to 22, I cannot have them for less_; it is essential
for every land proprietor, from Pole to Pole, to know that he must not
hesitate to answer: _You cannot come down to me, give me leave to get up
to you_; or, in other words, _I also advance my prices from 20 to 22,
so that every thing is in its due order, and the cock of the balance
stands still in its place_. On this principle, clearly evident and of an
irrefragable necessity, I maintain that it is _England_, successively
compelled, as well by her wealth, as by her taxes and monopoly, to
increase her prices at home,—_England_, trading to all parts of _Europe_,
more largely than any other country,—it is _England_, I say, who, to
this day, has raised the prices of every thing all over _Europe_; and I
insist, that _England_, once more obliged to carry those prices still
higher, once more will compel _Europe_ to follow her example, and that
all _Europe_ will grow richer by her means, (as has been the case
hitherto) on account of the encouragement which this increase will give
in all countries, where _England_ may think fit to continue or extend her
trade on fair and equitable principles.
It is certain, that one cannot, without some reflexion, comprehend that
chain composed of so many incoherent, so widely distant links, that
union, that mutual dependance of interests, in appearance so opposite
to each other; and that, even with the assistance of a few _hypotheses_
sufficient to give an idea of the whole, the only confession subscribed
to by the reader, will be, that they imply no palpable contradiction,
but that they are nevertheless the mere offspring of imagination, and
ought to be ranked amongst non-entities. Yet the two _hypotheses_ of
which _Rome_ seemed to be the subject, were no more, if we except the
paper-currency, than the type of the revolution which took place in
_France_ at the time of the regulation I have spoken of,—a regulation,
which in less than two years increased the wealth of that nation from 16
to 24, 50 _per cent._; as if the _French_ had been at last made sensible,
that _England_ could not work for herself without working for them, and
that consequently they had a right to say with my _Roman_: _~England~
is rich to the amount of 24, only because she denominates 24 that same
quantity of wheat which our barricadoes and barriers have obliged us to
call only 16 in our country; the only thing to be done therefore, is to
set fire to our barricadoes, and break down our barriers, that henceforth
the same 16 may be denominated 24, and all at once we shall be in fact as
rich as ~England~, without having been so judiciously at work._
Another advantage that would accrue from that uniformity, nearly general,
in all prices, if one would lend an helping hand to Nature, after having
been convinced of the impossibility of reaping any other benefit from
the obstacles thrown in her way, but the sad advantage of retarding her
progress;—another advantage, I say, that would accrue from that kind
of uniformity in prices, which undergoes no alteration, but from the
wants and demands, is, that all that monstrous system of prohibitions
or equivalent restrictions, must crumble of itself: for, with what face
could a national manufacturer solicit the means and privilege of making
his own countrymen pay 10 _per cent._ dearer for those goods, which
another nation tenders to them at 10 _per cent._ cheaper, notwithstanding
the expence of exportation? What reasons could he urge when, instead of
answering, a cultivator should rise in the national council, and ask,
for the exportation of corn, an absurd premium which would instantly
enhance its price 25 _per cent._?—But the game of imports and exports to
which this last observation alludes, requires to be treated in a separate
article which it is not yet time to enter upon; all we have now to do
is to think on the means of giving a free circulation to the revenue of
all _Europe_, supposed to be increased in the proportion of 20 to 22, on
account of the same increase necessary in _England_ to pay three millions
interest, without any one being the poorer for it. I shall say nothing of
the facility of paper-currency, when the inutility of a national robbery
shall be once generally acknowledged.
Nineteenthly and lastly, If we are frightened by the necessity of a
balance in money, every where more considerable, in order to circulate
every where, a revenue increased from 20 to 22, to face the indispensable
rise in the prices of _England_, who trades to all parts of the globe;
(when we consider besides, that _France_ and _England_ are by the same
reason obliged to add to their respective balance already so loaded,)
it appears to me, that, after a retrospective view of what has passed,
one may readily be convinced, that whenever money becomes necessary for
circulation, wherever nothing more is required to circulate and balance
objects really existing, and equal to each other, there are always
people enough ready to carry money thither; and that this operation, _as
all those that are beneficial to society_, is generally effected when
it is neither counteracted nor encouraged, _without any one perceiving
it_.—Nevertheless it must be confessed, that the pretentions set up by
_France_, in regard to a balance, are as terrible, as formidable, as
those of _England_, due regard being paid to the difference between the
exports of both; I shall examine these pretensions as I have done those
of _England_, and bring them besides closer to each other, that they may
be more properly estimated.
_The pretended Balance of ~France~ in point of Trade._
The Work of Mr. _Necker_ on the _French_ finances, is in my judgement,
for that nation, the most precious work that this age has produced;
it is a sword hanging over the head of whoever shall fill up that
department during the reign of the present King, and of all those of his
successors whom God shall bless with a soul like his. That work would
still be precious, though it should serve only to expose the knavery or
the incapacity of those who pretended that _France_, preparing for a
war which required the creation of a navy, without which she could not
carry it on, forced to have recourse to new loans proportionate to such
an undertaking, and weighed down, as it was said, by the load of the old
taxes imposed for discharging the interest of her former debts, was again
on the eve of laying new imposts, in spite of herself, and perhaps of
having recourse to those degrading reductions, so lightly, yet so often
practised before. The first public operation of Mr. _Necker_ (his _Compte
rendu_) inspired every one with the enthusiastic spirit of an unbounded
confidence, wherever nothing was foreseen but the discouragement arising
from discredit. He did not create anything, it is true; but he dispelled
the clouds which had hitherto concealed what really existed; he restored
order where confusion reigned before, and treated the mechanical part
of the finances, like a merchant willing at all times to have it in
his power to compare his undertakings with his means, his plans with
his resources. No other step could be taken at first. I have no kind
of connexion with Mr. _Necker_, neither direct nor indirect; nor am I
bound to him by the ties of friendship, interest, or gratitude; and,
besides, it is not my intention either to praise, or to censure; yet I
cannot forbear to observe, that Mr. _Necker_, entirely circumscribed by
the circumstances of the time, charged with the triple load of clearing
up what was passed, supplying present wants, and guarding against future
events, could only loosely survey, regret, and prepare, what a situation
so critical did not permit him to undertake. His being displaced, left
him no other advantage than that of informing the public of what he
intended to do; and the manner in which the nation has received the
work wherein he recorded his projects, is at the same time a tribute
of the national esteem for the man who planned them, and a pledge of
the national gratitude, even for any one of his successors, who should
confine himself to carry them into execution.
Whatever I have hitherto said, whatever may drop from my pen in the
sequel, in contradiction to some of Mr. _Necker_’s opinions, was written
long before the publication of his work, and in no degree detracts from
the solidity of his views. What he devised was perhaps the best that
could possibly be imagined in the actual state of things, and according
to the received system:—But is that system the best?—I subscribe to
his principle concerning the precautions to be taken, and the slowness
of the march necessary even through all the paths that may lead to _the
best_; but that best, what is it? _France_ cannot boast of having found
it—read the work of Mr. _Necker_; _England_ cannot boast of having found
it—read the debates of both Houses of Parliament:—And do I dare to offer
my thoughts!—Yes:—two children, it is said, found what it was necessary
to find, in order to the discovery of immense bodies of light, at a
distance where nothing was suspected but the limits of creation.—Were my
thoughts only plausible, they ought to be thoroughly investigated; they
concern the State, they concern mankind at large:—if they prove just, to
say that they are impracticable on account of the shackles with which
our forefathers have loaded us, is to say nothing but with regard to the
fleeting moment in which I speak, _already so far off from us_; but to
feel then that we should not add new shackles to those we endure already,
would be a great point gained; to scrutinise afterwards the ancient
opinions, without exception; to analyse the principles on which pretended
impossibilities are founded; to expect nothing from seduction or from
authority; to desire nothing but from general conviction; to spare no
pains to make the people sensible of, and familiar with the truths that
might be discovered, would perhaps be a second step towards that very
mark to which we should probably direct our course, were it not for the
pretended impossibility, the mere supposition of which casts a ridicule
upon the very thought of looking up to it.
It is upon this plan, and under this point of view, that I purpose to
examine the supposed balance of _France_, in regard to trade:—and I
begin by asking, whether there exists a nation in _Europe_, which, upon
perusing what Mr. _Necker_ says to the present purpose, and the use made
almost generally in _England_ of the work of Sir _Charles Whitworth_,
much more explicit with regard to the balance of _Great Britain_, would
hesitate an instant to break off all commercial connexions with _England_
and _France_, if only one half should prove real in the prejudices of the
two nations, on the object, which at present seems to determine all the
others?
I would, in the next place, propose, for examination, whether those two
nations are not indebted to these prejudices, for the greatest part of
their mistakes, and of the obstacles which they have found, which they
still find, and which they will ever find, in the measures that other
nations think themselves obliged to adopt, in order to guard against
the effects of those prejudices, till their fallacy is universally
acknowledged, as well as their insufficiency to produce their boasted
effect, _even in favour of those who would obstinately refuse to give
them up_.
Every year, say the prejudices of both nations, more than seven millions
sterling are required for their two _terrible_ balances;—but not above
six millions are brought over from _America_:—if _Spain_ and _Portugal_
be allowed to come in for one sixth (indeed it would be but just), the
other parts of _Europe_ must settle it amongst themselves to find the two
millions sterling, which without that assessment would be deficient in
the balances necessary to _France_ and _England_.—Whence does _Europe_
take those two millions? Whence have they been taken hitherto? I know
not: but it is a stubborn fact: you may consult the work of Mr. _Necker_
for the balance of _France_, and for that of _England_ the statements of
Sir _Charles Whitworth_; the former amounts annually to 70 millions of
_livres_, about 3 millions sterling; and the latter to 83,678,818_l._
in the space of 20 years, from 1754 to 1773; it is, one year with
another, more than 4,180,000_l._ _per annum_. But above all, let it not
escape your observation, what is said in _France_, that the decline of
that Empire will begin, when this balance of 70 millions of _livres_
shall begin to decline, and that it is the opinion in _England_, that,
were the _favourable balance_ to be below 2 or 3 millions sterling, a
national bankruptcy must indispensably follow. What is most _miraculous_
(and indeed consolatory for those who are obliged to think of their
elevation, before they dream of a bankruptcy, or even of their decline)
is, that whilst _France_ and _England_ have received annually, the one
4, the other 3 millions sterling, that is to say, one sixth more than
_America_ has to share amongst all the _European_ nations, the other
countries in _Europe_ have nevertheless increased their mass of money, by
all that was necessary to keep up their luxury, and the circulation of a
revenue which has almost doubled in the course of a century. These are
prodigies which will cease to be so, even if we admit the facts on which
they are founded, if we take the trouble of adding thereto a few other
facts rather less questionable; and if it be acknowledged at last, that
there are yet others, concerning which the most expert calculator cannot
flatter himself that he shall even come near the truth, and which give
to those who will be at the trouble of reflecting, all the latitude they
may want, to conclude that the two supposed balances are as inadmissible
when subjected to the discussion of reason alone, as they are afterwards
demonstrated to be false, by facts which cannot be controverted.
The quantity of money required for circulation, depends neither on
the speculations of a Minister of finances, nor on the blind cupidity
of trade, which, luckily, is always counteracted by the clear-sighted
cupidity of every trader: it depends on the quantity of articles to be
circulated, on their price, and on the method adopted for circulation:—it
is evident that less cash is required in _England_ than in _France_
to circulate the same mass of revenue, trade, and transactions of all
kinds; the reasons are obvious: but the sum wanted for the circulation
being once found, every addition thereto is soon, notwithstanding all
ministerial machinations, transferred to some hundred leagues distance,
if that surplus should be wanted there: now, when this necessary sum
for circulation is once ascertained, we shall see how useless it is to
despoil, how absurd it is to suppose that they do despoil the rest of
_Europe_ of her money, in order to keep up that circulation.
What is the real amount of the cash circulating in _England_? Some say
25, others 30 millions sterling. It is probable that 25 millions are
sufficient, with the help of credit and paper-currency, even in the
supposition that _France_ should stand in want of 2 _milliards_ of
_livres_ in hard cash to give circulation to a revenue, double to that
of _England_, because there is in _France_ no paper-money, and much less
credit than would be obtained, were it not, _too often yet_, so easy to
avoid, by another kind of credit, the payment of the most lawful debts:
but we must argue from an incontrovertible fact, and assent, in their
fullest scope, to the consequences that may be deduced therefrom. The
following is the fact:
Of all the coin circulating in _England_, 18 months ago there was only
a sixth, and there is now much less than a sixth part, in pieces struck
before the present reign. Now, in 1780, it appears that the money coined
at the Mint, in the present reign, amounted only to 30,457,805_l._
It is impossible to suppose, that in the space of 18 years there should
have been carried out of the kingdom, either to _Ireland_, or in support
of the smuggling trade, or for other purposes, less than the amount
of the coin struck since that period. Let us add to the 30 millions
coined from the beginning of this reign down to the year 1780, the
5 millions for the sixth part in old specie remaining of the former
reigns (that sixth supposed, rather than acknowledged, to be actually in
circulation), the total will be 35 millions; to which must be added, the
value of silver plate, toys, &c. Admit, that all these articles together,
circulation and silver wrought, amount to 50 millions sterling;—to those
who may think that the sum of 15 millions, at which I rate the wrought
silver of all kinds, is too trifling, I would recommend to observe,
first, that these 15 millions constitute nearly the tenth part of the
general revenue, both of the land and industry; secondly, that the third
part of that revenue belongs to the peasants and mechanics, who have no
such costly furniture; and thirdly, that as to the rest of the nation, if
there exist a man who possesses the equivalent of one half of his revenue
in plate, there are scores who are not possessed of so much as one tenth
part.—Shall it be insisted upon, however, that, by adding the amount of
plate and the mass in circulation to that which _must_ correspond with
the demands that may be made upon the Bank, the whole amounts to 60
millions sterling?—Be it so;—but _England_ was certainly in possession
of 20 millions at least, in cash and wrought silver, before the time at
which Sir _Charles Whitworth_ began his Statements; for there existed
then much less credit, and no paper to answer the purposes of cash:—forty
millions, then, constitute the whole of what _England_ chose (I call it
strictly a choice) to reserve, out of so many millions imported from
_America_, which really went through her hands, in the space of 90
years.—I am fully persuaded that I could meet with some thousands of
persons, even in _England_, who, from the sketch I have given, would
think that I make a present to _England_ of 10 millions. It matters not,
I shall be equally generous in regard to _France_, whose accounts I am
about to lay open; and yet I shall have gold and silver enough left to
extend my liberality all over _Europe_.
Mr. _Necker_ has but two reasons to suppose that there exists in the
_French_ circulation a sum of 2,200,000,000 livres _tournois_. The first
is the indubitable fact, that since, and including the general re-coining
of the _French_ specie in 1726 to 1783, there have been struck, in the
different mints of that kingdom, 2,500,000,000 of the same specie (the
only one that is current in that country:) and, in the next place, the
very questionable fact, that _France_ has preserved the whole, except 3
or 400 millions _tournois_, which may have passed into foreign hands,
from the quantity of _French_ specie which must have been carried abroad,
to answer her commercial and political purposes.
Say only 2000 millions of livres in the _French_ circulation, that I
may not be troubled with 100 millions, which can neither weaken nor
strengthen my reasonings.
When that general re-coinage of the year 1726 took place in _France_,
there must have existed, at that time, 1000 millions _tournois_, to
impart a proper circulation to a revenue, which, we may suppose, was
less by one half than what it is at this time. _France_, therefore, had
occasion to increase her specie, only by the additional thousand of
millions, of which she is now in possession, even upon a supposition that
she has now 2000 millions; and this want has been supplied in the space
of 57 years, at the rate of 18 millions only, one year with another.
Let it be granted, now, that the annual wants, the personal wants of
_France_, in articles of luxury, plate, gold and silver lace, trinkets,
&c. amounted to 7 millions _tournois_, upon an average, in the course
of the above 57 years.—By adding thereto the 18 millions I have spoken
of, I can find but 25 millions overplus, one year with another, saved by
_France_ upon all the treasures of _America_, which certainly must have
passed through her hands from 1726 to 1783.
The reader must be sensible, that there is no occasion to speak of the
sums annually exported to _India_, it matters not by whom; they no longer
exist for _Europe_; and I have proved nothing hitherto, if it be still
doubted that _Europe_ has lost nothing in that respect but the trifling
advance in her prices, which 100 or 150 thousand pounds sterling, added
annually to her general specie, would have given to all the productions,
both of agriculture and industry. The return of those 150,000_l._ in
_India_ goods has produced yearly to _Europe_ all the labour necessary
to repay them; for it must be observed, that _labour pays every thing_,
and that nothing is paid but by _labour_. The 150,000_l._ exported to
_India_, are not lost therefore, as to their essential effect, as would
be the case of sums laid up in the coffers of a Sovereign, who might be
unacquainted, even at this day, with what was known to Queen _Elizabeth_
above 200 years ago, that _the Prince’s treasures are well placed no
where, but in the hands of his subjects_, that is, of _such_ amongst his
subjects _who do not lock them up in their own chests_.
I join together the two balances of _France_ and _England_, which
probably fall much below, and which cannot be above, what I have stated
them to be; and I see that those two formidable bugbears, after having
annually devoured, according to their own account, 7 millions sterling,
have, in the end, and very fortunately too, only digested something less
than 2 millions, viz. the bugbear of _France_, 12 or 1300 thousand pounds
sterling; and the bugbear of _England_, about 5, 6, or 700 thousand.
Thank Heaven then, there remains, after _England_ and _France_ have been
fully saturated, (including the general exportation to _India_) about
4 millions sterling, which the other States of _Europe_ have received,
one year with another, partly in plate, partly in gold and silver-lace,
partly in ingots, partly in guineas, and partly in louis-d’ors, of which
those who gave them still think themselves in possession, and which those
who received them do not think they possess.
But, it will be said, the louis d’ors, which are spent in _Germany_
during a war, revert to _France_ soon after a peace; the plenty in
which they flow back, is known to every one who has the least concern
in trade.—No doubt of it; when the _German_ circulation is overloaded,
it must re-flow where it is beneath its level: the coin carried by the
_French_ into _Germany_, in the time of war, was then indispensable there
to supply the wants of those who carried the money into that country,
and to increase the means of the ordinary circulation, _an increase
occasioned by a circumstance that tertiated the price of every thing_.
The circumstance subsiding, every thing takes its usual course; prices
are reduced; the greatest part of the money which had been carried there,
becomes useless on account of that reduction:—it is sent back; and why is
it taken then by _France_? Because it is become necessary there;—for you
must observe, that the money in question was useless in _France_, as soon
as it was wanted in _Germany_.—During the war the commerce of _France_
was at a stand; her granaries overstocked with corn, her cellars with
wine, her warehouses with goods, waited only for peace, to set a value
on that corn, that wine, those goods, and of course, on that idol Money,
which, during the war, could not, in regard to the _French_, be of any
value, but on the very spot where the _French_ had themselves carried it.
Observe, above all, that _England_, who pretends to have the largest
balance in money, is the very nation who, with respect to the
extensiveness of her commerce and the mass of her industry, keeps the
least part of that balance at home, and constantly preserves as little
of it, as if she had been no less convinced than I am myself, of the
futility of any other balance in bullion, but that which is necessary for
the five articles above mentioned. What results now from the reduction of
those two frightful _colossi_ to their proper dimensions?
It results, First, that every system of balance, founded on the
supposition which served as a basis to the two balances I have spoken
of, is as chimerical, as it would be pernicious to the nation who should
regulate herself by it, and to such other nations as might be unfortunate
enough to correspond with her:
Secondly, That the private interest of every merchant always militates,
in this respect, against the pernicious dreams of trade in general:
Thirdly, That the case between nation and nation trading together, is
similar to that which subsists between citizen and citizen; as there is
but one way for a man to prevent the last penny of his wealth from being
useful to some other member of his community; and that way is, _to bury
under ground (as soon as he has received it) that last penny, the utility
of which he grudges to share with other men_: in like manner, a nation
can no otherwise prevent the surplus of her money being carried into
another country when this latter is in want of it, than _by burying her
balance as soon as she has received it_:
Fourthly, That the superiority of industry, activity, and _capitals_,
in a nation, gives her no other advantage, than that of supplying those
countries with which she trades, with further means of increasing their
own industry and activity: Now,
Fifthly, The more you increase industry and activity amongst other
nations, the more you increase their want of those signs which are to
represent the products; the more you increase their want of those signs
which you long to possess exclusively, if it were possible: Therefore,
Sixthly, If it be true, that money ought to be the only aim of commerce
and exportation, all the favourite ideas on the pretended balance,
being entirely destroyed by facts, even at the time when the world was
more fully persuaded of the truth of those ideas, and of the wisdom of
the measures which were to have perpetuated that balance, it would be
necessary henceforth to resolve to hide money under ground, as fast as
it comes in.—Would it not be better to question the principle itself,
and seek for fresh information on the utility as well as the object of
exportation?
_Exportations and Importations considered as a Game. Such a Game is as
rational as any other, to whosoever will not content himself with playing
at Cards, or with his own ~Thoughts~._
A world of unanswerable arguments start up at once, tending to
demonstrate the superiority of civilization over the wild state of
nature. Yet, methinks, a savage may overturn them all by these few
words: _I know nothing of what you say, and I am not inquisitive_.—I
readily confess at least, that I do not see what reply can be made to
such an answer, more than I did with regard to the four questions put
in the Upper House to the manufacturer of whom I have spoken; yet this
manufacturer was not stronger in argument on all that was foreign to the
essential point of the four questions, than I might be to convince my
savage of that delight, which a man fully persuaded of the excellence of
his own conceits, and of the happiness there is in making them known to
all the world, feels, without allay, without interruption, in staining
some reams of paper, scribbling sometimes an hypothesis, sometimes a
comedy, a romance, a ballad, &c.; for it is very true, that the work I
now lay before the public, has, in the space of 12 or 15 years, undergone
all those metamorphoses in my hands, and that during that time my heart
rankled with the ambition of being read in antichambers, given for
premiums in colleges, tolerated in nunneries, mentioned in the _boudoirs_
of the fair, noticed in the memory of Ministers, revolved in the hearts
of Sovereigns, and every day sung about the streets and in cottages,
through which all princes must sometimes pass, if they wish to discover
some decisive difference between the interesting illusions of humanity
and the deep speculations of politics. Yet with all that stock of words,
if not of reasons, that I must have acquired beforehand, to justify, in
some measure, the extravagance of such an ambition, I own that I should
be confounded by the answer of my savage.—But this could not be the
case, if a civilised man, after having convinced me, that the advantage
of commerce between man and man, as well as between nation and nation,
consists in supplying each other’s wants, when it is possible to effect
it by an exchange of surplusses, would next undertake to prove to me,
that the advantage of a State, which is nothing else but a nation, an
aggregation of men, consists in keeping as much as possible of that
money which they have in too great abundance, though the inevitable
consequence would be, that they would procure to themselves so much less
of some article in which they might be deficient, but which it would at
the same time be very convenient to them to possess.—It is hard that the
compendium of prohibitions, restrictions, &c. so much commended, and
which have kept so many great men so long on the watch, dwindles finally
into the assertion of the two contradictory propositions which I have
just now dated.
Two articles are necessary and sufficient to man—bread and water; let not
meat be called in as a third; it is too well known, that three fourths
of _Europe_ seldom eat any, and doubtless no one will contend that
three fourths of a whole are less valuable than the fourth remaining,
in the eyes of Him who created that whole, and who probably takes some
concern in its preservation. Exchanges of any other articles besides
bread and water, are therefore, strictly speaking, _exchanges of mere
superfluities_. Now, what inconvenience can there be in bartering one
superfluity against another?
I shall first of all, display in their full force, the most solid
reasonings that can possibly be adduced, in order to demonstrate, that
_the choice and price of all superfluities must be left to the discretion
of one set of men only_. The chymist is not to blame if he can extract
nothing but a fetid oil from the matter which he undertakes to decompound.
That set of men, as estimable, as worthy as any in the world, will
perhaps wonder when they see the analysis of those ideas, which,
probably, they never submitted but to a superficial examination.
_Prohibitory Laws against Exportation._
_Query._ Why do you solicit a prohibitory law against the exporting of
such an article of national product?
_Answer._ That I may get it _cheaper_.
_Q._ Can you buy it _cheaper_, without wronging the man who might sell it
_dearer_?
_A._ No.
_Q._ As it is impossible to prove that such a conduct is equitable, how
will you be able to prove it to be advantageous to the State?
_A._ It is advantageous to the State, that all its internal productions
should receive at home, all such forms and preparations as may increase
their value.
_Q._ Is the quantity of productions useful to the State?
_A._ The question is almost ridiculous.
_Q._ If the _productor_ be discouraged by the low price set upon his
productions, and take proper measures to produce _less_, in order to save
the expence attending a _greater_ production, and in the mean time to
gain by producing _less_ as much as he could gain by producing _more_,
will you not then be guilty of having wronged the State of all the
productions which you crush in the very bud, by the prohibition you sue
for?
_A._ No; Smuggling will give to the parties injured by the prohibitory
law, a fully sufficient means of extricating themselves.
_Q._ Your hopes then are, that Smuggling will make up for the injuries
you propose to do to the _productors_; but how will you compensate to
the State for the loss it sustains by a clandestine exportation?
_A._ Our only business is to mind our own interest; besides, the State
may easily procure, by means of a land-tax, what it may lose by the
clandestine exportation: and we are so far from expecting that Smuggling
should turn out to our advantage, that we petition it may be made a
capital offence, and prohibited under pain of mutilation, the galleys, or
at least the entire ruin of the smuggler.
_Q._ But the law will either succeed, or fail in its effect. If the
law succeed, will you not be the author of that diminution of the
products, which the low price you intend to set upon those products
must unavoidably occasion? And if the law fail in its effect, do you
not uselessly deprive the State, 1st, of the produce of the smuggler’s
labour, whom you hope to see hanged, or at best, mutilated; and, 2dly,
of the produce of that labour which would have been performed by that
army, partly composed of rogues, partly of idle fellows, now to be
set upon the watch to detect and apprehend the smuggler, keep him in
close confinement, and lead him finally to the _gallows_, or to the
_galleys_?—Who is to pay those rogues and idle fellows?
_A._ The State, to be sure.
_Q._ What are the essential parts of the State?
_A._ Industry that goes in search of money, and Agriculture in as much as
she feeds Industry _at the cheapest rate_.
Agriculture, impoverished by your prohibitory law, will then lose, not
only what she should get by being at liberty to export, but also what
she must find to assist you in procuring her impoverishment, by paying
the land-tax necessary to pay those very rogues and idle fellows, whose
business it is to destroy her only remaining resource against your
cupidity—SMUGGLING.
_Prohibitory Laws against, or excessive Duties imposed upon Importation._
_Q._ Why do you petition against the liberty of importing such or such
another article?
_A._ Because we manufacture it, and wish to sell it dearer to the
national consumers.
_Q._ Of how many orders of men is the class of national consumers
composed?
_A._ Of two, the land proprietor, and all persons not wholly destitute of
money.
_Q._ That is to say, _in all cases_, of the whole kingdom, against the
small number of individuals who humbly petition for the prohibition of an
article;—be it so. Have you devised any means to increase in the consumer
the ability of purchasing, whilst you advance the price of your goods?
_A._ Not we;—on the contrary, it is our intention to have as much as we
can of his commodities and money, for as little of our goods as possible.
_Q._ How can men of probity and knowledge be blind to the iniquity of
such a scheme?—Will not at least its execution be somewhat impeded by the
greatest part of those who follow the same trade?
_A._ No—that is impossible: our _corporations_ have already provided
against the inconvenience you allude to: not one of their members would
dare to sell his merchandise below the price fixed by his _corporation_:
and we have made, as it were, the _impossibility_ of any such measure,
_doubly_ so, by the difficulties we have devised to prevent a ready
admittance into our _corporations_; all our bye-laws tend to reduce our
associates to the smallest number possible. But one single expedient
is now wanted to put the finishing hand to that grand work; it is the
absolute prohibition of importing all those commodities which foreign
nations might offer at a cheaper rate, than we are determined to sell
them at.
_Q._ So then, if you succeed in your plan—if by means of the solicited
prohibition, the legislature enable you to extort, with your 16 in
merchandise, the goods and money, which, in the case of a foreign
competition, you could not have procured with less than 20, what do you
intend to do with the remaining part of what you shall have extorted?
_A._ We shall send it abroad.
_Q._ With what view?
_A._ Of increasing the balance in money.
_Q._ Have you hitherto acted confidently with that idea?
_A._ We have—and it is known to all the world that it is the dearest idea
of an _Englishman_—an idea which the nation holds (if properly attended
to) as the only bulwark against a national bankruptcy.
_Q._ What have you got by that idea, if it be probable that there is not
above 25 or 30 millions in specie within the kingdom, and if it be proved
evidently that it is impossible you should have more than 35?
_A._ The reason is, no doubt, that foreign importation has been too
freely permitted; a criminal, a traiterous indulgence which we are
incessantly at work to remove: and it is on that account, that besides
the absolute prohibition we now pray for in regard to such and such
articles, we also petition that the duties be laid double and treble on
all other foreign articles which are not yet totally prohibited.
_Q._ Do you not fear that foreigners, whose merchandise you would cause
to be prohibited, should play the same trick with yours? Do you not fear
that those on whose goods you mean to increase the duties, should in
their turn overload those which they will receive from you?—For this is
all the conjuration requisite to counteract and balance the effect of
those sublime regulations which you petition for.
_A._ We shall carry on a smuggling trade in their country, and they will
pay dearer for our goods; they cannot do without them.
_Q._ They will, no doubt, follow your example: therefore new recruits
will be wanted for that army of rogues and idlers, designed to lay hold
of, and ruin whoever should dare to oppose your ransoming the owners of
lands, and proprietors of some money; but be it so:—you will besides be
equally successful in obliging the poor ransomed individuals, to pay
for the additional and necessary reinforcement of your standing army of
rogues and idlers, and for those light troops of informers so well fitted
for the noble purpose you are carrying on;—be it so again.—But, after
all, what are you to do with that immense balance in money?—Shall you
bury it under ground?
_A._ Aye—and with all our hearts and souls, if, when thus buried, it
could bring to us the same benefit as when it is rendered useful to
some one else; but alas! that secret is not yet found out: it might be
possible, however, to pray for an Act of Parliament, compelling the
nation to pay the interest of all the sums thus interred by us; and the
wisdom of such an Act would be the more conspicuous, as it would keep
within the reach, under the very hand of the nation, all the money
she might have occasion for, whenever she should think it expedient
to declare war against _France, our natural enemy_. Till such an Act
is framed, we shall follow the example of _Holland_; we shall keep on
the carrying trade, by which the _Dutch_ have gained so much money
notwithstanding our Navigation Act, which we fondly hoped was calculated
to effect their ruin: we shall carry from _Russia_ to _Sicily_, from
_Constantinople_ to _Poland_, from _Stockholm_ to _Cadiz_, from _Lisbon_
to _Venice_, whatever may be carried from one place to the other, and
this we shall do at the lowest prices, in order to get the preference
of the _Dutch_. It is a great pity that this cannot be effected without
benefiting the land-owners, and the proprietors of some money, in all the
countries where we may stand in competition for that carrying trade, not
only with the _Dutch_, but with all the national monopolists who shall
not have as yet been dexterous enough to force from their legislature,
laws as _favourable to commerce_ as those we have obtained; but in fact,
what matters it to us whom we serve, provided we get a good profit from
the service?
_Q._ Will you add further: _And provided also that the service done,
falls not on the land-owner, or on the proprietor of some money within
your nation_?—Yet thus far would you finally be led by that system of
prohibitions and restrictions, almost equally extravagant, to which you
are so devoutly attached.—But such a plan can succeed only to a certain
degree: be pleased to observe, that hitherto you can boast of no other
advantage but that of the first attack.—Sole and absolute arbiters as you
are of your own prices by the monopoly you have obtained, if agriculture
had not advanced those of her products in the same proportion, would
not your land-owners be compelled to seek abroad for a country where
monopoly should not be so obligingly countenanced? For you do not,
I presume, flatter yourselves that you shall be able to induce your
Parliament, in the age we live in, doubly to tax the property of those
who might look abroad for a remedy against your extortions:—the many laws
of that kind consigned to your annals, (and which you would not fail to
quote as a precedent,) must seek in the ignorance and barbarity of the
age that gave them birth, an apology for their establishment; but at
this present time!—Such shades in the picture of the Land of Liberty,
instead of setting off the beauties of its other parts, would annihilate
the very idea of that liberty. _It is by justice and freedom that we
are attracted and retained; it is by injustice and restraint that we
are expelled, and kept at a distance._ Be pleased then, in fine, to
observe that nothing can result from those plans, the iniquity of which
you have no more searched into than you have thoroughly examined their
consequences,—from those prohibitions and restrictions, the effects of
which must be counterbalanced by contradictory regulations,—except the
pitiful advantage of having perverted the nature of the prices on every
article. _What is necessary to counteract the effect of an injury done to
the generality, will always mechanically be brought about by that very
generality._ Would it not be more advantageous for men, to agree amongst
themselves, like intelligent beings, on some plans accounted equitable by
all,—on plans the analysis of which the projector might bear without a
blush?—Were a few points agreed upon, it would not perhaps be difficult
to settle all the others.
Let the dead bodies be wrapped up in woollen instead of linen cloth;
linen coming from abroad, wool being a staple commodity, and the dead
caring little whether their winding-sheet be made of woollen or linen:
it is a point of economy which it would be rather too severe to condemn,
although it is probable enough that in the North they would exchange
with pleasure, for your _buried woollen_, linen cloth in sufficient
quantity to wrap up your dead; a circumstance which might prove very
beneficial to some of the living, both in _England_ and _Silesia_. But
will you attempt to persuade, that it is advantageous to the State,
under any aspect, to compel a man who calls himself free, to wear
manufactured buttons, when his inclination would lead him to have them
made of remnants of stuff? Will you attempt to persuade, that it is
advantageous to the State, to make him pay a penalty of 3 or 4 pounds,
besides cost, if he is surprised _flagrante delicto_? Will you attempt to
persuade, that it is advantageous to the State, to encourage the infamous
trade of informing, by a reward in favour of an informer, against a
man guilty of _such a crime_? Will you attempt to persuade, that it is
advantageous to the State, to withdraw from their useful occupations a
swarm of fellows, _become capable of any dirty work_, by having turned
informers on account of the stipulated recompense, and who, waiting for
an opportunity of doing worse, leave their work-shops as soon as such
a law is passed, in search of a prey the seisure of which will enable
them to live in riot and intoxication for a whole week together, without
being obliged to return to their work? This is not all; for, in fine, if
all the branches of industry have the same right to the protection of
Government, does not a law, the immediate effect of which is to enhance
the price of buttons by occasioning a greater demand for that article,
destroy all idea of that protection equally due to the other branches of
industry, by infallibly depriving some of them, both of the amount of the
cash they might have received from those who will now be forced, against
their inclination, to purchase manufactured buttons, and of the amount
of cash which the advanced price of manufactured buttons, will unjustly
wrest from those who, by the effect of the law, are obliged to pay dearer
for what they might have procured at a cheaper rate? Would not the
least facility granted for the importation of some foreign merchandise,
have occasioned abroad a greater consumption, either of buttons, or
of some other _English_ goods, than such a law can procure at home in
the manufactory unjustly favoured? But, above all, will you attempt to
persuade, that it is advantageous for the State, to acquire a thousand
more button-makers, when that acquisition is obtained by the loss of a
thousand artificers employed in manufacturing some other articles, the
consumption of which would have been _free_, that is, analogous to the
situation of those who boast of their being so?
Let us seek for such points, as it may be possible to agree upon.
The State is composed of three orders of men, all equally precious, and
whose rights are equally sacred; _viz._ the landed _capitalist_, the
_capitalist_ of industry, and the proprietor of money, whether he be
considered as a _capitalist_ in this last respect, or only as a dependent
on either of the two former _capitalists_. Each of these three orders has
its interest.
First, It is the highest interest of the landed _capitalist_, that there
be the greatest plenty and variety of the best products of industry, and
the greatest consumption of the productions of the earth.
Secondly, It is the highest interest of the _capitalist_ of industry,
that there be the greatest plenty and variety of the best productions of
the earth, and the greatest consumption of the products of industry.
Thirdly, It is the highest interest of the money proprietor, that there
be the largest quantity and variety of the best products both of industry
and agriculture, in order that he may be able to support the value
of his capital by the quantity of objects on which he will have it in
his power to lay it out, and the value of his interest by the greatest
possible consumption, not at the lowest price, which, supposed lasting,
is as chimerical as the pretended balance, _constantly favourable_, but
at the most equitable rate, that is to say, the highest the seller can
hope for, and the lowest to which the purchaser can pretend.
But if it be true, that the combined interest of the three orders be
centered within the three points I have stated, namely, the greatest
possible quantity and variety of the best productions of the earth,
the greatest quantity and variety of the best products of industry,
and the greatest as well as most unconfined consumption of both at an
equitable price; it is equally true, that it must be a matter of perfect
indifference to agriculture, in what part of the world, and by whom her
productions are consumed, provided they be paid to her in any products
whatever, at her option equivalent to those she has parted with. It is no
less true, that it is a matter of perfect indifference to industry, in
what part of the world, and by whom, her products are consumed, provided
she be paid for them in any products whatever, at her option, equivalent
to those she gives. It is equally true, that the money-proprietor must
view, with the same indifference, his property giving life to this or
that branch of industry or agriculture, provided, that in the hour
of need or fancy, he finds at hand, on the most equitable terms, the
greatest quantity and variety of the best products of agriculture and
industry, which the interest of his money, or the amount of the salaries
he enjoys, gives him A RIGHT to expect.
There remains, it is true, a fourth interest, that of the _Fisc_, or
public revenue; but if this revenue be nothing more than the produce of
the taxes, this fourth interest consists of course, as the three former,
in the largest quantity of products, and the greatest consumption. Now
are there any other means to obtain those two objects, besides the freest
and most extensive exchange, not of goods for money, but of goods for
goods? Is it not perceivable, that all the four interests united, as well
as each of them separately, require that no more be imported in bullion
or money than the quantity necessary to facilitate those exchanges?
Is not a surplus of money not only useless, but even detrimental, in
diminishing our enjoyments, our possible profits, and _that consumption
which produces the public revenue_?
The Navigation Act was, if you will have it so, the last effort of the
human mind, at a time when every notion relative to commerce, was nearly
confined to _England_ alone; but I question much whether the _Opposition_
the most warm in invoking that tutelary God, against the Minister who
dares to offer the least encroachment upon its worship, would not be
very much pleased to see it destroyed before they themselves should come
into office: it is an old idol, to which incense is offered through mere
policy, and for which a veneration is kept up in the minds of the people,
for the sole purpose of making it subservient to the downfall of the
man who might be courageous enough to attempt its destruction. I shall
pass over in silence the obstacles which that famous Act daily opposes
to regulations as well adapted to the present state of things, as those
it contains were to the circumstances that gave it birth; but, to the
intoxication produced by its success, I shall be bold enough to impute
one of the most mistaken notions on the true aim of national commerce:
it is a very fatal error, to imagine that money ought to be the _object_
of those operations of which it is only the _means_. This chimera, it
is true, has never been realised; the wisdom of private cupidities has
always triumphed over the folly of general cupidity: nothing more clear
than the exactness with which the treasures of _America_ have been
shared amongst all the nations of _Europe_, each in proportion to her
agriculture and her industry, that is, according to her wants: at least
it appears to me, that the two balances of _England_ and _France_, which
I have produced, are incontrovertible proofs of what I here advance,
though they have been imagined and received as proofs of the very
contrary; nevertheless, the prejudice concerning these two _formidable
balances_ still subsists, and it is this prejudice which daily gives
life to new prohibitions, and new restrictions: there is not perhaps in
all _Europe_, a single modern regulation of that kind which does not owe
its establishment to this prejudice, and to the power it derives from
the veneration paid to it in the place where it was first conceived. The
nation who takes the lead in point of commercial knowledge, is every
where carefully watched. On the least of her operations, other nations
make use of the light she has held forth; her principles are studied,
her maxims adopted, her examples followed; every where they are on their
guard against her pretensions, pretensions openly avowed, prosecuted
without mystery, and crowned, as it is supposed, with success; and when
they see, that within the course of a twelvemonth, she has really
received more gold and silver than she was wont to receive in three
years; when they see the intoxication of her inhabitants on the arrival
of those treasures which obey her call from all parts of _Europe_;
when they hear the complaints of her news-paper writers against the
untractableness of the _Americans_, in not suffering themselves to be
entirely stripped of their specie; when they attend to her invectives
on the combinations of the _American_ merchants to prevent those of
_England_ from taking away that trifling sum in specie which the _United
States_ want, to give more consistency to their paper-money;—_then_,
indeed, _then_ it is possible to forget every thing else; it is possible
not to remark, that, with the same excess of avowed cupidity, _England_,
nevertheless, has not received, in the course of a whole century, (_a
period sufficient to determine an experiment_) _England_, I say, during
a whole century, has disdained to receive her dividend of the treasures
imported into _Europe_; the paper-money circulating in _England_ stands
evidently in lieu of a great part of the sum it represents, _and which
it was at her own option to procure_. It is also very pardonable not to
reflect _then_, that it is impossible for _England_ to keep long in her
hands without hurting herself, more than any other nation, any money
above what is necessary for her. No one takes the trouble of arguing long
on causes, when the effect is instantaneously and powerfully felt: _Not
~Europe~ alone, but the ~United States~ of ~America~, are stript of their
money by ~England~; ~England~ therefore wants not any longer to import
foreign goods, or when she advances the price of her own merchandise, she
refuses paying dearer for that of other nations._ The other nations do
not hesitate—_English_ goods are instantly prohibited.
The following principles are such as, I think, can never mislead.
There is not a single nation that cannot boast some palpable advantage
over another; nay, there is not a nation, a single province, that has
not received some peculiar favour from nature, which the same soil to
all appearance, the same temperature, the same exposure, refuse to yield
any where else but _with double the labour, and double the expence_,
and which, even with such additional aids, they yield at last only in a
state of degradation. Now, that portion of such peculiar favours, which
the proprietor of the land does not chuse to consume, belongs only to
the greatest quantity of other favours that it is possible to procure
in exchange. The more the proprietor procures of such other favours in
exchange, the more is he encouraged to increase the quantity of articles
which have enabled him to procure those favours; on the contrary, the
more he is restrained with regard to those exchanges which he might
procure, the more he is circumscribed, even in his means of production.
Every restriction therefore tending to diminish either the production
or the price of any article whatever, is a theft committed upon the
proprietor of the land, upon the province blessed with that favour which
is peculiar to it, upon the nation whose general revenue is decreased by
the whole amount of the productions stifled in the very bud, upon the
exchequer of that nation which would receive a duty on those productions;
and finally upon every one capable of presenting the nation with another
exchangeable commodity, or waiting only to see those productions, in
order to create an equivalent to pay for them.—Does it signify in what
part of the world? Must it not, at last, reach the original proprietor,
if he be not paid?
What is said of the productions of agriculture, may be applied to those
of industry. It is a gross mistake to imagine, that all things can be
equally well manufactured every where: how many fabrics, the perfection
of which depends on the quality of the water, and other local causes for
which it is impossible to account! How many more derive their perfection
from the bent of national genius, from the general dispositions, the
natural qualities of the inhabitants! Can we expect from the vivacity
of the _Frenchman_, who desires only to consume, what we may expect
from the patience of the _Englishman_, who labours only to enjoy? This
latter will always, and in spite of himself, give to his work a solidity
which will increase its price as well as its value; the other, in spite
of himself, will be busy about the forms best calculated to procure a
quick sale: objects of real comfort will always belong to the former, the
latter will ever lead the fashions. To hope that the one will produce,
without difficulty, what costs little or nothing to the other, would be
attempting to give to the wines of hot countries the pleasing acidity
proper to the wines of _Germany_; to these, the restorative and balsamic
qualities of the _Spanish_ and _Italian_ wines in the places where they
understand how to make them; to the wines of _Italy_ and _Germany_, that
native generosity proper to the wine of _Bordeaux_; to all of them,
the flavour of _Burgundy_ and the sprightliness of _Champaign_. It is
possible, say they, to imitate every thing;—say rather, to adulterate, to
corrupt, nay even to poison every thing, if Art can find no other way to
counterfeit Nature: _and these are the blessed effects of restrictions
and prohibitions_. It is a strange idea, to think of doing without
others; as if that did not lead them to think of doing without us; as if
the savage, of whom I have spoken, had not the same reason to prefer his
state to that of civilisation.
Nor would it be less strange to persist in setting the interest of the
people in opposition to that of the Exchequer, if it were possible to
reconcile them together, _instead of rendering, almost on every object at
present, the infamous trade of informers more lucrative than labour_.
Smuggling is hurtful to the State; it deprives government of the duties
on the articles smuggled into or out of the kingdom; but is it so very
advantageous to succeed in the measures adopted to prevent it, if by
bartering a great number of honest smugglers against a great number of
informers and a great number of custom-house imps, you make so many
thieves of the first, so many much more contemptible wretches of the
second, a rabble almost equally vile as the third; and succeed, at the
same time, in debasing in the hands of several manufacturers and landed
proprietors, the value of all those articles, which were before taken
from them by the smugglers to their mutual benefit?
_England_, it is true, suffered no damage, when a prodigious quantity
of _English_ goods, which are not comprehended in the _modest_ balance
with _France_, as stated by Sir _Charles Whitworth_, because they were
introduced into _France_ by smugglers, were sold nevertheless, without
much ado, all over that kingdom, and particularly in _Paris_, publicly
advertised on the shop-boards, in large gold letters;—but had not
_France_ some reason to think herself ill used, when an equal quantity of
_French_ goods, introduced also by smugglers into _England_, without any
information given to Sir _Charles_, ceased to pay the value of the goods
smuggled from _England_, and sold publicly all over _France_, and when,
instead of a small balance, sometimes given, sometimes received, _France_
found herself obliged to remit to _London_ an enormous sum in hard cash,
for payments which she had hitherto discharged in merchandise?
It is a pitiful policy on the part of _France_, (as remarked very justly
in all the _English_ papers after the first of _August_, 1785) to deprive
herself of a thousand _English_ luxuries which she is so fond of, and
which she is so able to procure;—but is _English_ policy much better, in
rejecting thousands of _French_ luxuries, which she finds so pleasing,
and which she is so able to pay for?
Smuggling is but a very poor corrective, a partial corrective, of the
iniquity ever attendant on Monopoly;—a feeble compensation for the
restrictions and prohibitions obtained in its favour: Smuggling, duly
considered in this light, is but too just; and it is shocking to be
obliged to punish so barbarously the unhappy men who gain a living by it.
But will not this necessity be removed, together with smuggling itself,
at the very moment that to those absurd regulations which encourage
that practice, shall be substituted a system of bartering, equally
advantageous to the nations which now find a benefit in smuggling?—a
system, which would mutually furnish to all parties interested, all
the means of introducing and procuring, in the best condition, at the
cheapest rate, with the least risk, and with the greatest advantage to
the Treasury, every article which before was introduced and procured at
a greater risk, almost always dearer, of the worst quality, and to the
detriment of the public revenue.
Let me ask whether that mass of prohibitions and restrictions, which
_legally_ establishes monopoly in _England_, be any thing more than a
mass of privileges granted to a chosen few, to the prejudice of the whole
community? Were we to look at every particular regulation, and consider
it distinctly, is there one which would not find the whole nation against
it, _except the humble Petitioners who share in the benefit_? And must it
not be very strange to imagine, very absurd to say, and above human power
to effect, that a system of regulations, not one of which favours above
one man against thousands, should, upon the whole, be serviceable to the
State?
Independent of the advantages which would arise from a truly free and
judicious system of commerce, viz. 1st, That of procuring what we
have not, by means of some article which we have in abundance, and
which our neighbours want;—2dly, The bartering of the superfluity of
our best articles in one kind, for the superfluity of what is best in
a different kind;—3dly, Not to barter what we can make cheaper than
others, except for goods which would cost us more were we to manufacture
them;—independent, I say, of these three, advantages, where would be
the inconvenience, though our bartering should be confined merely to the
innocent folly of exchanging one toy for another, or one rag for another?
The great, the true, the only advantage, of an exchange of property,
would not even in this case be lost to mankind; the man who is employed
only in marking the game, while two persons are amusing themselves,
whole days, in tossing a ball from one to the other in a tennis-court,
is nevertheless supported at the expence of the players. And are not the
owner of the court, his wife and children, maintained likewise at their
cost? If, having considered the Exchequer metaphorically, under the type
of the Keeper of the Tennis Court, we afterwards, without a metaphor,
consider this Keeper as a poor man who chooses this way of subsistence,
do not the players pay this tax (which they impose on themselves) in
favour of the poor, with more pleasure, though the tax may be greater,
than a certain other tax, which perhaps becomes necessary, only from
the difficulties with which we embarrass both the game of passing from
one parish to another, and the game of imports and exports, which is as
innocent, and more lucrative than that of tennis?
_The nominal Value of the generality of Exports, considered in different
Periods, and with respect to its Effect on foreign Correspondence._
When a manufacturer is compelled, by the general augmentation of prices,
arising from taxation, to pay his workmen and materials ten _per cent._
I suppose, dearer than usual, and he exports 1000 hats, _upon each of
which_ a draw-back of 6 shillings, I will suppose, is allowed him on
exportation, he does not reflect on the difference of 10 _per cent._
diffused through the general run of prices, by the mechanical reaction of
the total of the taxes on all that is not taxed; he remembers well the
effect of this reaction in the account which he makes out for himself,
to know at what rate he must in future sell his hats in foreign markets;
he only considers the draw-back, the remittance of the 6 shillings duty,
and concludes that it puts him in a situation to deal with foreigners
on the same terms as he did previous to the taxes, which have increased
every thing to the amount of 10 _per cent_. Nevertheless, the thousand
hats, with which, previous to the taxes, he furnished his foreign friends
for 1000_l._ I will suppose, are now raised to 1200_l._—Point out this
circumstance to him, he will tell you he cannot sell his hats cheaper,
and that foreigners must pay 1200_l._ instead of 1000_l._ since the
foreigner wants them. “Besides, (says he) what is the sum of two hundred
pounds more, divided among a thousand persons, who will purchase the
hats from the merchant abroad, to whom he sells them?” The manufacturer
does not want to look further; and the writer who from the nature of his
subject, or his manner of considering it, wants only to reflect a little
more, will only add, _Thus it is that foreigners pay our taxes, and never
suspect that they do so_. This is the truth, but not the whole truth. I
shall endeavour to find it out.
The general trade of _England_ with the rest of _Europe_ is not confined
to some thousands of pounds sterling, to be settled once for all; it
is an immense sum, _which must_ be renewed every year. Let us begin by
being thoroughly convinced of this necessity, in order to submit to its
consequences: we shall find moreover that these consequences are not
destructive.
The annual exports of _England_ amount to about a fifth of the products
of her industry, and consequently represent about a fifth of the labour
of her artificers.
If the taxes, after the war of 1755, had raised the price of every thing
at the rate of 10 _per cent._ (I can err but by a little more or less)
the total of her exports, which, before that war, amounted, on a medium
of ten years, (see Sir _Charles Whitworth_) only to a sum of 12,776,614
pounds sterling, let us say 13 millions, amounted, after the peace, to 14
millions 300 thousand.
Let us now suppose the trade of _England_ exhibiting to its foreign
correspondents, in the year 1762, this total in exports of 13 millions
(at the old prices) under the name of 14 millions 300 thousand pounds,
(a price rendered unavoidable by the advance in the prices of all
commodities, on account of the taxes); and let us suppose these
correspondents to have, really and annually, no more to pay them than
13 millions of their own manufactures, indicated by this modest number,
because they had not the honour to support, during seven years, a war
the most brilliant and successful in the memory of man, in _Germany_,
_America_, and _India_. I think one of the three following consequences
must be the result:
_Either_
That the total of _English_ exports must have been reduced from 14
millions 300 thousand pounds to 13 millions, for want of means in our
foreign buyers to pay the whole amount of _English_ exports at their
advanced price:
_Or_,
That _England_ must have been complaisant enough to call 13 millions, in
a foreign market, the amount of her exports, which the effects of her new
taxes obliged her to call 14 millions 300 thousand pounds at home:
_Or_,
That _England_ must have allowed her foreign connexions to call 14
millions 300 thousand pounds the same quantity and quality of their
manufactures, which, before the effect of _English_ taxation, they called
only 13 millions, and which, _till then_, had made the balance of what
they imported from _England_.
In the first case, the _English_ manufactories, which furnish the
exports, would have been necessarily reduced one tenth; upon which it
is necessary to observe, that the tenth of the _English_ exportation
makes a fiftieth of the total value of the product of her industry, and
that the inutility of the fiftieth of those products, occasioned by
the impossibility of their being purchased by foreigners at the price
occasioned by the _English_ new taxes, must have deprived of subsistence,
as well as of employment, a fiftieth of the _English_ artisans, and
rendered useless a fiftieth of the capitals appropriated to exportation.
In the second case, the prices of commodities would not be perceptibly
increased any where else but in _England_; the prices of her
correspondents would have been, ten years after the peace, almost as they
were in 1754.
In the third case, the prices would have increased, among the foreign
correspondents of the _English_, nearly in the same proportion as in
_England_.
The first case is evidently false, since Sir _Charles Whitworth_’s
_Statements_ prove that the exports of _England_, which amounted, as we
have before observed, upon a medium of 10 years before the war, only to
12 millions 776,614 pounds sterling, amounted, upon a medium of 10 years
after the peace, to 14 millions 921,067 pounds sterling, and even to 15
millions 11,211 pounds sterling, if we take a medium of 12 years from the
peace to 1773, at which period Sir _Charles Whitworth_’s _Statements_
conclude; (which exhibits, _independently of the nominal augmentation
supposed to have been occasioned by the taxes_, a _real_ augmentation of
about a 17th, notwithstanding _the real vacuum owing to the loss of those
men who would have increased this exportation, if they had not perished
in ~Germany~, ~India~, ~America~, and at sea_.)
The second case is more universally acknowledged to be false, since
there is not a single country in _Europe_ where the price of every thing
has not, upon a medium, increased at least 10 _per cent._ from 1754 to
1770;—which proves the truth of the third case:—thus it happens that
foreigners have paid the old taxes of _England_, without suspecting it;
as _England_ does not, in the least, suspect that those taxes are no
longer paid either in _England_ or elsewhere, although their produce
returns nevertheless to the public creditor.
Let us consider, however, whether this general increase of prices could
finally prove prejudicial to _England_, or to her connexions abroad.
It could not prove so to _England_, because she was obliged to submit
to this increase, or else to give up the manufacturing of a tenth of
the commodities she exported to foreign countries (_where she exports
nothing of what she can sell at home_), and because a deficiency of a
10th of her exports would have inevitably deprived a 50th of her artisans
of sustenance, and rendered useless a 50th of the capitals devoted to
exportation. Besides, considering this object in another light, what
loss would _England_ sustain by receiving, under the denomination of
14, I suppose, the same commodities which before were furnished for 13,
while she gave for the purchase, only 13 (old prices) which the effect of
taxation made her call 14?
It could not prejudice her foreign connexions, because this increase
of prices, which _abroad was not owing to taxation_, was only an
encouragement to labour, which must in general have increased its
products, always entitled to a profit over and above the price paid for
that labour.
A circumstance which was necessary for _England_, without doing her the
least harm, has, then, proved useful to the rest of _Europe_.⸺
But let up remark two very essential points:
The first is, that it is impossible in the nature of things, to keep
up foreign consumption, _upon which depends the continuation of our
exports_, without giving foreigners leave to increase the price of
theirs, by so much as the commodities carried to them must be increased
by our taxes;—in the same manner as it is impossible in the nature of
things, to keep up interior consumption, national consumption, _upon
which depends the payment of taxes_, without a general interior increase
in the price of labour, as well as in the price of its products, when the
wants of the State require new contributions.
The second observation which I deem equally essential, is, that such
a work, (_a work of an utility which may be called universal_) has
been brought about, consummated, without the Ministers of any State
whatsoever being entitled to any glory from the event, except that of
having facilitated the operation, if they have favoured the general
liberty of communication in all articles of trade; and without their
having deserved any other blame but that of retarding it, if their zeal,
their greediness for the _favourable balance_, has suggested to them
any _device_ to attract and overthrow it in the only country entrusted
to their management. We must universally ruin Credit, Trade, Commerce,
and the Banking business, if we pretend to prevent Wealth from extending
itself universally, a little sooner or later. _The owner of any kind of
riches whatever, has it not in his power to do any thing else, but to
choose the place, the object, and the time, of giving the first motion_;
all the rest is merely the effect of a stone cast into the water:
observe how the undulations succeed one another, how they are renewed
and extended;—can you fix the point where they shall stop?—We pretend
to direct them!—_Scilicet is superûm labor est?_ ... _Istæne animia
cœlestibus curæ?_—Indeed, indeed, too many cares occupy the minds of our
Gods!
I return to the grand points.
Methinks upon viewing the picture I have drawn, it is easy now to
conceive, why, as I have observed in page 62, _a person, however strongly
convinced of the cruel effect which ought naturally to arise from a
debt of 64 millions sterling, contracted from 1754 to 1762, could not
nevertheless cite in ~England~, from 1763 to 1775, a single indication
of a decay in agriculture or commerce, nor any falling-off in the
enjoyment of luxury, public or private, nor less insolence in the bulk
of the people_. The reason is this: the two capitalists, who failed not
to increase the price of every thing they were concerned in, according
to the exigency of the taxes, determined also (_after a few little
formalities, always necessary with regard to the people, when nothing but
luxury has been taxed_) to augment the price of labour in proportion to
that of its products; foreigners, on the other hand, raised the price of
their goods in proportion as taxes had increased the goods of _England_
exported to them; and the old equilibrium was restored every where, as
soon as the general increase of prices had made the general power of
consumption, equal to the need the State was in of an exterior as well as
an interior, _i. e._ of a foreign as well as a national consumption, in
order that all the taxes might be productive.
But if the debt of 64 millions, contracted from 1754 to 1762, had
increased, by 10 _per cent._ the nominal value of all merchandise
exported from _England_ since that period, how shall we prevent the 60
millions of the last debt, from increasing, from 8 to 10 _per cent._ the
nominal value of all commodities to be exported after this later period?
And if the general augmentation of prices, which has clearly followed the
debt contracted in _England_ from 1754 to 1762, has proved advantageous
to all _Europe_, without hurting _England_, why should not the general
increase of prices, which results, and will inevitably result from the
last _English_ debt, prove unprejudicial to _England_, although it will
prove advantageous to all _Europe_?
But if this increase of 10 _per cent._ generally acknowledged, in the
price of all merchandise in _Europe_, had extended only to the products
of industry; if the price of the total of the produce of agriculture had
not increased in the same proportion;—_had not Nature always silently
and successfully opposed all the dreams of speculation on this head,
to what a degree of misery and wretchedness would not agriculture have
been reduced in all parts of our so much enlightened ~Europe~!_—It was
not so.[10]
The quantity of wheat sold at _Berne_ at 69 _batz_, on a medium of five
years taken from 1751 to 1755, was sold for 92⅗ _batz_ from 1766 to 1770.
The quantity of wheat sold at _Dijon_ at the lowest, 2_l._ 11_s._ 5_d._
on a medium of 5 years from 1753 to 1757, was sold at the lowest, 4_l._
5_s._ 9_d._ on a medium of 5 years from 1766 to 1770.
The quantity of wheat sold at _Bâle_ for 9_l._ 9_s._ on a medium of 5
years from 1754 to 1758, was sold for 13_l._ 14_s._ 2_d._ on a medium of
5 years from 1766 to 1770.
The quantity of wheat sold at _Geneva_ for 27 _florins_, on a medium of
5 years from 1751 to 1755, was sold for 37 _florins_, on a medium of 5
years from 1766 to 1770, (see _Arthur Young_’s Political Arithmetic.)
We find upon the total, from 1755 to 1770, as I observed in my
_Reflexions on a singular revolution in France_, about 40 _per cent._
increase in the price of wheat.—Ten _per cent._ was enough to discharge,
without expence to any body, and without any attention being paid to it,
the interest of the debt contracted in _England_, from 1755 to 1762; but
30 _per cent._ more was necessary, in order to come (without injuring
_England_) nearly to an equality with the _English_ price, a price
advantageous to the agriculture of all _Europe_; an advantageous price,
which the _barriers_ and barricadoes set up in _France_, had till then
prevented from extending to _Switzerland_.
The barriers having been removed, _Switzerland_ and _France_ must
necessarily have been enriched, or _England_ ruined:—_France_ and
_Switzerland_ were better pleased to be enriched; and so it will
necessarily happen after the removal of the barriers subsisting between
_England_ and _Ireland_, that the agriculture of the latter must be
enriched;—unless she should choose to do herself a real prejudice by
keeping to all her former low prices, in order to procure an imaginary
advantage to _Irish_ industry, in hopes of prejudicing the _British_
manufacturer;—which would indeed be very strange.
But if this proportionate augmentation in the price of every thing,—as
evident as it is necessary,—as general as it is useful,—as natural as
it is little suspected,—in consequence of a national debt contracted
by a country trading with all _Europe_,—getting rich by trading with
all _Europe_,—and who cannot get rich without sharing her wealth with
all _Europe_,—be also a complete demonstration of the burden being
NULL, so soon as the little private interests have rendered it general,
and no longer permit the supposition of its being productive of any
other bad effects, but such as necessarily result from a bad system of
taxation; does the point lie in rectifying the system, or in effecting
a reimbursement?—At least, is a tax to be levied for the purpose of
reimbursing, before we have searched deep into THE QUESTION THE MOST
INTERESTING TO SOCIETY THAT EVER WAS PROPOUNDED?
And in the supposition, that it should result from the examination, as
it does from my ideas, _that there neither is, nor can be any real and
lasting harm in the taxes, but that which is the consequence of a bad
system of taxation_; as there is however so much more harm done, at least
of a transient nature, as there are more taxes imposed, even in the
best manner,—would it not be necessary to conclude, that loans bearing
annuities, esteemed the most advantageous to the State, (although they
always require an heavier, and sometimes a double taxation), might have
proved the most pernicious and worst devised, _in any other circumstance
but that of a total discredit_, if they did not now furnish the Sovereign
with the means of redressing what is most oppressive in the old taxes,
without imposing new ones?
_On Luxury._
_I can sum up all that I have said hitherto, by transcribing a couple
of pages out of a pamphlet written in ~America~ in the year 1774, laid
before the Academy of Sciences in 1778, and printed at Paris in 1781.
I should certainly be excusable had I no other motive in this respect,
than to prove that my opinions are neither suggested by, nor depending on
circumstances. The reflexion contained in the following quotation from
that pamphlet, on the war that broke out in 1779, is but a survey of the
new order of things, which would not have presented itself to my mind,
had it not been in my power, even then, to have published in several
large volumes, that which I now comprise within three hundred and some
pages, in order to render its perusal less laborious to the reader._
“All the mystery of society, consists in establishing, without
the knowledge, and to the greatest advantage of the parties
concerned, the most equal, the most exact, and the most
equitable division that possibly can be made, between the land
proprietors, who are in possession of all, and the _pilferers_
who are in possession of nothing.
“This division operates of itself, by shackling, as little as
possible, the natural passions of the one, and the factitious
passions of the others, that is to say, by obstructing, as
little as possible, communications of all kinds.
“This division is inseparable from the greatest possible
quantity of productions and consumptions, which cannot be
effected but by the greatest number of _productors_ and
consumers, who will always be found and attracted where the
laws shall be as little prohibitory as possible.
“A prohibitory law in one country, may be, should be,
and no doubt will be, instantly followed by ten others,
in ten different countries, which will soon enforce the
_re-establishment of the equilibrium dictated by Nature, the
only one that deserves to be attended to, and the only one that
must prevail at last_.
“To the present war, _a war of revolution if ever there was
one_, will probably succeed the only useful and necessary
war that can be waged between nations enlightened by the
longest and most melancholy experience; a war essential to the
happiness of mankind, since the only contest left for decision
will be, who shall prove the most able to devise, or the most
ready to adopt, those laws that are calculated to procure _the
greatest possible consumption_, on which depends _the highest
degree of public revenue_:—
“Discussions these, important at all times, dangerous for
every one a few years ago, unbecoming perhaps in a private
individual at a time when the true politicians of _Europe_ will
find themselves compelled to make them the object of their
most serious meditations;—discussions, in fine, entirely out
of the way of a cultivator, who could not, without a palpable
folly, suffer himself to be led into them by the examination
of his blade of grass, and of a principle too evident to be
contested.” (_Essai sur la culture de la canne à sucre._)
_When a man has shewn himself capable of looking upon a war as the
readiest means that could conduce to a general union of interests,
no one will be surprised if that very man should allow to luxury the
principal honour in the accomplishment of such a prophecy. Nor would
any one be surprised if he were to add, that the rage for luxury, in
a discerning despot, would soon lead him to establish within his
dominions the greatest freedom, from which alone he can expect the
greatest display of all kinds of luxury, the choice and first fruits
of which would be always at his command. Nor again would any one be
surprised were the prophet to add, that wherever luxury should be at its
summit, none but the idle would be at a loss for a livelihood, and that
not a mean one; that even the idiot, as well as the worn-out labourer,
would find there, under the designation of a ~hospital~, an asylum equal
to the habitation of a King:—The habitation of the Kings of Great Britain
is not comparable to some of her hospitals._
Would not the question about luxury, reduced to its elements, like those
other questions which I have touched upon hitherto, present consequences
diametrically opposite to those ideas which perhaps are yet too common,
only because they have not been thoroughly examined? Methinks I have
advanced one step towards the solution of the problem, by proving (if I
have proved it) that the tax laid on that pretended monster, Luxury, is
in fact the most oppressive for the people, on account of the following
effects, from which the impost cannot be freed.
First, If that tax lessens the consumption of the article taxed,
provision must be made, by a fresh tax, for the _deficit_ in the first,
which nevertheless has already deprived of sustenance, those who derived
it only from that article of consumption annihilated by the tax.
Secondly, If the rage for the article taxed, gets the better of the
rigour of the tax, or in other words, of the absurd disproportion thereby
established between the real and nominal value of that article, the land
proprietor has no other resource left, whereby to provide for the tax,
and for the rest of his standing expences, than to raise the prices of
his commodities accordingly; and the poor, whose consumption has not been
taxed, pays dearer, nevertheless, for his bread, and for all that he
consumes besides, whilst the tax laid on luxury alone, is pleaded by all
the _capitalists_ as a pretence for not increasing the price of labour
amongst the people they employ.
Thirdly, If the little private calculations, of which I have spoken, did
not rectify (as I contend they do by degrees, and as they ought to do
sooner) the mistakes of the grand calculations in the administration of
finances; that is to say, if the land proprietor did not increase the
price of his commodities, in proportion as the tax bears heavy on that
article of luxury which he still persists to consume: it would appear
still more heinous in the eyes of the moralist; for those artificers who,
without remorse, without a blush, should employ themselves in the work
of _Satan_, of which the consumption should continue the same, would
subsist undisturbed in peace and plenty on that very work, whilst a
considerable number of scrupulous artisans, employed hitherto on articles
free from censure, but of which the consumption should have decreased by
the counter-blow of the taxes on luxury, would most scandalously be left
starving and unemployed.
I shall now inspect the question more minutely; for all I have said
hitherto is not so much an apology for luxury, as an exposition of the
inconveniences attending its being made the principal object of taxation:
I beg to be excused, if I grow unwillingly more familiar in my style,
when the dignity of the subject seems to require one of suitable dignity
in the manner of treating it.
It is the quality of the land that determines the division of its
products: however ungrateful the soil, the man who cultivates it, first
deducts what is necessary for his subsistence, and a trifle more; the
rest is divided amongst the landlord and some others, for one reason
or another admitted to a share. This division, determined by the most
general quality of the land, brings down the proprietor, who farms out
his estate, to about one third of its productions, and reduces nearly to
the like proportion, those who are employed in wresting them from the
bottom of the earth.
In order therefore to consume as much as 80 men, the proprietor must
have a landed estate capable of giving food to 240; and out of these
240, 160 must be provided for before the proprietor can think on his
own consumption. Consequently, it would be unreasonable to call him to
any other account than for that portion which he has received: but I
readily subscribe to the necessity of having that account examined with
the utmost rigour, since the object is to justify the dissipation of so
considerable a surplus, and since the employment of that surplus, well
ascertained, will give us sufficient light on the employment of the other
parts of the revenue, which by that means it will be useless to examine.
The highest pitch of extravagance, in point of luxury, is, beyond
contradiction, that which, in the smallest possible compass, contains the
largest quantity, as well as the greatest perfection of labour, and of a
labour the most easy to destroy.
Let us suppose a man who, to the fancy of being possessed of such an
article, should join that of seeing constantly at work all those hands
which must be employed to complete it; such a fancy never produces any
other effect, but that of tertiating or doubling the price of things. The
Patriarchs of old, busied and amused themselves, no doubt, in setting to
work those whom they enabled to eat; they lived too near the time when
man was condemned to labour, to maintain them in idleness. The modern
Patriarch of whom I am speaking, provided with a pound weight of flax,
which costs him 6_d._ divides it among 25 working people, who give it
every preparation necessary to answer the purpose it is intended for.
After an entire month of the most slavish precautions, the most minute
details, a thread, hardly perceptible to the naked eye, presents to the
warm imagination of the proprietor, the idea of the _chef-d’œuvre_ of
which this thread is to be the foundation; after 4 or 5 months more,
devoted to the most patient and assiduous industry, he is at last put in
possession of some slips of lace, weighing in all 4 or 5 drachms, picked
out and sorted, thanks to the last refinement of art, from that pound
of flax which had cost six-pence. Five-pence three farthings, and a few
fractions, are then, it seems, in the strictest calculation, the only
real loss—the only devastation which is occasioned by luxury carried to
the highest pitch of extravagance; and this loss is compensated by some
very curious pieces of workmanship, which it is impossible to value at
less than 227_l._ 10_s._ being the amount of 4550 days work at 12_d._
paid to each of the 25 working people, who have owed their subsistence,
for six months, to that pretended inutility.—Amongst all the passions
with which Providence has been pleased to gratify the rich for the
advantage of the poor, name me only one that occasions less devastation,
and maintains a greater number of indigent persons, than luxury carried
to excess. O ye rigid men, who have left off wearing lace, join with me
who have left it off too,—join with me in teaching those who continue to
wear it, how many of their brethren they nourish without knowing it! Make
them virtuous by teaching them, that in order to be so, they need only
do, from a sentiment of humanity, what hitherto perhaps they have done
through a motive of puerile vanity, or from a principle of ostentation,
which, when considered, needs to be considered with some indulgence.
Another aspect, whimsical enough perhaps, but by no means foreign to the
title of this pamphlet, would be that under which we should view those
prodigies of art and patience, as the work not only of 25 artificers
who were busied upon it for six months, but also of 12 or 15 husbandmen
whose existence and labour were indispensable for the sustenance,
during the same time, of the 25 labouring people employed in that great
work.... A peevish man would perhaps exclaim, _Was it indeed worth while
to be born, if all ends with this life?_—And yet, even in this case,
thread-lace ought not to be proscribed: it was not worth while indeed to
come into the world, solely to make lace; but, once born, we must work
at something, in order to bear, without weariness, every instant even of
a life which should not require lace-making for its support: as to the
nature of the work, let us not find fault with that of others, before we
justly estimate our own.... Can we find many of our fellow-creatures,
who on their death-bed are able to shew the work of their whole life ...
worth the smallest shred of lace then in being?
After this single instance of luxury, by which 25 men are fed during six
months at the expence of another, by daily reducing his revenue from
80 to 55, I think that, without being an enthusiast or a declaimer, it
would be difficult, even for a good man in the right sense of the word,
to withstand the pleasure (although perhaps rather of the mischievous
kind) of observing that little more is wanted beyond two such fancies
as we have stated, to bring the Proprietor, reduced in the origin from
240 shillings to 80, and then from 80 to 55—to bring him, I say, exactly
to the level of the cultivator, whom he has brought down to 9_d._
or 10_d._ and of the mechanic on whom he has bestowed 11 or 12_d._;
however, I am willing to allow him 24 for his real, personal, and daily
consumption. Twenty-four pence! will it be said, _What signifies being
so rich, to consume so little_! Yes, twenty-four pence; and this is
by much too much, if we deduct, as we ought, from the price of each
article supposed to be consumed by the rich, the sum that remains in
the hands of the pilferers of all kinds, who stand, unknown to him,
between him and that article.—_How! what say you then to that plate of
green-peas which costs 6, 8, or 10 guineas!_—But, my good friend the
consumer of green peas, if you knew how many pilferers it conceals, of
whom you have not the least idea! if you knew how many wants it has
supplied to some, how many indulgences of luxury it has procured to
others, before it found its way to the table of an Epicure, or of an
ostentatious man!—Let us try to enumerate them: workers of mines and
quarries, masons, carpenters, glaziers, colliers, lock-smiths, _English_
and _French_ sailors for the common-spice trade; _Dutch_ seamen, for the
more precious kinds; ships of war of the three Powers, indispensable for
the protection of the merchantmen employed on those objects; wood-fellers
in _Sweden_, sail-cloth weavers in _Russia_, ship-builders, pilots,
admirals of the three nations, husbandmen busied in the four parts of
the world in procuring food for themselves, in order to prepare food
for all those wood-fellers, glaziers, admirals, &c. exclusive of the
_Dutch_ gardener, and the _French_ cook who alone can worthily crown
the mighty operation.—Imagination loses itself in that single plate of
green peas. How many reductions from 16 pence to 8, and from 8 to 4,
have been required to produce it! It is inconceivable that it should
not sell for more than 6 or 8 guineas;—but if each of those pilferers
above mentioned takes back the small portion by which he has increased
the intrinsic value of the article.... O ye, who must have swallowed up
500 _properties_, in order to eat, without being guilty of extravagance,
that plate of green peas, and who flatter yourselves with the idea
of having consumed on that day fifty or sixty crowns worth, learn and
reflect henceforward, without remorse and without vanity, that you have
not spent above half one penny, the real value of any other dish of
greens which you might have substituted to the peas you have consumed.
Scrutinise, in the same manner, your wearing apparel; choose, like a
child, what pleases most the eyes of the body; or, like a fastuous man,
all that is most imposing to the eyes of the imagination; or, miser-like,
that which costs least money; or, in fine, like a man of sense, what
your means or your taste incline you to wear; the difference, as to
essentials, is little or none. It cannot be positively asserted, that
your consumption will be more or less considerable in one than in the
other case; but recollect that thread lace, for which you could not pay
less than 227_l._ 10_s._ because there stand between you and the pound of
flax from which it has been extracted, 35 or 40 intermediate pilferers,
to be fed during six months;—this lace, however, in spite of that
extravagant price, could not, as you have seen, be set down to account
amongst the articles of your real and personal consumption, for more than
sixpence, supposed to be the intrinsic value of a pound weight of flax,
which has gone through so many hands to be converted into lace. Now, on
this principle, you might be wrapped in lace from head to foot: and your
entire _mummy_, instead of presenting to the eye of a sworn appraiser
a consumption of 30 or 40,000_l._ would in this instant of its highest
splendor, only present him with a devastation of 200_lb._ of flax,
sacrificed to decorate that mummy, or to hide its defects.—And as the
object would be 200_lb._ of flax, the value of which is fully known by
the number of people to whom it would afford support, instead of dealing
so lightly as I did with a single pound, when I introduced my Patriarch,
the appraiser would reckon with you rigorously; he would consider, that
in the hands of the Arts, no part of the works of the creation can be
lost; that, as it is their triumph, so it is their duty, to divide into
10, 20, or 30 parts, whatever requires such a division, in order that
each may receive the degree of utility of which it is susceptible, and
which the Arts are bound to account for to society: the appraiser would
then carry you to the lace-merchant, in order to lay before you ten
different sorts of an inferior lace, taken from parts chosen successively
after that which serves you for a wrapper, and descending still from
pilfery to pilfery, he would at last inveigle you into the cabins of
some pretended wretch, where he would shew you the quantity of coarse
and substantial shirts, necessary to teach you that 3 or 4 _lb._ of
flax, at the most, are the only possible devaluations your mummy can be
reproached with, as two shillings are the only expence your vanity can
boast of in the 25 or 30,000_l._ which you could presume to have consumed.
Yet, let us grant something to the pretended importance of being
possessed of 500 _properties_, each of them sufficient to the support
of one man. I shall accordingly suppose you to be habitually cloathed
in those stuffs, which, to the richness of the materials that compose
them, join the perfection of workmanship, (which concerns you, as you
have seen, in no other light, but that of either a benevolent, or an
unintentional provider for the necessary consumption of the labouring
man);—but 10 _lb._ of silk, as they come out of Nature’s hands, are not
worth 30 shillings:—without enquiring why they may then be valued at 30
shillings, bring all the other parts of your dress to the touchstone I
have furnished you with; consider, that if you wear the same coat every
day, it would be far from being worn out at the end of the year,—and
how far it would be of course from standing for two or three pence
in the account of your daily consumption;—add thereto your real and
personal wastings in coals, wood, pomatum, essences, elixirs, &c. _valued
after the same principle_;—at what a distance you still remain from
the 24 pence I have granted you for consumption!—And do not say that
you renew your coat every season;—had you swallowed up 5000 instead of
500 _properties_, and should you change cloaths every day, your real
consumption would not be the greater for it: would not your _valet
de chambre_, to whom you should have given that suit of cloaths, for
which you had paid 40 guineas, and which you had worn only once—would
not, I say, your _valet de chambre_ sell it for 15 guineas to an old
cloaths-man, who would get 20_l._ for it from a strolling player?—Be
pleased now to trace that suit from _Paris_ to _Lisle_, to _Brussels_,
_Dresden_, _Poland_, _Russia_; see how many people will get a livelihood
by carrying it about; how many guineas it will bring to the travelling
_Roscius_, who will shine in so many countries at your expence; reflect,
on the revolutions which the elegance of that dress will occasion in
the modes at _Petersburgh_; how many draughtsmen, embroiderers, working
people of all sorts, will be employed and fed, (_thanks to your luxury_),
in copying that master-piece of taste and fancy.—This is not all; you
might probably, at the end of 15 years, meet again in _Paris_ with the
same suit, cut into small pieces, in the hands of some ladies of the
first rank, busily engaged in unweaving the rags, to send, as soon as
possible, those precious relics of your seemingly spoiled cloaths, to
_Lyons_, &c. where ten workmen are waiting its arrival, to get bread by
restoring to it a great part of its former value, under another form.—And
you would presume to have consumed it?... The work of God is not so
easily destroyed, nor his beneficence so easily concentered.
_Was it worth being so rich, to consume so little?_
Were you to say, _Is it worth while to commit an injustice in order to
grow rich, when we can consume but so little, and when the means are so
numerous of pilfering so lawfully all that is wanted for consumption?_
I could then understand you;—but since you are in possession of 500
_properties_ without having been guilty of injustice, it is something to
reflect that they are really to you, the source of numberless enjoyments
which you have it in your power to render worthy of a rational being:
and, as the continuance of those enjoyments depends entirely on the
health and bodily strength of so many others who are to contribute
thereto, it is something to be conscious that we find our own pleasures
in the interest of others; it is something to reflect, that these
pleasures are a very gentle mean, devised most probably by an universal
_Watchfulness_, to induce you to provide men destitute of every thing,
with that _modicum_ of goods which was not granted to them, and which,
nevertheless, being necessary for their sustenance, is sufficient to
their moderation, and prevents their feeling the privation of all the
rest: it is something to reflect, that you feed in fact 50, 100, 500
perhaps of your brethren, amongst whom there are 10, 15, 30, as well
fed as yourself, since they live on what comes from your table. As to
the others, whose faces you will never see, since some of them are at
_Pekin_, in _Arabia_, at _Constantinople_, and others in _France_,
_Russia_, &c. be assured that, with much less meat than you, but more
bread, potatoes, or rice, and a few glasses of an acid liquor, the idea
of which, whilst I venture to speak of it, is enough to crisp all your
nerves, they are as contented, as happy as you, because they consume,
without any reflection, without any solicitude for the morrow, all they
want, in order to view that morrow with the same tranquillity.—Would it
not be unjust in that Being, _who weigheth the mountains in a balance_,
if there were, amongst men, one condition more unfortunate than another?
Would he not be unjust, if amongst men, there were one condition more
blessed than another? I suppose, indeed, that there exists a Being,
_who weigheth the mountains in a balance_, as others have supposed that
there is a future life, where happiness is more visibly equal; and I
have hitherto ventured upon so many suppositions!—yet I would beg leave
to offer one more, relating though indirectly perhaps to the object
now under consideration; but this shall be the last: I will ask (upon
the supposition that there really exists a Being, not only Estimator,
Moderator, but Creator also of all that thinks, wishes, and can be
happy) ... yes, I presume to ask, whether the created being, capable of
conceiving the idea of giving immortality to the creature capable of
wishing for it, of fostering the hopes, and feeling the value of it,
would not be greater than the Creator himself, if the Creator had not
conceived such an idea?—I freely confess, that I should think myself
better than the Creator, had the Creator conceived such an idea without
putting it in execution.
I now return to the point which requires no kind of supposition, I
mean the real consumption.—Let us pass from that very insignificant
possessor of 500 _properties_, to the greatest Monarch upon earth.—What
difference is there between his consumption and that of the meanest of
his subjects?—He has the choice of every thing, such is the _ne plus
ultra_ of his power: three, four, or five pounds weight of nourishing
food, are really as sufficient for the one as they are necessary to the
other;—and on all points, what is the object that procures to the Monarch
either advantage or pleasure, the price of which as paid by him, _were it
even of fourfold the value_, is not exactly composed, both of the amount
of the sustenance that was necessary to the production of that object,
and of a sum which will infallibly pay for other productions, which must
be purchased to forward new ones—_from which the people will constantly
have deducted their necessaries, before they are permitted to satisfy the
superfluities, the luxury of any whosoever_?—Such is that never-ending
screw, that adorable chain, which nothing can stop or break, unless it be
the insanity of a monster, who should receive that fourfold price, and
bury it under ground, lest it should prove useful to society.—That wretch
was very consistent with his feelings, who wished the _Roman_ people
to have but one head, that he might exterminate the whole nation at a
single blow; but the phœnix will ever rise from its ashes; and Humanity,
with all her resources, all her rights, would be reproduced from the very
stones, were it possible that not a single head should escape the sword
of that _consistent being_ who might wish to cut them all off.
_Thoughts on the Colonies._
The question concerning luxury leads to the investigation of some ideas
on the Colonies; I do not mean that of taxing them, either in a direct or
indirect manner, for the reason truly specious, that the wars undertaken
for their protection, having loaded the nation with taxes to an enormous
amount, it is but just that they should come in for a share of the burden.
It has been observed, that a national debt contracted, no matter for
what, occasioning in every thing an indispensable increase of price, the
Colonies pay their quota of such a debt (notwithstanding the drawbacks)
when they purchase goods at the rate to which the said debt has advanced
them: it must also have been noticed, even how necessary it was that the
price of commodities from the Colonies should increase in proportion
to the price of those of the Mother-country, in order that the former
might be able to answer that advance of prices, without hurting the two
essential points, consumption and re-production; whence it follows,
that if new taxes are introduced, _either directly or indirectly_, to
defray their pretended proportion in the interest of the national debt,
neither harm nor good will result, _if the price of their commodities be
increased in the same proportion_; but that if they be taxed, without
that increase in the price of their commodities, they will consume by
so much less of national goods _or of foreign ones paid for in national
merchandise_, that is, to the amount of the sum which the tax shall have
taken from them: this point is evident. Thus it is, that after the war
in 1755, all _Europe_ was obliged, as has been shewn, to increase her
prices, so as to put them on a level with those in _England_; and had not
_Great Britain_ submitted to that reciprocal advance, and all the rest of
_Europe_ condescended to receive only, for the 13 _effective_ millions of
their own goods, the 13 _nominal_ millions of that quantity of _English_
commodities which was worth 14, on account of the taxes only, the nominal
million which would have remained in the hands of _England_, would have
been without value, _and no longer reproduced for want of consumption,
for want of means to pay for it, and to encourage such a reproduction_.
I think also that it is useless to examine whether the colonies can add
any thing to the real power of a nation, since, in order to be convinced
of the very reverse, it is enough to observe, that if 2 or 300 ships
mounting from 10 to 120 guns be required, in order to protect effectually
an extent of between 1500 and 2000 leagues of _colonial_ coasts, distant
1000, 1500, nay 4000 leagues from the mother-country, the 100,000
men employed in time of war, on those floating citadels, are always
furnished by the Metropolis, and do not in any manner exempt her either
from erecting those permanent citadels which must be scattered along
the coasts of the mother-country, or from providing the number of men
necessary to defend them in case of an invasion. In this point of view,
the colonies would therefore rather diminish than increase the national
power.
On the other hand, experience has just taught us, that as soon as those
very colonies, for which it is pretended so much blood has been spilt,
and so much money wasted, are in a situation to stand up in their own
defence, there is no depending upon them, but inasmuch as they are on
the footing of allies; and interest alone fixes the duration of every
alliance.
The above three objects deserve not, methinks, any further dissertation:
the question that merits a more particular scrutiny, is that which
concerns the utility of those very colonies, when their weakness is a
pledge of their fidelity.
That utility consists in securing to the mother-country, 1st, an
exclusive mart for such goods as she thinks proper to export there; and
2dly, the exclusive sale of the returns, in which, it is said, she finds
a compensation for the expence she is at to carry her goods to that
market.
I shall investigate, under various points of view, all relative to those
two objects, the utility of those colonies whose commerce is fully
ascertained, before I speak of any other; and I shall only draw the
necessary inferences from the most incontrovertible facts.
_1st._
We find in the Statements of Sir _Charles Whitworth_, that the exports
from _England_ to the colonies, whose independence can no longer be
disputed, amounted annually, upon a medium of 5 years, taken from 1769 to
1773, to the sum of 2,491,230_l._
Now the two wars of 1739 and 1755, undertaken, it is said, for
the protection of those colonies, that is, _to preserve_ to the
mother-country _the monopoly of them_, have cost _Great Britain_
99,141,625_l._; and these 99 millions, though the interest has been
reduced as often as possible, still cost _England_ annually 3,500,000_l._
It is then a sum of 3,500,000_l._ which, even so early as the year 1762,
_England_ had resolved to pay annually, in order to preserve, and the
better to secure to herself the exclusive privilege of exporting annually
to _North-America_, _European_ goods to the amount of 2,491,230_l._
_2dly._
The imports from those colonies into _Great Britain_, upon a medium
of the said 5 years, did not exceed the sum of 1,208,665_l._—_Great
Britain_, therefore, has enjoyed during the space of 5 years, a pretended
balance of 1,282,565_l._ against those colonies;—but is that glorious
balance any thing more than the advantage of having given to those
colonies, in the space of 5 years, a credit in the sum of 6,412,825_l._
supposing that such sum was the amount of her claims in that part of
_America_, or of the half, if in fact half only of that sum remained
due to her, notwithstanding the enormous appearance in Sir _Charles
Whitworth_’s Statements?
_3dly._
If the colonies, now independent, will henceforth call in all the other
nations of _Europe_ to a share in the advantage of crediting them in the
same manner, can it be supposed that _England_ will not find in _Europe_,
some other nation willing to receive that part of the _English_ credit,
which the independent colonies shall no longer think proper to make
use of? In this case, can any thing more be required, on the part of
_England_, than to manufacture in less quantity such goods as suit only
the inhabitants of _America_, and somewhat more of those that may suit
the different nations of _Europe_; and to this first operation to add the
complaisance of receiving a greater quantity of their goods than she has
imported hitherto?—In this case likewise, what ruinous consequences could
_England_ experience by exporting her goods to her neighbours, instead
of sending them to _America_?
_4thly._
If the complaints set up by _England_ against the United States, are
grounded only on their incapacity of making returns proportionate to the
value of the goods exported there since the peace, are the United States
to blame if _European_ cupidity has exported to _America_, in the space
of six months, as much as its inhabitants could consume and pay for in
two years? Does such an event, almost infallibly the result of a long
interruption of correspondence, prove any thing more than the necessity
of a balance between production and consumption, the advantage of knowing
as soon as possible the difference from the one to the other, the
inconvenience of a trade, in which we lose sight of our capital for whole
years together, and the advantage of a trade which would 5 or 6 months
after return to the hands of the _capitalist_ the stock he had laid out?
_5thly._
Had even those colonies remained in, or returned to a state of subjection
to _England_, would not the same interruption of correspondence have been
productive of the same inconvenience?—During the war, which terminated
by the treaty of _Aix-la-Chapelle_, all the _French_ colonies had
remained under the dominion of _France_, and yet during all the first,
and great part of the second year of peace most of the _French_ goods
were sold at _Martinique_ and _St. Domingo_, 15 and 20 _per cent._ below
the prime cost in _Europe_;—between dependent and independent colonies,
then, in this respect, who can perceive a shadow of difference?
_6thly._
If the _English_ merchants, after having over-stocked the _American_
markets with _European_ goods, have attempted to strip _America_ of the
little money she had to boast of, and to leave her goods on her own
hands, do the complaints set up in _England_ on this subject, prove
any thing essential either to _England_, or to the rest of the world,
more than the impossibility of carrying into execution beyond a certain
degree, the plan, as destructive as it is absurd, of any other trade but
that which is founded on a reciprocity of advantages, on _an exchange of
the gifts with which Nature and Art have favoured one country, against
those with which Nature and Art have favoured another country_? And
even, upon a supposition, that _America_ should have returned under the
domination of _England_, if the _English_ merchants had, in this case,
attempted to wrest from her the little money she was possessed of, would
not the _American_ colonists have been justified in taking every measure
necessary to preserve it?—Would they in enforcing that right have been
free from the misfortune, common to mankind, of always doing, in order to
guard against an injury, much more than is either just or necessary?—The
impossibility of making returns adequate to the extravagant invoices sent
by the _French_ traders to their colonies in _America_, after the war
I have mentioned, determined also the agents of the _French_ trade to
strip those colonies of all the money they could lay their hands upon:
no other way to put a stop to that spoliation was left, but to bore in
the middle of their dollars a large hole, which restoring the equilibrium
between the rapacity of the foreign trader, and the wants of the interior
commerce, preserved within those colonies the trifling sum in specie
that still remained there. Soon after, the equilibrium was also restored
between the imports and the consumption; and from that instant an end was
put to the thirst after money, as well as to the necessity of boring the
dollars.—What difference then can exist, in this respect also, between a
colony and a free State?
_7thly._
All the exports from _England_ to the colonies, the monopoly of which
she has preserved by the peace, (including her trade to _India_)
amounted, in 1773, to 2,430,420_l._ (for the details see Sir _Charles
Whitworth_). Now the annual expence of the _British_ navy, and its
accessaries, considering the increase in that of _France_, must be, at
present, or will be soon, 2,000,000_l._ May it not be fairly concluded,
that _England_ is about to pay the annual sum of 2 millions sterling, in
order to maintain herself in the exclusive privilege of carrying annually
to the distance of 1500, of 2000, of 4 or 6000 leagues, the value of
2,432,420_l._ in _European_ goods?—And would not that privilege be dearly
bought, were not _France_ to lay out annually likewise 45 millions of
livres _tournois_, in protecting her privileged exportation?
_8thly_,
I have at present before my eyes no other standard, whereby to estimate
the exportation of _France_ to her sugar-colonies, than that of _England_
to hers; that exportation amounted, in 1773, to 197,236_l._ But the
population of the _French_ colonies is far from being in a treble
proportion to that of the _English_ colonies, and luxury is equal in
both; yet let us suppose that the amount of the exports from _France_
to her colonies, including those she sends to _India_, be annually 80
millions _tournois_.—The interest of the national debt in _France_ is 202
millions _tournois_, (see _Administration des Finances de la France_)
one half, or rather three fourths of which have been incurred for the
protection of her establishments in those parts of the world.—May it
not be said, that _France_ is at the yearly expence of 150 millions
_tournois_, independently of the 45 millions for her navy, for the
purpose of maintaining herself in the exclusive privilege of exporting
every year the value of 80 millions _tournois_, in _European_ goods, to
her possessions in _India_ and _America_?
_9thly_,
All the _European_ exports, carried by _England_ in the year 1773,
either to _India_, _Africa_, or _America_, including the exports for
which she held an exclusive privilege in the part of _America_ now
independent, amounted to 4,975,192_l._ we shall say 5 millions:—if you
value at 10 millions of the same currency, the exports of all the other
nations of _Europe_ to those parts of the world, we shall find a capital
of 15 millions sterling in goods annually exported from _Europe_:—but
the yearly expence of a navy, which cannot be dispensed with for the
protection of those exports, is valued at 8 millions sterling, 4 of
which fall to the share of _England_ and _France_.
Exclusive of those 8 millions sterling, the interest paid by _England_
to acquire, preserve, and protect that part of _European_ exports that
concerns her, amounts to about 6,500,000_l._ including that of the last
war; the interest paid by _France_, comes nearly to the same sum; the
interest paid by _Spain_ could not be computed, were the depopulation
of that country to be taken into the account; but estimate them at 4
millions, including those which other _European_ nations have sacrificed
to the same Idol: let us say nothing about _Holland_, who for many
years (except the few last) has made some figure _Europe_, only by her
good luck in alleviating the distresses of others, her sole motive for
which was her own advantage: and we shall sum up, at last, an annual
expenditure of 25 millions sterling, in interest and naval expences,
incurred by _Europe_, in order to preserve the exclusive privilege, 1st,
of exporting every year 15 millions sterling in _European_ goods to her
colonies, both in _India_ and _America_; and, 2dly, of establishing in
those colonies _the system of government best calculated to prevent that
exportation from becoming more considerable_.
_10thly_,
We have observed, that the exports from _England_ to the colonies of
_America_, and to _India_, amounted, in 1773, to 4,900 and some thousand
pounds sterling, suppose 5 millions: now her importation of commodities
from those various countries is about 5,900,000_l._ (see Sir _Charles
Whitworth_); but we have also noticed, that she left yearly in _North
America_ 1,282,000_l._ more than she received therefrom. This matter,
considered in the most favourable light, that is, as a balance of trade,
ought to be added to the former; and the whole together will give us a
total of 7 millions, shewing an annual benefit of 2 millions some hundred
thousand pounds sterling.
It appears then, that an annual benefit of 2 millions some hundred
thousand pounds sterling costs _England_ annually 6,500,000_l._ interest
for her debt, and 2 millions for the support of her navy.
_11thly_,
We have seen, that the annual and general exportation of _European_ goods
to _America_ and _India_ amounted to about 15 millions sterling.—If 5
millions of _English_ exports return no more than 2 millions some hundred
thousand pounds annual benefit to _England_, that _England_, who sets
the highest price on her goods of all kinds, the general exportation of
15 millions, to which _England_ contributes only one third, cannot, of
course, afford to the whole of _Europe_, a profit of above 6 millions and
some hundred thousand pounds;—but it seems that a benefit of 6 millions
and some hundred thousand pounds is dearly bought at the rate of 25
millions laid out annually by _Europe_, both in paying the interest of
their respective national debts, and for the support of the _European_
navies designed to preserve, protect, and secure such a benefit.
_12thly_,
If it were very true, as it is to this day asserted, that those 25
millions of annual and indisputable expenditure, are in reality so many
yearly losses to the nations who sustain it, might it not be reasonably
concluded, would it not be impossible not to conclude, that all the
colonies of _Europe_ were established only for her ruin?—If we only
attend to the last war, which in fact loads the different nations who
took a share in it, with an annual interest of 9 or 10 millions,—9 or 10
millions to be paid every year, partly to preserve the right, partly to
obtain the permission of exporting _European_ commodities into a country,
of which the inhabitants, besides their own importation, consume annually
to the amount of only 2,491,230_l._ of those same commodities which are
exported to them by others—who (to assume the trader’s phrase) cannot
clear by that exportation, a greater annual profit than 3, 4, or even
500,000_l._! ... it seems indeed that one cannot see without surprise and
concern, the shocking disproportion between the end proposed, and the
sole means of obtaining it.
_13thly_,
If, on the contrary, it be true, as I maintain it to be, that after the
peace, when a perfect equilibrium is restored to every thing, the 9 or
10 millions interest of the national debt, has no other effect but that
of ADDING TO EVERY THING A NOMINAL VALUE WHICH INJURES NO ONE, THOUGH
IT MAY BE ADVANTAGEOUS TO MANY; A NOMINAL VALUE, WHICH, IN EVERY STATE,
PROPORTIONS ITSELF, FIRST TO THE SUM OF ITS REVENUE COMPARED TO THAT OF
ITS DEBT, AND SOON AFTER TO THE DIFFERENCE WHICH THE DEBT CONTRACTED
BY THE NATION CALLED THE MOST LOADED, AND WHICH, IN FACT, IS ONLY THE
GREATEST EXPORTER, HAS PRODUCED IN THAT ENORMOUS QUANTITY OF THE GOODS
SHE EXPORTS;—if it appear more reasonable to adopt that idea, than to
give up a trade, which, without that very idea, would prove the most
absurd, as well as the most destructive that human genius could invent,
(_the alternative seems to be forcibly established_);—in this case the
regret will be heart-felt, when we consider the loss of men sacrificed
during the last war: but if from this general aggregate of truths little
suspected, and much less reflected upon, there should result a system
of Politics in _Europe_, of Administration in her different States,
of Government in her Colonies, which should procure to _Europe_, at
the least expence, the greatest exportation of that of which she has a
superabundance, and the greatest importation of that in which she is
deficient ... then indeed, then, might we find consolation for the evil,
in adverting to its consequences.—And, upon this principle, what can
_England_ have suffered by losing her sovereignty over _America_?
_14thly_,
The contagion of example has been apprehended. Let us suppose the fact.
What then would be the loss sustained by _Europe_? None, I believe,
unless the consequence of the general independency of the colonies,
should be that they would give up _European_ commodities they have been
used to, and which they can so readily procure by means of a multitude
of other articles, which would be of no value to them were they not
calculated to procure them those _European_ commodities which they are
in the habit of consuming.—But I beg leave to ask, what purpose could
their independence answer?—It appears to me, they could not think of it
without a palpable folly; and that it is impossible they should think of
it, _without that kind of vexation which brings a man to the necessity
of choosing between two extremes_.—Another consideration, which tends to
make _Europe_ easy, at least in regard to the colonies situated beyond
the tropic, is, that no rivalship can subsist between them and their
mother-countries in any thing that concerns the soil and industry.
In regard to the productions of the soil, all that part of _America_
inclosed within even the 30th degree of north, and the 30th degree of
south latitude, could not yield, without double and treble expence,
any thing that can be produced in _Europe_, and in the other part of
_America_, from the 30th degree to the pole. And, on the other hand, at
what an amazing expence must all _Europe_, jointly with that part of
_America_ now independent, produce, even in a kind of degradation, what
the other part of _America_ yields naturally in the most perfect state!
In regard to industry, can it be feared that the _South Americans, even
supposing them independent_, should be tempted to import rough materials
from _Europe_, in order to have them wrought by _American hands, which
are so naturally and so profitably employed in the production of American
articles_? Is it even to be feared that they should aim at a competition
with the _Europeans_ in the exportation of _American_ articles, when they
are in need of ship-timber, or rather when in this, much more than in any
other respects, there is no _European_ work, which, if done in _America_,
would not cost three times as much as when imported from _Europe_?—All
_European_ prejudices, relative to commerce, are founded on the following
principle, which may be looked upon as the _quintessence_ of the
Navigation-Act:—_To do every thing ourselves, in order that no one’s
assistance may be wanted,—that no one may do without our assistance,—and
that no assistance be given, but at the prices prescribed by the Lords of
the Seas._—The Navigation-Act was, without doubt, the last effort of the
human mind about the middle of the 17th century[11].
It seems to me, that the only point which essentially concerns all
_Europe_, in regard to other parts of the world, where she can give law,
would be to find out _what kind of Administration would be the best
calculated to increase in all those parts the consumption of ~European~
_goods, and to procure to herself a more considerable stock of foreign
goods and products,—which would, as they have ever done, give, ~either
directly or indirectly~, a fresh encouragement to her agriculture and
manufactures_. Let any one examine, whether the utility of the colonies
be not strictly confined to this single point.
I speak of all _Europe_, it is true, as if she formed but one State,
whilst she is supposed to exhibit so many interests, and these so very
opposite to each other. This question deserves a deeper discussion than I
am able to give it; yet I presume to think that the answer I could give,
might be susceptible of demonstration, had we, on all the countries in
_Europe_, statements only similar to those which Sir _Charles Whitworth_
has given of the _British_ trade, and were we to add thereto the means
and faculties which are to be met with in _England_ of procuring the
details and proofs of every particular that concerns the public.
Destitute however of an advantage so precious, so worthy of a nation
sufficiently enlightened to dread nothing but being left in the dark
on any part of her own interests, of a nation judicious enough not to
disdain a ray of light, from whatever quarter it may come, and generous
enough to perceive, with pleasure, that by enriching herself, she has, to
this day, enriched all _Europe_;—
If it were admitted, that money is only the representation of value;
that multiplying the sign, without multiplying the articles which it is
calculated to represent, is debasing fruitlessly the representation; and
that, on the contrary, multiplying the article is the most infallible
means of attracting the sign and keeping it up to its value:
If it were acknowledged, that nothing contributes so much to the
multiplying of the articles, as the multiplicity of the channels through
which they can be introduced:
If it were acknowledged, that the multiplicity of channels in another
nation, for the introduction of our own goods, is necessarily inseparable
from the multiplicity of channels opened in our own country for the
introduction of foreign goods:
If it were acknowledged, that with the fullest persuasion that money
ought to be the sole aim of trade, it has only proved, hitherto, the
means of supporting it:
If it were acknowledged, that notwithstanding the prejudices to the
contrary, as deeply rooted in the heads of Ministers, as they are in the
hearts of Merchants, and notwithstanding all the national cupidities,
private interest in all countries has always proved sufficient to reject
effectually all the _useless_, and procure all the _necessary_ money:
If it should result, not from arguments, which very seldom contain what
they ought to contain, in order to become uncontrovertible, but from
the experience of a whole century, sufficient to estimate the effect of
the passion the most ardent, and the most attached to its object, that
contrary to the common ideas, and in spite of the general rage for money,
the whole of commerce has, to this day, been ultimately confined to _its
true balance_, i. e. _to bartering goods for goods_, except the little
money which is wanted every where, and which has constantly penetrated
every where, to answer either to the new productions when they had
actually increased in their quantity, or to the advance of prices when
the taxes had at last produced every where, and on the generality of
prices, their effect, as equitable as it is necessary and harmless:
If the same experience should evince, that the richest individual, or
he who becomes such the soonest, has no other advantage in point of
commerce, than the choice of the men whom he is pleased to admit to a
share of his wealth without impairing it; and that the inference to be
drawn therefrom is, _that such a man must be a dupe who confines his
choice to ten, when he can make it from among thirty_:
If it were acknowledged, that riches and ease, like the light, stand in
want of no assistance whatever, to propagate themselves equally in every
direction, _as general interest requires_; that the private interest of
one man, or of a body of men, is always sufficiently opposed, protected,
balanced, by the interest of another man, or of another body of men,
_wherever administration confines its attention to the maintenance of
strict justice and good order_; and that from this equilibrium in which
they mutually keep, or soon replace one another, there results, for both,
the greatest advantage they can hope for, and for the State the highest
prosperity it can attain:
If it were acknowledged, that on all these various objects, no difference
whatever can subsist between one nation and another:
If it were acknowledged also, that all _Europe_, as well as each State
in particular, is essentially, finally, strictly, composed only of three
kinds of _capitalists_, or proprietors, the _landed capitalist, the
capitalist of industry, and the proprietor of money_, considered either
as a dependant or as a _capitalist_:
If it were acknowledged, that those three interests center in the
greatest quantity, as well as the greatest variety and best quality,
of the products both of agriculture and industry, and in the greatest
consumption of both at the most reasonable rate:
If it were acknowledged, that the _Fisc_, or Exchequer, owes the whole
of its revenue to the produce of the taxes only; and that this produce
rising of course as the productions and consumption increase, the
interest of the Exchequer can no where be different from that of the
three capitalists or proprietors:
If it were acknowledged, that _at present_ nothing can result from
several institutions, pretended very wise, but a great diminution in the
products and consumption, as well as in the revenue of the Exchequer;
because there is nothing so easy as to balance, every where, institutions
pretended very wise, by others not less so:
If it were acknowledged, that the _necessary_ expenditure of the
Exchequer once ascertained, all diminution of its revenue, occasioned by
the pretended very wise institutions, carries with it the necessity of
imposing new taxes, in order to make up the _deficit_ of former ones:
If it were acknowledged, that each new tax, increasing necessarily the
price of every thing in the nation, _for the purpose of supporting, at
least, the interior consumption, on which depends the discharge of the
taxes_, would add to the inconvenience brought about by those pretended
very wise regulations, _and would soon lead to a decrease in the external
consumption, which the nation might have preserved_, if other countries
did not raise their own prices accordingly, in order to pay with the
same products the same quantity of articles which they used to take
before the advance occasioned by the taxes; that therefore such a general
propagation of increase in prices, being of a general interest to the
production and consumption every where, would not fail to take place
every where as it has always done, and to dwindle again into a childish
play, much beneath the adolescence of the age we live in:
If it were acknowledged, that the general repeal of those pretended very
wise institutions could, at the worst, be productive of no other effect
_within the State_, but that of a general rise in the prices, wherever
they are not in due proportion to the real values, and a general fall
in all the prices, wherever they are fixed by monopoly, and not by the
natural equilibrium; but that, whereas nothing but profit can accrue to
those who raise their prices, it is very probable that the prices would
increase much more almost _every where_, than they would decrease _any
where_:
If it were, besides, acknowledged that such an increase, or decrease,
(it matters not which) soon becoming general and proportionate, (without
any other agent to work that miracle, but that reciprocal pressure which
establishes a perfect symmetry in a bee-hive,) then no alteration could
arise therefrom in the circumstances of the two essential capitalists,
since it is perfectly indifferent whether we purchase the labour of
others at 5 or 6 _per cent._ dearer, if we sell our own labour in
proportion:
If it were acknowledged, that in regard to the money proprietor, _whether
dependant or capitalist_, nothing can result from it but the certainty
of procuring henceforth and for ever, at the most equitable price,
that which he had paid for hitherto according to the rate set on it by
monopoly, and often by a scarcity cunningly prepared and managed:
If it were acknowledged, that _as to the external interests of the
State_, no other effect can result from the general repeal of those
pretended very wise institutions, but the facilitating of all the
branches of foreign correspondence, the opening of new channels of
consumption, the encouragement of all kinds of production, of which
consumption is the very soul, and the power of obtaining every where, at
the most equitable prices, _by means of competition_, the most equitable
share we have a right to expect in those gifts which nature, in all
probability, has not bestowed on any part of the world, to confine them
to that particular spot:
If all the foregoing points, I say, were acknowledged, it would be a hard
matter to conceive that there is, not only in _Europe_, but all over the
globe, any other enemy to destroy but Monopoly, or any other interest to
favour but Labour.
FINIS.
_The judgement of the Public, on the ideas thrown out in this Essay,
will determine the fate of some others, which are nothing else but the
consequences or developement of these._
PRÉFACE _DE L’ÉDITEUR_.
Ce n’est point un _Traité_ que l’Auteur annonce: ce n’est rien de plus
que des _Considérations sur le Méchanisme des Sociétés_. Un pareil titre
n’astreint point à un plan régulier, & sauve même le risque de préparer
les Lecteurs à un enchaînement d’idées qui n’échappera point à leur
sagacité, s’il existe; & sur lequel on ne les abuseroit point, s’il
n’existe pas. Mais dans un tableau consacré au monde comme à la patrie,
aux peuples comme à leurs maîtres, il falloit que l’objet saillant,
l’objet sur lequel on dirigeoit leur première attention, fût d’un intérêt
assez général pour les engager progressivement à l’examen de tous ceux
de ses détails qui méritent d’être approfondis, & dont les rapports sont
méconnus ou mal jugés.
L’objet qui fixe aujourd’hui l’attention de tous les États de
l’_Europe_, tous débiteurs & créanciers, c’est la dette publique de
l’_Angleterre_, & les mesures que va prendre à ce sujet, l’Assemblée
du monde la plus éclairée sur les intérêts du peuple, la plus jalouse
de ses droits, & la plus libre du moins dans ses débats. C’est par
l’examen de cette formidable dette, & de son influence sur la richesse
de l’État & l’aisance du peuple, que l’Auteur ose commencer. Mais avant
d’en expliquer le méchanisme, dont le résultat présente des idées trop
contraires à l’opinion générale, l’Auteur tàche de familiariser peu à
peu ses Lecteurs avec la sienne, par des _Réflexions générales sur la
situation actuelle de l’~Angleterre~_; ces réflexions ne lui permettant
pas de douter, que la nation ne fût en 1779, malgré la dette nationale,
plus riche qu’au commencement du siècle, du quadruple, ou du double
seulement, suivant le calcul de population auquel on sera le plus
attaché.—On voit que l’Auteur, relativement à son plan, n’attache aucune
importance à la différence des opinions sur cet article.
_Une vue plus particulière du sujet_, présente à l’Auteur de nouvelles
raisons qui lui paroissent capables de tranquilliser le créancier le
plus inquiet.—Ce n’est à la vérité que par le moyen _des épargnes_
faites & à faire journellement sur 8 sols, portion exacte qui revient
à chaque individu dans le revenu général, qu’on a pu parvenir à
l’opulence, & qu’il est possible de s’y maintenir; mais l’Auteur cherche
_les épargnes_ qu’on ne peut méconnoître dans l’agriculture & dans
l’industrie: il trouve que celles de l’agriculture ont suffi depuis un
siècle, non-seulement pour satisfaire aux charges publiques, mais encore
pour doubler le revenu territorial; & il détaille ensuite une quantité
d’objets, faciles à vérifier, qui semblent démontrer le même progrès dans
l’industrie.
Ici l’Auteur commence à se croire assez ferme sur son terrein, pour
convenir qu’il ne voit rien dans la situation actuelle de l’_Angleterre_
qui puisse justifier l’idée d’une banqueroute, quoique les papiers
publics de cette nation en insinuent très-souvent la commodité. L’Auteur
s’oublie même jusqu’à examiner sérieusement, _s’il seroit avantageux de
rembourser ou de ne pas rembourser, même dans la supposition que les
238 millions empruntés & disparus, reparoîtroient dans les coffres de
l’Échiquier_.
Après avoir présenté la question sous plusieurs points de vue, l’Auteur
n’hésite point à se décider pour la négative, & tâche ensuite de prouver
qu’une _Thésaurisation_ antérieure qui eût mis la Nation en état de
soutenir la dernière guerre sans imposer aucune taxe additionelle, auroit
fait beaucoup plus de mal que les nouvelles taxes n’ont été capables d’en
faire.
L’Auteur devenu plus hardi, parce que personne ne le contredit
lorsqu’il est seul (& en vérité il est seul bien souvent), entreprend
de réconcilier le genre humain avec les taxes, au moyen d’une première
décomposition de l’impôt; il abandonne à la vérité une de ses parties
comme onéreuse, (il est fâcheux réellement qu’elle soit indispensable,
heureusement c’est la moindre;) mais il défend hautement l’autre partie,
comme une ressource très-précieuse pour cette portion du peuple qui
mérite le plus de captiver l’intérêt du Gouvernement.
Malgré toutes les précautions que l’Auteur a prises jusqu’ici pour ne
pas effaroucher ses Lecteurs, il lui reste un tel pas à franchir, qu’on
le voit presque à genoux pour supplier qu’on lui permette de le franchir
en vingt fois s’il n’y réussit pas en dix; c’est-à-dire, qu’il desire
beaucoup que son Ouvrage ne soit pas condamné _définitivement_, avant
d’avoir été lu jusqu’à la fin; en effet il n’est pas impossible qu’une
proposition détachée, dont le ridicule est frappant à l’exposition,
devienne cependant très-raisonnable lorsqu’elle aura été successivement
rapprochée de toutes celles qui doivent la suivre.—
Un Editeur doit encore plus au Public qu’à un Ouvrage auquel il seroit
même assez flatté de procurer une petite fortune; je crois donc être
obligé (_in foro conscientiæ_) de prévenir que ce n’est qu’après avoir
parcouru cinquante & quelques pages qu’on soupçonne pourquoi l’Auteur
n’a pas annoncé dès la première, les singularités qu’il se proposoit
insidieusement d’établir pied à pied dans sa brochure: mais enfin on peut
alors pressentir ce qu’on doit attendre d’un homme qui vient de conter
_que les taxes ne sont qu’un petit mal, que la Thésaurisation en seroit
un très-grand, qu’un remboursement est au moins inutile_,—& qui aussi-tôt
annonce modestement qu’il pourra bien, _par la suite_, lui échapper
quelques bizarreries,—comme s’il pouvoit y en avoir de plus complettes
que les trois propositions dont je viens de rendre compte.
Cependant il ne faut pas être trop sévère;—le Lecteur a-t-il été
seulement amusé par le coin du Tableau jusques-là découvert?—qu’il
se prête à la petite manie de l’Auteur; on renonceroit à montrer des
curiosités, si l’on n’avoit pas la liberté de lever le rideau à sa
fantaisie, si l’on n’avoit pas le droit de ne montrer, à chaque annonce,
que la petite partie de la curiosité, sur laquelle on veut fixer pour le
moment les yeux du Spectateur:—
Mais si le Lecteur n’a pas encore observé la moindre variation dans
le compas malgré la différence des positions; s’il n’a pas été un peu
ébranlé par les raisonnemens dont on l’aura bercé jusqu’alors,—qu’il
jette la brochure au feu; car l’Auteur, dont je ne prétends point imiter
la circonspection, ou adopter les craintes, ou justifier l’audace,
ou partager le délit, n’entreprend rien moins que d’engager _toute
l’Europe_, (toute Europe!) à examiner:
1ᵒ.
S’il seroit possible qu’il en coutât à l’_Angleterre_ au-delà de 5
millions sterling, _une fois trouvés_, pour assurer, _à perpétuité_, de
la façon la plus solide, le paiement de l’intérêt d’une dette de 238
millions, cet intérêt fixé à 9 millions même monnoie.
2ᵒ.
S’il n’y a pas sans qu’on l’imagine, dans le Systême de Finance de
l’_Angleterre_, quelquesunes des imperfections si bien observées, si
justement, si amèrement critiquées dans celui de la _France_; & si un
remboursement national n’est pas le plus facile de tous les jeux avec
lesquels un Ministre de Finance peut amuser la Société, sans la servir.
3ᵒ.
Si la possibilité d’une balance de commerce toujours favorable, n’est
pas aussi douteuse que la nécessité d’une banqueroute, & l’avantage d’un
remboursement.
4ᵒ.
Si l’équilibre en tout & par tout, n’est pas indispensable; & si,
pour maintenir ou rétablir cet équilibre, il faut de grands efforts
d’imagination de la part de ceux qui croient tenir la balance.
5ᵒ.
Si la différence des prix est quelque chose ou rien; & s’il a fallu
en _France_ au-delà de 66 millions tournois, _une fois trouvés_, pour
assurer, _à jamais_, l’intérêt à 5 p. cent d’un emprunt national de 1500
millions.
6ᵒ.
Si le monstre d’une concurrence en fait de commerce, prétendue invincible
graces à la légèreté des prix dont elle seroit armée, n’est pas aussi
fantastique que celui d’une balance toujours favorable.
7ᵒ.
Si le _præmium_ d’exportation le plus pardonnable, est autre chose qu’une
injustice devenue nécessaire pour en balancer une infinité d’autres.
8ᵒ.
S’il ne résulte pas du rétablissement toujours infaillible & purement
méchanique de l’équilibre dans tous les prix, que les taxes sont d’une
innocence absolue en elles-mêmes;—s’il est au-delà d’une espèce de
taxation, qui n’augmente la masse générale des prix que du montant précis
de la taxe;—si toutes les autres n’en triplent pas l’effet;—si la plus
pernicieuse, _après la capitation_, n’est pas celle _du luxe_;—& si du
moment où toutes les taxes _bonnes ou mauvaises_, ont réagi sur tout, le
fardeau de la dette nationale n’est pas évidemment NUL dans tous les pays.
9ᵒ.
Si le crédit n’est pas, _après le Monopole_, l’effet de la richesse qui
enchérisse le plus tous les produits de la terre & de l’industrie.
10ᵒ.
Si tel pays où la contrebande fut défendue sous peine des galères, ne
doit pas _à la contrebande_ un cinquième des produits de son agriculture,
dont le commerce profite avec aussi peu de scrupule que s’il n’eût pas
sollicité la loi abominable contre les contrebandiers.
11ᵒ.
Si l’absurdité de l’idée générale sur le moyen le plus propre pour
établir une concurrence avantageuse en fait de commerce, n’est pas
démontrée par l’Histoire d’une révolution singulière en _France_;
révolution aussi peu douteuse que les deux guerres de 1755 & de 1779.
12ᵒ.
Si l’impossibilité des deux balances prétendues par la _France_ &
par l’_Angleterre_, n’est pas prouvée par les faits allégués dans
les deux pays pour établir l’existence de ces deux monstres;—si
cette impossibilité n’est pas démontrée par d’autres faits aussi peu
équivoques;—& s’il n’est pas de l’intérêt de l’_Angleterre_ & de la
_France_, d’abjurer au plus tôt l’idole, & de renoncer authentiquement à
ses œuvres comme à ses pompes.
13ᵒ.
Si les exportations & importations ne sont pas un jeu aussi innocent que
celui de la paume; un jeu néanmoins dont tous les Gouvernemens pourroient
tirer un grand parti, tous les sujets un grand avantage, & tous les États
un accroissement de force & de richesse.
14ᵒ.
Si la généralité des exportations de l’_Angleterre_ en différens
périodes, considérée relativement à la correspondance étrangère, ne
démontre pas une espèce d’électricité dont on n’avoit pas encore l’idée,
& qui n’est pas indigne d’amuser le loisir des plus grands Politiques.
15ᵒ.
Si le badinage du luxe n’est pas aussi innocent que le jeu des
exportations & importations; & combien le plus fastueux, le plus
prodigue, le plus sensuel de tous les Princes, consomme au-delà du plus
avare de ses sujets.
16ᵒ.
Combien, en négligeant les sols & les deniers, l’_Angleterre_ a perdu
en perdant ce qu’on appelloit son bras droit; & combien, en négligeant
les sols & les deniers, toute l’_Europe_ perdroit si elle perdoit la
souveraineté des deux _Amériques_.
17ᵒ.
Si tout ce qui avoit paru à l’Auteur fondé en raison & en justice,
ne se trouve pas finalement, en dépit de la conjuration générale de
tous les Peuples & de tous les Ministres, conforme aux faits les plus
douteux;—& s’il ne résulte pas de la réunion des faits & des raisons,
que l’assertion de l’Auteur la plus intéressante pour l’humanité,
c’est-à-dire pour tous les Princes comme pour tous les Peuples, est de la
vérité la plus incontestable, & la plus facile à mettre à la portée de
tous les intéressés.
J’irai plus loin quoique Editeur. Je supposerai qu’il résultât aussi
de cette réunion de raisons & de faits, que les moyens qu’on a crus
jusqu’ici les plus propres à soulager le Peuple, étoient les plus
infaillibles pour le vexer; qu’est ce que cela fait au Peuple pourvu
qu’on ne le vexe plus? Le passé est-il autre chose qu’un songe?
Je supposerai encore qu’il en résultât qu’on n’a jamais travaillé plus
solidement à diminuer les revenus du Prince, que lorsqu’on s’est flatté
de les augmenter; qu’est-ce que cela fait au Prince, pourvu qu’il ne
soit plus possible de se méprendre sur les vrais moyens de l’enrichir?
N’est-ce pas de l’avenir sur tout, qu’un grand Prince doit s’occuper?
Je supposerai encore qu’il en résultât qu’on a eu grand tort de
s’imaginer qu’il falloit diminuer le revenu du Peuple pour augmenter
celui du Prince; qu’est-ce que cela fait au Prince & au Peuple, pourvu
qu’ils soient l’un & l’autre bien convaincus qu’il n’est pas possible
d’enrichir l’un, sans enrichir l’autre de la même manière, & dans la même
proportion?
Je supposerai encore qu’il en résultât évidemment qu’il n’y a pas eu
jusqu’ici dans les finances d’aucun pays, un seul principe, une seule
idée qui en méritât le nom; qu’est-ce que cela fait aux Ministres qui
dirigent aujourd’hui les finances? Le passé est-il à leurs ordres? Et
n’est-ce pas dans la rectification des abus découverts, que consiste la
vraie gloire d’un Ministère?
Je supposerai même, pour combler la mesure, qu’il en résultât pour un
très-simple individu _Américain_, une petite branche de cet arbuste
_Européen_ qu’on appelle laurier femelle; qu’est-ce que cela fait à tous
les Ministres, à tous les Peuples, à tous les Princes de l’_Europe_?
L’_Amérique_ consommera-t-elle moins de marchandises _Européennes_, &
produira-t-elle moins d’or & d’argent, pour avoir produit une idée?
[Illustration]
FOOTNOTES
[1] The 18 millions sterling in circulation, as calculated in 1688, by
Dr. _Davenant_, were, in 1711, brought down to 12 millions, probably as
we reduce now to 20 or 25, the 40 millions and upwards which might be
supposed in _England_, were we to confine ourselves to the calculation
of the coin struck in the present reign, and of the old pieces preserved
on account of their weight being unimpaired. The sequel will shew, that
it is next to an impossibility for a country, tolerably governed, to
preserve, for any length of time, more or less money than its wants
require.
[2] I have mentioned the fatal tree, as a consequence of the miseries
attending war. This is more sensibly felt in _England_ than any where
else, for reasons obvious to every one. During the first years that
immediately follow a peace, a four-fold number of wretches, to what
are executed at other times, are brought to the gallows. It is with
much ado that a man returns within the sphere of the confined and daily
occupations of the handicrafts or husbandmen, when he has for some years
rioted in that licentiousness permitted, in a manner, to soldiers and
sailors, in every thing that does not concern their respective service.
[3] This idea is the more to be attended to, as, supposing it were
possible that an increase of coin, within the nation, should enhance
the produce of industry alone, the landed proprietors would certainly
be obliged to petition for an act of parliament, _prohibiting the
importation of bullion, for fear it should be turned into coin_; just
as they would be obliged to pray for a tax on the productions of the
earth, if none but the taxed articles were to increase in price.—We now
petition against taxes; we should then pray to be taxed. This would be
no bad subject for a Comedy, if attempted by a writer who would handle
it properly. I hope the labouring man would be allotted a very bustling
part; that is, he would engross the best wishes of all good men, and
command the attention of all those who do not think themselves entitled
to that appellation.
[4] Since my writing the above I have seen the account-book (_Bilan_) of
another nation; I shall notice it in its proper place.
[5] Under the idea of labour, I comprise all kinds of capitals necessary
to keep in action the labouring man; a stock, or capital, is but an
accumulation of savings, made from former labours, whether it represents
the savings of a certain number of years, in regard to one man, or those
of some centuries, in regard to the nation or some privileged individuals.
[6] One of the most respectable _English_ writers has been charged with
having entirely given up the _American_ cause, which he had hitherto
so strenuously supported; in my opinion it is a mistake. It was not to
the _Americans_ that the Doctor was attached, it was to certain maxims,
plain but fertile, by which they seemed to have been directed, and
which the said author, establishes and recommends as the only guides
for all Princes and Nations, to lead them to that point of prosperity
the limits of which can be prescribed by Nature alone; the _Americans_
most probably will return to those maxims, and I presume to think, that
they will instantly be restored to the favour of that worthy Divine; my
opinions so nearly approach to those of that honest man on every point
that truly concerns society, that I wish either to convert him, or to
be perverted by him, with regard to the reimbursement. I must confess,
that if the ideas which are the ground-work of my principles, be false,
the error is mine alone; if I am right, the mistake of the Doctor, (like
the imperfections in _Shakespeare_), is the fault of his age, not of
himself. I shall further add, that the reimbursement, according to the
principles I have laid down, is not a measure by any means material to
the State; it is only a trifling injustice done to very little purpose,
and not even suspected by those who sustain it, a _je ne sais quoi_
giving to one a little credit and a little uneasiness to others, keeping
_the bulls and bears_ in spirits and the writers of paragraphs in full
employ, but luckily productive of a light and transitory sensation only,
and even that in a small part of the machine: so little is reimbursed
at a time! so soon is one tired of reimbursing! Presently, the only
essential object, the price of every thing shapes itself so well by the
circumstances attending the reimbursement, that I should not hesitate
to ascribe the ordinary, the infallible reparation of all evil, to the
credit of one sole principle of all good, were it not my invariable maxim
(as it is the Doctor’s and his friend _M. Turgot_’s) not to scandalise
even those who do not believe in God.
There is a prejudice much more unaccountable in _England_, in the
proud _England_, than the whim of a national reimbursement; it is that
prejudice which all the _hired_ writers, _pro_ and _con_, endeavour
to propagate from age to age in all countries, a prejudice, on the
destroying of which every unhired writer can never be too intent, that
prejudice stating, that _the prosperity of a State depends on one single
individual_. Where is that _Phœnix_ to be found? There are always two
pretenders at least, who cry at once, I AM THE MAN, and a thousand voices
exclaiming together, HE IS THE MAN. _The prosperity of a State, be its
extent what it may, solely depends on its agriculture, its industry, its
knowledge, and on that degree of liberty with which those three objects
can exert themselves in every way._ This is the grand truth which ought
to be impressed on every mind.⸺Let one great man die in a country where
great men are appreciated⸺stamp on the ground, and ten such men will
start up: many more will start up when every body, without respect either
to face or mask, is at liberty to stand as a candidate.
[7] Let the question on this very point be asked of any one, who can
remember, and compare. I except no article whatsoever of industry, which
is brought to perfection.
[8] It is truly farcical to hear and _see_ the deep-fetched sigh of a
tradesman, when he is reminded by a purchaser, that the subject matter of
the bargain is dearer than it used to be: “Alas! Sir, (says he) this very
article is taxed one shilling; and, Sir, I say nothing of that cursed
shop-tax.” But _why_? If the purchaser has some kind of labour, no matter
what, and no matter how, to dispose of, it is evident that, as soon as
the sigh will have gone round, the tax will be paid, _without any expence
but that of some thousands of sighs exchanged by the community at large_.
[9] I must confess I wish also that a little time could be spared to
examine whether all kinds of taxes, already devised or to be devised,
already established or to be established, on any other object but
_consumption_, whatever may be the appellation with which they may be
honoured or disgraced, from the land-tax down to the shop-tax, _are not
in fact so many poll-taxes_:—that is to say, I wish they would be pleased
to examine, whether that man whose _hand_ is obliged, _under pain of
distress_, to give at such a day such a sum, can, upon due recollection,
disguise to himself that his _head_ is as really taxed, as if the subsidy
to be paid was called _a poll-tax_, or _la taille_. If I am not mistaken,
the case is this: the shopkeeper feels that he ought not to pay a tax
upon his shop; he pays it and cries out like an eagle; he is right: the
land proprietor does not know that he ought not to pay a tax upon his
land; he pays it and says nothing; he is wrong: the Minister wanted
money; he thought that nothing remained untaxed; he suspected that the
land proprietor would at last cry out as loud as the shopkeeper, if the
land-tax was increased; he taxed the shops: a shop, in truth, does not
appear (very evidently at least) more sacred than the land upon which it
is erected.—It is not at all impossible, but that in some few years all
these misunderstandings will be talked of with as little reverence as
witchcraft; but till then, the good mother Nature must work underhand, as
she ever did, and probably ever will.
[10] In the Political Arithmetic of Mr. _Young_, may be seen the
accounts, year by year, whence I have drawn the inferences here submitted
to the Reader. It is but a few days ago that I thought of comparing with
my own ideas the result of the whole of those accounts.
[11] It is a very good idea, according to the Navigation-Act, to
restrain, as much as possible, the _English_ sugar-colonies, _which their
strongest interests attach for ever to England_,—to restrain, I say,
those sugar-colonies, in order to enlarge the faculties of some relics
of timber, tar, and wheat-colonies, _which their strongest interests
will detach from ~England~ as soon as_ they shall be strong enough to
make the best of their timber, tar, and wheat. It is said in _England_,
that the sugar-cane planters are so immensely rich, that they can well
afford to pay 20 _per cent._ dearer to their _dutiful_ brethren, for
what they could purchase 20 _per cent._ cheaper from their _revolted_
ones.—A sugar-cane planter, with a clear revenue of one or ten thousand
pounds sterling in sugar, is neither more nor less rich than a freeholder
in _Great-Britain_, with a clear revenue of one or ten thousand pounds
sterling in wheat or grass; the one, as well as the other, is every day
rich by the 2 or 4 pounds weight of food he can digest, and by the 6 or
10 or 15 _lb._ of cloaths he can wear; the one, as well as the other,
picks out those 10 or 20 pounds from the materials that best suit his
taste or fancy.—To the shame of thy power, ô Opulence, here thou must
stop! _huc usque venies_.—Such is the truth, no greater is the truth, no
less trivial is the truth, before which that _great globe itself_, that
immense and _baseless fabric_ of premiums, prohibitions, restrictions,
and so many other financiering _visions_—_shall dissolve, and leave not
a wreck behind_!
*** END OF THE PROJECT GUTENBERG EBOOK THOUGHTS ON THE MECHANISM OF SOCIETIES ***
Updated editions will replace the previous one—the old editions will
be renamed.
Creating the works from print editions not protected by U.S. copyright
law means that no one owns a United States copyright in these works,
so the Foundation (and you!) can copy and distribute it in the United
States without permission and without paying copyright
royalties. Special rules, set forth in the General Terms of Use part
of this license, apply to copying and distributing Project
Gutenberg™ electronic works to protect the PROJECT GUTENBERG™
concept and trademark. Project Gutenberg is a registered trademark,
and may not be used if you charge for an eBook, except by following
the terms of the trademark license, including paying royalties for use
of the Project Gutenberg trademark. If you do not charge anything for
copies of this eBook, complying with the trademark license is very
easy. You may use this eBook for nearly any purpose such as creation
of derivative works, reports, performances and research. Project
Gutenberg eBooks may be modified and printed and given away—you may
do practically ANYTHING in the United States with eBooks not protected
by U.S. copyright law. Redistribution is subject to the trademark
license, especially commercial redistribution.
START: FULL LICENSE
THE FULL PROJECT GUTENBERG LICENSE
PLEASE READ THIS BEFORE YOU DISTRIBUTE OR USE THIS WORK
To protect the Project Gutenberg™ mission of promoting the free
distribution of electronic works, by using or distributing this work
(or any other work associated in any way with the phrase “Project
Gutenberg”), you agree to comply with all the terms of the Full
Project Gutenberg™ License available with this file or online at
www.gutenberg.org/license.
Section 1. General Terms of Use and Redistributing Project Gutenberg™
electronic works
1.A. By reading or using any part of this Project Gutenberg™
electronic work, you indicate that you have read, understand, agree to
and accept all the terms of this license and intellectual property
(trademark/copyright) agreement. If you do not agree to abide by all
the terms of this agreement, you must cease using and return or
destroy all copies of Project Gutenberg™ electronic works in your
possession. If you paid a fee for obtaining a copy of or access to a
Project Gutenberg™ electronic work and you do not agree to be bound
by the terms of this agreement, you may obtain a refund from the person
or entity to whom you paid the fee as set forth in paragraph 1.E.8.
1.B. “Project Gutenberg” is a registered trademark. It may only be
used on or associated in any way with an electronic work by people who
agree to be bound by the terms of this agreement. There are a few
things that you can do with most Project Gutenberg™ electronic works
even without complying with the full terms of this agreement. See
paragraph 1.C below. There are a lot of things you can do with Project
Gutenberg™ electronic works if you follow the terms of this
agreement and help preserve free future access to Project Gutenberg™
electronic works. See paragraph 1.E below.
1.C. The Project Gutenberg Literary Archive Foundation (“the
Foundation” or PGLAF), owns a compilation copyright in the collection
of Project Gutenberg™ electronic works. Nearly all the individual
works in the collection are in the public domain in the United
States. If an individual work is unprotected by copyright law in the
United States and you are located in the United States, we do not
claim a right to prevent you from copying, distributing, performing,
displaying or creating derivative works based on the work as long as
all references to Project Gutenberg are removed. Of course, we hope
that you will support the Project Gutenberg™ mission of promoting
free access to electronic works by freely sharing Project Gutenberg™
works in compliance with the terms of this agreement for keeping the
Project Gutenberg™ name associated with the work. You can easily
comply with the terms of this agreement by keeping this work in the
same format with its attached full Project Gutenberg™ License when
you share it without charge with others.
1.D. The copyright laws of the place where you are located also govern
what you can do with this work. Copyright laws in most countries are
in a constant state of change. If you are outside the United States,
check the laws of your country in addition to the terms of this
agreement before downloading, copying, displaying, performing,
distributing or creating derivative works based on this work or any
other Project Gutenberg™ work. The Foundation makes no
representations concerning the copyright status of any work in any
country other than the United States.
1.E. Unless you have removed all references to Project Gutenberg:
1.E.1. The following sentence, with active links to, or other
immediate access to, the full Project Gutenberg™ License must appear
prominently whenever any copy of a Project Gutenberg™ work (any work
on which the phrase “Project Gutenberg” appears, or with which the
phrase “Project Gutenberg” is associated) is accessed, displayed,
performed, viewed, copied or distributed:
This eBook is for the use of anyone anywhere in the United States and most
other parts of the world at no cost and with almost no restrictions
whatsoever. You may copy it, give it away or re-use it under the terms
of the Project Gutenberg License included with this eBook or online
at www.gutenberg.org. If you
are not located in the United States, you will have to check the laws
of the country where you are located before using this eBook.
1.E.2. If an individual Project Gutenberg™ electronic work is
derived from texts not protected by U.S. copyright law (does not
contain a notice indicating that it is posted with permission of the
copyright holder), the work can be copied and distributed to anyone in
the United States without paying any fees or charges. If you are
redistributing or providing access to a work with the phrase “Project
Gutenberg” associated with or appearing on the work, you must comply
either with the requirements of paragraphs 1.E.1 through 1.E.7 or
obtain permission for the use of the work and the Project Gutenberg™
trademark as set forth in paragraphs 1.E.8 or 1.E.9.
1.E.3. If an individual Project Gutenberg™ electronic work is posted
with the permission of the copyright holder, your use and distribution
must comply with both paragraphs 1.E.1 through 1.E.7 and any
additional terms imposed by the copyright holder. Additional terms
will be linked to the Project Gutenberg™ License for all works
posted with the permission of the copyright holder found at the
beginning of this work.
1.E.4. Do not unlink or detach or remove the full Project Gutenberg™
License terms from this work, or any files containing a part of this
work or any other work associated with Project Gutenberg™.
1.E.5. Do not copy, display, perform, distribute or redistribute this
electronic work, or any part of this electronic work, without
prominently displaying the sentence set forth in paragraph 1.E.1 with
active links or immediate access to the full terms of the Project
Gutenberg™ License.
1.E.6. You may convert to and distribute this work in any binary,
compressed, marked up, nonproprietary or proprietary form, including
any word processing or hypertext form. However, if you provide access
to or distribute copies of a Project Gutenberg™ work in a format
other than “Plain Vanilla ASCII” or other format used in the official
version posted on the official Project Gutenberg™ website
(www.gutenberg.org), you must, at no additional cost, fee or expense
to the user, provide a copy, a means of exporting a copy, or a means
of obtaining a copy upon request, of the work in its original “Plain
Vanilla ASCII” or other form. Any alternate format must include the
full Project Gutenberg™ License as specified in paragraph 1.E.1.
1.E.7. Do not charge a fee for access to, viewing, displaying,
performing, copying or distributing any Project Gutenberg™ works
unless you comply with paragraph 1.E.8 or 1.E.9.
1.E.8. You may charge a reasonable fee for copies of or providing
access to or distributing Project Gutenberg™ electronic works
provided that:
• You pay a royalty fee of 20% of the gross profits you derive from
the use of Project Gutenberg™ works calculated using the method
you already use to calculate your applicable taxes. The fee is owed
to the owner of the Project Gutenberg™ trademark, but he has
agreed to donate royalties under this paragraph to the Project
Gutenberg Literary Archive Foundation. Royalty payments must be paid
within 60 days following each date on which you prepare (or are
legally required to prepare) your periodic tax returns. Royalty
payments should be clearly marked as such and sent to the Project
Gutenberg Literary Archive Foundation at the address specified in
Section 4, “Information about donations to the Project Gutenberg
Literary Archive Foundation.”
• You provide a full refund of any money paid by a user who notifies
you in writing (or by e-mail) within 30 days of receipt that s/he
does not agree to the terms of the full Project Gutenberg™
License. You must require such a user to return or destroy all
copies of the works possessed in a physical medium and discontinue
all use of and all access to other copies of Project Gutenberg™
works.
• You provide, in accordance with paragraph 1.F.3, a full refund of
any money paid for a work or a replacement copy, if a defect in the
electronic work is discovered and reported to you within 90 days of
receipt of the work.
• You comply with all other terms of this agreement for free
distribution of Project Gutenberg™ works.
1.E.9. If you wish to charge a fee or distribute a Project
Gutenberg™ electronic work or group of works on different terms than
are set forth in this agreement, you must obtain permission in writing
from the Project Gutenberg Literary Archive Foundation, the manager of
the Project Gutenberg™ trademark. Contact the Foundation as set
forth in Section 3 below.
1.F.
1.F.1. Project Gutenberg volunteers and employees expend considerable
effort to identify, do copyright research on, transcribe and proofread
works not protected by U.S. copyright law in creating the Project
Gutenberg™ collection. Despite these efforts, Project Gutenberg™
electronic works, and the medium on which they may be stored, may
contain “Defects,” such as, but not limited to, incomplete, inaccurate
or corrupt data, transcription errors, a copyright or other
intellectual property infringement, a defective or damaged disk or
other medium, a computer virus, or computer codes that damage or
cannot be read by your equipment.
1.F.2. LIMITED WARRANTY, DISCLAIMER OF DAMAGES - Except for the “Right
of Replacement or Refund” described in paragraph 1.F.3, the Project
Gutenberg Literary Archive Foundation, the owner of the Project
Gutenberg™ trademark, and any other party distributing a Project
Gutenberg™ electronic work under this agreement, disclaim all
liability to you for damages, costs and expenses, including legal
fees. YOU AGREE THAT YOU HAVE NO REMEDIES FOR NEGLIGENCE, STRICT
LIABILITY, BREACH OF WARRANTY OR BREACH OF CONTRACT EXCEPT THOSE
PROVIDED IN PARAGRAPH 1.F.3. YOU AGREE THAT THE FOUNDATION, THE
TRADEMARK OWNER, AND ANY DISTRIBUTOR UNDER THIS AGREEMENT WILL NOT BE
LIABLE TO YOU FOR ACTUAL, DIRECT, INDIRECT, CONSEQUENTIAL, PUNITIVE OR
INCIDENTAL DAMAGES EVEN IF YOU GIVE NOTICE OF THE POSSIBILITY OF SUCH
DAMAGE.
1.F.3. LIMITED RIGHT OF REPLACEMENT OR REFUND - If you discover a
defect in this electronic work within 90 days of receiving it, you can
receive a refund of the money (if any) you paid for it by sending a
written explanation to the person you received the work from. If you
received the work on a physical medium, you must return the medium
with your written explanation. The person or entity that provided you
with the defective work may elect to provide a replacement copy in
lieu of a refund. If you received the work electronically, the person
or entity providing it to you may choose to give you a second
opportunity to receive the work electronically in lieu of a refund. If
the second copy is also defective, you may demand a refund in writing
without further opportunities to fix the problem.
1.F.4. Except for the limited right of replacement or refund set forth
in paragraph 1.F.3, this work is provided to you ‘AS-IS’, WITH NO
OTHER WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE.
1.F.5. Some states do not allow disclaimers of certain implied
warranties or the exclusion or limitation of certain types of
damages. If any disclaimer or limitation set forth in this agreement
violates the law of the state applicable to this agreement, the
agreement shall be interpreted to make the maximum disclaimer or
limitation permitted by the applicable state law. The invalidity or
unenforceability of any provision of this agreement shall not void the
remaining provisions.
1.F.6. INDEMNITY - You agree to indemnify and hold the Foundation, the
trademark owner, any agent or employee of the Foundation, anyone
providing copies of Project Gutenberg™ electronic works in
accordance with this agreement, and any volunteers associated with the
production, promotion and distribution of Project Gutenberg™
electronic works, harmless from all liability, costs and expenses,
including legal fees, that arise directly or indirectly from any of
the following which you do or cause to occur: (a) distribution of this
or any Project Gutenberg™ work, (b) alteration, modification, or
additions or deletions to any Project Gutenberg™ work, and (c) any
Defect you cause.
Section 2. Information about the Mission of Project Gutenberg™
Project Gutenberg™ is synonymous with the free distribution of
electronic works in formats readable by the widest variety of
computers including obsolete, old, middle-aged and new computers. It
exists because of the efforts of hundreds of volunteers and donations
from people in all walks of life.
Volunteers and financial support to provide volunteers with the
assistance they need are critical to reaching Project Gutenberg™’s
goals and ensuring that the Project Gutenberg™ collection will
remain freely available for generations to come. In 2001, the Project
Gutenberg Literary Archive Foundation was created to provide a secure
and permanent future for Project Gutenberg™ and future
generations. To learn more about the Project Gutenberg Literary
Archive Foundation and how your efforts and donations can help, see
Sections 3 and 4 and the Foundation information page at www.gutenberg.org.
Section 3. Information about the Project Gutenberg Literary Archive Foundation
The Project Gutenberg Literary Archive Foundation is a non-profit
501(c)(3) educational corporation organized under the laws of the
state of Mississippi and granted tax exempt status by the Internal
Revenue Service. The Foundation’s EIN or federal tax identification
number is 64-6221541. Contributions to the Project Gutenberg Literary
Archive Foundation are tax deductible to the full extent permitted by
U.S. federal laws and your state’s laws.
The Foundation’s business office is located at 809 North 1500 West,
Salt Lake City, UT 84116, (801) 596-1887. Email contact links and up
to date contact information can be found at the Foundation’s website
and official page at www.gutenberg.org/contact
Section 4. Information about Donations to the Project Gutenberg
Literary Archive Foundation
Project Gutenberg™ depends upon and cannot survive without widespread
public support and donations to carry out its mission of
increasing the number of public domain and licensed works that can be
freely distributed in machine-readable form accessible by the widest
array of equipment including outdated equipment. Many small donations
($1 to $5,000) are particularly important to maintaining tax exempt
status with the IRS.
The Foundation is committed to complying with the laws regulating
charities and charitable donations in all 50 states of the United
States. Compliance requirements are not uniform and it takes a
considerable effort, much paperwork and many fees to meet and keep up
with these requirements. We do not solicit donations in locations
where we have not received written confirmation of compliance. To SEND
DONATIONS or determine the status of compliance for any particular state
visit www.gutenberg.org/donate.
While we cannot and do not solicit contributions from states where we
have not met the solicitation requirements, we know of no prohibition
against accepting unsolicited donations from donors in such states who
approach us with offers to donate.
International donations are gratefully accepted, but we cannot make
any statements concerning tax treatment of donations received from
outside the United States. U.S. laws alone swamp our small staff.
Please check the Project Gutenberg web pages for current donation
methods and addresses. Donations are accepted in a number of other
ways including checks, online payments and credit card donations. To
donate, please visit: www.gutenberg.org/donate.
Section 5. General Information About Project Gutenberg™ electronic works
Professor Michael S. Hart was the originator of the Project
Gutenberg™ concept of a library of electronic works that could be
freely shared with anyone. For forty years, he produced and
distributed Project Gutenberg™ eBooks with only a loose network of
volunteer support.
Project Gutenberg™ eBooks are often created from several printed
editions, all of which are confirmed as not protected by copyright in
the U.S. unless a copyright notice is included. Thus, we do not
necessarily keep eBooks in compliance with any particular paper
edition.
Most people start at our website which has the main PG search
facility: www.gutenberg.org.
This website includes information about Project Gutenberg™,
including how to make donations to the Project Gutenberg Literary
Archive Foundation, how to help produce our new eBooks, and how to
subscribe to our email newsletter to hear about new eBooks.
